Cover
Cover | 12 Months Ended |
Dec. 31, 2022 | |
Cover [Abstract] | |
Entity Registrant Name | TALCOTT RESOLUTION LIFE INSURANCE COMPANY |
Entity Central Index Key | 0000045947 |
Document Type | POS AM |
Amendment Flag | false |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Revenues | ||||
Policy charges and fee income | $ 410 | $ 438 | $ 506 | $ 741 |
Premiums | 31 | 24 | 109 | 35 |
Net investment income | 498 | 534 | 778 | 816 |
Net realized capital gains (losses) | (20) | (242) | 317 | (74) |
Amortization of deferred gains | 0 | 26 | 33 | 53 |
Total revenues | 919 | 780 | 1,743 | 1,571 |
Benefits, losses and expenses | ||||
Benefits and losses | 285 | 375 | 637 | 626 |
Amortization of value of business acquired ("VOBA") and deferred acquisition costs ("DAC") | 90 | (43) | 79 | 50 |
Insurance operating costs and other expenses | 208 | 228 | 294 | 364 |
Other intangible asset amortization | 3 | 3 | 6 | 6 |
Dividends to policyholders | 2 | 1 | 3 | 60 |
Total benefits, losses and expenses | 588 | 564 | 1,019 | 1,106 |
Income before income taxes | 331 | 216 | 724 | 465 |
Provision for income taxes | 51 | 30 | 107 | 66 |
Net income | $ 280 | $ 186 | $ 617 | $ 399 |
Consolidated Statements of Op_2
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Policy charges and fee income | $ 506 | |
Premiums Earned, Net | 109 | |
Net investment income | 778 | |
Net realized capital gains (losses) | 317 | |
Amortization of deferred gains | 33 | |
Benefits and losses | 637 | |
Insurance operating costs and other expenses | 294 | |
Affiliated Entity | ||
Policy charges and fee income | (279) | |
Premiums Earned, Net | (27) | |
Net investment income | (136) | |
Net realized capital gains (losses) | 990 | |
Amortization of deferred gains | 27 | |
Benefits and losses | (184) | |
Insurance operating costs and other expenses | $ (119) | $ 0 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 280 | $ 186 | $ 617 | $ 399 |
Other comprehensive income (loss) ("OCI"): | ||||
Change in net unrealized gain or loss on fixed maturities, AFS | (10) | (275) | (2,129) | 565 |
Change in net gain or loss on cash flow hedging instruments | 0 | 1 | (27) | (1) |
OCI, net of tax | (10) | (274) | (2,156) | 564 |
Comprehensive income (loss) | $ 270 | $ (88) | $ (1,539) | $ 963 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Investments: | ||
Fixed maturities, available-for-sale, at fair value (net of ACL of $0 and $0) (amortized cost of $18,689 and $20,986) | $ 15,383 | $ 20,971 |
Fixed maturities, at fair value, using fair value option | 331 | 0 |
Equity securities, at fair value | 179 | 203 |
Mortgage loans (net of ACL of $15 and $12) | 2,520 | 2,131 |
Policy loans | 1,495 | 1,484 |
Limited partnerships and other alternative investments (portion at fair value: $58 and $0) | 1,300 | 1,147 |
Other investments | 95 | 26 |
Short-term investments | 1,489 | 1,254 |
Total investments | 22,792 | 27,216 |
Cash | 173 | 49 |
Reinsurance recoverables (net of ACL of $27 and $37) (related party: $11,537 and $6,143) (portion at fair value: $335 and $(8)) | 40,714 | 35,848 |
VOBA and DAC | 518 | 479 |
Deferred income taxes, net | 1,051 | 603 |
Goodwill and other intangible assets | 155 | 161 |
Other assets | 453 | 416 |
Separate account assets | 87,255 | 111,592 |
Total assets | 153,111 | 176,364 |
Liabilities | ||
Reserve for future policy benefits | 21,432 | 21,698 |
Other policyholder funds and benefits payable | 31,302 | 32,622 |
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 10,485 | 6,379 |
Other liabilities (related party: $915 and $818) | 2,023 | 1,920 |
Separate account liabilities | 87,255 | 111,592 |
Total liabilities | 152,497 | 174,211 |
Commitments and Contingencies | ||
Stockholder’s Equity | ||
Common stock—1,000 shares authorized, issued and outstanding, par value $5,690 | 6 | 6 |
Additional paid-in capital | 1,877 | 1,877 |
Accumulated other comprehensive loss, net of tax | (2,166) | (10) |
Retained earnings | 897 | 280 |
Total stockholder’s equity | 614 | 2,153 |
Total liabilities and stockholder’s equity | $ 153,111 | $ 176,364 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Allowance for credit loss | $ 0 | $ 0 |
Available-for-sale, amortized cost | 18,689 | 20,986 |
Mortgage loans, allowance for credit loss | 15 | 12 |
Limited partnerships and other alternative investments, fair value | 58 | 0 |
Reinsurance recoverable, allowance for credit loss | 27 | 37 |
Reinsurance recoverables | 40,714 | 35,848 |
Derivative, fair value | 1,779 | (777) |
Other policyholder funds and benefits payable, fair value | 254 | 575 |
Funds withheld liability | 10,485 | 6,379 |
Other liabilities (related party: $915 and $818) | $ 2,023 | $ 1,920 |
Common stock, shares authorized | 1,000 | 1,000 |
Common stock, shares, issued | 1,000 | 1,000 |
Common stock, shares, outstanding | 1,000 | 1,000 |
Common stock, par value (in dollars per share) | $ 5,690 | $ 5,690 |
Reinsurance recoverable for GMWB | ||
Derivative, fair value | $ 335 | $ (8) |
Funds withheld liability | ||
Fair Value | 1,481 | 15 |
Affiliated Entity | ||
Reinsurance recoverables | 11,537 | 6,143 |
Funds withheld liability | 9,248 | 5,128 |
Other liabilities (related party: $915 and $818) | $ 915 | $ 818 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholder's Equity - USD ($) $ in Millions | Total | Cumulative effect of accounting changes, net of tax | Adjusted balance | Common Stock | Common Stock Cumulative effect of accounting changes, net of tax | Common Stock Adjusted balance | Additional Paid-In Capital | Additional Paid-In Capital Cumulative effect of accounting changes, net of tax | Additional Paid-In Capital Adjusted balance | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Cumulative effect of accounting changes, net of tax | Accumulated Other Comprehensive Loss Adjusted balance | Retained Earnings | Retained Earnings Cumulative effect of accounting changes, net of tax | Retained Earnings Adjusted balance |
Beginning balance at Dec. 31, 2019 | $ 2,552 | $ (11) | $ 2,541 | $ 6 | $ 0 | $ 6 | $ 1,761 | $ 0 | $ 1,761 | $ 717 | $ 0 | $ 717 | $ 68 | $ (11) | $ 57 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income | 399 | 399 | |||||||||||||
OCI, net of tax | 564 | 564 | |||||||||||||
Dividends paid | (319) | (319) | |||||||||||||
Ending balance at Dec. 31, 2020 | 3,185 | 6 | 1,761 | 1,281 | 137 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income | 186 | 186 | |||||||||||||
OCI, net of tax | (274) | (274) | |||||||||||||
Capital contribution to parent | (235) | (235) | |||||||||||||
Dividends paid | (265) | (265) | |||||||||||||
Ending balance at Jun. 30, 2021 | 2,597 | 6 | 1,526 | 1,007 | 58 | ||||||||||
Beginning balance at Dec. 31, 2020 | 3,185 | 6 | 1,761 | 1,281 | 137 | ||||||||||
Ending balance at Dec. 31, 2021 | 2,153 | 6 | 1,877 | (10) | 280 | ||||||||||
Beginning balance at Jun. 30, 2021 | 2,597 | 6 | 1,526 | 1,007 | 58 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income | 280 | ||||||||||||||
OCI, net of tax | (10) | ||||||||||||||
Ending balance at Dec. 31, 2021 | 2,153 | 6 | 1,877 | (10) | 280 | ||||||||||
Beginning balance at Jul. 01, 2021 | 1,883 | 6 | 1,877 | 0 | 0 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income | 280 | 280 | |||||||||||||
OCI, net of tax | (10) | (10) | |||||||||||||
Ending balance at Dec. 31, 2021 | 2,153 | 6 | 1,877 | (10) | 280 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income | 617 | 617 | |||||||||||||
OCI, net of tax | (2,156) | (2,156) | |||||||||||||
Ending balance at Dec. 31, 2022 | $ 614 | $ 6 | $ 1,877 | $ (2,166) | $ 897 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||||
Dec. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Activities | ||||||
Net income | $ 280 | $ 280 | $ 186 | $ 617 | $ 399 | |
Adjustments to reconcile net income to net cash provided by (used for) operating activities | ||||||
Net realized capital (gains) losses (related party 2022: $990) | 20 | 242 | (317) | 74 | ||
Amortization of deferred reinsurance gain (related party 2022: $27) | 0 | (26) | (33) | (53) | ||
Amortization of VOBA | 90 | (43) | 79 | 50 | ||
Depreciation and amortization | 102 | 38 | 227 | 69 | ||
Deferred income tax expense | 138 | 29 | 125 | 54 | ||
Interest credited on investment and universal life-type contracts | 314 | 152 | 534 | 379 | ||
Other operating activities, net | (208) | (114) | (38) | (120) | ||
Change in assets and liabilities: | ||||||
Increase in reinsurance recoverables | (63) | (134) | (758) | (331) | ||
Increase (decrease) for future policy benefits and unearned premiums | (40) | 63 | 230 | 160 | ||
Net changes in other assets and other liabilities | (132) | 51 | 93 | 185 | ||
Net proceeds from (payments for) reinsurance transactions | (877) | 0 | 121 | 0 | ||
Net cash provided by (used for) operating activities | (376) | 444 | 880 | 866 | ||
Proceeds from the sale/maturity/prepayment of: | ||||||
Fixed maturities, available-for-sale | 2,976 | 1,622 | 6,185 | 2,824 | ||
Equity securities, at fair value | 47 | 3 | 26 | 7 | ||
Mortgage loans | 294 | 158 | 258 | 373 | ||
Partnerships | 102 | 71 | 64 | 77 | ||
Payments for the purchase of: | ||||||
Fixed maturities, available-for-sale | (1,974) | (1,197) | (4,255) | (2,866) | ||
Fixed maturities, fair value option | 0 | 0 | (352) | 0 | ||
Equity securities, at fair value | (121) | (45) | (22) | (26) | ||
Mortgage loans | (207) | (177) | (667) | (242) | ||
Partnerships | (100) | (74) | (158) | (134) | ||
Net proceeds from (payments for) repurchase agreements program | (11) | 8 | 25 | (16) | ||
Net proceeds from (payments for) derivatives | (161) | (539) | (559) | 143 | ||
Net proceeds from (payments for) policy loans | 9 | (32) | (11) | 15 | ||
Net proceeds from (payments for) short-term investments | (314) | 200 | (255) | (234) | ||
Other investing activities, net | 0 | 0 | 0 | (10) | ||
Net cash provided by (used for) investing activities | 540 | (2) | 279 | (89) | ||
Financing Activities | ||||||
Deposits and other additions to investment and universal life-type contracts | 872 | 1,001 | 2,033 | 1,971 | ||
Withdrawals and other deductions from investment and universal life-type contracts | (4,766) | (4,862) | (8,109) | (9,627) | ||
Net transfers from separate accounts related to investment and universal life-type contracts | 3,598 | 3,659 | 5,140 | 7,117 | ||
Net increase (decrease) in securities loaned or sold under agreements to repurchase | 131 | 270 | (99) | (7) | ||
Dividend paid on shares outstanding | 0 | (265) | 0 | (319) | ||
Return of capital to parent | 0 | (235) | 0 | 0 | ||
Net cash used for financing activities | (165) | (432) | (1,035) | (865) | ||
Net increase (decrease) in cash | (1) | 10 | 124 | (88) | ||
Cash — beginning of period | 50 | 40 | 49 | $ 40 | 128 | |
Cash — end of period | 49 | $ 49 | 50 | 173 | $ 49 | 40 |
Supplemental Disclosure of Cash Flow Information: | ||||||
Income taxes received (paid) | $ (13) | $ 2 | $ 142 | $ 0 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Net realized capital (gains) losses (related party 2022: $990) | $ (317) |
Amortization of deferred reinsurance gain (related party 2022: $27) | (33) |
Affiliated Entity | |
Net realized capital (gains) losses (related party 2022: $990) | 990 |
Amortization of deferred reinsurance gain (related party 2022: $27) | $ 27 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Basis of Presentation Talcott Resolution Life Insurance Company, together with its consolidated subsidiaries, (collectively, "TL," the "Company," "we" or "our") is a life insurance and annuity company and comprehensive risk solutions-provider in the United States ("U.S.") and is a wholly-owned subsidiary of TR Re, Ltd. ("TR Re"), a Bermuda based entity. Talcott Resolution Life, Inc. ("TLI"), a Delaware corporation and Talcott Holdings, L.P. ("THLP") are indirect parents of the Company and the Company has an ultimate parent of Talcott Financial Group, Ltd. ("TFG" or "Talcott Financial Group"). The Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”), which differ materially from the accounting practices prescribed by various insurance regulatory authorities. Certain reclassifications have been made to conform to current year presentation. On June 30, 2021, the Company’s previous indirect owner, Hopmeadow Holdings GP LLC, completed the sale of the Company (the "Sixth Street Acquisition") through the merger of an affiliate of Sixth Street, a global investment firm, with and into THLP pursuant to an Agreement and Plan of Merger (the “Agreement"). Through the Agreement, TFG indirectly obtained 100% control of THLP and its life and annuity operating subsidiaries for a total purchase price of approximately $2.2 billion, comprised of a $500 pre-closing dividend and cash of $1.7 billion. The merger was accounted for using business combination accounting, together with an election to apply pushdown accounting. Under this method, the purchase price paid was assigned to the identifiable assets acquired and liabilities assumed as of the acquisition date based on their fair value. Determining the fair value of certain assets acquired and liabilities assumed is judgmental in nature and often involves the use of significant estimates and assumptions. The Company’s financial statements and footnote disclosures are presented into two distinct periods. The periods prior to the consummation of the Agreement are labeled ("Predecessor Company") and the periods subsequent to that date are labeled ("Successor Company") to distinguish between the different basis of accounting between the periods presented. As a result of the application of purchase accounting, the financial statements for the year ended December 31, 2022 and period of July 1, 2021 to December 31, 2021, are not comparable to the prior periods presented. In addition, as a result of the acquisition the Company conformed to TFG’s accounting policies and modified its presentation for certain transactions. Description of Business As of December 31, 2022, the Company managed approximately 490 thousand annuity contracts with an account value of approximately $36.7 billion, gross of reinsurance, and private placement life insurance with an account value of approximately $39.0 billion. Upon the Company's acquisition by Sixth Street, the Company's strategy changed to be one of a life insurance aggregator through reinsurance. Since the Sixth Street acquisition, the Company has participated in multiple assumed reinsurance transactions that have positioned the Company, as part of the Talcott Financial Group, as a leading participant in this area of the life insurance marketplace. As part of the Company's growth strategy, the Company assumes life insurance blocks of business, providing external insurers with solutions to create capital flexibility and risk management efficiencies. Since the Sixth Street Acquisition and as of December 31, 2022, the Company has assumed fixed indexed annuities of $6.4 billion and variable annuities of $6.6 billion. On November 1, 2022, the Company entered into a reinsurance agreement with The Guardian Insurance & Annuity Company, Inc. (“GIAC” or "Guardian") to reinsure $7.1 billion in variable annuity reserves, primarily comprised of contracts with living withdrawal benefit and death benefit riders. The Company assumed 100% of $439 in general account reserves on a coinsurance basis and assumed 100% of $6.7 billion in separate account reserves on a modified coinsurance basis. The Company acquired general account assets to support the assumed reserves and received $121 in cash from GIAC upon closing, primarily relating to a ceding commission of $65 and cash settlements. A deferred gain on reinsurance was recorded in other liabilities upon the effective date for approximately $90 and will be recognized in income over the expected life of the underlying policies. As part of this transaction, the Company entered into an administration services agreement for the reinsured block and will ultimately administer the reinsured block within two years following the close of the transaction. On December 30, 2021, pursuant to a reorganization approved by the Connecticut Department of Insurance ("CTDOI") on November 18, 2021, TLI contributed the Company to TR Re and TR Re subsequently became the Company's direct parent. TR Re was formed on June 28, 2021 and is an approved Class E insurer under the Bermuda Monetary Authority. On December 30, 2021, the Company entered into a reinsurance agreement with Allianz Life Insurance Company of North America ("Allianz") to assume approximately $8.0 billion of fixed indexed annuities ("FIA") reserves ("Inforce Agreement"). The Company assumed 100% of one block (approximately $5.0 billion of FIA reserves) and 5% of another block (approximately $3.0 billion of FIA reserves) on a coinsurance basis and the Company acquired general account assets to support these assumed reserves. Certain of the FIAs included living withdrawal benefits. The Company paid $693 to Allianz upon closing, primarily relating to a ceding commission of $866, offset by cash settlements. The Company will participate in an aggregated hedging pool administered by Allianz, whereby the Company will pay Allianz a fee in order to participate in the pool and will receive an index credit payout based on the level of participation in the pool. A deferred gain on reinsurance was recorded in other liabilities upon the effective date for approximately $25 and will be recognized in income over the expected life of the underlying policies. On July 29, 2022, the Company executed a flow reinsurance agreement with Allianz. Under the terms of the transaction, the Company assumed certain FIA contracts issued by Allianz after August 2, 2022 on a coinsurance basis ("Flow Agreement"). Allianz will continue to service and administer the policies reinsured under the Inforce Agreement and Flow Agreement as the direct insurer of the business. On December 31, 2022, the Company retroceded 75% of the business assumed from Allianz to TR Re on a modified coinsurance basis. As a result of the retrocession, the Company recorded a deferred gain of $137. On December 30, 2021, the Company entered into an affiliated reinsurance agreement with its parent TR Re. The Company generally ceded 50% of reserves related to variable and payout annuity blocks, with 100% of certain variable annuity guarantees and certain structured settlement contracts ceded at a lesser quota share percentage. All but the Company’s terminal funding block was ceded on a modified coinsurance basis, with the terminal funding block ceded on a coinsurance with funds withheld basis. The reinsured business ceded was the Company's direct written business and was not previously assumed. This affiliate reinsurance transaction was accounted for in accordance with reinsurance accounting. Under this method, a deferred gain on reinsurance was recorded in other liabilities of approximately $805 and will be recognized in income over the expected life of the underlying policies. The Company will continue to service and administer the policies as insurer of the reinsured block of business and will remain responsible for fulfilling its obligations to policyholders. The Company paid TR Re $100 in ceding commission and an additional $84 to settle tax balances associated with the transaction as part of the arrangement. On September 17, 2021, the Company executed a flow reinsurance transaction with Lincoln National Corporation's ("Lincoln") insurance subsidiary, The Lincoln National Life Insurance Company. The Company coinsured a living benefit rider on variable annuity contracts issued by Lincoln between April 1, 2021 through June 30, 2022 up to a maximum of $1.5 billion of reinsured deposits. In June 2022, the Company entered into an extension of the agreement through June 30, 2023, at a lower quota share for contracts issued subsequent to June 30, 2022. Lincoln will continue to service and administer the policies as direct insurer of the business. For additional information regarding reinsurance transactions, refer to Note 5 - Reinsurance. In conjunction with the sale from The Hartford Financial Services Group ("The Hartford") in 2018, the Company entered into a five year transition services agreement with The Hartford to provide general ledger, cash management, investment accounting and information technology infrastructure services. In March 2019, the Company converted its existing transition services agreement for investment accounting services into an administrative service agreement, which expires in May 2023. The transition services agreement with The Hartford for the remaining services ended in 2020, as those services had fully transitioned to the Company. Consolidation The Consolidated Financial Statements include the accounts of the Company and entities the Company directly or indirectly has a controlling financial interest in which the Company is required to consolidate. Entities in which the Company has significant influence over the operating and financing decisions but is not required to consolidate are reported using the equity method. All intercompany transactions and balances between the Company and its subsidiaries have been eliminated. Use of Estimates The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The most significant estimates include: • Valuation of investments, including the underlying investments within the funds withheld liability; • Evaluation of credit losses on fixed maturities, available for sale ("AFS"); • Allowance for credit losses (“ACL”) on mortgage loans; • Valuation of derivative assets and liabilities, including embedded derivatives; • Valuation of liabilities associated with FIA; • Estimated gross profits ("EGPs") used to amortize VOBA and liabilities associated with variable annuities, FIA, and other universal life-type contracts, as well as certain deferred reinsurance amounts; • Evaluation of goodwill and other intangible assets for impairment; • Valuation of living withdrawal benefits and FIA required to be recorded at fair value; • Valuation of value of business acquired ("VOBA"), deferred gains on reinsurance, and deferred acquisition costs ("DAC"); • Valuation allowance on deferred tax assets; • Contingencies relating to corporate litigation and regulatory matters Certain of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the Consolidated Financial Statements. Pushdown Accounting Sixth Street The Sixth Street Acquisition was accounted for using business combination accounting, together with an election to apply pushdown accounting. The goodwill from the Sixth Street Acquisition is attributable to the Company's expectation that the combined group can leverage its insurance platform to become a life insurance aggregator. Goodwill for the Sixth Street Acquisition is not deductible for tax purposes. The following table represents the final determination of the fair value of the assets acquired and liabilities assumed for the Sixth Street Acquisition: Cash and invested assets $ 19,711 VOBA 565 Deferred income taxes 737 Goodwill 97 Other intangible assets 67 Reinsurance recoverables and other assets [1] 30,481 Separate account assets 112,857 Total assets 164,515 Reserves for future policy benefits 21,122 Other policyholder funds and benefits payable 25,961 Funds withheld liability [1] 1,039 Other liabilities 1,653 Separate account liabilities 112,857 Total liabilities 162,632 Stockholder's equity 1,883 Total liabilities and stockholder's equity $ 164,515 [1] Previously reported table was updated to reflect the gross presentation for modified coinsurance reinsurance transactions. The Successor Company's assets and liabilities are recognized based on TFG’s accounting basis, with an offset to additional paid-in capital. In addition, retained earnings and accumulated other comprehensive income (“AOCI”) of the Predecessor Company are not carried forward, as a new basis of accounting has been established. Invested Assets The acquired investments are recorded at fair value through adjustments to additional paid-in capital at the acquisition date. Value of Business Acquired/Additional Reserves In conjunction with the acquisition of the Company, a portion of the purchase price was allocated to the right to receive future gross profits from cash flows and earnings of the Company's insurance and investment contracts as of the date of the Sixth Street Acquisition. This intangible asset is called VOBA and is based on the actuarially estimated present value of future cash flows from the Company's insurance and investment contracts in-force as of the date of the transaction. The estimated fair value calculation of VOBA is based on certain assumptions, including equity market returns, mortality, persistency, expenses, discount rates, and other factors that the Company expects to experience in future years. Actual experience on the acquired contracts may vary from these projections and the recovery of VOBA is dependent upon the future profitability of the related business. The Company amortizes VOBA over EGPs and it is reviewed for recoverability quarterly. The fair value of certain acquired obligations of the Company exceeded the book value of assumed in-force policy liabilities resulting in additional reserve liabilities. These liabilities were increased to fair value, which is presented separately from VOBA as an additional insurance liability in other policyholder funds and benefits payable. The additional liability is amortized to income over the life of the underlying policies. Goodwill Goodwill represents the excess of the acquisition cost of an acquired business over the fair value of assets acquired and liabilities assumed. Goodwill is not amortized but is tested for impairment at the entity or reporting unit level annually or when events or circumstances arise, such as adverse changes in the business climate, that would more likely than not reduce the fair value of the entity or a reporting unit below its carrying value. Our methodology for conducting this goodwill impairment testing contains both a qualitative and quantitative assessment. The Company has the option to initially perform an assessment of qualitative factors in order to determine whether it is more likely than not that the fair value of the entity or a reporting unit is less than its carrying amount. The qualitative factors may include, but are not limited to, economic conditions, industry and market considerations, cost factors, overall financial performance of the entity or a reporting unit and other company and entity-level or reporting unit-specific events. If it is determined that it is more likely than not that the fair value of the entity or reporting unit is less than its carrying amount, we then perform the impairment evaluation using a more detailed quantitative assessment. If the carrying values of the entity or reporting units were to exceed their fair value under that quantitative assessment, the amount of the impairment would be calculated and goodwill would be adjusted accordingly. The Company could directly perform this quantitative assessment, bypassing the qualitative assessment and perform a quantitative impairment test. As a result of the quantitative review performed for the year ended December 31, 2022, the Company determined that the estimated fair value of TL exceeded its respective carrying value and that goodwill was not impaired. For the year ended December 31, 2021, the Company determined that the goodwill associated with TL was not impaired. For a discussion of goodwill from the Sixth Street Acquisition, refer to Note 7 - Goodwill and Other Intangible Assets. Other Intangible Assets Intangible assets with definite lives are amortized over the estimated useful life of the asset. Amortizing intangible assets primarily consists of internally developed software amortized over a period not to exceed seven years. Intangible assets with indefinite lives, primarily insurance licenses, are not amortized but are reviewed annually in the Company's impairment analysis. They will be tested for impairment more frequently if events or circumstances indicate the fair value of indefinitely lived intangibles is less than the carrying value. The Company determined during its reviews for December 31, 2022 and 2021 that its other indefinite-lived intangible assets and finite-lived intangible assets were not impaired. For a discussion of other intangible assets from the Sixth Street Acquisition, refer to Note 7 - Goodwill and Other Intangible Assets. Future Adoption of New Accounting Standards Troubled Debt Restructurings and Vintage Disclosure s The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2022-02, Financial Instruments – Credit Losses (Topic 326) – Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”) in March 2022, which eliminates the accounting guidance on troubled debt restructurings for creditors and amends the guidance on vintage disclosures. The amendments require that an entity evaluate whether the loan modification represents a new loan or a continuation of an existing loan, and introduce new requirements related to modifications made to borrowers experiencing financial difficulty. Additionally, ASU 2022-02 enhances disclosures for borrowers experiencing financial difficulty, by requiring current-period gross write-offs by year of origination for creditors with respect to loan refinancing and restructurings and internal risk ratings for financing receivables. ASU 2022-02 is effective for annual periods beginning after December 15, 2022 and interim periods within those annual periods, with early adoption permitted. The Company will adopt the amendments of ASU 2022-02 prospectively in the first quarter of 2023 and does not expect it to have a material impact on the Company. Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions The FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”) in June 2022. ASU 2022-03 clarifies that a contractual sales restriction is not considered in measuring an equity security at fair value and to introduce new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value. ASU 2022-03 applies to both holders and issuers of equity and equity-linked securities measured at fair value. The amendments in ASU 2022-03 are effective for the Company in fiscal years beginning after December 15, 2023, and interim periods within those fiscal years, with early adopted permitted. The Company will adopt the provisions of ASU 2022-03 in the first quarter of 2024 and does not expect it to have a material impact on the Company. Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The FASB issued ASU 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”) in October 2021, which requires acquiring entities to apply Topic 606, Revenue from Contracts with Customers upon recognizing and measuring contract assets and liabilities in a business combination. This update is intended to improve comparability after a business combination, by providing consistent recognition and measurement of revenue contracts with customers acquired and not acquired in a business combination. ASU 2021-08 is effective for annual periods beginning after December 15, 2022 and interim periods within those annual periods, with early adoption permitted. The amendments in ASU 2021-08 should be applied prospectively. We will adopt the provisions of this ASU in the first quarter of 2023 and do not expect it to have a material impact on the Company. Targeted Improvements to the Accounting for Long Duration Contracts The FASB issued ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts ("ASU 2018-12") in August 2018, which impacts the existing recognition, measurement, presentation, and disclosure requirements for certain long-duration contracts issued by an insurance company. The guidance is intended to improve the timeliness of recognizing changes in the liability for future policy benefits ("LFPB"), by requiring annual or more frequent updates of insurance assumptions and modifying rates used to discount future cash flows. Further, the guidance seeks to improve the accounting for certain market-based options or guarantees associated with account balance contracts, simplify the amortization of DAC and other balances amortized on a basis consistent with DAC, and improve the effectiveness of the required disclosures. This guidance was amended through the issuance of ASU 2020-11, which deferred the effective date the Company is required to adopt the guidance to January 1, 2023 with early adoption permitted. Through the issuance of ASU 2022-05, an insurance entity is permitted, prior to the effective date, to exclude certain contracts from applying the amendments in ASU 2018-12, when those contracts have been derecognized because of a sale or disposal of an individual or a group of contracts or legal entities and in which the insurance entity has no significant continuing involvement with the derecognized contracts. The Company does not currently intend to apply this accounting policy election. The Company intends to use the full retrospective adoption method, as of the date of the Sixth Street Acquisition. The Company does not expect an impact to stockholder's equity as a result of the adoption of ASU 2018-12, due to the application of purchase accounting; whereby assets and liabilities were transacted at fair value as of the date of the acquisition. Upon the adoption of ASU 2018-12, the change in the carrying value of insurance assets and liabilities as of July 1, 2021 are recorded with an equal and offsetting adjustment to VOBA or an additional reserve. Refer below for further discussion of other impacts upon adoption to the new standard. The adoption is expected to have a material effect on the Company’s results of operations due to the updating of cash flow assumptions for LFPB, recognition of changes to the fair value of market risk benefits (“MRB”), and the change in amortization methodology for DAC and other DAC-like balances. The Company has made key accounting policy decisions, including insurance policy groupings for recognition and measurement of LFPB, discount rate methodology, development of liability cash flow and claim expense assumptions, and DAC and other DAC-like amortization methodology. Outlined below are four key areas of change, although there are other less significant policy changes not noted below. Amended Topic Description Adoption Method and Transition Impact Cash flow and discount rate assumptions underlying insurance liabilities For nonparticipating traditional and limited-payment insurance contracts, the Company will evaluate, at least annually in the same fiscal quarter, as to whether an update to cash flow assumptions is needed. The Company will update the cash flows used to measure the LFPB, for both changes in future assumptions and actual experience, at least annually. The updating of cash flows impacts the amount of the deferred profit liability (“DPL”) recorded for limited-payment contracts. The DPL will be adjusted concurrently with any updating of the LFPB. Cash flows are required to be discounted with an upper-medium grade (or low credit risk) fixed-income instrument yield, with the effect of discount rate changes on the liability recorded in other comprehensive income (“OCI”). The discount rate utilized is intended to reflect the duration characteristics of the corresponding insurance liabilities. The Company will obtain yield curves and spreads for a range of tenors to determine spot yields to discount the cash flows of the insurance liabilities as of each valuation date. The Company will adopt the guidance for LFPB, as of the date of the Sixth Street Acquisition. As of the acquisition date, the Company expects there will be a decrease to LFPB (and the associated reinsurance recoverable), which will be offset by a net increase to an additional reserve. This is due to the application of purchase accounting associated with the Sixth Street Acquisition, which employed lower discount rates for the fair value calculations than the required discount rates to value the cash flows on the insurance liabilities under ASU 2018-12. MRB The Company currently offers and assumes certain guarantees and product features on variable annuity and FIA products, which protect the contractholder from other-than-nominal capital market risk and expose the Company to other-than-nominal capital market risk. These MRB features are required to be measured at fair value with changes in fair value recorded in net income, with the exception of the changes in MRB liabilities attributable to a change in an entity’s nonperformance risk, which is required to be recognized in OCI. For products that are reinsured, the portion of the change in MRB attributable to changes in the reinsurer’s nonperformance risk is recognized in income. The Company shall maximize the use of relevant observable information and minimize the use of unobservable information in determining the balance of the MRB upon adoption. The Company will adopt the guidance for MRB using the full retrospective method. As of the acquisition date, the Company expects there to be an increase to the MRB liability (and the associated reinsurance recoverable) and a decrease to VOBA, as a result of the difference between the establishment of the MRB recorded at fair value under ASU 2018-12 and reserves previously recorded for those benefits. Amortization of DAC and other DAC-like balances The Company will amortize DAC and other DAC-like balances on a constant-level basis over the expected term for a group of contracts consistent with the groupings used in estimating the associated LFPB. The constant-level basis for the group approximates a pattern of straight-line amortization at an individual contract level by using a method specific to the underlying product. The amortization rate utilized is calculated at the end of the current reporting period, including actual experience and any assumption updates. The revised amortization rate is applied prospectively from the beginning of the current reporting period. As a result of amortizing DAC and other DAC-like balances on a constant-level basis, the Company does not expect a significant impact upon the adoption of ASU 2018-12. Reporting and Disclosures ASU 2018-12 requires certain enhanced presentation and disclosures including disaggregated rollforwards for LFPB, policyholder account balances, MRB, separate account liabilities, DAC and other DAC-like balances, and information about significant inputs, judgments and methods used in the LFPB measurement. The enhanced disclosures are intended to improve the ability of users of the financial statements to evaluate the timing, amount, and uncertainty of cash flows arising from long-duration contracts. The Company’s implementation efforts and the evaluation of the impacts of the guidance on its consolidated financial statements, as well as its systems, processes, and controls, continue to progress. Given the nature and extent of the required changes to a significant portion of the Company’s operations, the adoption of this guidance is expected to have a material impact on its financial position and results of operations. In addition, there will be a significant increase in required disclosures. Significant Accounting Policies The Company’s significant accounting policies are as follows: Segment Information The Company has no reportable segments and its principal products and services are comprised of variable, fixed and payout annuities, FIAs, and private-placement life insurance. The Company's determination that it has no reportable segments is based on the fact that the Company's chief operating decision maker reviews the Company's financial performance at a consolidated level. Revenue Recognition For investment and universal life-type contracts, the amounts collected from policyholders are considered deposits and are not included in revenue. Policy charges and fee income for variable annuity, FIA, deferred annuity and other universal life-type contracts primarily consists of policy charges for policy administration, cost of insurance charges and surrender charges assessed against policyholders’ account balances and are recognized in the period in which services are provided. For the Company’s traditional life products, premiums are recognized as revenue when due from policyholders. Investments Overview The Company’s investments in fixed maturities include bonds, structured securities, redeemable preferred stock and commercial paper. Most of these investments are classified as AFS and are carried at fair value, net of ACL. The after-tax difference between fair value and cost or amortized cost is reflected in stockholder's equity as a component of AOCI, after adjustments for the effect of VOBA and reserve adjustments. Equity securities are measured at fair value with any changes in valuation reported in net income. Mortgage loans are recorded at the outstanding principal balance adjusted for amortization of premiums or discounts, net of ACL. Policy loans are carried at outstanding balance. Limited partnerships and other alternative investments are reported at their carrying value and are primarily accounted for under the equity method with the Company’s share of earnings included in net investment income. Recognition of income related to limited partnerships and other alternative investments accounted for under the equity method is delayed due to the availability of the related financial information, as private equity and other funds are generally on a three-month lag and hedge funds generally on a one-month lag. Accordingly, income for the year ended December 31, 2022 (Successor Company), the period of July 1, 2021 to December 31, 2021 (Successor Company), the period of January 1, 2021 to June 30, 2021 (Predecessor Company), and the year ended December 31, 2020 (Predecessor Company), may not include the full impact of current year changes in valuation of the underlying assets and liabilities of the funds, which are generally obtained from the limited partnerships and other alternative investments’ general partners. Other investments consist of derivative instruments which are carried at fair value and real estate acquired in satisfaction of debt. Short-term investments, including cash equivalents, are carried at amortized cost, which approximates fair value. Fair Value Option ("FVO") The Company has elected the FVO for rated feeder fund investments, where a single entity issues both debt securities and equity interests and the Company owns both the debt security and equity interest portions of the investment. The Company has elected the FVO for these investments to reflect changes in fair value in earnings and to align the timing of the fair value measurement for its multiple investments in that single entity. Credit Losses An ACL is recognized as an estimate of credit losses expected over the life of financial instruments, such as mortgage loans, reinsurance recoverables |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company carries certain financial assets and liabilities at estimated fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants. Our fair value framework includes a hierarchy that gives the highest priority to the use of quoted prices in active markets, followed by the use of market observable inputs, followed by the use of unobservable inputs. The fair value hierarchy levels are as follows: Level 1 Fair values based primarily on unadjusted quoted prices for identical assets or liabilities, in active markets that the Company has the ability to access at the measurement date. Level 2 Fair values primarily based on observable inputs, other than quoted prices included in Level 1, or based on prices for similar assets and liabilities. Level 3 Fair values derived when one or more of the significant inputs are unobservable (including assumptions about risk). With little or no observable market, the determination of fair values uses considerable judgment and represents the Company’s best estimate of an amount that could be realized in a market exchange for the asset or liability. Also included are securities that are traded within illiquid markets and/or priced by independent brokers. The Company will classify the financial asset or liability by level based upon the lowest level input that is significant to the determination of the fair value. In most cases, both observable inputs (e.g., changes in interest rates) and unobservable inputs (e.g., changes in risk assumptions) are used to determine fair values that the Company has classified within Level 3. Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of December 31, 2022 (Successor Company) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs Significant Unobservable Inputs (Level 3) Assets Accounted for at Fair Value on a Recurring Basis Fixed maturities, AFS Asset backed securities ("ABS") $ 254 $ — $ 213 $ 41 Collateralized loan obligations ("CLOs") 676 — 567 109 Commercial mortgage-backed securities ("CMBS") 1,514 — 1,237 277 Corporate 10,241 — 9,622 619 Foreign government/government agencies 315 — 311 4 Municipal 1,040 — 1,039 1 Residential mortgage-backed securities ("RMBS") 417 — 400 17 U.S. Treasuries 926 — 926 — Total fixed maturities, AFS 15,383 — 14,315 1,068 Fixed maturities, FVO 331 — 25 306 Equity securities, at fair value 179 — 155 24 Limited partnerships and other alternative investments, FVO 58 — — 58 Derivative assets Foreign exchange derivatives 1 — 1 — Macro hedge program 194 — 39 155 Total derivative assets [1] 195 — 40 155 Short-term investments 1,489 742 610 137 Reinsurance recoverable for FIA options 49 — — 49 Reinsurance recoverable for FIA embedded derivative 288 — — 288 Reinsurance recoverable for GMWB (131) — — (131) Modified coinsurance reinsurance contracts 129 — 129 — Separate account assets [2] 86,122 52,642 33,139 53 Total assets accounted for at fair value on a recurring basis $ 104,092 $ 53,384 $ 48,413 $ 2,007 (Liabilities) Accounted for at Fair Value on a Recurring Basis Other policyholder funds and benefits payable FIA embedded derivative $ (385) $ — $ — $ (385) GMWB embedded derivative 131 — — 131 Total other policyholder funds and benefits payable (254) — — (254) Derivative liabilities Credit derivatives 4 — 4 — Foreign exchange derivatives 14 — 14 — Interest rate derivatives (1) — (1) — Macro hedge program 17 — 24 (7) Total derivative liabilities [3] 34 — 41 (7) Funds withheld on modified coinsurance reinsurance contracts 1,481 — 1,518 (37) Total (liabilities) accounted for at fair value on a recurring basis $ 1,261 $ — $ 1,559 $ (298) Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of December 31, 2021 (Successor Company) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs Significant Unobservable Inputs Assets Accounted for at Fair Value on a Recurring Basis Fixed maturities, AFS ABS $ 258 $ — $ 258 $ — CLOs 944 — 785 159 CMBS 2,335 — 2,059 276 Corporate 13,357 39 12,653 665 Foreign government/government agencies 362 — 362 — Municipal 1,456 — 1,455 1 RMBS 811 — 737 74 U.S. Treasuries 1,448 127 1,321 — Total fixed maturities, AFS 20,971 166 19,630 1,175 Equity securities, at fair value 203 11 171 21 Derivative assets Credit derivatives 2 — 2 — Foreign exchange derivatives 7 — 7 — Interest rate derivatives 18 — 15 3 Macro hedge program 16 — (11) 27 Total derivative assets [1] 43 — 13 30 Short-term investments 1,254 744 435 75 Reinsurance recoverable for GMWB (8) — — (8) Separate account assets [2] 110,021 69,089 40,449 79 Total assets accounted for at fair value on a recurring basis $ 132,484 $ 70,010 $ 60,698 $ 1,372 (Liabilities) Accounted for at Fair Value on a Recurring Basis Other policyholder funds and benefits payable FIA embedded derivative $ (655) $ — $ — $ (655) GMWB embedded derivative 80 $ — $ — $ 80 Total other policyholder funds and benefits payable (575) — — (575) Derivative liabilities Foreign exchange derivatives 2 — 2 — Interest rate derivatives (25) — (22) (3) Macro hedge program (229) — (14) (215) Total derivative liabilities [3] (252) — (34) (218) Funds withheld on modified coinsurance reinsurance contracts 15 — 15 — Total (liabilities) accounted for at fair value on a recurring basis $ (812) $ — $ (19) $ (793) [1] Includes derivative instruments in a net positive fair value position (derivative asset) after consideration of the accrued interest and impact of collateral posting requirements which may be imposed by agreements and applicable law. See footnote 3 to this table for derivative liabilities. [2] Approximately $1.1 billion and $1.6 billion of investment sales receivables, as of December 31, 2022 and 2021 (Successor Company), respectively, are excluded from this disclosure requirement because they are trade receivables in the ordinary course of business where the carrying amount approximates fair value. Included in the total fair value amount are $289 and $404 of investments, as of December 31, 2022 and 2021 (Successor Company), respectively, for which the fair value is estimated using the net asset value per unit as a practical expedient which are excluded from the disclosure requirement to classify amounts in the fair value hierarchy. [3] Includes derivative instruments in a net negative fair value position (derivative liability) after consideration of the accrued interest and impact of collateral posting requirements which may be imposed by agreements and applicable law. Fixed Maturities, Equity Securities, Limited Partnerships and Other Alternative Investments for Which the Company has Elected the FVO, Short-term Investments, and Freestanding Derivatives, Including the Underlying Investments Within the Funds Withheld Liability Valuation Techniques The Company generally determines fair values using valuation techniques that use prices, rates, and other relevant information evident from market transactions involving identical or similar instruments. Valuation techniques also include, where appropriate, estimates of future cash flows that are converted into a single discounted amount using current market expectations. The Company uses a "waterfall" approach comprised of the following pricing sources and techniques, which are listed in priority order: • Quoted prices, unadjusted, for identical assets or liabilities in active markets, which are classified as Level 1. • Prices from third-party pricing services, which primarily utilize a combination of techniques. These services utilize recently reported trades of identical, similar, or benchmark securities making adjustments for market observable inputs available through the reporting date. If there are no recently reported trades, they may use a discounted cash flow technique to develop a price using expected cash flows based upon the anticipated future performance of the underlying collateral discounted at an estimated market rate. Both techniques develop prices that consider the time value of future cash flows and provide a margin for risk, including liquidity and credit risk. Most prices provided by third-party pricing services are classified as Level 2 because the inputs used in pricing the securities are observable. However, some securities that are less liquid or trade less actively are classified as Level 3. Additionally, certain long-dated securities, such as municipal securities and bank loans, include benchmark interest rate or credit spread assumptions that are not observable in the marketplace and are thus classified as Level 3. • Internal matrix pricing is a valuation process internally developed for private placement securities for which the Company is unable to obtain a price from a third-party pricing service. Internal pricing matrices determine credit spreads that, when combined with risk-free rates, are applied to contractual cash flows to develop a price. The Company develops credit spreads using market based data for public securities adjusted for credit spread differentials between public and private securities, which are obtained from a survey of multiple private placement brokers. The market-based reference credit spread considers the issuer’s sector, financial strength, and term to maturity, using an independent public security index, while the credit spread differential considers the non-public nature of the security. Securities priced using internal matrix pricing are classified as Level 2 because the significant inputs are observable or can be corroborated with observable data. • Independent broker quotes, which are typically non-binding use inputs that can be difficult to corroborate with observable market based data. Brokers may use present value techniques using assumptions specific to the security types, or they may use recent transactions of similar securities. Due to the lack of transparency in the process that brokers use to develop prices, valuations that are based on independent broker quotes are classified as Level 3. The fair value of freestanding derivative instruments is determined primarily using a discounted cash flow model or option model technique and incorporates counterparty credit risk. In some cases, quoted market prices for exchange-traded and OTC cleared derivatives may be used and in other cases independent broker quotes may be used. The pricing valuation models primarily use inputs that are observable in the market or can be corroborated by observable market data. The valuation of certain derivatives may include significant inputs that are unobservable, such as volatility levels, and reflect the Company’s view of what other market participants would use when pricing such instruments. Unobservable market data is used in the valuation of customized derivatives that are used to hedge certain GMWB variable annuity riders. See the section “GMWB and FIA Embedded, Customized, and Reinsurance Derivatives” below for further discussion of the valuation model used to value these customized derivatives. Valuation Inputs Quoted prices for identical assets in active markets are considered Level 1 and consist of on-the-run U.S. Treasuries, money market funds, exchange-traded equity securities, open-ended mutual funds, certain short-term investments, and exchange traded futures and option contracts. Valuation Inputs Used in Levels 2 and 3 Measurements for Securities and Freestanding Derivatives Level 2 Level 3 Fixed Maturity Investments Structured securities (includes ABS, CLOs, CMBS and RMBS) • Benchmark yields and spreads Other inputs for ABS, CLOs, and RMBS: • Independent broker quotes Other inputs for less liquid securities or those that trade less actively, including subprime RMBS: Corporate • Benchmark yields and spreads Other inputs for investment grade privately placed securities that utilize internal matrix pricing: • Independent broker quotes Other inputs for below investment grade privately placed securities and private bank loans: U.S Treasuries, Municipals, and Foreign government/government agencies • Benchmark yields and spreads • Credit spreads beyond observable curve Equity Securities • Quoted prices in markets that are not active • For privately traded equity securities, internal discounted cash flow models utilizing earnings multiples or other cash flow assumptions that are not observable Limited Partnerships and Other Alternative Investments, FVO Not applicable • Prices of privately traded securities Short-term Investments • Benchmark yields and spreads • Independent broker quotes Derivatives Credit derivatives • Swap yield curve Not applicable Foreign exchange derivatives • Swap yield curve Not applicable Interest rate derivatives • Swap yield curve • Independent broker quotes Significant Unobservable Inputs for Level 3 - Securities As of December 31, 2022 (Successor Company) Assets Accounted for at Fair Value on a Recurring Basis Fair Value Predominant Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] CLOs [4] $ 109 Discounted cash flows Spread 55bps 337bps 325bps Decrease CMBS 277 Discounted cash flows Spread (encompasses 419bps 1,001bps 534bps Decrease Corporate [4] 901 Discounted cash flows Spread 71bps 719bps 309bps Decrease RMBS [3] 13 Discounted cash flows Spread [6] 62bps 227bps 138bps Decrease Constant prepayment rate [6] 2% 10% 6% Decrease [5] Constant default rate [6] 1% 4% 2% Decrease Loss severity [6] 10% 65% 25% Decrease As of December 31, 2021 (Successor Company) Assets Accounted for at Fair Value on a Recurring Basis Fair Value Predominant Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] CLOs $ 159 Discounted cash flows Spread 234bps 258bps 257bps Decrease CMBS 276 Discounted cash flows Spread (encompasses 203bps 637bps 303bps Decrease Corporate [4] 623 Discounted cash flows Spread 125bps 1,227bps 278bps Decrease RMBS [3] 65 Discounted cash flows Spread [6] 39bps 229bps 90bps Decrease Constant prepayment rate [6] 4% 16% 8% Decrease [5] Constant default rate [6] 1% 4% 3% Decrease Loss severity [6] —% 100% 64% Decrease [1] The weighted average is determined based on the fair value of the securities. [2] Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table. [3] Excludes securities for which the Company bases fair value on broker quotations. [4] Excludes securities for which the Company bases fair value on broker quotations; however, included are broker-priced lower-rated private placement securities for which the Company receives spread and yield information to corroborate the fair value. Amounts for December 31, 2022 include $306 of fixed maturities, FVO. [5] Decrease for above market rate coupons and increase for below market rate coupons. [6] Generally, a change in the assumption used for the constant default rate would have been accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for constant prepayment rate and would have resulted in wider spreads. The tables below exclude certain securities for which fair values are predominately based on independent broker quotes. Significant Unobservable Inputs for Level 3 - Freestanding Derivatives As of December 31, 2022 (Successor Company) Fair Value Predominant Valuation Technique Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] Macro hedge program [3] Equity options $ 65 Option model Equity volatility 18% 64% 26% Increase Interest rate swaption 97 Option model Interest rate volatility 1% 1% 1% Increase As of December 31, 2021 (Successor Company) Fair Value Predominant Valuation Technique Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] Interest rate derivatives Interest rate swaps $ 3 Discounted cash flows Swap curve beyond 30 years 2% 2% 2% Decrease Interest rate swaptions (3) Option Model Interest rate volatility 1% 1% 1% Increase Macro hedge program [3] Equity options (195) Option model Equity volatility 17% 63% 28% Increase Interest rate swaption 7 Option model Interest rate volatility 1% 1% 1% Increase [1] The weighted average is determined based on the fair value of the securities. [2] Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table. Changes are based on long positions, unless otherwise noted. Changes in fair value will be inversely impacted for short positions. [3] Excludes derivatives for which the Company bases fair value on broker quotations. GMWB and FIA Embedded, Customized and Reinsurance Derivatives GMWB Embedded Derivatives The Company formerly offered certain variable annuity products with GMWB riders that provide the policyholder with a GRB which is generally equal to premiums less withdrawals. If the policyholder’s account value is reduced to a specified level through a combination of market declines and withdrawals but the GRB still has value, the Company is obligated to continue to make annuity payments to the policyholder until the GRB is exhausted. When payments of the GRB are not life-contingent, the GMWB represents an embedded derivative carried at fair value reported in other policyholder funds and benefits payable on the Consolidated Balance Sheets with changes in fair value reported in net realized capital gains (losses). FIA Embedded Derivative The Company assumed through reinsurance FIA contracts that provide the policyholder with benefits that depend on the performance of market indices. Benefits in excess of contract guarantees represent an embedded derivative carried at fair value and reported in other policyholder funds and benefits payable on the Consolidated Balance Sheets with changes in fair value reported in net realized capital gains (losses). Freestanding Customized Derivatives The Company previously held freestanding customized derivative contracts to provide protection from certain capital markets risks for the remaining term of specified blocks of GMWB riders written on a direct basis. These customized derivatives are based on policyholder behavior assumptions specified at the inception of the derivative contracts. The Company retained the risk for differences between assumed and actual policyholder behavior and between the performance of the actively managed funds underlying the separate accounts and their respective indices. These derivatives were reported on the Consolidated Balance Sheets within other investments or other liabilities, as appropriate, after considering the impact of master netting agreements. GMWB Reinsurance Derivative The Company has reinsurance arrangements with affiliated and unaffiliated reinsurers in place to transfer a portion of its risk of loss due to GMWB. Certain of these arrangements are recognized as derivatives carried at fair value and reported in reinsurance recoverables on the Consolidated Balance Sheets. Changes in the fair value of the reinsurance agreements are reported in net realized capital gains (losses). Valuation Techniques Fair values for FIA and GMWB embedded derivatives, freestanding customized derivatives and reinsurance derivatives are classified as Level 3 in the fair value hierarchy and are calculated using internally developed models that utilize significant unobservable inputs because active, observable markets do not exist for these items. In valuing the GMWB embedded derivative, the Company attributes to the derivative a portion of the expected fees to be collected over the expected life of the contract from the contract holder equal to the present value of future GMWB claims. The excess of fees collected from the contract holder in the current period over the portion of fees attributed to the embedded derivative in the current period are associated with the host variable annuity contract and reported in fee income. Valuation Inputs The fair value for each of the non-life contingent GMWBs, FIA embedded derivative, the freestanding customized derivatives and the GMWB reinsurance derivative is calculated as an aggregation of the following components: Best Estimate Benefits; Credit Standing Adjustment; and Margins. The Company believes the aggregation of these components results in an amount that a market participant in an active liquid market would require, if such a market existed, to assume the risks associated with the guaranteed minimum benefits and the related reinsurance and customized derivatives. Each component described in the following discussion is unobservable in the marketplace and requires subjectivity by the Company in determining its value. Best Estimate Benefits The Best Estimate Benefits are calculated based on actuarial and capital market assumptions related to projected cash flows, including the present value of benefits and related contract charges, over the lives of the contracts, incorporating unobservable inputs including expectations concerning policyholder behavior. Credit Standing Adjustment The credit standing adjustment is an estimate of the adjustment to the fair value that market participants would require in determining fair value to reflect the risk that GMWB benefit obligations or the GMWB reinsurance recoverables will not be fulfilled. The Company incorporates a blend of estimates of peer company and reinsurer bond spreads and credit default spreads from capital markets, adjusted for market recoverability. Margins The behavior risk margin adds a margin that market participants would require, in determining fair value, for the risk that the Company’s assumptions about policyholder behavior could differ from actual experience. The behavior risk margin is calculated by taking the difference between adverse policyholder behavior assumptions and best estimate assumptions. Valuation Inputs Used in Levels 2 and 3 Measurements for GMWB and FIA Embedded, Customized and Reinsurance Derivatives Level 2 Level 3 • Risk-free rates as represented by the Eurodollar futures, LIBOR deposits and swap rates to derive forward curve rates • Correlations of 10 years of observed historical returns across underlying well-known market indices • Correlations of historical index returns compared to separate account fund returns • Equity index levels • Market implied equity volatility assumptions Assumptions about policyholder behavior, including: Significant Unobservable Inputs for Level 3 GMWB Embedded, Customized and Reinsurance Derivatives As of December 31, 2022 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Impact of Increase in Input Withdrawal utilization [2] —% 100% 62% Increase Withdrawal rates [3] 4% 8% 6% Increase Lapse rates [4] —% 40% 3% Decrease [8] Reset elections [5] —% 99% 10% Decrease [8] Equity volatility [6] 18% 28% 23% Increase Credit standing adjustment [7] 0.1% 0.3% 0.3% Decrease As of December 31, 2021 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Impact of Increase in Input Withdrawal utilization [2] —% 100% 62% Increase Withdrawal rates [3] 4% 8% 6% Increase Lapse rates [4] —% 48% 5% Decrease [8] Reset elections [5] —% 99% 8% Decrease [8] Equity volatility [6] 11% 25% 21% Increase Credit standing adjustment [7] —% 0.2% 0.1% Decrease Significant Unobservable Inputs for Level 3 FIA Embedded Derivative As of December 31, 2022 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Average Impact of Increase in Input Withdrawal rates [3] —% 15.9% 1.7% Decrease Lapse rates [4] 1.0% 25.0% 6.5% Decrease Option budgets [9] 0.5% 3.8% 1.6% Increase Credit standing adjustment [7] —% 0.2% 0.1% Decrease As of December 31, 2021 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Average Impact of Increase in Input Withdrawal rates [3] —% 16% 2% Decrease Lapse rates [4] 1% 34% 6% Decrease Option budgets [9] 1% 4% 2% Increase Credit standing adjustment [7] —% 0.1% 0.1% Decrease [1] Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table. [2] Range represents assumed percentages of policyholders taking withdrawals. [3] Range represents assumed annual percentage of allowable amount withdrawn. [4] Range represents assumed annual percentages of policyholders electing a full surrender. [5] Range represents assumed annual percentages of eligible policyholders electing to reset their guaranteed benefit base. [6] Range represents implied market volatilities for equity indices based on multiple pricing sources. [7] Range represents Company credit spreads, adjusted for market recoverability. [8] The impact may be an increase for some contracts, particularly those with out of the money guarantees. [9] Range represents assumed annual budget for index options. Separate Account Assets Separate account assets are primarily invested in mutual funds. Other separate account assets include fixed maturities, limited partnerships, equity securities, short-term investments and derivatives that are valued in the same manner, and using the same pricing sources and inputs, as those investments held by the Company. For limited partnerships in which fair value represents the separate account’s share of the NAV, 53% and 40% were subject to significant liquidation restrictions as of December 31, 2022 and 2021 (Successor Company), respectively. Total limited partnerships that do not allow any form of redemption were 0% as of December 31, 2022 (Successor Company) and 2021 (Successor Company), respectively. Separate account assets classified as Level 3 primarily include long-dated bank loans, subprime RMBS and commercial mortgage loans. Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs The Company uses derivative instruments to manage the risk associated with certain assets and liabilities. However, the derivative instrument may not be classified within the same fair value hierarchy level as the associated asset or liability. Therefore, the realized and unrealized gains and losses on derivatives reported in the Level 3 rollforwards may be offset by realized and unrealized gains and losses of the associated assets and liabilities in other line items of the financial statements. The following tables present a reconciliation of the beginning and ending balances for fair value measurements for the year ended December 31, 2022 (Successor Company), for which the Company used significant unobservable inputs (Level 3): Fair Value Rollforwards for Financial Instruments Classified as Level 3 Total Realized/Unrealized Gains (Losses) Fair Value as of December 31, 2021 Included in Net Income [1] [2] [6] Included in OCI [3] Purchases Settlements Sales Transfers into Transfers out of Level 3 [4] Fair Value as of December 31, 2022 Assets Fixed maturities, AFS ABS $ — $ — $ (2) $ 52 $ (6) $ — $ — $ (3) $ 41 CLOs 159 — (1) 80 (54) — — (75) 109 CMBS 276 — (26) 68 (34) — — (7) 277 Corporate 665 (2) (43) 132 (137) (10) 20 (6) 619 Foreign govt./govt. agencies — — (1) 5 — — — — 4 Municipal 1 — — — — — — — 1 RMBS 74 — (1) 22 (26) (19) — (33) 17 Total fixed maturities, AFS 1,175 (2) (74) 359 (257) (29) 20 (124) 1,068 Fixed Maturities, FVO — (21) — 327 — — — — 306 Equity securities, at fair value 21 6 — 8 (11) — — — 24 LPs and other alternative investments, FVO — 16 — 42 — — — — 58 Freestanding derivatives Interest rate — 22 — — (22) — — — — Macro hedge program (188) 74 — 351 (89) — — — 148 Total freestanding derivatives [5] (188) 96 — 351 (111) — — — 148 Short-term investments 75 — — 192 (80) — — (50) 137 Reinsurance recoverable for FIA options — (22) — 123 (52) — — — 49 Reinsurance recoverable for FIA embedded derivative — — — 288 — — — — 288 Reinsurance recoverable for GMWB (8) (14) — — (109) — — — (131) Separate accounts 79 (2) — 99 — (23) — (100) 53 Total assets $ 1,154 $ 57 $ (74) $ 1,789 $ (620) $ (52) $ 20 $ (274) $ 2,000 (Liabilities) Other policyholder funds and benefits payable FIA embedded derivative $ (655) $ 256 $ — $ (13) $ 27 $ — $ — $ — $ (385) GMWB embedded derivative 80 88 — — (37) — — — 131 Total other policyholder funds and benefits payable (575) 344 — (13) (10) — — — (254) Funds withheld on modified coinsurance reinsurance contracts — — — (37) — — — — (37) Total liabilities $ (575) $ 344 $ — $ (50) $ (10) $ — $ — $ — $ (291) The following table presents a reconciliation of the beginning and ending balances for fair value measurements for the period of July 1, 2021 to December 31, 2021 (Successor Company), for which the Company used significant unobservable inputs (Level 3): Fair Value Rollforwards for Financial Instruments Classified as Level 3 Total Realized/Unrealized Gains (Losses) Fair Value as of July 1, 2021 Included in Net Income [1] [2] [6] Included in OCI [3] Purchases Settlements Sales Transfers into Transfers out of Level 3 [4] Fair Value as of December 31, 2021 Assets Fixed maturities, AFS ABS $ 8 $ — $ — $ — $ — $ — $ — $ (8) $ — CLOs 248 — — 34 (64) — — (59) 159 CMBS 143 — (2) 136 (1) — — — 276 Corporate 460 3 (2) 245 (30) (11) — — 665 Municipal — — — — — — 1 — 1 RMBS 108 — — 29 (29) (19) — (15) 74 Total fixed maturities, AFS 967 3 (4) 444 (124) (30) 1 (82) 1,175 Equity securities, at fair value 33 20 — — (32) — — — 21 Freestanding derivatives Interest rate 2 2 — (4) — — — — — Total freestanding derivatives [5] 2 2 — (4) — — — — — Reinsurance recoverable for GMWB (6) (8) — — 6 — — — (8) Short-term investments 14 — — 88 (27) — — — 75 Separate accounts 15 — — 71 — (5) 4 (6) 79 Total assets $ 1,025 $ 17 $ (4) $ 599 $ (177) $ (35) $ 5 $ (88) $ 1,342 Liabilities Freestanding derivatives Macro hedge program $ (237) $ 153 $ — $ (1) $ (103) $ — $ — $ — $ (188) Total freestanding derivatives [5] (237) 153 — (1) (103) — — — (188) Other policyholder funds and benefits payable FIA embedded derivative — — — (655) — — — — (655) Guaranteed withdrawal benefits 77 29 — — (26) — — — 80 Total other policyholder funds and benefits payable 77 29 — (655) (26) — — — (575) Total liabilities $ (160) $ 182 $ — $ (656) $ (129) $ — $ — $ — $ (763) The following table presents a reconciliation of the beginning and ending balances for fair value measurements for the six months ended June 30, 2021 (Predecessor Company), for which the Company used significant unobservable inputs (Level 3): Fair Value Rollforwards for Financial Instruments Classified as Level 3 Total Realized/Unrealized Gains (Losses) Fair Value as of December 31, 2020 Included in Net Income [1] [2] [6] Included in OCI [3] Purchases Settlements Sales Transfers into Transfers out of Level 3 [4] Fair Value as of June 30, 2021 Assets Fixed maturities, AFS ABS $ — $ — $ — $ 10 $ — $ — $ — $ (2) $ 8 CLOs 259 — — 50 (36) — — (25) 248 CMBS 54 — 2 90 — — 2 (5) 143 Corporate 328 — (6) 132 (23) (9) 53 (15) 460 RMBS 154 — 1 5 (34) (15) — (3) 108 Total fixed maturities, AFS 795 — (3) 287 (93) (24) 55 (50) 967 Equity securities, at fair value 32 — — 1 — — — — 33 Freestanding derivatives Interest rate 2 — — — — — — — 2 Total freestanding derivatives [5] 2 — — — — — — — 2 Reinsurance recoverable for GMWB 7 (19) — — 6 — — — (6) Short-term investments 22 — — 2 (10) — — — 14 Separate accounts 20 — — 2 — (4) 2 (5) 15 Total assets $ 878 $ (19) $ (3) $ 292 $ (97) $ (28) $ 57 $ (55) $ 1,025 Liabilities Freestanding derivatives Macro hedge program $ (441) $ 385 $ — $ 12 $ (193) $ — $ — $ — $ (237) Total freestanding derivatives [5] (441) 385 — 12 (193) — — — (237) Other policyholder funds and benefits payable Guaranteed withdrawal benefits 21 82 — — (26) — — — 77 Total other policyholder funds and benefits payable 21 82 — — (26) — — — 77 Total liabilities $ (420) $ 467 $ — $ 12 $ (219) $ — $ — $ — $ (160) [1] The Company classifies realized and unrealized gains (losses) on FIA and GMWB reinsurance derivatives and GMWB embedded derivatives as unrealized gains (losses) for purposes of disclosure in this table because it is impracticable to track on a contract-by-contract basis the realized gains (losses) for these derivatives and embedded derivatives. [2] Amounts in these columns are generally reported in net realized capital gains (losses). The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amoun |
Investments
Investments | 12 Months Ended |
Dec. 31, 2022 | |
Investments [Abstract] | |
Investments | Investments Net Investment Income Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 (Before tax) Fixed maturities [1] $ 620 $ 174 $ 243 $ 518 Equity securities 10 10 2 7 Mortgage loans 74 32 45 92 Policy loans 82 36 40 82 Limited partnerships and other alternative investments 168 259 216 130 Other [2] (146) 1 1 13 Investment expense (30) (14) (13) (26) Total net investment income $ 778 $ 498 $ 534 $ 816 [1] Includes net investment income on short-term investments and excludes amounts related to fixed maturities where the FVO was elected. [2] Includes income from derivatives that qualify for hedge accounting and hedge fixed maturities along with income on assets from the COLI block of business. Includes a portion of the change in funds withheld liability, due to the risk-free rate on the host contract on modified coinsurance. Net Realized Capital Gains (Losses) Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 (Before tax) Gross gains on sales $ 2 $ 14 $ 55 $ 166 Gross losses on sales (532) (20) (8) (32) Net realized gains (losses) on sales of equity securities 5 19 — — Change in net unrealized gains (losses) on equity securities [1] (24) (2) — 1 Net credit losses on fixed maturities, AFS (1) — — (1) Change in ACL on mortgage loans (3) — 6 (8) Intent-to-sell impairments — — — (6) Change in fair value of fixed maturities, FVO (21) Change in fair value of LPs and other alternative investments, FVO 16 FIA embedded derivative 270 FIA hedging program (247) GMWB derivatives, net 82 Variable annuity macro hedge program (1) (67) (243) (414) Transactional foreign currency revaluation — — — 3 Non-qualifying foreign currency derivatives 7 5 (2) (7) Modified coinsurance reinsurance derivative contracts 1,136 15 22 (50) Other, net [2] (290) 16 (72) 192 Net realized capital gains (losses) $ 317 $ (20) $ (242) $ (74) [1] The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of December 31, 2022, were $(24) for the year ended December 31, 2022 (Successor Company). The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of December 31, 2021, were $(3) for the period of July 1, 2021 to December 31, 2021 (Successor Company). The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of June 30, 2021 , were $1 for the six months ended June 30, 2021 (Predecessor Company). The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of December 31, 2020 were $4 for year ended December 31, 2020 (Predecessor Company). [2] Includes gains (losses) on non-qualifying derivatives, excluding foreign currency derivatives, of $833 for the year ended December 31, 2022 (Successor Company), $37 for the period of July 1, 2021 to December 31, 2021 (Successor Company), $(54) for the six months ended June 30, 2021 (Predecessor Company) and $149 for the year ended December 31, 2020 (Predecessor). Sales of AFS Securities Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Fixed maturities, AFS Sale proceeds $ 5,897 $ 2,372 $ 1,007 $ 1,789 Gross gains 2 14 55 165 Gross losses (531) (16) (8) (31) Sales of fixed maturities, AFS in 2022 were primarily a result of strategic asset allocations, tactical changes to the portfolio driven by changing market conditions, and duration and liquidity management. Accrued Interest Receivable on Fixed Maturities, AFS and Mortgage Loans As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company reported accrued interest receivable related to fixed maturities, AFS of $183 and $178, respectively, and accrued interest receivable related to mortgage loans of $8 and $6, respectively. These amounts are recorded in other assets on the Consolidated Balance Sheets and are not included in the carrying value of the fixed maturities or mortgage loans. The Company does not include the current accrued interest receivable balance when estimating the ACL. The Company has a policy to write-off accrued interest receivable balances that are more than 90 days past due. Write-offs of accrued interest receivable are recorded as a credit loss component of realized capital gains and losses. Interest income on fixed maturities and mortgage loans is accrued unless it is past due over 90 days or management deems the interest uncollectible. Recognition and Presentation of Intent-to-Sell Impairments and ACL on Fixed Maturities, AFS The Company will record an "intent-to-sell impairment" as a reduction to the amortized cost of fixed maturities, AFS in an unrealized loss position if the Company intends to sell or it is more likely than not that the Company will be required to sell the fixed maturity before a recovery in value. A corresponding charge is recorded in net realized capital losses equal to the difference between the fair value on the impairment date and the amortized cost basis of the fixed maturity before recognizing the impairment. For fixed maturities where a credit loss has been identified and no intent-to-sell impairment has been recorded, the Company will record an ACL for the portion of the unrealized loss related to the credit loss. Any remaining unrealized loss on a fixed maturity after recording an ACL is the non-credit amount and is recorded in OCI. The ACL is the excess of the amortized cost over the greater of the Company's best estimate of the present value of expected future cash flows or the security's fair value. Cash flows are discounted at the effective yield that is used to record interest income. The ACL cannot exceed the unrealized loss and, therefore, it may fluctuate with changes in the fair value of the fixed maturity if the fair value is greater than the Company's best estimate of the present value of expected future cash flows. The initial ACL and any subsequent changes are recorded in net realized capital gains and losses. The ACL is written off against the amortized cost in the period in which all or a portion of the related fixed maturity is determined to be uncollectible. Developing the Company’s best estimate of expected future cash flows is a quantitative and qualitative process that incorporates information received from third-party sources along with certain internal assumptions regarding the future performance. The Company's considerations include, but are not limited to (a) changes in the financial condition of the issuer and/or the underlying collateral, (b) whether the issuer is current on contractually obligated interest and principal payments, (c) credit ratings, (d) payment structure of the security and (e) the extent to which the fair value has been less than the amortized cost of the security. For non-structured securities, assumptions include, but are not limited to, economic and industry-specific trends and fundamentals, instrument-specific developments including changes in credit ratings, industry earnings multiples and the issuer’s ability to restructure, access capital markets, and execute asset sales. For structured securities, assumptions include, but are not limited to, various performance indicators such as historical and projected default and recovery rates, credit ratings, current and projected delinquency rates, loan-to-value ratios ("LTV"), average cumulative collateral loss rates that vary by vintage year, prepayment speeds, and property value declines. These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries which may include estimating the underlying collateral value. ACL on Fixed Maturities, AFS by Type for the Year Ended December 31, 2022 (Successor Company) (Before tax) Corporate Total Balance, beginning of period $ — $ — Credit losses on fixed maturities where an allowance was not previously recorded 1 1 Write-offs charged against the allowance (1) (1) Balance, end of period $ — $ — ACL on Fixed Maturities, AFS by Type for the Period of July 1, 2021 to December 31, 2021 (Successor Company) (Before tax) Corporate Total Balance, beginning of period $ — $ — Credit losses on fixed maturities where an allowance was not previously recorded — — Balance, end of period $ — $ — ACL on Fixed Maturities, AFS by Type for the Six Months Ended June 30, 2021 (Predecessor Company) (Before tax) Corporate Total Balance, beginning of period $ 1 $ 1 Credit losses on fixed maturities where an allowance was not previously recorded — — Balance, end of period $ 1 $ 1 Fixed Maturities, AFS Fixed Maturities, AFS by Type Successor Company December 31, 2022 December 31, 2021 Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value ABS $ 276 $ — $ — $ (22) $ 254 $ 260 $ — $ — $ (2) $ 258 CLOs 703 — — (27) 676 945 — — (1) 944 CMBS 1,724 — 1 (211) 1,514 2,345 — 4 (14) 2,335 Corporate 12,565 — 2 (2,326) 10,241 13,380 — 50 (73) 13,357 Foreign government/government agencies 377 — — (62) 315 365 — 1 (4) 362 Municipal bonds 1,309 — — (269) 1,040 1,452 — 10 (6) 1,456 RMBS 503 — — (86) 417 818 — — (7) 811 U.S. Treasuries 1,232 — — (306) 926 1,421 — 28 (1) 1,448 Total fixed maturities, AFS $ 18,689 $ — $ 3 $ (3,309) $ 15,383 $ 20,986 $ — $ 93 $ (108) $ 20,971 Fixed Maturities, AFS by Contractual Maturity Year Successor Company December 31, 2022 December 31, 2021 Contractual Maturity Amortized Fair Amortized Fair One year or less $ 445 $ 437 $ 341 $ 341 Over one year through five years 2,392 2,214 2,904 2,890 Over five years through ten years 4,438 3,732 5,248 5,241 Over ten years 8,209 6,140 8,125 8,151 Subtotal 15,484 12,523 16,618 16,623 Mortgage-backed, CLOs and ABS 3,205 2,860 4,368 4,348 Total fixed maturities, AFS $ 18,689 $ 15,383 $ 20,986 $ 20,971 Estimated maturities may differ from contractual maturities due to call or prepayment provisions. Due to the potential for variability in payment speeds (i.e. prepayments or extensions), mortgage-backed and asset-backed securities are not categorized by contractual maturity. Concentration of Credit Risk The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk. The Company evaluated its investment exposure to any credit concentration risk of a single issuer greater than 10% of the Company's stockholders' equity. As of December 31, 2022 (Successor Company), we are providing the top 25 investment concentrations, other than the U.S. government and certain U.S. government agencies and commercial mortgage loans, due to the size of our investment portfolio in comparison to our stockholders’ equity as of December 31, 2022. As of December 31, 2021 (Successor Company), the Company did not have any credit concentration risk of a single issuer greater than 10% of the Company's stockholders' equity. Top 25 Investment Holdings by Issuer Market Value Pacific Investment Management LLC $ 347 Madison Capital Funding 195 Harbourvest 131 Bank of America 121 Twin Brook Capital Partners 104 Oracle Corporation 95 Whitehorse Liquidity Partners 91 Mitsubishi UFJ Financial Group 90 Citigroup 88 Mizuho Financial Group 87 J.P. Morgan & Co. 85 International Business Machines Corporation 84 Boeing Company 82 Goldman Sachs Group, Inc. 75 Wells Fargo & Company 74 Sumitomo Mitsui Financial Group 73 UnitedHealth Group Inc. 70 Walt Disney Company 70 Strategic Partners VIII L.P. 69 T-Mobile US, Inc 69 Deutsche Telekom International Finance B.V. 66 Amgen Inc. 65 Gridiron Capital Fund III LP 65 ING Group 63 Strategic Partners Touchdown Holdings L.P. $ 62 Unrealized Losses on Fixed Maturities, AFS Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of December 31, 2022 Successor Company Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized ABS $ 96 $ (5) $ 162 $ (17) $ 258 $ (22) CLOs 644 (27) 11 — 655 (27) CMBS 819 (102) 682 (109) 1,501 (211) Corporate 6,659 (1,544) 3,412 (782) 10,071 (2,326) Foreign government/government agencies 185 (41) 128 (21) 313 (62) Municipal 859 (219) 180 (50) 1,039 (269) RMBS 123 (20) 293 (66) 416 (86) U.S. Treasuries 864 (293) 63 (13) 927 (306) Total fixed maturities, AFS in an unrealized loss position $ 10,249 $ (2,251) $ 4,931 $ (1,058) $ 15,180 $ (3,309) Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of December 31, 2021 Successor Company Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized ABS $ 252 $ (2) $ — $ — $ 252 $ (2) CLOs 751 (1) — — 751 (1) CMBS 961 (14) — — 961 (14) Corporate 5,788 (73) — — 5,788 (73) Foreign government/government agencies 173 (4) — — 173 (4) Municipal 337 (6) — — 337 (6) RMBS 537 (7) — — 537 (7) U.S. Treasuries 217 (1) — — 217 (1) Total fixed maturities, AFS in an unrealized loss position $ 9,016 $ (108) $ — $ — $ 9,016 $ (108) As of December 31, 2022 (Successor Company), fixed maturities, AFS in an unrealized loss position consisted of 4,426 instruments, and were primarily depressed due to higher interest rates and/or wider credit spreads since the purchase and/or application of pushdown accounting dates. As of December 31, 2022 (Successor Company), 57% of these fixed maturities were depressed less than 20% of cost or amortized cost. The increase in unrealized losses during 2022, was primarily attributable to higher interest rates and wider credit spreads. Most of the fixed maturities depressed for twelve months or more relate to the corporate sector which were primarily depressed because current rates are higher and/or market spreads are wider than at the respective purchase and/or application of pushdown accounting dates . The Company neither has an intention to sell nor does it expect to be required to sell the fixed maturities outlined in the preceding discussion. The decision to record credit losses on fixed maturities, AFS in the form of an ACL requires us to make qualitative and quantitative estimates of expected future cash flows. Actual cash flows could deviate significantly from our expectations resulting in realized losses in future periods. Mortgage Loans ACL on Mortgage Loans The Company reviews mortgage loans on a quarterly basis to estimate the ACL, with changes in the ACL recorded in net realized capital gains (losses). Apart from an ACL recorded on individual mortgage loans where the borrower is experiencing financial difficulties, the Company records an ACL on the pool of mortgage loans based on lifetime expected credit losses. The Company utilizes a third-party forecasting model to estimate lifetime expected credit losses at a loan level under multiple economic scenarios. The scenarios use macroeconomic data provided by an internationally recognized economics firm that generates forecasts of varying economic factors such as GDP growth, unemployment and interest rates. The economic scenarios are projected over 10 years. The first two years to four years of the 10-year period assume a specific modeled economic scenario (including moderate upside, moderate recession and severe recession scenarios) and then revert to historical long-term assumptions over the remaining period. Using these economic scenarios, the forecasting model projects property-specific operating income and capitalization rates used to estimate the value of a future operating income stream. The operating income and the property valuations derived from capitalization rates are compared to loan payment and principal amounts to create debt-service coverage ratios ("DSCRs") and LTVs over the forecast period. The Company's process also considers qualitative factors. The model overlays historical data about mortgage loan performance based on DSCRs and LTVs and projects the probability of default, amount of loss given a default and resulting expected loss through maturity for each loan under each economic scenario. Economic scenarios are probability-weighted based on a statistical analysis of the forecasted economic factors and qualitative analysis. The Company records the change in the ACL on mortgage loans based on the weighted-average expected credit losses across the selected economic scenarios. When a borrower is experiencing financial difficulty, including when foreclosure is probable, the Company measures an ACL on individual mortgage loans. The ACL is established for any shortfall between the amortized cost of the loan and the fair value of the collateral less costs to sell. Estimates of collectibility from an individual borrower require the use of significant management judgment and include the probability and timing of borrower default and loss severity estimates. In addition, cash flow projections may change based upon new information about the borrower's ability to pay and/or the value of underlying collateral such as changes in projected property value estimates. As of December 31, 2022 (Successor Company) and December 31, 2021 (Successor Company), the Company did not have any mortgage loans for which an ACL was established on an individual basis. There were no mortgage loans held-for-sale as of December 31, 2022 (Successor Company) or 2021 (Successor Company). In addition, as of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company had no mortgage loans that have had extensions or restructurings other than what is allowable under the original terms of the contract. ACL on Mortgage Loans Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Beginning balance $ 12 $ — $ 17 $ — Cumulative effect of accounting changes [1] 9 Cumulative effect of pushdown accounting 12 Adjusted beginning balance ACL 12 12 17 9 Current period provision (release) 3 — (6) 8 Ending balance $ 15 $ 12 $ 11 $ 17 [1] Represents the establishment of an ACL due to the adoption of expected credit loss accounting guidance. Refer to Note 1 - Basis of Presentation and Significant Accounting Policies for additional information. The increase in the allowance for the year ended December 31, 2022 (Successor Company) was primarily attributable to the deteriorating economic conditions and the potential impact on real estate property valuations and, to a lesser extent, net additions of new loans. The increase in the allowance for the period of July 1, 2021 to December 31, 2021 (Successor Company) was the result of pushdown accounting. The decrease in the allowance for the six months ended June 30, 2021 (Predecessor Company), is the result of improved economic scenarios, including improved GDP growth and unemployment, and higher property valuations as compared to the prior periods. During 2020 (Predecessor Company), the Company increased the estimate of the ACL in response to significant economic stress experienced as a result of the COVID-19 pandemic. The weighted-average LTV ratio of the Company’s mortgage loan portfolio was 62% as of December 31, 2022 (Successor Company), while the weighted-average LTV ratio at origination of these loans was 53%. LTV ratios compare the loan amount to the value of the underlying property collateralizing the loan with property values based on appraisals updated no less than annually. Factors considered in estimating property values include, among other things, actual and expected property cash flows, geographic market data and the ratio of the property's net operating income to its value. DSCR compares a property’s net operating income to the borrower’s principal and interest payments and are updated no less than annually through reviews of underlying properties. Mortgage Loans LTV & DSCR by Origination Year as of December 31, 2022 (Successor Company) 2022 2021 2020 2019 2018 2017 & Prior Total Loan-to-Value Amortized Cost Avg. DSCR [2] Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost [1] Avg. DSCR [2] Greater than 80% $ 54 —x $ — —x $ — —x $ — —x $ — —x $ 41 2.09x $ 95 2.09x 65% - 80% 10 2.02x 21 2.51x 14 2.79x 27 2.08x 116 1.28x 60 1.77x 248 1.71x Less than 65% 461 2.47x 379 2.76x 166 2.65x 220 2.92x 181 2.14x 785 2.74x 2,192 2.67x Total mortgage loans $ 525 2.45x $ 400 2.74x $ 180 2.66x $ 247 2.83x $ 297 1.80x $ 886 2.64x $ 2,535 2.55x [1] As of December 31, 2022 (Successor Company), the amortized cost of mortgage loans excludes ACL of $15. [2] Ratios exclude certain single family residential mortgage loans. Mortgage Loans LTV & DSCR by Origination Year as of December 31, 2021 (Successor Company) 2021 2020 2019 2018 2017 2016 & Prior Total Loan-to-Value Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost [1] Avg. DSCR 65% - 80% $ 7 2.37x $ 18 2.62x $ 25 1.55x $ 43 1.00x $ 41 1.94x $ 37 1.23x $ 171 1.60x Less than 65% 378 2.68x 160 2.43x 234 2.89x 270 2.00x 235 2.27x 695 2.54x 1,972 2.50x Total mortgage loans $ 385 2.68x $ 178 2.45x $ 259 2.76x $ 313 1.86x $ 276 2.22x $ 732 2.47x $ 2,143 2.42x [1] As of December 31, 2021 (Successor Company), the amortized cost of mortgage loans excludes ACL of $12. Mortgage Loans by Region Successor Company December 31, 2022 December 31, 2021 Amortized Percent of Total Amortized Percent of Total East North Central $ 74 2.9 % $ 78 3.6 % East South Central 32 1.3 % 20 0.9 % Middle Atlantic 194 7.7 % 152 7.1 % Mountain 185 7.3 % 142 6.6 % New England 82 3.2 % 87 4.1 % Pacific 535 21.1 % 559 26.1 % South Atlantic 694 27.4 % 627 29.3 % West South Central 180 7.1 % 184 8.6 % Other [2] 559 22.0 % 294 13.7 % Total mortgage loans $ 2,535 100 % $ 2,143 100 % [1] As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the amortized cost of mortgage loans excludes ACL of $15 and $12, respectively. [2] Primarily represents loans collateralized by multiple properties in various regions. Mortgage Loans by Property Type Successor Company December 31, 2022 December 31, 2021 Amortized Percent of Total Amortized Percent of Total Commercial Industrial $ 787 31.0 % $ 711 33.2 % Multifamily 669 26.4 % 590 27.5 % Office 383 15.1 % 423 19.7 % Retail 443 17.5 % 403 18.8 % Single Family 253 10.0 % 16 0.8 % Total mortgage loans $ 2,535 100 % $ 2,143 100 % [1] As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the amortized cost of mortgage loans excludes ACL of $15 and $12, respectively. Past-Due Mortgage Loans Mortgage loans are considered past due if a payment of principal or interest is not received according to the contractual terms of the loan agreement, which typically includes a grace period. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company held no mortgage loans considered past due. Purchased Financial Assets with Credit Deterioration Purchased financial assets with credit deterioration ("PCD") are purchased financial assets with a “more-than-insignificant” amount of credit deterioration since origination. PCD assets are assessed only at initial acquisition date and for any investments identified, the Company records an allowance at acquisition with a corresponding increase to the amortized cost basis. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company held no PCD fixed maturities, AFS or mortgage loans. Variable Interest Entities The Company is engaged with various special purpose entities and other entities that are deemed to be variable interest entities ("VIEs") primarily as an investor through normal investment activities. A VIE is an entity that either has investors that lack certain essential characteristics of a controlling financial interest, such as simple majority kick-out rights, or lacks sufficient funds to finance its own activities without financial support provided by other entities. The Company performs ongoing qualitative assessments of its VIEs to determine whether the Company has a controlling financial interest in the VIE and therefore is the primary beneficiary. The Company is deemed to have a controlling financial interest when it has both the ability to direct the activities that most significantly impact the economic performance of the VIE and the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. Based on the Company’s assessment, if it determines it is the primary beneficiary, the Company consolidates the VIE on the Company’s Consolidated Financial Statements. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company did not hold any VIEs for which it was the primary beneficiary. Non-Consolidated VIEs The Company, through normal investment activities, makes passive investments in limited partnerships and other alternative investments. For these non-consolidated VIEs, the Company has determined it is not the primary beneficiary as it has no ability to direct activities that could significantly affect the economic performance of the investments. The Company’s maximum exposure to loss as of December 31, 2022 (Successor Company) and 2021 (Successor Company) is limited to the total carrying value of $1.3 billion and $1.1 billion, respectively, which are included in limited partnerships and other alternative investments on the Company's Consolidated Balance Sheets. As of December 31, 2022(Successor Company) and 2021 (Successor Company), the Company had outstanding commitments totaling $410 and $419, respectively, whereby the Company is committed to fund these investments and may be called by the partnership during the commitment period to fund the purchase of new investments and partnership expenses. These investments are generally of a passive nature in that the Company does not take an active role in management. In addition, the Company makes passive investments in structured securities issued by VIEs for which the Company is not the manager. These investments are included in ABS, CLOs, CMBS, and RMBS and are reported in fixed maturities, AFS on the Company’s Consolidated Balance Sheets. The Company has not provided financial or other support with respect to these investments other than its original investment. For these investments, the Company determined it is not the primary beneficiary due to the relative size of the Company’s investment in comparison to the principal amount of the structured securities issued by the VIEs, the Company’s inability to direct the activities that most significantly impact the economic performance of the VIEs, and, where applicable, the level of credit subordination which reduces the Company’s obligation to absorb losses or right to receive benefits. The Company’s maximum exposure to loss on these investments is limited to the amount of the Company’s investment. Repurchase Agreements and Other Collateral Transactions The Company enters into securities financing transactions as a way to earn additional income or manage liquidity, primarily through repurchase agreements. Repurchase Agreements From time to time, the Company enters into repurchase agreements to manage liquidity or to earn incremental income. A repurchase agreement is a transaction in which one party (transferor) agrees to sell securities to another party (transferee) in return for cash (or securities), with a simultaneous agreement to repurchase the same securities at a specified price at a later date. The maturity of these transactions is generally of ninety days or less. Repurchase agreements include master netting provisions that provide both parties the right to offset claims and apply securities held by them with respect to their obligations in the event of a default. Although the Company has the contractual right to offset claims, the Company's current positions do not meet the specific conditions for net presentation. Under repurchase agreements, the Company transfers collateral of U.S. government and government agency securities and receives cash. For repurchase agreements, the Company obtains cash in an amount equal to at least 95% of the fair value of the securities transferred. The agreements require additional collateral to be transferred under specified conditions and provide the counterparty the right to sell or re-pledge the securities transferred. The cash received from the repurchase program is typically invested in short-term investments or fixed maturities and is reported as an asset on the Company's Consolidated Balance Sheets. The Company accounts for the repurchase agreements as collateralized borrowings. The securities transferred under repurchase agreements are included in fixed maturities, AFS with the obligation to repurchase those securities recorded in other liabilities on the Company's Consolidated Balance Sheets. From time to time, the Company enters into reverse repurchase agreements where the Company purchases securities and simultaneously agrees to resell the same or substantially the same securities. The maturity of these transactions is generally within one year. The agreements require additional collateral to be transferred to the Company under specified conditions and the Company has the right to sell or re-pledge the securities received. The Company accounts for reverse repurchase agreements as collateralized financing. The receivable for reverse repurchase agreements is included within short-term investments on the Company's Consolidated Balance Sheets. Repurchase Agreements Successor Company December 31, 2022 December 31, 2021 Fair Value Fair Value Repurchase agreements: Gross amount of recognized liabilities for repurchase agreements $ 564 $ 663 Gross amount of collateral pledged related to repurchase agreements [1] $ 577 $ 679 Gross amount of recognized receivables for reverse repurchase agreements [2] $ 7 $ 44 [1] Collateral pledged is included within fixed maturities, AFS and short-term investments on the Company's Consolidated Balance Sheets. [2] Collateral received is included within short-term investments on the Company's Consolidated Balance Sheets. Other Collateral Transactions The Company is required by law to deposit securities with government agencies in certain states in which it conducts business. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the fair value of securities on deposit was $20 and $26, respectively. For disclosure of collateral in support of derivative transactions, refer to the Derivative Collateral Arrangements section of Note 4 - Derivatives of Notes to Consolidated Financial Statements. Equity Method Investments The majority of the Company's investments in limited partnerships and other alternative investments, including hedge funds, mortgage and real estate funds, and private equity and other funds (collectively, “limited partnerships”), are accounted for under the equity method of accounting. The Company recognized total equity method income of $168 for the year ended December 31, 2022 (Successor Company), $259 for the period of December 31, 2021 (Successor Company), $216 for the six months ended June 30, 2021 (Predecessor Company) and $130 for the year ended December 31, 2020 (Predecessor Company). Equity method income is reported in net investment income. The Company’s maximum exposure to loss as of December 31, 2022 (Successor Company) is limited to the total carrying value of $1.3 billion. In addition, the Company has outstanding commitments totaling approximately $410, to fund limited partnership and other alternative investments as of December 31, 2022 (Successor Company). The Company’s investments in limited partnerships are generally of a passive nature in that the Company does not take an active role in the management of the limited partnerships. In 2022, aggregate investment income (losses) from limi |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives Derivative Instruments The Company utilizes a variety of OTC, OTC-cleared and exchange traded derivative instruments as a part of its overall risk management strategy as well as to enter into replication transactions. Derivative instruments are used to manage risk associated with interest rate, equity market, credit spread, issuer default, price, and currency exchange rate risk or volatility. Replication transactions are used as an economical means to synthetically replicate the characteristics and performance of assets that are permissible investments under the Company’s investment policies. The Company also may enter into and has previously issued financial instruments and products that either are accounted for as freestanding derivatives, such as certain reinsurance contracts, or as embedded derivative instruments, such as certain GMWB riders included with certain variable annuity products. Strategies that Qualify for Hedge Accounting Some of the Company's derivatives satisfy hedge accounting requirements as outlined in Note 1 - Basis of Presentation and Significant Accounting Policies of these financial statements. Typically, these hedging instruments include interest rate swaps and, to a lesser extent, foreign currency swaps where the terms or expected cash flows of the hedged item closely match the terms of the swap. The interest rate swaps are typically used to manage interest rate duration of certain fixed maturity securities or liability contracts. As a result of pushdown accounting, derivative instruments that previously qualified for hedge accounting were de-designated and recorded at fair value through adjustments to additional paid-in capital at the acquisition date. The hedge strategies by hedge accounting designation include: Cash Flow Hedges Interest rate swaps are predominantly used to manage portfolio duration and better match cash receipts from assets with cash disbursements required to fund liabilities. These derivatives primarily convert interest receipts on floating-rate fixed maturity securities to fixed rates. Foreign currency swaps are used to convert foreign currency-denominated cash flows related to certain investment receipts and liability payments to U.S. dollars in order to reduce cash flow fluctuations due to changes in currency rates. Non-Qualifying Strategies Derivative relationships that do not qualify for hedge accounting (“non-qualifying strategies”) primarily include the hedge program for the Company's variable annuity products as well as the hedging and replication strategies that utilize credit default swaps. In addition, hedges of interest rate, foreign currency and equity risk of certain fixed maturities, equities and liabilities do not qualify for hedge accounting. The non-qualifying strategies include: Interest Rate Swaps, Swaptions and Futures The Company uses interest rate swaps, swaptions and futures to manage interest rate duration between assets and liabilities in certain investment portfolios. In addition, the Company enters into interest rate swaps to terminate existing swaps, thereby offsetting the changes in value of the original swap. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the notional amount of interest rate swaps in offsetting relationships was $276 and $506, respectively. Foreign Currency Swaps and Forwards The Company enters into foreign currency swaps to convert the foreign currency exposures of certain foreign currency-denominated fixed maturity investments to U.S. dollars. The Company also enters into foreign currency forwards to hedge non-U.S. dollar denominated cash. Credit Contracts Credit default swaps are used to purchase credit protection on an individual entity or referenced index to economically hedge against default risk and credit-related changes in the value of fixed maturity securities. Credit default swaps are also used to assume credit risk related to an individual entity or referenced index as a part of replication transactions. These contracts require the Company to pay or receive a periodic fee in exchange for compensation from the counterparty or the Company should the referenced security issuers experience a credit event, as defined in the contract. In addition, the Company enters into credit default swaps to terminate existing credit default swaps, thereby offsetting the changes in value of the original swap going forward. Equity Index Swaps and Options The Company enters into equity index options to hedge the impact of a decline in the equity markets on the investment portfolio. Macro Hedge Program The Company utilizes equity swaps, options and futures as well as interest rate swaps to provide protection against the statutory tail scenario risk to the Company's statutory surplus arising from higher GMDB claims, as well as lower variable annuity fee revenue. GMWB Derivatives, net The Company formerly offered certain variable annuity products with GMWB riders. The GMWB product is a bifurcated embedded derivative (“GMWB product derivatives”) that has a notional value equal to the GRB. The Company uses reinsurance contracts to transfer a portion of its risk of loss due to GMWB. The reinsurance contracts covering GMWB (“GMWB reinsurance contracts”) are accounted for as freestanding derivatives with a notional amount equal to the GRB reinsured. FIA Embedded Derivative The Company has assumed through reinsurance, certain FIA products with index-based crediting that constitutes an embedded derivative. The cedant hedges this risk and provides the benefits of this hedging as part of the reinsurance settlements. Ceded Modified Coinsurance Reinsurance Contracts As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company had approximately $645 and $775, respectively, of invested assets supporting other policyholder funds and benefits payable reinsured under a modified coinsurance arrangement in connection with the sale of the Individual Life business, which was structured as a reinsurance transaction. The assets are primarily held in trust accounts established by the Company. The Company pays or receives cash quarterly to settle the operating results of the reinsured business, including the investment results. As a result of this modified coinsurance arrangement, the Company has an embedded derivative that transfers to the reinsurer certain unrealized changes in fair value of investments subject to interest rate and credit risk. The notional amount of the embedded derivative reinsurance contracts are the invested assets which are carried at fair value and support the reinsured reserves. A funds withheld liability is recorded for funds contractually withheld by the Company under funds withheld modified coinsurance arrangements in which the Company is the cedant. Derivative Balance Sheet Classification For reporting purposes, the Company has elected to offset within assets or liabilities based upon the net of the fair value amounts, income accruals, and related cash collateral receivables and payables of OTC derivative instruments executed in a legal entity and with the same counterparty under a master netting agreement, which provides the Company with the legal right of offset. The following fair value amounts do not include income accruals or related cash collateral receivables and payables, which are netted with derivative fair value amounts to determine balance sheet presentation. Derivatives in the Company’s separate accounts, where the associated gains and losses accrue directly to policyholders are not included in the table below. The Company’s derivative instruments are held for risk management purposes, unless otherwise noted in the following table. The notional amount of derivative contracts represents the basis upon which pay or receive amounts are calculated and is presented in the table to quantify the volume of the Company’s derivative activity. Notional amounts are not necessarily reflective of credit risk. The following tables exclude investments that contain an embedded credit derivative for which the Company has elected the FVO. Net Asset Liability Derivatives Notional Fair Fair Fair Successor Company Successor Company Successor Company Successor Company Hedge Designation/Derivative Type Dec 31, 2022 Dec 31, 2021 Dec 31, 2022 Dec 31, 2021 Dec 31, 2022 Dec 31, 2021 Dec 31, 2022 Dec 31, 2021 Cash flow hedges Interest rate swaps $ 250 $ 100 $ — $ — $ — $ — $ — $ — Total cash flow hedges 250 100 — — — — — — Non-qualifying strategies Interest rate contracts Interest rate swaps and futures 1,363 3,074 (1) (7) 3 19 (4) (26) Foreign exchange contracts Foreign currency swaps and forwards 161 161 15 9 16 10 (1) (1) Credit contracts Credit derivatives that assume credit risk 500 100 4 2 4 2 — — Variable annuity hedge program GMWB product derivatives [1] 6,308 7,086 131 80 131 100 — (20) GMWB reinsurance contracts 1,397 1,555 (131) (8) — — (131) (8) GMWB hedging instruments — — — — — — — — Macro hedge program 22,823 22,991 211 (213) 506 145 (295) (358) Fixed indexed annuities FIA product derivative [1] [2] — — (385) (655) — — (385) (655) FIA reinsurance contracts [2] — — 288 — 288 — — — Other Modified coinsurance reinsurance contracts [2] — — 1,647 15 1,647 15 — — Total non-qualifying strategies 32,552 34,967 1,779 (777) 2,595 291 (816) (1,068) Total cash flow hedges and non-qualifying strategies $ 32,802 $ 35,067 $ 1,779 $ (777) $ 2,595 $ 291 $ (816) $ (1,068) Balance Sheet Location Fixed maturities, AFS $ 56 $ 56 $ — $ — $ — $ — $ — $ — Other investments 11,998 8,163 195 43 237 91 (42) (48) Other liabilities 13,043 18,206 34 (252) 292 85 (258) (337) Reinsurance recoverables 1,397 1,556 286 7 417 15 (131) (8) Funds withheld liability — — 1,518 — 1,518 — — — Other policyholder funds and benefits payable 6,308 7,086 (254) (575) 131 100 (385) (675) Total derivatives $ 32,802 $ 35,067 $ 1,779 $ (777) $ 2,595 $ 291 $ (816) $ (1,068) [1] These derivatives are embedded within liabilities and are not held for risk management purposes. [2] For certain assumed and ceded reinsurance agreements the notional value is not indicative of the volume of activity. Refer to Note 5 - Reinsurance for additional information regarding the activity which generated the value of the embedded derivative. Offsetting of Derivative Assets/Liabilities The following tables present the gross fair value amounts, the amounts offset, and net position of derivative instruments eligible for offset on the Company's Consolidated Balance Sheets. Amounts offset include fair value amounts, income accruals and related cash collateral receivables and payables associated with derivative instruments that are traded under a common master netting agreement, as described in the preceding discussion. Also included in the tables are financial collateral receivables and payables, which are contractually permitted to be offset upon an event of default, although are disallowed for offsetting under U.S. GAAP. Offsetting Derivative Assets and Liabilities (i) (ii) (iii) = (i) - (ii) (iv) (v) = (iii) - (iv) Net Amounts Presented on the Statement of Financial Position Collateral Disallowed for Offset on the Statement of Financial Position Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset on the Statement of Financial Position Derivative Assets [1] (Liabilities) [2] Accrued Interest and Cash Collateral (Received) [3] Pledged [2] Financial Collateral (Received) Pledged [4] Net Amount As of December 31, 2022 (Successor Company) Other investments $ 529 $ 446 $ 195 $ (112) $ 68 $ 15 Other liabilities (300) (195) 34 (139) (103) (2) As of December 31, 2021 (Successor Company) Other investments $ 176 $ 162 $ 43 $ (29) $ 5 $ 9 Other liabilities (385) (134) (252) 1 (251) — [1] Included in other invested assets on the Company's Consolidated Balance Sheets. [2] Included in other liabilities on the Company's Consolidated Balance Sheets and is limited to the net derivative payable associated with each counterparty. [3] Included in other investments on the Company's Consolidated Balance Sheets and is limited to the net derivative receivable associated with each counterparty. [4] Excludes collateral associated with exchange-traded derivative instruments. Cash Flow Hedges For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the derivative is reported as a component of OCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness. Derivatives in Cash Flow Hedging Relationships Pre-Tax Gain (Loss) Recognized in OCI Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Interest rate swaps $ (35) $ — $ — $ — Foreign currency swaps — — — (2) Total $ (35) $ — $ — $ (2) Derivatives in Cash Flow Hedging Relationships (Successor Company) Gain (Loss) Reclassified from AOCI into Income For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 Net Realized Capital Net Net Realized Capital Net Interest rate swaps $ — $ (1) $ — $ — Foreign currency swaps — — — — Total $ — $ (1) $ — $ — Total amounts presented in the Consolidated Statements of Operations $ 317 $ 778 $ (20) $ 498 Derivatives in Cash Flow Hedging Relationships (Predecessor Company) Gain or (Loss) Reclassified from AOCI into Income For the Six Months Ended June 30, 2021 For the Years Ended December 31, 2020 Net Realized Capital Net Investment Income Net Realized Capital Net Investment Income Interest rate swaps $ — $ — $ — $ — Foreign currency swaps (1) — — — Total (1) — — — Total amounts presented in the Consolidated Statements of Operations $ (242) $ 534 $ (74) $ 816 As of December 31, 2022 (Successor Company), the before tax deferred net losses on derivative instruments recorded in AOCI that are expected to be reclassified to earnings during the next twelve months were $8. This expectation is based on the anticipated interest payments on hedged investments in fixed maturity securities that will occur over the next twelve months, at which time the Company will recognize the deferred net gains (losses) as an adjustment to net investment income over the term of the investment cash flows. For all periods presented, the Company had no net reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges due to forecasted transactions that were no longer probable of occurring. Non-qualifying Strategies For non-qualifying strategies, including embedded derivatives that are required to be bifurcated from their host contracts and accounted for as derivatives, the gain or loss on the derivative is recognized currently in earnings within net realized capital gains (losses). Non-qualifying Strategies Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Variable annuity hedge program GMWB product derivatives $ 88 $ 29 $ 82 $ 67 GMWB reinsurance contracts (88) 4 (24) (27) GMWB hedging instruments 42 Variable annuity macro hedge program (1) (100) (301) (414) Total variable annuity hedge program (1) (67) (243) (332) Fixed Index Annuity FIA product derivatives 270 — — — Foreign exchange contracts Foreign currency swaps and forwards 7 5 (2) (4) Other non-qualifying derivatives Interest rate contracts Interest rate swaps, swaptions, and futures (306) 21 (76) 180 Credit contracts Credit derivatives that purchase credit protection — — — 19 Credit derivatives that assume credit risk 3 1 — — Other Modified coinsurance reinsurance contracts 1,136 15 22 (50) Total other non-qualifying derivatives 833 37 (54) 149 Total [1] $ 1,109 $ (25) $ (299) $ (187) [1] Excludes investments that contain an embedded credit derivative for which the Company has elected the FVO. Credit Risk Assumed through Credit Derivatives The Company enters into credit default swaps that assume credit risk of a single entity or referenced index in order to synthetically replicate investment transactions that are permissible under the Company's investment policies. The Company will receive periodic payments based on an agreed upon rate and notional amount and will only make a payment if there is a credit event. A credit event payment will typically be equal to the notional value of the swap contract less the value of the referenced security issuer’s debt obligation after the occurrence of the credit event. A credit event is generally defined as a default on contractually obligated interest or principal payments or bankruptcy of the referenced entity. The credit default swaps in which the Company assumes credit risk primarily reference investment grade single corporate issuers and baskets, which include standard diversified portfolios of corporate and CMBS issuers. The diversified portfolios of corporate issuers are established within sector concentration limits and may be divided into tranches that possess different credit ratings. As of December 31, 2022 (Successor Company) Underlying Referenced Credit Obligation(s) [1] Credit Derivative Type by Derivative Risk Exposure Notional Fair Weighted Type Average Offsetting Offsetting Basket credit default swaps [3] Investment grade risk exposure $ 500 $ 4 5 years Corporate Credit BBB+ $ — $ — Total $ 500 $ 4 $ — $ — As of December 31, 2021 (Successor Company) Underlying Referenced Credit Obligation(s) [1] Credit Derivative Type by Derivative Risk Exposure Notional Fair Weighted Type Average Offsetting Offsetting Basket credit default swaps [3] Investment grade risk exposure $ 100 $ 2 5 years Corporate Credit BBB+ $ — $ — Total $ 100 $ 2 $ — $ — [1] The average credit ratings are based on availability and are generally the midpoint of the available ratings among Moody’s, S&P, and Fitch. If no rating is available from a rating agency, then an internally developed rating is used. [2] Notional amount is equal to the maximum potential future loss amount. These derivatives are governed by agreements and applicable law which include collateral posting requirements. There is no additional specific collateral related to these contracts or recourse provisions included in the contracts to offset losses. [3] Comprised of swaps of standard market indices of diversified portfolios of corporate and CMBS issuers referenced through credit default swaps. These swaps are subsequently valued based upon the observable standard market index. Derivative Collateral Arrangements The Company enters into various collateral arrangements in connection with its derivative instruments, which require both the pledging and accepting of collateral. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company pledged cash collateral with a fair value of $5 and $2, respectively, associated with derivative instruments. The collateral receivable has been recorded in other assets or other liabilities on the Company's Consolidated Balance Sheets, as determined by the Company's election to offset on the balance sheet. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company also pledged securities collateral associated with derivative instruments with a fair value of $106 and $270, respectively, which have been included in fixed maturities, AFS on the Consolidated Balance Sheets. The counterparties have the right to sell or re-pledge these securities. In addition, as of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company has pledged initial margin of cash related to OTC-cleared and exchange traded derivatives with a fair value of $15 and $4, respectively, which is recorded in other investments or other assets on the Company's Consolidated Balance Sheets. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company has pledged initial margin of securities related to OTC-cleared and exchange traded derivatives with a fair value of $187 and $172, respectively, which are included within fixed maturities, AFS on the Company's Consolidated Balance Sheets. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company accepted cash collateral associated with derivative instruments of $262 and $30, respectively, which was invested and recorded on the Consolidated Balance Sheets in fixed maturities, AFS and short-term investments with corresponding amounts recorded in other investments or other liabilities as determined by the Company's election to offset on the balance sheet. The Company also accepted securities collateral as of December 31, 2022 (Successor Company) and 2021 (Successor Company) with a fair value of $79 and $5, respectively, which the Company has the right to sell or repledge. As of December 31, 2022 (Successor Company), the Company had not repledged securities and did not sell any securities. The non-cash collateral accepted was held in separate custodial accounts and was not included on the Company's Consolidated Balance Sheets. |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2022 | |
Insurance [Abstract] | |
Reinsurance | Reinsurance The Company cedes to affiliated and unaffiliated insurers to enable the Company to manage capital and risk exposure. The Company also assumes from unaffiliated insurers to provide our counterparties with risk management solutions. The Company's historical reinsurance cessions provided a level of risk mitigation desired by prior ownership. The Company's current reinsurance assumptions and internal retrocessions provide strategic business growth opportunities. Such arrangements do not relieve the Company of its primary liability to policyholders. Failure of reinsurers to honor their obligations could result in losses to the Company. The Company regularly monitors the financial condition and ratings of its reinsurers and structures agreements to provide collateral funds where necessary. Assumed Reinsurance Guardian As disclosed in Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements, on November 1, 2022 (Successor Company), the Company entered into a reinsurance agreement with GIAC to assume certain blocks of variable annuities. Although the separate account assets and liabilities are reported net on the Company's Consolidated Balance Sheets, the Company earns income on the assumed separate account assets. The following table summarizes the impacts of the transaction: Assets Investments $ 405 Cash 121 Other assets 3 Total assets 529 Liabilities Reserve for future policy benefits 3 Other policyholder funds and benefits payable 436 Other liabilities [1] 90 Total liabilities $ 529 [1] Other liabilities represents a deferred gain of $90. Allianz As disclosed in Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements, on December 30, 2021 (Successor Company), the Company entered into a reinsurance agreement with Allianz, whereby the Company assumed certain blocks of FIA on a coinsurance basis. The following table summarizes the impacts of the transaction: Assets Investments $ 8,357 Cash (693) Other assets 75 Reinsurance recoverables 244 Total assets 7,983 Liabilities Reserve for future policy benefits 616 Other policyholder funds and benefits payable 7,340 Other liabilities [1] 27 Total liabilities $ 7,983 [1] Other liabilities includes a deferred gain of $25. For the period of July 1, 2021 through December 31, 2021 (Successor Company), there was not a material impact on the Consolidated Statements of Operations from the Company's reinsurance arrangement with Allianz. Ceded Reinsurance Reinsurance recoverables include balances due from reinsurance companies and are presented net of ACL. The ACL represents an estimate of expected credit losses over the lifetime of the contracts that reflect management’s best estimate of reinsurance cessions that may be uncollectible in the future due to reinsurers’ inability to pay. Reinsurance recoverables include an estimate of the amount of policyholder benefits that may be ceded under the terms of the reinsurance agreements. Amounts recoverable from reinsurers are estimated in a manner consistent with assumptions used for the underlying policy benefits. Accordingly, the Company’s estimate of reinsurance recoverables is subject to similar risks and uncertainties as the estimate of the gross reserve for future policy benefits. Reinsurance Recoverables, net Successor Company As of December 31, 2022 2021 Reserve for future policy benefits and other policyholder funds and benefits payable Sold businesses (MassMutual and Prudential) $ 20,174 $ 19,850 Commonwealth Annuity and Life Insurance Company ("Commonwealth") 8,001 8,718 TR Re 11,537 6,130 Other reinsurers 1,029 1,187 Gross reinsurance recoverables 40,741 35,885 Less: ACL 27 37 Reinsurance recoverables, net $ 40,714 $ 35,848 As of December 31, 2022 (Successor Company), the Company had reinsurance recoverables from Commonwealth, Massachusetts Mutual Life Insurance Company ("MassMutual"), Prudential Financial, Inc. ("Prudential") and TR Re of approximately $8.0 billion, $6.7 billion, $13.5 billion and $11.5 billion, respectively. As of December 31, 2021 (Successor Company), the Company had reinsurance recoverables from Commonwealth, MassMutual, Prudential and TR Re of $8.7 billion, $6.8 billion, $13.1 billion and $6.1 billion, respectively. The Company's obligations to its direct policyholders that have been reinsured to Commonwealth, MassMutual and Prudential are primarily secured by invested assets held in trust. The Company's obligations to its direct policyholders reinsured to TR Re are secured by invested assets held by the Company in segregated portfolios. Affiliated As disclosed in Note 1 - Basis of Presentation and Significant Accounting Policies, on December 31, 2022 (Successor Company) and December 31, 2021 (Successor Company), the Company entered into several affiliated reinsurance agreements with TR Re, primarily on a modified coinsurance basis. The following table summarizes the impacts of these transactions: December 31, 2022 (Successor Company) Assets Reinsurance recoverables $ 5,192 VOBA and DAC (11) Total assets 5,181 Liabilities Funds withheld liability 5,045 Other liabilities [1] 136 Total liabilities $ 5,181 [1] Other liabilities includes a deferred gain of $137. For the year ended December 31, 2022 (Successor Company), there was no impact in the Consolidated Statements of Operations from the Company's affiliated reinsurance arrangement entered into in 2022. December 31, 2021 (Successor Company) Assets Cash $ (184) Reinsurance recoverables 6,130 Total assets 5,946 Liabilities Funds withheld liability 5,128 Other liabilities [1] 818 Total liabilities $ 5,946 [1] Other liabilities includes a deferred gain of $805. For the year ended December 31, 2022 (Successor Company), the impacts in the Consolidated Statements of Operations from the Company's affiliated reinsurance arrangement entered into in 2021, was as follows: Affiliated Reinsurance Impacts Successor Company As of December 31, 2022 Revenues Policy charges and fee income $ (279) Premiums (27) Net investment income (136) Net realized capital gains 990 Amortization of deferred gains 27 Total revenues 575 Benefits, losses and expenses Benefits and losses (184) Insurance operating costs and other expenses (119) Total benefits, losses and expenses (303) Income before income taxes 878 Income tax expense 184 Net income $ 694 For the period of July 1, 2021 through December 31, 2021 (Successor Company), there was not a material impact on the Consolidated Statements of Operations from the Company's affiliated reinsurance arrangement entered into in 2021. Allowance for Credit Losses For the year ended December 31, 2022, the ACL decreased by $10 to $27. The Company closely monitors the financial condition, ratings and current market information of all its counterparty reinsurers and records an ACL considering the credit quality of the reinsurer, the invested assets in trust, and the period over which the recoverable balances are expected to be collected. Counterparty risk is assessed on a pooled basis in cases of shared risk characteristics, and separately for individual reinsurers when it is more relevant. The Company evaluates historical events, current conditions, and reasonable and supportable forecasts in developing its ACL estimate. Where its contracts permit, the Company secures future claim obligations with various forms of collateral, including irrevocable letters of credit, secured trusts and funds held accounts. The ACL is estimated using a probability of default and loss given default model applied to the amount of reinsurance recoverables, net of collateral, exposed to loss. The probability of default factor is assigned based on each reinsurer's credit rating. The Company reassesses and updates credit ratings on a quarterly basis. The probability of default factors encompass historical industry defaults for liabilities with similar durations to the reinsured liabilities as estimated through multiple economic cycles. The loss given default factors are based on a study of historical recovery rates for general creditors of corporations through multiple economic cycles. Insurance Revenues Insurance Revenues Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Gross premiums, policy charges and fee income $ 2,240 $ 1,173 $ 1,210 $ 2,221 Reinsurance assumed 210 69 64 125 Reinsurance ceded (1,835) (801) (812) (1,570) Net premiums, policy charges and fee income $ 615 $ 441 $ 462 $ 776 Insurance recoveries on ceded reinsurance agreements, which reduce death and other benefits, were $1,648 for the year ended December 31, 2022 (Successor Company), $782 for the period of July 1, 2021 to December 31, 2021 (Successor Company), $958 the period of January 1, 2021 to June 30, 2021 (Predecessor Company), and $1.5 billion for the year ended December 31, 2020 (Predecessor Company). In addition, the Company has reinsured a portion of the risk associated with U.S. variable annuities and the associated GMDB and GMWB risks. |
Value of Business Acquired and
Value of Business Acquired and Deferred Acquisition Costs | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Policy Acquisition Costs and Present Value of Future Profits [Abstract] | |
Value of Business Acquired and Deferred Acquisition Costs | Value of Business Acquired and Deferred Acquisition Costs Changes in the VOBA Balance Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Balance, beginning of period [1] $ 479 $ 565 $ 586 $ 696 Amortization - VOBA (45) (17) 29 14 Amortization - unlock benefit (charge), pre-tax (34) (73) 14 (64) Adjustments to unrealized gains on fixed maturities, AFS and other 108 4 26 (60) Balance, end of period $ 508 $ 479 $ 655 $ 586 [1] The beginning balance as of July 1, 2021 differs from the ending balance as of June 30, 2021, due to the application of pushdown accounting related to the Sixth Street Acquisition. For more information, see Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements. Expected Remaining VOBA Amortization (Successor Company) 2023 $ 13 2024 $ 10 2025 $ 16 2026 $ 25 2027 $ 25 Changes in the DAC Asset (Successor Company) For the Year Ended December 31, 2022 Balance, beginning of period $ — Additions 22 Amortization - DAC — Amortization - unlock benefit (charge), pre-tax — Reinsurance impact (11) Balance, end of period $ 11 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill Carrying Value As of December 31, 2022 As of December 31, 2021 Balance, beginning of period $ 97 $ — Acquisitions [1] — 97 Balance, end of period $ 97 $ 97 [1] Related to the pushdown of purchase accounting related to the Sixth Street Acquisition. For more information, see Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements. Other Intangible Assets As of December 31, 2022 As of December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Carrying Value Gross Carrying Amount Accumulated Amortization Net Carrying Value Amortizing internally developed software $ 41 $ (9) $ 32 $ 41 $ (3) $ 38 Indefinite-lived state insurance licenses 26 — 26 26 — 26 Total other intangible assets $ 67 $ (9) $ 58 $ 67 $ (3) $ 64 Expected Pre-tax Amortization Expense as of December 31, 2022 (Successor Company) 2023 $ 6 2024 $ 6 2025 $ 6 2026 $ 6 2027 $ 6 |
Reserves for Future Policy Bene
Reserves for Future Policy Benefits and Separate Account Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Insurance [Abstract] | |
Reserves for Future Policy Benefits and Separate Account Liabilities | Reserves for Future Policy Benefits and Separate Account Liabilities Changes in Reserves for Future Policy Benefits Successor Company Universal Life-Type Contracts VA GMDB/GMWB [1] FIA Guarantees and Other [2] Universal Life Secondary Traditional Annuity and Other Contracts [3] Total Future Policy Benefits Liability Balance, as of December 31, 2021 $ 340 $ 604 $ 4,605 $ 16,149 $ 21,698 Incurred 136 (25) 835 340 1,286 Paid (106) (84) (66) (801) (1,057) Change in unrealized investment gains and losses — (495) — — (495) Liability balance, as of December 31, 2022 $ 370 $ — $ 5,374 $ 15,688 $ 21,432 Reinsurance recoverable asset, as of December 31, 2021 $ 299 $ — $ 4,605 $ 10,135 $ 15,039 Incurred 92 — 835 154 1,081 Paid (77) — (66) (446) (589) Reinsurance recoverable asset, as of December 31, 2022 $ 314 $ — $ 5,374 $ 9,843 $ 15,531 Successor Company Universal Life-Type Contracts VA GMDB/GMWB [1] FIA Guarantees and Other [2] Universal Life Secondary Traditional Annuity and Other Contracts [3] Total Future Policy Benefits Liability balance, as of July 1, 2021 $ 346 $ — $ 4,394 $ 16,382 $ 21,122 Incurred [4] 38 604 240 253 1,135 Paid (44) — (29) (486) (559) Liability balance, as of December 31, 2021 $ 340 $ 604 $ 4,605 $ 16,149 $ 21,698 Reinsurance recoverable asset, as of July 1, 2021 $ 184 $ — $ 4,394 $ 5,422 $ 10,000 Incurred 152 — 240 4,845 5,237 Paid (37) — (29) (132) (198) Reinsurance recoverable asset, as of December 31, 2021 $ 299 $ — $ 4,605 $ 10,135 $ 15,039 Predecessor Company Universal Life-Type Contracts VA GMDB/ Universal Life Secondary Traditional Annuity and Other Contracts [3] Total Future Policy Benefits Liability balance, as of December 31, 2020 $ 460 $ 4,195 $ 13,970 $ 18,625 Incurred [4] 54 217 179 450 Paid (50) (18) (319) (387) Liability balance, as of June 30, 2021 $ 464 $ 4,394 $ 13,830 $ 18,688 Reinsurance recoverable asset, as of December 31, 2020 $ 254 $ 4,195 $ 4,690 $ 9,139 Incurred [4] 35 217 78 330 Paid (41) (18) (137) (196) Reinsurance recoverable asset, as of June 30, 2021 $ 248 $ 4,394 $ 4,631 $ 9,273 [1] These liability balances include all GMDB benefits, plus the life-contingent portion of GMWB benefits in excess of the return of the GRB. GMWB benefits up to the GRB are embedded derivatives held at fair value and are excluded from these balances. [2] These liability balances include additional liabilities for expected annuitizations on two-tiered FIA's and GLWB's, as part of the Allianz reinsurance agreement entered into on December 30, 2021. [3] Represents life-contingent reserves for which the company is subject to insurance and investment risk. [4] Includes the portion of assessments established as additions to reserves, changes in estimates affecting the reserves and the amounts recoverable under modified coinsurance reinsurance agreements. Account Value by GMDB/GMWB Type as of December 31, 2022 (Successor Company) Account Net amount Retained Net Weighted MAV [1] MAV only $ 9,984 $ 2,257 $ 302 74 With 5% rollup [2] 1,478 295 196 73 With earnings protection benefit rider (“EPB”) [3] 2,414 513 55 75 With 5% rollup & EPB 336 83 21 76 Total MAV 14,212 3,148 574 Asset protection benefit (“APB”) [4] 6,165 851 282 73 Lifetime income benefit (“LIB”) – death benefit [5] 258 4 2 76 Reset (5-7 years) [6] 2,122 96 56 72 Return of premium (“ROP”) /other [7] 10,097 105 62 71 Variable annuity without GMDB [8] 2,611 — — 73 Subtotal variable annuity [11] $ 35,465 $ 4,204 $ 976 73 Less: general account value 2,983 Subtotal separate account liabilities with GMDB 32,482 Separate account liabilities - other 62,393 Less: Separate account assets assumed under modified coinsurance [12] 6,613 Separate account base contract assets not reinsured [12] 1,007 Total separate account liabilities $ 87,255 [1] MAV GMDB is the greatest of current AV, net premiums paid and the highest AV on any anniversary before age 80 years (adjusted for withdrawals). [2] Rollup GMDB is the greatest of the MAV, current AV, net premium paid and premiums (adjusted for withdrawals) accumulated at generally 5% simple interest up to the earlier of age 80 years or 100% of adjusted premiums. [3] EPB GMDB is the greatest of the MAV, current AV, or contract value plus a percentage of the contract’s growth. The contract’s growth is AV less premiums net of withdrawals, subject to a cap of 200% of premiums net withdrawals. [4] APB GMDB is the greater of current AV or MAV, not to exceed current AV plus 25% times the greater of net premiums and MAV (each adjusted for premiums in the past 12 months). [5] LIB GMDB is the greatest of current AV; net premiums paid; or, for certain contracts, a benefit amount generally based on market performance that ratchets over time. [6] Reset GMDB is the greatest of current AV, net premiums paid and the most recent five to seven year anniversary AV before age 80 years (adjusted for withdrawals). [7] ROP GMDB is the greater of current AV and net premiums paid. [8] Includes account value for contracts that had a GMDB at issue but no longer have a GMDB due to certain elections made by policyholders or their beneficiaries. [9] AV includes the contract holder’s investment in the separate account and the general account. [10] NAR is defined as the guaranteed minimum death benefit in excess of the current AV. RNAR represents NAR reduced for reinsurance. NAR and RNAR are highly sensitive to equity market movements and increase when equity markets decline. [11] Some variable annuity contracts with GMDB also have a life-contingent GMWB that may provide for benefits in excess of the return of the GRB. Such contracts included in this amount have $8.6 billion of total account value and weighted average attained age of 72 years. There is no NAR or retained NAR related to these contracts. [12] Adjustment to remove AV for separate accounts that are not reflected on the Consolidated Balance Sheets, as they were assumed on a modified coinsurance basis and/or the Company has only reinsured certain associated GMDB and GMWB riders on a coinsurance basis. Account Balance Breakdown of Variable Separate Account Investments for Contracts with Guarantees Successor Company Asset Type December 31, 2022 December 31, 2021 Equity securities (including mutual funds) $ 24,548 $ 33,240 Cash and cash equivalents [1] 1,321 1,362 Total [2] $ 25,869 $ 34,602 [1] Represents an allocation of the portfolio holdings. [2] Includes $2.6 billion and $3.0 billion of account value as of December 31, 2022 (Successor Company) and 2021 (Successor Company), respectively, for contracts that had a GMDB at issue but no longer have a GMDB due to certain elections made by policyholders or their beneficiaries. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), approximately 18% and 17%, respectively, of the equity securities (including mutual funds), in the preceding table were funds invested in fixed income securities and approximately 82% and 83%, respectively, were funds invested in equity securities. For further information on guaranteed living benefits that are accounted for at fair value, such as GMWB, see Note 2 - Fair Value Measurements of Notes to Consolidated Financial Statements. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt Collateralized Advances The Company is a member of the Federal Home Loan Bank of Boston (“FHLBB”). Membership allows the Company access to collateralized advances, which may be used to support various spread-based business and enhance liquidity management. FHLBB membership requires the Company to own member stock and advances require the purchase of activity stock. The amount of advances that can be taken are dependent on the asset types pledged to secure the advances. The CTDOI will permit the Company to pledge up to approximately $922 in qualifying assets to secure FHLBB advances for 2023. The pledge limit is recalculated annually based on statutory admitted assets and capital and surplus. The Company would need to seek the prior approval of the CTDOI in order to exceed these limits. As of December 31, 2022, the Company had no advances outstanding under the FHLBB facility. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Provision for Income Taxes Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Income Tax Expense (Benefit) Current - U.S. Federal $ (18) (86) $ — $ 10 Deferred - U.S. Federal 125 137 30 56 Total income tax expense $ 107 $ 51 $ 30 $ 66 Deferred tax assets and liabilities on the Consolidated Balance Sheets represent the tax consequences of differences between the financial reporting and tax basis of assets and liabilities. Components of Deferred Tax Assets (Liabilities) Successor Company December 31, 2022 December 31, 2021 Deferred Tax Assets Tax basis deferred policy acquisition costs $ 129 $ 110 VOBA and reserves 349 716 Net operating loss carryover 1 25 Employee benefits 4 7 Foreign tax credit carryover 16 16 Net unrealized loss on investments 703 4 Deferred reinsurance gain 228 187 Total deferred tax assets 1,430 1,065 Deferred Tax Liabilities Investment related items (366) (449) Other (13) (13) Total deferred tax liabilities (379) (462) Net deferred tax asset $ 1,051 $ 603 The statute of limitations is closed through the 2018 tax year with the exception of net operating loss ("NOL") carryforwards utilized in open tax years. Management believes that an adequate provision has been made on the consolidated financial statements for any potential adjustments that may result from tax examinations and other tax-related matters for all open tax years. As of December 31, 2022 and 2021, the Company had no reserves for uncertain tax positions. As of December 31, 2022 and 2021, there were no unrecognized tax benefits that if recognized would affect the effective tax rate and that had a reasonable possibility of significantly increasing or decreasing within the next 12 months. The Company classifies interest and penalties (if applicable) as income tax expense on the consolidated financial statements. The Company recognized no interest expense for the year ended December 31, 2022 (Successor Company), the period of July 1, 2021 to December 31, 2021 (Successor Company), the six months ended June 30, 2021 (Predecessor Company) and the year ended December 31, 2020 (Predecessor Company) . The Company had no interest payable as of December 31, 2022 and 2021. The Company does not believe it would be subject to any penalties in any open tax years and, therefore, has not recorded any accrual for penalties. The Company believes it is more likely than not that all deferred tax assets will be fully realized. In assessing the need for a valuation allowance, management considered future taxable temporary difference reversals, future taxable income exclusive of reversing temporary differences and carryovers, taxable income in open carry back years and other tax planning strategies. From time to time, tax planning strategies could include holding a portion of debt securities with market value losses until recovery, making investments which have specific tax characteristics and business considerations such as asset-liability matching. Net deferred income taxes include the future tax benefits associated with the net operating loss carryover and foreign tax credit carryover as follows: Net Operating Loss Carryover As of December 31, 2022 and 2021, the net deferred tax asset included the expected tax benefit attributable to net operating losses of $3 and $117, respectively. These U.S. losses that were generated in 2018 were primarily due to the Commonwealth annuity reinsurance agreement. These losses do not expire, but their utilization in any carryforward year is limited to 80% of taxable income in that year. The loss carryforwards are also subject to Internal Revenue Code Section 382, which may limit the amount that can be utilized in any carryforward year. Given the Company's expected future earnings, the Company believes sufficient taxable income will be generated in the future to utilize its net operating loss carryover. Although the Company believes there will be sufficient future taxable income to fully recover the remainder of the loss carryover, the Company's estimate of the likely realization may change over time. Foreign Tax Credit Carryover As of December 31, 2022 and 2021, the net deferred tax asset included the expected tax benefit attributable to foreign tax credit carryovers of $16 and $16, respectively. A reconciliation of the tax provision at the U.S. Federal statutory rate to the provision (benefit) for income taxes is as follows. Income Tax Rate Reconciliation Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Tax provision at U.S. Federal statutory rate $ 152 $ 70 $ 45 $ 98 Dividends received deduction ("DRD") (38) (16) (14) (28) Foreign related investments (7) (2) (1) (4) Other — (1) — — Provision for income taxes $ 107 $ 51 $ 30 $ 66 The separate account DRD is estimated for the current year using information from the most recent return, adjusted for current year equity market performance and other appropriate factors, including estimated levels of corporate dividend payments and level of policy owner equity account balances. The actual current year DRD can vary from estimates based on, but not limited to, changes in eligible dividends received in the mutual funds, amounts of distributions from these mutual funds and the Company’s taxable income before the DRD. The Company evaluates its DRD computations on a quarterly basis. Corporate Alternative Minimum Tax ("CAMT") The Inflation Reduction Act of 2022 introduced a 15% CAMT effective in 2023. Generally, the CAMT imposes a minimum tax on the adjusted financial statement income ("AFSI") of certain corporations with average annual AFSI over a three-year period in excess of $1 billion. While the Company does not anticipate being subject to the CAMT in 2023, it could be subject to the CAMT in future years. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Contingencies Relating to Corporate Litigation and Regulatory Matters Management evaluates each contingent matter separately. A loss is recorded if probable and reasonably estimable. Management establishes reserves for these contingencies at its “best estimate,” or, if no one number within the range of possible losses is more probable than any other, the Company records an estimated liability at the low end of the range of losses. Litigation The Company is involved in claims litigation arising in the ordinary course of business with respect to life and annuity contracts. The Company accounts for such activity through the establishment of reserves for future policy benefits. Management expects that the ultimate liability, if any, with respect to such ordinary-course claims litigation, after consideration of provisions made for potential losses and costs of defense, will not be material to the consolidated financial condition, results of operations or cash flows of the Company. The Company is also involved in other kinds of legal actions, some of which assert claims for substantial amounts. Such actions have alleged, for example, bad faith in the handling of insurance claims and improper sales practices in connection with the sale of insurance and investment products. Some of these actions also seek punitive damages. Management expects that the ultimate liability, if any, with respect to such lawsuits, after consideration of provisions made for estimated losses, will not be material to the consolidated financial condition of the Company. Nonetheless, given the large or indeterminate amounts sought in certain of these actions, and the inherent unpredictability of litigation, it is possible that an adverse outcome in certain matters could, from time to time, have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows in particular quarterly or annual periods. Unfunded Commitments As of December 31, 2022 (Successor Company), the Company had outstanding commitments totaling $974, of which $410 was committed to fund limited partnerships and other alternative investments, which may be called by the partnership during the commitment period to fund the purchase of new investments and partnership expenses. Additionally, $323 of the outstanding commitments are primarily related to various funding obligations associated with private debt. The remaining outstanding commitments of $241 are related to mortgage loans. Of the $974 in total outstanding commitments, $29 are related to mortgage loan commitments, which the Company can cancel unconditionally. Guaranty Fund and Other Insurance-Related Assessments In all states, insurers licensed to transact certain classes of insurance are required to become members of a guaranty fund. In most states, in the event of the insolvency of an insurer writing any such class of insurance in the state, members of the funds are assessed to pay certain claims of the insolvent insurer. A particular state’s fund assesses its members based on their respective written premiums in the state for the classes of insurance in which the insolvent insurer was engaged. Assessments are generally limited for any year to one or two percent of premiums written per year depending on the state. Liabilities for guaranty funds and other insurance-related assessments are accrued when an assessment is probable, when it can be reasonably estimated, and when the event obligating the Company to pay an imposed or probable assessment has occurred. Liabilities for guaranty funds and other insurance-related assessments are not discounted and are included as part of other liabilities on the Consolidated Balance Sheets. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the liability balance was $4 and $4, respectively. As of December 31, 2022 (Successor Company) and 2021 (Successor Company) amounts related to premium tax offsets of $1 and $1, respectively, were included in other assets on the Consolidated Balance Sheets. Derivative Commitments Certain of the Company’s derivative agreements contain provisions that are tied to the financial strength ratings, as set by nationally recognized statistical agencies or risked-based capital ("RBC") tests, of the individual legal entity that entered into the derivative agreement. If the legal entity’s financial strength were to fall below certain ratings, the counterparties to the derivative agreements could demand immediate and ongoing full collateralization and in certain instances enable the counterparties to terminate the agreements and demand immediate settlement of all outstanding derivative positions traded under each impacted bilateral agreement. The settlement amount is determined by netting the derivative positions transacted under each agreement. If the termination rights were to be exercised by the counterparties, it could impact the legal entity’s ability to conduct hedging activities by increasing the associated costs and decreasing the willingness of counterparties to transact with the legal entity. The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a net liability position as of December 31, 2022 (Successor Company) was $110. Of this $110, the legal entities have posted collateral of $111 in the normal course of business. In addition, the Company did not post any collateral associated with a customized GMWB derivative. This could change as derivative market values change, as a result of changes in our hedging activities or to the extent changes in contractual terms are negotiated. The nature of |
Transactions with Affiliates
Transactions with Affiliates | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Transactions with Affiliates | Transactions with Affiliates Intercompany Liquidity Agreements In 2022, the Company entered into several short-term affiliated intercompany liquidity agreements, permitting TL to borrow a maximum of $1.5 billion and lend a maximum of $500 and the Company's subsidiary to borrow a maximum of $600 and lend a maximum of $200. On October 13, 2022 (Successor Company), an affiliate borrowed $100, with a maturity date of October 13, 2023, and an accrued interest rate of 3.40% per annum. As of December 31, 2022, the Company recorded such affiliated borrowing of $100 in short-term investments on the Consolidated Balance Sheets. As of December 31, 2022, the Company did not borrow any amounts under the intercompany liquidity agreements. Parent Company Transactions As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the Company had no direct employees as it is managed by TLI, the Company's indirect parent, pursuant to an Intercompany Services and Cost Allocation Agreement ("reimbursement agreement") between the Company, TLI and other Company affiliates. Effective July 1, 2021, the reimbursement agreement was modified to reflect a cost-plus reimbursement model. The impact of this revision was not material to the Company. TLI's wholly-owned subsidiary Talcott Administration Services Company, LLC ("TASC") provides insurance administration services and support for the Company and became a related party on October 21, 2021. For the year ended December 31, 2022 (Successor Company) and the period from October 1, 2021 to December 31, 2021 (Successor Company), fees incurred for these services were $53 and $14. For information related to affiliated reinsurance arrangements with the Company's parent company TR Re, see Note 1 - Basis of Presentation and Significant Accounting Policies and Note 5 - Reinsurance of Notes to Consolidated Financial Statements. For information related to capital contributions to the parent company, see the Dividends section of Note 13 - Statutory Results of Notes to Consolidated Financial Statements. Sixth Street Transactions As a result of the Sixth Street Acquisition described in Note 1 - Basis of Presentation and Significant Accounting Policies, the Company considers entities affiliated with Sixth Street as related parties. As described below, since the date of the Sixth Street Acquisition, the Company has entered into certain agreements with and made certain investments in Sixth Street affiliates. The Company has investment management service agreements with a Sixth Street affiliate, in order to diversify the Company’s investment management capabilities and to leverage the specialty knowledge of Sixth Street with respect to certain asset classes. For the year ended December 31, 2022 (Successor Company) and the period of July 1, 2021 to December 31, 2021 (Successor Company), the Company recorded expenses related to these agreements of $1 and $0, respectively. As of December 31, 2022 and 2021 (Successor Company), amounts payable under the agreements were $0 and $0, respectively. For the year ended December 31, 2022, the Company made certain investments totaling $12 that are issued and controlled by Sixth Street affiliates. The Company was not determined to be the primary beneficiary for these investments. As of December 31, 2022 (Successor Company) outstanding commitments for these investments were $49. There were no affiliated investments on the Company's Consolidated Balance Sheets as of December 31, 2021. |
Statutory Results
Statutory Results | 12 Months Ended |
Dec. 31, 2022 | |
Insurance [Abstract] | |
Statutory Results | Statutory Results The Company and its domestic insurance subsidiaries prepare their statutory financial statements in conformity with statutory accounting practices prescribed or permitted by the applicable state insurance department which vary materially from U.S. GAAP. Prescribed statutory accounting practices include publications of the National Association of Insurance Commissioners (“NAIC”), as well as state laws, regulations and general administrative rules. The differences between statutory financial statements and financial statements prepared in accordance with U.S. GAAP vary between domestic and foreign jurisdictions. The principal differences are that statutory financial statements do not reflect deferred policy acquisition and value of business acquired costs and limit deferred income taxes, predominately use interest rate and mortality assumptions prescribed by the NAIC for life benefit reserves, generally carry bonds at amortized cost and present reinsurance assets and liabilities net of reinsurance. For reporting purposes, statutory capital and surplus is referred to collectively as "statutory capital". Statutory Net Income (Loss) Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Combined statutory net income (loss) $ 441 $ (426) $ (2) $ 245 Statutory Capital Successor Company December 31, 2022 December 31, 2021 Statutory capital [1] $ 2,738 $ 2,153 [1] The Company relies upon a prescribed practice allowed by Connecticut state laws that allow the Company to receive a reinsurance reserve credit for reinsurance treaties that provide for a limited right of unilateral cancellation by the reinsurer. The benefit from this prescribed practice was approximately $40 and $29 as of December 31, 2022 (Successor Company) and 2021 (Successor Company), respectively. Statutory accounting practices do not consolidate the net income (loss) of subsidiaries that report under U.S. GAAP. The combined statutory net income (loss) above represents the total statutory net income (loss) of the Company and its other insurance subsidiaries. Statutory accounting principles require that ceding commissions paid on reinsurance transactions be expensed in the period incurred, affecting statutory net loss, where U.S. GAAP allows for the deferral of these amounts. In addition, as described in Note 1 - Basis of Presentation and Significant Accounting Policies, in 2021 the Company paid a $500 dividend associated with the Sixth Street Acquisition. Both items affected statutory capital. Regulatory Capital Requirements The Company's U.S. insurance companies' states of domicile impose RBC requirements. The requirements provide a means of measuring the minimum amount of statutory capital appropriate for an insurance company to support its overall business operations based on its size and risk profile. Regulatory compliance is determined by a ratio of a company's total adjusted capital (“TAC”) to its authorized control level RBC (“ACL RBC”). Companies below specific trigger points or ratios are classified within certain levels, each of which requires specified corrective action. The minimum level of TAC before corrective action commences (“Company Action Level”) is two times the ACL RBC. The adequacy of a company's capital is determined by the ratio of a company's TAC to its Company Action Level, known as the "RBC ratio." The Company and all of its operating insurance subsidiaries had RBC ratios in excess of the minimum levels required by the applicable insurance regulations. The RBC ratios for the Company and its principal life insurance operating subsidiaries were all in excess of 300% of their Company Action Levels as of December 31, 2022 (Successor Company) and 2021 (Successor Company) .The reporting of RBC ratios is not intended for the purpose of ranking any insurance company, or for use in connection with any marketing, advertising or promotional activities. Dividends As a condition to the Sixth Street Acquisition, the CTDOI requires any dividends from the Company, for a two-year period following the acquisition, be approved by the state insurance commissioner. Subsequent to this approval condition, dividends to the Company from its insurance subsidiaries and dividends from the Company to its parent are restricted by insurance regulation. The payment of dividends by Connecticut-domiciled insurers is limited under the insurance holding company laws of Connecticut. These laws require notice to and approval by the state insurance commissioner for the declaration or payment of any dividend, which, together with other dividends or distributions made within the preceding twelve months, exceeds the greater of (i) 10% of the insurer’s policyholder surplus as of December 31 of the preceding year or (ii) net income (or net gain from operations, if such company is a life insurance company) for the twelve-month period ending on the thirty-first day of December last preceding, in each case determined under statutory insurance accounting principles. In addition, if any dividend of a domiciled insurer exceeds the insurer’s earned surplus or certain other thresholds as calculated under applicable state insurance law, the dividend requires the prior approval of the domestic regulator. In addition to statutory limitations on paying dividends, the Company also takes other items into consideration when determining dividends from subsidiaries. These considerations include, but are not limited to, expected earnings and capitalization of the subsidiary, regulatory capital requirements and liquidity requirements of the individual operating company. Absent the restrictions noted above, the Company would be permitted to pay up to a maximum of $578 in dividends and the Company's subsidiaries are permitted to pay up to a maximum of $96 in dividends as determined by the above mentioned insurance regulations. On June 28, 2021 (Predecessor Company), TL paid a $500 dividend to its then parent, TLI. On September 18, 2020 (Predecessor Company), TL received a $400 dividend from its subsidiary, Talcott Resolution Life and Annuity Insurance Company ("TLA"). On the same date, TL subsequently declared and paid a $319 dividend to its parent TLI. |
Changes in and Reclassification
Changes in and Reclassifications From Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in and Reclassifications From Accumulated Other Comprehensive Income | Changes in and Reclassifications From Accumulated Other Comprehensive Income Changes in AOCI, Net of Tax for the Year Ended December 31, 2022 (Successor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ (10) $ — $ (10) OCI before reclassifications (3,107) (34) (3,141) Amounts reclassified from AOCI 412 — 412 OCI, before tax (2,695) (34) (2,729) Income tax benefit (expense) 566 7 573 OCI, net of tax (2,129) (27) (2,156) Ending balance $ (2,139) $ (27) $ (2,166) Changes in AOCI, Net of Tax for the Period of July 1, 2021 to December 31, 2021 (Successor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ — $ — $ — OCI before reclassifications (14) — (14) Amounts reclassified from AOCI 2 — 2 OCI, before tax (12) — (12) Income tax benefit (expense) 2 — 2 OCI, net of tax (10) — (10) Ending balance $ (10) $ — $ (10) Changes in AOCI, Net of Tax for the Six Months Ended June 30, 2021 (Predecessor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ 1,282 $ (1) $ 1,281 OCI before reclassifications (301) — (301) Amounts reclassified from AOCI (47) 1 (46) OCI, before tax (348) 1 (347) Income tax benefit (expense) 73 — 73 OCI, net of tax (275) 1 (274) Ending balance $ 1,007 $ — $ 1,007 Changes in AOCI, Net of Tax for the Year Ended December 31, 2020 (Predecessor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Unrealized Losses on Fixed Maturities, AFS for Which an ACL Has Been Recorded Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ 717 $ — $ — $ 717 OCI before reclassifications 842 (1) (1) 840 Amounts reclassified from AOCI (127) 1 — (126) OCI, before tax 715 — (1) 714 Income tax benefit (expense) (150) — — (150) OCI, net of tax 565 — (1) 564 Ending balance $ 1,282 $ — $ (1) $ 1,281 Reclassification from AOCI Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Affected Line Item on the Consolidated Statements Net Unrealized Gain on Fixed Maturities Available-for-sale securities $ (412) $ (2) $ 47 $ 127 Net realized capital gains (losses) (412) (2) 47 127 Income before income taxes (87) — 10 27 Income tax expense $ (325) $ (2) $ 37 $ 100 Net income Unrealized Losses on Fixed Maturities for Which an ACL Has Been Recorded Fixed maturities, AFS $ — $ — $ — $ (1) Net realized capital gains (losses) — — — (1) Income before income taxes — — — — Income tax expense $ — $ — $ — $ (1) Net income Net Gains on Cash-Flow Hedging Instruments Interest rate swaps $ — $ — $ — $ — Net realized capital gains (losses) Interest rate swaps — — — — Net investment income Foreign currency swaps — — (1) — Net realized capital gains (losses) — — (1) — Income before income taxes — — — — Income tax expense $ — $ — $ (1) $ — Net income Total amounts reclassified from AOCI $ (325) $ (2) $ 36 $ 99 Net income |
Revenue from Contracts with Cus
Revenue from Contracts with Customer | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customer | Revenue from Contracts with Customers The Company follows the FASB’s updated guidance for recognizing revenue from contracts with customers which excludes insurance contracts and financial instruments. Revenue subject to the guidance is recognized when, or as, goods or services are transferred to customers in an amount that reflects the consideration that an entity is expected to receive in exchange for those goods or services. Revenues from Contracts with Customers Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Administration and distribution services fees $ 76 $ 45 $ 44 $ 80 The Company earns revenues from these contracts primarily for administrative and distribution services fees from offering certain fund families as investment options in its variable annuity products. Fees are primarily based on the average daily net asset values of the funds and are recorded in the period in which the services are provided and collected monthly. Fluctuations in domestic and international markets and related investment performance, volume and mix of sales and redemptions of the funds, and other changes to the composition of assets under management are all factors that ultimately have a direct effect on fee income earned. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent EventThe Company has evaluated subsequent events through April 27, 2023, the date the consolidated financial statements were issued. On January 27, 2023, pursuant to the Intercompany Liquidity Agreements discussed in Note 12 -Transactions with Affiliates, an affiliate borrowed $60 from the Company. The intercompany loan has a maturity date of January 26, 2024, and accrues at an interest rate of 4.50% per annum. |
Schedule I - Summary of Investm
Schedule I - Summary of Investments - Other Than Investments in Affiliates | 12 Months Ended |
Dec. 31, 2022 | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Abstract] | |
Summary of Investments - Other Than Investments in Affiliates | SCHEDULE I SUMMARY OF INVESTMENTS—OTHER THAN INVESTMENTS IN AFFILIATES ($ in millions) Successor Company As of December 31, 2022 Type of Investment Cost Fair Amount at Which Shown on Balance Sheet Fixed Maturities Bonds and notes: U.S. government and government agencies and authorities (guaranteed and sponsored) $ 1,395 $ 1,070 $ 1,070 States, municipalities and political subdivisions 1,320 1,040 1,040 Foreign governments 379 315 315 Public utilities 1,776 1,423 1,423 All other corporate bonds 10,769 8,818 8,818 All other mortgage-backed and asset-backed securities 3,050 2,717 2,717 Total fixed maturities, available-for-sale 18,689 15,383 15,383 Fixed maturities, at fair value using fair value option 352 331 331 Total fixed maturities 19,041 15,714 15,714 Equity Securities Common stocks: Industrial, miscellaneous and all other 14 14 14 Non-redeemable preferred stocks 191 165 165 Total equity securities, at fair value 205 179 179 Mortgage loans [1] 2,535 2,232 2,520 Policy loans 1,495 1,495 1,495 Futures, options and miscellaneous 384 85 85 Real estate acquired in satisfaction of debt 10 10 10 Short-term investments 1,489 1,489 1,489 Investments in partnerships and trusts 1,300 1,300 Total investments $ 26,459 $ 22,792 [1] Cost of mortgage loans excludes the allowance for credit losses ("ACL") of $15. For further information, refer to Schedule V - Valuation and Qualifying Accounts. |
Schedule IV - Schedule of Reins
Schedule IV - Schedule of Reinsurance | 12 Months Ended |
Dec. 31, 2022 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
Schedule IV - Schedule of Reinsurance | SCHEDULE IV REINSURANCE ($ In millions) Gross Amount Ceded to Other Companies Assumed From Other Companies Net Percentage of Amount Assumed For the Year Ended December 31, 2022 (Successor Company) Life insurance in-force $ 222,398 $ 158,750 $ 155 $ 63,803 — % Insurance Revenues Life insurance and annuities $ 2,228 $ 1,823 $ 210 $ 615 34 % Accident health insurance 12 12 — — — % Total insurance revenues $ 2,240 $ 1,835 $ 210 $ 615 34 % For the Period of July 1, 2021 to December 31, 2021 (Successor Company) Life insurance in-force $ 232,607 $ 166,822 $ 158 $ 65,943 — % Insurance Revenues Life insurance and annuities $ 1,170 $ 798 $ 69 $ 441 16 % Accident health insurance 3 3 — — — % Total insurance revenues $ 1,173 $ 801 $ 69 $ 441 16 % For the Six Months Ended June 30. 2021 (Predecessor Company) Life insurance in-force $ 236,517 $ 170,776 $ 166 $ 65,907 — % Insurance Revenues Life insurance and annuities $ 1,202 $ 804 $ 64 $ 462 14 % Accident health insurance 8 8 — — — % Total insurance revenues $ 1,210 $ 812 $ 64 $ 462 14 % For the Year Ended December 31, 2020 (Predecessor Company) Life insurance in-force $ 239,801 $ 174,372 $ 173 $ 65,602 — % Insurance Revenues Life insurance and annuities $ 2,201 $ 1,550 $ 125 $ 776 16 % Accident health insurance 20 20 — — — % Total insurance revenues $ 2,221 $ 1,570 $ 125 $ 776 16 % |
Schedule V - Valuation and Qual
Schedule V - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2022 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule V - Valuation and Qualifying Accounts | SCHEDULE V VALUATION AND QUALIFYING ACCOUNTS (In millions) Successor Company 2022 Balance January 1, Charged to Costs and Expenses Write-offs/Payments/Other Balance December 31, Allowance for credit losses ("ACL") on fixed maturities, AFS $ — $ 1 $ (1) $ — ACL on mortgage loans 12 3 — 15 ACL on reinsurance recoverables 37 — (10) 27 2021 Balance Charged to Costs and Expenses Write-offs/Payments/Other Balance ACL on fixed maturities, AFS — — — — ACL on mortgage loans 12 — — 12 ACL on reinsurance recoverables 34 3 — 37 Predecessor Company 2021 Balance Charged to Costs and Expenses Write-offs/Payments/Other Balance ACL on fixed maturities, AFS 1 — — 1 ACL on mortgage loans 17 (6) — 11 ACL on reinsurance recoverables 7 — — 7 2020 Balance January 1, Charged to Costs and Expenses Write-offs/Payments/Other Balance December 31, ACL on fixed maturities, AFS — 1 — 1 ACL on mortgage loans 9 8 — 17 ACL on reinsurance recoverables 5 2 — 7 |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Talcott Resolution Life Insurance Company, together with its consolidated subsidiaries, (collectively, "TL," the "Company," "we" or "our") is a life insurance and annuity company and comprehensive risk solutions-provider in the United States ("U.S.") and is a wholly-owned subsidiary of TR Re, Ltd. ("TR Re"), a Bermuda based entity. Talcott Resolution Life, Inc. ("TLI"), a Delaware corporation and Talcott Holdings, L.P. ("THLP") are indirect parents of the Company and the Company has an ultimate parent of Talcott Financial Group, Ltd. ("TFG" or "Talcott Financial Group"). The Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”), which differ materially from the accounting practices prescribed by various insurance regulatory authorities. Certain reclassifications have been made to conform to current year presentation. |
Consolidation | Consolidation The Consolidated Financial Statements include the accounts of the Company and entities the Company directly or indirectly has a controlling financial interest in which the Company is required to consolidate. Entities in which the Company has significant influence over the operating and financing decisions but is not required to consolidate are reported using the equity method. All intercompany transactions and balances between the Company and its subsidiaries have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The most significant estimates include: • Valuation of investments, including the underlying investments within the funds withheld liability; • Evaluation of credit losses on fixed maturities, available for sale ("AFS"); • Allowance for credit losses (“ACL”) on mortgage loans; • Valuation of derivative assets and liabilities, including embedded derivatives; • Valuation of liabilities associated with FIA; • Estimated gross profits ("EGPs") used to amortize VOBA and liabilities associated with variable annuities, FIA, and other universal life-type contracts, as well as certain deferred reinsurance amounts; • Evaluation of goodwill and other intangible assets for impairment; • Valuation of living withdrawal benefits and FIA required to be recorded at fair value; • Valuation of value of business acquired ("VOBA"), deferred gains on reinsurance, and deferred acquisition costs ("DAC"); • Valuation allowance on deferred tax assets; • Contingencies relating to corporate litigation and regulatory matters Certain of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the Consolidated Financial Statements. |
Pushdown Accounting | Pushdown Accounting Sixth Street The Sixth Street Acquisition was accounted for using business combination accounting, together with an election to apply pushdown accounting. The goodwill from the Sixth Street Acquisition is attributable to the Company's expectation that the combined group can leverage its insurance platform to become a life insurance aggregator. Goodwill for the Sixth Street Acquisition is not deductible for tax purposes. The following table represents the final determination of the fair value of the assets acquired and liabilities assumed for the Sixth Street Acquisition: Cash and invested assets $ 19,711 VOBA 565 Deferred income taxes 737 Goodwill 97 Other intangible assets 67 Reinsurance recoverables and other assets [1] 30,481 Separate account assets 112,857 Total assets 164,515 Reserves for future policy benefits 21,122 Other policyholder funds and benefits payable 25,961 Funds withheld liability [1] 1,039 Other liabilities 1,653 Separate account liabilities 112,857 Total liabilities 162,632 Stockholder's equity 1,883 Total liabilities and stockholder's equity $ 164,515 [1] Previously reported table was updated to reflect the gross presentation for modified coinsurance reinsurance transactions. The Successor Company's assets and liabilities are recognized based on TFG’s accounting basis, with an offset to additional paid-in capital. In addition, retained earnings and accumulated other comprehensive income (“AOCI”) of the Predecessor Company are not carried forward, as a new basis of accounting has been established. Invested Assets The acquired investments are recorded at fair value through adjustments to additional paid-in capital at the acquisition date. Value of Business Acquired/Additional Reserves In conjunction with the acquisition of the Company, a portion of the purchase price was allocated to the right to receive future gross profits from cash flows and earnings of the Company's insurance and investment contracts as of the date of the Sixth Street Acquisition. This intangible asset is called VOBA and is based on the actuarially estimated present value of future cash flows from the Company's insurance and investment contracts in-force as of the date of the transaction. The estimated fair value calculation of VOBA is based on certain assumptions, including equity market returns, mortality, persistency, expenses, discount rates, and other factors that the Company expects to experience in future years. Actual experience on the acquired contracts may vary from these projections and the recovery of VOBA is dependent upon the future profitability of the related business. The Company amortizes VOBA over EGPs and it is reviewed for recoverability quarterly. The fair value of certain acquired obligations of the Company exceeded the book value of assumed in-force policy liabilities resulting in additional reserve liabilities. These liabilities were increased to fair value, which is presented separately from VOBA as an additional insurance liability in other policyholder funds and benefits payable. The additional liability is amortized to income over the life of the underlying policies. Goodwill Goodwill represents the excess of the acquisition cost of an acquired business over the fair value of assets acquired and liabilities assumed. Goodwill is not amortized but is tested for impairment at the entity or reporting unit level annually or when events or circumstances arise, such as adverse changes in the business climate, that would more likely than not reduce the fair value of the entity or a reporting unit below its carrying value. Our methodology for conducting this goodwill impairment testing contains both a qualitative and quantitative assessment. The Company has the option to initially perform an assessment of qualitative factors in order to determine whether it is more likely than not that the fair value of the entity or a reporting unit is less than its carrying amount. The qualitative factors may include, but are not limited to, economic conditions, industry and market considerations, cost factors, overall financial performance of the entity or a reporting unit and other company and entity-level or reporting unit-specific events. If it is determined that it is more likely than not that the fair value of the entity or reporting unit is less than its carrying amount, we then perform the impairment evaluation using a more detailed quantitative assessment. If the carrying values of the entity or reporting units were to exceed their fair value under that quantitative assessment, the amount of the impairment would be calculated and goodwill would be adjusted accordingly. The Company could directly perform this quantitative assessment, bypassing the qualitative assessment and perform a quantitative impairment test. As a result of the quantitative review performed for the year ended December 31, 2022, the Company determined that the estimated fair value of TL exceeded its respective carrying value and that goodwill was not impaired. For the year ended December 31, 2021, the Company determined that the goodwill associated with TL was not impaired. For a discussion of goodwill from the Sixth Street Acquisition, refer to Note 7 - Goodwill and Other Intangible Assets. Other Intangible Assets Intangible assets with definite lives are amortized over the estimated useful life of the asset. Amortizing intangible assets primarily consists of internally developed software amortized over a period not to exceed seven years. Intangible assets with indefinite lives, primarily insurance licenses, are not amortized but are reviewed annually in the Company's impairment analysis. They will be tested for impairment more frequently if events or circumstances indicate the fair value of indefinitely lived intangibles is less than the carrying value. The Company determined during its reviews for December 31, 2022 and 2021 that its other indefinite-lived intangible assets and finite-lived intangible assets were not impaired. For a discussion of other intangible assets from the Sixth Street Acquisition, refer to Note 7 - Goodwill and Other Intangible Assets. |
Adoption of New Accounting Standards and Future Adoption of New Accounting Standards | Future Adoption of New Accounting Standards Troubled Debt Restructurings and Vintage Disclosure s The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2022-02, Financial Instruments – Credit Losses (Topic 326) – Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”) in March 2022, which eliminates the accounting guidance on troubled debt restructurings for creditors and amends the guidance on vintage disclosures. The amendments require that an entity evaluate whether the loan modification represents a new loan or a continuation of an existing loan, and introduce new requirements related to modifications made to borrowers experiencing financial difficulty. Additionally, ASU 2022-02 enhances disclosures for borrowers experiencing financial difficulty, by requiring current-period gross write-offs by year of origination for creditors with respect to loan refinancing and restructurings and internal risk ratings for financing receivables. ASU 2022-02 is effective for annual periods beginning after December 15, 2022 and interim periods within those annual periods, with early adoption permitted. The Company will adopt the amendments of ASU 2022-02 prospectively in the first quarter of 2023 and does not expect it to have a material impact on the Company. Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions The FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”) in June 2022. ASU 2022-03 clarifies that a contractual sales restriction is not considered in measuring an equity security at fair value and to introduce new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value. ASU 2022-03 applies to both holders and issuers of equity and equity-linked securities measured at fair value. The amendments in ASU 2022-03 are effective for the Company in fiscal years beginning after December 15, 2023, and interim periods within those fiscal years, with early adopted permitted. The Company will adopt the provisions of ASU 2022-03 in the first quarter of 2024 and does not expect it to have a material impact on the Company. Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The FASB issued ASU 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”) in October 2021, which requires acquiring entities to apply Topic 606, Revenue from Contracts with Customers upon recognizing and measuring contract assets and liabilities in a business combination. This update is intended to improve comparability after a business combination, by providing consistent recognition and measurement of revenue contracts with customers acquired and not acquired in a business combination. ASU 2021-08 is effective for annual periods beginning after December 15, 2022 and interim periods within those annual periods, with early adoption permitted. The amendments in ASU 2021-08 should be applied prospectively. We will adopt the provisions of this ASU in the first quarter of 2023 and do not expect it to have a material impact on the Company. Targeted Improvements to the Accounting for Long Duration Contracts The FASB issued ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts ("ASU 2018-12") in August 2018, which impacts the existing recognition, measurement, presentation, and disclosure requirements for certain long-duration contracts issued by an insurance company. The guidance is intended to improve the timeliness of recognizing changes in the liability for future policy benefits ("LFPB"), by requiring annual or more frequent updates of insurance assumptions and modifying rates used to discount future cash flows. Further, the guidance seeks to improve the accounting for certain market-based options or guarantees associated with account balance contracts, simplify the amortization of DAC and other balances amortized on a basis consistent with DAC, and improve the effectiveness of the required disclosures. This guidance was amended through the issuance of ASU 2020-11, which deferred the effective date the Company is required to adopt the guidance to January 1, 2023 with early adoption permitted. Through the issuance of ASU 2022-05, an insurance entity is permitted, prior to the effective date, to exclude certain contracts from applying the amendments in ASU 2018-12, when those contracts have been derecognized because of a sale or disposal of an individual or a group of contracts or legal entities and in which the insurance entity has no significant continuing involvement with the derecognized contracts. The Company does not currently intend to apply this accounting policy election. The Company intends to use the full retrospective adoption method, as of the date of the Sixth Street Acquisition. The Company does not expect an impact to stockholder's equity as a result of the adoption of ASU 2018-12, due to the application of purchase accounting; whereby assets and liabilities were transacted at fair value as of the date of the acquisition. Upon the adoption of ASU 2018-12, the change in the carrying value of insurance assets and liabilities as of July 1, 2021 are recorded with an equal and offsetting adjustment to VOBA or an additional reserve. Refer below for further discussion of other impacts upon adoption to the new standard. The adoption is expected to have a material effect on the Company’s results of operations due to the updating of cash flow assumptions for LFPB, recognition of changes to the fair value of market risk benefits (“MRB”), and the change in amortization methodology for DAC and other DAC-like balances. The Company has made key accounting policy decisions, including insurance policy groupings for recognition and measurement of LFPB, discount rate methodology, development of liability cash flow and claim expense assumptions, and DAC and other DAC-like amortization methodology. Outlined below are four key areas of change, although there are other less significant policy changes not noted below. Amended Topic Description Adoption Method and Transition Impact Cash flow and discount rate assumptions underlying insurance liabilities For nonparticipating traditional and limited-payment insurance contracts, the Company will evaluate, at least annually in the same fiscal quarter, as to whether an update to cash flow assumptions is needed. The Company will update the cash flows used to measure the LFPB, for both changes in future assumptions and actual experience, at least annually. The updating of cash flows impacts the amount of the deferred profit liability (“DPL”) recorded for limited-payment contracts. The DPL will be adjusted concurrently with any updating of the LFPB. Cash flows are required to be discounted with an upper-medium grade (or low credit risk) fixed-income instrument yield, with the effect of discount rate changes on the liability recorded in other comprehensive income (“OCI”). The discount rate utilized is intended to reflect the duration characteristics of the corresponding insurance liabilities. The Company will obtain yield curves and spreads for a range of tenors to determine spot yields to discount the cash flows of the insurance liabilities as of each valuation date. The Company will adopt the guidance for LFPB, as of the date of the Sixth Street Acquisition. As of the acquisition date, the Company expects there will be a decrease to LFPB (and the associated reinsurance recoverable), which will be offset by a net increase to an additional reserve. This is due to the application of purchase accounting associated with the Sixth Street Acquisition, which employed lower discount rates for the fair value calculations than the required discount rates to value the cash flows on the insurance liabilities under ASU 2018-12. MRB The Company currently offers and assumes certain guarantees and product features on variable annuity and FIA products, which protect the contractholder from other-than-nominal capital market risk and expose the Company to other-than-nominal capital market risk. These MRB features are required to be measured at fair value with changes in fair value recorded in net income, with the exception of the changes in MRB liabilities attributable to a change in an entity’s nonperformance risk, which is required to be recognized in OCI. For products that are reinsured, the portion of the change in MRB attributable to changes in the reinsurer’s nonperformance risk is recognized in income. The Company shall maximize the use of relevant observable information and minimize the use of unobservable information in determining the balance of the MRB upon adoption. The Company will adopt the guidance for MRB using the full retrospective method. As of the acquisition date, the Company expects there to be an increase to the MRB liability (and the associated reinsurance recoverable) and a decrease to VOBA, as a result of the difference between the establishment of the MRB recorded at fair value under ASU 2018-12 and reserves previously recorded for those benefits. Amortization of DAC and other DAC-like balances The Company will amortize DAC and other DAC-like balances on a constant-level basis over the expected term for a group of contracts consistent with the groupings used in estimating the associated LFPB. The constant-level basis for the group approximates a pattern of straight-line amortization at an individual contract level by using a method specific to the underlying product. The amortization rate utilized is calculated at the end of the current reporting period, including actual experience and any assumption updates. The revised amortization rate is applied prospectively from the beginning of the current reporting period. As a result of amortizing DAC and other DAC-like balances on a constant-level basis, the Company does not expect a significant impact upon the adoption of ASU 2018-12. Reporting and Disclosures ASU 2018-12 requires certain enhanced presentation and disclosures including disaggregated rollforwards for LFPB, policyholder account balances, MRB, separate account liabilities, DAC and other DAC-like balances, and information about significant inputs, judgments and methods used in the LFPB measurement. The enhanced disclosures are intended to improve the ability of users of the financial statements to evaluate the timing, amount, and uncertainty of cash flows arising from long-duration contracts. The Company’s implementation efforts and the evaluation of the impacts of the guidance on its consolidated financial statements, as well as its systems, processes, and controls, continue to progress. Given the nature and extent of the required changes to a significant portion of the Company’s operations, the adoption of this guidance is expected to have a material impact on its financial position and results of operations. In addition, there will be a significant increase in required disclosures. |
Segment Information | Segment Information The Company has no reportable segments and its principal products and services are comprised of variable, fixed and payout annuities, FIAs, and private-placement life insurance. The Company's determination that it has no reportable segments is based on the fact that the Company's chief operating decision maker reviews the Company's financial performance at a consolidated level. |
Revenue Recognition | Revenue Recognition For investment and universal life-type contracts, the amounts collected from policyholders are considered deposits and are not included in revenue. Policy charges and fee income for variable annuity, FIA, deferred annuity and other universal life-type contracts primarily consists of policy charges for policy administration, cost of insurance charges and surrender charges assessed against policyholders’ account balances and are recognized in the period in which services are provided. For the Company’s traditional life products, premiums are recognized as revenue when due from policyholders. |
Investments | Investments Overview The Company’s investments in fixed maturities include bonds, structured securities, redeemable preferred stock and commercial paper. Most of these investments are classified as AFS and are carried at fair value, net of ACL. The after-tax difference between fair value and cost or amortized cost is reflected in stockholder's equity as a component of AOCI, after adjustments for the effect of VOBA and reserve adjustments. Equity securities are measured at fair value with any changes in valuation reported in net income. Mortgage loans are recorded at the outstanding principal balance adjusted for amortization of premiums or discounts, net of ACL. Policy loans are carried at outstanding balance. Limited partnerships and other alternative investments are reported at their carrying value and are primarily accounted for under the equity method with the Company’s share of earnings included in net investment income. Recognition of income related to limited partnerships and other alternative investments accounted for under the equity method is delayed due to the availability of the related financial information, as private equity and other funds are generally on a three-month lag and hedge funds generally on a one-month lag. Accordingly, income for the year ended December 31, 2022 (Successor Company), the period of July 1, 2021 to December 31, 2021 (Successor Company), the period of January 1, 2021 to June 30, 2021 (Predecessor Company), and the year ended December 31, 2020 (Predecessor Company), may not include the full impact of current year changes in valuation of the underlying assets and liabilities of the funds, which are generally obtained from the limited partnerships and other alternative investments’ general partners. Other investments consist of derivative instruments which are carried at fair value and real estate acquired in satisfaction of debt. Short-term investments, including cash equivalents, are carried at amortized cost, which approximates fair value. Fair Value Option ("FVO") The Company has elected the FVO for rated feeder fund investments, where a single entity issues both debt securities and equity interests and the Company owns both the debt security and equity interest portions of the investment. The Company has elected the FVO for these investments to reflect changes in fair value in earnings and to align the timing of the fair value measurement for its multiple investments in that single entity. Credit Losses An ACL is recognized as an estimate of credit losses expected over the life of financial instruments, such as mortgage loans, reinsurance recoverables and off-balance sheet credit exposures that the Company cannot unconditionally cancel. The measurement of the expected credit loss estimate is based on historical loss data, current conditions, and reasonable and supportable forecasts. Credit losses on fixed maturities, AFS carried at fair value are measured through an other-than-temporary impairment ("OTTI"); however, losses are recognized through the ACL and no longer as an adjustment to the amortized cost. Recoveries of OTTI on fixed maturities, AFS are recognized as reversals of the ACL recognized through net realized capital gains and losses and no longer accreted as net investment income through an adjustment to the investment yield. Additionally, purchased financial assets with a more-than-insignificant amount of credit deterioration since original issuance establishes an ACL at acquisition, which is recorded with the purchase price to establish the initial amortized cost of the investment. Net Realized Capital Gains and Losses Net realized capital gains and losses from investment sales are reported as a component of revenues and are determined on a specific identification basis. Net realized capital gains and losses also result from fair value changes in equity securities, derivatives contracts (both freestanding and embedded) that do not qualify, or are not designated, as a hedge for accounting purposes, and certain investments where the FVO has been elected. The entire change in fair value of the FVO investment includes the components related to dividends and interest income. Impairments and changes in the ACL on fixed maturities, AFS; mortgage loans; and reinsurance recoverables are recognized as net realized capital losses in accordance with the Company’s impairment and ACL policies as discussed in Note 3 - Investments of Notes to Consolidated Financial Statements. Foreign currency transaction remeasurements are also included in net realized capital gains and losses. Interest income from fixed maturities, FVO is recognized when earned on the constant effective yield method based on estimated timing of cash flows. Net Investment Income Interest income from fixed maturities, AFS and mortgage loans is recognized when earned on the constant effective yield method based on estimated timing of cash flows. The amortization of premium and accretion of discount for fixed maturities also takes into consideration call and maturity dates that produce the lowest yield. For securitized financial assets subject to prepayment risk, yields are recalculated and adjusted periodically to reflect historical and/or estimated future prepayments using the retrospective method; however, if these investments have previously recognized an ACL and for certain other asset-backed securities, any yield adjustments are made using the prospective method. Prepayment fees and make-whole payments on fixed maturities and mortgage loans are recorded in net investment income when earned. For equity securities, dividends are recognized as investment income on the ex-dividend date. Limited partnerships and other alternative investments primarily use the equity method of accounting to recognize the Company’s share of earnings. Expected credit losses on fixed maturities, AFS are recorded through an ACL. The Company’s non-income producing investments were not material for the year ended December 31, 2022 (Successor Company), the period of July 1, 2021 to December 31, 2021 (Successor Company), the period of January 1, 2021 to June 30, 2021 (Predecessor Company), and the year ended December 31, 2020 (Predecessor Company). In addition, net investment income includes a portion of the change in funds withheld at interest, as a result of the change in the risk-free rate on the host contract. |
Derivative Instruments | Derivative Instruments Overview The Company utilizes a variety of over-the-counter ("OTC") transactions, OTC cleared through central clearing houses ("OTC-cleared"), and exchange traded derivative instruments as part of its overall risk management strategy as well as to enter into replication transactions. The types of instruments may include swaps, caps, floors, forwards, futures and options to achieve one of four Company-approved objectives: • to hedge risk arising from interest rate, equity market, commodity market, credit spread and issuer default, price or currency exchange rate risk or volatility; • to manage liquidity; • to control transaction costs; • to enter into synthetic replication transactions. Interest rate and credit default swaps involve the periodic exchange of cash flows with other parties, at specified intervals, calculated using agreed upon rates or other financial variables and notional principal amounts. Generally, little to no cash or principal payments are exchanged at the inception of the contract. Typically, at the time a swap is entered into, the cash flow streams exchanged by the counterparties are equal in value. Interest rate cap and floor contracts entitle the purchaser to receive from the issuer at specified dates, the amount, if any, by which a specified market rate exceeds the cap strike interest rate or falls below the floor strike interest rate, applied to a notional principal amount. A premium payment determined at inception is made by the purchaser of the contract and no principal payments are exchanged. Forward contracts are customized commitments that specify a rate of interest or currency exchange rate to be paid or received on an obligation beginning on a future start date and are typically settled in cash. Financial futures are standardized commitments to either purchase or sell designated financial instruments, at a future date, for a specified price and may be settled in cash or through delivery of the underlying instrument. Futures contracts trade on organized exchanges. Margin requirements for futures are met by pledging securities or cash, and changes in the futures’ contract values are settled daily in cash. Option contracts grant the purchaser, for a premium payment, the right to either purchase from or sell to the issuer a financial instrument at a specified price, within a specified period or on a stated date. The contracts may reference commodities, which grant the purchaser the right to either purchase from or sell to the issuer commodities at a specified price, within a specified period or on a stated date. Option contracts are typically settled in cash. Foreign currency swaps exchange an initial principal amount in two currencies, agreeing to re-exchange the currencies at a future date, at an agreed upon exchange rate. There may also be a periodic exchange of payments at specified intervals calculated using the agreed upon rates and exchanged principal amounts. The Company’s derivative transactions conducted in insurance company subsidiaries are used in strategies permitted under the derivative use plans required by the State of Connecticut and the State of New York insurance departments. Accounting and Financial Statement Presentation of Derivative Instruments and Hedging Activities Derivative instruments are recognized on the Consolidated Balance Sheets at fair value and are reported in other investments and other liabilities. For balance sheet presentation purposes, the Company has elected to offset the fair value amounts, income accruals, and related cash collateral receivables and payables of OTC derivative instruments executed in a legal entity and with the same counterparty or under a master netting agreement, which provides the Company with the legal right of offset. The Company clears certain interest rate swap and credit default swap derivative transactions through central clearing houses. OTC-cleared derivatives require initial collateral at the inception of the trade in the form of cash or highly liquid securities, such as U.S. Treasuries and government agency investments. Central clearing houses also require additional cash as variation margin based on daily market value movements. For information on collateral, see the derivative collateral arrangements section in Note 4 - Derivatives of Notes to Consolidated Financial Statements. In addition, OTC-cleared transactions include price alignment amounts either received or paid on the variation margin, which are reflected in realized capital gains and losses or, if characterized as interest, in net investment income. On the date the derivative contract is entered into, the Company designates the derivative as (1) a hedge of the variability in cash flows of a forecasted transaction or of amounts to be received or paid related to a recognized asset or liability (“cash flow” hedge), (2) a hedge of a net investment in a foreign operation (“net investment” hedge) or (3) held for other investment and/or risk management purposes, which primarily involve managing asset or liability related risks and do not qualify for hedge accounting. Cash Flow Hedges - Changes in the fair value of a derivative that is designated and qualifies as a cash flow hedge, including foreign-currency cash flow hedges, are recorded in AOCI and are reclassified into earnings when the variability of the cash flow of the hedged item impacts earnings. Gains and losses on derivative contracts that are reclassified from AOCI to current period earnings are included in the line item in the Consolidated Statements of Operations in which the cash flows of the hedged item are recorded. Periodic derivative net coupon settlements are recorded in the line item of the Consolidated Statements of Operations in which the cash flows of the hedged item are recorded. Cash flows from cash flow hedges are presented in the same category as the cash flows from the items being hedged on the Consolidated Statements of Cash Flows. Other Investment and/or Risk Management Activities - The Company’s other investment and/or risk management activities primarily relate to strategies used to reduce economic risk or replicate permitted investments and do not receive hedge accounting treatment. Changes in the fair value, including periodic derivative net coupon settlements, of derivative instruments held for other investment and/or risk management purposes are reported in current period earnings as net realized capital gains and losses. Hedge Documentation and Effectiveness Testing To qualify for hedge accounting treatment, a derivative must be highly effective in mitigating the designated changes in fair value or cash flow of the hedged item. At hedge inception, the Company formally documents all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking each hedge transaction. The documentation process includes linking derivatives that are designated as fair value, cash flow, or net investment hedges to specific assets or liabilities on the balance sheet or to specific forecasted transactions and defining the effectiveness testing methods to be used. The Company also formally assesses both at the hedge’s inception and ongoing on a quarterly basis, whether the derivatives that are used in hedging transactions have been and are expected to continue to be highly effective in offsetting changes in fair values, cash flows or net investment in foreign operations of hedged items. Hedge effectiveness is assessed primarily using quantitative methods as well as using qualitative methods. Quantitative methods include regression or other statistical analysis of changes in fair value or cash flows associated with the hedge relationship. Qualitative methods may include comparison of critical terms of the derivative to the hedged item. Discontinuance of Hedge Accounting The Company discontinues hedge accounting prospectively when (1) it is determined that the qualifying criteria are no longer met; (2) the derivative is no longer designated as a hedging instrument; or (3) the derivative expires or is sold, terminated or exercised. When cash flow hedge accounting is discontinued because the Company becomes aware that it is not probable that the forecasted transaction will occur, the derivative continues to be carried on the balance sheet at its fair value, and gains and losses that were accumulated in AOCI are recognized immediately in earnings. In other situations in which hedge accounting is discontinued, including those where the derivative is sold, terminated or exercised, amounts previously deferred in AOCI are reclassified into earnings when earnings are impacted by the hedged item. Embedded Derivatives The Company purchases investments and has previously issued and assumed via reinsurance financial products that contain embedded derivative instruments. When it is determined that (1) the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract and (2) a separate instrument with the same terms would qualify as a derivative instrument, the embedded derivative is bifurcated from the host for measurement purposes. The embedded derivative, which is reported with the host instrument on the Consolidated Balance Sheets, is carried at fair value with changes in fair value reported in net realized capital gains and losses. Credit Risk Credit risk is defined as the risk of financial loss due to uncertainty of an obligor’s or counterparty’s ability or willingness to meet its obligations in accordance with agreed upon terms. Credit exposures are measured using the market value of the derivatives, resulting in amounts owed to the Company by its counterparties or potential payment obligations from the Company to its counterparties. The Company generally requires that OTC derivative contracts, other than certain forward contracts, be governed by International Swaps and Derivatives Association ("ISDA") agreements which are structured by legal entity and by counterparty and permit right of offset. Some agreements require daily collateral settlement based upon agreed upon thresholds. For purposes of daily derivative collateral maintenance, credit exposures are generally quantified based on the prior business day’s market value and collateral is pledged to and held by, or on behalf of, the Company to the extent the current value of the derivatives exceed the contractual thresholds. For the Company’s domestic derivative programs, the maximum uncollateralized threshold for a derivative counterparty for a single legal entity is $7. The Company also minimizes the credit risk of derivative instruments by entering into transactions with high quality counterparties primarily rated A or better, which are monitored and evaluated by the Company’s risk management team and reviewed by senior management. OTC-cleared derivatives are governed by clearing house rules. Transactions cleared through a central clearing house reduce risk due to their ability to require daily variation margin and act as an independent valuation source. In addition, the Company monitors counterparty credit exposure on a monthly basis to ensure compliance with Company policies and statutory limitations. Derivative Instruments The Company utilizes a variety of OTC, OTC-cleared and exchange traded derivative instruments as a part of its overall risk management strategy as well as to enter into replication transactions. Derivative instruments are used to manage risk associated with interest rate, equity market, credit spread, issuer default, price, and currency exchange rate risk or volatility. Replication transactions are used as an economical means to synthetically replicate the characteristics and performance of assets that are permissible investments under the Company’s investment policies. The Company also may enter into and has previously issued financial instruments and products that either are accounted for as freestanding derivatives, such as certain reinsurance contracts, or as embedded derivative instruments, such as certain GMWB riders included with certain variable annuity products. |
Cash | Cash Cash represents cash on hand and demand deposits with banks or other financial institutions, as well as money market funds. |
Reinsurance | Reinsurance The Company cedes to affiliated and unaffiliated insurers to enable the Company to manage capital and risk exposure. The Company also assumes from unaffiliated insurers to provide our counterparties with risk management solutions. The Company's historical reinsurance cessions provided a level of risk mitigation desired by prior ownership. The Company's current reinsurance assumptions and internal retrocessions provide strategic business growth opportunities. In ceding and assuming risks, the Company may use various types of reinsurance including coinsurance, modified coinsurance, coinsurance with funds withheld arrangements, and yearly renewable term. Failure of reinsurers to honor their obligations could result in losses to the Company. Ceded reinsurance arrangements do not discharge the Company as the primary insurer, except for instances where the primary policy or policies have been novated. Premiums and benefits and losses reflect the net effects of ceded and assumed reinsurance transactions. Included in other assets are prepaid reinsurance premiums, which represent the portion of premiums ceded to reinsurers applicable to the unexpired terms of the reinsurance agreements. Included in reinsurance recoverables are balances due from reinsurance companies for paid and unpaid losses and are presented net of an ACL which is based on the expectation of lifetime credit loss. Reinsurance accounting is followed for ceded and assumed transactions that provide indemnification against loss or liability relating to insurance risk (risk transfer). To meet risk transfer requirements, a reinsurance agreement must include insurance risk, consisting of underwriting, investment, and timing risk, and a reasonable possibility of a significant loss to the reinsurer. If the ceded and assumed transactions do not meet risk transfer requirements, the Company accounts for these transactions as financing transactions. The deferred gain or acquisition cost related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies and is primarily amortized on a constant-level basis. Under coinsurance arrangements, reserves and investment assets are transferred from the ceding insurer to the reinsurer. In certain arrangements, the reinsurer will hold the assets supporting the reserves in a trust for the benefit of the ceding insurer. Under modified coinsurance arrangements, both the ceded reserves and the investment assets that support the reserves are retained by the cedant and profit and loss with respect to the obligations and investment returns flow through periodic net settlements. Under coinsurance with funds withheld arrangements, ceded reserves are transferred to the reinsurer, however, investment assets that support the reserves are retained by the cedant, and profit and loss with respect to only the investment returns flow through periodic net settlements. Both modified coinsurance and coinsurance with funds withheld arrangements require the cedant to establish a mechanism which legally segregates the underlying assets. The Company has the right of offset on general account assets and liabilities reinsured on a modified coinsurance and coinsurance with funds withheld basis, but have elected to present balances due to and due from reinsurance counterparties on a gross basis, within reinsurance recoverables and funds withheld liability on the Consolidated Balance Sheets. Modified coinsurance of assumed separate accounts accounted for under reinsurance accounting is presented on a net basis on the Consolidated Balance Sheets. As a result of the net presentation of the reinsured separate account assets and liabilities, we have revenue recorded from the reinsurance separate accounts as fee income, but not an associated asset or liability on the Consolidated Balance Sheets. A funds withheld liability is established which represents the fair value of investment assets segregated under ceded modified coinsurance or coinsurance with funds withheld reinsurance arrangements. The funds withheld liability is comprised of a host contract and an embedded derivative. For ceded reinsurance agreements, the cedant has an obligation to pay the total return on the assets supporting the funds withheld liability. Interest accrues at a risk-free rate on the host contract and is recorded as net investment income in the Consolidated Statements of Operations. The embedded derivative is similar to a total return swap on the income generated by the underlying assets held by the cedant. The change in the embedded derivative is recorded in net realized capital gains (losses). The Company evaluates the financial condition of its reinsurers and concentrations of credit risk. Reinsurance is placed with reinsurers that meet strict financial criteria established by the Company. |
Value of Business Acquired | Value of Business Acquired VOBA represents the estimated value assigned to the right to receive future gross profits from cash flows and earnings of acquired insurance and investment contracts as of the date of the acquisition. It is based on the actuarially estimated present value of future cash flows from the acquired insurance and investment contracts in-force as of the date of the acquisition. The principal assumptions used in estimating VOBA include equity market returns, mortality, persistency, expenses, and discount rates, in addition to other factors that the Company expects to experience in future years. Actual experience on the acquired contracts may vary from these projections and the recovery of VOBA is dependent upon the future profitability of the related business. For certain transactions, the fair value of acquired obligations of the Company exceed the book value of assumed in-force policy liabilities resulting in additional insurance liabilities. In pushdown accounting, these liabilities were increased to fair value, which is presented separately from VOBA as an additional insurance liability included in other policyholder funds and benefits payable on the Consolidated Balance Sheets. The Company amortizes VOBA over EGPs and it is reviewed for recoverability quarterly. The Company also uses the present value of EGPs to determine reserves for universal life type contracts (including VA) with death or other insurance benefits such as guaranteed minimum death benefits, life-contingent guaranteed minimum withdrawal and universal life insurance secondary guarantee benefits. These benefits are accounted for and collectively referred to as death and other insurance benefit reserves and are held in addition to the account value liability representing policyholder funds. For most life insurance product contracts, including variable annuities, the Company estimates gross profits over 20 years as EGPs emerging subsequent to that time frame are immaterial. Future gross profits are projected over the estimated lives of the underlying contracts, based on future account value projections for variable annuity products. The projection of future account values requires the use of certain assumptions including: separate account returns; separate account fund mix; fees assessed against the contract holder’s account balance; f ull and partial surrender rates; interest credited; mortality; and annuitization rates. Changes in these assumptions and changes to other assumptions such as expenses and hedging costs cause EGPs to fluctuate, which impacts earnings. In the third quarter of 2022, the Company completed a comprehensive policyholder behavior assumption study which resulted in a non-market related after-tax charge and incorporated the results of that study into its projection of future gross profits. Additionally, throughout the year, the Company evaluates various aspects of policyholder behavior and will revise its policyholder behavior assumptions if credible emerging data indicates that changes are warranted. Upon completion of an annual assumption study or evaluation of credible new information, the Company will revise its assumptions to reflect its current best estimate. These assumption revisions will change the projected account values and the related EGPs in the VOBA models, as well as EGPs used in the death and other insurance benefit reserving models. All assumption changes that affect the estimate of future EGPs including the update of current account values and policyholder behavior assumptions are considered an Unlock in the period of revision. An Unlock adjusts the VOBA, death and other insurance benefit reserve balances on the Consolidated Balance Sheets with an offsetting benefit or charge on the Consolidated Statements of Operations in the period of the revision. An Unlock revises EGPs to reflect the Company's current best estimate assumptions. The Company also tests the aggregate recoverability of VOBA by comparing the existing balance to the present value of future EGPs. An Unlock that results in an after-tax benefit generally occurs as a result of actual experience or future expectations of product profitability being favorable compared to previous estimates. An Unlock that results in an after-tax charge generally occurs as a result of actual experience or future expectations of product profitability being unfavorable compared to previous estimates. Policyholders or their beneficiaries may make modifications to existing contracts. If the new modification results in a substantially changed replacement contract, the existing VOBA is written off through income. If the modified contract is not substantially changed, the existing VOBA continues to be amortized and incremental costs are expensed in the period incurred. |
Income Taxes | Income Taxes The Company recognizes taxes payable or refundable for the current year and deferred taxes for the tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years the temporary differences are expected to reverse. A deferred tax provision is recorded for the tax effects of differences between the Company's current taxable income and its income before tax under U.S. GAAP in the Consolidated Statements of Operations. For deferred tax assets, the Company records a valuation allowance that is adequate to reduce the total deferred tax asset to an amount that will more likely than not be realized. |
Separate Accounts | Separate Accounts The Company records the variable account value portion of variable annuities, variable life insurance products and individual, institutional, and governmental investment contracts within separate accounts. Separate account assets are reported at fair value and separate account liabilities are reported at amounts consistent with separate account assets. Investment income and gains and losses from those separate account assets accrue directly to the policyholder, who assumes the related investment risk, and are offset by the change in the related liability. The Company earns fee income for investment management, certain administrative services and mortality and expense risks. |
Reserve for Future Policy Benefits | Reserve for Future Policy Benefits Reserve for Future Policy Benefits on Universal Life-type Contracts Certain contracts classified as universal life-type include death and other insurance benefit features. These features include guaranteed minimum death benefit ("GMDB") and the life-contingent portion of guaranteed minimum withdrawal benefit ("GMWB") riders offered with variable annuity contracts, including assumed variable annuity contracts, secondary guarantee benefits offered with universal life insurance contracts, as well as GLWB riders and guaranteed annuitization benefits offered by assumed variable annuity and FIA contracts. GMDB riders on variable annuities provide a death benefit during the accumulation phase that is generally equal to the greater of (a) the contract value at death or (b) premium payments less any prior withdrawals and may include adjustments that increase the benefit, such as for maximum anniversary value ("MAV"). For the Company's products with life-contingent GMWB riders, the withdrawal benefit can exceed the guaranteed remaining balance ("GRB"), which is generally equal to premiums less withdrawals. In addition to recording an account value liability that represents policyholder funds, the Company records a death and other insurance benefit liability for GMDBs, the life-contingent portion of GMWBs and the universal life insurance secondary guarantees. Universal life insurance secondary guarantee benefits ensure that 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. GLWBs on FIA contracts allow guaranteed lifetime withdrawals even if account value is otherwise insufficient. Certain FIA contracts contain a second notional account value which provides additional annuitization benefits. This death and other insurance benefit liability is reported in reserve for future policy benefits on the Company’s Consolidated Balance Sheets. Changes in the death and other insurance benefit reserves are recorded in benefits and losses in the Company’s Consolidated Statements of Operations. The death and other insurance benefit liability is determined by estimating the expected present value of the benefits in excess of the policyholder’s expected account value in proportion to the present value of total expected assessments and investment margin. Total expected assessments are the aggregate of all contract charges, including those for administration, mortality, expense, and surrender. The liability is accrued as actual assessments are earned. The expected present value of benefits and assessments are generally derived from a set of stochastic scenarios that have been calibrated to assumed market rates of return and assumptions including volatility, discount rates, lapse rates and mortality experience. Consistent with the Company’s policy on the Unlock, the Company regularly evaluates estimates used and adjusts the liability, with a related charge or credit to benefits and losses. For further information on the Unlock, see the Value of Business Acquired accounting policy section within this footnote. The Company reinsures a majority of its FIA, a portion of its in-force GMDB and GMWB risks, and all of its universal life insurance secondary guarantees. Reserve for Future Policy Benefits on Traditional Annuity and Other Contracts Traditional annuities recorded within the reserve for future policy benefits primarily include life-contingent contracts in the payout phase such as structured settlements and terminal funding agreements. Other contracts within the reserve for policyholder benefits include whole life and guaranteed term life insurance contracts. The reserve for future policy benefits is calculated using standard actuarial methods considering the present value of future benefits and related expenses to be paid less the present value of the portion of future premiums required using assumptions “locked in” at the time the policies were issued, including discount rate, withdrawal, mortality and expense assumptions deemed appropriate at the issue date. Future policy benefits are computed at amounts that, with additions from any estimated premiums to be received and with interest on such reserves compounded annually at assumed rates, are expected to be sufficient to meet the Company’s policy obligations at their maturities or in the event of an insured’s death. While assumptions are locked in upon issuance of new contracts and annuitizations of existing contracts, significant changes in experience or assumptions may require the Company to establish premium deficiency reserves. Premium deficiency reserves, if any, are established based on current assumptions without considering a provision for adverse deviation. Changes in or deviations from the assumptions used can significantly affect the Company’s reserve levels and results from operations. The Company uses reinsurance for a portion of its fixed and payout annuity businesses and its life insurance business. Other Policyholder Funds and Benefits Payable |
Fair Value of Financial Instruments | The Company carries certain financial assets and liabilities at estimated fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants. Our fair value framework includes a hierarchy that gives the highest priority to the use of quoted prices in active markets, followed by the use of market observable inputs, followed by the use of unobservable inputs. The fair value hierarchy levels are as follows: Level 1 Fair values based primarily on unadjusted quoted prices for identical assets or liabilities, in active markets that the Company has the ability to access at the measurement date. Level 2 Fair values primarily based on observable inputs, other than quoted prices included in Level 1, or based on prices for similar assets and liabilities. Level 3 Fair values derived when one or more of the significant inputs are unobservable (including assumptions about risk). With little or no observable market, the determination of fair values uses considerable judgment and represents the Company’s best estimate of an amount that could be realized in a market exchange for the asset or liability. Also included are securities that are traded within illiquid markets and/or priced by independent brokers. Valuation Techniques The Company generally determines fair values using valuation techniques that use prices, rates, and other relevant information evident from market transactions involving identical or similar instruments. Valuation techniques also include, where appropriate, estimates of future cash flows that are converted into a single discounted amount using current market expectations. The Company uses a "waterfall" approach comprised of the following pricing sources and techniques, which are listed in priority order: • Quoted prices, unadjusted, for identical assets or liabilities in active markets, which are classified as Level 1. • Prices from third-party pricing services, which primarily utilize a combination of techniques. These services utilize recently reported trades of identical, similar, or benchmark securities making adjustments for market observable inputs available through the reporting date. If there are no recently reported trades, they may use a discounted cash flow technique to develop a price using expected cash flows based upon the anticipated future performance of the underlying collateral discounted at an estimated market rate. Both techniques develop prices that consider the time value of future cash flows and provide a margin for risk, including liquidity and credit risk. Most prices provided by third-party pricing services are classified as Level 2 because the inputs used in pricing the securities are observable. However, some securities that are less liquid or trade less actively are classified as Level 3. Additionally, certain long-dated securities, such as municipal securities and bank loans, include benchmark interest rate or credit spread assumptions that are not observable in the marketplace and are thus classified as Level 3. • Internal matrix pricing is a valuation process internally developed for private placement securities for which the Company is unable to obtain a price from a third-party pricing service. Internal pricing matrices determine credit spreads that, when combined with risk-free rates, are applied to contractual cash flows to develop a price. The Company develops credit spreads using market based data for public securities adjusted for credit spread differentials between public and private securities, which are obtained from a survey of multiple private placement brokers. The market-based reference credit spread considers the issuer’s sector, financial strength, and term to maturity, using an independent public security index, while the credit spread differential considers the non-public nature of the security. Securities priced using internal matrix pricing are classified as Level 2 because the significant inputs are observable or can be corroborated with observable data. • Independent broker quotes, which are typically non-binding use inputs that can be difficult to corroborate with observable market based data. Brokers may use present value techniques using assumptions specific to the security types, or they may use recent transactions of similar securities. Due to the lack of transparency in the process that brokers use to develop prices, valuations that are based on independent broker quotes are classified as Level 3. The fair value of freestanding derivative instruments is determined primarily using a discounted cash flow model or option model technique and incorporates counterparty credit risk. In some cases, quoted market prices for exchange-traded and OTC cleared derivatives may be used and in other cases independent broker quotes may be used. The pricing valuation models primarily use inputs that are observable in the market or can be corroborated by observable market data. The valuation of certain derivatives may include significant inputs that are unobservable, such as volatility levels, and reflect the Company’s view of what other market participants would use when pricing such instruments. Unobservable market data is used in the valuation of customized derivatives that are used to hedge certain GMWB variable annuity riders. See the section “GMWB and FIA Embedded, Customized, and Reinsurance Derivatives” below for further discussion of the valuation model used to value these customized derivatives. Valuation Inputs Quoted prices for identical assets in active markets are considered Level 1 and consist of on-the-run U.S. Treasuries, money market funds, exchange-traded equity securities, open-ended mutual funds, certain short-term investments, and exchange traded futures and option contracts. Valuation Inputs Used in Levels 2 and 3 Measurements for Securities and Freestanding Derivatives Level 2 Level 3 Fixed Maturity Investments Structured securities (includes ABS, CLOs, CMBS and RMBS) • Benchmark yields and spreads Other inputs for ABS, CLOs, and RMBS: • Independent broker quotes Other inputs for less liquid securities or those that trade less actively, including subprime RMBS: Corporate • Benchmark yields and spreads Other inputs for investment grade privately placed securities that utilize internal matrix pricing: • Independent broker quotes Other inputs for below investment grade privately placed securities and private bank loans: U.S Treasuries, Municipals, and Foreign government/government agencies • Benchmark yields and spreads • Credit spreads beyond observable curve Equity Securities • Quoted prices in markets that are not active • For privately traded equity securities, internal discounted cash flow models utilizing earnings multiples or other cash flow assumptions that are not observable Limited Partnerships and Other Alternative Investments, FVO Not applicable • Prices of privately traded securities Short-term Investments • Benchmark yields and spreads • Independent broker quotes Derivatives Credit derivatives • Swap yield curve Not applicable Foreign exchange derivatives • Swap yield curve Not applicable Interest rate derivatives • Swap yield curve • Independent broker quotes GMWB and FIA Embedded, Customized and Reinsurance Derivatives GMWB Embedded Derivatives The Company formerly offered certain variable annuity products with GMWB riders that provide the policyholder with a GRB which is generally equal to premiums less withdrawals. If the policyholder’s account value is reduced to a specified level through a combination of market declines and withdrawals but the GRB still has value, the Company is obligated to continue to make annuity payments to the policyholder until the GRB is exhausted. When payments of the GRB are not life-contingent, the GMWB represents an embedded derivative carried at fair value reported in other policyholder funds and benefits payable on the Consolidated Balance Sheets with changes in fair value reported in net realized capital gains (losses). FIA Embedded Derivative The Company assumed through reinsurance FIA contracts that provide the policyholder with benefits that depend on the performance of market indices. Benefits in excess of contract guarantees represent an embedded derivative carried at fair value and reported in other policyholder funds and benefits payable on the Consolidated Balance Sheets with changes in fair value reported in net realized capital gains (losses). Freestanding Customized Derivatives The Company previously held freestanding customized derivative contracts to provide protection from certain capital markets risks for the remaining term of specified blocks of GMWB riders written on a direct basis. These customized derivatives are based on policyholder behavior assumptions specified at the inception of the derivative contracts. The Company retained the risk for differences between assumed and actual policyholder behavior and between the performance of the actively managed funds underlying the separate accounts and their respective indices. These derivatives were reported on the Consolidated Balance Sheets within other investments or other liabilities, as appropriate, after considering the impact of master netting agreements. GMWB Reinsurance Derivative The Company has reinsurance arrangements with affiliated and unaffiliated reinsurers in place to transfer a portion of its risk of loss due to GMWB. Certain of these arrangements are recognized as derivatives carried at fair value and reported in reinsurance recoverables on the Consolidated Balance Sheets. Changes in the fair value of the reinsurance agreements are reported in net realized capital gains (losses). Valuation Techniques Fair values for FIA and GMWB embedded derivatives, freestanding customized derivatives and reinsurance derivatives are classified as Level 3 in the fair value hierarchy and are calculated using internally developed models that utilize significant unobservable inputs because active, observable markets do not exist for these items. In valuing the GMWB embedded derivative, the Company attributes to the derivative a portion of the expected fees to be collected over the expected life of the contract from the contract holder equal to the present value of future GMWB claims. The excess of fees collected from the contract holder in the current period over the portion of fees attributed to the embedded derivative in the current period are associated with the host variable annuity contract and reported in fee income. Valuation Inputs The fair value for each of the non-life contingent GMWBs, FIA embedded derivative, the freestanding customized derivatives and the GMWB reinsurance derivative is calculated as an aggregation of the following components: Best Estimate Benefits; Credit Standing Adjustment; and Margins. The Company believes the aggregation of these components results in an amount that a market participant in an active liquid market would require, if such a market existed, to assume the risks associated with the guaranteed minimum benefits and the related reinsurance and customized derivatives. Each component described in the following discussion is unobservable in the marketplace and requires subjectivity by the Company in determining its value. Best Estimate Benefits The Best Estimate Benefits are calculated based on actuarial and capital market assumptions related to projected cash flows, including the present value of benefits and related contract charges, over the lives of the contracts, incorporating unobservable inputs including expectations concerning policyholder behavior. Credit Standing Adjustment The credit standing adjustment is an estimate of the adjustment to the fair value that market participants would require in determining fair value to reflect the risk that GMWB benefit obligations or the GMWB reinsurance recoverables will not be fulfilled. The Company incorporates a blend of estimates of peer company and reinsurer bond spreads and credit default spreads from capital markets, adjusted for market recoverability. Margins The behavior risk margin adds a margin that market participants would require, in determining fair value, for the risk that the Company’s assumptions about policyholder behavior could differ from actual experience. The behavior risk margin is calculated by taking the difference between adverse policyholder behavior assumptions and best estimate assumptions. Valuation Inputs Used in Levels 2 and 3 Measurements for GMWB and FIA Embedded, Customized and Reinsurance Derivatives Level 2 Level 3 • Risk-free rates as represented by the Eurodollar futures, LIBOR deposits and swap rates to derive forward curve rates • Correlations of 10 years of observed historical returns across underlying well-known market indices • Correlations of historical index returns compared to separate account fund returns • Equity index levels • Market implied equity volatility assumptions Assumptions about policyholder behavior, including: |
Derivatives, Methods of Accounting | Strategies that Qualify for Hedge Accounting Some of the Company's derivatives satisfy hedge accounting requirements as outlined in Note 1 - Basis of Presentation and Significant Accounting Policies of these financial statements. Typically, these hedging instruments include interest rate swaps and, to a lesser extent, foreign currency swaps where the terms or expected cash flows of the hedged item closely match the terms of the swap. The interest rate swaps are typically used to manage interest rate duration of certain fixed maturity securities or liability contracts. As a result of pushdown accounting, derivative instruments that previously qualified for hedge accounting were de-designated and recorded at fair value through adjustments to additional paid-in capital at the acquisition date. The hedge strategies by hedge accounting designation include: Cash Flow Hedges Interest rate swaps are predominantly used to manage portfolio duration and better match cash receipts from assets with cash disbursements required to fund liabilities. These derivatives primarily convert interest receipts on floating-rate fixed maturity securities to fixed rates. Foreign currency swaps are used to convert foreign currency-denominated cash flows related to certain investment receipts and liability payments to U.S. dollars in order to reduce cash flow fluctuations due to changes in currency rates. Non-Qualifying Strategies Derivative relationships that do not qualify for hedge accounting (“non-qualifying strategies”) primarily include the hedge program for the Company's variable annuity products as well as the hedging and replication strategies that utilize credit default swaps. In addition, hedges of interest rate, foreign currency and equity risk of certain fixed maturities, equities and liabilities do not qualify for hedge accounting. The non-qualifying strategies include: Interest Rate Swaps, Swaptions and Futures The Company uses interest rate swaps, swaptions and futures to manage interest rate duration between assets and liabilities in certain investment portfolios. In addition, the Company enters into interest rate swaps to terminate existing swaps, thereby offsetting the changes in value of the original swap. As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the notional amount of interest rate swaps in offsetting relationships was $276 and $506, respectively. Foreign Currency Swaps and Forwards The Company enters into foreign currency swaps to convert the foreign currency exposures of certain foreign currency-denominated fixed maturity investments to U.S. dollars. The Company also enters into foreign currency forwards to hedge non-U.S. dollar denominated cash. Credit Contracts Credit default swaps are used to purchase credit protection on an individual entity or referenced index to economically hedge against default risk and credit-related changes in the value of fixed maturity securities. Credit default swaps are also used to assume credit risk related to an individual entity or referenced index as a part of replication transactions. These contracts require the Company to pay or receive a periodic fee in exchange for compensation from the counterparty or the Company should the referenced security issuers experience a credit event, as defined in the contract. In addition, the Company enters into credit default swaps to terminate existing credit default swaps, thereby offsetting the changes in value of the original swap going forward. Equity Index Swaps and Options The Company enters into equity index options to hedge the impact of a decline in the equity markets on the investment portfolio. Macro Hedge Program The Company utilizes equity swaps, options and futures as well as interest rate swaps to provide protection against the statutory tail scenario risk to the Company's statutory surplus arising from higher GMDB claims, as well as lower variable annuity fee revenue. GMWB Derivatives, net The Company formerly offered certain variable annuity products with GMWB riders. The GMWB product is a bifurcated embedded derivative (“GMWB product derivatives”) that has a notional value equal to the GRB. The Company uses reinsurance contracts to transfer a portion of its risk of loss due to GMWB. The reinsurance contracts covering GMWB (“GMWB reinsurance contracts”) are accounted for as freestanding derivatives with a notional amount equal to the GRB reinsured. FIA Embedded Derivative The Company has assumed through reinsurance, certain FIA products with index-based crediting that constitutes an embedded derivative. The cedant hedges this risk and provides the benefits of this hedging as part of the reinsurance settlements. |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Pushdown Accounting | The following table represents the final determination of the fair value of the assets acquired and liabilities assumed for the Sixth Street Acquisition: Cash and invested assets $ 19,711 VOBA 565 Deferred income taxes 737 Goodwill 97 Other intangible assets 67 Reinsurance recoverables and other assets [1] 30,481 Separate account assets 112,857 Total assets 164,515 Reserves for future policy benefits 21,122 Other policyholder funds and benefits payable 25,961 Funds withheld liability [1] 1,039 Other liabilities 1,653 Separate account liabilities 112,857 Total liabilities 162,632 Stockholder's equity 1,883 Total liabilities and stockholder's equity $ 164,515 [1] Previously reported table was updated to reflect the gross presentation for modified coinsurance reinsurance transactions. |
Accounting Standards Update and Change in Accounting Principle | Amended Topic Description Adoption Method and Transition Impact Cash flow and discount rate assumptions underlying insurance liabilities For nonparticipating traditional and limited-payment insurance contracts, the Company will evaluate, at least annually in the same fiscal quarter, as to whether an update to cash flow assumptions is needed. The Company will update the cash flows used to measure the LFPB, for both changes in future assumptions and actual experience, at least annually. The updating of cash flows impacts the amount of the deferred profit liability (“DPL”) recorded for limited-payment contracts. The DPL will be adjusted concurrently with any updating of the LFPB. Cash flows are required to be discounted with an upper-medium grade (or low credit risk) fixed-income instrument yield, with the effect of discount rate changes on the liability recorded in other comprehensive income (“OCI”). The discount rate utilized is intended to reflect the duration characteristics of the corresponding insurance liabilities. The Company will obtain yield curves and spreads for a range of tenors to determine spot yields to discount the cash flows of the insurance liabilities as of each valuation date. The Company will adopt the guidance for LFPB, as of the date of the Sixth Street Acquisition. As of the acquisition date, the Company expects there will be a decrease to LFPB (and the associated reinsurance recoverable), which will be offset by a net increase to an additional reserve. This is due to the application of purchase accounting associated with the Sixth Street Acquisition, which employed lower discount rates for the fair value calculations than the required discount rates to value the cash flows on the insurance liabilities under ASU 2018-12. MRB The Company currently offers and assumes certain guarantees and product features on variable annuity and FIA products, which protect the contractholder from other-than-nominal capital market risk and expose the Company to other-than-nominal capital market risk. These MRB features are required to be measured at fair value with changes in fair value recorded in net income, with the exception of the changes in MRB liabilities attributable to a change in an entity’s nonperformance risk, which is required to be recognized in OCI. For products that are reinsured, the portion of the change in MRB attributable to changes in the reinsurer’s nonperformance risk is recognized in income. The Company shall maximize the use of relevant observable information and minimize the use of unobservable information in determining the balance of the MRB upon adoption. The Company will adopt the guidance for MRB using the full retrospective method. As of the acquisition date, the Company expects there to be an increase to the MRB liability (and the associated reinsurance recoverable) and a decrease to VOBA, as a result of the difference between the establishment of the MRB recorded at fair value under ASU 2018-12 and reserves previously recorded for those benefits. Amortization of DAC and other DAC-like balances The Company will amortize DAC and other DAC-like balances on a constant-level basis over the expected term for a group of contracts consistent with the groupings used in estimating the associated LFPB. The constant-level basis for the group approximates a pattern of straight-line amortization at an individual contract level by using a method specific to the underlying product. The amortization rate utilized is calculated at the end of the current reporting period, including actual experience and any assumption updates. The revised amortization rate is applied prospectively from the beginning of the current reporting period. As a result of amortizing DAC and other DAC-like balances on a constant-level basis, the Company does not expect a significant impact upon the adoption of ASU 2018-12. Reporting and Disclosures ASU 2018-12 requires certain enhanced presentation and disclosures including disaggregated rollforwards for LFPB, policyholder account balances, MRB, separate account liabilities, DAC and other DAC-like balances, and information about significant inputs, judgments and methods used in the LFPB measurement. The enhanced disclosures are intended to improve the ability of users of the financial statements to evaluate the timing, amount, and uncertainty of cash flows arising from long-duration contracts. The Company’s implementation efforts and the evaluation of the impacts of the guidance on its consolidated financial statements, as well as its systems, processes, and controls, continue to progress. Given the nature and extent of the required changes to a significant portion of the Company’s operations, the adoption of this guidance is expected to have a material impact on its financial position and results of operations. In addition, there will be a significant increase in required disclosures. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Assets and (liabilities) carried at fair value by hierarchy level | Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of December 31, 2022 (Successor Company) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs Significant Unobservable Inputs (Level 3) Assets Accounted for at Fair Value on a Recurring Basis Fixed maturities, AFS Asset backed securities ("ABS") $ 254 $ — $ 213 $ 41 Collateralized loan obligations ("CLOs") 676 — 567 109 Commercial mortgage-backed securities ("CMBS") 1,514 — 1,237 277 Corporate 10,241 — 9,622 619 Foreign government/government agencies 315 — 311 4 Municipal 1,040 — 1,039 1 Residential mortgage-backed securities ("RMBS") 417 — 400 17 U.S. Treasuries 926 — 926 — Total fixed maturities, AFS 15,383 — 14,315 1,068 Fixed maturities, FVO 331 — 25 306 Equity securities, at fair value 179 — 155 24 Limited partnerships and other alternative investments, FVO 58 — — 58 Derivative assets Foreign exchange derivatives 1 — 1 — Macro hedge program 194 — 39 155 Total derivative assets [1] 195 — 40 155 Short-term investments 1,489 742 610 137 Reinsurance recoverable for FIA options 49 — — 49 Reinsurance recoverable for FIA embedded derivative 288 — — 288 Reinsurance recoverable for GMWB (131) — — (131) Modified coinsurance reinsurance contracts 129 — 129 — Separate account assets [2] 86,122 52,642 33,139 53 Total assets accounted for at fair value on a recurring basis $ 104,092 $ 53,384 $ 48,413 $ 2,007 (Liabilities) Accounted for at Fair Value on a Recurring Basis Other policyholder funds and benefits payable FIA embedded derivative $ (385) $ — $ — $ (385) GMWB embedded derivative 131 — — 131 Total other policyholder funds and benefits payable (254) — — (254) Derivative liabilities Credit derivatives 4 — 4 — Foreign exchange derivatives 14 — 14 — Interest rate derivatives (1) — (1) — Macro hedge program 17 — 24 (7) Total derivative liabilities [3] 34 — 41 (7) Funds withheld on modified coinsurance reinsurance contracts 1,481 — 1,518 (37) Total (liabilities) accounted for at fair value on a recurring basis $ 1,261 $ — $ 1,559 $ (298) Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of December 31, 2021 (Successor Company) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs Significant Unobservable Inputs Assets Accounted for at Fair Value on a Recurring Basis Fixed maturities, AFS ABS $ 258 $ — $ 258 $ — CLOs 944 — 785 159 CMBS 2,335 — 2,059 276 Corporate 13,357 39 12,653 665 Foreign government/government agencies 362 — 362 — Municipal 1,456 — 1,455 1 RMBS 811 — 737 74 U.S. Treasuries 1,448 127 1,321 — Total fixed maturities, AFS 20,971 166 19,630 1,175 Equity securities, at fair value 203 11 171 21 Derivative assets Credit derivatives 2 — 2 — Foreign exchange derivatives 7 — 7 — Interest rate derivatives 18 — 15 3 Macro hedge program 16 — (11) 27 Total derivative assets [1] 43 — 13 30 Short-term investments 1,254 744 435 75 Reinsurance recoverable for GMWB (8) — — (8) Separate account assets [2] 110,021 69,089 40,449 79 Total assets accounted for at fair value on a recurring basis $ 132,484 $ 70,010 $ 60,698 $ 1,372 (Liabilities) Accounted for at Fair Value on a Recurring Basis Other policyholder funds and benefits payable FIA embedded derivative $ (655) $ — $ — $ (655) GMWB embedded derivative 80 $ — $ — $ 80 Total other policyholder funds and benefits payable (575) — — (575) Derivative liabilities Foreign exchange derivatives 2 — 2 — Interest rate derivatives (25) — (22) (3) Macro hedge program (229) — (14) (215) Total derivative liabilities [3] (252) — (34) (218) Funds withheld on modified coinsurance reinsurance contracts 15 — 15 — Total (liabilities) accounted for at fair value on a recurring basis $ (812) $ — $ (19) $ (793) [1] Includes derivative instruments in a net positive fair value position (derivative asset) after consideration of the accrued interest and impact of collateral posting requirements which may be imposed by agreements and applicable law. See footnote 3 to this table for derivative liabilities. [2] Approximately $1.1 billion and $1.6 billion of investment sales receivables, as of December 31, 2022 and 2021 (Successor Company), respectively, are excluded from this disclosure requirement because they are trade receivables in the ordinary course of business where the carrying amount approximates fair value. Included in the total fair value amount are $289 and $404 of investments, as of December 31, 2022 and 2021 (Successor Company), respectively, for which the fair value is estimated using the net asset value per unit as a practical expedient which are excluded from the disclosure requirement to classify amounts in the fair value hierarchy. [3] Includes derivative instruments in a net negative fair value position (derivative liability) after consideration of the accrued interest and impact of collateral posting requirements which may be imposed by agreements and applicable law. |
Fair Value Measurement Inputs and Valuation Techniques | Significant Unobservable Inputs for Level 3 - Securities As of December 31, 2022 (Successor Company) Assets Accounted for at Fair Value on a Recurring Basis Fair Value Predominant Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] CLOs [4] $ 109 Discounted cash flows Spread 55bps 337bps 325bps Decrease CMBS 277 Discounted cash flows Spread (encompasses 419bps 1,001bps 534bps Decrease Corporate [4] 901 Discounted cash flows Spread 71bps 719bps 309bps Decrease RMBS [3] 13 Discounted cash flows Spread [6] 62bps 227bps 138bps Decrease Constant prepayment rate [6] 2% 10% 6% Decrease [5] Constant default rate [6] 1% 4% 2% Decrease Loss severity [6] 10% 65% 25% Decrease As of December 31, 2021 (Successor Company) Assets Accounted for at Fair Value on a Recurring Basis Fair Value Predominant Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] CLOs $ 159 Discounted cash flows Spread 234bps 258bps 257bps Decrease CMBS 276 Discounted cash flows Spread (encompasses 203bps 637bps 303bps Decrease Corporate [4] 623 Discounted cash flows Spread 125bps 1,227bps 278bps Decrease RMBS [3] 65 Discounted cash flows Spread [6] 39bps 229bps 90bps Decrease Constant prepayment rate [6] 4% 16% 8% Decrease [5] Constant default rate [6] 1% 4% 3% Decrease Loss severity [6] —% 100% 64% Decrease [1] The weighted average is determined based on the fair value of the securities. [2] Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table. [3] Excludes securities for which the Company bases fair value on broker quotations. [4] Excludes securities for which the Company bases fair value on broker quotations; however, included are broker-priced lower-rated private placement securities for which the Company receives spread and yield information to corroborate the fair value. Amounts for December 31, 2022 include $306 of fixed maturities, FVO. [5] Decrease for above market rate coupons and increase for below market rate coupons. [6] Generally, a change in the assumption used for the constant default rate would have been accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for constant prepayment rate and would have resulted in wider spreads. The tables below exclude certain securities for which fair values are predominately based on independent broker quotes. Significant Unobservable Inputs for Level 3 - Freestanding Derivatives As of December 31, 2022 (Successor Company) Fair Value Predominant Valuation Technique Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] Macro hedge program [3] Equity options $ 65 Option model Equity volatility 18% 64% 26% Increase Interest rate swaption 97 Option model Interest rate volatility 1% 1% 1% Increase As of December 31, 2021 (Successor Company) Fair Value Predominant Valuation Technique Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of Increase in Input on Fair Value [2] Interest rate derivatives Interest rate swaps $ 3 Discounted cash flows Swap curve beyond 30 years 2% 2% 2% Decrease Interest rate swaptions (3) Option Model Interest rate volatility 1% 1% 1% Increase Macro hedge program [3] Equity options (195) Option model Equity volatility 17% 63% 28% Increase Interest rate swaption 7 Option model Interest rate volatility 1% 1% 1% Increase [1] The weighted average is determined based on the fair value of the securities. [2] Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table. Changes are based on long positions, unless otherwise noted. Changes in fair value will be inversely impacted for short positions. [3] Excludes derivatives for which the Company bases fair value on broker quotations. Significant Unobservable Inputs for Level 3 GMWB Embedded, Customized and Reinsurance Derivatives As of December 31, 2022 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Impact of Increase in Input Withdrawal utilization [2] —% 100% 62% Increase Withdrawal rates [3] 4% 8% 6% Increase Lapse rates [4] —% 40% 3% Decrease [8] Reset elections [5] —% 99% 10% Decrease [8] Equity volatility [6] 18% 28% 23% Increase Credit standing adjustment [7] 0.1% 0.3% 0.3% Decrease As of December 31, 2021 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Impact of Increase in Input Withdrawal utilization [2] —% 100% 62% Increase Withdrawal rates [3] 4% 8% 6% Increase Lapse rates [4] —% 48% 5% Decrease [8] Reset elections [5] —% 99% 8% Decrease [8] Equity volatility [6] 11% 25% 21% Increase Credit standing adjustment [7] —% 0.2% 0.1% Decrease Significant Unobservable Inputs for Level 3 FIA Embedded Derivative As of December 31, 2022 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Average Impact of Increase in Input Withdrawal rates [3] —% 15.9% 1.7% Decrease Lapse rates [4] 1.0% 25.0% 6.5% Decrease Option budgets [9] 0.5% 3.8% 1.6% Increase Credit standing adjustment [7] —% 0.2% 0.1% Decrease As of December 31, 2021 (Successor Company) Unobservable Inputs (Minimum) Unobservable Inputs (Maximum) Weighted Average Impact of Increase in Input Withdrawal rates [3] —% 16% 2% Decrease Lapse rates [4] 1% 34% 6% Decrease Option budgets [9] 1% 4% 2% Increase Credit standing adjustment [7] —% 0.1% 0.1% Decrease [1] Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table. [2] Range represents assumed percentages of policyholders taking withdrawals. [3] Range represents assumed annual percentage of allowable amount withdrawn. [4] Range represents assumed annual percentages of policyholders electing a full surrender. [5] Range represents assumed annual percentages of eligible policyholders electing to reset their guaranteed benefit base. [6] Range represents implied market volatilities for equity indices based on multiple pricing sources. [7] Range represents Company credit spreads, adjusted for market recoverability. [8] The impact may be an increase for some contracts, particularly those with out of the money guarantees. [9] Range represents assumed annual budget for index options. |
Roll-forward of Financial Instruments Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | The following tables present a reconciliation of the beginning and ending balances for fair value measurements for the year ended December 31, 2022 (Successor Company), for which the Company used significant unobservable inputs (Level 3): Fair Value Rollforwards for Financial Instruments Classified as Level 3 Total Realized/Unrealized Gains (Losses) Fair Value as of December 31, 2021 Included in Net Income [1] [2] [6] Included in OCI [3] Purchases Settlements Sales Transfers into Transfers out of Level 3 [4] Fair Value as of December 31, 2022 Assets Fixed maturities, AFS ABS $ — $ — $ (2) $ 52 $ (6) $ — $ — $ (3) $ 41 CLOs 159 — (1) 80 (54) — — (75) 109 CMBS 276 — (26) 68 (34) — — (7) 277 Corporate 665 (2) (43) 132 (137) (10) 20 (6) 619 Foreign govt./govt. agencies — — (1) 5 — — — — 4 Municipal 1 — — — — — — — 1 RMBS 74 — (1) 22 (26) (19) — (33) 17 Total fixed maturities, AFS 1,175 (2) (74) 359 (257) (29) 20 (124) 1,068 Fixed Maturities, FVO — (21) — 327 — — — — 306 Equity securities, at fair value 21 6 — 8 (11) — — — 24 LPs and other alternative investments, FVO — 16 — 42 — — — — 58 Freestanding derivatives Interest rate — 22 — — (22) — — — — Macro hedge program (188) 74 — 351 (89) — — — 148 Total freestanding derivatives [5] (188) 96 — 351 (111) — — — 148 Short-term investments 75 — — 192 (80) — — (50) 137 Reinsurance recoverable for FIA options — (22) — 123 (52) — — — 49 Reinsurance recoverable for FIA embedded derivative — — — 288 — — — — 288 Reinsurance recoverable for GMWB (8) (14) — — (109) — — — (131) Separate accounts 79 (2) — 99 — (23) — (100) 53 Total assets $ 1,154 $ 57 $ (74) $ 1,789 $ (620) $ (52) $ 20 $ (274) $ 2,000 (Liabilities) Other policyholder funds and benefits payable FIA embedded derivative $ (655) $ 256 $ — $ (13) $ 27 $ — $ — $ — $ (385) GMWB embedded derivative 80 88 — — (37) — — — 131 Total other policyholder funds and benefits payable (575) 344 — (13) (10) — — — (254) Funds withheld on modified coinsurance reinsurance contracts — — — (37) — — — — (37) Total liabilities $ (575) $ 344 $ — $ (50) $ (10) $ — $ — $ — $ (291) The following table presents a reconciliation of the beginning and ending balances for fair value measurements for the period of July 1, 2021 to December 31, 2021 (Successor Company), for which the Company used significant unobservable inputs (Level 3): Fair Value Rollforwards for Financial Instruments Classified as Level 3 Total Realized/Unrealized Gains (Losses) Fair Value as of July 1, 2021 Included in Net Income [1] [2] [6] Included in OCI [3] Purchases Settlements Sales Transfers into Transfers out of Level 3 [4] Fair Value as of December 31, 2021 Assets Fixed maturities, AFS ABS $ 8 $ — $ — $ — $ — $ — $ — $ (8) $ — CLOs 248 — — 34 (64) — — (59) 159 CMBS 143 — (2) 136 (1) — — — 276 Corporate 460 3 (2) 245 (30) (11) — — 665 Municipal — — — — — — 1 — 1 RMBS 108 — — 29 (29) (19) — (15) 74 Total fixed maturities, AFS 967 3 (4) 444 (124) (30) 1 (82) 1,175 Equity securities, at fair value 33 20 — — (32) — — — 21 Freestanding derivatives Interest rate 2 2 — (4) — — — — — Total freestanding derivatives [5] 2 2 — (4) — — — — — Reinsurance recoverable for GMWB (6) (8) — — 6 — — — (8) Short-term investments 14 — — 88 (27) — — — 75 Separate accounts 15 — — 71 — (5) 4 (6) 79 Total assets $ 1,025 $ 17 $ (4) $ 599 $ (177) $ (35) $ 5 $ (88) $ 1,342 Liabilities Freestanding derivatives Macro hedge program $ (237) $ 153 $ — $ (1) $ (103) $ — $ — $ — $ (188) Total freestanding derivatives [5] (237) 153 — (1) (103) — — — (188) Other policyholder funds and benefits payable FIA embedded derivative — — — (655) — — — — (655) Guaranteed withdrawal benefits 77 29 — — (26) — — — 80 Total other policyholder funds and benefits payable 77 29 — (655) (26) — — — (575) Total liabilities $ (160) $ 182 $ — $ (656) $ (129) $ — $ — $ — $ (763) The following table presents a reconciliation of the beginning and ending balances for fair value measurements for the six months ended June 30, 2021 (Predecessor Company), for which the Company used significant unobservable inputs (Level 3): Fair Value Rollforwards for Financial Instruments Classified as Level 3 Total Realized/Unrealized Gains (Losses) Fair Value as of December 31, 2020 Included in Net Income [1] [2] [6] Included in OCI [3] Purchases Settlements Sales Transfers into Transfers out of Level 3 [4] Fair Value as of June 30, 2021 Assets Fixed maturities, AFS ABS $ — $ — $ — $ 10 $ — $ — $ — $ (2) $ 8 CLOs 259 — — 50 (36) — — (25) 248 CMBS 54 — 2 90 — — 2 (5) 143 Corporate 328 — (6) 132 (23) (9) 53 (15) 460 RMBS 154 — 1 5 (34) (15) — (3) 108 Total fixed maturities, AFS 795 — (3) 287 (93) (24) 55 (50) 967 Equity securities, at fair value 32 — — 1 — — — — 33 Freestanding derivatives Interest rate 2 — — — — — — — 2 Total freestanding derivatives [5] 2 — — — — — — — 2 Reinsurance recoverable for GMWB 7 (19) — — 6 — — — (6) Short-term investments 22 — — 2 (10) — — — 14 Separate accounts 20 — — 2 — (4) 2 (5) 15 Total assets $ 878 $ (19) $ (3) $ 292 $ (97) $ (28) $ 57 $ (55) $ 1,025 Liabilities Freestanding derivatives Macro hedge program $ (441) $ 385 $ — $ 12 $ (193) $ — $ — $ — $ (237) Total freestanding derivatives [5] (441) 385 — 12 (193) — — — (237) Other policyholder funds and benefits payable Guaranteed withdrawal benefits 21 82 — — (26) — — — 77 Total other policyholder funds and benefits payable 21 82 — — (26) — — — 77 Total liabilities $ (420) $ 467 $ — $ 12 $ (219) $ — $ — $ — $ (160) [1] The Company classifies realized and unrealized gains (losses) on FIA and GMWB reinsurance derivatives and GMWB embedded derivatives as unrealized gains (losses) for purposes of disclosure in this table because it is impracticable to track on a contract-by-contract basis the realized gains (losses) for these derivatives and embedded derivatives. [2] Amounts in these columns are generally reported in net realized capital gains (losses). The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities, which results in a net zero impact on net income for the Company. All amounts are before income taxes and amortization. [3] All amounts are before income taxes and amortization. [4] Transfers in and/or (out) of Level 3 are primarily attributable to the availability of market observable information and the re-evaluation of the observability of pricing inputs. [5] Derivative instruments are reported in this table on a net basis for asset (liability) positions and reported on the Consolidated Balance Sheets in other investments and other liabilities. [6] Includes both market and non-market impacts in deriving realized and unrealized gains (losses). Changes in Unrealized Gains (Losses) Included in Net Income for Financial Instruments Classified as Level 3 Still Held at End of Period [1] [2] Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 Assets Fixed maturities, AFS Corporate $ (2) $ — $ — Total fixed maturities, AFS (2) — — Fixed maturities, FVO (21) — — Equity securities, at fair value — — — Limited partnerships and other alternative investments, FVO 16 — — Freestanding derivatives Interest rate (3) 2 (40) Macro hedge program 42 — — Total freestanding derivatives 39 2 (40) Reinsurance recoverable for FIA options (22) — — Reinsurance recoverable for GMWB (14) (8) (19) Separate accounts (2) — — Total assets (6) (6) (59) (Liabilities) Freestanding derivatives Macro hedge program — (63) (121) Total freestanding derivatives — (63) (121) Other policyholder funds and benefits payable FIA embedded derivative 256 — — GMWB embedded derivative 101 29 82 Total other policyholder funds and benefits payable 357 29 82 Total liabilities $ 357 $ (34) $ (39) [1] All amounts presented are reported in net realized capital gains (losses).The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities, which results in a net zero impact on net income for the Company. All amounts are before income taxes and amortization. [2] Amounts presented are for Level 3 only and therefore may not agree to other disclosures included herein. Changes in Unrealized Gains (Losses) Included in OCI for Financial Instruments Classified as Level 3 Still Held at End of Period [1] Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 Assets Fixed maturities, AFS ABS $ (2) $ — $ — CLOs (1) — — CMBS (26) (2) 3 Corporate (43) (2) (4) RMBS (2) — 1 Total fixed maturities, AFS (74) (4) — Total assets $ (74) $ (4) $ — [1] Changes in unrealized gains (losses) on fixed maturities, AFS are reported in changes in net unrealized gain on fixed maturities, AFS on the Consolidated Statements of Comprehensive Income (Loss). |
Fair Value Disclosure of Asset and Liability Not Measured at Fair Value | Financial Assets and Liabilities Not Carried at Fair Value Fair Value Successor Company Carrying Amount [1] Fair Carrying Amount [1] Fair December 31, 2022 December 31, 2021 Assets Policy loans Level 3 $ 1,495 $ 1,495 $ 1,484 $ 1,484 Mortgage loans [1] Level 3 $ 2,520 $ 2,232 $ 2,131 $ 2,138 Liabilities Other policyholder funds and benefits payable [2] Level 3 $ 4,834 $ 4,271 $ 5,137 $ 4,792 Funds withheld liability Level 3 $ 11,967 $ 11,967 $ 6,379 $ 6,379 [1] As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the carrying amount of mortgage loans was net of ACL of $15 and $12, respectively. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments [Abstract] | |
Investment Income | Net Investment Income Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 (Before tax) Fixed maturities [1] $ 620 $ 174 $ 243 $ 518 Equity securities 10 10 2 7 Mortgage loans 74 32 45 92 Policy loans 82 36 40 82 Limited partnerships and other alternative investments 168 259 216 130 Other [2] (146) 1 1 13 Investment expense (30) (14) (13) (26) Total net investment income $ 778 $ 498 $ 534 $ 816 [1] Includes net investment income on short-term investments and excludes amounts related to fixed maturities where the FVO was elected. |
Realized Gain (Loss) on Investments | Net Realized Capital Gains (Losses) Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 (Before tax) Gross gains on sales $ 2 $ 14 $ 55 $ 166 Gross losses on sales (532) (20) (8) (32) Net realized gains (losses) on sales of equity securities 5 19 — — Change in net unrealized gains (losses) on equity securities [1] (24) (2) — 1 Net credit losses on fixed maturities, AFS (1) — — (1) Change in ACL on mortgage loans (3) — 6 (8) Intent-to-sell impairments — — — (6) Change in fair value of fixed maturities, FVO (21) Change in fair value of LPs and other alternative investments, FVO 16 FIA embedded derivative 270 FIA hedging program (247) GMWB derivatives, net 82 Variable annuity macro hedge program (1) (67) (243) (414) Transactional foreign currency revaluation — — — 3 Non-qualifying foreign currency derivatives 7 5 (2) (7) Modified coinsurance reinsurance derivative contracts 1,136 15 22 (50) Other, net [2] (290) 16 (72) 192 Net realized capital gains (losses) $ 317 $ (20) $ (242) $ (74) [1] The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of December 31, 2022, were $(24) for the year ended December 31, 2022 (Successor Company). The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of December 31, 2021, were $(3) for the period of July 1, 2021 to December 31, 2021 (Successor Company). The net unrealized gains (losses) on equity securities included in net realized capital gains (losses) related to equity securities still held as of June 30, 2021 , were $1 for the six months ended June 30, 2021 (Predecessor Company). The net unrealized gains (losses) on equity securities included in net |
Debt Securities, Available-for-sale | Sales of AFS Securities Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Fixed maturities, AFS Sale proceeds $ 5,897 $ 2,372 $ 1,007 $ 1,789 Gross gains 2 14 55 165 Gross losses (531) (16) (8) (31) |
Debt Securities, Available-for-sale, Allowance for Credit Loss | ACL on Fixed Maturities, AFS by Type for the Year Ended December 31, 2022 (Successor Company) (Before tax) Corporate Total Balance, beginning of period $ — $ — Credit losses on fixed maturities where an allowance was not previously recorded 1 1 Write-offs charged against the allowance (1) (1) Balance, end of period $ — $ — ACL on Fixed Maturities, AFS by Type for the Period of July 1, 2021 to December 31, 2021 (Successor Company) (Before tax) Corporate Total Balance, beginning of period $ — $ — Credit losses on fixed maturities where an allowance was not previously recorded — — Balance, end of period $ — $ — ACL on Fixed Maturities, AFS by Type for the Six Months Ended June 30, 2021 (Predecessor Company) (Before tax) Corporate Total Balance, beginning of period $ 1 $ 1 Credit losses on fixed maturities where an allowance was not previously recorded — — Balance, end of period $ 1 $ 1 |
Schedule of Available-for-sale Securities Reconciliation | Fixed Maturities, AFS by Type Successor Company December 31, 2022 December 31, 2021 Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value ABS $ 276 $ — $ — $ (22) $ 254 $ 260 $ — $ — $ (2) $ 258 CLOs 703 — — (27) 676 945 — — (1) 944 CMBS 1,724 — 1 (211) 1,514 2,345 — 4 (14) 2,335 Corporate 12,565 — 2 (2,326) 10,241 13,380 — 50 (73) 13,357 Foreign government/government agencies 377 — — (62) 315 365 — 1 (4) 362 Municipal bonds 1,309 — — (269) 1,040 1,452 — 10 (6) 1,456 RMBS 503 — — (86) 417 818 — — (7) 811 U.S. Treasuries 1,232 — — (306) 926 1,421 — 28 (1) 1,448 Total fixed maturities, AFS $ 18,689 $ — $ 3 $ (3,309) $ 15,383 $ 20,986 $ — $ 93 $ (108) $ 20,971 |
Investments Classified by Contractual Maturity Date | Fixed Maturities, AFS by Contractual Maturity Year Successor Company December 31, 2022 December 31, 2021 Contractual Maturity Amortized Fair Amortized Fair One year or less $ 445 $ 437 $ 341 $ 341 Over one year through five years 2,392 2,214 2,904 2,890 Over five years through ten years 4,438 3,732 5,248 5,241 Over ten years 8,209 6,140 8,125 8,151 Subtotal 15,484 12,523 16,618 16,623 Mortgage-backed, CLOs and ABS 3,205 2,860 4,368 4,348 Total fixed maturities, AFS $ 18,689 $ 15,383 $ 20,986 $ 20,971 |
Fair Value, Concentration of Risk | As of December 31, 2022 (Successor Company), we are providing the top 25 investment concentrations, other than the U.S. government and certain U.S. government agencies and commercial mortgage loans, due to the size of our investment portfolio in comparison to our stockholders’ equity as of December 31, 2022. As of December 31, 2021 (Successor Company), the Company did not have any credit concentration risk of a single issuer greater than 10% of the Company's stockholders' equity. Top 25 Investment Holdings by Issuer Market Value Pacific Investment Management LLC $ 347 Madison Capital Funding 195 Harbourvest 131 Bank of America 121 Twin Brook Capital Partners 104 Oracle Corporation 95 Whitehorse Liquidity Partners 91 Mitsubishi UFJ Financial Group 90 Citigroup 88 Mizuho Financial Group 87 J.P. Morgan & Co. 85 International Business Machines Corporation 84 Boeing Company 82 Goldman Sachs Group, Inc. 75 Wells Fargo & Company 74 Sumitomo Mitsui Financial Group 73 UnitedHealth Group Inc. 70 Walt Disney Company 70 Strategic Partners VIII L.P. 69 T-Mobile US, Inc 69 Deutsche Telekom International Finance B.V. 66 Amgen Inc. 65 Gridiron Capital Fund III LP 65 ING Group 63 Strategic Partners Touchdown Holdings L.P. $ 62 |
Unrealized Gain (Loss) on Investments | Unrealized Losses on Fixed Maturities, AFS Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of December 31, 2022 Successor Company Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized ABS $ 96 $ (5) $ 162 $ (17) $ 258 $ (22) CLOs 644 (27) 11 — 655 (27) CMBS 819 (102) 682 (109) 1,501 (211) Corporate 6,659 (1,544) 3,412 (782) 10,071 (2,326) Foreign government/government agencies 185 (41) 128 (21) 313 (62) Municipal 859 (219) 180 (50) 1,039 (269) RMBS 123 (20) 293 (66) 416 (86) U.S. Treasuries 864 (293) 63 (13) 927 (306) Total fixed maturities, AFS in an unrealized loss position $ 10,249 $ (2,251) $ 4,931 $ (1,058) $ 15,180 $ (3,309) Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of December 31, 2021 Successor Company Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized ABS $ 252 $ (2) $ — $ — $ 252 $ (2) CLOs 751 (1) — — 751 (1) CMBS 961 (14) — — 961 (14) Corporate 5,788 (73) — — 5,788 (73) Foreign government/government agencies 173 (4) — — 173 (4) Municipal 337 (6) — — 337 (6) RMBS 537 (7) — — 537 (7) U.S. Treasuries 217 (1) — — 217 (1) Total fixed maturities, AFS in an unrealized loss position $ 9,016 $ (108) $ — $ — $ 9,016 $ (108) |
Financing Receivable, Allowance for Credit Loss | ACL on Mortgage Loans Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Beginning balance $ 12 $ — $ 17 $ — Cumulative effect of accounting changes [1] 9 Cumulative effect of pushdown accounting 12 Adjusted beginning balance ACL 12 12 17 9 Current period provision (release) 3 — (6) 8 Ending balance $ 15 $ 12 $ 11 $ 17 [1] Represents the establishment of an ACL due to the adoption of expected credit loss accounting guidance. Refer to Note 1 - Basis of Presentation and Significant Accounting Policies for additional information. |
Financing Receivable Credit Quality Indicators | Mortgage Loans LTV & DSCR by Origination Year as of December 31, 2022 (Successor Company) 2022 2021 2020 2019 2018 2017 & Prior Total Loan-to-Value Amortized Cost Avg. DSCR [2] Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost [1] Avg. DSCR [2] Greater than 80% $ 54 —x $ — —x $ — —x $ — —x $ — —x $ 41 2.09x $ 95 2.09x 65% - 80% 10 2.02x 21 2.51x 14 2.79x 27 2.08x 116 1.28x 60 1.77x 248 1.71x Less than 65% 461 2.47x 379 2.76x 166 2.65x 220 2.92x 181 2.14x 785 2.74x 2,192 2.67x Total mortgage loans $ 525 2.45x $ 400 2.74x $ 180 2.66x $ 247 2.83x $ 297 1.80x $ 886 2.64x $ 2,535 2.55x [1] As of December 31, 2022 (Successor Company), the amortized cost of mortgage loans excludes ACL of $15. [2] Ratios exclude certain single family residential mortgage loans. Mortgage Loans LTV & DSCR by Origination Year as of December 31, 2021 (Successor Company) 2021 2020 2019 2018 2017 2016 & Prior Total Loan-to-Value Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost Avg. DSCR Amortized Cost [1] Avg. DSCR 65% - 80% $ 7 2.37x $ 18 2.62x $ 25 1.55x $ 43 1.00x $ 41 1.94x $ 37 1.23x $ 171 1.60x Less than 65% 378 2.68x 160 2.43x 234 2.89x 270 2.00x 235 2.27x 695 2.54x 1,972 2.50x Total mortgage loans $ 385 2.68x $ 178 2.45x $ 259 2.76x $ 313 1.86x $ 276 2.22x $ 732 2.47x $ 2,143 2.42x [1] As of December 31, 2021 (Successor Company), the amortized cost of mortgage loans excludes ACL of $12. |
Investment in Mortgage Loans on Real Estate | Mortgage Loans by Region Successor Company December 31, 2022 December 31, 2021 Amortized Percent of Total Amortized Percent of Total East North Central $ 74 2.9 % $ 78 3.6 % East South Central 32 1.3 % 20 0.9 % Middle Atlantic 194 7.7 % 152 7.1 % Mountain 185 7.3 % 142 6.6 % New England 82 3.2 % 87 4.1 % Pacific 535 21.1 % 559 26.1 % South Atlantic 694 27.4 % 627 29.3 % West South Central 180 7.1 % 184 8.6 % Other [2] 559 22.0 % 294 13.7 % Total mortgage loans $ 2,535 100 % $ 2,143 100 % [1] As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the amortized cost of mortgage loans excludes ACL of $15 and $12, respectively. [2] Primarily represents loans collateralized by multiple properties in various regions. Mortgage Loans by Property Type Successor Company December 31, 2022 December 31, 2021 Amortized Percent of Total Amortized Percent of Total Commercial Industrial $ 787 31.0 % $ 711 33.2 % Multifamily 669 26.4 % 590 27.5 % Office 383 15.1 % 423 19.7 % Retail 443 17.5 % 403 18.8 % Single Family 253 10.0 % 16 0.8 % Total mortgage loans $ 2,535 100 % $ 2,143 100 % [1] As of December 31, 2022 (Successor Company) and 2021 (Successor Company), the amortized cost of mortgage loans excludes ACL of $15 and $12, respectively. |
Offsetting Liabilities | Repurchase Agreements Successor Company December 31, 2022 December 31, 2021 Fair Value Fair Value Repurchase agreements: Gross amount of recognized liabilities for repurchase agreements $ 564 $ 663 Gross amount of collateral pledged related to repurchase agreements [1] $ 577 $ 679 Gross amount of recognized receivables for reverse repurchase agreements [2] $ 7 $ 44 [1] Collateral pledged is included within fixed maturities, AFS and short-term investments on the Company's Consolidated Balance Sheets. [2] Collateral received is included within short-term investments on the Company's Consolidated Balance Sheets. Offsetting Derivative Assets and Liabilities (i) (ii) (iii) = (i) - (ii) (iv) (v) = (iii) - (iv) Net Amounts Presented on the Statement of Financial Position Collateral Disallowed for Offset on the Statement of Financial Position Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset on the Statement of Financial Position Derivative Assets [1] (Liabilities) [2] Accrued Interest and Cash Collateral (Received) [3] Pledged [2] Financial Collateral (Received) Pledged [4] Net Amount As of December 31, 2022 (Successor Company) Other investments $ 529 $ 446 $ 195 $ (112) $ 68 $ 15 Other liabilities (300) (195) 34 (139) (103) (2) As of December 31, 2021 (Successor Company) Other investments $ 176 $ 162 $ 43 $ (29) $ 5 $ 9 Other liabilities (385) (134) (252) 1 (251) — [1] Included in other invested assets on the Company's Consolidated Balance Sheets. [2] Included in other liabilities on the Company's Consolidated Balance Sheets and is limited to the net derivative payable associated with each counterparty. [3] Included in other investments on the Company's Consolidated Balance Sheets and is limited to the net derivative receivable associated with each counterparty. [4] Excludes collateral associated with exchange-traded derivative instruments. |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | Net Asset Liability Derivatives Notional Fair Fair Fair Successor Company Successor Company Successor Company Successor Company Hedge Designation/Derivative Type Dec 31, 2022 Dec 31, 2021 Dec 31, 2022 Dec 31, 2021 Dec 31, 2022 Dec 31, 2021 Dec 31, 2022 Dec 31, 2021 Cash flow hedges Interest rate swaps $ 250 $ 100 $ — $ — $ — $ — $ — $ — Total cash flow hedges 250 100 — — — — — — Non-qualifying strategies Interest rate contracts Interest rate swaps and futures 1,363 3,074 (1) (7) 3 19 (4) (26) Foreign exchange contracts Foreign currency swaps and forwards 161 161 15 9 16 10 (1) (1) Credit contracts Credit derivatives that assume credit risk 500 100 4 2 4 2 — — Variable annuity hedge program GMWB product derivatives [1] 6,308 7,086 131 80 131 100 — (20) GMWB reinsurance contracts 1,397 1,555 (131) (8) — — (131) (8) GMWB hedging instruments — — — — — — — — Macro hedge program 22,823 22,991 211 (213) 506 145 (295) (358) Fixed indexed annuities FIA product derivative [1] [2] — — (385) (655) — — (385) (655) FIA reinsurance contracts [2] — — 288 — 288 — — — Other Modified coinsurance reinsurance contracts [2] — — 1,647 15 1,647 15 — — Total non-qualifying strategies 32,552 34,967 1,779 (777) 2,595 291 (816) (1,068) Total cash flow hedges and non-qualifying strategies $ 32,802 $ 35,067 $ 1,779 $ (777) $ 2,595 $ 291 $ (816) $ (1,068) Balance Sheet Location Fixed maturities, AFS $ 56 $ 56 $ — $ — $ — $ — $ — $ — Other investments 11,998 8,163 195 43 237 91 (42) (48) Other liabilities 13,043 18,206 34 (252) 292 85 (258) (337) Reinsurance recoverables 1,397 1,556 286 7 417 15 (131) (8) Funds withheld liability — — 1,518 — 1,518 — — — Other policyholder funds and benefits payable 6,308 7,086 (254) (575) 131 100 (385) (675) Total derivatives $ 32,802 $ 35,067 $ 1,779 $ (777) $ 2,595 $ 291 $ (816) $ (1,068) [1] These derivatives are embedded within liabilities and are not held for risk management purposes. [2] For certain assumed and ceded reinsurance agreements the notional value is not indicative of the volume of activity. Refer to Note 5 - Reinsurance for additional information regarding the activity which generated the value of the embedded derivative. |
Offsetting Assets | Offsetting Derivative Assets and Liabilities (i) (ii) (iii) = (i) - (ii) (iv) (v) = (iii) - (iv) Net Amounts Presented on the Statement of Financial Position Collateral Disallowed for Offset on the Statement of Financial Position Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset on the Statement of Financial Position Derivative Assets [1] (Liabilities) [2] Accrued Interest and Cash Collateral (Received) [3] Pledged [2] Financial Collateral (Received) Pledged [4] Net Amount As of December 31, 2022 (Successor Company) Other investments $ 529 $ 446 $ 195 $ (112) $ 68 $ 15 Other liabilities (300) (195) 34 (139) (103) (2) As of December 31, 2021 (Successor Company) Other investments $ 176 $ 162 $ 43 $ (29) $ 5 $ 9 Other liabilities (385) (134) (252) 1 (251) — [1] Included in other invested assets on the Company's Consolidated Balance Sheets. [2] Included in other liabilities on the Company's Consolidated Balance Sheets and is limited to the net derivative payable associated with each counterparty. [3] Included in other investments on the Company's Consolidated Balance Sheets and is limited to the net derivative receivable associated with each counterparty. [4] Excludes collateral associated with exchange-traded derivative instruments. |
Offsetting Liabilities | Repurchase Agreements Successor Company December 31, 2022 December 31, 2021 Fair Value Fair Value Repurchase agreements: Gross amount of recognized liabilities for repurchase agreements $ 564 $ 663 Gross amount of collateral pledged related to repurchase agreements [1] $ 577 $ 679 Gross amount of recognized receivables for reverse repurchase agreements [2] $ 7 $ 44 [1] Collateral pledged is included within fixed maturities, AFS and short-term investments on the Company's Consolidated Balance Sheets. [2] Collateral received is included within short-term investments on the Company's Consolidated Balance Sheets. Offsetting Derivative Assets and Liabilities (i) (ii) (iii) = (i) - (ii) (iv) (v) = (iii) - (iv) Net Amounts Presented on the Statement of Financial Position Collateral Disallowed for Offset on the Statement of Financial Position Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset on the Statement of Financial Position Derivative Assets [1] (Liabilities) [2] Accrued Interest and Cash Collateral (Received) [3] Pledged [2] Financial Collateral (Received) Pledged [4] Net Amount As of December 31, 2022 (Successor Company) Other investments $ 529 $ 446 $ 195 $ (112) $ 68 $ 15 Other liabilities (300) (195) 34 (139) (103) (2) As of December 31, 2021 (Successor Company) Other investments $ 176 $ 162 $ 43 $ (29) $ 5 $ 9 Other liabilities (385) (134) (252) 1 (251) — [1] Included in other invested assets on the Company's Consolidated Balance Sheets. [2] Included in other liabilities on the Company's Consolidated Balance Sheets and is limited to the net derivative payable associated with each counterparty. [3] Included in other investments on the Company's Consolidated Balance Sheets and is limited to the net derivative receivable associated with each counterparty. [4] Excludes collateral associated with exchange-traded derivative instruments. |
Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location | Derivatives in Cash Flow Hedging Relationships Pre-Tax Gain (Loss) Recognized in OCI Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Interest rate swaps $ (35) $ — $ — $ — Foreign currency swaps — — — (2) Total $ (35) $ — $ — $ (2) Derivatives in Cash Flow Hedging Relationships (Successor Company) Gain (Loss) Reclassified from AOCI into Income For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 Net Realized Capital Net Net Realized Capital Net Interest rate swaps $ — $ (1) $ — $ — Foreign currency swaps — — — — Total $ — $ (1) $ — $ — Total amounts presented in the Consolidated Statements of Operations $ 317 $ 778 $ (20) $ 498 |
Derivative Instruments, Gain (Loss) | Non-qualifying Strategies Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Variable annuity hedge program GMWB product derivatives $ 88 $ 29 $ 82 $ 67 GMWB reinsurance contracts (88) 4 (24) (27) GMWB hedging instruments 42 Variable annuity macro hedge program (1) (100) (301) (414) Total variable annuity hedge program (1) (67) (243) (332) Fixed Index Annuity FIA product derivatives 270 — — — Foreign exchange contracts Foreign currency swaps and forwards 7 5 (2) (4) Other non-qualifying derivatives Interest rate contracts Interest rate swaps, swaptions, and futures (306) 21 (76) 180 Credit contracts Credit derivatives that purchase credit protection — — — 19 Credit derivatives that assume credit risk 3 1 — — Other Modified coinsurance reinsurance contracts 1,136 15 22 (50) Total other non-qualifying derivatives 833 37 (54) 149 Total [1] $ 1,109 $ (25) $ (299) $ (187) [1] Excludes investments that contain an embedded credit derivative for which the Company has elected the FVO. |
Disclosure of Credit Derivatives | As of December 31, 2022 (Successor Company) Underlying Referenced Credit Obligation(s) [1] Credit Derivative Type by Derivative Risk Exposure Notional Fair Weighted Type Average Offsetting Offsetting Basket credit default swaps [3] Investment grade risk exposure $ 500 $ 4 5 years Corporate Credit BBB+ $ — $ — Total $ 500 $ 4 $ — $ — As of December 31, 2021 (Successor Company) Underlying Referenced Credit Obligation(s) [1] Credit Derivative Type by Derivative Risk Exposure Notional Fair Weighted Type Average Offsetting Offsetting Basket credit default swaps [3] Investment grade risk exposure $ 100 $ 2 5 years Corporate Credit BBB+ $ — $ — Total $ 100 $ 2 $ — $ — [1] The average credit ratings are based on availability and are generally the midpoint of the available ratings among Moody’s, S&P, and Fitch. If no rating is available from a rating agency, then an internally developed rating is used. [2] Notional amount is equal to the maximum potential future loss amount. These derivatives are governed by agreements and applicable law which include collateral posting requirements. There is no additional specific collateral related to these contracts or recourse provisions included in the contracts to offset losses. [3] Comprised of swaps of standard market indices of diversified portfolios of corporate and CMBS issuers referenced through credit default swaps. These swaps are subsequently valued based upon the observable standard market index. |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Insurance [Abstract] | |
Effects of Reinsurance | The following table summarizes the impacts of the transaction: Assets Investments $ 405 Cash 121 Other assets 3 Total assets 529 Liabilities Reserve for future policy benefits 3 Other policyholder funds and benefits payable 436 Other liabilities [1] 90 Total liabilities $ 529 [1] Other liabilities represents a deferred gain of $90. The following table summarizes the impacts of the transaction: Assets Investments $ 8,357 Cash (693) Other assets 75 Reinsurance recoverables 244 Total assets 7,983 Liabilities Reserve for future policy benefits 616 Other policyholder funds and benefits payable 7,340 Other liabilities [1] 27 Total liabilities $ 7,983 [1] Other liabilities includes a deferred gain of $25. The following table summarizes the impacts of these transactions: December 31, 2022 (Successor Company) Assets Reinsurance recoverables $ 5,192 VOBA and DAC (11) Total assets 5,181 Liabilities Funds withheld liability 5,045 Other liabilities [1] 136 Total liabilities $ 5,181 [1] Other liabilities includes a deferred gain of $137. December 31, 2021 (Successor Company) Assets Cash $ (184) Reinsurance recoverables 6,130 Total assets 5,946 Liabilities Funds withheld liability 5,128 Other liabilities [1] 818 Total liabilities $ 5,946 [1] Other liabilities includes a deferred gain of $805. For the year ended December 31, 2022 (Successor Company), the impacts in the Consolidated Statements of Operations from the Company's affiliated reinsurance arrangement entered into in 2021, was as follows: Affiliated Reinsurance Impacts Successor Company As of December 31, 2022 Revenues Policy charges and fee income $ (279) Premiums (27) Net investment income (136) Net realized capital gains 990 Amortization of deferred gains 27 Total revenues 575 Benefits, losses and expenses Benefits and losses (184) Insurance operating costs and other expenses (119) Total benefits, losses and expenses (303) Income before income taxes 878 Income tax expense 184 Net income $ 694 |
Reinsurance Recoverable | Reinsurance Recoverables, net Successor Company As of December 31, 2022 2021 Reserve for future policy benefits and other policyholder funds and benefits payable Sold businesses (MassMutual and Prudential) $ 20,174 $ 19,850 Commonwealth Annuity and Life Insurance Company ("Commonwealth") 8,001 8,718 TR Re 11,537 6,130 Other reinsurers 1,029 1,187 Gross reinsurance recoverables 40,741 35,885 Less: ACL 27 37 Reinsurance recoverables, net $ 40,714 $ 35,848 |
Life Insurance Fees Earned Premiums and Other | Insurance Revenues Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Gross premiums, policy charges and fee income $ 2,240 $ 1,173 $ 1,210 $ 2,221 Reinsurance assumed 210 69 64 125 Reinsurance ceded (1,835) (801) (812) (1,570) Net premiums, policy charges and fee income $ 615 $ 441 $ 462 $ 776 |
Value of Business Acquired an_2
Value of Business Acquired and Deferred Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Policy Acquisition Costs and Present Value of Future Profits [Abstract] | |
Present Value of Future Insurance Profits | Changes in the VOBA Balance Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Balance, beginning of period [1] $ 479 $ 565 $ 586 $ 696 Amortization - VOBA (45) (17) 29 14 Amortization - unlock benefit (charge), pre-tax (34) (73) 14 (64) Adjustments to unrealized gains on fixed maturities, AFS and other 108 4 26 (60) Balance, end of period $ 508 $ 479 $ 655 $ 586 [1] The beginning balance as of July 1, 2021 differs from the ending balance as of June 30, 2021, due to the application of pushdown accounting related to the Sixth Street Acquisition. For more information, see Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements. |
Present Value of Future Insurance Profits, Expected Amortization | Expected Remaining VOBA Amortization (Successor Company) 2023 $ 13 2024 $ 10 2025 $ 16 2026 $ 25 2027 $ 25 |
Deferred Policy Acquisition Costs | Changes in the DAC Asset (Successor Company) For the Year Ended December 31, 2022 Balance, beginning of period $ — Additions 22 Amortization - DAC — Amortization - unlock benefit (charge), pre-tax — Reinsurance impact (11) Balance, end of period $ 11 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill Carrying Value As of December 31, 2022 As of December 31, 2021 Balance, beginning of period $ 97 $ — Acquisitions [1] — 97 Balance, end of period $ 97 $ 97 [1] Related to the pushdown of purchase accounting related to the Sixth Street Acquisition. For more information, see Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements. |
Schedule of Indefinite-Lived Intangible Assets | Other Intangible Assets As of December 31, 2022 As of December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Carrying Value Gross Carrying Amount Accumulated Amortization Net Carrying Value Amortizing internally developed software $ 41 $ (9) $ 32 $ 41 $ (3) $ 38 Indefinite-lived state insurance licenses 26 — 26 26 — 26 Total other intangible assets $ 67 $ (9) $ 58 $ 67 $ (3) $ 64 |
Schedule of Finite-Lived Intangible Assets | Other Intangible Assets As of December 31, 2022 As of December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Carrying Value Gross Carrying Amount Accumulated Amortization Net Carrying Value Amortizing internally developed software $ 41 $ (9) $ 32 $ 41 $ (3) $ 38 Indefinite-lived state insurance licenses 26 — 26 26 — 26 Total other intangible assets $ 67 $ (9) $ 58 $ 67 $ (3) $ 64 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Expected Pre-tax Amortization Expense as of December 31, 2022 (Successor Company) 2023 $ 6 2024 $ 6 2025 $ 6 2026 $ 6 2027 $ 6 |
Reserves for Future Policy Be_2
Reserves for Future Policy Benefits and Separate Account Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Insurance [Abstract] | |
Schedule of Liability for Future Policy Benefits, by Product Segment | Changes in Reserves for Future Policy Benefits Successor Company Universal Life-Type Contracts VA GMDB/GMWB [1] FIA Guarantees and Other [2] Universal Life Secondary Traditional Annuity and Other Contracts [3] Total Future Policy Benefits Liability Balance, as of December 31, 2021 $ 340 $ 604 $ 4,605 $ 16,149 $ 21,698 Incurred 136 (25) 835 340 1,286 Paid (106) (84) (66) (801) (1,057) Change in unrealized investment gains and losses — (495) — — (495) Liability balance, as of December 31, 2022 $ 370 $ — $ 5,374 $ 15,688 $ 21,432 Reinsurance recoverable asset, as of December 31, 2021 $ 299 $ — $ 4,605 $ 10,135 $ 15,039 Incurred 92 — 835 154 1,081 Paid (77) — (66) (446) (589) Reinsurance recoverable asset, as of December 31, 2022 $ 314 $ — $ 5,374 $ 9,843 $ 15,531 Successor Company Universal Life-Type Contracts VA GMDB/GMWB [1] FIA Guarantees and Other [2] Universal Life Secondary Traditional Annuity and Other Contracts [3] Total Future Policy Benefits Liability balance, as of July 1, 2021 $ 346 $ — $ 4,394 $ 16,382 $ 21,122 Incurred [4] 38 604 240 253 1,135 Paid (44) — (29) (486) (559) Liability balance, as of December 31, 2021 $ 340 $ 604 $ 4,605 $ 16,149 $ 21,698 Reinsurance recoverable asset, as of July 1, 2021 $ 184 $ — $ 4,394 $ 5,422 $ 10,000 Incurred 152 — 240 4,845 5,237 Paid (37) — (29) (132) (198) Reinsurance recoverable asset, as of December 31, 2021 $ 299 $ — $ 4,605 $ 10,135 $ 15,039 Predecessor Company Universal Life-Type Contracts VA GMDB/ Universal Life Secondary Traditional Annuity and Other Contracts [3] Total Future Policy Benefits Liability balance, as of December 31, 2020 $ 460 $ 4,195 $ 13,970 $ 18,625 Incurred [4] 54 217 179 450 Paid (50) (18) (319) (387) Liability balance, as of June 30, 2021 $ 464 $ 4,394 $ 13,830 $ 18,688 Reinsurance recoverable asset, as of December 31, 2020 $ 254 $ 4,195 $ 4,690 $ 9,139 Incurred [4] 35 217 78 330 Paid (41) (18) (137) (196) Reinsurance recoverable asset, as of June 30, 2021 $ 248 $ 4,394 $ 4,631 $ 9,273 [1] These liability balances include all GMDB benefits, plus the life-contingent portion of GMWB benefits in excess of the return of the GRB. GMWB benefits up to the GRB are embedded derivatives held at fair value and are excluded from these balances. [2] These liability balances include additional liabilities for expected annuitizations on two-tiered FIA's and GLWB's, as part of the Allianz reinsurance agreement entered into on December 30, 2021. [3] Represents life-contingent reserves for which the company is subject to insurance and investment risk. [4] Includes the portion of assessments established as additions to reserves, changes in estimates affecting the reserves and the amounts recoverable under modified coinsurance reinsurance agreements. |
Schedule of Net Amount of Risk by Product and Guarantee | Account Value by GMDB/GMWB Type as of December 31, 2022 (Successor Company) Account Net amount Retained Net Weighted MAV [1] MAV only $ 9,984 $ 2,257 $ 302 74 With 5% rollup [2] 1,478 295 196 73 With earnings protection benefit rider (“EPB”) [3] 2,414 513 55 75 With 5% rollup & EPB 336 83 21 76 Total MAV 14,212 3,148 574 Asset protection benefit (“APB”) [4] 6,165 851 282 73 Lifetime income benefit (“LIB”) – death benefit [5] 258 4 2 76 Reset (5-7 years) [6] 2,122 96 56 72 Return of premium (“ROP”) /other [7] 10,097 105 62 71 Variable annuity without GMDB [8] 2,611 — — 73 Subtotal variable annuity [11] $ 35,465 $ 4,204 $ 976 73 Less: general account value 2,983 Subtotal separate account liabilities with GMDB 32,482 Separate account liabilities - other 62,393 Less: Separate account assets assumed under modified coinsurance [12] 6,613 Separate account base contract assets not reinsured [12] 1,007 Total separate account liabilities $ 87,255 [1] MAV GMDB is the greatest of current AV, net premiums paid and the highest AV on any anniversary before age 80 years (adjusted for withdrawals). [2] Rollup GMDB is the greatest of the MAV, current AV, net premium paid and premiums (adjusted for withdrawals) accumulated at generally 5% simple interest up to the earlier of age 80 years or 100% of adjusted premiums. [3] EPB GMDB is the greatest of the MAV, current AV, or contract value plus a percentage of the contract’s growth. The contract’s growth is AV less premiums net of withdrawals, subject to a cap of 200% of premiums net withdrawals. [4] APB GMDB is the greater of current AV or MAV, not to exceed current AV plus 25% times the greater of net premiums and MAV (each adjusted for premiums in the past 12 months). [5] LIB GMDB is the greatest of current AV; net premiums paid; or, for certain contracts, a benefit amount generally based on market performance that ratchets over time. [6] Reset GMDB is the greatest of current AV, net premiums paid and the most recent five to seven year anniversary AV before age 80 years (adjusted for withdrawals). [7] ROP GMDB is the greater of current AV and net premiums paid. [8] Includes account value for contracts that had a GMDB at issue but no longer have a GMDB due to certain elections made by policyholders or their beneficiaries. [9] AV includes the contract holder’s investment in the separate account and the general account. [10] NAR is defined as the guaranteed minimum death benefit in excess of the current AV. RNAR represents NAR reduced for reinsurance. NAR and RNAR are highly sensitive to equity market movements and increase when equity markets decline. [11] Some variable annuity contracts with GMDB also have a life-contingent GMWB that may provide for benefits in excess of the return of the GRB. Such contracts included in this amount have $8.6 billion of total account value and weighted average attained age of 72 years. There is no NAR or retained NAR related to these contracts. [12] Adjustment to remove AV for separate accounts that are not reflected on the Consolidated Balance Sheets, as they were assumed on a modified coinsurance basis and/or the Company has only reinsured certain associated GMDB and GMWB riders on a coinsurance basis. |
Schedule of Fair Value of Separate Accounts by Major Category of Investment | Account Balance Breakdown of Variable Separate Account Investments for Contracts with Guarantees Successor Company Asset Type December 31, 2022 December 31, 2021 Equity securities (including mutual funds) $ 24,548 $ 33,240 Cash and cash equivalents [1] 1,321 1,362 Total [2] $ 25,869 $ 34,602 [1] Represents an allocation of the portfolio holdings. [2] Includes $2.6 billion and $3.0 billion of account value as of December 31, 2022 (Successor Company) and 2021 (Successor Company), respectively, for contracts that had a GMDB at issue but no longer have a GMDB due to certain elections made by policyholders or their beneficiaries. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | Provision for Income Taxes Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Income Tax Expense (Benefit) Current - U.S. Federal $ (18) (86) $ — $ 10 Deferred - U.S. Federal 125 137 30 56 Total income tax expense $ 107 $ 51 $ 30 $ 66 |
Schedule of Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities on the Consolidated Balance Sheets represent the tax consequences of differences between the financial reporting and tax basis of assets and liabilities. Components of Deferred Tax Assets (Liabilities) Successor Company December 31, 2022 December 31, 2021 Deferred Tax Assets Tax basis deferred policy acquisition costs $ 129 $ 110 VOBA and reserves 349 716 Net operating loss carryover 1 25 Employee benefits 4 7 Foreign tax credit carryover 16 16 Net unrealized loss on investments 703 4 Deferred reinsurance gain 228 187 Total deferred tax assets 1,430 1,065 Deferred Tax Liabilities Investment related items (366) (449) Other (13) (13) Total deferred tax liabilities (379) (462) Net deferred tax asset $ 1,051 $ 603 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the tax provision at the U.S. Federal statutory rate to the provision (benefit) for income taxes is as follows. Income Tax Rate Reconciliation Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Tax provision at U.S. Federal statutory rate $ 152 $ 70 $ 45 $ 98 Dividends received deduction ("DRD") (38) (16) (14) (28) Foreign related investments (7) (2) (1) (4) Other — (1) — — Provision for income taxes $ 107 $ 51 $ 30 $ 66 |
Statutory Results (Tables)
Statutory Results (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Insurance [Abstract] | |
Statutory Accounting Practices Disclosure | Statutory Net Income (Loss) Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Combined statutory net income (loss) $ 441 $ (426) $ (2) $ 245 Statutory Capital Successor Company December 31, 2022 December 31, 2021 Statutory capital [1] $ 2,738 $ 2,153 [1] The Company relies upon a prescribed practice allowed by Connecticut state laws that allow the Company to receive a reinsurance reserve credit for reinsurance treaties that provide for a limited right of unilateral cancellation by the reinsurer. The benefit from this prescribed practice was approximately $40 and $29 as of December 31, 2022 (Successor Company) and 2021 (Successor Company), respectively. |
Changes in and Reclassificati_2
Changes in and Reclassifications From Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in AOCI, Net of Tax for the Year Ended December 31, 2022 (Successor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ (10) $ — $ (10) OCI before reclassifications (3,107) (34) (3,141) Amounts reclassified from AOCI 412 — 412 OCI, before tax (2,695) (34) (2,729) Income tax benefit (expense) 566 7 573 OCI, net of tax (2,129) (27) (2,156) Ending balance $ (2,139) $ (27) $ (2,166) Changes in AOCI, Net of Tax for the Period of July 1, 2021 to December 31, 2021 (Successor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ — $ — $ — OCI before reclassifications (14) — (14) Amounts reclassified from AOCI 2 — 2 OCI, before tax (12) — (12) Income tax benefit (expense) 2 — 2 OCI, net of tax (10) — (10) Ending balance $ (10) $ — $ (10) Changes in AOCI, Net of Tax for the Six Months Ended June 30, 2021 (Predecessor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ 1,282 $ (1) $ 1,281 OCI before reclassifications (301) — (301) Amounts reclassified from AOCI (47) 1 (46) OCI, before tax (348) 1 (347) Income tax benefit (expense) 73 — 73 OCI, net of tax (275) 1 (274) Ending balance $ 1,007 $ — $ 1,007 Changes in AOCI, Net of Tax for the Year Ended December 31, 2020 (Predecessor Company) Changes in Net Unrealized Gain on Fixed Maturities, AFS Unrealized Losses on Fixed Maturities, AFS for Which an ACL Has Been Recorded Net Gain on Cash Flow Hedging Instruments AOCI Beginning balance $ 717 $ — $ — $ 717 OCI before reclassifications 842 (1) (1) 840 Amounts reclassified from AOCI (127) 1 — (126) OCI, before tax 715 — (1) 714 Income tax benefit (expense) (150) — — (150) OCI, net of tax 565 — (1) 564 Ending balance $ 1,282 $ — $ (1) $ 1,281 |
Reclassification out of Accumulated Other Comprehensive Income | Reclassification from AOCI Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Affected Line Item on the Consolidated Statements Net Unrealized Gain on Fixed Maturities Available-for-sale securities $ (412) $ (2) $ 47 $ 127 Net realized capital gains (losses) (412) (2) 47 127 Income before income taxes (87) — 10 27 Income tax expense $ (325) $ (2) $ 37 $ 100 Net income Unrealized Losses on Fixed Maturities for Which an ACL Has Been Recorded Fixed maturities, AFS $ — $ — $ — $ (1) Net realized capital gains (losses) — — — (1) Income before income taxes — — — — Income tax expense $ — $ — $ — $ (1) Net income Net Gains on Cash-Flow Hedging Instruments Interest rate swaps $ — $ — $ — $ — Net realized capital gains (losses) Interest rate swaps — — — — Net investment income Foreign currency swaps — — (1) — Net realized capital gains (losses) — — (1) — Income before income taxes — — — — Income tax expense $ — $ — $ (1) $ — Net income Total amounts reclassified from AOCI $ (325) $ (2) $ 36 $ 99 Net income |
Revenue from Contracts with C_2
Revenue from Contracts with Customer (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from External Customers by Products and Services | Revenues from Contracts with Customers Successor Company Predecessor Company For the Year Ended December 31, 2022 For the Period of July 1, 2021 to December 31, 2021 For the Six Months Ended June 30, 2021 For the Year Ended December 31, 2020 Administration and distribution services fees $ 76 $ 45 $ 44 $ 80 |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies - Narrative (Details) contract in Thousands | 6 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2022 USD ($) contract | Nov. 01, 2022 USD ($) | Dec. 30, 2021 USD ($) | Sep. 17, 2021 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) contract | Dec. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Number of annuity contracts | contract | 490 | 490 | ||||||
Annuity contract, account value | $ 36,700,000,000 | $ 36,700,000,000 | ||||||
Private placement life insurance, account value | $ 39,000,000,000 | $ 39,000,000,000 | ||||||
Intangible assets, useful life | 7 years | |||||||
Number of reportable segments | 0 | |||||||
Maximum uncollateralized threshold for derivative counter party, single level entity | $ 7,000,000 | |||||||
Present value of future insurance profits, amortization period | 20 years | |||||||
The Hartford Financial Services Group | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Period of continuing involvement after disposal | 5 years | |||||||
FIA embedded derivative | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Assumed annuities | $ 6,400,000,000 | |||||||
Variable Annuity | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Assumed annuities | 6,600,000,000 | |||||||
Guardian | Reinsurance Contract [Axis]: GIAC Reinsurance Agreement | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsurance payable | $ 7,100,000,000 | |||||||
Assumed reinsurance, consideration received | 121,000,000 | |||||||
Payment for ceded commissions | 65,000,000 | |||||||
Assumed reinsurance, deferred gain | $ 90,000,000 | |||||||
Guardian | Reinsurance Contract [Axis]: GIAC Reinsurance Agreement | General Account Reserves | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 100% | |||||||
Reinsurance payable | $ 439,000,000 | |||||||
Guardian | Reinsurance Contract [Axis]: GIAC Reinsurance Agreement | Separate Account Reserves | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 100% | |||||||
Reinsurance payable | $ 6,700,000,000 | |||||||
Allianz | FIA embedded derivative | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Assumed annuities | $ 8,000,000,000 | |||||||
Allianz | Fixed Indexed Annuities, Block One | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Assumed annuities | 5,000,000,000 | |||||||
Allianz | Fixed Indexed Annuities, Block Two | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Assumed annuities | 3,000,000,000 | |||||||
Allianz | Reinsurance Contract [Axis]: Inforce Reinsurance Agreement | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Payment for ceded commissions | 866,000,000 | |||||||
Assumed reinsurance, deferred gain | 25,000,000 | |||||||
Assumed reinsurance, consideration transferred | $ 693,000,000 | |||||||
Allianz | Reinsurance Contract [Axis]: Inforce Reinsurance Agreement | Fixed Indexed Annuities, Block One | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 100% | |||||||
Allianz | Reinsurance Contract [Axis]: Inforce Reinsurance Agreement | Fixed Indexed Annuities, Block Two | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 5% | |||||||
Lincoln National Life Insurance Company | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Maximum reinsured deposits | $ 1,500,000,000 | |||||||
TR Re | Reinsurance Contract [Axis]: Inforce Agreement and Flow Agreement | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 75% | |||||||
Assumed reinsurance, deferred gain | $ 137,000,000 | $ 137,000,000 | ||||||
TR Re | Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Payment for ceded commissions | $ 100,000,000 | |||||||
Assumed reinsurance, deferred gain | 805,000,000 | |||||||
Payment for assumed reinsurance, tax settlement | $ 84,000,000 | |||||||
TR Re | Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | Variable Annuity and Payout Annuity Blocks | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 50% | |||||||
TR Re | Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | Variable Annuity Guarantees and Structured Settlement Contracts | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reinsured risk, percentage | 100% | |||||||
Sixth Street | Talcott Resolution Life, Inc | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Voting interest acquired | 100% | |||||||
Consideration transferred | $ 2,200,000,000 | |||||||
Consideration transferred, pre-closing dividend | 500,000,000 | |||||||
Consideration transferred, cash | $ 1,700,000,000 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies - Schedule of Pushdown Accounting (Details) $ in Millions | Jul. 01, 2021 USD ($) |
Business Acquisition [Line Items] | |
Assets | $ 164,515 |
Liabilities | 162,632 |
Stockholder's equity | 1,883 |
Total liabilities and stockholder's equity | 164,515 |
Cash | |
Business Acquisition [Line Items] | |
Assets | 19,711 |
VOBA | |
Business Acquisition [Line Items] | |
Assets | 565 |
Deferred income taxes | |
Business Acquisition [Line Items] | |
Assets | 737 |
Goodwill | |
Business Acquisition [Line Items] | |
Assets | 97 |
Other intangible assets | |
Business Acquisition [Line Items] | |
Assets | 67 |
Reinsurance recoverables and other assets | |
Business Acquisition [Line Items] | |
Assets | 30,481 |
Separate account asset (liability) | |
Business Acquisition [Line Items] | |
Assets | 112,857 |
Liabilities | 112,857 |
Reserves for future policy benefits | |
Business Acquisition [Line Items] | |
Liabilities | 21,122 |
Other policyholder funds and benefits payable | |
Business Acquisition [Line Items] | |
Liabilities | 25,961 |
Funds withheld liability | |
Business Acquisition [Line Items] | |
Liabilities | 1,039 |
Other liabilities | |
Business Acquisition [Line Items] | |
Liabilities | $ 1,653 |
Fair Value Measurements- Fair V
Fair Value Measurements- Fair Value Hierarchy (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | $ 15,383 | $ 20,971 |
Fixed maturities, at fair value, using fair value option | 331 | 0 |
Equity securities, at fair value | 179 | 203 |
Limited partnerships and other alternative investments, fair value | 58 | 0 |
Short-term investments | 1,489 | 1,254 |
Derivative, fair value | 1,779 | (777) |
Reinsurance recoverables | 40,714 | 35,848 |
Separate account assets | 87,255 | 111,592 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Funds withheld on modified coinsurance reinsurance contracts | 10,485 | 6,379 |
Separate account assets | 1,100 | 1,600 |
Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 15,383 | 20,971 |
Fixed maturities, at fair value, using fair value option | 331 | |
Equity securities, at fair value | 179 | 203 |
Limited partnerships and other alternative investments, fair value | 58 | |
Derivative assets | 195 | 43 |
Short-term investments | 1,489 | 1,254 |
Separate account assets | 86,122 | 110,021 |
Total assets accounted for at fair value on a recurring basis | 104,092 | 132,484 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | (254) | (575) |
Derivative assets (liabilities) | 34 | (252) |
Total liabilities accounted for at fair value on a recurring basis | 1,261 | (812) |
FIA embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | (385) | (655) |
GMWB embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 131 | 80 |
Estimate of fair value | ||
Assets accounted for at fair value on a recurring basis | ||
Separate account assets | 289 | 404 |
Credit derivatives | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 4 | |
Credit derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 2 | |
Foreign exchange derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 1 | 7 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 14 | 2 |
Interest rate derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 18 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | (1) | (25) |
Macro hedge program | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 194 | 16 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 17 | (229) |
Reinsurance recoverable for FIA options | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 49 | |
Reinsurance recoverable for FIA embedded derivative | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 288 | |
Reinsurance recoverable for GMWB | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | (131) | (8) |
Funds withheld on modified coinsurance reinsurance contracts | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 129 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 1,481 | 15 |
ABS | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 254 | 258 |
ABS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 254 | 258 |
CLOs | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 676 | 944 |
CLOs | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 676 | 944 |
CMBS | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1,514 | 2,335 |
CMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1,514 | 2,335 |
Corporate | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 10,241 | 13,357 |
Corporate | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 10,241 | 13,357 |
Foreign governments | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 315 | 362 |
Foreign governments | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 315 | 362 |
Municipal | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1,040 | 1,456 |
RMBS | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 417 | 811 |
RMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 417 | 811 |
U.S. Treasuries | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 926 | 1,448 |
U.S. Treasuries | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 926 | 1,448 |
Level 1 | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 166 |
Fixed maturities, at fair value, using fair value option | 0 | |
Equity securities, at fair value | 0 | 11 |
Limited partnerships and other alternative investments, fair value | 0 | |
Derivative assets | 0 | 0 |
Short-term investments | 742 | 744 |
Separate account assets | 52,642 | 69,089 |
Total assets accounted for at fair value on a recurring basis | 53,384 | 70,010 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 0 | 0 |
Derivative assets (liabilities) | 0 | 0 |
Total liabilities accounted for at fair value on a recurring basis | 0 | 0 |
Level 1 | FIA embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 0 | 0 |
Level 1 | GMWB embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 0 | 0 |
Level 1 | Credit derivatives | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | |
Level 1 | Credit derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 0 | |
Level 1 | Foreign exchange derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 0 | 0 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | 0 |
Level 1 | Interest rate derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 0 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | 0 |
Level 1 | Macro hedge program | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 0 | 0 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | 0 |
Level 1 | Reinsurance recoverable for FIA options | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | |
Level 1 | Reinsurance recoverable for FIA embedded derivative | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | |
Level 1 | Reinsurance recoverable for GMWB | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | 0 |
Level 1 | Funds withheld on modified coinsurance reinsurance contracts | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | 0 |
Level 1 | ABS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 0 |
Level 1 | CLOs | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 0 |
Level 1 | CMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 0 |
Level 1 | Corporate | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 39 |
Level 1 | Foreign governments | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 0 |
Level 1 | Municipal | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 0 |
Level 1 | RMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 0 |
Level 1 | U.S. Treasuries | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 0 | 127 |
Level 2 | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 14,315 | 19,630 |
Fixed maturities, at fair value, using fair value option | 25 | |
Equity securities, at fair value | 155 | 171 |
Limited partnerships and other alternative investments, fair value | 0 | |
Derivative assets | 40 | 13 |
Short-term investments | 610 | 435 |
Separate account assets | 33,139 | 40,449 |
Total assets accounted for at fair value on a recurring basis | 48,413 | 60,698 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 0 | 0 |
Derivative assets (liabilities) | 41 | (34) |
Total liabilities accounted for at fair value on a recurring basis | 1,559 | (19) |
Level 2 | FIA embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 0 | 0 |
Level 2 | GMWB embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 0 | 0 |
Level 2 | Credit derivatives | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 4 | |
Level 2 | Credit derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 2 | |
Level 2 | Foreign exchange derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 1 | 7 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 14 | 2 |
Level 2 | Interest rate derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 15 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | (1) | (22) |
Level 2 | Macro hedge program | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 39 | (11) |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 24 | (14) |
Level 2 | Reinsurance recoverable for FIA options | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | |
Level 2 | Reinsurance recoverable for FIA embedded derivative | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | |
Level 2 | Reinsurance recoverable for GMWB | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | 0 |
Level 2 | Funds withheld on modified coinsurance reinsurance contracts | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 129 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 1,518 | 15 |
Level 2 | ABS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 213 | 258 |
Level 2 | CLOs | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 567 | 785 |
Level 2 | CMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1,237 | 2,059 |
Level 2 | Corporate | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 9,622 | 12,653 |
Level 2 | Foreign governments | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 311 | 362 |
Level 2 | Municipal | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1,039 | 1,455 |
Level 2 | RMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 400 | 737 |
Level 2 | U.S. Treasuries | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 926 | 1,321 |
Level 3 | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1,068 | 1,175 |
Fixed maturities, at fair value, using fair value option | 306 | |
Equity securities, at fair value | 24 | 21 |
Limited partnerships and other alternative investments, fair value | 58 | |
Derivative assets | 155 | 30 |
Short-term investments | 137 | 75 |
Separate account assets | 53 | 79 |
Total assets accounted for at fair value on a recurring basis | 2,007 | 1,372 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | (254) | (575) |
Derivative assets (liabilities) | (7) | (218) |
Total liabilities accounted for at fair value on a recurring basis | (298) | (793) |
Level 3 | FIA embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | (385) | (655) |
Level 3 | GMWB embedded derivative | Recurring | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Total other policyholder funds and benefits payable | 131 | 80 |
Level 3 | Estimate of fair value | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Funds withheld on modified coinsurance reinsurance contracts | 11,967 | 6,379 |
Level 3 | Credit derivatives | ||
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | |
Level 3 | Credit derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 0 | |
Level 3 | Foreign exchange derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 0 | 0 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | 0 |
Level 3 | Interest rate derivatives | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 3 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | 0 | (3) |
Level 3 | Macro hedge program | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative assets | 155 | 27 |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | (7) | (215) |
Level 3 | Reinsurance recoverable for FIA options | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 49 | |
Level 3 | Reinsurance recoverable for FIA embedded derivative | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 288 | |
Level 3 | Reinsurance recoverable for GMWB | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | (131) | (8) |
Level 3 | Funds withheld on modified coinsurance reinsurance contracts | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Derivative, fair value | 0 | |
Liabilities Accounted for at Fair Value on a Recurring Basis | ||
Derivative assets (liabilities) | (37) | 0 |
Level 3 | ABS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 41 | 0 |
Level 3 | CLOs | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 109 | 159 |
Level 3 | CMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 277 | 276 |
Level 3 | Corporate | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 619 | 665 |
Level 3 | Foreign governments | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 4 | 0 |
Level 3 | Municipal | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 1 | 1 |
Level 3 | RMBS | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | 17 | 74 |
Level 3 | U.S. Treasuries | Recurring | ||
Assets accounted for at fair value on a recurring basis | ||
Fixed maturities, AFS | $ 0 | $ 0 |
Fair Value Measurements - Signi
Fair Value Measurements - Significant Unobservable Inputs for Level 3 - Securities (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 15,383 | $ 20,971 |
Fixed maturities, at fair value, using fair value option | 331 | 0 |
ABS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 254 | 258 |
CMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 1,514 | 2,335 |
Corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 10,241 | 13,357 |
RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 417 | 811 |
Recurring | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 15,383 | 20,971 |
Fixed maturities, at fair value, using fair value option | 331 | |
Recurring | ABS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 254 | 258 |
Recurring | CMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 1,514 | 2,335 |
Recurring | Corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 10,241 | 13,357 |
Recurring | RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 417 | 811 |
Recurring | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 1,068 | 1,175 |
Fixed maturities, at fair value, using fair value option | 306 | |
Recurring | Level 3 | ABS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 41 | 0 |
Recurring | Level 3 | CMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | 277 | 276 |
Recurring | Level 3 | Corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 619 | $ 665 |
Impact of Increase in Input on Fair Value | Decrease | Decrease |
Recurring | Level 3 | RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 17 | $ 74 |
Recurring | Spread | Level 3 | CLOs | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 109 | $ 159 |
Impact of Increase in Input on Fair Value | Decrease | Decrease |
Recurring | Spread | Level 3 | CLOs | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0055 | 0.0234 |
Recurring | Spread | Level 3 | CLOs | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0337 | 0.0258 |
Recurring | Spread | Level 3 | CLOs | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0325 | 0.0257 |
Recurring | Spread | Level 3 | CMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 277 | $ 276 |
Impact of Increase in Input on Fair Value | Decrease | Decrease |
Recurring | Spread | Level 3 | CMBS | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0419 | 0.0203 |
Recurring | Spread | Level 3 | CMBS | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.1001 | 0.0637 |
Recurring | Spread | Level 3 | CMBS | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0534 | 0.0303 |
Recurring | Spread | Level 3 | Corporate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 901 | $ 623 |
Fixed maturities, at fair value, using fair value option | $ 306 | |
Recurring | Spread | Level 3 | Corporate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0071 | 0.0125 |
Recurring | Spread | Level 3 | Corporate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0719 | 0.1227 |
Recurring | Spread | Level 3 | Corporate | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0309 | 0.0278 |
Recurring | Spread | Level 3 | RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fixed maturities, AFS | $ 13 | $ 65 |
Impact of Increase in Input on Fair Value | Decrease | Decrease |
Recurring | Spread | Level 3 | RMBS | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0062 | 0.0039 |
Recurring | Spread | Level 3 | RMBS | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0227 | 0.0229 |
Recurring | Spread | Level 3 | RMBS | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0138 | 0.0090 |
Recurring | Constant prepayment rate | Level 3 | RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impact of Increase in Input on Fair Value | Decrease [5] | Decrease [5] |
Recurring | Constant prepayment rate | Level 3 | RMBS | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.02 | 0.04 |
Recurring | Constant prepayment rate | Level 3 | RMBS | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.10 | 0.16 |
Recurring | Constant prepayment rate | Level 3 | RMBS | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.06 | 0.08 |
Recurring | Constant default rate | Level 3 | RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impact of Increase in Input on Fair Value | Decrease | Decrease |
Recurring | Constant default rate | Level 3 | RMBS | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | 0.01 |
Recurring | Constant default rate | Level 3 | RMBS | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.04 | 0.04 |
Recurring | Constant default rate | Level 3 | RMBS | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.02 | 0.03 |
Recurring | Loss severity | Level 3 | RMBS | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impact of Increase in Input on Fair Value | Decrease | Decrease |
Recurring | Loss severity | Level 3 | RMBS | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.10 | 0 |
Recurring | Loss severity | Level 3 | RMBS | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.65 | 1 |
Recurring | Loss severity | Level 3 | RMBS | Weighted average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.25 | 0.64 |
Fair Value Measurements - Sig_2
Fair Value Measurements - Significant Unobservable Inputs for Level 3 - Free-standing Derivatives (Details) - Level 3 $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Discounted cash flows | Interest rate swaps | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 3 | |
Discounted cash flows | Swap curve beyond 30 years | Interest rate swaps | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impact of Increase in Input on Fair Value | Decrease | |
Discounted cash flows | Swap curve beyond 30 years | Minimum | Interest rate swaps | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.02 | |
Discounted cash flows | Swap curve beyond 30 years | Maximum | Interest rate swaps | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.02 | |
Discounted cash flows | Swap curve beyond 30 years | Weighted Average | Interest rate swaps | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.02 | |
Option model | Equity options | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 65 | $ (195) |
Impact of Increase in Input on Fair Value | Increase | |
Option model | Interest rate swaptions | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ (3) | |
Impact of Increase in Input on Fair Value | Increase | |
Option model | Interest rate swaptions | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair Value | $ 97 | $ 7 |
Option model | Price volatility | Equity options | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impact of Increase in Input on Fair Value | Increase | |
Option model | Price volatility | Interest rate swaptions | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impact of Increase in Input on Fair Value | Increase | Increase |
Option model | Price volatility | Minimum | Equity options | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.18 | 0.17 |
Option model | Price volatility | Minimum | Interest rate swaptions | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | |
Option model | Price volatility | Minimum | Interest rate swaptions | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | 0.01 |
Option model | Price volatility | Maximum | Equity options | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.64 | 0.63 |
Option model | Price volatility | Maximum | Interest rate swaptions | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | |
Option model | Price volatility | Maximum | Interest rate swaptions | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | 0.01 |
Option model | Price volatility | Weighted Average | Equity options | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.26 | 0.28 |
Option model | Price volatility | Weighted Average | Interest rate swaptions | Interest rate derivatives | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | |
Option model | Price volatility | Weighted Average | Interest rate swaptions | Macro hedge program | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.01 | 0.01 |
Fair Value Measurements - Sig_3
Fair Value Measurements - Significant Unobservable Inputs for Level 3 - GMWB and FIA Embedded Derivatives (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Level 2 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Period of historical returns | 10 years | |
Withdrawal Utilization | Minimum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0% | 0% |
Withdrawal Utilization | Maximum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 100% | 100% |
Withdrawal Utilization | Weighted Average | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 62% | 62% |
Withdrawal Rates | Minimum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 4% | 4% |
Withdrawal Rates | Minimum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0% | 0% |
Withdrawal Rates | Maximum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 8% | 8% |
Withdrawal Rates | Maximum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 15.90% | 16% |
Withdrawal Rates | Weighted Average | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 6% | 6% |
Withdrawal Rates | Weighted Average | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 1.70% | 2% |
Lapse Rates | Minimum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0% | 0% |
Lapse Rates | Minimum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 1% | 1% |
Lapse Rates | Maximum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 40% | 48% |
Lapse Rates | Maximum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 25% | 34% |
Lapse Rates | Weighted Average | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 3% | 5% |
Lapse Rates | Weighted Average | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 6.50% | 6% |
Reset Elections | Minimum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0% | 0% |
Reset Elections | Maximum | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 99% | 99% |
Reset Elections | Weighted Average | Living Benefits Required to be Fair Valued and the GMWB Reinsurance Derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 10% | 8% |
Equity Volatility | Minimum | Other | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 18% | 11% |
Equity Volatility | Maximum | Other | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 28% | 25% |
Equity Volatility | Weighted Average | Other | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 23% | 21% |
Option Budgets | Minimum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0.50% | 1% |
Option Budgets | Maximum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 3.80% | 4% |
Option Budgets | Weighted Average | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 1.60% | 2% |
Credit Standing Adjustment | Minimum | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0.10% | 0% |
Credit Standing Adjustment | Minimum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0% | 0% |
Credit Standing Adjustment | Maximum | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0.30% | 0.20% |
Credit Standing Adjustment | Maximum | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0.20% | 0.10% |
Credit Standing Adjustment | Weighted Average | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0.30% | 0.10% |
Credit Standing Adjustment | Weighted Average | FIA embedded derivative | Level 3 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value unobservable input | 0.10% | 0.10% |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Hedge Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
NAV, redemption restriction percentage | 53% | 40% |
Private Equity Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
NAV, redemption restriction percentage | 0% | 0% |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Level 3 Roll Forward (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | |
Assets | |||
Assets, beginning balance | $ 1,025 | $ 878 | $ 1,342 |
Assets, gain (loss) included in net income | 17 | (19) | |
Assets, gain (loss) included in OCI | (4) | (3) | |
Assets, purchases | 599 | 292 | |
Assets, settlements | (177) | (97) | |
Assets, sales | (35) | (28) | |
Assets, Transfers into level 3 | 5 | 57 | |
Assets, Transfers out of level 3 | (88) | (55) | |
Assets, ending balance | 1,342 | 1,025 | |
(Liabilities) | |||
Liability, beginning balance | (160) | (420) | (763) |
Liability, gain (loss) included in net income | 182 | 467 | |
Liability, gain (loss) included in OCI | 0 | 0 | |
Liability, purchases | (656) | 12 | |
Liability, settlements | (129) | (219) | |
Liability, ending balance | (763) | (160) | |
Level 3 | |||
Assets | |||
Assets, beginning balance | 1,154 | ||
Assets, gain (loss) included in net income | 57 | ||
Assets, gain (loss) included in OCI | (74) | ||
Assets, purchases | 1,789 | ||
Assets, settlements | (620) | ||
Assets, sales | (52) | ||
Assets, Transfers into level 3 | 20 | ||
Assets, Transfers out of level 3 | (274) | ||
Assets, ending balance | 1,154 | 2,000 | |
(Liabilities) | |||
Liability, beginning balance | (575) | ||
Liability, gain (loss) included in net income | 344 | ||
Liability, gain (loss) included in OCI | 0 | ||
Liability, purchases | (50) | ||
Liability, settlements | (10) | ||
Liability, sales | 0 | 0 | 0 |
Liability, transfer into Level 3 | 0 | 0 | 0 |
Liability, transfer out of Level 3 | 0 | 0 | 0 |
Liability, ending balance | (575) | (291) | |
Level 3 | Reinsurance recoverable for FIA options | |||
Freestanding derivatives | |||
Fair value, beginning balance | 0 | ||
Gain (loss) included in net income | (22) | ||
Gain (loss) included in OCI | 0 | ||
Purchases | 123 | ||
Settlements | (52) | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair value, ending balance | 0 | 49 | |
Level 3 | Reinsurance recoverable for GMWB | |||
Freestanding derivatives | |||
Fair value, beginning balance | (6) | 7 | (8) |
Gain (loss) included in net income | (8) | (19) | |
Gain (loss) included in OCI | 0 | 0 | |
Purchases | 0 | ||
Settlements | 6 | 6 | |
Sales | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair value, ending balance | (8) | (6) | |
Level 3 | Assets | Reinsurance recoverable for FIA embedded derivative | |||
Freestanding derivatives | |||
Fair value, beginning balance | 0 | ||
Gain (loss) included in net income | 0 | ||
Gain (loss) included in OCI | 0 | ||
Purchases | 288 | ||
Settlements | 0 | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair value, ending balance | 0 | 288 | |
Level 3 | Assets | Reinsurance recoverable for GMWB | |||
Freestanding derivatives | |||
Fair value, beginning balance | (8) | ||
Gain (loss) included in net income | (14) | ||
Gain (loss) included in OCI | 0 | ||
Purchases | 0 | ||
Settlements | (109) | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair value, ending balance | (8) | (131) | |
Level 3 | Liability | Reinsurance recoverable for FIA embedded derivative | |||
Freestanding derivatives | |||
Fair value, beginning balance | 0 | (655) | |
Gain (loss) included in net income | 0 | 256 | |
Gain (loss) included in OCI | 0 | 0 | |
Purchases | (655) | (13) | |
Settlements | 0 | 27 | |
Sales | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair value, ending balance | (655) | (385) | |
Level 3 | Liability | Reinsurance recoverable for GMWB | |||
Freestanding derivatives | |||
Fair value, beginning balance | 80 | ||
Gain (loss) included in net income | 88 | ||
Gain (loss) included in OCI | 0 | ||
Purchases | 0 | ||
Settlements | (37) | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair value, ending balance | 80 | 131 | |
Level 3 | Liability | Funds withheld liability | |||
Freestanding derivatives | |||
Fair value, beginning balance | 0 | ||
Gain (loss) included in net income | 0 | ||
Gain (loss) included in OCI | 0 | ||
Purchases | (37) | ||
Settlements | 0 | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair value, ending balance | 0 | (37) | |
Level 3 | Liability | |||
(Liabilities) | |||
Liability, beginning balance | 77 | 21 | (575) |
Liability, gain (loss) included in net income | 29 | 82 | 344 |
Liability, gain (loss) included in OCI | 0 | 0 | 0 |
Liability, purchases | (655) | 0 | (13) |
Liability, settlements | (26) | (26) | (10) |
Liability, sales | 0 | 0 | 0 |
Liability, transfer into Level 3 | 0 | 0 | 0 |
Liability, transfer out of Level 3 | 0 | 0 | 0 |
Liability, ending balance | (575) | 77 | (254) |
Level 3 | GMWB embedded derivative | |||
(Liabilities) | |||
Liability, beginning balance | 77 | 21 | 80 |
Liability, gain (loss) included in net income | 29 | 82 | |
Liability, gain (loss) included in OCI | 0 | 0 | |
Liability, purchases | 0 | 0 | |
Liability, settlements | (26) | (26) | |
Liability, sales | 0 | 0 | |
Liability, transfer into Level 3 | 0 | 0 | |
Liability, transfer out of Level 3 | 0 | 0 | |
Liability, ending balance | 80 | 77 | |
Level 3 | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 967 | 795 | 1,175 |
Assets, gain (loss) included in net income | 3 | 0 | (2) |
Assets, gain (loss) included in OCI | (4) | (3) | (74) |
Assets, purchases | 444 | 287 | 359 |
Assets, settlements | (124) | (93) | (257) |
Assets, sales | (30) | (24) | (29) |
Assets, Transfers into level 3 | 1 | 55 | 20 |
Assets, Transfers out of level 3 | (82) | (50) | (124) |
Assets, ending balance | 1,175 | 967 | 1,068 |
Level 3 | Fixed Maturities, FVO | |||
Assets | |||
Assets, beginning balance | 0 | ||
Assets, gain (loss) included in net income | (21) | ||
Assets, gain (loss) included in OCI | 0 | ||
Assets, purchases | 327 | ||
Assets, settlements | 0 | ||
Assets, sales | 0 | ||
Assets, Transfers into level 3 | 0 | ||
Assets, Transfers out of level 3 | 0 | ||
Assets, ending balance | 0 | 306 | |
Level 3 | Equity securities, at fair value | |||
Assets | |||
Assets, beginning balance | 33 | 32 | 21 |
Assets, gain (loss) included in net income | 20 | 0 | 6 |
Assets, gain (loss) included in OCI | 0 | 0 | 0 |
Assets, purchases | 0 | 1 | 8 |
Assets, settlements | (32) | 0 | (11) |
Assets, sales | 0 | 0 | 0 |
Assets, Transfers into level 3 | 0 | 0 | 0 |
Assets, Transfers out of level 3 | 0 | 0 | 0 |
Assets, ending balance | 21 | 33 | 24 |
Level 3 | Limited partnerships and other alternative investments | |||
Assets | |||
Assets, beginning balance | 0 | ||
Assets, gain (loss) included in net income | 16 | ||
Assets, gain (loss) included in OCI | 0 | ||
Assets, purchases | 42 | ||
Assets, settlements | 0 | ||
Assets, sales | 0 | ||
Assets, Transfers into level 3 | 0 | ||
Assets, Transfers out of level 3 | 0 | ||
Assets, ending balance | 0 | 58 | |
Level 3 | ABS | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 8 | 0 | 0 |
Assets, gain (loss) included in net income | 0 | 0 | 0 |
Assets, gain (loss) included in OCI | 0 | 0 | (2) |
Assets, purchases | 0 | 10 | 52 |
Assets, settlements | 0 | 0 | (6) |
Assets, sales | 0 | 0 | 0 |
Assets, Transfers into level 3 | 0 | 0 | 0 |
Assets, Transfers out of level 3 | (8) | (2) | (3) |
Assets, ending balance | 0 | 8 | 41 |
Level 3 | CLOs | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 248 | 259 | 159 |
Assets, gain (loss) included in net income | 0 | 0 | 0 |
Assets, gain (loss) included in OCI | 0 | 0 | (1) |
Assets, purchases | 34 | 50 | 80 |
Assets, settlements | (64) | (36) | (54) |
Assets, sales | 0 | 0 | 0 |
Assets, Transfers into level 3 | 0 | 0 | 0 |
Assets, Transfers out of level 3 | (59) | (25) | (75) |
Assets, ending balance | 159 | 248 | 109 |
Level 3 | CMBS | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 143 | 54 | 276 |
Assets, gain (loss) included in net income | 0 | 0 | 0 |
Assets, gain (loss) included in OCI | (2) | 2 | (26) |
Assets, purchases | 136 | 90 | 68 |
Assets, settlements | (1) | 0 | (34) |
Assets, sales | 0 | 0 | 0 |
Assets, Transfers into level 3 | 0 | 2 | 0 |
Assets, Transfers out of level 3 | 0 | (5) | (7) |
Assets, ending balance | 276 | 143 | 277 |
Level 3 | Corporate | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 460 | 328 | 665 |
Assets, gain (loss) included in net income | 3 | 0 | (2) |
Assets, gain (loss) included in OCI | (2) | (6) | (43) |
Assets, purchases | 245 | 132 | 132 |
Assets, settlements | (30) | (23) | (137) |
Assets, sales | (11) | (9) | (10) |
Assets, Transfers into level 3 | 0 | 53 | 20 |
Assets, Transfers out of level 3 | 0 | (15) | (6) |
Assets, ending balance | 665 | 460 | 619 |
Level 3 | Foreign governments | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 0 | ||
Assets, gain (loss) included in net income | 0 | ||
Assets, gain (loss) included in OCI | (1) | ||
Assets, purchases | 5 | ||
Assets, settlements | 0 | ||
Assets, sales | 0 | ||
Assets, Transfers into level 3 | 0 | ||
Assets, Transfers out of level 3 | 0 | ||
Assets, ending balance | 0 | 4 | |
Level 3 | Municipal | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 0 | 1 | |
Assets, gain (loss) included in net income | 0 | 0 | |
Assets, gain (loss) included in OCI | 0 | 0 | |
Assets, purchases | 0 | 0 | |
Assets, settlements | 0 | 0 | |
Assets, sales | 0 | 0 | |
Assets, Transfers into level 3 | 1 | 0 | |
Assets, Transfers out of level 3 | 0 | 0 | |
Assets, ending balance | 1 | 1 | |
Level 3 | RMBS | Fixed maturities, AFS | |||
Assets | |||
Assets, beginning balance | 108 | 154 | 74 |
Assets, gain (loss) included in net income | 0 | 0 | 0 |
Assets, gain (loss) included in OCI | 0 | 1 | (1) |
Assets, purchases | 29 | 5 | 22 |
Assets, settlements | (29) | (34) | (26) |
Assets, sales | (19) | (15) | (19) |
Assets, Transfers into level 3 | 0 | 0 | 0 |
Assets, Transfers out of level 3 | (15) | (3) | (33) |
Assets, ending balance | 74 | 108 | 17 |
Level 3 | Short-term investments | |||
Assets | |||
Assets, beginning balance | 14 | 22 | 75 |
Assets, gain (loss) included in net income | 0 | 0 | 0 |
Assets, gain (loss) included in OCI | 0 | 0 | 0 |
Assets, purchases | 88 | 2 | 192 |
Assets, settlements | (27) | (10) | (80) |
Assets, sales | 0 | 0 | 0 |
Assets, Transfers into level 3 | 0 | 0 | 0 |
Assets, Transfers out of level 3 | 0 | 0 | (50) |
Assets, ending balance | 75 | 14 | 137 |
Level 3 | Derivative | |||
Freestanding derivatives | |||
Fair value, beginning balance | (188) | ||
Gain (loss) included in net income | 96 | ||
Gain (loss) included in OCI | 0 | ||
Purchases | 351 | ||
Settlements | (111) | ||
Sales | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair value, ending balance | (188) | 148 | |
Level 3 | Derivative | Interest rate derivatives | |||
Freestanding derivatives | |||
Fair value, beginning balance | 2 | 2 | 0 |
Gain (loss) included in net income | 2 | 0 | 22 |
Gain (loss) included in OCI | 0 | 0 | 0 |
Purchases | (4) | 0 | 0 |
Settlements | 0 | 0 | (22) |
Sales | 0 | 0 | 0 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Fair value, ending balance | 0 | 2 | 0 |
Level 3 | Derivative | Macro hedge program | |||
Freestanding derivatives | |||
Fair value, beginning balance | (237) | (441) | (188) |
Gain (loss) included in net income | 153 | 385 | 74 |
Gain (loss) included in OCI | 0 | 0 | 0 |
Purchases | (1) | 12 | 351 |
Settlements | (103) | (193) | (89) |
Sales | 0 | 0 | 0 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Fair value, ending balance | (188) | (237) | 148 |
Level 3 | Separate account asset (liability) | |||
Assets | |||
Assets, beginning balance | 15 | 20 | 79 |
Assets, gain (loss) included in net income | 0 | 0 | (2) |
Assets, gain (loss) included in OCI | 0 | 0 | 0 |
Assets, purchases | 71 | 2 | 99 |
Assets, settlements | 0 | 0 | 0 |
Assets, sales | (5) | (4) | (23) |
Assets, Transfers into level 3 | 4 | 2 | 0 |
Assets, Transfers out of level 3 | (6) | (5) | (100) |
Assets, ending balance | $ 79 | $ 15 | $ 53 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments Classified as Level 3 Still Held at Year End (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | $ (6) | $ (59) | $ (6) |
Liabilities, unrealized gains (losses) related to equity securities still held | (34) | (39) | 357 |
Level 3 | Assets | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivatives, unrealized gains (losses) related to equity securities still held | 2 | (40) | 39 |
Level 3 | (Liabilities) | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivatives, unrealized gains (losses) related to equity securities still held | (63) | (121) | 0 |
Level 3 | Contract Holder Funds | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Liabilities, unrealized gains (losses) related to equity securities still held | 29 | 82 | 357 |
Level 3 | Contract Holder Funds | GMWB embedded derivative | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Liabilities, unrealized gains (losses) related to equity securities still held | 29 | 82 | 101 |
Level 3 | Interest rate derivatives | Assets | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivatives, unrealized gains (losses) related to equity securities still held | 2 | (40) | (3) |
Level 3 | Macro hedge program | Assets | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivatives, unrealized gains (losses) related to equity securities still held | 0 | 0 | 42 |
Level 3 | Macro hedge program | (Liabilities) | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivatives, unrealized gains (losses) related to equity securities still held | (63) | (121) | 0 |
Level 3 | Reinsurance recoverable for FIA options | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (22) |
Level 3 | Reinsurance recoverable for GMWB | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | (8) | (19) | (14) |
Level 3 | Fixed maturities, AFS | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (2) |
Level 3 | Corporate | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (2) |
Level 3 | Fixed maturities, at fair value using fair value option | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (21) |
Level 3 | Equity securities, at fair value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | 0 |
Level 3 | Limited partnerships and other alternative investments | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | 16 |
Level 3 | Separate account asset (liability) | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (2) |
Level 3 | FIA embedded derivative | Contract Holder Funds | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Liabilities, unrealized gains (losses) related to equity securities still held | 0 | 0 | 256 |
OCI | Level 3 | Fixed maturities, AFS | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | (4) | 0 | (74) |
OCI | Level 3 | ABS | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (2) |
OCI | Level 3 | CLOs | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | 0 | 0 | (1) |
OCI | Level 3 | CMBS | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | (2) | 3 | (26) |
OCI | Level 3 | Corporate | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | (2) | (4) | (43) |
OCI | Level 3 | RMBS | Fixed Maturities, FVO | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, unrealized gains (losses) related to equity securities still held | $ 0 | $ 1 | $ (2) |
Fair Value Measurements - Fin_2
Fair Value Measurements - Financial Instruments Not Carried At Fair Value (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2021 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets | $ 153,111 | $ 176,364 | |
Liabilities | 152,497 | 174,211 | |
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 10,485 | 6,379 | |
Mortgage loans, allowance for credit loss | 15 | 12 | $ 11 |
Carrying amount | Level 3 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 11,967 | 6,379 | |
Carrying amount | Level 3 | Other policyholder funds and benefits payable | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Liabilities | 4,834 | 5,137 | |
Carrying amount | Level 3 | Policy loans | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets | 1,495 | 1,484 | |
Carrying amount | Level 3 | Mortgage loan | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets | 2,520 | 2,131 | |
Estimate of fair value | Level 3 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 11,967 | 6,379 | |
Estimate of fair value | Level 3 | Other policyholder funds and benefits payable | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Liabilities, fair value | 4,271 | 4,792 | |
Estimate of fair value | Level 3 | Policy loans | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, fair value | 1,495 | 1,484 | |
Estimate of fair value | Level 3 | Mortgage loan | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Assets, fair value | $ 2,232 | $ 2,138 |
Investments - Investment Income
Investments - Investment Income (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Net Investment Income [Line Items] | ||||
Other | $ 1 | $ 1 | $ (146) | $ 13 |
Investment expense | (14) | (13) | (30) | (26) |
Net investment income | 498 | 534 | 778 | 816 |
Fixed Maturities, FVO | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 174 | 243 | 620 | 518 |
Equity securities, at fair value | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 10 | 2 | 10 | 7 |
Mortgage loan | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 32 | 45 | 74 | 92 |
Policy loans | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 36 | 40 | 82 | 82 |
Limited partnerships and other alternative investments | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | $ 259 | $ 216 | $ 168 | $ 130 |
Investments - Net Realized Capi
Investments - Net Realized Capital Gains and Sale of AFS (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Gain (Loss) on Securities [Line Items] | ||||
Gross gains on sales | $ 14 | $ 55 | $ 2 | $ 166 |
Gross losses on sales | (20) | (8) | (532) | (32) |
Net realized gains (losses) on sales of equity securities | 19 | 0 | 5 | 0 |
Change in net unrealized gains (losses) on equity securities | (2) | 0 | (24) | 1 |
Net credit losses on fixed maturities, AFS | 0 | 0 | (1) | (1) |
Intent-to-sell impairments | 0 | 0 | 0 | (6) |
Transactional foreign currency revaluation | 0 | 0 | 0 | 3 |
Net realized capital gains (losses) | (20) | (242) | 317 | (74) |
Assets, unrealized gains (losses) related to equity securities still held | (6) | (59) | (6) | |
Fixed maturities, available-for-sale | 2,976 | 1,622 | 6,185 | 2,824 |
Not Designated as Hedging Instrument | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | (25) | (299) | 1,109 | (187) |
Not Designated as Hedging Instrument | Other | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | 37 | (54) | 833 | 149 |
FIA embedded derivative | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | 270 | |||
FIA hedging program | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | (247) | |||
GMWB derivatives, net | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | 82 | |||
Macro hedge program | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | (67) | (243) | (1) | (414) |
Macro hedge program | Not Designated as Hedging Instrument | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | (100) | (301) | (1) | (414) |
Foreign currency swaps and forwards | Not Designated as Hedging Instrument | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | 5 | (2) | 7 | (7) |
Modified Coinsurance Reinsurance Contract | Not Designated as Hedging Instrument | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gain (loss) on derivatives | 15 | 22 | 1,136 | (50) |
Other investments | ||||
Gain (Loss) on Securities [Line Items] | ||||
Other, net | 16 | (72) | (290) | 192 |
Mortgage loan | ||||
Gain (Loss) on Securities [Line Items] | ||||
Current period provision (release) | 0 | 6 | (3) | (8) |
Fixed Maturities, FVO | ||||
Gain (Loss) on Securities [Line Items] | ||||
Gross gains on sales | 14 | 55 | 2 | 165 |
Gross losses on sales | (16) | (8) | (531) | (31) |
Change in fair value, FVO | (21) | |||
Fixed maturities, available-for-sale | 2,372 | 1,007 | 5,897 | 1,789 |
Limited partnerships and other alternative investments | ||||
Gain (Loss) on Securities [Line Items] | ||||
Change in fair value, FVO | 16 | |||
Equity securities, at fair value | ||||
Gain (Loss) on Securities [Line Items] | ||||
Assets, unrealized gains (losses) related to equity securities still held | $ (3) | $ 1 | $ (24) | $ 4 |
Investments - Narrative (Detail
Investments - Narrative (Details) | 6 Months Ended | 12 Months Ended | ||||
Dec. 31, 2021 USD ($) | Dec. 31, 2021 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2022 USD ($) security | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Net Investment Income [Line Items] | ||||||
Fixed maturities, AFS, accrued interest | $ 178,000,000 | $ 178,000,000 | $ 183,000,000 | $ 178,000,000 | ||
Mortgage loans, accrued interest receivable | 6,000,000 | 6,000,000 | $ 8,000,000 | $ 6,000,000 | ||
Concentration Risk, Benchmark Description | greater than 10% of the Company's stockholders' equity | greater than 10% of the Company's stockholders' equity | ||||
Unrealized loss position, number of position | security | 4,426 | |||||
Gross unrealized losses depressed less than 20% of cost or amortized cost | 57% | |||||
Mortgage loan, ACL projection period | 10 years | |||||
Financing receivable, held-for-sale | 0 | 0 | $ 0 | |||
Modifications, number of contracts | 0 | |||||
Current weighted average loan to value ratio of commercial mortgage loan | 62% | |||||
Original weighted average loan to value ratio of commercial mortgage loan | 53% | |||||
Principal amount of delinquent loans | 0 | 0 | 0 | |||
Purchased with credit deterioration, amount at purchase price | $ 0 | 0 | ||||
Maximum loss exposure, amount | 0 | 0 | 0 | |||
Comparison of carrying amount of assets and liabilities to maximum loss exposure | 1,100,000,000 | 1,100,000,000 | 1,300,000,000 | 1,100,000,000 | ||
Commitments by third parties | 419,000,000 | 419,000,000 | 410,000,000 | 419,000,000 | ||
Interest-bearing deposit liabilities, domestic | 26,000,000 | 26,000,000 | 20,000,000 | 26,000,000 | ||
Equity method investments | $ 1,300,000,000 | |||||
Aggregate investment loss percentage of company's pre tax consolidated net income minimum | 10% | |||||
Assets | 176,364,000,000 | 176,364,000,000 | $ 153,111,000,000 | 176,364,000,000 | ||
Liabilities | 174,211,000,000 | 174,211,000,000 | 152,497,000,000 | 174,211,000,000 | ||
Net investment income | 498,000,000 | $ 534,000,000 | 778,000,000 | $ 816,000,000 | ||
Net income | 280,000,000 | 280,000,000 | 186,000,000 | $ 617,000,000 | 399,000,000 | |
Minimum | ||||||
Net Investment Income [Line Items] | ||||||
Mortgage loan, ACL projection period, specific modeled economic scenario | 2 years | |||||
Maximum | ||||||
Net Investment Income [Line Items] | ||||||
Mortgage loan, ACL projection period, specific modeled economic scenario | 4 years | |||||
Limited Partner | ||||||
Net Investment Income [Line Items] | ||||||
Outstanding commitments to fund limited partnership and other alternative investments | $ 410,000,000 | |||||
Assets | 171,100,000,000 | 171,100,000,000 | 172,700,000,000 | 171,100,000,000 | ||
Liabilities | 30,800,000,000 | $ 30,800,000,000 | 28,600,000,000 | 30,800,000,000 | ||
Net investment income | 1,900,000,000 | 2,000,000,000 | 1,000,000,000 | |||
Net income | 4,700,000,000 | $ 31,400,000,000 | 5,900,000,000 | |||
Mortgage loan | ||||||
Net Investment Income [Line Items] | ||||||
Principal amount of delinquent loans | 0 | |||||
Fixed Income Funds | Primary Beneficiary | ||||||
Net Investment Income [Line Items] | ||||||
Maximum loss exposure, amount | 0 | |||||
Limited partnerships and other alternative investments | ||||||
Net Investment Income [Line Items] | ||||||
Gross investment income | $ 259,000,000 | $ 216,000,000 | 168,000,000 | $ 130,000,000 | ||
Commercial loan | ||||||
Net Investment Income [Line Items] | ||||||
Financing receivable, held-for-sale | $ 0 |
Investments - Fair Value Concen
Investments - Fair Value Concentration Risk (Details) - Investments - Credit Concentration Risk $ in Millions | Dec. 31, 2022 USD ($) |
Pacific Investment Management LLC | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | $ 347 |
Madison Capital Funding | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 195 |
Harbourvest | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 131 |
Bank of America | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 121 |
Twin Brook Capital Partners | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 104 |
Oracle Corporation | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 95 |
Whitehorse Liquidity Partners | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 91 |
Mitsubishi UFJ Financial Group | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 90 |
Citigroup | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 88 |
Mizuho Financial Group | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 87 |
J.P. Morgan & Co. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 85 |
International Business Machines Corporation | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 84 |
Boeing Company | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 82 |
Goldman Sachs Group, Inc. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 75 |
Wells Fargo & Company | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 74 |
Sumitomo Mitsui Financial Group | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 73 |
UnitedHealth Group Inc. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 70 |
Walt Disney Company | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 70 |
Strategic Partners VIII L.P. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 69 |
T-Mobile US, Inc | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 69 |
Deutsche Telekom International Finance B.V. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 66 |
Amgen Inc. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 65 |
Gridiron Capital Fund III LP | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 65 |
ING Group | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | 63 |
Strategic Partners Touchdown Holdings L.P. | |
Investment Holdings [Line Items] | |
Concentration of risk, investments | $ 62 |
Investments - AFS Securities (D
Investments - AFS Securities (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | $ 0 | $ 1 | $ 0 |
Credit losses on fixed maturities where an allowance was not previously recorded | 0 | 0 | 1 |
Write-offs charged against the allowance | (1) | ||
ACL, ending balance | 0 | 1 | 0 |
Available-for-sale, amortized cost | 20,986 | 18,689 | |
Allowance for credit loss | 0 | $ 1 | 0 |
Gross Unrealized Gains | 93 | 3 | |
Gross Unrealized Losses | (108) | (3,309) | |
Fixed maturities, AFS | 20,971 | 15,383 | |
Amortized Cost | |||
One year or less | 341 | 445 | |
Over one year through five years | 2,904 | 2,392 | |
Over five years through ten years | 5,248 | 4,438 | |
Over ten years | 8,125 | 8,209 | |
Subtotal | 16,618 | 15,484 | |
Mortgage-backed, CLOs and ABS | 4,368 | 3,205 | |
Available-for-sale, amortized cost | 20,986 | 18,689 | |
Fair Value | |||
One year or less | 341 | 437 | |
Over one year through five years | 2,890 | 2,214 | |
Over five years through ten years | 5,241 | 3,732 | |
Over ten years | 8,151 | 6,140 | |
Subtotal | 16,623 | 12,523 | |
Mortgage-backed, CLOs and ABS | 4,348 | 2,860 | |
Fixed maturities, AFS | 20,971 | 15,383 | |
Fixed maturities, AFS | |||
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 9,016 | 10,249 | |
AFS, Less Than 12 Months, Unrealized Losses | (108) | (2,251) | |
AFS, 12 Months or More, Fair Value | 0 | 4,931 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (1,058) | |
AFS, Fair Value | 9,016 | 15,180 | |
AFS, Unrealized Losses | (108) | (3,309) | |
ABS | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 260 | 276 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | (2) | (22) | |
Fixed maturities, AFS | 258 | 254 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 260 | 276 | |
Fair Value | |||
Fixed maturities, AFS | 258 | 254 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 252 | 96 | |
AFS, Less Than 12 Months, Unrealized Losses | (2) | (5) | |
AFS, 12 Months or More, Fair Value | 0 | 162 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (17) | |
AFS, Fair Value | 252 | 258 | |
AFS, Unrealized Losses | (2) | (22) | |
CLOs | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 945 | 703 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | (1) | (27) | |
Fixed maturities, AFS | 944 | 676 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 945 | 703 | |
Fair Value | |||
Fixed maturities, AFS | 944 | 676 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 751 | 644 | |
AFS, Less Than 12 Months, Unrealized Losses | (1) | (27) | |
AFS, 12 Months or More, Fair Value | 0 | 11 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | 0 | |
AFS, Fair Value | 751 | 655 | |
AFS, Unrealized Losses | (1) | (27) | |
CMBS | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 2,345 | 1,724 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 4 | 1 | |
Gross Unrealized Losses | (14) | (211) | |
Fixed maturities, AFS | 2,335 | 1,514 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 2,345 | 1,724 | |
Fair Value | |||
Fixed maturities, AFS | 2,335 | 1,514 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 961 | 819 | |
AFS, Less Than 12 Months, Unrealized Losses | (14) | (102) | |
AFS, 12 Months or More, Fair Value | 0 | 682 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (109) | |
AFS, Fair Value | 961 | 1,501 | |
AFS, Unrealized Losses | (14) | (211) | |
Corporate | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 13,380 | 12,565 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 50 | 2 | |
Gross Unrealized Losses | (73) | (2,326) | |
Fixed maturities, AFS | 13,357 | 10,241 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 13,380 | 12,565 | |
Fair Value | |||
Fixed maturities, AFS | 13,357 | 10,241 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 5,788 | 6,659 | |
AFS, Less Than 12 Months, Unrealized Losses | (73) | (1,544) | |
AFS, 12 Months or More, Fair Value | 0 | 3,412 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (782) | |
AFS, Fair Value | 5,788 | 10,071 | |
AFS, Unrealized Losses | (73) | (2,326) | |
Foreign governments | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 365 | 377 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 1 | 0 | |
Gross Unrealized Losses | (4) | (62) | |
Fixed maturities, AFS | 362 | 315 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 365 | 377 | |
Fair Value | |||
Fixed maturities, AFS | 362 | 315 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 173 | 185 | |
AFS, Less Than 12 Months, Unrealized Losses | (4) | (41) | |
AFS, 12 Months or More, Fair Value | 0 | 128 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (21) | |
AFS, Fair Value | 173 | 313 | |
AFS, Unrealized Losses | (4) | (62) | |
Municipal bonds | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 1,452 | 1,309 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 10 | 0 | |
Gross Unrealized Losses | (6) | (269) | |
Fixed maturities, AFS | 1,456 | 1,040 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 1,452 | 1,309 | |
Fair Value | |||
Fixed maturities, AFS | 1,456 | 1,040 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 337 | 859 | |
AFS, Less Than 12 Months, Unrealized Losses | (6) | (219) | |
AFS, 12 Months or More, Fair Value | 0 | 180 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (50) | |
AFS, Fair Value | 337 | 1,039 | |
AFS, Unrealized Losses | (6) | (269) | |
RMBS | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 818 | 503 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | (7) | (86) | |
Fixed maturities, AFS | 811 | 417 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 818 | 503 | |
Fair Value | |||
Fixed maturities, AFS | 811 | 417 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 537 | 123 | |
AFS, Less Than 12 Months, Unrealized Losses | (7) | (20) | |
AFS, 12 Months or More, Fair Value | 0 | 293 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (66) | |
AFS, Fair Value | 537 | 416 | |
AFS, Unrealized Losses | (7) | (86) | |
U.S. Treasuries | |||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |||
ACL, beginning balance | 0 | ||
ACL, ending balance | 0 | 0 | |
Available-for-sale, amortized cost | 1,421 | 1,232 | |
Allowance for credit loss | 0 | 0 | |
Gross Unrealized Gains | 28 | 0 | |
Gross Unrealized Losses | (1) | (306) | |
Fixed maturities, AFS | 1,448 | 926 | |
Amortized Cost | |||
Available-for-sale, amortized cost | 1,421 | 1,232 | |
Fair Value | |||
Fixed maturities, AFS | 1,448 | 926 | |
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss [Abstract] | |||
AFS, Less Than 12 Months, Fair Value | 217 | 864 | |
AFS, Less Than 12 Months, Unrealized Losses | (1) | (293) | |
AFS, 12 Months or More, Fair Value | 0 | 63 | |
AFS, Less Than 12 Months, Unrealized Losses | 0 | (13) | |
AFS, Fair Value | 217 | 927 | |
AFS, Unrealized Losses | $ (1) | $ (306) |
Investments - ACL on Mortgage L
Investments - ACL on Mortgage Loans (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | $ 12 | |||
Ending balance | $ 12 | $ 11 | 15 | |
Commercial loan | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | 0 | 17 | 12 | $ 0 |
Change in ACL on mortgage loans | 0 | (6) | 3 | 8 |
Ending balance | 12 | 15 | 17 | |
Cumulative effect of accounting changes, net of tax | Accounting Standards Update 2016-13 | Commercial loan | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | 12 | 9 | ||
Adjusted balance | Commercial loan | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | 12 | $ 17 | $ 12 | 9 |
Ending balance | $ 12 | $ 17 |
Investments - Mortgage Loans by
Investments - Mortgage Loans by Origination, Region and Property Type (Details) $ in Millions | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jul. 01, 2021 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2019 USD ($) |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, allowance for credit loss | $ 15 | $ 12 | $ 11 | |||
Commercial loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, allowance for credit loss | 15 | 12 | $ 0 | $ 17 | $ 0 | |
Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Amortized cost, current year | $ 525 | $ 385 | ||||
Average DSCR, current year | 2.45 | 2.68 | ||||
Amortized cost, one year before current | $ 400 | $ 178 | ||||
Average DSCR, one year before current year | 2.74 | 2.45 | ||||
Amortized cost, two years before current | $ 180 | $ 259 | ||||
Average DSCR, two years before current year | 2.66 | 2.76 | ||||
Amortized cost, three years before current | $ 247 | $ 313 | ||||
Average DSCR, three years before current year | 2.83 | 1.86 | ||||
Amortized cost, four years before current | $ 297 | $ 276 | ||||
Average DSCR, four years before current year | 1.80 | 2.22 | ||||
Amortized cost, more than five years before current | $ 886 | $ 732 | ||||
Average DSCR, more than five years before current year | 2.64 | 2.47 | ||||
Amortized cost | $ 2,535 | $ 2,143 | ||||
Average DSCR | 2.55 | 2.42 | ||||
Mortgage loans, allowance for credit loss | $ 12 | |||||
Mortgage loans, amortized cost | $ 2,535 | $ 2,143 | ||||
Investment owned, percent of total | 100% | 100% | ||||
Industrial | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 787 | $ 711 | ||||
Investment owned, percent of total | 31% | 33.20% | ||||
Multifamily | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 669 | $ 590 | ||||
Investment owned, percent of total | 26.40% | 27.50% | ||||
Office | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 383 | $ 423 | ||||
Investment owned, percent of total | 15.10% | 19.70% | ||||
Retail | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 443 | $ 403 | ||||
Investment owned, percent of total | 17.50% | 18.80% | ||||
Single Family | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 253 | $ 16 | ||||
Investment owned, percent of total | 10% | 0.80% | ||||
East North Central | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 74 | $ 78 | ||||
Investment owned, percent of total | 2.90% | 3.60% | ||||
East South Central | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 32 | $ 20 | ||||
Investment owned, percent of total | 1.30% | 0.90% | ||||
Middle Atlantic | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 194 | $ 152 | ||||
Investment owned, percent of total | 7.70% | 7.10% | ||||
Mountain | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 185 | $ 142 | ||||
Investment owned, percent of total | 7.30% | 6.60% | ||||
New England | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 82 | $ 87 | ||||
Investment owned, percent of total | 3.20% | 4.10% | ||||
Pacific | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 535 | $ 559 | ||||
Investment owned, percent of total | 21.10% | 26.10% | ||||
South Atlantic | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 694 | $ 627 | ||||
Investment owned, percent of total | 27.40% | 29.30% | ||||
West South Central | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 180 | $ 184 | ||||
Investment owned, percent of total | 7.10% | 8.60% | ||||
Other | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Mortgage loans, amortized cost | $ 559 | $ 294 | ||||
Investment owned, percent of total | 22% | 13.70% | ||||
Greater than 80% | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Amortized cost, current year | $ 54 | |||||
Average DSCR, current year | 0 | |||||
Amortized cost, one year before current | $ 0 | |||||
Average DSCR, one year before current year | 0 | |||||
Amortized cost, two years before current | $ 0 | |||||
Average DSCR, two years before current year | 0 | |||||
Amortized cost, three years before current | $ 0 | |||||
Average DSCR, three years before current year | 0 | |||||
Amortized cost, four years before current | $ 0 | |||||
Average DSCR, four years before current year | 0 | |||||
Amortized cost, more than five years before current | $ 41 | |||||
Average DSCR, more than five years before current year | 2.09 | |||||
Amortized cost | $ 95 | |||||
Average DSCR | 2.09 | |||||
65% - 80% | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Amortized cost, current year | $ 10 | $ 7 | ||||
Average DSCR, current year | 2.02 | 2.37 | ||||
Amortized cost, one year before current | $ 21 | $ 18 | ||||
Average DSCR, one year before current year | 2.51 | 2.62 | ||||
Amortized cost, two years before current | $ 14 | $ 25 | ||||
Average DSCR, two years before current year | 2.79 | 1.55 | ||||
Amortized cost, three years before current | $ 27 | $ 43 | ||||
Average DSCR, three years before current year | 2.08 | 1 | ||||
Amortized cost, four years before current | $ 116 | $ 41 | ||||
Average DSCR, four years before current year | 1.28 | 1.94 | ||||
Amortized cost, more than five years before current | $ 60 | $ 37 | ||||
Average DSCR, more than five years before current year | 1.77 | 1.23 | ||||
Amortized cost | $ 248 | $ 171 | ||||
Average DSCR | 1.71 | 1.60 | ||||
Less than 65% | Mortgage loan | ||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | ||||||
Amortized cost, current year | $ 461 | $ 378 | ||||
Average DSCR, current year | 2.47 | 2.68 | ||||
Amortized cost, one year before current | $ 379 | $ 160 | ||||
Average DSCR, one year before current year | 2.76 | 2.43 | ||||
Amortized cost, two years before current | $ 166 | $ 234 | ||||
Average DSCR, two years before current year | 2.65 | 2.89 | ||||
Amortized cost, three years before current | $ 220 | $ 270 | ||||
Average DSCR, three years before current year | 2.92 | 2 | ||||
Amortized cost, four years before current | $ 181 | $ 235 | ||||
Average DSCR, four years before current year | 2.14 | 2.27 | ||||
Amortized cost, more than five years before current | $ 785 | $ 695 | ||||
Average DSCR, more than five years before current year | 2.74 | 2.54 | ||||
Amortized cost | $ 2,192 | $ 1,972 | ||||
Average DSCR | 2.67 | 2.50 |
Investments - Repurchase Agreem
Investments - Repurchase Agreements (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Investments [Abstract] | ||
Gross amount of recognized liabilities for repurchase agreements | $ 564 | $ 663 |
Gross amount of collateral pledged related to repurchase agreements | 577 | 679 |
Gross amount of recognized receivables for reverse repurchase agreements | $ 7 | $ 44 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Derivative [Line Items] | ||||
Notional amount | $ 35,067,000,000 | $ 32,802,000,000 | ||
Invested assets supporting Modco | 775,000,000 | 645,000,000 | ||
Loss reclassification from ACOI, estimated net amount to be transferred | 8,000,000 | |||
Reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges | 0 | $ 0 | 0 | $ 0 |
Derivative, fair value | (777,000,000) | 1,779,000,000 | ||
Margin deposit assets | 4,000,000 | 15,000,000 | ||
Derivative asset, collateral, obligation to return cash, offset | 172,000,000 | 187,000,000 | ||
Securities received as collateral | 30,000,000 | 262,000,000 | ||
Asset Pledged as Collateral | Cash Deposits | ||||
Derivative [Line Items] | ||||
Derivative, fair value | 2,000,000 | 5,000,000 | ||
Asset Pledged as Collateral | Securities | ||||
Derivative [Line Items] | ||||
Derivative, fair value | 270,000,000 | 106,000,000 | ||
Fair value securities | ||||
Derivative [Line Items] | ||||
Securities received as collateral | 5,000,000 | 79,000,000 | ||
Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amount | 34,967,000,000 | 32,552,000,000 | ||
Derivative, fair value | (777,000,000) | 1,779,000,000 | ||
Interest rate swaps | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amount | $ 506,000,000 | $ 276,000,000 |
Derivatives - Balance Sheet Cla
Derivatives - Balance Sheet Classification and Offsetting (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | |||
Notional amount | $ 32,802 | $ 35,067 | |
Derivative, fair value | 1,779 | (777) | |
Derivative asset, fair value, gross, including not subject to master netting arrangement | 2,595 | 291 | |
Derivative liability, fair value, gross, including not subject to master netting arrangement | (816) | (1,068) | |
Designated as Hedging | Cash flow hedges | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 250 | 100 | |
Derivative, fair value | 0 | 0 | |
Derivative asset, fair value, gross | 0 | 0 | |
Derivative liability, fair value, gross | 0 | 0 | |
Designated as Hedging | Cash flow hedges | Interest rate swaps | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 250 | 100 | |
Derivative, fair value | 0 | 0 | |
Derivative asset, fair value, gross | 0 | 0 | |
Derivative liability, fair value, gross | 0 | 0 | |
Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 32,552 | 34,967 | |
Derivative, fair value | 1,779 | (777) | |
Derivative asset, fair value, gross | 2,595 | 291 | |
Derivative liability, fair value, gross | (816) | (1,068) | |
Not Designated as Hedging Instrument | Interest rate swaps | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 276 | 506 | |
Not Designated as Hedging Instrument | Interest rate swaps and futures | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 1,363 | 3,074 | |
Derivative, fair value | (1) | (7) | |
Derivative asset, fair value, gross | 3 | 19 | |
Derivative liability, fair value, gross | (4) | (26) | |
Not Designated as Hedging Instrument | Foreign currency swaps and forwards | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 161 | 161 | |
Derivative, fair value | 15 | 9 | |
Derivative asset, fair value, gross | 16 | 10 | |
Derivative liability, fair value, gross | (1) | (1) | |
Not Designated as Hedging Instrument | Credit derivatives that assume credit risk | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 500 | 100 | |
Derivative, fair value | 4 | 2 | |
Derivative asset, fair value, gross | 4 | 2 | |
Derivative liability, fair value, gross | 0 | 0 | |
Not Designated as Hedging Instrument | GMWB product derivatives | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 6,308 | 7,086 | |
Derivative, fair value | 131 | 80 | |
Derivative asset, fair value, gross | 131 | 100 | |
Derivative liability, fair value, gross | 0 | (20) | |
Not Designated as Hedging Instrument | Reinsurance recoverable for GMWB | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 1,397 | 1,555 | |
Derivative, fair value | (131) | (8) | |
Derivative asset, fair value, gross | 0 | 0 | |
Derivative liability, fair value, gross | (131) | (8) | |
Not Designated as Hedging Instrument | GMWB hedging instruments | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 0 | $ 0 | |
Derivative, fair value | 0 | 0 | |
Derivative asset, fair value, gross | 0 | 0 | |
Derivative liability, fair value, gross | 0 | $ 0 | |
Not Designated as Hedging Instrument | Macro hedge program | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 22,823 | 22,991 | |
Derivative, fair value | 211 | (213) | |
Derivative asset, fair value, gross | 506 | 145 | |
Derivative liability, fair value, gross | (295) | (358) | |
Not Designated as Hedging Instrument | FIA embedded derivative | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 0 | 0 | |
Derivative, fair value | (385) | (655) | |
Derivative asset, fair value, gross | 0 | 0 | |
Derivative liability, fair value, gross | (385) | (655) | |
Not Designated as Hedging Instrument | Reinsurance recoverable for FIA embedded derivative | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 0 | 0 | |
Derivative, fair value | 288 | 0 | |
Derivative asset, fair value, gross | 288 | 0 | |
Derivative liability, fair value, gross | 0 | 0 | |
Not Designated as Hedging Instrument | Funds withheld on modified coinsurance reinsurance contracts | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 0 | 0 | |
Derivative, fair value | 1,647 | 15 | |
Derivative asset, fair value, gross | 1,647 | 15 | |
Derivative liability, fair value, gross | 0 | 0 | |
Fixed maturities, AFS | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 56 | 56 | |
Derivative, fair value | 0 | 0 | |
Derivative asset, fair value, gross | 0 | 0 | |
Derivative liability, fair value, gross | 0 | 0 | |
Other investments | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 11,998 | 8,163 | |
Derivative, fair value | 195 | 43 | |
Derivative asset, fair value, gross | 237 | 91 | |
Derivative liability, fair value, gross | (42) | (48) | |
Other liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 13,043 | 18,206 | |
Derivative, fair value | 34 | (252) | |
Derivative asset, fair value, gross | 292 | 85 | |
Derivative liability, fair value, gross | (258) | (337) | |
Reinsurance recoverable for GMWB | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 1,397 | 1,556 | |
Derivative, fair value | 286 | 7 | |
Derivative asset, fair value, gross | 417 | 15 | |
Derivative liability, fair value, gross | (131) | (8) | |
Funds withheld liability | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 0 | 0 | |
Derivative, fair value | 1,518 | 0 | |
Derivative asset, fair value, gross | 1,518 | 0 | |
Derivative liability, fair value, gross | 0 | 0 | |
Other policyholder funds and benefits payable | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | 6,308 | 7,086 | |
Derivative, fair value | (254) | (575) | |
Derivative asset, fair value, gross | 131 | 100 | |
Derivative liability, fair value, gross | (385) | (675) | |
Derivative liabilities | Other liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability, fair value, gross | (300) | (385) | |
Derivative liability, gross, offset | (195) | (134) | |
Derivative liabilities | 34 | (252) | |
Derivative liability, collateral, right to reclaim cash | (139) | 1 | |
Derivative liability, fair value of collateral | (103) | (251) | |
Derivative liability, amount offset against collateral | (2) | 0 | |
Derivative assets | Other investments | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset, fair value, gross | 529 | 176 | |
Derivative asset, gross amount offset | 446 | 162 | |
Derivative assets | 195 | 43 | |
Derivative, cash collateral | (112) | (29) | |
Derivative asset, financial collateral | 68 | 5 | |
Derivative asset, amount offset against collateral | $ 15 | $ 9 |
Derivatives - Cash Flow Hedges
Derivatives - Cash Flow Hedges (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Pre-Tax Gain (Loss) Recognized in OCI | $ 0 | $ 0 | $ (35) | $ (2) |
Net realized capital gains (losses) | (20) | (242) | 317 | (74) |
Net investment income | 498 | 534 | 778 | 816 |
Gain (loss) reclassification from ACOI, estimated net amount to be transferred | (8) | |||
Interest rate swaps | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Pre-Tax Gain (Loss) Recognized in OCI | 0 | 0 | (35) | 0 |
Foreign currency swaps | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Pre-Tax Gain (Loss) Recognized in OCI | 0 | 0 | 0 | (2) |
Net Gain on Cash Flow Hedging Instruments | Reclassification out of Accumulated Other Comprehensive Income | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Net realized capital gains (losses) | 0 | (1) | 0 | 0 |
Net investment income | 0 | 0 | (1) | 0 |
Net Gain on Cash Flow Hedging Instruments | Reclassification out of Accumulated Other Comprehensive Income | Interest rate swaps | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Net realized capital gains (losses) | 0 | 0 | 0 | 0 |
Net investment income | 0 | 0 | (1) | 0 |
Net Gain on Cash Flow Hedging Instruments | Reclassification out of Accumulated Other Comprehensive Income | Foreign currency swaps | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Net realized capital gains (losses) | 0 | (1) | 0 | 0 |
Net investment income | $ 0 | $ 0 | $ 0 | $ 0 |
Derivatives - Non-qualifying St
Derivatives - Non-qualifying Strategies (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | $ (25) | $ (299) | $ 1,109 | $ (187) |
Not Designated as Hedging Instrument | Credit derivatives that purchase credit protection | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 0 | 0 | 0 | 19 |
Not Designated as Hedging Instrument | Credit derivatives that assume credit risk | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 1 | 0 | 3 | 0 |
Not Designated as Hedging Instrument | Other | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 37 | (54) | 833 | 149 |
Not Designated as Hedging Instrument | Fair Value Hedging | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | (67) | (243) | (1) | (332) |
GMWB product derivatives | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 29 | 82 | 88 | 67 |
Reinsurance recoverable for GMWB | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 4 | (24) | (88) | (27) |
GMWB hedging instruments | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 42 | |||
Macro hedge program | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | (67) | (243) | (1) | (414) |
Macro hedge program | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | (100) | (301) | (1) | (414) |
FIA product derivatives | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 0 | 0 | 270 | 0 |
Foreign currency swaps and forwards | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 5 | (2) | 7 | (7) |
Foreign currency swaps and forwards | Not Designated as Hedging Instrument | Foreign currency swaps | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 5 | (2) | 7 | (4) |
Interest rate derivatives | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | 21 | (76) | (306) | 180 |
Other | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Gain (loss) on derivatives | $ 15 | $ 22 | $ 1,136 | $ (50) |
Derivatives - Schedule of Credi
Derivatives - Schedule of Credit Derivatives (Details) - Credit derivatives - Credit Default Swap - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Credit Derivatives [Line Items] | ||
Notional Amount | $ 500 | $ 100 |
Fair Value | 4 | 2 |
Offsetting Notional Amount | 0 | 0 |
Offsetting Fair Value | 0 | 0 |
Investment grade risk exposure | ||
Credit Derivatives [Line Items] | ||
Notional Amount | 500 | 100 |
Fair Value | $ 4 | $ 2 |
Weighted Average Years to Maturity | 5 years | 5 years |
Offsetting Notional Amount | $ 0 | $ 0 |
Offsetting Fair Value | $ 0 | $ 0 |
Reinsurance - Narrative (Detail
Reinsurance - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||||
Dec. 31, 2022 | Nov. 01, 2022 | Dec. 30, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | $ 40,714 | $ 35,848 | $ 40,714 | ||||
ACL on reinsurance recoverable, decrease | 10 | ||||||
Reinsurance recoverable, allowance for credit loss | 27 | 37 | 27 | ||||
Life insurance recoveries on ceded reinsurance contracts | 782 | $ 958 | 1,648 | $ 1,500 | |||
Guardian | Reinsurance Contract [Axis]: GIAC Reinsurance Agreement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance payable | $ 7,100 | ||||||
Payment for ceded commissions | 65 | ||||||
Assumed reinsurance, deferred gain | 90 | ||||||
Guardian | Reinsurance Contract [Axis]: GIAC Reinsurance Agreement | Separate Account Reserves | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance payable | $ 6,700 | ||||||
Reinsured risk, percentage | 100% | ||||||
Allianz | Reinsurance Contract [Axis]: Allianz Reinsurance Agreement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | 244 | ||||||
Allianz | Reinsurance Contract [Axis]: Inforce Reinsurance Agreement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Payment for ceded commissions | $ 866 | ||||||
Assumed reinsurance, deferred gain | 25 | ||||||
Commonwealth | FIA embedded derivative | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | 8,000 | 8,700 | 8,000 | ||||
Mass Mutual | Retirement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | 6,700 | 6,800 | 6,700 | ||||
Prudential | Individual Life | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | 13,500 | 13,100 | 13,500 | ||||
TR Re | Reinsurance Contract [Axis]: Affiliated Reinsurance Agreement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | 6,130 | ||||||
TR Re | Reinsurance Contract [Axis]: Inforce Agreement and Flow Agreement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Assumed reinsurance, deferred gain | 137 | 137 | |||||
Reinsurance recoverables | $ 5,192 | 5,192 | |||||
Reinsured risk, percentage | 75% | ||||||
TR Re | Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | |||||||
Effects of Reinsurance [Line Items] | |||||||
Payment for ceded commissions | 100 | ||||||
Assumed reinsurance, deferred gain | $ 805 | ||||||
TR Re | Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | Variable Annuity and Payout Annuity Blocks | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsured risk, percentage | 50% | ||||||
TR Re | Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | Variable Annuity Guarantees and Structured Settlement Contracts | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsured risk, percentage | 100% | ||||||
TR Re | Individual Life | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | $ 11,500 | $ 6,100 | $ 11,500 |
Reinsurance - Summary of Assume
Reinsurance - Summary of Assumed and Affiliated Reinsurance (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||||
Dec. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | Nov. 01, 2022 | Dec. 30, 2021 | |
Effects of Reinsurance [Line Items] | |||||||
Investments | $ 27,216 | $ 27,216 | $ 22,792 | ||||
Cash | 49 | 49 | 173 | ||||
Other assets | 416 | 416 | 453 | ||||
Reinsurance recoverables | 35,848 | 35,848 | 40,714 | ||||
VOBA and DAC | (479) | (479) | (518) | ||||
Total assets | 176,364 | 176,364 | 153,111 | ||||
Reserve for future policy benefits | 21,698 | 21,698 | 21,432 | ||||
Other policyholder funds and benefits payable | 32,622 | 32,622 | 31,302 | ||||
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 6,379 | 6,379 | 10,485 | ||||
Other liabilities (related party: $915 and $818) | 1,920 | 1,920 | 2,023 | ||||
Total liabilities | 174,211 | 174,211 | 152,497 | ||||
Revenues | |||||||
Policy charges and fee income | 410 | $ 438 | 506 | $ 741 | |||
Premiums Earned, Net | 31 | 24 | 109 | 35 | |||
Net investment income | 498 | 534 | 778 | 816 | |||
Net realized capital gains (losses) | (20) | (242) | 317 | (74) | |||
Amortization of deferred gains | 0 | 26 | 33 | 53 | |||
Total revenues | 919 | 780 | 1,743 | 1,571 | |||
Benefits, losses and expenses | |||||||
Benefits and losses | 285 | 375 | 637 | 626 | |||
Insurance operating costs and other expenses | 208 | 228 | 294 | 364 | |||
Total benefits, losses and expenses | 588 | 564 | 1,019 | 1,106 | |||
Income before income taxes | 331 | 216 | 724 | 465 | |||
Provision for income taxes | 51 | 51 | 30 | 107 | 66 | ||
Net income | 280 | 280 | $ 186 | 617 | $ 399 | ||
Reinsurance Contract [Axis]: Affiliated Reinsurance Agreement | TR Re | |||||||
Effects of Reinsurance [Line Items] | |||||||
Cash | (184) | (184) | |||||
Reinsurance recoverables | 6,130 | 6,130 | |||||
Total assets | 5,946 | 5,946 | |||||
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 5,128 | 5,128 | |||||
Other liabilities (related party: $915 and $818) | 818 | 818 | |||||
Total liabilities | 5,946 | 5,946 | |||||
Revenues | |||||||
Policy charges and fee income | (279) | ||||||
Premiums Earned, Net | (27) | ||||||
Net investment income | (136) | ||||||
Net realized capital gains (losses) | 990 | ||||||
Amortization of deferred gains | 27 | ||||||
Total revenues | 575 | ||||||
Benefits, losses and expenses | |||||||
Benefits and losses | (184) | ||||||
Insurance operating costs and other expenses | (119) | ||||||
Total benefits, losses and expenses | (303) | ||||||
Income before income taxes | 878 | ||||||
Provision for income taxes | 184 | ||||||
Net income | 694 | ||||||
Reinsurance Contract [Axis]: Allianz Reinsurance Agreement | Allianz | |||||||
Effects of Reinsurance [Line Items] | |||||||
Investments | 8,357 | 8,357 | |||||
Cash | (693) | (693) | |||||
Other assets | 75 | 75 | |||||
Reinsurance recoverables | 244 | 244 | |||||
Total assets | 7,983 | 7,983 | |||||
Reserve for future policy benefits | 616 | 616 | |||||
Other policyholder funds and benefits payable | 7,340 | 7,340 | |||||
Other liabilities (related party: $915 and $818) | 27 | 27 | |||||
Total liabilities | $ 7,983 | $ 7,983 | |||||
Reinsurance Contract [Axis]: GIAC Reinsurance Agreement | Guardian | |||||||
Effects of Reinsurance [Line Items] | |||||||
Investments | $ 405 | ||||||
Cash | 121 | ||||||
Other assets | 3 | ||||||
Total assets | 529 | ||||||
Reserve for future policy benefits | 3 | ||||||
Other policyholder funds and benefits payable | 436 | ||||||
Other liabilities (related party: $915 and $818) | 90 | ||||||
Total liabilities | 529 | ||||||
Revenues | |||||||
Assumed reinsurance, deferred gain | $ 90 | ||||||
Reinsurance Contract [Axis]: Inforce Agreement and Flow Agreement | TR Re | |||||||
Effects of Reinsurance [Line Items] | |||||||
Reinsurance recoverables | 5,192 | ||||||
VOBA and DAC | (11) | ||||||
Total assets | 5,181 | ||||||
Funds withheld liability (related party: $9,248 and $5,128) (portion at fair value: $(1,481) and $(15)) | 5,045 | ||||||
Other liabilities (related party: $915 and $818) | 136 | ||||||
Total liabilities | 5,181 | ||||||
Revenues | |||||||
Assumed reinsurance, deferred gain | $ 137 | ||||||
Reinsurance Contract [Axis]: Inforce Reinsurance Agreement | Allianz | |||||||
Revenues | |||||||
Assumed reinsurance, deferred gain | $ 25 | ||||||
Reinsurance Contract [Axis]: TR Re Reinsurance Agreement | TR Re | |||||||
Revenues | |||||||
Assumed reinsurance, deferred gain | $ 805 |
Reinsurance - Reinsurance Recov
Reinsurance - Reinsurance Recoverable (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Reinsurance Recoverables | $ 40,714 | $ 35,848 |
Reinsurance Recoverables, Gross | 40,741 | 35,885 |
Reinsurance recoverable, allowance for credit loss | 27 | 37 |
Sold businesses (MassMutual and Prudential) | Life insurance and annuities | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Reinsurance Recoverables | 20,174 | 19,850 |
FIA embedded derivative | Commonwealth | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Reinsurance Recoverables | 8,000 | 8,700 |
FIA embedded derivative | Commonwealth | Life insurance and annuities | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Reinsurance Recoverables | 8,001 | 8,718 |
FIA embedded derivative | TR Re | Life insurance and annuities | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Reinsurance Recoverables | 11,537 | 6,130 |
Continuing Operations | Other reinsurers | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Reinsurance Recoverables | $ 1,029 | $ 1,187 |
Reinsurance - Insurance Revenue
Reinsurance - Insurance Revenues (Details) - Other reinsurers - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||||
Gross premiums, policy charges and fee income | $ 1,173 | $ 1,210 | $ 2,240 | $ 2,221 |
Assumed From Other Companies | 69 | 64 | 210 | 125 |
Reinsurance ceded | (801) | (812) | (1,835) | (1,570) |
Net Amount | $ 441 | $ 462 | $ 615 | $ 776 |
Value of Business Acquired an_3
Value of Business Acquired and Deferred Acquisition Costs (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Changes in the VOBA Balance | ||||
Balance, beginning of period | $ 565 | $ 586 | $ 479 | $ 696 |
Amortization - VOBA | (17) | 29 | (45) | 14 |
Amortization - unlock benefit (charge), pre-tax | (73) | 14 | (34) | (64) |
Adjustments to unrealized gains on fixed maturities, AFS and other | 4 | 26 | 108 | (60) |
Balance, end of period | 479 | $ 655 | 508 | $ 586 |
Expected Remaining VOBA Amortization (Successor Company) | ||||
2023 | 13 | |||
2024 | 10 | |||
2025 | 16 | |||
2026 | 25 | |||
2027 | 25 | |||
Changes in the DAC Asset (Successor Company) | ||||
Balance, beginning of period | 0 | |||
Additions | 22 | |||
Amortization - DAC | 0 | |||
Amortization - unlock benefit (charge), pre-tax | 0 | |||
Reinsurance impact | (11) | |||
Balance, end of period | $ 0 | $ 11 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | ||
Balance, beginning of period | $ 97 | $ 0 |
Acquisitions | 0 | 97 |
Balance, end of period | $ 97 | $ 97 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Other Intangible Assets Gross and Net (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortizing intangible assets, gross | $ 41 | $ 41 |
Indefinite lived intangible assets | 26 | 26 |
Other intangible assets, gross | 67 | 67 |
Accumulated amortization | (9) | (3) |
Amortizing intangible assets, net carrying value | 32 | 38 |
Other intangible assets, net carrying value | $ 58 | $ 64 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Expected Future Amortization (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 | $ 6 |
2024 | 6 |
2025 | 6 |
2026 | 6 |
2027 | $ 6 |
Reserves for Future Policy Be_3
Reserves for Future Policy Benefits and Separate Account Liabilities - Changes in Reserve for Future Policy Benefits (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | |
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Liability, beginning balance | $ 21,122 | $ 18,625 | $ 21,698 |
Incurred | 1,135 | 450 | 1,286 |
Paid | (559) | (387) | (1,057) |
Change in unrealized investment gains and losses | (495) | ||
Liability, ending balance | 21,698 | 18,688 | 21,432 |
Reinsurance recoverable asset, beginning balance | 10,000 | 9,139 | 15,039 |
Incurred | 5,237 | 330 | 1,081 |
Paid | (198) | (196) | (589) |
Reinsurance recoverable asset, ending balance | 15,039 | 9,273 | 15,531 |
GMDB | Variable Annuity | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Liability, beginning balance | 346 | 460 | 340 |
Incurred | 38 | 54 | 136 |
Paid | (44) | (50) | (106) |
Change in unrealized investment gains and losses | 0 | ||
Liability, ending balance | 340 | 464 | 370 |
Reinsurance recoverable asset, beginning balance | 184 | 254 | 299 |
Incurred | 152 | 35 | 92 |
Paid | (37) | (41) | (77) |
Reinsurance recoverable asset, ending balance | 299 | 248 | 314 |
Guaranteed Minimum Income Benefit | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Liability, beginning balance | 0 | 604 | |
Incurred | 604 | (25) | |
Paid | 0 | (84) | |
Change in unrealized investment gains and losses | (495) | ||
Liability, ending balance | 604 | 0 | |
Reinsurance recoverable asset, beginning balance | 0 | 0 | |
Incurred | 0 | 0 | |
Paid | 0 | 0 | |
Reinsurance recoverable asset, ending balance | 0 | 0 | |
Secondary Guarantees | Universal Life | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Liability, beginning balance | 4,394 | 4,195 | 4,605 |
Incurred | 240 | 217 | 835 |
Paid | (29) | (18) | (66) |
Change in unrealized investment gains and losses | 0 | ||
Liability, ending balance | 4,605 | 4,394 | 5,374 |
Reinsurance recoverable asset, beginning balance | 4,394 | 4,195 | 4,605 |
Incurred | 240 | 217 | 835 |
Paid | (29) | (18) | (66) |
Reinsurance recoverable asset, ending balance | 4,605 | 4,394 | 5,374 |
Annuitization Benefit | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Liability, beginning balance | 16,382 | 13,970 | 16,149 |
Incurred | 253 | 179 | 340 |
Paid | (486) | (319) | (801) |
Change in unrealized investment gains and losses | 0 | ||
Liability, ending balance | 16,149 | 13,830 | 15,688 |
Reinsurance recoverable asset, beginning balance | 5,422 | 4,690 | 10,135 |
Incurred | 4,845 | 78 | 154 |
Paid | (132) | (137) | (446) |
Reinsurance recoverable asset, ending balance | $ 10,135 | $ 4,631 | $ 9,843 |
Reserves for Future Policy Be_4
Reserves for Future Policy Benefits and Separate Account Liabilities - Account Value by Type (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account liabilities | $ 87,255,000,000 | $ 111,592,000,000 |
Separate account assets | 87,255,000,000 | $ 111,592,000,000 |
Separate account base contract assets not reinsured | 1,007,000,000 | |
GMDB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 2,983,000,000 | |
Separate account liabilities | 32,482,000,000 | |
GMDB | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 35,465,000,000 | |
Net amount at risk | 4,204,000,000 | |
Retained net amount at risk | $ 976,000,000 | |
Weighted average attained age | 73 years | |
GMDB | Variable Annuity | MAV only | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 9,984,000,000 | |
GMDB | Variable Annuity | With Five Percent Rollup | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 1,478,000,000 | |
GMDB | Variable Annuity | With Earnings Protection Benefit Rider (EPB) | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 2,414,000,000 | |
GMDB | Variable Annuity | With Five Percent Rollup and EPB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 336,000,000 | |
GMDB | Variable Annuity | Annuitization Benefit | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 14,212,000,000 | |
Retained net amount at risk | 574,000,000 | |
GMDB | Variable Annuity | Asset Protection Benefit ("APB") | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 6,165,000,000 | |
Net amount at risk | 851,000,000 | |
Retained net amount at risk | $ 282,000,000 | |
Weighted average attained age | 73 years | |
GMDB | Variable Annuity | Lifetime Income Benefit ("LIB") - Death Benefit | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 258,000,000 | |
Net amount at risk | 4,000,000 | |
Retained net amount at risk | $ 2,000,000 | |
Weighted average attained age | 76 years | |
GMDB | Variable Annuity | Reset | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 2,122,000,000 | |
Net amount at risk | 96,000,000 | |
Retained net amount at risk | $ 56,000,000 | |
Weighted average attained age | 72 years | |
GMDB | Variable Annuity | Return of Net Deposit | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 10,097,000,000 | |
Net amount at risk | 105,000,000 | |
Retained net amount at risk | $ 62,000,000 | |
Weighted average attained age | 71 years | |
GMDB | Variable Annuity | Maximum | MAV only | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Net amount at risk | $ 2,257,000,000 | |
Retained net amount at risk | 302,000,000 | |
GMDB | Variable Annuity | Maximum | With Five Percent Rollup | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Net amount at risk | 295,000,000 | |
Retained net amount at risk | 196,000,000 | |
GMDB | Variable Annuity | Maximum | With Earnings Protection Benefit Rider (EPB) | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Net amount at risk | 513,000,000 | |
Retained net amount at risk | 55,000,000 | |
GMDB | Variable Annuity | Maximum | With Five Percent Rollup and EPB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Net amount at risk | 83,000,000 | |
Retained net amount at risk | 21,000,000 | |
GMDB | Variable Annuity | Maximum | Annuitization Benefit | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Net amount at risk | $ 3,148,000,000 | |
GMDB | Variable Annuity | Weighted Average | MAV only | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Weighted average attained age | 74 years | |
GMDB | Variable Annuity | Weighted Average | With Five Percent Rollup | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Weighted average attained age | 73 years | |
GMDB | Variable Annuity | Weighted Average | With Earnings Protection Benefit Rider (EPB) | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Weighted average attained age | 75 years | |
GMDB | Variable Annuity | Weighted Average | With Five Percent Rollup and EPB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Weighted average attained age | 76 years | |
Variable annuity without GMDB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 8,600,000,000 | |
Deferred Annuitization | Variable Annuity | Variable annuity without GMDB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | 2,611,000,000 | |
Net amount at risk | 0 | |
Retained net amount at risk | $ 0 | |
Weighted average attained age | 73 years | |
GMWB embedded derivative | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Net amount at risk | $ 0 | |
Weighted average attained age | 72 years | |
Separate account liabilities - other | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account liabilities | $ 62,393,000,000 | |
Separate account assets assumed under modified coinsurance | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account assets | $ 6,613,000,000 |
Reserves for Future Policy Be_5
Reserves for Future Policy Benefits and Separate Account Liabilities - Separate Accounts by Major Category of Investment (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Fair value | $ 25,869 | $ 34,602 |
Invested in fixed income securities | 18% | 17% |
Invested in equity securities | 82% | 83% |
Equity securities, at fair value | ||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Fair value | $ 24,548 | $ 33,240 |
Cash | ||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Fair value | 1,321 | 1,362 |
GMDB | ||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Account value | 2,983 | |
Deferred Annuitization | GMDB | ||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | ||
Account value | $ 2,600 | $ 3,000 |
Debt (Details)
Debt (Details) | Dec. 31, 2022 USD ($) |
Obligation with Joint and Several Liability Arrangement [Line Items] | |
FHLBB advances | $ 0 |
Asset Pledged as Collateral with Right | Federal Home Loan Bank Advances | |
Obligation with Joint and Several Liability Arrangement [Line Items] | |
Financial instruments owned | $ 922,000,000 |
Income Taxes - Income tax expen
Income Taxes - Income tax expense (benefit) (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||||
Current - U.S. Federal | $ (86) | $ 0 | $ (18) | $ 10 | |
Deferred - U.S. Federal | 137 | 30 | 125 | 56 | |
Total income tax expense | $ 51 | $ 51 | $ 30 | $ 107 | $ 66 |
Income Taxes - Deferred tax ass
Income Taxes - Deferred tax assets (liabilities) (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred Tax Assets | ||
Tax basis deferred policy acquisition costs | $ 129 | $ 110 |
VOBA and reserves | 349 | 716 |
Net operating loss carryover | 1 | 25 |
Employee benefits | 4 | 7 |
Foreign tax credit carryover | 16 | 16 |
Net unrealized loss on investments | 703 | 4 |
Deferred reinsurance gain | 228 | 187 |
Total deferred tax assets | 1,430 | 1,065 |
Deferred Tax Liabilities | ||
Investment related items | (366) | (449) |
Other | (13) | (13) |
Total deferred tax liabilities | (379) | (462) |
Net deferred tax asset | $ 1,051 | $ 603 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Unrecognized tax benefits | $ 0 | $ 0 | ||
Unrecognized tax benefit that would affect the effective tax rate | 0 | 0 | ||
Unrecognized tax benefits, penalties and interest expense | 0 | $ 0 | 0 | $ 0 |
Income taxes payable | 0 | 0 | ||
Unrecognized tax benefits, penalties and interest accrued | 0 | 0 | ||
Net operating loss | 117,000,000 | 3,000,000 | ||
Foreign tax credit carryover | $ 16,000,000 | $ 16,000,000 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||||
Tax provision at U.S. Federal statutory rate | $ 70 | $ 45 | $ 152 | $ 98 | |
Dividends received deduction ("DRD") | (16) | (14) | (38) | (28) | |
Foreign related investments | (2) | (1) | (7) | (4) | |
Other | (1) | 0 | 0 | 0 | |
Total income tax expense | $ 51 | $ 51 | $ 30 | $ 107 | $ 66 |
Commitments and Contingencies -
Commitments and Contingencies - Unfunded Commitments (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Other Commitments [Line Items] | |
Other commitment | $ 974 |
Commitments to fund partnerships and alternative investments | 410 |
Commitment to fund Private placement securities | 323 |
Commitments to fund mortgage loans | 241 |
Cancelable mortgage loan | |
Other Commitments [Line Items] | |
Other commitment | $ 29 |
Commitments and Contingencies_2
Commitments and Contingencies - Guaranty Fund (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | ||
Minimum percentage of premiums written to be considered for assessment under guaranty fund | 0.01 | |
Maximum percentage of premiums written to be considered for assessment under guaranty fund | 0.02 | |
Guaranty liabilities | $ 4 | $ 4 |
Loss contingency accrual, premium tax offset | $ 1 | $ 1 |
Commitments and Contingencies_3
Commitments and Contingencies - Derivative Commitments (Details) | Dec. 31, 2022 USD ($) |
Loss Contingencies [Line Items] | |
Derivative, liability position, fair value | $ 110,000,000 |
Collateral posted, fair value | 111,000,000 |
GMWB product derivatives | |
Loss Contingencies [Line Items] | |
Collateral posted, fair value | $ 0 |
Transactions with Affiliates (D
Transactions with Affiliates (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Oct. 13, 2022 | Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2022 | Aug. 05, 2022 | |
Affiliated Entity | Intercompany Liquidity Agreements | |||||
Effects of Reinsurance [Line Items] | |||||
Due from related party | $ 100,000,000 | $ 100,000,000 | |||
Related party transaction, rate | 3.40% | ||||
Due to related party | 0 | ||||
Affiliated Entity | Intercompany Liquidity Agreements | Parent Company | |||||
Effects of Reinsurance [Line Items] | |||||
Maximum borrowing capacity | $ 1,500,000,000 | ||||
Maximum lending capacity per individual | 500,000,000 | ||||
Affiliated Entity | Intercompany Liquidity Agreements | Subsidiaries | |||||
Effects of Reinsurance [Line Items] | |||||
Maximum borrowing capacity | 600,000,000 | ||||
Maximum lending capacity per individual | $ 200,000,000 | ||||
Affiliated Entity | Investment Management Service Agreement | |||||
Effects of Reinsurance [Line Items] | |||||
Due to related party | $ 0 | $ 0 | 0 | ||
Expenses from transactions with related party | 0 | 1,000,000 | |||
Affiliated Entity | Investments Issued | Sixth Street | |||||
Effects of Reinsurance [Line Items] | |||||
Due from related party | 0 | $ 0 | 49,000,000 | ||
Related party transaction amount | 12,000,000 | ||||
Limited Liability Company | Insurance Administration Services and Support | |||||
Effects of Reinsurance [Line Items] | |||||
Related party transaction amount | $ 14,000,000 | $ 53,000,000 |
Statutory Results - Summary of
Statutory Results - Summary of Statutory Results (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||||
Jun. 28, 2021 | Sep. 18, 2020 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statutory Accounting Practices [Line Items] | |||||||
Combined statutory net income (loss) | $ (426) | $ (2) | $ 441 | $ 245 | |||
Statutory capital | $ 2,153 | 2,738 | $ 2,153 | ||||
Statutory accounting practices, prescribed practice amount | $ 40 | $ 29 | |||||
Talcott Resolution Life, Inc | |||||||
Statutory Accounting Practices [Line Items] | |||||||
Dividends paid with approval of regulatory agency | $ 500 | $ 319 |
Statutory Results - Regulatory
Statutory Results - Regulatory Capital Requirements (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Insurance [Abstract] | ||
Statutory Accounting Practices, Risk Based Capital Requirements Compliance Assertion | The Company and all of its operating insurance subsidiaries had RBC ratios in excess of the minimum levels required by the applicable insurance regulations. The RBC ratios for the Company and its principal life insurance operating subsidiaries were all in excess of 300% of their Company Action Levels | The Company and all of its operating insurance subsidiaries had RBC ratios in excess of the minimum levels required by the applicable insurance regulations. The RBC ratios for the Company and its principal life insurance operating subsidiaries were all in excess of 300% of their Company Action Levels |
Statutory Results - Dividends a
Statutory Results - Dividends and Capital Contributions (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 28, 2021 | Sep. 18, 2020 | Dec. 31, 2022 |
Statutory Accounting Practices [Line Items] | ||||
Dividends paid with approval of regulatory agency, period | 2 years | |||
Statutory amount available for dividend payments without regulatory approval | $ 578 | |||
Talcott Life and Annuity Company (TLA) | ||||
Statutory Accounting Practices [Line Items] | ||||
Statutory amount available for dividend payments without regulatory approval | $ 96 | |||
Dividends paid with approval of regulatory agency | $ 400 | |||
Talcott Resolution Life, Inc | ||||
Statutory Accounting Practices [Line Items] | ||||
Dividends paid with approval of regulatory agency | $ 500 | $ 319 |
Changes in and Reclassificati_3
Changes in and Reclassifications From Accumulated Other Comprehensive Income - AOCI Rollforward (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance | $ 1,883 | $ 2,597 | $ 3,185 | $ 2,153 | $ 2,552 |
OCI before reclassifications | (14) | (301) | (3,141) | 840 | |
Amounts reclassified from AOCI | 2 | (46) | 412 | (126) | |
OCI, before tax | (12) | (347) | (2,729) | 714 | |
Income tax benefit (expense) | 2 | 73 | 573 | (150) | |
OCI, net of tax | (10) | (10) | (274) | (2,156) | 564 |
Ending balance | 2,153 | 2,153 | 2,597 | 614 | 3,185 |
Accumulated Other Comprehensive Loss | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance | 0 | 1,007 | 1,281 | (10) | 717 |
OCI, net of tax | (10) | (274) | (2,156) | 564 | |
Ending balance | (10) | (10) | 1,007 | (2,166) | 1,281 |
Net Unrealized Gain on Fixed Maturities, AFS | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance | 0 | 1,007 | 1,282 | (10) | 717 |
OCI before reclassifications | (14) | (301) | (3,107) | 842 | |
Amounts reclassified from AOCI | 2 | (47) | 412 | (127) | |
OCI, before tax | (12) | (348) | (2,695) | 715 | |
Income tax benefit (expense) | 2 | 73 | 566 | (150) | |
OCI, net of tax | (10) | (275) | (2,129) | 565 | |
Ending balance | (10) | (10) | 1,007 | (2,139) | 1,282 |
Unrealized Losses on Fixed Maturities, AFS for Which an ACL Has Been Recorded | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance | 0 | 0 | |||
OCI before reclassifications | (1) | ||||
Amounts reclassified from AOCI | 1 | ||||
OCI, before tax | 0 | ||||
Income tax benefit (expense) | 0 | ||||
OCI, net of tax | 0 | ||||
Ending balance | 0 | ||||
Net Gain on Cash Flow Hedging Instruments | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Beginning balance | 0 | 0 | (1) | 0 | 0 |
OCI before reclassifications | 0 | 0 | (34) | (1) | |
Amounts reclassified from AOCI | 0 | 1 | 0 | 0 | |
OCI, before tax | 0 | 1 | (34) | (1) | |
Income tax benefit (expense) | 0 | 0 | 7 | 0 | |
OCI, net of tax | 0 | 1 | (27) | (1) | |
Ending balance | $ 0 | $ 0 | $ 0 | $ (27) | $ (1) |
Changes in and Reclassificati_4
Changes in and Reclassifications From Accumulated Other Comprehensive Income - Reclassification of AOCI (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | $ (20) | $ (242) | $ 317 | $ (74) | |
Net investment income | 498 | 534 | 778 | 816 | |
Income before income taxes | 331 | 216 | 724 | 465 | |
Provision for income taxes | 51 | $ 51 | 30 | 107 | 66 |
Net income | 280 | $ 280 | 186 | 617 | 399 |
Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net income | (2) | 36 | (325) | 99 | |
Net Unrealized Gain on Fixed Maturities, AFS | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | (2) | 47 | (412) | 127 | |
Income before income taxes | (2) | 47 | (412) | 127 | |
Provision for income taxes | 0 | 10 | (87) | 27 | |
Net income | (2) | 37 | (325) | 100 | |
Unrealized Losses on Fixed Maturities, AFS for Which an ACL Has Been Recorded | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | 0 | 0 | 0 | (1) | |
Income before income taxes | 0 | 0 | 0 | (1) | |
Provision for income taxes | 0 | 0 | 0 | 0 | |
Net income | 0 | 0 | 0 | (1) | |
Net Gain on Cash Flow Hedging Instruments | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | 0 | (1) | 0 | 0 | |
Net investment income | 0 | 0 | (1) | 0 | |
Provision for income taxes | 0 | 0 | 0 | 0 | |
Net income | 0 | (1) | 0 | 0 | |
Net Gain on Cash Flow Hedging Instruments | Interest rate swaps | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | 0 | 0 | 0 | 0 | |
Net investment income | 0 | 0 | (1) | 0 | |
Net Gain on Cash Flow Hedging Instruments | Foreign currency swaps | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | 0 | (1) | 0 | 0 | |
Net investment income | 0 | 0 | 0 | 0 | |
Net Gain on Cash Flow Hedging Instruments | Cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Income before income taxes | 0 | (1) | 0 | 0 | |
Net Gain on Cash Flow Hedging Instruments | Cash flow hedges | Interest rate swaps | Reclassification out of Accumulated Other Comprehensive Income | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | 0 | 0 | 0 | 0 | |
Net investment income | 0 | 0 | 0 | 0 | |
Net Gain on Cash Flow Hedging Instruments | Cash flow hedges | Foreign currency swaps | |||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||
Net realized capital gains (losses) | $ 0 | $ (1) | $ 0 | $ 0 |
Revenue from Contracts with C_3
Revenue from Contracts with Customer (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Administration and distribution services fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 45 | $ 44 | $ 76 | $ 80 |
Subsequent Event (Details)
Subsequent Event (Details) - Intercompany Liquidity Agreements - Affiliated Entity - USD ($) $ in Millions | Jan. 27, 2023 | Oct. 13, 2022 | Dec. 31, 2022 |
Subsequent Event [Line Items] | |||
Due from related party | $ 100 | $ 100 | |
Related party transaction, rate | 3.40% | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Due from related party | $ 60 | ||
Related party transaction, rate | 4.50% |
Schedule I - Summary of Inves_2
Schedule I - Summary of Investments - Other Than Investments in Affiliates (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2021 |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | $ 26,459 | ||
Amount at Which Shown on Balance Sheet | 22,792 | ||
Mortgage loans, allowance for credit loss | 15 | $ 12 | $ 11 |
Fixed Maturities, FVO | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 19,041 | ||
Fair Value | 15,714 | ||
Amount at Which Shown on Balance Sheet | 15,714 | ||
Total fixed maturities, available-for-sale | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 18,689 | ||
Fair Value | 15,383 | ||
Amount at Which Shown on Balance Sheet | 15,383 | ||
U.S. government and government agencies and authorities (guaranteed and sponsored) | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 1,395 | ||
Fair Value | 1,070 | ||
Amount at Which Shown on Balance Sheet | 1,070 | ||
States, municipalities and political subdivisions | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 1,320 | ||
Fair Value | 1,040 | ||
Amount at Which Shown on Balance Sheet | 1,040 | ||
Foreign governments | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 379 | ||
Fair Value | 315 | ||
Amount at Which Shown on Balance Sheet | 315 | ||
Public utilities | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 1,776 | ||
Fair Value | 1,423 | ||
Amount at Which Shown on Balance Sheet | 1,423 | ||
All other corporate bonds | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 10,769 | ||
Fair Value | 8,818 | ||
Amount at Which Shown on Balance Sheet | 8,818 | ||
All other mortgage-backed and asset-backed securities | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 3,050 | ||
Fair Value | 2,717 | ||
Amount at Which Shown on Balance Sheet | 2,717 | ||
Fixed maturities, at fair value using fair value option | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 352 | ||
Fair Value | 331 | ||
Amount at Which Shown on Balance Sheet | 331 | ||
Industrial, miscellaneous and all other | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 14 | ||
Fair Value | 14 | ||
Amount at Which Shown on Balance Sheet | 14 | ||
Non-redeemable preferred stocks | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 191 | ||
Fair Value | 165 | ||
Amount at Which Shown on Balance Sheet | 165 | ||
Total equity securities, at fair value | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 205 | ||
Fair Value | 179 | ||
Amount at Which Shown on Balance Sheet | 179 | ||
Mortgage loan | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 2,535 | ||
Fair Value | 2,232 | ||
Amount at Which Shown on Balance Sheet | 2,520 | ||
Policy loans | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 1,495 | ||
Fair Value | 1,495 | ||
Amount at Which Shown on Balance Sheet | 1,495 | ||
Futures, options and miscellaneous | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 384 | ||
Fair Value | 85 | ||
Amount at Which Shown on Balance Sheet | 85 | ||
Real estate acquired in satisfaction of debt | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 10 | ||
Fair Value | 10 | ||
Amount at Which Shown on Balance Sheet | 10 | ||
Short-term investments | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 1,489 | ||
Fair Value | 1,489 | ||
Amount at Which Shown on Balance Sheet | 1,489 | ||
Investments in partnerships and trusts | |||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |||
Cost | 1,300 | ||
Amount at Which Shown on Balance Sheet | $ 1,300 |
Schedule IV - Schedule of Rei_2
Schedule IV - Schedule of Reinsurance (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Life insurance in-force | ||||
Gross Amount | $ 232,607 | $ 236,517 | $ 222,398 | $ 239,801 |
Ceded to Other Companies | 166,822 | 170,776 | 158,750 | 174,372 |
Assumed From Other Companies | 158 | 166 | 155 | 173 |
Net Amount | $ 65,943 | $ 65,907 | $ 63,803 | $ 65,602 |
Percentage of Amount Assumed to Net | 0% | 0% | 0% | 0% |
Premiums Earned | ||||
Percentage of Amount Assumed to Net | 16% | 14% | 34% | 16% |
Life insurance and annuities | ||||
Premiums Earned | ||||
Gross Amount | $ 1,170 | $ 1,202 | $ 2,228 | $ 2,201 |
Ceded to Other Companies | 798 | 804 | 1,823 | 1,550 |
Assumed From Other Companies | 69 | 64 | 210 | 125 |
Net Amount | $ 441 | $ 462 | $ 615 | $ 776 |
Percentage of Amount Assumed to Net | 16% | 14% | 34% | 16% |
Accident health insurance | ||||
Premiums Earned | ||||
Gross Amount | $ 3 | $ 8 | $ 12 | $ 20 |
Ceded to Other Companies | 3 | 8 | 12 | 20 |
Assumed From Other Companies | 0 | 0 | 0 | 0 |
Net Amount | $ 0 | $ 0 | $ 0 | $ 0 |
Percentage of Amount Assumed to Net | 0% | 0% | 0% | 0% |
Other reinsurers | ||||
Premiums Earned | ||||
Gross Amount | $ 1,173 | $ 1,210 | $ 2,240 | $ 2,221 |
Ceded to Other Companies | 801 | 812 | 1,835 | 1,570 |
Assumed From Other Companies | 69 | 64 | 210 | 125 |
Net Amount | $ 441 | $ 462 | $ 615 | $ 776 |
Schedule V - Valuation and Qu_2
Schedule V - Valuation and Qualifying Accounts (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Allowance for credit losses ("ACL") on fixed maturities, AFS | ||||
Movement in Valuation allowance and reserves | ||||
Balance January 1, | $ 0 | $ 1 | $ 0 | $ 0 |
Charged to Costs and Expenses | 0 | 0 | 1 | 1 |
Write-offs/Payments/Other | 0 | 0 | (1) | 0 |
Balance December 31, | 0 | 1 | 0 | 1 |
ACL on mortgage loans | ||||
Movement in Valuation allowance and reserves | ||||
Balance January 1, | 12 | 17 | 12 | 9 |
Charged to Costs and Expenses | 0 | (6) | 3 | 8 |
Write-offs/Payments/Other | 0 | 0 | 0 | 0 |
Balance December 31, | 12 | 11 | 15 | 17 |
ACL on reinsurance recoverables | ||||
Movement in Valuation allowance and reserves | ||||
Balance January 1, | 34 | 7 | 37 | 5 |
Charged to Costs and Expenses | 3 | 0 | 0 | 2 |
Write-offs/Payments/Other | 0 | 0 | (10) | 0 |
Balance December 31, | $ 37 | $ 7 | $ 27 | $ 7 |