COVER
COVER - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 03, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-20501 | |
Entity Registrant Name | Equitable Financial Life Insurance Company | |
Entity Incorporation, State or Country Code | NY | |
Entity Tax Identification Number | 13-5570651 | |
Entity Address, Address Line One | 1290 Avenue of the Americas | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10104 | |
City Area Code | 212 | |
Local Phone Number | 554-1234 | |
Entity Information, Former Legal or Registered Name | AXA Equitable Life Insurance Company | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 2,000,000 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Amendment Flag | false | |
Entity Central Index Key | 0000727920 | |
Current Fiscal Year End Date | --12-31 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 | |
Investments: | |||
Fixed maturities available-for-sale, at fair value (amortized cost of $63,615 and $59,278) (allowance for credit losses of $13 at June 30, 2020) | $ 71,822 | $ 62,362 | |
Mortgage loans on real estate (net of allowance for credit losses of $66 at June 30, 2020) | 12,506 | 12,090 | |
Policy loans | 3,225 | 3,270 | |
Other equity investments | [1] | 1,154 | 1,149 |
Trading securities, at fair value | 6,141 | 6,598 | |
Other invested assets | 1,962 | 2,156 | |
Total investments | 96,810 | 87,625 | |
Cash and cash equivalents | 4,318 | 1,492 | |
Deferred policy acquisition costs | 3,746 | 4,337 | |
Amounts due from reinsurers (allowance for credit losses of $6 at June 30, 2020) | 3,032 | 3,001 | |
Loans to affiliates | 1,200 | 1,200 | |
GMIB reinsurance contract asset, at fair value | 3,433 | 2,466 | |
Current and deferred income taxes | 0 | 224 | |
Other assets | 3,071 | 3,050 | |
Separate Accounts assets | 116,768 | 124,646 | |
Total Assets | 232,378 | 228,041 | |
LIABILITIES | |||
Policyholders’ account balances | 55,732 | 55,421 | |
Future policy benefits and other policyholders' liabilities | 41,382 | 33,976 | |
Broker-dealer related payables | 647 | 428 | |
Amounts due to reinsurers | 96 | 105 | |
Current and deferred income taxes | 1,020 | 0 | |
Other liabilities | 1,531 | 1,768 | |
Separate Accounts liabilities | 116,768 | 124,646 | |
Total Liabilities | 217,176 | 216,344 | |
Redeemable noncontrolling interest | [2] | 36 | 39 |
Commitments and contingent liabilities | |||
Equity attributable to Equitable Financial: | |||
Common stock, $1.25 par value; 2,000,000 shares authorized, issued and outstanding | 2 | 2 | |
Additional paid-in capital | 7,821 | 7,809 | |
Retained earnings | 2,658 | 2,242 | |
Accumulated other comprehensive income (loss) | 4,676 | 1,592 | |
Total equity attributable to Equitable Financial | 15,157 | 11,645 | |
Noncontrolling interest | 9 | 13 | |
Total Equity | 15,166 | 11,658 | |
Total Liabilities, Redeemable Noncontrolling Interest and Equity | $ 232,378 | $ 228,041 | |
[1] | See Note 2 for details of balances with variable interest entities. | ||
[2] | See Note 12 for details of Redeemable noncontrolling interest. |
CONSOLIDATED BALANCE SHEETS (PA
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Fixed maturities available-for-sale, amortized cost | $ 63,602 | |
Fixed maturities available-for-sale, allowance for credit losses | (13) | $ 0 |
Mortgage loans on real estate, valuation allowances | 66 | |
Reinsurance recoverable, allowance for credit loss | $ 6 | |
Common stock par value (in dollars per share) | $ 1.25 | $ 1.25 |
Common stock authorized (in shares) | 2,000,000 | 2,000,000 |
Common stock issued (in shares) | 2,000,000 | 2,000,000 |
Common stock outstanding (in shares) | 2,000,000 | 2,000,000 |
Fixed maturities | ||
Fixed maturities available-for-sale, amortized cost | $ 63,615 | $ 59,278 |
Fixed maturities available-for-sale, allowance for credit losses | $ 13 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
REVENUES | ||||
Policy charges and fee income | $ 825 | $ 865 | $ 1,729 | $ 1,724 |
Premiums | 199 | 232 | 435 | 464 |
Net derivative gains (losses) | (5,903) | (178) | 3,630 | (1,733) |
Net investment income (loss) | 934 | 879 | 1,525 | 1,783 |
Investment gains (losses), net: | ||||
Credit losses on AFS debt securities and loans | (31) | 0 | (43) | 0 |
Other investment gains (losses), net | 176 | (12) | 243 | (20) |
Total investment gains (losses), net | 145 | (12) | 200 | (20) |
Investment management and service fees | 235 | 255 | 487 | 503 |
Other income | 8 | 30 | 25 | 40 |
Total revenues | (3,557) | 2,071 | 8,031 | 2,761 |
BENEFITS AND OTHER DEDUCTIONS | ||||
Policyholders’ benefits | 700 | 868 | 3,297 | 1,687 |
Interest credited to policyholders’ account balances | 279 | 288 | 568 | 557 |
Compensation and benefits | 54 | 85 | 134 | 167 |
Commissions | 148 | 152 | 309 | 309 |
Interest expense | 0 | 0 | 0 | 4 |
Amortization of deferred policy acquisition costs | 164 | 144 | 1,222 | 309 |
Other operating costs and expenses | 218 | 216 | 431 | 400 |
Total benefits and other deductions | 1,563 | 1,753 | 5,961 | 3,433 |
Income (loss) from continuing operations, before income taxes | (5,120) | 318 | 2,070 | (672) |
Income tax (expense) benefit | 1,029 | (53) | (425) | 109 |
Net income (loss) | (4,091) | 265 | 1,645 | (563) |
Less: Net income (loss) attributable to the noncontrolling interest | 4 | 1 | (3) | 3 |
Net income (loss) attributable to Equitable Financial | $ (4,095) | $ 264 | $ 1,648 | $ (566) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |||
COMPREHENSIVE INCOME (LOSS) | ||||||
Net income (loss) | $ (4,091) | $ 265 | $ 1,645 | $ (563) | ||
Other comprehensive income (loss), net of income taxes: | ||||||
Change in unrealized gains (losses), net of adjustment | [1] | 1,569 | 1,291 | 3,083 | 2,055 | |
Changes in defined benefit plan related items not yet recognized in periodic benefit cost, net of reclassification adjustment | 1 | 0 | 1 | 0 | ||
Other comprehensive income (loss), net of income taxes | 1,570 | 1,291 | 3,084 | 2,055 | ||
Comprehensive income (loss) | (2,521) | 1,556 | 4,729 | 1,492 | [2] | |
Less: Comprehensive income (loss) attributable to the noncontrolling interest | [2] | (3) | (2) | (3) | 0 | |
Comprehensive income (loss) attributable to Equitable Financial | $ (2,518) | $ 1,558 | $ 4,732 | $ 1,492 | [1] | |
[1] | See Note 11 for details of Change in unrealized gains (losses), net of adjustments. | |||||
[2] | Amounts for the three and six months ended June 30, 2019 were reclassified to conform to the current year’s presentation. |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Cumulative effect of period of adoption, adjusted balance | AXA Equitable Equity | AXA Equitable EquityCumulative effect of period of adoption, adjusted balance | Common Stock | Additional Paid-in Capital | Retained Earnings | Retained EarningsCumulative effect of period of adoption, adjusted balance | Accumulated other comprehensive income (loss) attributable to AXA Equitable | Noncontrolling Interest |
Beginning balance at Dec. 31, 2018 | $ 12,428 | $ 12,416 | $ 2 | $ 7,807 | $ 5,098 | $ (491) | $ 12 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income (loss) | (566) | (566) | (566) | |||||||
Other comprehensive income (loss) | 2,055 | 2,055 | 2,055 | |||||||
Other | 15 | 15 | 15 | |||||||
Ending balance at Jun. 30, 2019 | 13,932 | 13,920 | 2 | 7,822 | 4,532 | 1,564 | 12 | |||
Beginning balance at Mar. 31, 2019 | 12,370 | 12,358 | 2 | 7,815 | 4,268 | 273 | 12 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income (loss) | 264 | 264 | 264 | |||||||
Other comprehensive income (loss) | 1,291 | 1,291 | 1,291 | |||||||
Other | 7 | 7 | 7 | |||||||
Ending balance at Jun. 30, 2019 | 13,932 | 13,920 | 2 | 7,822 | 4,532 | 1,564 | 12 | |||
Beginning balance at Dec. 31, 2019 | 11,658 | $ (32) | 11,645 | $ (32) | 2 | 7,809 | 2,242 | $ (32) | 1,592 | 13 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Dividend to parent company | (1,200) | (1,200) | (1,200) | 0 | ||||||
Net income (loss) | 1,646 | 1,648 | 1,648 | (2) | ||||||
Other comprehensive income (loss) | 3,084 | 3,084 | 3,084 | |||||||
Other | 10 | 12 | 12 | (2) | ||||||
Ending balance at Jun. 30, 2020 | $ 15,166 | 15,157 | 2 | 7,821 | 2,658 | 4,676 | 9 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Accounting standards update [extensible list] | us-gaap:AccountingStandardsUpdate201613Member | |||||||||
Beginning balance at Mar. 31, 2020 | $ 18,881 | 18,872 | 2 | 7,811 | 7,953 | 3,106 | 9 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Dividend to parent company | (1,200) | (1,200) | (1,200) | |||||||
Net income (loss) | (4,095) | (4,095) | (4,095) | |||||||
Other comprehensive income (loss) | 1,570 | 1,570 | 1,570 | |||||||
Other | 10 | 10 | 10 | |||||||
Ending balance at Jun. 30, 2020 | $ 15,166 | $ 15,157 | $ 2 | $ 7,821 | $ 2,658 | $ 4,676 | $ 9 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Cash Flows [Abstract] | ||
Net income (loss) | $ 1,645 | $ (563) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Interest credited to policyholders’ account balances | 568 | 557 |
Policy charges and fee income | (1,729) | (1,724) |
Net derivative (gains) losses | (3,630) | 1,733 |
Credit losses on AFS debt securities and loans | 43 | 0 |
Investment (gains) losses, net | (243) | 20 |
Realized and unrealized (gains) losses on trading securities | (104) | (401) |
Non-cash long-term incentive compensation expense | 13 | 17 |
Amortization and depreciation | 1,181 | 268 |
Equity (income) loss from limited partnerships | 53 | (39) |
Changes in: | ||
Reinsurance recoverable | (149) | (59) |
Capitalization of deferred policy acquisition costs | (291) | (310) |
Future policy benefits | 1,666 | 91 |
Current and deferred income taxes | 433 | 99 |
Other, net | (324) | 28 |
Net cash provided by (used in) operating activities | (868) | (283) |
Proceeds from the sale/maturity/prepayment of: | ||
Fixed maturities, available-for-sale | 7,269 | 4,842 |
Mortgage loans on real estate | 383 | 288 |
Trading account securities | 801 | 7,117 |
Real estate joint ventures | 0 | 2 |
Short-term investments | 935 | 1,518 |
Other | 155 | 95 |
Payment for the purchase/origination of: | ||
Fixed maturities, available-for-sale | (11,292) | (12,385) |
Mortgage loans on real estate | (860) | (757) |
Trading account securities | (236) | (663) |
Short-term investments | (651) | (1,594) |
Other | (232) | (108) |
Cash settlements related to derivative instruments | 5,084 | (1,089) |
Investment in capitalized software, leasehold improvements and EDP equipment | (21) | (31) |
Other, net | 51 | (11) |
Net cash provided by (used in) investing activities | 1,386 | (2,776) |
Cash flows from financing activities: | ||
Deposits | 4,327 | 4,609 |
Withdrawals | (2,045) | (2,291) |
Transfer (to) from Separate Accounts | 900 | 876 |
Change in collateralized pledged assets | 58 | (8) |
Change in collateralized pledged liabilities | 247 | 1,479 |
Shareholder dividend paid | (1,200) | 0 |
Purchase (redemption) of noncontrolling interests of consolidated company-sponsored investment funds | 1 | 10 |
Repayment of loans from affiliates | 0 | (572) |
Increase (decrease) in securities sold under agreement to repurchase | 0 | (573) |
Other, net | 20 | 0 |
Net cash provided by (used in) financing activities | 2,308 | 3,530 |
Change in cash and cash equivalents | 2,826 | 471 |
Cash and cash equivalents, beginning of year | 1,492 | 2,622 |
Cash and cash equivalents, end of year | 4,318 | 3,093 |
Non-cash transactions: | ||
Right-of-use assets obtained in exchange for lease obligations | $ 14 | $ 7 |
ORGANIZATION
ORGANIZATION | 6 Months Ended |
Jun. 30, 2020 | |
Organization [Abstract] | |
ORGANIZATION | ORGANIZATION Equitable Financial Life Insurance Company’s (“Equitable Financial” and, collectively with its consolidated subsidiaries, the “Company”) primary business is providing variable annuity, life insurance and employee benefit products to both individuals and businesses. The Company is an indirect, wholly-owned subsidiary of Equitable Holdings, Inc. (“Holdings”). Equitable Financial is a stock life insurance company organized in 1859 under the laws of the State of New York. The Company’s two principal subsidiaries include Equitable Distributors, LLC (“Equitable Distributors”) and Equitable Investment Management, LLC (“EIM”). Both Equitable Distributors and EIM are wholly-owned Delaware limited liability companies. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The unaudited interim consolidated financial statements (the “consolidated financial statements”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to the Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments necessary for a fair presentation of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature, with the exception of the Company’s update of its interest rate assumption and adoption of new economic scenario generator as further described below in Assumption Updates and Model Changes. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The accompanying unaudited consolidated financial statements present the consolidated results of operations, financial condition and cash flows of the Company and its subsidiaries and those investment companies, partnerships and joint ventures in which the Company has control and a majority economic interest as well as those variable interest entities (“VIEs”) that meet the requirements for consolidation. All significant intercompany transactions and balances have been eliminated in consolidation. The terms “second quarter 2020” and “second quarter 2019” refer to the three months ended June 30, 2020 and 2019, respectively. The terms “first six months of 2020” and “first six months of 2019” refer to the six months ended June 30, 2020 and 2019, respectively. Certain prior year amounts have been reclassified to conform to the current year’s presentation. Adoption of New Accounting Pronouncements Description Effect on the Financial Statement or Other Significant Matters ASU 2016-13: Financial Instruments—Credit Losses (Topic 326), as clarified and amended by ASU 2018-19: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, ASU 2019-04: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments and ASU 2019-05: Financial Instruments—Credit Losses (Topic 326) Targeted Transition Relief, ASU 2019-11: Codification Improvements to Topic 326, Financial Instruments-Credit Losses ASU 2016-13 contains new guidance which introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. On January 1, 2020, the Company adopted the new standard and completed implementation of its updated current expected credit losses (“CECL”) models, processes and controls related to the identified financial assets that fall within the scope of the new standard. Upon adoption, the Company recorded a cumulative effect adjustment to reduce the opening retained earnings balance by approximately $40 million, on a pre-tax and pre-DAC basis. The adjustment is primarily attributable to an increase in the allowance for credit losses associated with the Company’s commercial and agricultural mortgage loan portfolios and reinsurance. ASU 2018-13 : Fair Value Measurement (Topic 820) This ASU improves the effectiveness of fair value disclosures in the notes to financial statements. Amendments in this ASU impact the disclosure requirements in Topic 820, including the removal, modification and addition to existing disclosure requirements. The Company elected to early adopt during 2019 the removal of disclosures relating to transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for timing of transfers between levels and valuation processes for Level 3 fair value measurements. The Company adopted the additional disclosures related to Level 3 fair value information on January 1, 2020. ASU 2018-17: Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities This ASU provides guidance requiring that indirect interests held through related parties in common control arrangements be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. The Company adopted this new standard effective for January 1, 2020. Adoption of this standard did not materially impact the Company’s financial position or results of operations. Future Adoption of New Accounting Pronouncements Description Effective Date and Method of Adoption Effect on the Financial Statement or Other Significant Matters ASU 2018-12 : Financial Services - Insurance (Topic 944); ASU 2019-09: Financial Services - Insurance (Topic 944): Effective Date This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: In November 2019, ASU 2019-09 was issued which modified ASU 2018-12 to be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. Early adoption is permitted. On July 9, 2020, the FASB issued an exposure draft which proposed a one-year deferral of the effective date of the amendments in ASU 2018-12 for all insurance entities. Early adoption would still be allowed. The Company is currently evaluating the impact that adoption of this guidance will have on the Company’s consolidated financial statements, however the adoption of the ASU is expected to have a significant impact on the Company’s consolidated financial condition, results of operations, cash flows and required disclosures, as well as processes and controls. Description Effective Date and Method of Adoption Effect on the Financial Statement or Other Significant Matters 2. Measurement of market risk benefits (“MRBs”). MRBs, as defined under the ASU, will encompass certain variable annuity guaranteed benefit (“GMxB”) features associated with variable annuity products and other general account annuities with other than nominal market risk. The ASU requires MRBs to be measured at fair value with changes in value attributable to changes in instrument-specific credit risk recognized in Other comprehensive income (“OCI”). For MRBs, the ASU should be applied retrospectively as of the beginning of the earliest period presented. ASU 2019-12: Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes This ASU simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740, as well as clarifying and amending existing guidance. Effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. The Company is currently evaluating the impact adopting the guidance will have on the Company’s consolidated financial statements, however the adoption is not expected to materially impact the Company’s financial position, results of operation, or cash flows. ASU2020-04: Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting The amendments in this ASU provide optional expedients and exceptions to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. This ASU is effective as of March 12, 2020 through December 31, 2022. The Company will determine the applicability of the optional expedients and exceptions provided under the ASU as reference rate reform continues to develop. Investments The carrying values of fixed maturities classified as available-for-sale (“AFS”) are reported at fair value. Changes in fair value are reported in OCI, net of allowance for credit losses, policy related amounts and deferred income taxes. With the adoption of the new Financial Instruments-Credit Losses standard, changes in credit losses are recognized in Investment gains (losses), net. The redeemable preferred stock investments that are reported in fixed maturities include real estate investment trusts (“REIT”), perpetual preferred stock and redeemable preferred stock. These securities may not have a stated maturity, may not be cumulative and do not provide for mandatory redemption by the issuer. The Company determines the fair values of fixed maturities and equity securities based upon quoted prices in active markets, when available, or through the use of alternative approaches when market quotes are not readily accessible or available. These alternative approaches include matrix or model pricing and use of independent pricing services, each supported by reference to principal market trades or other observable market assumptions for similar securities. More specifically, the matrix pricing approach to fair value is a discounted cash flow methodology that incorporates market interest rates commensurate with the credit quality and duration of the investment. The Company’s management, with the assistance of its investment advisors, evaluates AFS debt securities that experienced a decline in fair value below amortized cost for credit losses which are evaluated in accordance with the new financial instruments credit losses guidance effective January 1, 2020. Integral to this review is an assessment made each quarter, on a security-by-security basis, by the Company’s Investments Under Surveillance (“IUS”) Committee, of various indicators of credit deterioration to determine whether the investment security has experienced a credit loss. This assessment includes, but is not limited to, consideration of the severity of the unrealized loss, failure, if any, of the issuer of the security to make scheduled payments, actions taken by rating agencies, adverse conditions specifically related to the security or sector, the financial strength, liquidity and continued viability of the issuer. The Company recognizes an allowance for credit losses on AFS debt securities with a corresponding adjustment to earnings rather than a direct write down that reduces the cost basis of the investment, and credit losses are limited to the amount by which the security’s amortized cost basis exceeds its fair value. Any improvements in estimated credit losses on AFS debt securities are recognized immediately in earnings. Management does not use the length of time a security has been in an unrealized loss position as a factor, either by itself or in combination with other factors, to conclude that a credit loss does not exist, as they were permitted to do prior to January 1, 2020. If there is no intent to sell or likely requirement to dispose of the fixed maturity security before its recovery, only the credit loss component of any resulting allowance is recognized in income (loss) and the remainder of the fair value loss is recognized in OCI. The amount of credit loss is the shortfall of the present value of the cash flows expected to be collected as compared to the amortized cost basis of the security. The present value is calculated by discounting management’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security at the date of acquisition. Projections of future cash flows are based on assumptions regarding probability of default and estimates regarding the amount and timing of recoveries. These assumptions and estimates require use of management judgment and consider internal credit analyses as well as market observable data relevant to the collectability of the security. Write-offs of AFS debt securities are recorded when all or a portion of a financial asset is deemed uncollectible. Full or partial write-offs are recorded as reductions to the amortized cost basis of the AFS debt security and deducted from the allowance in the period in which the financial assets are deemed uncollectible. The Company elected to reverse accrued interest deemed uncollectible as a reversal of interest income. In instances where the Company collects cash that it has previously written off, the recovery will be recognized through earnings or as a reduction of the amortized cost basis for interest and principal, respectively. Real estate held for the production of income is stated at depreciated cost less allowance for credit losses. Depreciation of real estate held for production of income is computed using the straight-line method over the estimated useful lives of the properties, which generally range from 40 to 50 years. Policy loans represent funds loaned to policyholders up to the cash surrender value of the associated insurance policies and are carried at the unpaid principal balances due to the Company from the policyholders. Interest income on policy loans is recognized in net investment income at the contract interest rate when earned. Policy loans are fully collateralized by the cash surrender value of the associated insurance policies. Partnerships, investment companies and joint venture interests that the Company has control of and has an economic interest in or those that meet the requirements for consolidation under accounting guidance for consolidation of VIEs are consolidated. Those that the Company does not have control of and does not have a majority economic interest in and those that do not meet the VIE requirements for consolidation are reported on the equity method of accounting and are reported in other equity investments. The Company records its interests in certain of these partnerships on a month or one quarter lag. Trading securities, which include equity securities and fixed maturities, are carried at fair value based on quoted market prices, with realized and unrealized gains (losses) reported in net investment income (loss) in the consolidated statements of income (loss). Corporate owned life insurance (“COLI”) has been purchased by the Company and certain subsidiaries on the lives of certain key employees and the Company and these subsidiaries are named as beneficiaries under these policies. COLI is carried at the cash surrender value of the policies. At June 30, 2020 and December 31, 2019, the carrying value of COLI was $947 million and $942 million, respectively, and is reported in Other invested assets in the consolidated balance sheets. Cash and cash equivalents includes cash on hand, demand deposits, money market accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less. Due to the short-term nature of these investments, the recorded value is deemed to approximate fair value. All securities owned, including U.S. government and agency securities, mortgage-backed securities, futures and forwards transactions, are reported in the consolidated financial statements on a trade-date basis. Commercial and Agricultural Mortgage Loans on Real Estate Mortgage loans are stated at unpaid principal balances, net of unamortized discounts and the allowance for credit losses. The Company calculates the allowance for credit losses in accordance with the CECL model in order to provide for the risk of credit losses in the lending process. Expected credit losses for loans with similar risk characteristics are estimated on a collective (i.e., pool) basis in order to meet CECL’s risk of loss concept which requires the Company to consider possibilities of loss, even if remote. For collectively evaluated mortgages, the Company estimates the allowance for credit losses based on the amortized cost basis of its mortgages over their expected life using a probability of default (“PD”) / loss given default (“LGD”) model. The PD/LGD model incorporates the Company’s reasonable and supportable forecast of macroeconomic information over a specified period. For periods beyond the reasonable and supportable forecast period, the model reverts to historical loss information. The CECL model is configured to the Company’s specifications and takes into consideration the detailed risk attributes of each discrete loan in the mortgage portfolio which include, but are not limited to the following: • Loan-to-value (“LTV”) ratio - Derived from current loan balance divided by the fair market value of the property. An LTV ratio in excess of 100% indicates an underwater mortgage. • Debt service coverage (“DSC”) ratio - Derived from actual operating earnings divided by annual debt service. If the ratio is below 1.0x, then the income from the property does not support the debt. • Occupancy - Criteria varies by property type but low or below market occupancy is an indicator of sub-par property performance. • Lease expirations - The percentage of leases expiring in the upcoming 12 to 36 months are monitored as a decline in rent and/or occupancy may negatively impact the debt service coverage ratio. In the case of single-tenant properties or properties with large tenant exposure, the lease expiration is a material risk factor. • Other - Any other factors such as maturity, borrower/tenant related issues, payment status, property condition, or current economic conditions may call into question the performance of the loan. Mortgage loans that do not share similar risk characteristics with other loans in the portfolio are individually evaluated quarterly by the Company’s IUS Committee. The allowance for credit losses on these individually evaluated mortgages is a loan-specific reserve as a result of the loan review process that is recorded based on the present value of expected future cash flows discounted at the loan’s effective interest rate or based on the fair value of the collateral. The individually assessed allowance for mortgage loans can increase or decrease from period to period based on such factors. Individually assessed loans may include, but are not limited to, mortgages that have deteriorated in credit quality such as troubled debt restructurings (“TDR”) and reasonably expected TDRs, mortgages for which foreclosure is probable, and mortgages which have been classified as “potential problem” or “problem” loans within the Company’s IUS Committee processes as described below. Within the IUS process, Commercial mortgages 60 days or more past due and agricultural mortgages 90 days or more past due, as well as all mortgages in the process of foreclosure, are identified as problem mortgages. Based on its monthly monitoring of mortgages, a class of potential problem mortgages are also identified, consisting of mortgage loans not currently classified as problem mortgages but for which management has doubts as to the ability of the borrower to comply with the present loan payment terms and which may result in the loan becoming a problem or being modified. The decision whether to classify a performing mortgage loan as a potential problem involves judgments by management as to likely future industry conditions and developments with respect to the borrower or the individual mortgaged property. Individually assessed mortgage loans without provision for losses are mortgage loans where the fair value of the collateral or the net present value of the expected future cash flows related to the loan equals or exceeds the recorded investment. Interest income earned on mortgage loans where the collateral value is used to measure impairment is recorded on a cash basis. Interest income on mortgage loans where the present value method is used to measure impairment is accrued on the net carrying value amount of the loan at the interest rate used to discount the cash flows. Mortgage loans are placed on nonaccrual status once management believes the collection of accrued interest is not probable. Once mortgage loans are classified as nonaccrual mortgage loans, interest income is recognized under the cash basis of accounting and the resumption of the interest accrual would commence only after all past due interest has been collected or the mortgage loan has been restructured to where the collection of interest is considered likely. The Company charges off loan balances and accrued interest that are deemed uncollectible. Net Investment Income (Loss), Investment Gains (Losses), Net, and Unrealized Investment Gains (Losses) Realized investment gains (losses) are determined by identification with the specific asset and are presented as a component of revenue. Changes in the allowance for credit losses are included in Investment gains (losses), net. Realized and unrealized holding gains (losses) on trading and equity securities are reflected in Net investment income (loss). Unrealized investment gains (losses) on fixed maturities designated as AFS held by the Company are accounted for as a separate component of AOCI, net of related deferred income taxes, as are amounts attributable to certain pension operations, Closed Block’s policyholders’ dividend obligation, insurance liability loss recognition, DAC related to UL policies, investment-type products and participating traditional life policies. Changes in unrealized gains (losses) reflect changes in fair value of only those fixed maturities classified as AFS and do not reflect any change in fair value of policyholders’ account balances and future policy benefits. Accounting and Consolidation of VIEs For all new investment products and entities developed by the Company (other than Collateralized Debt Obligations (“CDOs”)), the Company first determines whether the entity is a VIE, which involves determining an entity’s variability and variable interests, identifying the holders of the equity investment at risk and assessing the five characteristics of a VIE. Once an entity has been determined to be a VIE, the Company then identifies the primary beneficiary of the VIE. If the Company is deemed to be the primary beneficiary of the VIE, then the Company consolidates the entity. Management of the Company reviews quarterly its investment management agreements and its investments in, and other financial arrangements with, certain entities that hold client assets under management (“AUM”) to determine the entities that the Company is required to consolidate under this guidance. These entities include certain mutual fund products, hedge funds, structured products, group trusts, collective investment trusts and limited partnerships. The analysis performed to identify variable interests held, determine whether entities are VIEs or voting interest entities (“VOEs”), and evaluate whether the Company has a controlling financial interest in such entities requires the exercise of judgment and is updated on a continuous basis as circumstances change or new entities are developed. The primary beneficiary evaluation generally is performed qualitatively based on all facts and circumstances, including consideration of economic interests in the VIE held directly and indirectly through related parties and entities under common control, as well as quantitatively, as appropriate. Consolidated VIEs At June 30, 2020 and December 31, 2019, the Company consolidated one real estate joint venture for which it was identified as the primary beneficiary under the VIE model. The consolidated entity is jointly owned by Equitable Financial and AXA France and holds an investment in a real estate venture. Included in Other invested assets in the Company’s consolidated balance sheets at June 30, 2020 and December 31, 2019 are total assets o f $30 million an d $32 million, respectively related to this VIE, primarily resulting from the consolidated presentation of this real estate joint venture as real estate held for sale. Redeemable noncontrolling interests are presented in mezzanine equity and non-redeemable noncontrolling interests are presented within permanent equity. Non-Consolidated VIEs At June 30, 2020 and December 31, 2019, respectively, the Company held approximately $1.1 billion and $1.1 billion of investment assets in the form of equity interests issued by non-corporate legal entities determined under the guidance to be VIEs, such as limited partnerships and limited liability companies, including hedge funds, private equity funds and real estate-related funds. As an equity investor, the Company is considered to have a variable interest in each of these VIEs as a result of its participation in the risks and/or rewards these funds were designed to create by their defined portfolio objectives and strategies. Primarily through qualitative assessment, including consideration of related party interests or other financial arrangements, if any, the Company was not identified as primary beneficiary of any of these VIEs, largely due to its inability to direct the activities that most significantly impact their economic performance. Consequently, the Company continues to reflect these equity interests in the consolidated balance sheets as Other equity investments and applies the equity method of accounting for these positions. The net assets of these non-consolidated VIEs are approximately $146.6 billion and $160.2 billion at June 30, 2020 and December 31, 2019, respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is the carrying value of its investment of $1.1 billion and $1.1 billion and approximately $1.2 billion and $1.1 billion of unfunded commitments at June 30, 2020 and December 31, 2019, respectively. The Company has no further economic interest in these VIEs in the form of guarantees, derivatives, credit enhancements or similar instruments and obligations. In addition, at June 30, 2020 and December 31, 2019, Other invested assets includes real estate held for sale of $(5) million and $(5) million, respectively, as related to one non-consolidated real estate joint venture. Assumption Updates and Model Changes The Company conducts its annual review of its assumptions and models during the third quarter of each year. The annual review encompasses assumptions underlying the valuation of unearned revenue liabilities, embedded derivatives for our insurance business, liabilities for future policyholder benefits, DAC and deferred sales inducement (“DSI”) assets. However, the Company updates its assumptions as needed in the event it becomes aware of economic conditions or events that could require a change in assumptions that it believes may have a significant impact to the carrying value of product liabilities and assets and consequently materially impact its earnings in the period of the change. In the first quarter of 2020, due to the extraordinary economic conditions driven by the COVID-19 pandemic, the Company updated its interest rate assumption to grade from the current interest rate environment to an ultimate five-year historical average over a 10-year period. As such, the 10-year U.S. Treasury yield grades from the current level to an ultimate 5-year average of 2.25%. The Company determined that no assumption updates were necessary in the second quarter of 2020. The low interest rate environment and update to the interest rate assumption caused a loss recognition event for the Company’s life interest-sensitive products, as well as to certain run-off business. This loss recognition event caused an acceleration of DAC amortization on the life interest-sensitive products and an increase in the premium deficiency reserve on the run-off business in the first quarter of 2020. The net impact of the economic assumption update in the first six months of 2020 increased Policyholders’ benefits by $1.3 billion, increased Amortization of DAC by $861 million, increased Policy charges and fee income by $54 million and decreased Interest credited to policyholders’ account balances by $6 million. This resulted in a decrease in Income (loss) from continuing operations, before income taxes of $2.1 billion and decreased Net income (loss) of $1.7 billion. Also in the first quarter of 2020, the Company adopted a new economic scenario generator to calculate the fair value of the GMIB reinsurance contract asset and GMxB derivative features liability, eliminating reliance on AXA Group for scenario production. The new economic scenario generator allows for a tighter calibration of U.S. indices, better reflecting the Company’s actual portfolio. The net impact of the new economic scenario generator resulted in an increase in Income |
INVESTMENTS
INVESTMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | INVESTMENTS Fixed Maturities Available-for-Sale Accounting for credit impairments of fixed maturities classified as AFS has changed from a direct write-down, or other-than-temporary impairment (“OTTI”) approach to an allowance for credit loss model starting in 2020 upon adoption of CECL (see Note 2, Significant Accounting Policies – Investments). The components of fair value and amortized cost for fixed maturities classified as AFS on the consolidated balance sheets excludes accrued interest receivable because the Company elected to present accrued interest receivable within Other assets. Accrued interest receivable on AFS fixed maturities at June 30, 2020 was $480 million. When the Company determines that there is more than 50% likelihood that it is not going to recover the principal and interest cash flows related to an AFS debt security, the security is placed on nonaccrual status and the Company reverses accrued interest receivable against interest income. Since the nonaccrual policy results in a timely reversal of accrued interest receivable, the Company does not record an allowance for credit losses on accrued interest receivable. There was no accrued interest written off for AFS fixed maturities for the three and six months ended June 30, 2020. Comparative tables as of December 31, 2019 include OTTI, reported net of tax in OCI and in AOCI until realized. The following tables provide information relating to the Company’s fixed maturities classified as AFS. AFS Fixed Maturities by Classification Amortized Allowance for Credit Losses (4) Gross Gross Fair Value (in millions) June 30, 2020: Fixed Maturities: Corporate (1) $ 45,706 $ 13 $ 4,091 $ 154 $ 49,630 U.S. Treasury, government and agency 13,103 — 4,090 — 17,193 States and political subdivisions 607 — 105 — 712 Foreign governments 770 — 69 6 833 Residential mortgage-backed (2) 144 — 14 — 158 Asset-backed (3) 2,057 — 23 41 2,039 Commercial mortgage-backed 855 — 24 — 879 Redeemable preferred stock 373 — 15 10 378 Total at June 30, 2020 $ 63,615 $ 13 $ 8,431 $ 211 $ 71,822 December 31, 2019: Fixed Maturities: Corporate (1) $ 42,347 $ — $ 2,178 $ 61 $ 44,464 U.S. Treasury, government and agency 14,385 — 1,151 305 15,231 States and political subdivisions 584 — 68 3 649 Foreign governments 460 — 35 5 490 Residential mortgage-backed (2) 161 — 12 — 173 Asset-backed (3) 843 — 3 2 844 Redeemable preferred stock 498 — 18 5 511 Total at December 31, 2019 $ 59,278 $ — $ 3,465 $ 381 $ 62,362 ______________ (1) Corporate fixed maturities include both public and private issues. (2) Includes publicly traded agency pass-through securities and collateralized obligations. (3) Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans. (4) Amounts represent the allowance for credit losses for 2020 - (see Note 2 Significant Accounting Policies - Investments). The contractual maturities of AFS fixed maturities at June 30, 2020 are shown in the table below. Bonds not due at a single maturity date have been included in the table in the final year of maturity. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Contractual Maturities of AFS Fixed Maturities Amortized Cost (Less Allowance for Credit Losses) Fair Value (in millions) June 30, 2020 (1): Contractual maturities: Due in one year or less $ 4,393 $ 4,433 Due in years two through five 14,167 14,944 Due in years six through ten 16,475 18,256 Due after ten years 25,138 30,735 Subtotal 60,173 68,368 Residential mortgage-backed 144 158 Asset-backed 2,057 2,039 Commercial mortgage-backed 855 879 Redeemable preferred stock 373 378 Total at June 30, 2020 $ 63,602 $ 71,822 ______________ (1) Net amortized cost is equal to amortized cost, less any allowance for credit losses to the extent applicable. The following table shows proceeds from sales, gross gains (losses) from sales and credit losses for AFS fixed maturities for the three and six months ended June 30, 2020 and 2019: Proceeds from Sales, Gross Gains (Losses) from Sales and Credit Losses for AFS Fixed Maturities Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Proceeds from sales $ 2,864 $ 1,556 $ 4,586 $ 2,917 Gross gains on sales $ 205 $ 9 $ 274 $ 17 Gross losses on sales $ (24) $ (6) $ (27) $ (21) Credit losses (1) $ (11) $ — $ (13) $ — ______________ (1) Commencing with the Company’s adoption of ASU 2016-13 on January 1, 2020, credit losses on AFS debt securities were recognized as an allowance for credit losses. In 2019 and prior, credit losses on AFS fixed maturities were recognized as OTTI. The following table sets forth the amount of credit loss impairments on AFS fixed maturities held by the Company at the dates indicated and the corresponding changes in such amounts. AFS Fixed Maturities - Credit Loss Impairments Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Balance, beginning of period $ (17) $ (18) $ (15) $ (46) Previously recognized impairments on securities that matured, paid, prepaid or sold — — — 28 Recognized impairments on securities impaired to fair value this period (1) — — — — Credit losses recognized this period on securities for which credit losses were not previously recognized (8) — (10) — Additional credit losses this period on securities previously impaired (3) — (3) — Increases due to passage of time on previously recorded credit losses — — — — Accretion of previously recognized impairments due to increases in expected cash flows (for OTTI securities 2019 and prior) — — — — Balance at June 30, $ (28) $ (18) $ (28) $ (18) ______________ (1) Represents circumstances where the Company determined in the current period that it intends to sell the security, or it is more likely than not that it will be required to sell the security before recovery of the security’s amortized cost. Net unrealized investment gains (losses) on AFS fixed maturities are included in the consolidated balance sheets as a component of AOCI. Changes in net unrealized investment gains (losses) recognized in AOCI include reclassification adjustments to reflect amounts realized in Net income (loss) for the current period that had been part of OCI in earlier periods. The tables that follow below present a roll-forward of net unrealized investment gains (losses) recognized in AOCI, split between amounts related to fixed maturities on which a credit loss has been recognized, and all other. Net Unrealized Gains (Losses) on AFS Fixed Maturities Net Unrealized Gains (Losses) on Investments DAC Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) (in millions) Balance, April 1, 2020 $ 5,040 $ (205) $ (1,003) $ (805) $ 3,027 Net investment gains (losses) arising during the period 3,336 — — — 3,336 Reclassification adjustment: — Included in Net income (loss) (167) — — — (167) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — (289) — — (289) Deferred income taxes — — — (437) (437) Policyholders’ liabilities — — (799) — (799) Net unrealized investment gains (losses) excluding credit losses 8,209 (494) (1,802) (1,242) 4,671 Net unrealized investment gains (losses) with credit losses (2) — 1 — (1) Balance, June 30, 2020 $ 8,207 $ (494) $ (1,801) $ (1,242) $ 4,670 Balance, April 1, 2019 $ 1,003 $ (616) $ 22 $ (86) $ 323 Net investment gains (losses) arising during the period 1,623 — — — 1,623 Reclassification adjustment: — Included in Net income (loss) (4) — — — (4) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — 82 — — 82 Deferred income taxes — — — (334) (334) Policyholders’ liabilities — — (108) — (108) Net unrealized investment gains (losses) excluding credit losses 2,622 (534) (86) (420) 1,582 Net unrealized investment gains (losses) with credit losses (1) 2 — — — 2 Balance, June 30, 2019 $ 2,624 $ (534) $ (86) $ (420) $ 1,584 Net Unrealized Gains (Losses) on Investments DAC Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) (in millions) Balance, January 1, 2020 $ 3,084 $ (831) $ (192) $ (433) $ 1,628 Net investment gains (losses) arising during the period 5,362 — — — 5,362 Reclassification adjustment: — Included in Net income (loss) (230) — — — (230) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — 336 — — 336 Net Unrealized Gains (Losses) on Investments DAC Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) (in millions) Deferred income taxes — — — (810) (810) Policyholders’ liabilities — — (1,611) — (1,611) Net unrealized investment gains (losses) excluding credit losses 8,216 (495) (1,803) (1,243) 4,675 Net unrealized investment gains (losses) with credit losses (9) 1 2 1 (5) Balance, June 30, 2020 $ 8,207 $ (494) $ (1,801) $ (1,242) $ 4,670 Balance, January 1, 2019 $ (577) $ 39 $ (55) $ 125 $ (468) Net investment gains (losses) arising during the period 3,206 — — — 3,206 Reclassification adjustment: Included in Net income (loss) (7) — — — (7) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — (573) — — (573) Deferred income taxes — — — (545) (545) Policyholders’ liabilities — — (31) — (31) Net unrealized investment gains (losses) excluding credit losses 2,622 (534) (86) (420) 1,582 Net unrealized investment gains (losses) with credit losses (1) 2 — — — 2 Balance, June 30, 2019 $ 2,624 $ (534) $ (86) $ (420) $ 1,584 ______________ (1) Credit losses for 2019 were OTTI losses. The following tables disclose the fair values and gross unrealized losses of the 639 issues at June 30, 2020 and the 390 issues at December 31, 2019 that are not deemed to have credit losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the specified periods at the dates indicated: AFS Fixed Maturities in an Unrealized Loss Position for Which No Allowance Is Recorded Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in millions) June 30, 2020: Fixed Maturities: Corporate $ 2,511 $ 96 $ 273 $ 51 $ 2,784 $ 147 Foreign governments 47 6 — — 47 6 Asset-backed 1,349 37 73 4 1,422 41 Redeemable preferred stock 121 8 11 2 132 10 Total at June 30, 2020 $ 4,028 $ 147 $ 357 $ 57 $ 4,385 $ 204 December 31, 2019: (1) Fixed Maturities: Corporate $ 2,669 $ 41 $ 366 $ 20 $ 3,035 $ 61 Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in millions) U.S. Treasury, government and agency 4,245 305 2 — 4,247 305 States and political subdivisions 123 3 — — 123 3 Foreign governments 11 — 47 5 58 5 Asset-backed 319 — 201 2 520 2 Redeemable preferred stock 29 — 49 5 78 5 Total at December 31, 2019 $ 7,396 $ 349 $ 665 $ 32 $ 8,061 $ 381 ______________ (1) Amounts represents fixed maturities in an unrealized loss position that are not deemed to be other-than-temporarily impaired for 2019. The Company’s investments in fixed maturities do not include concentrations of credit risk of any single issuer greater than 10% of the consolidated equity of the Company, other than securities of the U.S. government, U.S. government agencies, and certain securities guaranteed by the U.S. government. The Company maintains a diversified portfolio of corporate securities across industries and issuers and does not have exposure to any single issuer in excess of 0.6% of total corporate securities. The largest exposures to a single issuer of corporate securities held at June 30, 2020 and December 31, 2019 were $318 million and $279 million, respectively, representing 2.1% and 2.4% of the consolidated equity of the Company. Corporate high yield securities, consisting primarily of public high yield bonds, are classified as other than investment grade by the various rating agencies, i.e., a rating below Baa3/BBB- or the National Association of Insurance Commissioners (“NAIC”) designation of 3 (medium investment grade), 4 or 5 (below investment grade) or 6 (in or near default). At June 30, 2020 and December 31, 2019, respectively, approximately $1.9 billion and $1.4 billion, or 3.0% and 2.3%, of the $63.6 billion and $59.3 billion aggregate amortized cost of fixed maturities held by the Company were considered to be other than investment grade. These securities had gross unrealized losses of $112 million and $21 million at June 30, 2020 and December 31, 2019, respectively. At June 30, 2020 and December 31, 2019, respectively, the $57 million and $32 million of gross unrealized losses of twelve months or more were concentrated in corporate securities, as applicable. In accordance with the policy described in Note 2, the Company concluded that an adjustment to income for OTTI (prior to January 1, 2020) nor an allowance for credit losses (after January 1, 2020) for these securities was not warranted at either June 30, 2020 or December 31, 2019. At June 30, 2020 and December 31, 2019, the Company did not intend to sell the securities nor will it likely be required to dispose of the securities before the anticipated recovery of their remaining amortized cost basis. Based on the Company’s evaluation both qualitatively and quantitatively of the drivers of the decline in fair value of fixed maturity securities as of June 30, 2020, the Company determined that the unrealized loss was primarily due to increases in credit spreads and changes in credit ratings due to the impact of the COVID-19 pandemic on financial markets and assessments of fundamental risks. Mortgage Loans The Company utilizes a PD/LGD model, configured in accordance with the Company’s policies that meet the concepts in the CECL framework, to estimate expected credit losses for mortgage loans as a product of PD, LGD and the exposure at default across various economic scenarios. The PD and LGD are estimated at the loan-level based on loans’ current and forecasted risk characteristics as well as macroeconomic forecasts. The PD is estimated using both macroeconomic conditions as well as individual loan risk characteristics including LTV ratios, DSC ratios, seasoning, collateral type, geography, and underlying credit. The LGD is driven primarily by the type and value of collateral, and secondarily by expected liquidation costs and time to recovery. The model also incorporates the Company’s reasonable and supportable forecasts of the macroeconomic variables deemed to be correlated to the credit risk of its loans. The length of the reasonable and supportable forecast period is reassessed on a quarterly basis and may be adjusted as appropriate over time to be consistent with macroeconomic conditions and the environment as of the reporting date. Reversion to historical loss information is performed for periods beyond the reasonable and supportable forecast period. The components of amortized cost for mortgage loans on the consolidated balance sheets excludes accrued interest amounts because the Company presents accrued interest receivables within Other assets. Accrued interest receivable on commercial and agricultural mortgage loans at June 30, 2020 was $28 million and $29 million, respectively. Accrued interest of $1 million was written off for the three and six months ended June 30, 2020 for commercial mortgage loans. There was no accrued interest written off for agricultural mortgage loans for the three and six months ended June 30, 2020. Once mortgage loans are placed on nonaccrual status, the Company reverses accrued interest receivable against interest income. Since the nonaccrual policy results in the timely reversal of accrued interest receivable, the Company does not record an allowance for credit losses on accrued interest receivable. At June 30, 2020, the Company had no loans for which foreclosure was probable included within the individually assessed mortgage loans, and accordingly had no associated allowance for credit losses. Allowance for Credit Losses on Mortgage Loans The change in the allowance for credit losses for commercial mortgage loans and agricultural mortgage loans during the three and six months ended June 30, 2020 was as follows: Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 (in millions) Allowance for credit losses on mortgage loans (1): Commercial mortgages: Balance, beginning of period $ (43) $ (33) Current-period provision for expected credit losses (19) (29) Write-offs charged against the allowance — — Recoveries of amounts previously written off — — Net change in allowance (19) (29) Ending Balance, June 30, $ (62) $ (62) Agricultural mortgages: Balance, beginning of period $ (3) $ (3) Current-period provision for expected credit losses (1) (1) Write-offs charged against the allowance — — Recoveries of amounts previously written off — — Net change in allowance (1) (1) Ending Balance, June 30, $ (4) $ (4) Total allowance for credit losses $ (66) $ (66) ____________ (1) See Note 2 for discussion of the transition balance. The change in the allowance for credit losses is attributable to: • increases/decreases in the loan balance due to new originations, maturing mortgages, and loan amortization; • changes in credit quality; and • changes in market assumptions primarily related to COVID-19 driven economic changes. Credit Quality Information The following tables summarize the Company’s mortgage loans segregated by risk rating exposure at June 30, 2020. LTV Ratios (1)(3) At June 30, 2020 Amortized Cost Basis by Origination Year 2020 2019 2018 2017 2016 Prior Total (in millions) Mortgage loans: Commercial: 0% - 50% $ — $ — $ 29 $ 324 $ 196 $ 748 $ 1,297 50% - 70% 656 613 915 759 2,501 1,714 7,158 70% - 90% 90 184 304 113 58 464 1,213 90% plus — — — 5 — 156 161 Total commercial $ 746 $ 797 $ 1,248 $ 1,201 $ 2,755 $ 3,082 $ 9,829 Agricultural: 0% - 50% $ 106 $ 139 $ 159 $ 167 $ 254 $ 733 $ 1,558 50% - 70% 204 139 186 112 129 394 1,164 70% - 90% — — 3 — — 18 21 90% plus — — — — — — — Total agricultural $ 310 $ 278 $ 348 $ 279 $ 383 $ 1,145 $ 2,743 Total mortgage loans: 0% - 50% $ 106 $ 139 $ 188 $ 491 $ 450 $ 1,481 $ 2,855 50% - 70% 860 752 1,101 871 2,630 2,108 8,322 70% - 90% 90 184 307 113 58 482 1,234 90% plus — — — 5 — 156 161 Total mortgage loans $ 1,056 $ 1,075 $ 1,596 $ 1,480 $ 3,138 $ 4,227 $ 12,572 Debt Service Coverage Ratios (2)(3) At June 30, 2020 Amortized Cost Basis by Origination Year 2020 2019 2018 2017 2016 Prior Total (in millions) Mortgage loans: Commercial: Greater than 2.0x $ 621 $ 373 $ 800 $ 377 $ 2,134 $ 1,315 $ 5,620 1.8x to 2.0x 90 187 123 409 70 484 1,363 1.5x to 1.8x 35 183 230 302 551 610 1,911 1.2x to 1.5x — 12 12 76 — 673 773 1.0x to 1.2x — 42 83 37 — — 162 Less than 1.0x — — — — — — — Total commercial $ 746 $ 797 $ 1,248 $ 1,201 $ 2,755 $ 3,082 $ 9,829 Agricultural Greater than 2.0x $ 43 $ 28 $ 39 $ 37 $ 76 $ 162 $ 385 1.8x to 2.0x 11 36 15 17 21 91 191 1.5x to 1.8x 75 39 46 43 52 232 487 1.2x to 1.5x 110 126 148 110 158 349 1,001 1.0x to 1.2x 67 39 92 71 58 275 602 Less than 1.0x 4 10 8 1 18 36 77 Total agricultural $ 310 $ 278 $ 348 $ 279 $ 383 $ 1,145 $ 2,743 At June 30, 2020 Amortized Cost Basis by Origination Year 2020 2019 2018 2017 2016 Prior Total (in millions) Total mortgage loans Greater than 2.0x $ 664 $ 401 $ 839 $ 414 $ 2,210 $ 1,477 $ 6,005 1.8x to 2.0x 101 223 138 426 91 575 1,554 1.5x to 1.8x 110 222 276 345 603 842 2,398 1.2x to 1.5x 110 138 160 186 158 1,022 1,774 1.0x to 1.2x 67 81 175 108 58 275 764 Less than 1.0x 4 10 8 1 18 36 77 Total mortgage loans $ 1,056 $ 1,075 $ 1,596 $ 1,480 $ 3,138 $ 4,227 $ 12,572 _____________ (1) The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan. (2) The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service. (3) Amounts presented at amortized cost basis. The following tables provide information relating to the LTV and DSC ratios for commercial and agricultural mortgage loans at June 30, 2020 and December 31, 2019. The values used in these ratio calculations were developed as part of the periodic review of the commercial and agricultural mortgage loan portfolio, which includes an evaluation of the underlying collateral value. Mortgage Loans by LTV and DSC Ratios DSC Ratio (2) (3) LTV Ratio (1) (3): Greater than 2.0x 1.8x to 2.0x 1.5x to 1.8x 1.2x to 1.5x 1.0x to 1.2x Less than 1.0x Total (in millions) June 30, 2020: Mortgage loans: Commercial: 0% - 50% $ 1,016 $ 20 $ 237 $ 24 $ — $ — $ 1,297 50% - 70% 4,208 1,080 1,353 485 32 — 7,158 70% - 90% 312 263 321 187 130 — 1,213 90% plus 84 — — 77 — — 161 Total commercial $ 5,620 $ 1,363 $ 1,911 $ 773 $ 162 $ — $ 9,829 Agricultural: 0% - 50% $ 292 $ 106 $ 255 $ 520 $ 333 $ 52 $ 1,558 50% - 70% 93 83 232 462 269 25 1,164 70% - 90% — 2 — 19 — — 21 90% plus — — — — — — — Total agricultural $ 385 $ 191 $ 487 $ 1,001 $ 602 $ 77 $ 2,743 Total mortgage loans: 0% - 50% $ 1,308 $ 126 $ 492 $ 544 $ 333 $ 52 $ 2,855 50% - 70% 4,301 1,163 1,585 947 301 25 8,322 70% - 90% 312 265 321 206 130 — 1,234 90% plus 84 — — 77 — — 161 Total mortgage loans $ 6,005 $ 1,554 $ 2,398 $ 1,774 $ 764 $ 77 $ 12,572 DSC Ratio (2) (3) LTV Ratio (1) (3): Greater than 2.0x 1.8x to 2.0x 1.5x to 1.8x 1.2x to 1.5x 1.0x to 1.2x Less than 1.0x Total (in millions) December 31, 2019: Mortgage loans: Commercial: 0% - 50% $ 887 $ 38 $ 214 $ 24 $ — $ — $ 1,163 50% - 70% 4,097 1,195 1,118 795 242 — 7,447 70% - 90% 251 98 214 154 46 — 763 90% plus — — — — — — — Total commercial $ 5,235 $ 1,331 $ 1,546 $ 973 $ 288 $ — $ 9,373 Agricultural: 0% - 50% $ 322 $ 104 $ 241 $ 545 $ 321 $ 50 $ 1,583 50% - 70% 82 87 236 426 251 33 1,115 70% - 90% — — — 19 — — 19 90% plus — — — — — — — Total agricultural $ 404 $ 191 $ 477 $ 990 $ 572 $ 83 $ 2,717 Total mortgage loans: 0% - 50% $ 1,209 $ 142 $ 455 $ 569 $ 321 $ 50 $ 2,746 50% - 70% 4,179 1,282 1,354 1,221 493 33 8,562 70% - 90% 251 98 214 173 46 — 782 90% plus — — — — — — — Total mortgage loans $ 5,639 $ 1,522 $ 2,023 $ 1,963 $ 860 $ 83 $ 12,090 ______________ (1) The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan. (2) The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service. (3) Amounts presented at amortized cost basis. Past-Due and Nonaccrual Mortgage Loan Status The following table provides information relating to the aging analysis of past-due mortgage loans at June 30, 2020 and December 31, 2019, respectively: Age Analysis of Past Due Mortgage Loans (1) Accruing Loans Non-accruing Loans Total Loans Non-accruing Loans with No Allowance Interest Income on Non-accruing Loans(2) Past Due Current Total 30-59 Days 60-89 Days 90 Days or More Total (in millions) June 30, 2020: Mortgage loans: Commercial $ — $ — $ — $ — $ 9,754 $ 9,754 $ 75 $ 9,829 $ 75 $ 1 Agricultural 67 9 49 125 2,618 2,743 — 2,743 — — Total $ 67 $ 9 $ 49 $ 125 $ 12,372 $ 12,497 $ 75 $ 12,572 $ 75 $ 1 December 31, 2019: Accruing Loans Non-accruing Loans Total Loans Non-accruing Loans with No Allowance Interest Income on Non-accruing Loans(2) Past Due Current Total 30-59 Days 60-89 Days 90 Days or More Total (in millions) Mortgage loans: Commercial $ — $ — $ — $ — $ 9,373 $ 9,373 $ — $ 9,373 $ — $ — Agricultural 57 1 66 124 2,593 2,717 — 2,717 — — Total $ 57 $ 1 $ 66 $ 124 $ 11,966 $ 12,090 $ — $ 12,090 $ — $ — _______________ (1) Amounts presented at amortized cost basis. (2) Amounts for 2020 represent results for both the three and six months ended June 30, 2020. At June 30, 2020 and December 31, 2019, the carrying values of problem mortgage loans that had been classified as non-accrual loans were $75 million and $0 million, respectively. Troubled Debt Restructuring The Company invests in commercial and agricultural mortgage loans included in the balance sheet as Mortgage loans on real estate and privately negotiated fixed maturities included in the balance sheet as Fixed maturities AFS. Under certain circumstances, modifications are granted to these contracts. Each modification is evaluated as to whether a troubled debt restructuring has occurred. A modification is a troubled debt restructuring when the borrower is in financial difficulty and the creditor makes concessions. Generally, the types of concessions may include reducing the face amount or maturity amount of the debt as originally stated, reducing the contractual interest rate, extending the maturity date at an interest rate lower than current market interest rates and/or reducing accrued interest. The Company considers the amount, timing and extent of the concession granted in determining any impairment or changes in the specific credit allowance recorded in connection with the troubled debt restructuring. A credit allowance may have been recorded prior to the quarter when the loan is modified in a troubled debt restructuring. Accordingly, the carrying value (net of the allowance) before and after modification through a troubled debt restructuring may not change significantly, or may increase if the expected recovery is higher than the pre-modification recovery assessment. At June 30, 2020, the Company did not have any commercial or agricultural mortgage loans accounted for as troubled debt restructurings. At June 30, 2020, the Company had four new privately negotiated fixed maturity troubled debt restructurings with a pre-modification cost basis of $42 million and post-modification carrying value of $37 million, these troubled debt restructurings did not have subsequent payment defaults nor additional commitments to lend. The four privately negotiated fixed maturity troubled debt restructurings are 0.04% of the Company’s total invested assets. Trading Securities At June 30, 2020 and December 31, 2019, respectively, the fair value of the Company’s trading securities was $6.1 billion and $6.6 billion. At June 30, 2020 and December 31, 2019, respectively, trading securities included the General Account’s investment in Separate Accounts, which had carrying values of $38 million and $58 million. Net unrealized and realized gains (losses) on trading securities are included in Net investment income (loss) in the Consolidated Statements of Income (Loss). The table below shows a breakdown of Net investment income (loss) from trading securities during the three and six months ended June 30, 2020 and 2019: Net Investment Income (Loss) from Trading Securities Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Net investment gains (losses) recognized during the period on securities held at the end of the period $ 250 $ 150 $ 87 $ 424 Net investment gains (losses) recognized on securities sold during the period 14 1 17 (23) Unrealized and realized gains (losses) on trading securities 264 151 104 401 Interest and dividend income from trading securities 45 71 94 161 Net investment income (loss) from trading securities $ 309 $ 222 $ 198 $ 562 |
DERIVATIVES
DERIVATIVES | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | DERIVATIVES The Company uses derivatives as part of its overall asset/liability risk management primarily to reduce exposures to equity market and interest rate risks. Derivative hedging strategies are designed to reduce these risks from an economic perspective and are all executed within the framework of a “Derivative Use Plan” approved by applicable states’ insurance law. Derivatives are generally not accounted for using hedge accounting, with the exception of Treasury Inflation-Protected Securities (“TIPS”), which is discussed further below. Operation of these hedging programs is based on models involving numerous estimates and assumptions, including, among others, mortality, lapse, surrender and withdrawal rates, election rates, fund performance, market volatility and interest rates. A wide range of derivative contracts are used in these hedging programs, including exchange traded equity, currency and interest rate futures contracts, total return and/or other equity swaps, interest rate swap and floor contracts, bond and bond-index total return swaps, swaptions, variance swaps and equity options, credit and foreign exchange derivatives, as well as bond and repo transactions to support the hedging. The derivative contracts are collectively managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in capital markets. In addition, as part of its hedging strategy, the Company targets an asset level for all variable annuity products at or above a CTE98 level under most economic scenarios (Conditional Tail Expectation, or “CTE”, is a statistical measure of tail risk which quantifies the total asset requirement to sustain a loss if an event outside a given probability level has occurred. CTE98 denotes the financial resources a company would need to cover the average of the worst 2% of scenarios.) Derivatives Utilized to Hedge Exposure to Variable Annuities with Guarantee Features The Company has issued and continues to offer variable annuity products with GMxB features. The risk associated with the GMDB feature is that under-performance of the financial markets could result in GMDB benefits, in the event of death, being higher than what accumulated policyholders’ account balances would support. The risk associated with the GMIB feature is that under-performance of the financial markets could result in the present value of GMIB, in the event of annuitization, being higher than what accumulated policyholders’ account balances would support, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. The risk associated with products that have a GMxB derivative features liability is that under-performance of the financial markets could result in the GMxB derivative features’ benefits being higher than what accumulated policyholders’ account balances would support. For GMxB features, the Company retains certain risks including basis, credit spread and some volatility risk and risk associated with actual versus expected actuarial assumptions for mortality, lapse and surrender, withdrawal and policyholder election rates, among other things. The derivative contracts are managed to correlate with changes in the value of the GMxB features that result from financial markets movements. A portion of exposure to realized equity volatility is hedged using equity options and variance swaps and a portion of exposure to credit risk is hedged using total return swaps on fixed income indices. Additionally, the Company is party to total return swaps for which the reference U.S. Treasury securities are contemporaneously purchased from the market and sold to the swap counterparty. As these transactions result in a transfer of control of the U.S. Treasury securities to the swap counterparty, the Company derecognizes these securities with consequent gain or loss from the sale. The Company has also purchased reinsurance contracts to mitigate the risks associated with GMDB features and the impact of potential market fluctuations on future policyholder elections of GMIB features contained in certain annuity contracts issued by the Company. The reinsurance of the GMIB features is accounted for as a derivative. The Company has in place an economic hedge program using interest rate swaps and U.S. Treasury futures to partially protect the overall profitability of future variable annuity sales against declining interest rates. Derivatives Utilized to Hedge Crediting Rate Exposure on SCS, SIO, MSO and IUL Products/Investment Options The Company hedges crediting rates in the Structured Capital Strategies (“SCS”) variable annuity, Structured Investment Option in the EQUI-VEST variable annuity series (“SIO”), Market Stabilizer Option (“MSO”) in the variable life insurance products and Indexed Universal Life (“IUL”) insurance products. These products permit the contract owner to participate in the performance of an index, Exchange Traded Funds (“ETF”) or commodity price movement up to a cap for a set period of time. They also contain a protection feature, in which the Company will absorb, up to a certain percentage, the loss of value in an index, ETF or commodity price, which varies by product segment. In order to support the returns associated with these features, the Company enters into derivative contracts whose payouts, in combination with fixed income investments, emulate those of the index, ETF or commodity price, subject to caps and buffers, thereby substantially reducing any exposure to market-related earnings volatility. Derivatives Used to Hedge Equity Market Risks Associated with the General Account’s Seed Money Investments in Retail Mutual Funds The Company’s General Account seed money investments in retail mutual funds expose us to market risk, including equity market risk which is partially hedged through equity-index futures contracts to minimize such risk. Derivatives Used to Hedge Universal Life Products with Secondary Guarantee (“ULSG”) Policy The Company implemented a hedge program using fixed income total return swaps to mitigate the interest rate exposure in the ULSG policy statutory liability. Derivatives Used for General Account Investment Portfolio The Company maintains a strategy in its General Account investment portfolio to replicate the credit exposure of fixed maturity securities otherwise permissible for investment under its investment guidelines through the sale of credit default swaps (“CDS”). Under the terms of these swaps, the Company receives quarterly fixed premiums that, together with any initial amount paid or received at trade inception, replicate the credit spread otherwise currently obtainable by purchasing the referenced entity’s bonds of similar maturity. These credit derivatives generally have remaining terms of five years or less and are recorded at fair value with changes in fair value, including the yield component that emerges from initial amounts paid or received, reported in Net derivative gains (losses). The Company manages its credit exposure taking into consideration both cash and derivatives based positions and selects the reference entities in its replicated credit exposures in a manner consistent with its selection of fixed maturities. In addition, the Company generally transacts the sale of CDS in single name reference entities of investment grade credit quality and with counterparties subject to collateral posting requirements. If there is an event of default by the reference entity or other such credit event as defined under the terms of the swap contract, the Company is obligated to perform under the credit derivative and, at the counterparty’s option, either pay the referenced amount of the contract less an auction-determined recovery amount or pay the referenced amount of the contract and receive in return the defaulted or similar security of the reference entity for recovery by sale at the contract settlement auction. The Company purchased CDS to mitigate its exposure to a reference entity through cash positions. These positions do not replicate credit spreads. To date, there have been no events of default or circumstances indicative of a deterioration in the credit quality of the named referenced entities to require or suggest that the Company will have to perform under these CDS. The maximum potential amount of future payments the Company could be required to make under these credit derivatives is limited to the par value of the referenced securities which is the dollar or euro-equivalent of the derivative’s notional amount. The Standard North American CDS Contract (“SNAC”) or Standard European Corporate Contract (“STEC”) under which the Company executes these CDS sales transactions does not contain recourse provisions for recovery of amounts paid under the credit derivative. The Company purchased 30-year TIPS and other sovereign bonds, both inflation-linked and non-inflation linked, as General Account investments and enters into asset or cross-currency basis swaps, to result in payment of the given bond’s coupons and principal at maturity in the bond’s specified currency to the swap counterparty in return for fixed dollar amounts. These swaps, when considered in combination with the bonds, together result in a net position that is intended to replicate a dollar-denominated fixed-coupon cash bond with a yield higher than a term-equivalent U.S. Treasury bond. The tables below present quantitative disclosures about the Company’s derivative instruments, including those embedded in other contracts required to be accounted for as derivative instruments: Derivative Instruments by Category At June 30, 2020 Six Months Ended June 30, 2020 Fair Value Notional Derivative Assets Derivative Liabilities Net Derivative Gains (Losses) (2) (in millions) Derivative instruments: Freestanding derivatives (1): Equity contracts: Futures $ 3,848 $ — $ — $ (126) Swaps 17,760 77 79 963 Options 36,469 4,333 2,442 (1,387) Interest rate contracts: Swaps 24,771 2,089 432 3,658 Futures 23,565 — — 2,072 Swaptions — — — 9 Credit contracts: Credit default swaps 1,252 10 4 (7) Other freestanding contracts: Foreign currency contracts 347 — — (3) Margin — 51 77 — Collateral — 14 3,288 — Embedded derivatives: GMIB reinsurance contracts (3) — 3,433 — 1,026 GMxB derivative features liability (4) — — 12,382 (3,946) SCS, SIO, MSO and IUL indexed features (5) — — 1,690 1,377 Total derivative instruments $ 108,012 $ 10,007 $ 20,394 Net derivative gains (losses) (6) $ 3,636 ______________ (1) Reported in Other invested assets in the consolidated balance sheets. (2) Reported in Net derivative gains (losses) in the consolidated statements of income (loss). (3) Reported in GMIB reinsurance contract asset in the consolidated balance sheets. (4) Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets. (5) Reported in Policyholders’ account balances in the consolidated balance sheets. (6) Investment fees of $6 million are reported in Net derivative gains (losses) in the consolidated statements of income (loss). Derivative Instruments by Category At December 31, 2019 Six Months Ended June 30, 2019 Fair Value Notional Amount Derivative Assets Derivative Liabilities Net Derivative Gains (Losses) (2) (in millions) Derivative instruments: Freestanding derivatives (1): Equity contracts: Futures $ 3,510 $ — $ — $ (930) Swaps 17,064 9 279 (1,260) Options 47,766 5,080 1,749 1,276 Interest rate contracts: Swaps 23,700 467 523 1,597 Futures 20,424 — — 25 Swaptions 3,201 16 — 7 Credit contracts: Credit default swaps 1,232 18 — 13 Other freestanding contracts: Foreign currency contracts 501 3 — (27) Margin — 140 — — Collateral — 72 3,001 — Embedded derivatives: GMIB reinsurance contracts (3) — 2,466 — 217 GMxB derivative features liability (4) — — 8,246 (1,116) SCS, SIO, MSO and IUL indexed features (5) — — 3,150 (1,535) Total derivative instruments $ 117,398 $ 8,271 $ 16,948 Net derivative gains (losses) $ (1,733) ______________ (1) Reported in Other invested assets in the consolidated balance sheets. (2) Reported in Net derivative gains (losses) in the consolidated statements of income (loss). (3) Reported in GMIB reinsurance contract asset in the consolidated balance sheets. (4) Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets. (5) Reported in Policyholders’ account balances in the consolidated balance sheets. Equity-Based and Treasury Futures Contracts Margin All outstanding equity-based and treasury futures contracts at June 30, 2020 and December 31, 2019 are exchange-traded and net settled daily in cash. At June 30, 2020 and December 31, 2019, respectively, the Company had open exchange-traded futures positions on: (i) the S&P 500, Russell 2000 and Emerging Market indices, having initial margin requirements of $264 million and $58 million, (ii) the 2-year, 5-year and 10-year U.S. Treasury Notes on U.S. Treasury bonds and ultra-long bonds, having initial margin requirements of $404 million and $165 million, and (iii) the Euro Stoxx, FTSE 100, Topix, ASX 200 and European, Australasia, and Far East (“EAFE”) indices as well as corresponding currency futures on the Euro/U.S. dollar, Pound/U.S. dollar, Australian dollar/U.S. dollar, and Yen/U.S. dollar, having initial margin requirements of $43 million and $60 million. Collateral Arrangements The Company generally has executed a Credit Support Annex (“CSA”) under the International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) it maintains with each of its over-the-counter (“OTC”) derivative counterparties that requires both posting and accepting collateral either in the form of cash or high-quality securities, such as U.S. Treasury securities, U.S. government and government agency securities and investment grade corporate bonds. The Company nets the fair value of all derivative financial instruments with counterparties for which an ISDA Master Agreement and related CSA have been executed. At June 30, 2020 and December 31, 2019, respectively, the Company held $3.3 billion and $3.0 billion in cash and securities collateral delivered by trade counterparties, representing the fair value of the related derivative agreements. The unrestricted cash collateral is reported in Other invested assets. The Company posted collateral of $14 million and $72 million at June 30, 2020 and December 31, 2019, respectively, in the normal operation of its collateral arrangements. The following table presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments at June 30, 2020: Offsetting of Financial Assets and Liabilities and Derivative Instruments At June 30, 2020 Gross Amount Recognized Gross Amount Offset in the Balance Sheets Net Amount Presented in the Balance Sheets Gross Amount not Offset in the Balance Sheets (1) Net Amount (in millions) Assets: Derivative assets $ 6,573 $ 6,134 $ 439 $ (118) $ 321 Other financial assets 1,523 — 1,523 — 1,523 Other invested assets $ 8,096 $ 6,134 $ 1,962 $ (118) $ 1,844 Liabilities: Derivative liabilities $ 6,203 $ 6,134 $ 69 $ — $ 69 Other financial liabilities 1,462 — 1,462 — 1,462 Other liabilities $ 7,665 $ 6,134 $ 1,531 $ — $ 1,531 ______________ (1) Financial instrument/s sent (held). The following table presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments at December 31, 2019. Offsetting of Financial Assets and Liabilities and Derivative Instruments At December 31, 2019 Gross Amount Recognized Gross Amount Offset in the Balance Sheets Net Amount Presented in the Balance Sheets Gross Amount not Offset in the Balance Sheets (1) Net Amount (in millions) Assets: Derivative assets $ 5,804 $ 5,429 $ 375 $ (77) $ 298 Other financial instruments 1,781 — 1,781 — 1,781 Other invested assets $ 7,585 $ 5,429 $ 2,156 $ (77) $ 2,079 Liabilities: Derivative liabilities $ 5,474 $ 5,429 $ 45 $ — $ 45 Other financial liabilities 1,723 — 1,723 — 1,723 Other liabilities $ 7,197 $ 5,429 $ 1,768 $ — $ 1,768 ______________ (1) Financial instruments sent (held). |
CLOSED BLOCK
CLOSED BLOCK | 6 Months Ended |
Jun. 30, 2020 | |
Closed Block Disclosure [Abstract] | |
CLOSED BLOCK | CLOSED BLOCK As a result of demutualization, the Company’s Closed Block was established in 1992 for the benefit of certain individual participating policies that were in force on that date. Assets, liabilities and earnings of the Closed Block are specifically identified to support its participating policyholders. Assets allocated to the Closed Block inure solely to the benefit of the Closed Block policyholders and will not revert to the benefit of the Company. No reallocation, transfer, borrowing or lending of assets can be made between the Closed Block and other portions of the Company’s General Account, any of its Separate Accounts or any affiliate of the Company without the approval of the New York State Department of Financial Services (the “NYDFS”). Closed Block assets and liabilities are carried on the same basis as similar assets and liabilities held in the General Account. For more information on the Closed Block, see Note 5 to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2019. June 30, 2020 December 31, 2019 (in millions) Closed Block Liabilities: Future policy benefits, policyholders’ account balances and other $ 6,327 $ 6,478 Policyholder dividend obligation 150 2 Other liabilities 100 38 Total Closed Block liabilities 6,577 6,518 Assets Designated to the Closed Block: Fixed maturities available-for-sale, at fair value (amortized cost of $3,490 and $3,558) (allowance for credit losses of $0 at June 30, 2020) 3,838 3,754 Mortgage loans on real estate (net of allowance for credit losses of $7 at June 30, 2020) 1,774 1,759 Policy loans 668 706 Cash and other invested assets 44 82 Other assets 183 145 Total assets designated to the Closed Block 6,507 6,446 Excess of Closed Block liabilities over assets designated to the Closed Block 70 72 Amounts included in accumulated other comprehensive income (loss): Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $150 and $2; and net of income tax: $42 and $41 167 164 Maximum future earnings to be recognized from Closed Block assets and liabilities $ 237 $ 236 The Company’s Closed Block revenues and expenses were as follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Revenues: Premiums and other income $ 40 $ 46 $ 82 $ 94 Net investment income (loss) 63 72 129 139 Investment gains (losses), net (2) — (2) (1) Total revenues 101 118 209 232 Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Benefits and Other Deductions: Policyholders’ benefits and dividends 103 114 206 235 Other operating costs and expenses 1 — 1 1 Total benefits and other deductions 104 114 207 236 Net income (loss), before income taxes (3) 4 2 (4) Income tax (expense) benefit (1) (1) (1) (2) Net income (loss) $ (4) $ 3 $ 1 $ (6) |
INSURANCE LIABILITIES
INSURANCE LIABILITIES | 6 Months Ended |
Jun. 30, 2020 | |
Insurance [Abstract] | |
INSURANCE LIABILITIES | INSURANCE LIABILITIES Variable Annuity Contracts – GMDB, GMIB, GIB and GWBL and Other Features The Company has certain variable annuity contracts with GMDB, GMIB, GIB and GWBL and other features in-force that guarantee one of the following: • Return of Premium: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals); • Ratchet: the benefit is the greatest of current account value, premiums paid (adjusted for withdrawals), or the highest account value on any anniversary up to contractually specified ages (adjusted for withdrawals); • Roll-Up: the benefit is the greater of current account value or premiums paid (adjusted for withdrawals) accumulated at contractually specified interest rates up to specified ages; • Combo: the benefit is the greater of the ratchet benefit or the roll-up benefit, which may include either a five year or an annual reset; or • Withdrawal: the withdrawal is guaranteed up to a maximum amount per year for life. Liabilities for Variable Annuity Contracts with GMDB and GMIB Features without No-Lapse Guarantee Rider (“NLG”) Feature The change in the liabilities for variable annuity contracts with GMDB and GMIB features and without a NLG feature are summarized in the tables below. The amounts for the direct contracts (before reinsurance ceded) and assumed contracts are reflected in the consolidated balance sheets in Future policy benefits and other policyholders’ liabilities. The amounts for the ceded contracts are reflected in the consolidated balance sheets in Amounts due from reinsurers. Change in Liability for Variable Annuity Contracts with GMDB and GMIB Features and No NLG Feature For the Three and Six Months Ended June 30, 2020 and 2019 GMDB GMIB Direct Ceded Direct Ceded (in millions) Balance at April 1, 2020 $ 5,047 $ (105) $ 6,297 $ (3,305) Paid guarantee benefits (140) 4 (103) 17 Other changes in reserve 102 3 (43) (145) Balance at June 30, 2020 $ 5,009 $ (98) $ 6,151 $ (3,433) Balance at April 1, 2019 $ 4,665 $ (103) $ 3,740 $ (2,009) Paid guarantee benefits (108) 5 (56) 14 Other changes in reserve 153 (2) 75 (201) Balance at June 30, 2019 $ 4,710 $ (100) $ 3,759 $ (2,196) GMDB GMIB Direct Ceded Direct Ceded (in millions) Balance at January 1, 2020 $ 4,779 $ (98) $ 4,688 $ (2,466) Paid guarantee benefits (251) 9 (177) 37 Other changes in reserve 481 (9) 1,640 (1,004) Balance at June 30, 2020 $ 5,009 $ (98) $ 6,151 $ (3,433) Balance at January 1, 2019 $ 4,654 $ (107) $ 3,741 $ (1,991) Paid guarantee benefits (226) 9 (112) 35 Other changes in reserve 282 (2) 130 (240) Balance at June 30, 2019 $ 4,710 $ (100) $ 3,759 $ (2,196) Liabilities for Embedded and Freestanding Insurance Related Derivatives The liability for the GMxB derivative features, the liability for SCS, SIO, MSO and IUL indexed features and the asset and liability for the GMIB reinsurance contracts are considered embedded or freestanding insurance derivatives and are reported at fair value. For the fair value of the assets and liabilities associated with these embedded or freestanding insurance derivatives, see Note 7. Account Values and Net Amount at Risk Account Values and Net Amount at Risk (“NAR”) for direct variable annuity contracts in force with GMDB and GMIB features as of June 30, 2020 are presented in the following tables by guarantee type. For contracts with the GMDB feature, the NAR in the event of death is the amount by which the GMDB feature exceeds the related Account Values. For contracts with the GMIB feature, the NAR in the event of annuitization is the amount by which the present value of the GMIB benefits exceed the related Account Values, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. Since variable annuity contracts with GMDB features may also offer GMIB guarantees in the same contract, the GMDB and GMIB amounts listed are not mutually exclusive. Direct Variable Annuity Contracts with GMDB and GMIB Features at June 30, 2020 Guarantee Type Return of Premium Ratchet Roll-Up Combo Total (in millions, except age and interest rate) Variable annuity contracts with GMDB features Account Values invested in: General Account $ 14,904 $ 90 $ 57 $ 174 $ 15,225 Separate Accounts 46,313 8,576 2,914 30,252 88,055 Total Account Values $ 61,217 $ 8,666 $ 2,971 $ 30,426 $ 103,280 Net Amount at Risk, gross $ 167 $ 207 $ 1,990 $ 20,398 $ 22,762 Net Amount at Risk, net of amounts reinsured $ 167 $ 201 $ 1,414 $ 20,398 $ 22,180 Average attained age of policyholders (in years) 51.2 68.0 74.6 69.8 55.1 Percentage of policyholders over age 70 10.9 % 47.1 % 69.3 % 52.4 % 19.8 % Range of contractually specified interest rates N/A N/A 3% - 6% 3% - 6.5% 3% - 6.5% Variable annuity contracts with GMIB features Account Values invested in: General Account $ — $ — $ 18 $ 223 $ 241 Separate Accounts — — 22,463 32,329 54,792 Total Account Values $ — $ — $ 22,481 $ 32,552 $ 55,033 Net Amount at Risk, gross $ — $ — $ 1,189 $ 15,384 $ 16,573 Net Amount at Risk, net of amounts reinsured $ — $ — $ 376 $ 13,872 $ 14,248 Average attained age of policyholders (in years) N/A N/A 63.8 69.8 67.6 Weighted average years remaining until annuitization N/A N/A 5.9 0.7 2.6 Range of contractually specified interest rates N/A N/A 3% - 6% 3% - 6.5% 3% - 6.5% For more information about the reinsurance programs of the Company’s GMDB and GMIB exposure, see “Reinsurance” in Note 10 to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2019. Separate Accounts Investments by Investment Category Underlying Variable Annuity Contracts with GMDB and GMIB Features The total Account Values of variable annuity contracts with GMDB and GMIB features include amounts allocated to the guaranteed interest option, which is part of the General Account and variable investment options that invest through Separate Accounts in variable insurance trusts. The following table presents the aggregate fair value of assets, by major investment category, held by Separate Accounts that support variable annuity contracts with GMDB and GMIB features. The investment performance of the assets impacts the related Account Values and, consequently, the NAR associated with the GMDB and GMIB benefits and guarantees. Because the Company’s variable annuity contracts offer both GMDB and GMIB features, GMDB and GMIB amounts are not mutually exclusive. Investment in Variable Insurance Trust Mutual Funds June 30, 2020 December 31, 2019 Mutual Fund Type GMDB GMIB GMDB GMIB (in millions) Equity $ 39,126 $ 16,011 $ 42,489 $ 17,941 Fixed income 5,297 2,682 5,263 2,699 Balanced 42,696 35,835 45,871 38,445 Other 936 264 865 263 Total $ 88,055 $ 54,792 $ 94,488 $ 59,348 Hedging Programs for GMDB, GMIB, GIB and Other Features The Company has a program intended to hedge certain risks associated first with the GMDB feature and with the GMIB feature of the Accumulator series of variable annuity products. The program has also been extended to cover other guaranteed benefits as they have been made available. This program utilizes derivative contracts, such as exchange-traded equity, currency and interest rate futures contracts, total return and/or equity swaps, interest rate swap and floor contracts, swaptions, variance swaps as well as equity options, that collectively are managed in an effort to reduce the economic impact of unfavorable changes in guaranteed benefits’ exposures attributable to movements in the capital markets. At the present time, this program hedges certain economic risks on products sold from 2001 forward, to the extent such risks are not externally reinsured. These programs do not qualify for hedge accounting treatment. Therefore, gains (losses) on the derivatives contracts used in these programs, including current period changes in fair value, are recognized in Net derivative gains (losses) in the period in which they occur, and may contribute to income (loss) volatility. Variable and Interest-Sensitive Life Insurance Policies - NLG The NLG feature contained in variable and interest-sensitive life insurance policies keeps them in force in situations where the policy value is not sufficient to cover monthly charges then due. The NLG remains in effect so long as the policy meets a contractually specified premium funding test and certain other requirements. The change in the NLG liabilities, reflected in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets, is summarized in the table below. 2020 2019 Direct Liability Reinsurance Ceded Net Direct Liability Reinsurance Ceded Net (in millions) Balance at April 1, $ 920 $ (827) $ 93 $ 801 $ (744) $ 57 Paid guarantee benefits (13) — (13) (3) — (3) Other changes in reserves 35 (14) 21 21 (11) 10 Balance at June 30, $ 942 $ (841) $ 101 $ 819 $ (755) $ 64 Balance at January 1, $ 893 $ (807) $ 86 $ 787 $ (733) $ 54 Paid guarantee benefits (26) — (26) (10) — (10) Other changes in reserves 75 (34) 41 42 (22) 20 Balance at June 30, $ 942 $ (841) $ 101 $ 819 $ (755) $ 64 |
FAIR VALUE DISCLOSURES
FAIR VALUE DISCLOSURES | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE DISCLOSURES | FAIR VALUE DISCLOSURES U.S. GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value, and identifies three levels of inputs that may be used to measure fair value: Level 1 Unadjusted quoted prices for identical instruments in active markets. Level 1 fair values generally are supported by market transactions that occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, and inputs to model-derived valuations that are directly observable or can be corroborated by observable market data. Level 3 Unobservable inputs supported by little or no market activity and often requiring significant management judgment or estimation, such as an entity’s own assumptions about the cash flows or other significant components of value that market participants would use in pricing the asset or liability. The Company uses unadjusted quoted market prices to measure fair value for those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are measured using present value or other valuation techniques. The fair value determinations are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of the timing and amount of expected future cash flows and the credit standing of counterparties. Such adjustments do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they consider the tax impact of the realization of unrealized gains or losses. In many cases, the fair value cannot be substantiated by direct comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument. Management is responsible for the determination of the value of investments carried at fair value and the supporting methodologies and assumptions. Under the terms of various service agreements, the Company often utilizes independent valuation service providers to gather, analyze, and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual securities. These independent valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested. As further described below with respect to specific asset classes, these inputs include, but are not limited to, market prices for recent trades and transactions in comparable securities, benchmark yields, interest rate yield curves, credit spreads, quoted prices for similar securities, and other market-observable information, as applicable. Specific attributes of the security being valued also are considered, including its term, interest rate, credit rating, industry sector, and when applicable, collateral quality and other security- or issuer-specific information. When insufficient market observable information is available upon which to measure fair value, the Company either will request brokers knowledgeable about these securities to provide a non-binding quote or will employ internal valuation models. Fair values received from independent valuation service providers and brokers and those internally modeled or otherwise estimated are assessed for reasonableness. Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities measured at fair value on a recurring basis are summarized below. At June 30, 2020 and December 31, 2019, no assets were required to be measured at fair value on a non-recurring basis. Fair value measurements are required on a non-recurring basis for certain assets, including goodwill and mortgage loans on real estate, only when an impairment or other event occurs. When such fair value measurements are recorded, they must be classified and disclosed within the fair value hierarchy. Fair Value Measurements at June 30, 2020 Level 1 Level 2 Level 3 Total (in millions) Assets: Investments: Fixed maturities, AFS: Corporate (1) $ — $ 47,978 $ 1,652 $ 49,630 U.S. Treasury, government and agency — 17,193 — 17,193 States and political subdivisions — 672 40 712 Foreign governments — 833 — 833 Residential mortgage-backed (2) — 158 — 158 Asset-backed (3) — 2,039 — 2,039 Commercial mortgage-backed — 879 — 879 Redeemable preferred stock 315 63 — 378 Total fixed maturities, AFS 315 69,815 1,692 71,822 Other equity investments 12 — 1 13 Trading securities 282 5,859 — 6,141 Other invested assets: Short-term investments — 227 — 227 Assets of consolidated VIEs/VOEs — — 15 15 Swaps — 1,655 — 1,655 Credit default swaps — 6 — 6 Options — 1,891 — 1,891 Total other invested assets — 3,779 15 3,794 Cash equivalents 3,784 — — 3,784 GMIB reinsurance contracts asset — — 3,433 3,433 Separate Accounts assets (4) 113,420 2,792 — 116,212 Total Assets $ 117,813 $ 82,245 $ 5,141 $ 205,199 Liabilities: GMxB derivative features’ liability $ — $ — $ 12,382 $ 12,382 SCS, SIO, MSO and IUL indexed features’ liability — 1,690 — 1,690 Total Liabilities $ — $ 1,690 $ 12,382 $ 14,072 ______________ (1) Corporate fixed maturities includes both public and private issues. (2) Includes publicly traded agency pass-through securities and collateralized obligations. (3) Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans. (4) Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. At June 30, 2020 the fair value of such investments was $363 million. Fair Value Measurements at December 31, 2019 Level 1 Level 2 Level 3 Total (in millions) Assets: Investments: Fixed maturities, AFS: Corporate (1) $ — $ 43,218 $ 1,246 $ 44,464 U.S. Treasury, government and agency — 15,231 — 15,231 States and political subdivisions — 610 39 649 Foreign governments — 490 — 490 Residential mortgage-backed (2) — 173 — 173 Asset-backed (3) — 744 100 844 Redeemable preferred stock 237 274 — 511 Total fixed maturities, AFS 237 60,740 1,385 62,362 Other equity investments 13 — — 13 Trading securities 321 6,277 — 6,598 Other invested assets: Short-term investments — 468 — 468 Assets of consolidated VIEs/VOEs — — 16 16 Swaps — (326) — (326) Credit default swaps — 18 — 18 Options — 3,331 — 3,331 Total other invested assets — 3,491 16 3,507 Cash equivalents 1,155 — — 1,155 GMIB reinsurance contracts asset — — 2,466 2,466 Separate Accounts assets (4) 121,184 2,878 — 124,062 Total Assets $ 122,910 $ 73,386 $ 3,867 $ 200,163 Liabilities: GMxB derivative features’ liability $ — $ — $ 8,246 $ 8,246 SCS, SIO, MSO and IUL indexed features’ liability — 3,150 — 3,150 Total Liabilities $ — $ 3,150 $ 8,246 $ 11,396 ______________ (1) Corporate fixed maturities includes both public and private issues. (2) Includes publicly traded agency pass-through securities and collateralized obligations. (3) Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans. (4) Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. At December 31, 2019 the fair value of such investments was $356 million. Public Fixed Maturities The fair values of the Company’s public fixed maturities are generally based on prices obtained from independent valuation service providers and for which the Company maintains a vendor hierarchy by asset type based on historical pricing experience and vendor expertise. Although each security generally is priced by multiple independent valuation service providers, the Company ultimately uses the price received from the independent valuation service provider highest in the vendor hierarchy based on the respective asset type, with limited exception. To validate reasonableness, prices also are internally reviewed by those with relevant expertise through comparison with directly observed recent market trades. Consistent with the fair value hierarchy, public fixed maturities validated in this manner generally are reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs. Private Fixed Maturities The fair values of the Company’s private fixed maturities are determined from prices obtained from independent valuation service providers. Prices not obtained from an independent valuation service provider are determined by using a discounted cash flow model or a market comparable company valuation technique. In certain cases, these models use observable inputs with a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions, taking into account, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Generally, these securities have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model or a market comparable company valuation technique may also incorporate unobservable inputs, which reflect the Company’s own assumptions about the inputs market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the fair value measurement of a security, a Level 3 classification generally is made. Freestanding Derivative Positions The net fair value of the Company’s freestanding derivative positions as disclosed in Note 4 are generally based on prices obtained either from independent valuation service providers or derived by applying market inputs from recognized vendors into industry standard pricing models. The majority of these derivative contracts are traded in the OTC derivative market and are classified in Level 2. The fair values of derivative assets and liabilities traded in the OTC market are determined using quantitative models that require use of the contractual terms of the derivative instruments and multiple market inputs, including interest rates, prices, and indices to generate continuous yield or pricing curves, including overnight index swap (“OIS”) curves, and volatility factors, which then are applied to value the positions. The predominance of market inputs is actively quoted and can be validated through external sources or reliably interpolated if less observable. Level Classifications of the Company’s Financial Instruments Financial Instruments Classified as Level 1 Investments classified as Level 1 primarily include redeemable preferred stock, trading securities, cash equivalents and Separate Accounts assets. Fair value measurements classified as Level 1 include exchange-traded prices of fixed maturities, equity securities and derivative contracts, and net asset values for transacting subscriptions and redemptions of mutual fund shares held by Separate Accounts. Cash equivalents classified as Level 1 include money market accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less and are carried at cost as a proxy for fair value measurement due to their short-term nature. Financial Instruments Classified as Level 2 Investments classified as Level 2 are measured at fair value on a recurring basis and primarily include U.S. government and agency securities and certain corporate debt securities, such as public and private fixed maturities. As market quotes generally are not readily available or accessible for these securities, their fair value measures are determined utilizing relevant information generated by market transactions involving comparable securities and often are based on model pricing techniques that effectively discount prospective cash flows to present value using appropriate sector-adjusted credit spreads commensurate with the security’s duration, also taking into consideration issuer-specific credit quality and liquidity. Observable inputs generally used to measure the fair value of securities classified as Level 2 include benchmark yields, reported secondary trades, issuer spreads, benchmark securities and other reference data. Additional observable inputs are used when available, and as may be appropriate, for certain security types, such as prepayment, default, and collateral information for the purpose of measuring the fair value of mortgage- and asset-backed securities. The Company’s AAA-rated mortgage- and asset-backed securities are classified as Level 2 for which the observability of market inputs to their pricing models is supported by sufficient, albeit more recently contracted, market activity in these sectors. Certain Company products, such as the SCS and EQUI-VEST variable annuity products, IUL and the MSO fund available in some life contracts offer investment options which permit the contract owner to participate in the performance of an index, ETF or commodity price. These investment options, which depending on the product and on the index selected can currently have one, three, five or six year terms, provide for participation in the performance of specified indices, ETF or commodity price movement up to a segment-specific declared maximum rate. Under certain conditions that vary by product, e.g., holding these segments for the full term, these segments also shield policyholders from some or all negative investment performance associated with these indices, ETF or commodity prices. These investment options have defined formulaic liability amounts, and the current values of the option component of these segment reserves are accounted for as Level 2 embedded derivatives. The fair values of these embedded derivatives are based on data obtained from independent valuation service providers. Financial Instruments Classified as Level 3 The Company’s investments classified as Level 3 primarily include corporate debt securities, such as private fixed maturities and asset-backed securities. Determinations to classify fair value measures within Level 3 of the valuation hierarchy generally are based upon the significance of the unobservable factors to the overall fair value measurement. Included in the Level 3 classification are fixed maturities with indicative pricing obtained from brokers that otherwise could not be corroborated to market observable data. The Company also issues certain benefits on its variable annuity products that are accounted for as derivatives and are also considered Level 3. The GMIBNLG feature allows the policyholder to receive guaranteed minimum lifetime annuity payments based on predetermined annuity purchase rates applied to the contract’s benefit base if and when the contract account value is depleted and the NLG feature is activated. The GMWB feature allows the policyholder to withdraw at minimum, over the life of the contract, an amount based on the contract’s benefit base. The GWBL feature allows the policyholder to withdraw, each year for the life of the contract, a specified annual percentage of an amount based on the contract’s benefit base. The GMAB feature increases the contract account value at the end of a specified period to a GMAB base. The GIB feature provides a lifetime annuity based on predetermined annuity purchase rates if and when the contract account value is depleted. This lifetime annuity is based on predetermined annuity purchase rates applied to a GIB base. Level 3 also includes the GMIB reinsurance contract assets which are accounted for as derivative contracts. The GMIB reinsurance contract asset and liabilities’ fair value reflects the present value of reinsurance premiums and recoveries and risk margins over a range of market consistent economic scenarios while GMxB derivative features liability reflects the present value of expected future payments (benefits) less fees, adjusted for risk margins and nonperformance risk, attributable to GMxB derivative features’ liability over a range of market-consistent economic scenarios. The valuations of the GMIB reinsurance contract asset and GMxB derivative features liability incorporate significant non-observable assumptions related to policyholder behavior, risk margins and projections of equity Separate Accounts funds. The credit risks of the counterparty and of the Company are considered in determining the fair values of its GMIB reinsurance contract asset and GMxB derivative features liability positions, respectively, after taking into account the effects of collateral arrangements. Incremental adjustment to the swap curve for non-performance risk is made to the fair values of the GMIB reinsurance contract asset and liabilities and GMIBNLG feature to reflect the claims-paying ratings of counterparties and the Company. Equity and fixed income volatilities were modeled to reflect current market volatilities. Due to the unique, long duration of the GMIBNLG feature, adjustments were made to the equity volatilities to remove the illiquidity bias associated with the longer tenors and risk margins were applied to the non-capital markets inputs to the GMIBNLG valuations. After giving consideration to collateral arrangements, the Company reduced the fair value of its GMIB reinsurance contract asset by $302 million and $175 million at June 30, 2020 and December 31, 2019, respectively, to recognize incremental counterparty non-performance risk. Lapse rates are adjusted at the contract level based on a comparison of the actuarial calculated guaranteed values and the current policyholder account value, which include other factors such as considering surrender charges. Generally, lapse rates are assumed to be lower in periods when a surrender charge applies. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in the money contracts are less likely to lapse. For valuing the embedded derivative, lapse rates vary throughout the period over which cash flows are projected. The Company’s consolidated VIEs/VOEs hold investments that are classified as Level 3, primarily corporate bonds that are vendor priced with no ratings available, bank loans, non-agency collateralized mortgage obligations and asset-backed securities. Transfers of Financial Instruments Between Levels 2 and 3 During the six months ended June 30, 2020, AFS fixed maturities with fair values of $103 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, AFS fixed maturities with fair value of $219 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately 2.1% of total equity at June 30, 2020. During the six months ended June 30, 2019, AFS fixed maturities with fair values of $73 million were transferred out of Level 3 and into Level 2 principally due to the availability of trading activity and/or market observable inputs to measure and validate their fair values. In addition, AFS fixed maturities with fair value of $14 million were transferred from Level 2 into the Level 3 classification. These transfers in the aggregate represent approximately 0.6% of total equity at June 30, 2019. The tables below present reconciliations for all Level 3 assets and liabilities for the three and six months ended June 30, 2020 and 2019, respectively. Level 3 Instruments - Fair Value Measurements Corporate State and Political Subdivisions Asset-backed (in millions) Balance, April 1, 2020 $ 1,174 $ 36 $ 40 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 1 — — Investment gains (losses), net (11) — — Subtotal (10) — — Other comprehensive income (loss) 6 5 8 Purchases 284 — (48) Sales (44) (1) — Transfers into Level 3 (1) 219 — — Transfers out of Level 3 (1) 23 — — Balance, June 30, 2020 $ 1,652 $ 40 $ — Balance, April 1, 2019 $ 1,169 $ 39 $ 534 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 2 — — Investment gains (losses), net — — — Subtotal 2 — — Other comprehensive income (loss) 1 1 1 Purchases 151 — (1) Sales (26) (1) — Transfers into Level 3 (1) (3) — — Transfers out of Level 3 (1) (4) — — Balance, June 30, 2019 $ 1,290 $ 39 $ 534 ______________ (1) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. Corporate State and Political Subdivisions Asset-backed (in millions) Balance, January 1, 2020 $ 1,246 $ 39 $ 100 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 2 — — Investment gains (losses), net (13) — — Subtotal (11) — — Corporate State and Political Subdivisions Asset-backed (in millions) Other comprehensive income (loss) (54) 2 — Purchases 345 — — Sales (90) (1) — Transfers into Level 3 (1) 219 — — Transfers out of Level 3 (1) (3) — (100) Balance, June 30, 2020 $ 1,652 $ 40 $ — Balance, January 1, 2019 $ 1,174 $ 38 $ 519 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 3 — — Investment gains (losses), net — — — Subtotal 3 — — Other comprehensive income (loss) 10 2 5 Purchases 221 — 10 Sales (59) (1) — Transfers into Level 3 (1) 14 — — Transfers out of Level 3 (1) (73) — — Balance, June 30, 2019 $ 1,290 $ 39 $ 534 ______________ (1) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. Other Equity Investments GMIB Reinsurance Contract Asset Separate Accounts Assets GMxB Derivative Features Liability (in millions) Balance, April 1, 2020 $ 15 $ 3,305 $ — $ (9,509) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — (139) — (370) Non-performance risk (1) — 272 — (2,411) Total realized and unrealized gains (losses) — 133 — (2,781) Other comprehensive income (loss) — — — — Purchases (2) 1 12 — (107) Sales (3) — (17) — 15 Settlements — — — — Change in estimate (4) — — — — Activity related to consolidated VIEs/VOEs — — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) — — — — Balance, June 30, 2020 $ 16 $ 3,433 $ — $ (12,382) Balance, April 1, 2019 $ 18 $ 2,009 $ 23 $ (5,944) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — 178 — (707) Non-performance risk (1) — 12 — — Total realized and unrealized gains (losses) — 190 — (707) Other comprehensive income (loss) — — — — Purchases (2) — 11 3 (103) Sales (3) — (14) — 5 Settlements — — (2) — Activity related to consolidated VIEs/VOEs (2) — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) — — — — Balance, June 30, 2019 $ 16 $ 2,196 $ 24 $ (6,749) ______________ (1) The Company’s non-performance risk is recorded through Net derivative gains (losses). (2) For the GMIB reinsurance contract asset and GMxB derivative features liability, represents attributed fee. (3) For the GMIB reinsurance contract asset, represents recoveries from reinsurers and for GMxB derivative features liability, represents benefits paid. (4) For the GMIB reinsurance contract asset, represents a transfer from amounts due from reinsurers. (5) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. Other Equity Investments GMIB Reinsurance Contract Asset Separate Accounts Assets GMxB Derivative Features Liability (in millions) Balance, January 1, 2020 $ 16 $ 2,466 $ — $ (8,246) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — 1,082 — (4,440) Non-performance risk (1) — (56) — 494 Total realized and unrealized gains (losses) — 1,026 — (3,946) Other comprehensive income (loss) — Purchases (2) 1 23 — (215) Sales (3) — (37) — 25 Settlements — — — — Change in estimate (4) — (45) — — Activity related to consolidated VIEs/VOEs (1) — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) — — — — Balance, June 30, 2020 $ 16 $ 3,433 $ — $ (12,382) Balance, January 1, 2019 $ 48 $ 1,991 $ 21 $ (5,431) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — 165 — (656) Non-performance risk (1) — 52 — (460) Total realized and unrealized gains (losses) — 217 — (1,116) Other comprehensive income (loss) — — — — Purchases (2) — 23 8 (210) Sales (3) — (35) — 8 Settlements — — (3) — Activity related to consolidated VIEs/VOEs (3) — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) (29) — (1) — Balance, June 30, 2019 $ 16 $ 2,196 $ 25 $ (6,749) ______________ (1) The Company’s non-performance risk is recorded through Net derivative gains (losses). (2) For the GMIB reinsurance contract asset and GMxB derivative features liability, represents attributed fee. (3) For the GMIB reinsurance contract asset, represents recoveries from reinsurers and for GMxB derivative features liability, represents benefits paid. (4) For the GMIB reinsurance contract asset, represents a transfer from amounts due from reinsurers. (5) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. The table below details changes in unrealized gains (losses) for the six months ended June 30, 2020 and 2019 by category for Level 3 assets and liabilities still held at June 30, 2020 and 2019, respectively. Change in Unrealized Gains (Losses) for Level 3 Instruments Net Income (Loss) Net Derivative Gains (Losses) OCI (in millions) Held at June 30, 2020: Change in unrealized gains (losses): Fixed maturities, AFS: Corporate $ — $ (54) State and political subdivisions — 2 Total fixed maturities, AFS — (52) GMIB reinsurance contracts 1,026 — GMxB derivative features liability (3,946) — Total $ (2,920) $ (52) Held at June 30, 2019: Change in unrealized gains (losses): Fixed maturities, AFS: Corporate $ — $ 10 State and political subdivisions — 2 Asset-backed — 5 Total fixed maturities, AFS — 17 GMIB reinsurance contracts 217 — GMxB derivative features liability (1,116) — Total $ (899) $ 17 Quantitative and Qualitative Information about Level 3 Fair Value Measurements The following tables disclose quantitative information about Level 3 fair value measurements by category for assets and liabilities at June 30, 2020 and December 31, 2019, respectively. Quantitative Information about Level 3 Fair Value Measurements at June 30, 2020 Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average (2) (in millions) Assets: Investments: Fixed maturities, AFS: Corporate $ 237 Matrix pricing Spread over Benchmark 0 - 580 bps 34 bps 1,062 Market EBITDA multiples 3.7x - 33.6x 14.0x GMIB reinsurance contract asset 3,433 Discounted cash flow Non-performance risk 55 - 144 bps 73 bps Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average (2) (in millions) Liabilities: GMIBNLG 12,081 Discounted cash flow Non-performance risk 166.0 bps GWBL/GMWB 167 Discounted cash flow Non-performance risk 166.0 bps GIB 124 Discounted cash flow Non-performance risk 166.0 bps GMAB 10 Discounted cash flow Non-performance risk 166.0 bps ______________ (1) Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives. (2) For Lapses, Withdrawals, and Utilizations the rates were weighted by counts, for Mortality weighted average rates are shown for all ages combined and for Withdrawals the weighted averages were based on an estimated split of partial withdrawal and dollar-for-dollar withdrawals. Quantitative Information about Level 3 Fair Value Measurements at December 31, 2019 Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average (in millions) Assets: Investments: Fixed maturities, AFS: Corporate $ 51 Matrix pricing model Spread over benchmark 65 - 580 bps 186 bps 1,025 Market comparable companies EBITDA multiples 3.3x - 56.7x 14.3x GMIB reinsurance contract asset 2,466 Discounted cash flow Non-performance risk 55 - 109 bps Liabilities: GMIBNLG 8,128 Discounted cash flow Non-performance risk 124 bps GWBL/GMWB 109 Discounted cash flow Non-performance risk 124 bps GIB 5 Discounted cash flow Non-performance risk 124 bps GMAB 4 Discounted cash flow Lapse rates 1.0% - 10.0% ______________ (1) Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives. Level 3 Financial Instruments for which Quantitative Inputs are Not Available Certain Privately Placed Debt Securities with Limited Trading Activity Excluded from the tables above at June 30, 2020 and December 31, 2019, respectively, are approximately $409 million and $325 million of Level 3 fair value measurements of investments for which the underlying quantitative inputs are not developed by the Company and are not readily available. These investments primarily consist of certain privately placed debt securities with limited trading activity, including residential mortgage- and asset-backed instruments, and their fair values generally reflect unadjusted prices obtained from independent valuation service providers and indicative, non-binding quotes obtained from third-party broker-dealers recognized as market participants. Significant increases or decreases in the fair value amounts received from these pricing sources may result in the Company’s reporting significantly higher or lower fair value measurements for these Level 3 investments. • The fair value of private placement securities is determined by application of a matrix pricing model or a market comparable company value technique. The significant unobservable input to the matrix pricing model valuation technique is the spread over the industry-specific benchmark yield curve. Generally, an increase or decrease in spreads would lead to directionally inverse movement in the fair value measurements of these securities. The significant unobservable input to the market comparable company valuation technique is the discount rate. Generally, a significant increase (decrease) in the discount rate would result in significantly lower (higher) fair value measurements of these securities. • Residential mortgage-backed securities classified as Level 3 primarily consist of non-agency paper with low trading activity. Included in the tables above at June 30, 2020 and December 31, 2019, there were no Level 3 securities that were determined by application of a matrix pricing model and for which the spread over the U.S. Treasury curve is the most significant unobservable input to the pricing result. Generally, a change in spreads would lead to directionally inverse movement in the fair value measurements of these securities. • Asset-backed securities classified as Level 3 primarily consist of non-agency mortgage loan trust certificates, including subprime and Alt-A paper, credit tenant loans, and equipment financings. Included in the tables above at June 30, 2020 and December 31, 2019, there were no secu |
LOANS TO AFFILIATES
LOANS TO AFFILIATES | 6 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions [Abstract] | |
LOANS TO AFFILIATES | LOANS TO AFFILIATES Loans Issued to Holdings In April 2018, Equitable Financial made a $800 million loan to Holdings. The loan has an interest rate of 3.69% and matures in April 2021. In December 2018 and in December 2019, Holdings repaid $200 million and $300 million in principal, respectively. At June 30, 2020, the amount outstanding was $300 million. In November 2019, Equitable Financial made a $900 million loan to Holdings. The loan has an interest rate of one-month LIBOR plus 1.33%. The loan matures on November 24, 2024. At June 30, 2020, the amount outstanding was $900 million. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income tax expense for the three and six months ended June 30, 2020 and 2019 was computed using an estimated annual effective tax rate (“ETR”), with discrete items recognized in the period in which they occur. The estimated ETR is revised, as necessary, at the end of successive interim reporting periods. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The Company did not enter into any new significant transactions with related parties during the six months ended June 30, 2020. |
EQUITY
EQUITY | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
EQUITY | EQUITY AOCI represents cumulative gains (losses) on items that are not reflected in Net income (loss). The balances as of June 30, 2020 and 2019 follow: June 30, 2020 2019 (in millions) Unrealized gains (losses) on investments $ 4,680 $ 1,571 Defined benefit pension plans (4) (7) Accumulated other comprehensive income (loss) attributable to Equitable Financial $ 4,676 $ 1,564 The components of OCI, net of taxes for the three and six months ended June 30, 2020 and 2019, follow: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Change in net unrealized gains (losses) on investments: Net unrealized gains (losses) arising during the period $ 2,633 $ 1,283 $ 4,229 $ 2,526 (Gains) losses reclassified into net income (loss) during the period (1) (134) (4) (182) 2 Net unrealized gains (losses) on investments 2,499 1,279 4,047 2,528 Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other (930) 12 (964) (473) Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $417, $341, $820 and $541) 1,569 1,291 3,083 2,055 Other comprehensive income (loss), attributable to Equitable Financial $ 1,570 $ 1,291 $ 3,084 $ 2,055 ____________ (1) See “Reclassification adjustments” in Note 3. Reclassification amounts presented net of income tax expense (benefit) of $(35) million, $0 million, $(48) million and $1 million for the three and six months ended June 30, 2020 and 2019, respectively. Investment gains and losses reclassified from AOCI to Net income (loss) primarily consist of realized gains (losses) on sales and credit losses of AFS securities and are included in Total investment gains (losses), net on the consolidated statements of income (loss). Amounts reclassified from AOCI to Net income (loss) as related to defined benefit plans primarily consist of amortization of net (gains) losses and net prior service cost (credit) recognized as a component of net periodic cost and reported in Compensation and benefits in the consolidated statements of income (loss). Amounts presented in the table above are net of tax. |
REDEEMABLE NONCONTROLLING INTER
REDEEMABLE NONCONTROLLING INTEREST | 6 Months Ended |
Jun. 30, 2020 | |
Noncontrolling Interest [Abstract] | |
REDEEMABLE NONCONTROLLING INTEREST | REDEEMABLE NONCONTROLLING INTEREST The changes in the components of redeemable noncontrolling interests are presented in the table that follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Balance, beginning of period $ 32 $ 48 $ 39 $ 39 Net earnings (loss) attributable to redeemable noncontrolling interests 2 1 (3) 3 Purchase/change of redeemable noncontrolling interests 2 (7) — — Balance, end of period $ 36 $ 42 $ 36 $ 42 |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | COMMITMENTS AND CONTINGENT LIABILITIES Litigation Litigation, regulatory and other loss contingencies arise in the ordinary course of the Company’s activities as a diversified financial services firm. The Company is a defendant in a number of litigation matters arising from the conduct of its business. In some of these matters, claimants seek to recover very large or indeterminate amounts, including compensatory, punitive, treble and exemplary damages. Modern pleading practice permits considerable variation in the assertion of monetary damages and other relief. Claimants are not always required to specify the monetary damages they seek, or they may be required only to state an amount sufficient to meet a court’s jurisdictional requirements. Moreover, some jurisdictions allow claimants to allege monetary damages that far exceed any reasonably possible verdict. The variability in pleading requirements and past experience demonstrates that the monetary and other relief that may be requested in a lawsuit or claim often bears little relevance to the merits or potential value of a claim. Litigation against the Company includes a variety of claims including, among other things, insurers’ sales practices, alleged agent misconduct, alleged failure to properly supervise agents, contract administration, product design, features and accompanying disclosure, cost of insurance increases, payments of death benefits and the reporting and escheatment of unclaimed property, alleged breach of fiduciary duties, alleged mismanagement of client funds and other matters. As with other financial services companies, the Company periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company or the financial services industry. It is the practice of the Company to cooperate fully in these matters. The outcome of a litigation or regulatory matter is difficult to predict, and the amount or range of potential losses associated with these or other loss contingencies requires significant management judgment. It is not possible to predict the ultimate outcome or to provide reasonably possible losses or ranges of losses for all pending regulatory matters, litigation and other loss contingencies. While it is possible that an adverse outcome in certain cases could have a material adverse effect upon the Company’s financial position, based on information currently known, management believes that neither the outcome of pending litigation and regulatory matters, nor potential liabilities associated with other loss contingencies, are likely to have such an effect. However, given the large and indeterminate amounts sought in certain litigation and the inherent unpredictability of all such matters, it is possible that an adverse outcome in certain of the Company’s litigation or regulatory matters, or liabilities arising from other loss contingencies, could, from time to time, have a material adverse effect upon the Company’s results of operations or cash flows in a particular quarterly or annual period. For some matters, the Company is able to estimate a possible range of loss. For such matters in which a loss is probable, an accrual has been made. For matters where the Company believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual has been made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the unaccrued amounts of the reasonably possible range of losses. As of June 30, 2020, the Company estimates the aggregate range of reasonably possible losses, in excess of any amounts accrued for these matters as of such date, to be up to approximately $100 million. For other matters, the Company is currently not able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company’s accruals, disclosures and reasonably possible losses or ranges of loss based on such reviews. In August 2015, a lawsuit was filed in Connecticut Superior Court, Judicial Division of New Haven entitled Richard T. O’Donnell, on behalf of himself and all others similarly situated v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action on behalf of all persons who purchased variable annuities from Equitable Financial, which were subsequently subjected to the volatility management strategy and who suffered injury as a result thereof. Plaintiff asserts a claim for breach of contract alleging that Equitable Financial implemented the volatility management strategy in violation of applicable law. Plaintiff seeks an award of damages individually and on a classwide basis, and costs and disbursements, including attorneys’ fees, expert witness fees and other costs. In November 2015, the Connecticut Federal District Court transferred this action to the United States District Court for the Southern District of New York. In March 2017, the Southern District of New York granted Equitable Financial’s motion to dismiss the complaint. In April 2017, the plaintiff filed a notice of appeal. In April 2018, the United States Court of Appeals for the Second Circuit reversed the trial court’s decision with instructions to remand the case to Connecticut state court. In September 2018, the Second Circuit issued its mandate, following Equitable Financial’s notification to the court that it would not file a petition for writ of certiorari. The case was transferred in December 2018 to the Connecticut Superior Court, Judicial District of Stamford. In December 2018, Equitable Financial sought dismissal of the complaint by filing a motion to strike, which the court granted in August 2019. Plaintiff filed an Amended Class Action Complaint in September 2019. Equitable Financial filed a motion for entry of judgment in October 2019. On August 3, 2020, the court granted Equitable Financial’s motion for entry of judgment. We are vigorously defending this matter. In February 2016, a lawsuit was filed in the United States District Court for the Southern District of New York entitled Brach Family Foundation, Inc. v. AXA Equitable Life Insurance Company. This lawsuit is a putative class action brought on behalf of all owners of universal life (“UL”) policies subject to Equitable Financial’s COI rate increase. In early 2016, Equitable Financial raised COI rates for certain UL policies issued between 2004 and 2007, which had both issue ages 70 and above and a current face value amount of $1 million and above. A second putative class action was filed in Arizona in 2017 and consolidated with the Brach matter. The current consolidated amended class action complaint alleges the following claims: breach of contract; misrepresentations by Equitable Financial in violation of Section 4226 of the New York Insurance Law; violations of New York General Business Law Section 349; and violations of the California Unfair Competition Law, and the California Elder Abuse Statute. Plaintiffs seek; (a) compensatory damages, costs, and, pre- and post-judgment interest; (b) with respect to their claim concerning Section 4226, a penalty in the amount of premiums paid by the plaintiffs and the putative class; and (c) injunctive relief and attorneys’ fees in connection with their statutory claims. Five other federal actions challenging the COI rate increase are also pending against Equitable Financial and have been coordinated with the Brach action for the purposes of pre-trial activities. They contain allegations similar to those in the Brach action as well as additional allegations for violations of various states’ consumer protection statutes and common law fraud. Three actions are also pending against Equitable Financial in New York state court. Equitable Financial is vigorously defending each of these matters. Obligations under Funding Agreements Federal Home Loan Bank of New York As a member of the FHLBNY, Equitable Financial has access to collateralized borrowings. It also may issue funding agreements to the FHLBNY. Both the collateralized borrowings and funding agreements would require Equitable Financial to pledge qualified mortgage-backed assets and/or government securities as collateral. Equitable Financial issues short-term funding agreements to the FHLBNY and uses the funds for asset, liability, and cash management purposes. Equitable Financial issues long-term funding agreements to the FHLBNY and uses the funds for spread lending purposes. Entering into FHLBNY membership, borrowings and funding agreements requires the ownership of FHLBNY stock and the pledge of assets as collateral. Equitable Financial has purchased FHLBNY stock of $313 million and pledged collateral with a carrying value of $8.6 billion as of June 30, 2020. Funding agreements are reported in Policyholders’ account balances in the consolidated balance sheets. For other instruments used for asset/liability and cash management purposes, see “Derivative and offsetting assets and liabilities” included in Note 4. The table below summarizes the Company’s activity of funding agreements with the FHLBNY. Change in FHLBNY Funding Agreements during the Six Months Ended June 30, 2020 Outstanding Balance at December 31, 2019 Issued During the Period Repaid During the Period Long-term Agreements Maturing Within One Year Long-term Agreements Maturing Within Five Year Outstanding Balance at June 30, 2020 (in millions) Short-term funding agreements: Due in one year or less $ 4,608 $ 22,950 $ 23,158 $ 490 $ — $ 4,890 Long-term funding agreements: Due in years two through five 1,646 — — (490) 112 1,268 Due in more than five years 646 — — — (112) 534 Total long-term funding agreements 2,292 — — (490) — 1,802 Total funding agreements (1) $ 6,900 $ 22,950 $ 23,158 $ — $ — $ 6,692 ____________ (1) The $8 million and $9 million difference between the funding agreements carrying value shown in fair value table for June 30, 2020 and December 31, 2019, respectively, reflects the remaining amortization of a hedge implemented and closed, which locked in the funding agreements borrowing rates. Guarantees and Other Commitments The Company provides certain guarantees or commitments to affiliates and others. At June 30, 2020, these arrangements include commitments by the Company to provide equity financing of $1.2 billion (including $219 million with affiliates) to certain limited partnerships and real estate joint ventures under certain conditions. Management believes the Company will not incur material losses as a result of these commitments. The Company is the obligor under certain structured settlement agreements it had entered into with unaffiliated insurance companies and beneficiaries. To satisfy its obligations under these agreements, the Company owns single premium annuities issued by previously wholly-owned life insurance subsidiaries. The Company has directed payment under these annuities to be made directly to the beneficiaries under the structured settlement agreements. A contingent liability exists with respect to these agreements should the previously wholly-owned subsidiaries be unable to meet their obligations. Management believes the need for the Company to satisfy those obligations is remote. The Company had $17 million of undrawn letters of credit related to reinsurance at June 30, 2020. The Company had $481 million of commitments under existing mortgage loan agreements at June 30, 2020. Pursuant to certain assumption agreements (the “Assumption Agreements”), AXA Financial legally assumed primary liability from Equitable Financial for all current and future liabilities of Equitable Financial under certain employee benefit plans that provide participants with medical, life insurance and deferred compensation benefits as well as under the AXA Equitable Retirement plan, a frozen qualified pension plan. Equitable Financial remains secondarily liable for its obligations under these plans and would recognize such liabilities in the event AXA Financial does not perform under the terms of the Assumption Agreements. On October 1, 2018, AXA Financial merged with and into its direct parent, Holdings, with Holdings continuing as the surviving entity. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Funding Agreement-Backed Notes Program Pursuant to a funding agreement-backed notes program, Equitable Financial may issue funding agreements to a Delaware special purpose statutory trust (the “Trust”) in exchange for the proceeds from issuances of fixed and floating rate medium-term marketable notes issued by the Trust from time to time (the “Trust notes”). The funding agreements have matching interest and maturity payment terms to the applicable Trust notes. The maximum aggregate principal amount of Trust notes permitted to be outstanding at any one time is $5 billion. Effective July 7, 2020, Equitable Financial issued a $650 million funding agreement to the Trust. The funding agreement has a fixed interest rate of 1.4% per annum and will mature on July 7, 2025. Funding agreements issued to the Trust will be reported in Policyholders’ account balances in the consolidated balance sheets in subsequent periods. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The unaudited interim consolidated financial statements (the “consolidated financial statements”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to the Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments necessary for a fair presentation of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature, with the exception of the Company’s update of its interest rate assumption and adoption of new economic scenario generator as further described below in Assumption Updates and Model Changes. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The accompanying unaudited consolidated financial statements present the consolidated results of operations, financial condition and cash flows of the Company and its subsidiaries and those investment companies, partnerships and joint ventures in which the Company has control and a majority economic interest as well as those variable interest entities (“VIEs”) that meet the requirements for consolidation. All significant intercompany transactions and balances have been eliminated in consolidation. The terms “second quarter 2020” and “second quarter 2019” refer to the three months ended June 30, 2020 and 2019, respectively. The terms “first six months of 2020” and “first six months of 2019” refer to the six months ended June 30, 2020 and 2019, respectively. |
Adoption of New Accounting Pronouncements and Future Adoption of New Accounting Pronouncements | Adoption of New Accounting Pronouncements Description Effect on the Financial Statement or Other Significant Matters ASU 2016-13: Financial Instruments—Credit Losses (Topic 326), as clarified and amended by ASU 2018-19: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, ASU 2019-04: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments and ASU 2019-05: Financial Instruments—Credit Losses (Topic 326) Targeted Transition Relief, ASU 2019-11: Codification Improvements to Topic 326, Financial Instruments-Credit Losses ASU 2016-13 contains new guidance which introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. On January 1, 2020, the Company adopted the new standard and completed implementation of its updated current expected credit losses (“CECL”) models, processes and controls related to the identified financial assets that fall within the scope of the new standard. Upon adoption, the Company recorded a cumulative effect adjustment to reduce the opening retained earnings balance by approximately $40 million, on a pre-tax and pre-DAC basis. The adjustment is primarily attributable to an increase in the allowance for credit losses associated with the Company’s commercial and agricultural mortgage loan portfolios and reinsurance. ASU 2018-13 : Fair Value Measurement (Topic 820) This ASU improves the effectiveness of fair value disclosures in the notes to financial statements. Amendments in this ASU impact the disclosure requirements in Topic 820, including the removal, modification and addition to existing disclosure requirements. The Company elected to early adopt during 2019 the removal of disclosures relating to transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for timing of transfers between levels and valuation processes for Level 3 fair value measurements. The Company adopted the additional disclosures related to Level 3 fair value information on January 1, 2020. ASU 2018-17: Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities This ASU provides guidance requiring that indirect interests held through related parties in common control arrangements be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. The Company adopted this new standard effective for January 1, 2020. Adoption of this standard did not materially impact the Company’s financial position or results of operations. Future Adoption of New Accounting Pronouncements Description Effective Date and Method of Adoption Effect on the Financial Statement or Other Significant Matters ASU 2018-12 : Financial Services - Insurance (Topic 944); ASU 2019-09: Financial Services - Insurance (Topic 944): Effective Date This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: In November 2019, ASU 2019-09 was issued which modified ASU 2018-12 to be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. Early adoption is permitted. On July 9, 2020, the FASB issued an exposure draft which proposed a one-year deferral of the effective date of the amendments in ASU 2018-12 for all insurance entities. Early adoption would still be allowed. The Company is currently evaluating the impact that adoption of this guidance will have on the Company’s consolidated financial statements, however the adoption of the ASU is expected to have a significant impact on the Company’s consolidated financial condition, results of operations, cash flows and required disclosures, as well as processes and controls. Description Effective Date and Method of Adoption Effect on the Financial Statement or Other Significant Matters 2. Measurement of market risk benefits (“MRBs”). MRBs, as defined under the ASU, will encompass certain variable annuity guaranteed benefit (“GMxB”) features associated with variable annuity products and other general account annuities with other than nominal market risk. The ASU requires MRBs to be measured at fair value with changes in value attributable to changes in instrument-specific credit risk recognized in Other comprehensive income (“OCI”). For MRBs, the ASU should be applied retrospectively as of the beginning of the earliest period presented. ASU 2019-12: Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes This ASU simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740, as well as clarifying and amending existing guidance. Effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. The Company is currently evaluating the impact adopting the guidance will have on the Company’s consolidated financial statements, however the adoption is not expected to materially impact the Company’s financial position, results of operation, or cash flows. ASU2020-04: Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting The amendments in this ASU provide optional expedients and exceptions to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. This ASU is effective as of March 12, 2020 through December 31, 2022. The Company will determine the applicability of the optional expedients and exceptions provided under the ASU as reference rate reform continues to develop. |
Investments | Investments The carrying values of fixed maturities classified as available-for-sale (“AFS”) are reported at fair value. Changes in fair value are reported in OCI, net of allowance for credit losses, policy related amounts and deferred income taxes. With the adoption of the new Financial Instruments-Credit Losses standard, changes in credit losses are recognized in Investment gains (losses), net. The redeemable preferred stock investments that are reported in fixed maturities include real estate investment trusts (“REIT”), perpetual preferred stock and redeemable preferred stock. These securities may not have a stated maturity, may not be cumulative and do not provide for mandatory redemption by the issuer. The Company determines the fair values of fixed maturities and equity securities based upon quoted prices in active markets, when available, or through the use of alternative approaches when market quotes are not readily accessible or available. These alternative approaches include matrix or model pricing and use of independent pricing services, each supported by reference to principal market trades or other observable market assumptions for similar securities. More specifically, the matrix pricing approach to fair value is a discounted cash flow methodology that incorporates market interest rates commensurate with the credit quality and duration of the investment. The Company’s management, with the assistance of its investment advisors, evaluates AFS debt securities that experienced a decline in fair value below amortized cost for credit losses which are evaluated in accordance with the new financial instruments credit losses guidance effective January 1, 2020. Integral to this review is an assessment made each quarter, on a security-by-security basis, by the Company’s Investments Under Surveillance (“IUS”) Committee, of various indicators of credit deterioration to determine whether the investment security has experienced a credit loss. This assessment includes, but is not limited to, consideration of the severity of the unrealized loss, failure, if any, of the issuer of the security to make scheduled payments, actions taken by rating agencies, adverse conditions specifically related to the security or sector, the financial strength, liquidity and continued viability of the issuer. The Company recognizes an allowance for credit losses on AFS debt securities with a corresponding adjustment to earnings rather than a direct write down that reduces the cost basis of the investment, and credit losses are limited to the amount by which the security’s amortized cost basis exceeds its fair value. Any improvements in estimated credit losses on AFS debt securities are recognized immediately in earnings. Management does not use the length of time a security has been in an unrealized loss position as a factor, either by itself or in combination with other factors, to conclude that a credit loss does not exist, as they were permitted to do prior to January 1, 2020. If there is no intent to sell or likely requirement to dispose of the fixed maturity security before its recovery, only the credit loss component of any resulting allowance is recognized in income (loss) and the remainder of the fair value loss is recognized in OCI. The amount of credit loss is the shortfall of the present value of the cash flows expected to be collected as compared to the amortized cost basis of the security. The present value is calculated by discounting management’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security at the date of acquisition. Projections of future cash flows are based on assumptions regarding probability of default and estimates regarding the amount and timing of recoveries. These assumptions and estimates require use of management judgment and consider internal credit analyses as well as market observable data relevant to the collectability of the security. Write-offs of AFS debt securities are recorded when all or a portion of a financial asset is deemed uncollectible. Full or partial write-offs are recorded as reductions to the amortized cost basis of the AFS debt security and deducted from the allowance in the period in which the financial assets are deemed uncollectible. The Company elected to reverse accrued interest deemed uncollectible as a reversal of interest income. In instances where the Company collects cash that it has previously written off, the recovery will be recognized through earnings or as a reduction of the amortized cost basis for interest and principal, respectively. Real estate held for the production of income is stated at depreciated cost less allowance for credit losses. Depreciation of real estate held for production of income is computed using the straight-line method over the estimated useful lives of the properties, which generally range from 40 to 50 years. Policy loans represent funds loaned to policyholders up to the cash surrender value of the associated insurance policies and are carried at the unpaid principal balances due to the Company from the policyholders. Interest income on policy loans is recognized in net investment income at the contract interest rate when earned. Policy loans are fully collateralized by the cash surrender value of the associated insurance policies. Partnerships, investment companies and joint venture interests that the Company has control of and has an economic interest in or those that meet the requirements for consolidation under accounting guidance for consolidation of VIEs are consolidated. Those that the Company does not have control of and does not have a majority economic interest in and those that do not meet the VIE requirements for consolidation are reported on the equity method of accounting and are reported in other equity investments. The Company records its interests in certain of these partnerships on a month or one quarter lag. Trading securities, which include equity securities and fixed maturities, are carried at fair value based on quoted market prices, with realized and unrealized gains (losses) reported in net investment income (loss) in the consolidated statements of income (loss). Corporate owned life insurance (“COLI”) has been purchased by the Company and certain subsidiaries on the lives of certain key employees and the Company and these subsidiaries are named as beneficiaries under these policies. COLI is carried at the cash surrender value of the policies. At June 30, 2020 and December 31, 2019, the carrying value of COLI was $947 million and $942 million, respectively, and is reported in Other invested assets in the consolidated balance sheets. Cash and cash equivalents includes cash on hand, demand deposits, money market accounts, overnight commercial paper and highly liquid debt instruments purchased with an original maturity of three months or less. Due to the short-term nature of these investments, the recorded value is deemed to approximate fair value. All securities owned, including U.S. government and agency securities, mortgage-backed securities, futures and forwards transactions, are reported in the consolidated financial statements on a trade-date basis. Commercial and Agricultural Mortgage Loans on Real Estate Mortgage loans are stated at unpaid principal balances, net of unamortized discounts and the allowance for credit losses. The Company calculates the allowance for credit losses in accordance with the CECL model in order to provide for the risk of credit losses in the lending process. Expected credit losses for loans with similar risk characteristics are estimated on a collective (i.e., pool) basis in order to meet CECL’s risk of loss concept which requires the Company to consider possibilities of loss, even if remote. For collectively evaluated mortgages, the Company estimates the allowance for credit losses based on the amortized cost basis of its mortgages over their expected life using a probability of default (“PD”) / loss given default (“LGD”) model. The PD/LGD model incorporates the Company’s reasonable and supportable forecast of macroeconomic information over a specified period. For periods beyond the reasonable and supportable forecast period, the model reverts to historical loss information. The CECL model is configured to the Company’s specifications and takes into consideration the detailed risk attributes of each discrete loan in the mortgage portfolio which include, but are not limited to the following: • Loan-to-value (“LTV”) ratio - Derived from current loan balance divided by the fair market value of the property. An LTV ratio in excess of 100% indicates an underwater mortgage. • Debt service coverage (“DSC”) ratio - Derived from actual operating earnings divided by annual debt service. If the ratio is below 1.0x, then the income from the property does not support the debt. • Occupancy - Criteria varies by property type but low or below market occupancy is an indicator of sub-par property performance. • Lease expirations - The percentage of leases expiring in the upcoming 12 to 36 months are monitored as a decline in rent and/or occupancy may negatively impact the debt service coverage ratio. In the case of single-tenant properties or properties with large tenant exposure, the lease expiration is a material risk factor. • Other - Any other factors such as maturity, borrower/tenant related issues, payment status, property condition, or current economic conditions may call into question the performance of the loan. Mortgage loans that do not share similar risk characteristics with other loans in the portfolio are individually evaluated quarterly by the Company’s IUS Committee. The allowance for credit losses on these individually evaluated mortgages is a loan-specific reserve as a result of the loan review process that is recorded based on the present value of expected future cash flows discounted at the loan’s effective interest rate or based on the fair value of the collateral. The individually assessed allowance for mortgage loans can increase or decrease from period to period based on such factors. Individually assessed loans may include, but are not limited to, mortgages that have deteriorated in credit quality such as troubled debt restructurings (“TDR”) and reasonably expected TDRs, mortgages for which foreclosure is probable, and mortgages which have been classified as “potential problem” or “problem” loans within the Company’s IUS Committee processes as described below. Within the IUS process, Commercial mortgages 60 days or more past due and agricultural mortgages 90 days or more past due, as well as all mortgages in the process of foreclosure, are identified as problem mortgages. Based on its monthly monitoring of mortgages, a class of potential problem mortgages are also identified, consisting of mortgage loans not currently classified as problem mortgages but for which management has doubts as to the ability of the borrower to comply with the present loan payment terms and which may result in the loan becoming a problem or being modified. The decision whether to classify a performing mortgage loan as a potential problem involves judgments by management as to likely future industry conditions and developments with respect to the borrower or the individual mortgaged property. Individually assessed mortgage loans without provision for losses are mortgage loans where the fair value of the collateral or the net present value of the expected future cash flows related to the loan equals or exceeds the recorded investment. Interest income earned on mortgage loans where the collateral value is used to measure impairment is recorded on a cash basis. Interest income on mortgage loans where the present value method is used to measure impairment is accrued on the net carrying value amount of the loan at the interest rate used to discount the cash flows. Mortgage loans are placed on nonaccrual status once management believes the collection of accrued interest is not probable. Once mortgage loans are classified as nonaccrual mortgage loans, interest income is recognized under the cash basis of accounting and the resumption of the interest accrual would commence only after all past due interest has been collected or the mortgage loan has been restructured to where the collection of interest is considered likely. The Company charges off loan balances and accrued interest that are deemed uncollectible. Net Investment Income (Loss), Investment Gains (Losses), Net, and Unrealized Investment Gains (Losses) Realized investment gains (losses) are determined by identification with the specific asset and are presented as a component of revenue. Changes in the allowance for credit losses are included in Investment gains (losses), net. Realized and unrealized holding gains (losses) on trading and equity securities are reflected in Net investment income (loss). Unrealized investment gains (losses) on fixed maturities designated as AFS held by the Company are accounted for as a separate component of AOCI, net of related deferred income taxes, as are amounts attributable to certain pension operations, Closed Block’s policyholders’ dividend obligation, insurance liability loss recognition, DAC related to UL policies, investment-type products and participating traditional life policies. Changes in unrealized gains (losses) reflect changes in fair value of only those fixed maturities classified as AFS and do not reflect any change in fair value of policyholders’ account balances and future policy benefits. |
Accounting and Consolidation of VIEs | Accounting and Consolidation of VIEs For all new investment products and entities developed by the Company (other than Collateralized Debt Obligations (“CDOs”)), the Company first determines whether the entity is a VIE, which involves determining an entity’s variability and variable interests, identifying the holders of the equity investment at risk and assessing the five characteristics of a VIE. Once an entity has been determined to be a VIE, the Company then identifies the primary beneficiary of the VIE. If the Company is deemed to be the primary beneficiary of the VIE, then the Company consolidates the entity. Management of the Company reviews quarterly its investment management agreements and its investments in, and other financial arrangements with, certain entities that hold client assets under management (“AUM”) to determine the entities that the Company is required to consolidate under this guidance. These entities include certain mutual fund products, hedge funds, structured products, group trusts, collective investment trusts and limited partnerships. The analysis performed to identify variable interests held, determine whether entities are VIEs or voting interest entities (“VOEs”), and evaluate whether the Company has a controlling financial interest in such entities requires the exercise of judgment and is updated on a continuous basis as circumstances change or new entities are developed. The primary beneficiary evaluation generally is performed qualitatively based on all facts and circumstances, including consideration of economic interests in the VIE held directly and indirectly through related parties and entities under common control, as well as quantitatively, as appropriate. Consolidated VIEs At June 30, 2020 and December 31, 2019, the Company consolidated one real estate joint venture for which it was identified as the primary beneficiary under the VIE model. The consolidated entity is jointly owned by Equitable Financial and AXA France and holds an investment in a real estate venture. Included in Other invested assets in the Company’s consolidated balance sheets at June 30, 2020 and December 31, 2019 are total assets o f $30 million an d $32 million, respectively related to this VIE, primarily resulting from the consolidated presentation of this real estate joint venture as real estate held for sale. Redeemable noncontrolling interests are presented in mezzanine equity and non-redeemable noncontrolling interests are presented within permanent equity. Non-Consolidated VIEs At June 30, 2020 and December 31, 2019, respectively, the Company held approximately $1.1 billion and $1.1 billion of investment assets in the form of equity interests issued by non-corporate legal entities determined under the guidance to be VIEs, such as limited partnerships and limited liability companies, including hedge funds, private equity funds and real estate-related funds. As an equity investor, the Company is considered to have a variable interest in each of these VIEs as a result of its participation in the risks and/or rewards these funds were designed to create by their defined portfolio objectives and strategies. Primarily through qualitative assessment, including consideration of related party interests or other financial arrangements, if any, the Company was not identified as primary beneficiary of any of these VIEs, largely due to its inability to direct the activities that most significantly impact their economic performance. Consequently, the Company continues to reflect these equity interests in the consolidated balance sheets as Other equity investments and applies the equity method of accounting for these positions. The net assets of these non-consolidated VIEs are approximately $146.6 billion and $160.2 billion at June 30, 2020 and December 31, 2019, respectively. The Company’s maximum exposure to loss from its direct involvement with these VIEs is the carrying value of its investment of $1.1 billion and $1.1 billion and approximately $1.2 billion and $1.1 billion of unfunded commitments at June 30, 2020 and December 31, 2019, respectively. The Company has no further economic interest in these VIEs in the form of guarantees, derivatives, credit enhancements or similar instruments and obligations. In addition, at June 30, 2020 and December 31, 2019, Other invested assets includes real estate held for sale of $(5) million and $(5) million, respectively, as related to one non-consolidated real estate joint venture. |
Fair Value Measurement | U.S. GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value, and identifies three levels of inputs that may be used to measure fair value: Level 1 Unadjusted quoted prices for identical instruments in active markets. Level 1 fair values generally are supported by market transactions that occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, and inputs to model-derived valuations that are directly observable or can be corroborated by observable market data. Level 3 Unobservable inputs supported by little or no market activity and often requiring significant management judgment or estimation, such as an entity’s own assumptions about the cash flows or other significant components of value that market participants would use in pricing the asset or liability. The Company uses unadjusted quoted market prices to measure fair value for those instruments that are actively traded in financial markets. In cases where quoted market prices are not available, fair values are measured using present value or other valuation techniques. The fair value determinations are made at a specific point in time, based on available market information and judgments about the financial instrument, including estimates of the timing and amount of expected future cash flows and the credit standing of counterparties. Such adjustments do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they consider the tax impact of the realization of unrealized gains or losses. In many cases, the fair value cannot be substantiated by direct comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instrument. Management is responsible for the determination of the value of investments carried at fair value and the supporting methodologies and assumptions. Under the terms of various service agreements, the Company often utilizes independent valuation service providers to gather, analyze, and interpret market information and derive fair values based upon relevant methodologies and assumptions for individual securities. These independent valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of widely accepted valuation models, provide a single fair value measurement for individual securities for which a fair value has been requested. As further described below with respect to specific asset classes, these inputs include, but are not limited to, market prices for recent trades and transactions in comparable securities, benchmark yields, interest rate yield curves, credit spreads, quoted prices for similar securities, and other market-observable information, as applicable. Specific attributes of the security being valued also are considered, including its term, interest rate, credit rating, industry sector, and when applicable, collateral quality and other security- or issuer-specific information. When insufficient market observable information is available upon which to measure fair value, the Company either will request brokers knowledgeable about these securities to provide a non-binding quote or will employ internal valuation models. Fair values received from independent valuation service providers and brokers and those internally modeled or otherwise estimated are assessed for reasonableness. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Adoption of New Accounting Pronouncements Description Effect on the Financial Statement or Other Significant Matters ASU 2016-13: Financial Instruments—Credit Losses (Topic 326), as clarified and amended by ASU 2018-19: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, ASU 2019-04: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments and ASU 2019-05: Financial Instruments—Credit Losses (Topic 326) Targeted Transition Relief, ASU 2019-11: Codification Improvements to Topic 326, Financial Instruments-Credit Losses ASU 2016-13 contains new guidance which introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. On January 1, 2020, the Company adopted the new standard and completed implementation of its updated current expected credit losses (“CECL”) models, processes and controls related to the identified financial assets that fall within the scope of the new standard. Upon adoption, the Company recorded a cumulative effect adjustment to reduce the opening retained earnings balance by approximately $40 million, on a pre-tax and pre-DAC basis. The adjustment is primarily attributable to an increase in the allowance for credit losses associated with the Company’s commercial and agricultural mortgage loan portfolios and reinsurance. ASU 2018-13 : Fair Value Measurement (Topic 820) This ASU improves the effectiveness of fair value disclosures in the notes to financial statements. Amendments in this ASU impact the disclosure requirements in Topic 820, including the removal, modification and addition to existing disclosure requirements. The Company elected to early adopt during 2019 the removal of disclosures relating to transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for timing of transfers between levels and valuation processes for Level 3 fair value measurements. The Company adopted the additional disclosures related to Level 3 fair value information on January 1, 2020. ASU 2018-17: Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities This ASU provides guidance requiring that indirect interests held through related parties in common control arrangements be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. The Company adopted this new standard effective for January 1, 2020. Adoption of this standard did not materially impact the Company’s financial position or results of operations. Future Adoption of New Accounting Pronouncements Description Effective Date and Method of Adoption Effect on the Financial Statement or Other Significant Matters ASU 2018-12 : Financial Services - Insurance (Topic 944); ASU 2019-09: Financial Services - Insurance (Topic 944): Effective Date This ASU provides targeted improvements to existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. The ASU primarily impacts four key areas, including: In November 2019, ASU 2019-09 was issued which modified ASU 2018-12 to be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. Early adoption is permitted. On July 9, 2020, the FASB issued an exposure draft which proposed a one-year deferral of the effective date of the amendments in ASU 2018-12 for all insurance entities. Early adoption would still be allowed. The Company is currently evaluating the impact that adoption of this guidance will have on the Company’s consolidated financial statements, however the adoption of the ASU is expected to have a significant impact on the Company’s consolidated financial condition, results of operations, cash flows and required disclosures, as well as processes and controls. Description Effective Date and Method of Adoption Effect on the Financial Statement or Other Significant Matters 2. Measurement of market risk benefits (“MRBs”). MRBs, as defined under the ASU, will encompass certain variable annuity guaranteed benefit (“GMxB”) features associated with variable annuity products and other general account annuities with other than nominal market risk. The ASU requires MRBs to be measured at fair value with changes in value attributable to changes in instrument-specific credit risk recognized in Other comprehensive income (“OCI”). For MRBs, the ASU should be applied retrospectively as of the beginning of the earliest period presented. ASU 2019-12: Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes This ASU simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740, as well as clarifying and amending existing guidance. Effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. The Company is currently evaluating the impact adopting the guidance will have on the Company’s consolidated financial statements, however the adoption is not expected to materially impact the Company’s financial position, results of operation, or cash flows. ASU2020-04: Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting The amendments in this ASU provide optional expedients and exceptions to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. This ASU is effective as of March 12, 2020 through December 31, 2022. The Company will determine the applicability of the optional expedients and exceptions provided under the ASU as reference rate reform continues to develop. |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale Securities | The following tables provide information relating to the Company’s fixed maturities classified as AFS. AFS Fixed Maturities by Classification Amortized Allowance for Credit Losses (4) Gross Gross Fair Value (in millions) June 30, 2020: Fixed Maturities: Corporate (1) $ 45,706 $ 13 $ 4,091 $ 154 $ 49,630 U.S. Treasury, government and agency 13,103 — 4,090 — 17,193 States and political subdivisions 607 — 105 — 712 Foreign governments 770 — 69 6 833 Residential mortgage-backed (2) 144 — 14 — 158 Asset-backed (3) 2,057 — 23 41 2,039 Commercial mortgage-backed 855 — 24 — 879 Redeemable preferred stock 373 — 15 10 378 Total at June 30, 2020 $ 63,615 $ 13 $ 8,431 $ 211 $ 71,822 December 31, 2019: Fixed Maturities: Corporate (1) $ 42,347 $ — $ 2,178 $ 61 $ 44,464 U.S. Treasury, government and agency 14,385 — 1,151 305 15,231 States and political subdivisions 584 — 68 3 649 Foreign governments 460 — 35 5 490 Residential mortgage-backed (2) 161 — 12 — 173 Asset-backed (3) 843 — 3 2 844 Redeemable preferred stock 498 — 18 5 511 Total at December 31, 2019 $ 59,278 $ — $ 3,465 $ 381 $ 62,362 ______________ (1) Corporate fixed maturities include both public and private issues. (2) Includes publicly traded agency pass-through securities and collateralized obligations. (3) Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans. (4) Amounts represent the allowance for credit losses for 2020 - (see Note 2 Significant Accounting Policies - Investments). |
Investments Classified by Contractual Maturity Date | The contractual maturities of AFS fixed maturities at June 30, 2020 are shown in the table below. Bonds not due at a single maturity date have been included in the table in the final year of maturity. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Contractual Maturities of AFS Fixed Maturities Amortized Cost (Less Allowance for Credit Losses) Fair Value (in millions) June 30, 2020 (1): Contractual maturities: Due in one year or less $ 4,393 $ 4,433 Due in years two through five 14,167 14,944 Due in years six through ten 16,475 18,256 Due after ten years 25,138 30,735 Subtotal 60,173 68,368 Residential mortgage-backed 144 158 Asset-backed 2,057 2,039 Commercial mortgage-backed 855 879 Redeemable preferred stock 373 378 Total at June 30, 2020 $ 63,602 $ 71,822 ______________ (1) Net amortized cost is equal to amortized cost, less any allowance for credit losses to the extent applicable. |
Available For Sale Fixed Maturities Proceeds Gross Gains And Gross Losses From Sales And Other Than Temporary Impairments | The following table shows proceeds from sales, gross gains (losses) from sales and credit losses for AFS fixed maturities for the three and six months ended June 30, 2020 and 2019: Proceeds from Sales, Gross Gains (Losses) from Sales and Credit Losses for AFS Fixed Maturities Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Proceeds from sales $ 2,864 $ 1,556 $ 4,586 $ 2,917 Gross gains on sales $ 205 $ 9 $ 274 $ 17 Gross losses on sales $ (24) $ (6) $ (27) $ (21) Credit losses (1) $ (11) $ — $ (13) $ — ______________ |
Fixed Maturities Credit Loss Impairments | The following table sets forth the amount of credit loss impairments on AFS fixed maturities held by the Company at the dates indicated and the corresponding changes in such amounts. AFS Fixed Maturities - Credit Loss Impairments Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Balance, beginning of period $ (17) $ (18) $ (15) $ (46) Previously recognized impairments on securities that matured, paid, prepaid or sold — — — 28 Recognized impairments on securities impaired to fair value this period (1) — — — — Credit losses recognized this period on securities for which credit losses were not previously recognized (8) — (10) — Additional credit losses this period on securities previously impaired (3) — (3) — Increases due to passage of time on previously recorded credit losses — — — — Accretion of previously recognized impairments due to increases in expected cash flows (for OTTI securities 2019 and prior) — — — — Balance at June 30, $ (28) $ (18) $ (28) $ (18) ______________ (1) Represents circumstances where the Company determined in the current period that it intends to sell the security, or it is more likely than not that it will be required to sell the security before recovery of the security’s amortized cost. |
Net Unrealized Gains (Losses) on Available-for-Sale Fixed Maturities | The tables that follow below present a roll-forward of net unrealized investment gains (losses) recognized in AOCI, split between amounts related to fixed maturities on which a credit loss has been recognized, and all other. Net Unrealized Gains (Losses) on AFS Fixed Maturities Net Unrealized Gains (Losses) on Investments DAC Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) (in millions) Balance, April 1, 2020 $ 5,040 $ (205) $ (1,003) $ (805) $ 3,027 Net investment gains (losses) arising during the period 3,336 — — — 3,336 Reclassification adjustment: — Included in Net income (loss) (167) — — — (167) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — (289) — — (289) Deferred income taxes — — — (437) (437) Policyholders’ liabilities — — (799) — (799) Net unrealized investment gains (losses) excluding credit losses 8,209 (494) (1,802) (1,242) 4,671 Net unrealized investment gains (losses) with credit losses (2) — 1 — (1) Balance, June 30, 2020 $ 8,207 $ (494) $ (1,801) $ (1,242) $ 4,670 Balance, April 1, 2019 $ 1,003 $ (616) $ 22 $ (86) $ 323 Net investment gains (losses) arising during the period 1,623 — — — 1,623 Reclassification adjustment: — Included in Net income (loss) (4) — — — (4) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — 82 — — 82 Deferred income taxes — — — (334) (334) Policyholders’ liabilities — — (108) — (108) Net unrealized investment gains (losses) excluding credit losses 2,622 (534) (86) (420) 1,582 Net unrealized investment gains (losses) with credit losses (1) 2 — — — 2 Balance, June 30, 2019 $ 2,624 $ (534) $ (86) $ (420) $ 1,584 Net Unrealized Gains (Losses) on Investments DAC Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) (in millions) Balance, January 1, 2020 $ 3,084 $ (831) $ (192) $ (433) $ 1,628 Net investment gains (losses) arising during the period 5,362 — — — 5,362 Reclassification adjustment: — Included in Net income (loss) (230) — — — (230) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — 336 — — 336 Net Unrealized Gains (Losses) on Investments DAC Policyholders’ Liabilities Deferred Income Tax Asset (Liability) AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) (in millions) Deferred income taxes — — — (810) (810) Policyholders’ liabilities — — (1,611) — (1,611) Net unrealized investment gains (losses) excluding credit losses 8,216 (495) (1,803) (1,243) 4,675 Net unrealized investment gains (losses) with credit losses (9) 1 2 1 (5) Balance, June 30, 2020 $ 8,207 $ (494) $ (1,801) $ (1,242) $ 4,670 Balance, January 1, 2019 $ (577) $ 39 $ (55) $ 125 $ (468) Net investment gains (losses) arising during the period 3,206 — — — 3,206 Reclassification adjustment: Included in Net income (loss) (7) — — — (7) Excluded from Net income (loss) — — — — — Impact of net unrealized investment gains (losses) on: DAC — (573) — — (573) Deferred income taxes — — — (545) (545) Policyholders’ liabilities — — (31) — (31) Net unrealized investment gains (losses) excluding credit losses 2,622 (534) (86) (420) 1,582 Net unrealized investment gains (losses) with credit losses (1) 2 — — — 2 Balance, June 30, 2019 $ 2,624 $ (534) $ (86) $ (420) $ 1,584 ______________ (1) Credit losses for 2019 were OTTI losses. |
Continuous Gross Unrealized Losses for Available-for-Sale Fixed Maturities | The following tables disclose the fair values and gross unrealized losses of the 639 issues at June 30, 2020 and the 390 issues at December 31, 2019 that are not deemed to have credit losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the specified periods at the dates indicated: AFS Fixed Maturities in an Unrealized Loss Position for Which No Allowance Is Recorded Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in millions) June 30, 2020: Fixed Maturities: Corporate $ 2,511 $ 96 $ 273 $ 51 $ 2,784 $ 147 Foreign governments 47 6 — — 47 6 Asset-backed 1,349 37 73 4 1,422 41 Redeemable preferred stock 121 8 11 2 132 10 Total at June 30, 2020 $ 4,028 $ 147 $ 357 $ 57 $ 4,385 $ 204 December 31, 2019: (1) Fixed Maturities: Corporate $ 2,669 $ 41 $ 366 $ 20 $ 3,035 $ 61 Less Than 12 Months 12 Months or Longer Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in millions) U.S. Treasury, government and agency 4,245 305 2 — 4,247 305 States and political subdivisions 123 3 — — 123 3 Foreign governments 11 — 47 5 58 5 Asset-backed 319 — 201 2 520 2 Redeemable preferred stock 29 — 49 5 78 5 Total at December 31, 2019 $ 7,396 $ 349 $ 665 $ 32 $ 8,061 $ 381 ______________ (1) Amounts represents fixed maturities in an unrealized loss position that are not deemed to be other-than-temporarily impaired for 2019. |
Financing Receivable, Allowance for Credit Loss | The change in the allowance for credit losses for commercial mortgage loans and agricultural mortgage loans during the three and six months ended June 30, 2020 was as follows: Three Months Ended June 30, 2020 Six Months Ended June 30, 2020 (in millions) Allowance for credit losses on mortgage loans (1): Commercial mortgages: Balance, beginning of period $ (43) $ (33) Current-period provision for expected credit losses (19) (29) Write-offs charged against the allowance — — Recoveries of amounts previously written off — — Net change in allowance (19) (29) Ending Balance, June 30, $ (62) $ (62) Agricultural mortgages: Balance, beginning of period $ (3) $ (3) Current-period provision for expected credit losses (1) (1) Write-offs charged against the allowance — — Recoveries of amounts previously written off — — Net change in allowance (1) (1) Ending Balance, June 30, $ (4) $ (4) Total allowance for credit losses $ (66) $ (66) ____________ (1) See Note 2 for discussion of the transition balance. |
Financing Receivable Credit Quality Indicators | The following tables summarize the Company’s mortgage loans segregated by risk rating exposure at June 30, 2020. LTV Ratios (1)(3) At June 30, 2020 Amortized Cost Basis by Origination Year 2020 2019 2018 2017 2016 Prior Total (in millions) Mortgage loans: Commercial: 0% - 50% $ — $ — $ 29 $ 324 $ 196 $ 748 $ 1,297 50% - 70% 656 613 915 759 2,501 1,714 7,158 70% - 90% 90 184 304 113 58 464 1,213 90% plus — — — 5 — 156 161 Total commercial $ 746 $ 797 $ 1,248 $ 1,201 $ 2,755 $ 3,082 $ 9,829 Agricultural: 0% - 50% $ 106 $ 139 $ 159 $ 167 $ 254 $ 733 $ 1,558 50% - 70% 204 139 186 112 129 394 1,164 70% - 90% — — 3 — — 18 21 90% plus — — — — — — — Total agricultural $ 310 $ 278 $ 348 $ 279 $ 383 $ 1,145 $ 2,743 Total mortgage loans: 0% - 50% $ 106 $ 139 $ 188 $ 491 $ 450 $ 1,481 $ 2,855 50% - 70% 860 752 1,101 871 2,630 2,108 8,322 70% - 90% 90 184 307 113 58 482 1,234 90% plus — — — 5 — 156 161 Total mortgage loans $ 1,056 $ 1,075 $ 1,596 $ 1,480 $ 3,138 $ 4,227 $ 12,572 Debt Service Coverage Ratios (2)(3) At June 30, 2020 Amortized Cost Basis by Origination Year 2020 2019 2018 2017 2016 Prior Total (in millions) Mortgage loans: Commercial: Greater than 2.0x $ 621 $ 373 $ 800 $ 377 $ 2,134 $ 1,315 $ 5,620 1.8x to 2.0x 90 187 123 409 70 484 1,363 1.5x to 1.8x 35 183 230 302 551 610 1,911 1.2x to 1.5x — 12 12 76 — 673 773 1.0x to 1.2x — 42 83 37 — — 162 Less than 1.0x — — — — — — — Total commercial $ 746 $ 797 $ 1,248 $ 1,201 $ 2,755 $ 3,082 $ 9,829 Agricultural Greater than 2.0x $ 43 $ 28 $ 39 $ 37 $ 76 $ 162 $ 385 1.8x to 2.0x 11 36 15 17 21 91 191 1.5x to 1.8x 75 39 46 43 52 232 487 1.2x to 1.5x 110 126 148 110 158 349 1,001 1.0x to 1.2x 67 39 92 71 58 275 602 Less than 1.0x 4 10 8 1 18 36 77 Total agricultural $ 310 $ 278 $ 348 $ 279 $ 383 $ 1,145 $ 2,743 At June 30, 2020 Amortized Cost Basis by Origination Year 2020 2019 2018 2017 2016 Prior Total (in millions) Total mortgage loans Greater than 2.0x $ 664 $ 401 $ 839 $ 414 $ 2,210 $ 1,477 $ 6,005 1.8x to 2.0x 101 223 138 426 91 575 1,554 1.5x to 1.8x 110 222 276 345 603 842 2,398 1.2x to 1.5x 110 138 160 186 158 1,022 1,774 1.0x to 1.2x 67 81 175 108 58 275 764 Less than 1.0x 4 10 8 1 18 36 77 Total mortgage loans $ 1,056 $ 1,075 $ 1,596 $ 1,480 $ 3,138 $ 4,227 $ 12,572 _____________ (1) The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan. (2) The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service. (3) Amounts presented at amortized cost basis. The following tables provide information relating to the LTV and DSC ratios for commercial and agricultural mortgage loans at June 30, 2020 and December 31, 2019. The values used in these ratio calculations were developed as part of the periodic review of the commercial and agricultural mortgage loan portfolio, which includes an evaluation of the underlying collateral value. Mortgage Loans by LTV and DSC Ratios DSC Ratio (2) (3) LTV Ratio (1) (3): Greater than 2.0x 1.8x to 2.0x 1.5x to 1.8x 1.2x to 1.5x 1.0x to 1.2x Less than 1.0x Total (in millions) June 30, 2020: Mortgage loans: Commercial: 0% - 50% $ 1,016 $ 20 $ 237 $ 24 $ — $ — $ 1,297 50% - 70% 4,208 1,080 1,353 485 32 — 7,158 70% - 90% 312 263 321 187 130 — 1,213 90% plus 84 — — 77 — — 161 Total commercial $ 5,620 $ 1,363 $ 1,911 $ 773 $ 162 $ — $ 9,829 Agricultural: 0% - 50% $ 292 $ 106 $ 255 $ 520 $ 333 $ 52 $ 1,558 50% - 70% 93 83 232 462 269 25 1,164 70% - 90% — 2 — 19 — — 21 90% plus — — — — — — — Total agricultural $ 385 $ 191 $ 487 $ 1,001 $ 602 $ 77 $ 2,743 Total mortgage loans: 0% - 50% $ 1,308 $ 126 $ 492 $ 544 $ 333 $ 52 $ 2,855 50% - 70% 4,301 1,163 1,585 947 301 25 8,322 70% - 90% 312 265 321 206 130 — 1,234 90% plus 84 — — 77 — — 161 Total mortgage loans $ 6,005 $ 1,554 $ 2,398 $ 1,774 $ 764 $ 77 $ 12,572 DSC Ratio (2) (3) LTV Ratio (1) (3): Greater than 2.0x 1.8x to 2.0x 1.5x to 1.8x 1.2x to 1.5x 1.0x to 1.2x Less than 1.0x Total (in millions) December 31, 2019: Mortgage loans: Commercial: 0% - 50% $ 887 $ 38 $ 214 $ 24 $ — $ — $ 1,163 50% - 70% 4,097 1,195 1,118 795 242 — 7,447 70% - 90% 251 98 214 154 46 — 763 90% plus — — — — — — — Total commercial $ 5,235 $ 1,331 $ 1,546 $ 973 $ 288 $ — $ 9,373 Agricultural: 0% - 50% $ 322 $ 104 $ 241 $ 545 $ 321 $ 50 $ 1,583 50% - 70% 82 87 236 426 251 33 1,115 70% - 90% — — — 19 — — 19 90% plus — — — — — — — Total agricultural $ 404 $ 191 $ 477 $ 990 $ 572 $ 83 $ 2,717 Total mortgage loans: 0% - 50% $ 1,209 $ 142 $ 455 $ 569 $ 321 $ 50 $ 2,746 50% - 70% 4,179 1,282 1,354 1,221 493 33 8,562 70% - 90% 251 98 214 173 46 — 782 90% plus — — — — — — — Total mortgage loans $ 5,639 $ 1,522 $ 2,023 $ 1,963 $ 860 $ 83 $ 12,090 ______________ (1) The LTV ratio is derived from current loan balance divided by the fair value of the property. The fair value of the underlying commercial properties is updated annually for each mortgage loan. (2) The DSC ratio is calculated using the most recently reported operating income results from property operations divided by annual debt service. (3) Amounts presented at amortized cost basis. |
Age Analysis Of Past Due Mortgage Loans | The following table provides information relating to the aging analysis of past-due mortgage loans at June 30, 2020 and December 31, 2019, respectively: Age Analysis of Past Due Mortgage Loans (1) Accruing Loans Non-accruing Loans Total Loans Non-accruing Loans with No Allowance Interest Income on Non-accruing Loans(2) Past Due Current Total 30-59 Days 60-89 Days 90 Days or More Total (in millions) June 30, 2020: Mortgage loans: Commercial $ — $ — $ — $ — $ 9,754 $ 9,754 $ 75 $ 9,829 $ 75 $ 1 Agricultural 67 9 49 125 2,618 2,743 — 2,743 — — Total $ 67 $ 9 $ 49 $ 125 $ 12,372 $ 12,497 $ 75 $ 12,572 $ 75 $ 1 December 31, 2019: Accruing Loans Non-accruing Loans Total Loans Non-accruing Loans with No Allowance Interest Income on Non-accruing Loans(2) Past Due Current Total 30-59 Days 60-89 Days 90 Days or More Total (in millions) Mortgage loans: Commercial $ — $ — $ — $ — $ 9,373 $ 9,373 $ — $ 9,373 $ — $ — Agricultural 57 1 66 124 2,593 2,717 — 2,717 — — Total $ 57 $ 1 $ 66 $ 124 $ 11,966 $ 12,090 $ — $ 12,090 $ — $ — _______________ (1) Amounts presented at amortized cost basis. (2) Amounts for 2020 represent results for both the three and six months ended June 30, 2020. |
Net Investment Income (Loss) from Trading Securities | Net unrealized and realized gains (losses) on trading securities are included in Net investment income (loss) in the Consolidated Statements of Income (Loss). The table below shows a breakdown of Net investment income (loss) from trading securities during the three and six months ended June 30, 2020 and 2019: Net Investment Income (Loss) from Trading Securities Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Net investment gains (losses) recognized during the period on securities held at the end of the period $ 250 $ 150 $ 87 $ 424 Net investment gains (losses) recognized on securities sold during the period 14 1 17 (23) Unrealized and realized gains (losses) on trading securities 264 151 104 401 Interest and dividend income from trading securities 45 71 94 161 Net investment income (loss) from trading securities $ 309 $ 222 $ 198 $ 562 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments by Category | The tables below present quantitative disclosures about the Company’s derivative instruments, including those embedded in other contracts required to be accounted for as derivative instruments: Derivative Instruments by Category At June 30, 2020 Six Months Ended June 30, 2020 Fair Value Notional Derivative Assets Derivative Liabilities Net Derivative Gains (Losses) (2) (in millions) Derivative instruments: Freestanding derivatives (1): Equity contracts: Futures $ 3,848 $ — $ — $ (126) Swaps 17,760 77 79 963 Options 36,469 4,333 2,442 (1,387) Interest rate contracts: Swaps 24,771 2,089 432 3,658 Futures 23,565 — — 2,072 Swaptions — — — 9 Credit contracts: Credit default swaps 1,252 10 4 (7) Other freestanding contracts: Foreign currency contracts 347 — — (3) Margin — 51 77 — Collateral — 14 3,288 — Embedded derivatives: GMIB reinsurance contracts (3) — 3,433 — 1,026 GMxB derivative features liability (4) — — 12,382 (3,946) SCS, SIO, MSO and IUL indexed features (5) — — 1,690 1,377 Total derivative instruments $ 108,012 $ 10,007 $ 20,394 Net derivative gains (losses) (6) $ 3,636 ______________ (1) Reported in Other invested assets in the consolidated balance sheets. (2) Reported in Net derivative gains (losses) in the consolidated statements of income (loss). (3) Reported in GMIB reinsurance contract asset in the consolidated balance sheets. (4) Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets. (5) Reported in Policyholders’ account balances in the consolidated balance sheets. (6) Investment fees of $6 million are reported in Net derivative gains (losses) in the consolidated statements of income (loss). Derivative Instruments by Category At December 31, 2019 Six Months Ended June 30, 2019 Fair Value Notional Amount Derivative Assets Derivative Liabilities Net Derivative Gains (Losses) (2) (in millions) Derivative instruments: Freestanding derivatives (1): Equity contracts: Futures $ 3,510 $ — $ — $ (930) Swaps 17,064 9 279 (1,260) Options 47,766 5,080 1,749 1,276 Interest rate contracts: Swaps 23,700 467 523 1,597 Futures 20,424 — — 25 Swaptions 3,201 16 — 7 Credit contracts: Credit default swaps 1,232 18 — 13 Other freestanding contracts: Foreign currency contracts 501 3 — (27) Margin — 140 — — Collateral — 72 3,001 — Embedded derivatives: GMIB reinsurance contracts (3) — 2,466 — 217 GMxB derivative features liability (4) — — 8,246 (1,116) SCS, SIO, MSO and IUL indexed features (5) — — 3,150 (1,535) Total derivative instruments $ 117,398 $ 8,271 $ 16,948 Net derivative gains (losses) $ (1,733) ______________ (1) Reported in Other invested assets in the consolidated balance sheets. (2) Reported in Net derivative gains (losses) in the consolidated statements of income (loss). (3) Reported in GMIB reinsurance contract asset in the consolidated balance sheets. (4) Reported in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets. (5) Reported in Policyholders’ account balances in the consolidated balance sheets. |
Offsetting Financial Assets and Liabilities and Derivative Instruments | The following table presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments at June 30, 2020: Offsetting of Financial Assets and Liabilities and Derivative Instruments At June 30, 2020 Gross Amount Recognized Gross Amount Offset in the Balance Sheets Net Amount Presented in the Balance Sheets Gross Amount not Offset in the Balance Sheets (1) Net Amount (in millions) Assets: Derivative assets $ 6,573 $ 6,134 $ 439 $ (118) $ 321 Other financial assets 1,523 — 1,523 — 1,523 Other invested assets $ 8,096 $ 6,134 $ 1,962 $ (118) $ 1,844 Liabilities: Derivative liabilities $ 6,203 $ 6,134 $ 69 $ — $ 69 Other financial liabilities 1,462 — 1,462 — 1,462 Other liabilities $ 7,665 $ 6,134 $ 1,531 $ — $ 1,531 ______________ (1) Financial instrument/s sent (held). The following table presents information about the Company’s offsetting of financial assets and liabilities and derivative instruments at December 31, 2019. Offsetting of Financial Assets and Liabilities and Derivative Instruments At December 31, 2019 Gross Amount Recognized Gross Amount Offset in the Balance Sheets Net Amount Presented in the Balance Sheets Gross Amount not Offset in the Balance Sheets (1) Net Amount (in millions) Assets: Derivative assets $ 5,804 $ 5,429 $ 375 $ (77) $ 298 Other financial instruments 1,781 — 1,781 — 1,781 Other invested assets $ 7,585 $ 5,429 $ 2,156 $ (77) $ 2,079 Liabilities: Derivative liabilities $ 5,474 $ 5,429 $ 45 $ — $ 45 Other financial liabilities 1,723 — 1,723 — 1,723 Other liabilities $ 7,197 $ 5,429 $ 1,768 $ — $ 1,768 ______________ (1) Financial instruments sent (held). |
CLOSED BLOCK (Tables)
CLOSED BLOCK (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Closed Block Disclosure [Abstract] | |
Schedule of Closed Block Assets and Liabilities | Summarized financial information for the Company’s Closed Block is as follows: June 30, 2020 December 31, 2019 (in millions) Closed Block Liabilities: Future policy benefits, policyholders’ account balances and other $ 6,327 $ 6,478 Policyholder dividend obligation 150 2 Other liabilities 100 38 Total Closed Block liabilities 6,577 6,518 Assets Designated to the Closed Block: Fixed maturities available-for-sale, at fair value (amortized cost of $3,490 and $3,558) (allowance for credit losses of $0 at June 30, 2020) 3,838 3,754 Mortgage loans on real estate (net of allowance for credit losses of $7 at June 30, 2020) 1,774 1,759 Policy loans 668 706 Cash and other invested assets 44 82 Other assets 183 145 Total assets designated to the Closed Block 6,507 6,446 Excess of Closed Block liabilities over assets designated to the Closed Block 70 72 Amounts included in accumulated other comprehensive income (loss): Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $150 and $2; and net of income tax: $42 and $41 167 164 Maximum future earnings to be recognized from Closed Block assets and liabilities $ 237 $ 236 |
Closed Block Operations, Net Results | The Company’s Closed Block revenues and expenses were as follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Revenues: Premiums and other income $ 40 $ 46 $ 82 $ 94 Net investment income (loss) 63 72 129 139 Investment gains (losses), net (2) — (2) (1) Total revenues 101 118 209 232 Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Benefits and Other Deductions: Policyholders’ benefits and dividends 103 114 206 235 Other operating costs and expenses 1 — 1 1 Total benefits and other deductions 104 114 207 236 Net income (loss), before income taxes (3) 4 2 (4) Income tax (expense) benefit (1) (1) (1) (2) Net income (loss) $ (4) $ 3 $ 1 $ (6) |
INSURANCE LIABILITIES (Tables)
INSURANCE LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Insurance [Abstract] | |
GMDB and GMIB Liabilities and Other Policyholder's Liabilities | Change in Liability for Variable Annuity Contracts with GMDB and GMIB Features and No NLG Feature For the Three and Six Months Ended June 30, 2020 and 2019 GMDB GMIB Direct Ceded Direct Ceded (in millions) Balance at April 1, 2020 $ 5,047 $ (105) $ 6,297 $ (3,305) Paid guarantee benefits (140) 4 (103) 17 Other changes in reserve 102 3 (43) (145) Balance at June 30, 2020 $ 5,009 $ (98) $ 6,151 $ (3,433) Balance at April 1, 2019 $ 4,665 $ (103) $ 3,740 $ (2,009) Paid guarantee benefits (108) 5 (56) 14 Other changes in reserve 153 (2) 75 (201) Balance at June 30, 2019 $ 4,710 $ (100) $ 3,759 $ (2,196) GMDB GMIB Direct Ceded Direct Ceded (in millions) Balance at January 1, 2020 $ 4,779 $ (98) $ 4,688 $ (2,466) Paid guarantee benefits (251) 9 (177) 37 Other changes in reserve 481 (9) 1,640 (1,004) Balance at June 30, 2020 $ 5,009 $ (98) $ 6,151 $ (3,433) Balance at January 1, 2019 $ 4,654 $ (107) $ 3,741 $ (1,991) Paid guarantee benefits (226) 9 (112) 35 Other changes in reserve 282 (2) 130 (240) Balance at June 30, 2019 $ 4,710 $ (100) $ 3,759 $ (2,196) |
Variable Annuity Contracts with GMDB and GMIB Features | Account Values and Net Amount at Risk (“NAR”) for direct variable annuity contracts in force with GMDB and GMIB features as of June 30, 2020 are presented in the following tables by guarantee type. For contracts with the GMDB feature, the NAR in the event of death is the amount by which the GMDB feature exceeds the related Account Values. For contracts with the GMIB feature, the NAR in the event of annuitization is the amount by which the present value of the GMIB benefits exceed the related Account Values, taking into account the relationship between current annuity purchase rates and the GMIB guaranteed annuity purchase rates. Since variable annuity contracts with GMDB features may also offer GMIB guarantees in the same contract, the GMDB and GMIB amounts listed are not mutually exclusive. Direct Variable Annuity Contracts with GMDB and GMIB Features at June 30, 2020 Guarantee Type Return of Premium Ratchet Roll-Up Combo Total (in millions, except age and interest rate) Variable annuity contracts with GMDB features Account Values invested in: General Account $ 14,904 $ 90 $ 57 $ 174 $ 15,225 Separate Accounts 46,313 8,576 2,914 30,252 88,055 Total Account Values $ 61,217 $ 8,666 $ 2,971 $ 30,426 $ 103,280 Net Amount at Risk, gross $ 167 $ 207 $ 1,990 $ 20,398 $ 22,762 Net Amount at Risk, net of amounts reinsured $ 167 $ 201 $ 1,414 $ 20,398 $ 22,180 Average attained age of policyholders (in years) 51.2 68.0 74.6 69.8 55.1 Percentage of policyholders over age 70 10.9 % 47.1 % 69.3 % 52.4 % 19.8 % Range of contractually specified interest rates N/A N/A 3% - 6% 3% - 6.5% 3% - 6.5% Variable annuity contracts with GMIB features Account Values invested in: General Account $ — $ — $ 18 $ 223 $ 241 Separate Accounts — — 22,463 32,329 54,792 Total Account Values $ — $ — $ 22,481 $ 32,552 $ 55,033 Net Amount at Risk, gross $ — $ — $ 1,189 $ 15,384 $ 16,573 Net Amount at Risk, net of amounts reinsured $ — $ — $ 376 $ 13,872 $ 14,248 Average attained age of policyholders (in years) N/A N/A 63.8 69.8 67.6 Weighted average years remaining until annuitization N/A N/A 5.9 0.7 2.6 Range of contractually specified interest rates N/A N/A 3% - 6% 3% - 6.5% 3% - 6.5% |
Investment in Variable Insurance Trust Mutual Funds | The following table presents the aggregate fair value of assets, by major investment category, held by Separate Accounts that support variable annuity contracts with GMDB and GMIB features. The investment performance of the assets impacts the related Account Values and, consequently, the NAR associated with the GMDB and GMIB benefits and guarantees. Because the Company’s variable annuity contracts offer both GMDB and GMIB features, GMDB and GMIB amounts are not mutually exclusive. Investment in Variable Insurance Trust Mutual Funds June 30, 2020 December 31, 2019 Mutual Fund Type GMDB GMIB GMDB GMIB (in millions) Equity $ 39,126 $ 16,011 $ 42,489 $ 17,941 Fixed income 5,297 2,682 5,263 2,699 Balanced 42,696 35,835 45,871 38,445 Other 936 264 865 263 Total $ 88,055 $ 54,792 $ 94,488 $ 59,348 |
No Lapse Guarantee Liabilities | The change in the NLG liabilities, reflected in Future policy benefits and other policyholders’ liabilities in the consolidated balance sheets, is summarized in the table below. 2020 2019 Direct Liability Reinsurance Ceded Net Direct Liability Reinsurance Ceded Net (in millions) Balance at April 1, $ 920 $ (827) $ 93 $ 801 $ (744) $ 57 Paid guarantee benefits (13) — (13) (3) — (3) Other changes in reserves 35 (14) 21 21 (11) 10 Balance at June 30, $ 942 $ (841) $ 101 $ 819 $ (755) $ 64 Balance at January 1, $ 893 $ (807) $ 86 $ 787 $ (733) $ 54 Paid guarantee benefits (26) — (26) (10) — (10) Other changes in reserves 75 (34) 41 42 (22) 20 Balance at June 30, $ 942 $ (841) $ 101 $ 819 $ (755) $ 64 |
FAIR VALUE DISCLOSURES (Tables)
FAIR VALUE DISCLOSURES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis are summarized below. At June 30, 2020 and December 31, 2019, no assets were required to be measured at fair value on a non-recurring basis. Fair value measurements are required on a non-recurring basis for certain assets, including goodwill and mortgage loans on real estate, only when an impairment or other event occurs. When such fair value measurements are recorded, they must be classified and disclosed within the fair value hierarchy. Fair Value Measurements at June 30, 2020 Level 1 Level 2 Level 3 Total (in millions) Assets: Investments: Fixed maturities, AFS: Corporate (1) $ — $ 47,978 $ 1,652 $ 49,630 U.S. Treasury, government and agency — 17,193 — 17,193 States and political subdivisions — 672 40 712 Foreign governments — 833 — 833 Residential mortgage-backed (2) — 158 — 158 Asset-backed (3) — 2,039 — 2,039 Commercial mortgage-backed — 879 — 879 Redeemable preferred stock 315 63 — 378 Total fixed maturities, AFS 315 69,815 1,692 71,822 Other equity investments 12 — 1 13 Trading securities 282 5,859 — 6,141 Other invested assets: Short-term investments — 227 — 227 Assets of consolidated VIEs/VOEs — — 15 15 Swaps — 1,655 — 1,655 Credit default swaps — 6 — 6 Options — 1,891 — 1,891 Total other invested assets — 3,779 15 3,794 Cash equivalents 3,784 — — 3,784 GMIB reinsurance contracts asset — — 3,433 3,433 Separate Accounts assets (4) 113,420 2,792 — 116,212 Total Assets $ 117,813 $ 82,245 $ 5,141 $ 205,199 Liabilities: GMxB derivative features’ liability $ — $ — $ 12,382 $ 12,382 SCS, SIO, MSO and IUL indexed features’ liability — 1,690 — 1,690 Total Liabilities $ — $ 1,690 $ 12,382 $ 14,072 ______________ (1) Corporate fixed maturities includes both public and private issues. (2) Includes publicly traded agency pass-through securities and collateralized obligations. (3) Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans. (4) Separate Accounts assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate and commercial mortgages. At June 30, 2020 the fair value of such investments was $363 million. Fair Value Measurements at December 31, 2019 Level 1 Level 2 Level 3 Total (in millions) Assets: Investments: Fixed maturities, AFS: Corporate (1) $ — $ 43,218 $ 1,246 $ 44,464 U.S. Treasury, government and agency — 15,231 — 15,231 States and political subdivisions — 610 39 649 Foreign governments — 490 — 490 Residential mortgage-backed (2) — 173 — 173 Asset-backed (3) — 744 100 844 Redeemable preferred stock 237 274 — 511 Total fixed maturities, AFS 237 60,740 1,385 62,362 Other equity investments 13 — — 13 Trading securities 321 6,277 — 6,598 Other invested assets: Short-term investments — 468 — 468 Assets of consolidated VIEs/VOEs — — 16 16 Swaps — (326) — (326) Credit default swaps — 18 — 18 Options — 3,331 — 3,331 Total other invested assets — 3,491 16 3,507 Cash equivalents 1,155 — — 1,155 GMIB reinsurance contracts asset — — 2,466 2,466 Separate Accounts assets (4) 121,184 2,878 — 124,062 Total Assets $ 122,910 $ 73,386 $ 3,867 $ 200,163 Liabilities: GMxB derivative features’ liability $ — $ — $ 8,246 $ 8,246 SCS, SIO, MSO and IUL indexed features’ liability — 3,150 — 3,150 Total Liabilities $ — $ 3,150 $ 8,246 $ 11,396 ______________ (1) Corporate fixed maturities includes both public and private issues. (2) Includes publicly traded agency pass-through securities and collateralized obligations. (3) Includes credit-tranched securities collateralized by sub-prime mortgages and other asset types and credit tenant loans. |
Reconciliation of Assets and Liabilities at Level 3 | The tables below present reconciliations for all Level 3 assets and liabilities for the three and six months ended June 30, 2020 and 2019, respectively. Level 3 Instruments - Fair Value Measurements Corporate State and Political Subdivisions Asset-backed (in millions) Balance, April 1, 2020 $ 1,174 $ 36 $ 40 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 1 — — Investment gains (losses), net (11) — — Subtotal (10) — — Other comprehensive income (loss) 6 5 8 Purchases 284 — (48) Sales (44) (1) — Transfers into Level 3 (1) 219 — — Transfers out of Level 3 (1) 23 — — Balance, June 30, 2020 $ 1,652 $ 40 $ — Balance, April 1, 2019 $ 1,169 $ 39 $ 534 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 2 — — Investment gains (losses), net — — — Subtotal 2 — — Other comprehensive income (loss) 1 1 1 Purchases 151 — (1) Sales (26) (1) — Transfers into Level 3 (1) (3) — — Transfers out of Level 3 (1) (4) — — Balance, June 30, 2019 $ 1,290 $ 39 $ 534 ______________ (1) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. Corporate State and Political Subdivisions Asset-backed (in millions) Balance, January 1, 2020 $ 1,246 $ 39 $ 100 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 2 — — Investment gains (losses), net (13) — — Subtotal (11) — — Corporate State and Political Subdivisions Asset-backed (in millions) Other comprehensive income (loss) (54) 2 — Purchases 345 — — Sales (90) (1) — Transfers into Level 3 (1) 219 — — Transfers out of Level 3 (1) (3) — (100) Balance, June 30, 2020 $ 1,652 $ 40 $ — Balance, January 1, 2019 $ 1,174 $ 38 $ 519 Total gains and (losses), realized and unrealized, included in: Net income (loss) as: Net investment income (loss) 3 — — Investment gains (losses), net — — — Subtotal 3 — — Other comprehensive income (loss) 10 2 5 Purchases 221 — 10 Sales (59) (1) — Transfers into Level 3 (1) 14 — — Transfers out of Level 3 (1) (73) — — Balance, June 30, 2019 $ 1,290 $ 39 $ 534 ______________ (1) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. Other Equity Investments GMIB Reinsurance Contract Asset Separate Accounts Assets GMxB Derivative Features Liability (in millions) Balance, April 1, 2020 $ 15 $ 3,305 $ — $ (9,509) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — (139) — (370) Non-performance risk (1) — 272 — (2,411) Total realized and unrealized gains (losses) — 133 — (2,781) Other comprehensive income (loss) — — — — Purchases (2) 1 12 — (107) Sales (3) — (17) — 15 Settlements — — — — Change in estimate (4) — — — — Activity related to consolidated VIEs/VOEs — — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) — — — — Balance, June 30, 2020 $ 16 $ 3,433 $ — $ (12,382) Balance, April 1, 2019 $ 18 $ 2,009 $ 23 $ (5,944) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — 178 — (707) Non-performance risk (1) — 12 — — Total realized and unrealized gains (losses) — 190 — (707) Other comprehensive income (loss) — — — — Purchases (2) — 11 3 (103) Sales (3) — (14) — 5 Settlements — — (2) — Activity related to consolidated VIEs/VOEs (2) — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) — — — — Balance, June 30, 2019 $ 16 $ 2,196 $ 24 $ (6,749) ______________ (1) The Company’s non-performance risk is recorded through Net derivative gains (losses). (2) For the GMIB reinsurance contract asset and GMxB derivative features liability, represents attributed fee. (3) For the GMIB reinsurance contract asset, represents recoveries from reinsurers and for GMxB derivative features liability, represents benefits paid. (4) For the GMIB reinsurance contract asset, represents a transfer from amounts due from reinsurers. (5) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. Other Equity Investments GMIB Reinsurance Contract Asset Separate Accounts Assets GMxB Derivative Features Liability (in millions) Balance, January 1, 2020 $ 16 $ 2,466 $ — $ (8,246) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — 1,082 — (4,440) Non-performance risk (1) — (56) — 494 Total realized and unrealized gains (losses) — 1,026 — (3,946) Other comprehensive income (loss) — Purchases (2) 1 23 — (215) Sales (3) — (37) — 25 Settlements — — — — Change in estimate (4) — (45) — — Activity related to consolidated VIEs/VOEs (1) — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) — — — — Balance, June 30, 2020 $ 16 $ 3,433 $ — $ (12,382) Balance, January 1, 2019 $ 48 $ 1,991 $ 21 $ (5,431) Realized and unrealized gains (losses), included in Net income (loss) as: Investment gains (losses), net — — — — Net derivative gains (losses), excluding non-performance risk — 165 — (656) Non-performance risk (1) — 52 — (460) Total realized and unrealized gains (losses) — 217 — (1,116) Other comprehensive income (loss) — — — — Purchases (2) — 23 8 (210) Sales (3) — (35) — 8 Settlements — — (3) — Activity related to consolidated VIEs/VOEs (3) — — — Transfers into Level 3 (5) — — — — Transfers out of Level 3 (5) (29) — (1) — Balance, June 30, 2019 $ 16 $ 2,196 $ 25 $ (6,749) ______________ (1) The Company’s non-performance risk is recorded through Net derivative gains (losses). (2) For the GMIB reinsurance contract asset and GMxB derivative features liability, represents attributed fee. (3) For the GMIB reinsurance contract asset, represents recoveries from reinsurers and for GMxB derivative features liability, represents benefits paid. (4) For the GMIB reinsurance contract asset, represents a transfer from amounts due from reinsurers. (5) Transfers into/out of the Level 3 classification are reflected at beginning-of-period fair values. The table below details changes in unrealized gains (losses) for the six months ended June 30, 2020 and 2019 by category for Level 3 assets and liabilities still held at June 30, 2020 and 2019, respectively. Change in Unrealized Gains (Losses) for Level 3 Instruments Net Income (Loss) Net Derivative Gains (Losses) OCI (in millions) Held at June 30, 2020: Change in unrealized gains (losses): Fixed maturities, AFS: Corporate $ — $ (54) State and political subdivisions — 2 Total fixed maturities, AFS — (52) GMIB reinsurance contracts 1,026 — GMxB derivative features liability (3,946) — Total $ (2,920) $ (52) Held at June 30, 2019: Change in unrealized gains (losses): Fixed maturities, AFS: Corporate $ — $ 10 State and political subdivisions — 2 Asset-backed — 5 Total fixed maturities, AFS — 17 GMIB reinsurance contracts 217 — GMxB derivative features liability (1,116) — Total $ (899) $ 17 |
Quantitative Information About Level 3 Fair Value Measurement | The following tables disclose quantitative information about Level 3 fair value measurements by category for assets and liabilities at June 30, 2020 and December 31, 2019, respectively. Quantitative Information about Level 3 Fair Value Measurements at June 30, 2020 Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average (2) (in millions) Assets: Investments: Fixed maturities, AFS: Corporate $ 237 Matrix pricing Spread over Benchmark 0 - 580 bps 34 bps 1,062 Market EBITDA multiples 3.7x - 33.6x 14.0x GMIB reinsurance contract asset 3,433 Discounted cash flow Non-performance risk 55 - 144 bps 73 bps Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average (2) (in millions) Liabilities: GMIBNLG 12,081 Discounted cash flow Non-performance risk 166.0 bps GWBL/GMWB 167 Discounted cash flow Non-performance risk 166.0 bps GIB 124 Discounted cash flow Non-performance risk 166.0 bps GMAB 10 Discounted cash flow Non-performance risk 166.0 bps ______________ (1) Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives. (2) For Lapses, Withdrawals, and Utilizations the rates were weighted by counts, for Mortality weighted average rates are shown for all ages combined and for Withdrawals the weighted averages were based on an estimated split of partial withdrawal and dollar-for-dollar withdrawals. Quantitative Information about Level 3 Fair Value Measurements at December 31, 2019 Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average (in millions) Assets: Investments: Fixed maturities, AFS: Corporate $ 51 Matrix pricing model Spread over benchmark 65 - 580 bps 186 bps 1,025 Market comparable companies EBITDA multiples 3.3x - 56.7x 14.3x GMIB reinsurance contract asset 2,466 Discounted cash flow Non-performance risk 55 - 109 bps Liabilities: GMIBNLG 8,128 Discounted cash flow Non-performance risk 124 bps GWBL/GMWB 109 Discounted cash flow Non-performance risk 124 bps GIB 5 Discounted cash flow Non-performance risk 124 bps GMAB 4 Discounted cash flow Lapse rates 1.0% - 10.0% ______________ (1) Mortality rates vary by age and demographic characteristic such as gender. Mortality rate assumptions are based on a combination of company and industry experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuating the embedded derivatives. |
Fair Value Disclosure Financial Instruments Not Carried At Fair Value | The carrying values and fair values at June 30, 2020 and December 31, 2019 for financial instruments not otherwise disclosed in Note 3 and Note 4 are presented in the table below. Carrying Values and Fair Values for Financial Instruments Not Otherwise Disclosed Carrying Value Fair Value Level 1 Level 2 Level 3 Total (in millions) June 30, 2020: Mortgage loans on real estate $ 12,506 $ — $ — $ 12,572 $ 12,572 Policy loans $ 3,225 $ — $ — $ 4,390 $ 4,390 Loans to affiliates $ 1,200 $ — $ 1,245 $ — $ 1,245 Policyholders’ liabilities: Investment contracts $ 2,047 $ — $ — $ 2,293 $ 2,293 FHLBNY funding agreements (1) $ 6,700 $ — $ 6,793 $ — $ 6,793 Separate Accounts liabilities $ 8,445 $ — $ — $ 8,445 $ 8,445 December 31, 2019: Mortgage loans on real estate $ 12,090 $ — $ — $ 12,317 $ 12,317 Policy loans $ 3,270 $ — $ — $ 4,199 $ 4,199 Loans to affiliates $ 1,200 $ — $ 1,224 $ — $ 1,224 Policyholders’ liabilities: Investment contracts $ 1,922 $ — $ — $ 2,029 $ 2,029 FHLBNY funding agreements (1) $ 6,909 $ — $ 6,957 $ — $ 6,957 Separate Accounts liabilities $ 9,041 $ — $ — $ 9,041 $ 9,041 ______________ (1) Federal Home Loan Bank of New York (“FHLBNY”) |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | AOCI represents cumulative gains (losses) on items that are not reflected in Net income (loss). The balances as of June 30, 2020 and 2019 follow: June 30, 2020 2019 (in millions) Unrealized gains (losses) on investments $ 4,680 $ 1,571 Defined benefit pension plans (4) (7) Accumulated other comprehensive income (loss) attributable to Equitable Financial $ 4,676 $ 1,564 |
Comprehensive Income (Loss) | The components of OCI, net of taxes for the three and six months ended June 30, 2020 and 2019, follow: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Change in net unrealized gains (losses) on investments: Net unrealized gains (losses) arising during the period $ 2,633 $ 1,283 $ 4,229 $ 2,526 (Gains) losses reclassified into net income (loss) during the period (1) (134) (4) (182) 2 Net unrealized gains (losses) on investments 2,499 1,279 4,047 2,528 Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other (930) 12 (964) (473) Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $417, $341, $820 and $541) 1,569 1,291 3,083 2,055 Other comprehensive income (loss), attributable to Equitable Financial $ 1,570 $ 1,291 $ 3,084 $ 2,055 ____________ (1) See “Reclassification adjustments” in Note 3. Reclassification amounts presented net of income tax expense (benefit) of $(35) million, $0 million, $(48) million and $1 million for the three and six months ended June 30, 2020 and 2019, respectively. |
REDEEMABLE NONCONTROLLING INT_2
REDEEMABLE NONCONTROLLING INTEREST (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | The changes in the components of redeemable noncontrolling interests are presented in the table that follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (in millions) Balance, beginning of period $ 32 $ 48 $ 39 $ 39 Net earnings (loss) attributable to redeemable noncontrolling interests 2 1 (3) 3 Purchase/change of redeemable noncontrolling interests 2 (7) — — Balance, end of period $ 36 $ 42 $ 36 $ 42 |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Activity of Funding Agreements with FHLBNY | Change in FHLBNY Funding Agreements during the Six Months Ended June 30, 2020 Outstanding Balance at December 31, 2019 Issued During the Period Repaid During the Period Long-term Agreements Maturing Within One Year Long-term Agreements Maturing Within Five Year Outstanding Balance at June 30, 2020 (in millions) Short-term funding agreements: Due in one year or less $ 4,608 $ 22,950 $ 23,158 $ 490 $ — $ 4,890 Long-term funding agreements: Due in years two through five 1,646 — — (490) 112 1,268 Due in more than five years 646 — — — (112) 534 Total long-term funding agreements 2,292 — — (490) — 1,802 Total funding agreements (1) $ 6,900 $ 22,950 $ 23,158 $ — $ — $ 6,692 ____________ (1) The $8 million and $9 million difference between the funding agreements carrying value shown in fair value table for June 30, 2020 and December 31, 2019, respectively, reflects the remaining amortization of a hedge implemented and closed, which locked in the funding agreements borrowing rates. |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - New Accounting Pronouncements (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Mar. 31, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Stockholders' equity | $ 15,166 | $ 18,881 | $ 11,658 | $ 13,932 | $ 12,370 | $ 12,428 | |
Retained Earnings | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Stockholders' equity | $ 2,658 | $ 7,953 | 2,242 | $ 4,532 | $ 4,268 | $ 5,098 | |
Cumulative effect of period of adoption, adjusted balance | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Stockholders' equity | (32) | ||||||
Cumulative effect of period of adoption, adjusted balance | Retained Earnings | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Stockholders' equity | $ (32) | ||||||
Accounting Standards Update 2016-13 | Cumulative effect of period of adoption, adjusted balance | Retained Earnings | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Stockholders' equity | $ (40) |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES - Investments and Commercial and Agricultural Mortgage Loans on Real Estate (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Mortgage Loans on Real Estate, Write-down or Reserve, Management Judgment Factor [Line Items] | ||
Carrying value of COLI | $ 947 | $ 942 |
Real estate held for the production of income | Minimum | ||
Mortgage Loans on Real Estate, Write-down or Reserve, Management Judgment Factor [Line Items] | ||
Real estate held for the production of income, useful lives | 40 years | |
Real estate held for the production of income | Maximum | ||
Mortgage Loans on Real Estate, Write-down or Reserve, Management Judgment Factor [Line Items] | ||
Real estate held for the production of income, useful lives | 50 years |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES - Accounting and Consolidation of Variable Interest Entities (VIEs) (Details) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020USD ($)joint_venture | Dec. 31, 2019USD ($)joint_venture | |
Variable Interest Entity [Line Items] | ||
Assets | $ 232,378 | $ 228,041 |
Consolidated Variable Interest Entities | ||
Variable Interest Entity [Line Items] | ||
Number of consolidated real estate joint ventures | joint_venture | 1 | 1 |
Assets | $ 30 | $ 32 |
Non-consolidated Vairable Interest Entities | ||
Variable Interest Entity [Line Items] | ||
Assets | 146,600 | 160,200 |
Investment assets | 1,100 | 1,100 |
Variable interest, maximum loss exposure | 1,100 | 1,100 |
Unfunded commitments | 1,200 | 1,100 |
Operating income (loss) | $ (5) | $ (5) |
Number of non-consolidated real estate joint ventures | joint_venture | 1 | 1 |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES - Assumption Updates and Model Changes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2020 | |
Change in Accounting Estimate [Line Items] | |||||
Policyholders’ benefits increase (decrease) | $ 700,000,000 | $ 868,000,000 | $ 3,297,000,000 | $ 1,687,000,000 | |
Policy charges and fee income | 825,000,000 | 865,000,000 | 1,729,000,000 | 1,724,000,000 | |
Interest credited to policyholder's account balances | (279,000,000) | (288,000,000) | (568,000,000) | (557,000,000) | |
Income (loss) from operations, before income taxes | (5,120,000,000) | 318,000,000 | 2,070,000,000 | (672,000,000) | |
Net income (loss) | $ (4,091,000,000) | $ 265,000,000 | 1,645,000,000 | $ (563,000,000) | |
Long-term Lapses Partial Withdrawal Rates And Election Assumptions Updates | |||||
Change in Accounting Estimate [Line Items] | |||||
Policyholders’ benefits increase (decrease) | 1,300,000,000 | ||||
Amortization of deferred policy acquisition costs, net | 861,000,000 | ||||
Policy charges and fee income | 54,000,000 | ||||
Interest credited to policyholder's account balances | 6,000,000 | ||||
Income (loss) from operations, before income taxes | (2,100,000,000) | ||||
Net income (loss) | (1,700,000,000) | ||||
Economic Scenario Generator | |||||
Change in Accounting Estimate [Line Items] | |||||
Income (loss) from operations, before income taxes | 165,000,000 | ||||
Net income (loss) | $ 130,000,000 | ||||
5-year Historical Average Over A 10-year Period | |||||
Change in Accounting Estimate [Line Items] | |||||
Interest rate assumptions | $ 0.0225 |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020USD ($)security | Jun. 30, 2020USD ($)numberOfTroubledDebtRestructuringsecurity | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($)security | |
Net Investment Income [Line Items] | ||||
Number of unrealized loss positions | security | 639 | 639 | 390 | |
Debt securities exposure in single issuer greater than stated percentage of total investments | 0.60% | 0.60% | ||
Amortized cost | $ 63,602,000,000 | $ 63,602,000,000 | ||
Unrealized loss on available for sale securities | 112,000,000 | 112,000,000 | $ 21,000,000 | |
12 months or longer, gross unrealized losses | 57,000,000 | 57,000,000 | 32,000,000 | |
Allowance for credit loss | $ 66,000,000 | $ 66,000,000 | ||
Number of troubled debt restructuring | numberOfTroubledDebtRestructuring | 4 | |||
Troubled debt restructuring, premodification | $ 42,000,000 | |||
Troubled debt restructuring, postmodification | $ 37,000,000 | |||
Troubled debt restructuring, percentage of total invested assets | 0.04% | 0.04% | ||
Separate account equity investment carrying value | $ 38,000,000 | $ 38,000,000 | 58,000,000 | |
Corporate | ||||
Net Investment Income [Line Items] | ||||
Debt securities exposure in single issuer of total investments | $ 318,000,000 | $ 318,000,000 | $ 279,000,000 | |
Debt securities exposure in single issuer of total investments, percent | 2.10% | 2.10% | 2.40% | |
12 months or longer, gross unrealized losses | $ 51,000,000 | $ 51,000,000 | $ 20,000,000 | |
Fixed maturities | ||||
Net Investment Income [Line Items] | ||||
Accrued investment income receivable | 480,000,000 | 480,000,000 | ||
Accrued interest, written off | 0 | 0 | ||
Amortized cost | 63,615,000,000 | 63,615,000,000 | 59,278,000,000 | |
Commercial Real Estate and Agricultural Real Estate Portfolio Segment | ||||
Net Investment Income [Line Items] | ||||
Accrued investment income receivable | 28,000,000 | 28,000,000 | 29,000,000 | |
Commercial Mortgage Loans | ||||
Net Investment Income [Line Items] | ||||
Accrued interest, written off | 1,000,000 | 1,000,000 | ||
Allowance for credit loss | 62,000,000 | 62,000,000 | $ 43,000,000 | 33,000,000 |
Recorded investment, nonaccrual status | 75,000,000 | 75,000,000 | 0 | |
Agricultural Mortgage Loans | ||||
Net Investment Income [Line Items] | ||||
Accrued interest, written off | 0 | 0 | ||
Individually Assessed Mortgage Loans | ||||
Net Investment Income [Line Items] | ||||
Mortgage loans foreclosure probable | 0 | 0 | ||
Allowance for credit loss | 0 | 0 | ||
Fair Value, Recurring | ||||
Net Investment Income [Line Items] | ||||
Trading securities, at fair value | 6,141,000,000 | 6,141,000,000 | 6,598,000,000 | |
Other Than Investment Grade | External Credit Rating, Non Investment Grade | Fixed maturities | ||||
Net Investment Income [Line Items] | ||||
Available-for-sale securities, amortized cost | $ 1,900,000,000 | $ 1,900,000,000 | $ 1,400,000,000 | |
Percentage of available for sale securities | 3.00% | 3.00% | 2.30% |
INVESTMENTS - Available-for-sal
INVESTMENTS - Available-for-sale Securities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | $ 63,615 | $ 63,615 | $ 59,278 | ||
Allowance for Credit Losses | 13 | 13 | 0 | ||
Gross Unrealized Gains | 8,431 | 8,431 | 3,465 | ||
Gross Unrealized Losses | 211 | 211 | 381 | ||
Fair Value | 71,822 | 71,822 | 62,362 | ||
Amortized Cost | |||||
Due in one year or less, Amortized Cost | 4,393 | 4,393 | |||
Due in years two through five, Amortized Cost | 14,167 | 14,167 | |||
Due in years six through ten, Amortized Cost | 16,475 | 16,475 | |||
Due after ten years, Amortized Cost | 25,138 | 25,138 | |||
Subtotal | 60,173 | 60,173 | |||
Amortized cost | 63,602 | 63,602 | |||
Fair Value | |||||
Due in one year or less, Fair Value | 4,433 | 4,433 | |||
Due in years two through five, Fair Value | 14,944 | 14,944 | |||
Due in years six through ten, Fair Value | 18,256 | 18,256 | |||
Due after ten years, Fair Value | 30,735 | 30,735 | |||
Subtotal | 68,368 | 68,368 | |||
Fair Value | 71,822 | 71,822 | |||
Available For Sale Fixed Maturities Proceeds Gross Gains And Gross Losses From Sales And Other Than Temporary Impairments [Abstract] | |||||
Proceeds from sales | 2,864 | $ 1,556 | 4,586 | $ 2,917 | |
Gross gains on sales | 205 | 9 | 274 | 17 | |
Gross losses on sales | (24) | (6) | (27) | (21) | |
Credit losses | (11) | 0 | (13) | 0 | |
Fixed Maturities - Credit Loss Impairments | |||||
Balances, beginning of period | (17) | (18) | (15) | (46) | |
Previously recognized impairments on securities that matured, paid, prepaid or sold | 0 | 0 | 0 | 28 | |
Recognized impairments on securities impaired to fair value this period | 0 | 0 | 0 | 0 | |
Credit losses recognized this period on securities for which credit losses were not previously recognized | (8) | 0 | (10) | 0 | |
Additional impairments this period on securities previously impaired | (3) | 0 | (3) | 0 | |
Increases due to passage of time on previously recorded credit losses | 0 | 0 | 0 | 0 | |
Accretion of previously recognized impairments due to increases in expected cash flows | 0 | 0 | 0 | 0 | |
Balances, end of period | (28) | $ (18) | (28) | $ (18) | |
Corporate | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 45,706 | 45,706 | 42,347 | ||
Allowance for Credit Losses | 13 | 13 | 0 | ||
Gross Unrealized Gains | 4,091 | 4,091 | 2,178 | ||
Gross Unrealized Losses | 154 | 154 | 61 | ||
Fair Value | 49,630 | 49,630 | 44,464 | ||
U.S. Treasury, government and agency | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 13,103 | 13,103 | 14,385 | ||
Allowance for Credit Losses | 0 | 0 | 0 | ||
Gross Unrealized Gains | 4,090 | 4,090 | 1,151 | ||
Gross Unrealized Losses | 0 | 0 | 305 | ||
Fair Value | 17,193 | 17,193 | 15,231 | ||
States and political subdivisions | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 607 | 607 | 584 | ||
Allowance for Credit Losses | 0 | 0 | 0 | ||
Gross Unrealized Gains | 105 | 105 | 68 | ||
Gross Unrealized Losses | 0 | 0 | 3 | ||
Fair Value | 712 | 712 | 649 | ||
Foreign governments | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 770 | 770 | 460 | ||
Allowance for Credit Losses | 0 | 0 | 0 | ||
Gross Unrealized Gains | 69 | 69 | 35 | ||
Gross Unrealized Losses | 6 | 6 | 5 | ||
Fair Value | 833 | 833 | 490 | ||
Residential mortgage-backed | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 144 | 144 | 161 | ||
Allowance for Credit Losses | 0 | 0 | 0 | ||
Gross Unrealized Gains | 14 | 14 | 12 | ||
Gross Unrealized Losses | 0 | 0 | 0 | ||
Fair Value | 158 | 158 | 173 | ||
Amortized Cost | |||||
Amortized Cost Basis, without Single Maturity Date | 144 | 144 | |||
Fair Value | |||||
Without single maturity date | 158 | 158 | |||
Asset-backed | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 2,057 | 2,057 | 843 | ||
Allowance for Credit Losses | 0 | 0 | 0 | ||
Gross Unrealized Gains | 23 | 23 | 3 | ||
Gross Unrealized Losses | 41 | 41 | 2 | ||
Fair Value | 2,039 | 2,039 | 844 | ||
Amortized Cost | |||||
Amortized Cost Basis, without Single Maturity Date | 2,057 | 2,057 | |||
Fair Value | |||||
Without single maturity date | 2,039 | 2,039 | |||
Commercial mortgage-backed | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 855 | 855 | |||
Allowance for Credit Losses | 0 | 0 | |||
Gross Unrealized Gains | 24 | 24 | |||
Gross Unrealized Losses | 0 | 0 | |||
Fair Value | 879 | 879 | |||
Amortized Cost | |||||
Amortized Cost Basis, without Single Maturity Date | 855 | 855 | |||
Fair Value | |||||
Without single maturity date | 879 | 879 | |||
Redeemable preferred stock | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Amortized Cost | 373 | 373 | 498 | ||
Allowance for Credit Losses | 0 | 0 | 0 | ||
Gross Unrealized Gains | 15 | 15 | 18 | ||
Gross Unrealized Losses | 10 | 10 | 5 | ||
Fair Value | 378 | 378 | $ 511 | ||
Amortized Cost | |||||
Amortized Cost Basis, without Single Maturity Date | 373 | 373 | |||
Fair Value | |||||
Without single maturity date | $ 378 | $ 378 |
INVESTMENTS - Rollforward of Ne
INVESTMENTS - Rollforward of Net Unrealized Investment Gains (Losses) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 18,881 | $ 12,370 | $ 11,658 | $ 12,428 |
Deferred income taxes | (417) | (341) | (820) | (541) |
Ending balance | 15,166 | 13,932 | 15,166 | 13,932 |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | All other | Net Unrealized Gains (Losses) on Investments | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 5,040 | 1,003 | 3,084 | (577) |
Net investment gains (losses) arising during the period | 3,336 | 1,623 | 5,362 | 3,206 |
Included in Net income (loss) | (167) | (4) | (230) | (7) |
Excluded from Net income (loss) | 0 | 0 | 0 | 0 |
Net unrealized investment gains (losses) excluding OTTI losses | 8,209 | 2,622 | 8,216 | 2,622 |
Net unrealized investment gains (losses) with OTTI losses | (2) | 2 | (9) | 2 |
Ending balance | 8,207 | 2,624 | 8,207 | 2,624 |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | All other | DAC | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (205) | (616) | (831) | 39 |
DAC | (289) | 82 | 336 | (573) |
Net unrealized investment gains (losses) excluding OTTI losses | (494) | (534) | (495) | (534) |
Ending balance | (494) | (534) | (494) | (534) |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | All other | Policyholders’ Liabilities | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (1,003) | 22 | (192) | (55) |
Policyholders’ liabilities | (799) | (108) | (1,611) | (31) |
Net unrealized investment gains (losses) excluding OTTI losses | (1,802) | (86) | (1,803) | (86) |
Ending balance | (1,801) | (86) | (1,801) | (86) |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | All other | Deferred Income Tax Asset (Liability) | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (805) | (86) | (433) | 125 |
Deferred income taxes | (437) | (334) | (810) | (545) |
Net unrealized investment gains (losses) excluding OTTI losses | (1,242) | (420) | (1,243) | (420) |
Ending balance | (1,242) | (420) | (1,242) | (420) |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | All other | AOCI Gain (Loss) Related to Net Unrealized Investment Gains (Losses) | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 3,027 | 323 | 1,628 | (468) |
Net investment gains (losses) arising during the period | 3,336 | 1,623 | 5,362 | 3,206 |
Included in Net income (loss) | (167) | (4) | (230) | (7) |
Excluded from Net income (loss) | 0 | 0 | 0 | 0 |
DAC | (289) | 82 | 336 | (573) |
Deferred income taxes | (437) | (334) | (810) | (545) |
Policyholders’ liabilities | (799) | (108) | (1,611) | (31) |
Net unrealized investment gains (losses) excluding OTTI losses | 4,671 | 1,582 | 4,675 | 1,582 |
Net unrealized investment gains (losses) with OTTI losses | (1) | 2 | (5) | 2 |
Ending balance | 4,670 | 1,584 | 4,670 | 1,584 |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | Fixed Maturities | All other | DAC | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Net unrealized investment gains (losses) with OTTI losses | 0 | 0 | 1 | 0 |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | Fixed Maturities | All other | Policyholders’ Liabilities | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Net unrealized investment gains (losses) with OTTI losses | 1 | 0 | 2 | 0 |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | Fixed Maturities | All other | Deferred Income Tax Asset (Liability) | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Net unrealized investment gains (losses) with OTTI losses | $ 0 | $ 0 | $ 1 | $ 0 |
INVESTMENTS - Fixed Maturities
INVESTMENTS - Fixed Maturities Available-for-sale (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | $ 4,028 | $ 7,396 |
Less than 12 months, gross unrealized losses | 147 | 349 |
12 months or longer, fair value | 357 | 665 |
12 months or longer, gross unrealized losses | 57 | 32 |
Fair value | 4,385 | 8,061 |
Gross unrealized losses | 204 | 381 |
Corporate | ||
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 2,511 | 2,669 |
Less than 12 months, gross unrealized losses | 96 | 41 |
12 months or longer, fair value | 273 | 366 |
12 months or longer, gross unrealized losses | 51 | 20 |
Fair value | 2,784 | 3,035 |
Gross unrealized losses | 147 | 61 |
U.S. Treasury, government and agency | ||
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 4,245 | |
Less than 12 months, gross unrealized losses | 305 | |
12 months or longer, fair value | 2 | |
12 months or longer, gross unrealized losses | 0 | |
Fair value | 4,247 | |
Gross unrealized losses | 305 | |
States and political subdivisions | ||
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 123 | |
Less than 12 months, gross unrealized losses | 3 | |
12 months or longer, fair value | 0 | |
12 months or longer, gross unrealized losses | 0 | |
Fair value | 123 | |
Gross unrealized losses | 3 | |
Foreign governments | ||
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 47 | 11 |
Less than 12 months, gross unrealized losses | 6 | 0 |
12 months or longer, fair value | 0 | 47 |
12 months or longer, gross unrealized losses | 0 | 5 |
Fair value | 47 | 58 |
Gross unrealized losses | 6 | 5 |
Asset-backed | ||
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 1,349 | 319 |
Less than 12 months, gross unrealized losses | 37 | 0 |
12 months or longer, fair value | 73 | 201 |
12 months or longer, gross unrealized losses | 4 | 2 |
Fair value | 1,422 | 520 |
Gross unrealized losses | 41 | 2 |
Redeemable preferred stock | ||
Available For Sale Securities Continuous Unrealized Loss Position [Line Items] | ||
Less than 12 months, fair value | 121 | 29 |
Less than 12 months, gross unrealized losses | 8 | 0 |
12 months or longer, fair value | 11 | 49 |
12 months or longer, gross unrealized losses | 2 | 5 |
Fair value | 132 | 78 |
Gross unrealized losses | $ 10 | $ 5 |
INVESTMENTS - Mortgage Loans (D
INVESTMENTS - Mortgage Loans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Ending balance | $ (66) | $ (66) |
Commercial Mortgage Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | (43) | (33) |
Current-period provision for expected credit losses | (19) | (29) |
Write-offs charged against the allowance | 0 | 0 |
Recoveries of amounts previously written off | 0 | 0 |
Net change in allowance | (19) | (29) |
Ending balance | (62) | (62) |
Agricultural Mortgage Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | (3) | (3) |
Current-period provision for expected credit losses | (1) | (1) |
Write-offs charged against the allowance | 0 | 0 |
Recoveries of amounts previously written off | 0 | 0 |
Net change in allowance | (1) | (1) |
Ending balance | $ (4) | $ (4) |
INVESTMENTS - Credit Quality (D
INVESTMENTS - Credit Quality (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Dec. 31, 2019 | |
Commercial Mortgage Loans | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | $ 746 | |
2019 | 797 | |
2018 | 1,248 | |
2017 | 1,201 | |
2016 | 2,755 | |
Prior | 3,082 | |
Total | 9,829 | $ 9,373 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 0 | 0 |
Current | 9,754 | 9,373 |
Total | 9,754 | 9,373 |
Recorded investment, nonaccrual status | 75 | 0 |
Total | 9,829 | 9,373 |
Non-accruing Loans with No allowance | 75 | 0 |
Interest Income on Non-accruing Loans | 1 | 0 |
Commercial Mortgage Loans | 30-59 Days | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 0 | 0 |
Commercial Mortgage Loans | 60-89 Days | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 0 | 0 |
Commercial Mortgage Loans | 90 Days Or Greater | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 0 | 0 |
Commercial Mortgage Loans | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 621 | |
2019 | 373 | |
2018 | 800 | |
2017 | 377 | |
2016 | 2,134 | |
Prior | 1,315 | |
Total | 5,620 | 5,235 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 5,620 | 5,235 |
Commercial Mortgage Loans | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 90 | |
2019 | 187 | |
2018 | 123 | |
2017 | 409 | |
2016 | 70 | |
Prior | 484 | |
Total | 1,363 | 1,331 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,363 | 1,331 |
Commercial Mortgage Loans | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 35 | |
2019 | 183 | |
2018 | 230 | |
2017 | 302 | |
2016 | 551 | |
Prior | 610 | |
Total | 1,911 | 1,546 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,911 | 1,546 |
Commercial Mortgage Loans | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 12 | |
2018 | 12 | |
2017 | 76 | |
2016 | 0 | |
Prior | 673 | |
Total | 773 | 973 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 773 | 973 |
Commercial Mortgage Loans | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 42 | |
2018 | 83 | |
2017 | 37 | |
2016 | 0 | |
Prior | 0 | |
Total | 162 | 288 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 162 | 288 |
Commercial Mortgage Loans | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 0 | |
2018 | 0 | |
2017 | 0 | |
2016 | 0 | |
Prior | 0 | |
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 0% - 50% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 0 | |
2018 | 29 | |
2017 | 324 | |
2016 | 196 | |
Prior | 748 | |
Total | 1,297 | 1,163 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,297 | 1,163 |
Commercial Mortgage Loans | 0% - 50% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 1,016 | 887 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,016 | 887 |
Commercial Mortgage Loans | 0% - 50% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 20 | 38 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 20 | 38 |
Commercial Mortgage Loans | 0% - 50% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 237 | 214 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 237 | 214 |
Commercial Mortgage Loans | 0% - 50% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 24 | 24 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 24 | 24 |
Commercial Mortgage Loans | 0% - 50% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 0% - 50% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 50% - 70% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 656 | |
2019 | 613 | |
2018 | 915 | |
2017 | 759 | |
2016 | 2,501 | |
Prior | 1,714 | |
Total | 7,158 | 7,447 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 7,158 | 7,447 |
Commercial Mortgage Loans | 50% - 70% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 4,208 | 4,097 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 4,208 | 4,097 |
Commercial Mortgage Loans | 50% - 70% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 1,080 | 1,195 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,080 | 1,195 |
Commercial Mortgage Loans | 50% - 70% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 1,353 | 1,118 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,353 | 1,118 |
Commercial Mortgage Loans | 50% - 70% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 485 | 795 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 485 | 795 |
Commercial Mortgage Loans | 50% - 70% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 32 | 242 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 32 | 242 |
Commercial Mortgage Loans | 50% - 70% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 70% - 90% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 90 | |
2019 | 184 | |
2018 | 304 | |
2017 | 113 | |
2016 | 58 | |
Prior | 464 | |
Total | 1,213 | 763 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,213 | 763 |
Commercial Mortgage Loans | 70% - 90% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 312 | 251 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 312 | 251 |
Commercial Mortgage Loans | 70% - 90% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 263 | 98 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 263 | 98 |
Commercial Mortgage Loans | 70% - 90% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 321 | 214 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 321 | 214 |
Commercial Mortgage Loans | 70% - 90% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 187 | 154 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 187 | 154 |
Commercial Mortgage Loans | 70% - 90% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 130 | 46 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 130 | 46 |
Commercial Mortgage Loans | 70% - 90% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 90% plus | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 0 | |
2018 | 0 | |
2017 | 5 | |
2016 | 0 | |
Prior | 156 | |
Total | 161 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 161 | 0 |
Commercial Mortgage Loans | 90% plus | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 84 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 84 | 0 |
Commercial Mortgage Loans | 90% plus | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 90% plus | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 90% plus | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 77 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 77 | 0 |
Commercial Mortgage Loans | 90% plus | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Commercial Mortgage Loans | 90% plus | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 310 | |
2019 | 278 | |
2018 | 348 | |
2017 | 279 | |
2016 | 383 | |
Prior | 1,145 | |
Total | 2,743 | 2,717 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 125 | 124 |
Current | 2,618 | 2,593 |
Total | 2,743 | 2,717 |
Recorded investment, nonaccrual status | 0 | 0 |
Total | 2,743 | 2,717 |
Non-accruing Loans with No allowance | 0 | 0 |
Interest Income on Non-accruing Loans | 0 | 0 |
Agricultural Mortgage Loans | 30-59 Days | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 67 | 57 |
Agricultural Mortgage Loans | 60-89 Days | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 9 | 1 |
Agricultural Mortgage Loans | 90 Days Or Greater | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 49 | 66 |
Agricultural Mortgage Loans | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 43 | |
2019 | 28 | |
2018 | 39 | |
2017 | 37 | |
2016 | 76 | |
Prior | 162 | |
Total | 385 | 404 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 385 | 404 |
Agricultural Mortgage Loans | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 11 | |
2019 | 36 | |
2018 | 15 | |
2017 | 17 | |
2016 | 21 | |
Prior | 91 | |
Total | 191 | 191 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 191 | 191 |
Agricultural Mortgage Loans | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 75 | |
2019 | 39 | |
2018 | 46 | |
2017 | 43 | |
2016 | 52 | |
Prior | 232 | |
Total | 487 | 477 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 487 | 477 |
Agricultural Mortgage Loans | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 110 | |
2019 | 126 | |
2018 | 148 | |
2017 | 110 | |
2016 | 158 | |
Prior | 349 | |
Total | 1,001 | 990 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,001 | 990 |
Agricultural Mortgage Loans | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 67 | |
2019 | 39 | |
2018 | 92 | |
2017 | 71 | |
2016 | 58 | |
Prior | 275 | |
Total | 602 | 572 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 602 | 572 |
Agricultural Mortgage Loans | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 4 | |
2019 | 10 | |
2018 | 8 | |
2017 | 1 | |
2016 | 18 | |
Prior | 36 | |
Total | 77 | 83 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 77 | 83 |
Agricultural Mortgage Loans | 0% - 50% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 106 | |
2019 | 139 | |
2018 | 159 | |
2017 | 167 | |
2016 | 254 | |
Prior | 733 | |
Total | 1,558 | 1,583 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,558 | 1,583 |
Agricultural Mortgage Loans | 0% - 50% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 292 | 322 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 292 | 322 |
Agricultural Mortgage Loans | 0% - 50% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 106 | 104 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 106 | 104 |
Agricultural Mortgage Loans | 0% - 50% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 255 | 241 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 255 | 241 |
Agricultural Mortgage Loans | 0% - 50% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 520 | 545 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 520 | 545 |
Agricultural Mortgage Loans | 0% - 50% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 333 | 321 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 333 | 321 |
Agricultural Mortgage Loans | 0% - 50% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 52 | 50 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 52 | 50 |
Agricultural Mortgage Loans | 50% - 70% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 204 | |
2019 | 139 | |
2018 | 186 | |
2017 | 112 | |
2016 | 129 | |
Prior | 394 | |
Total | 1,164 | 1,115 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,164 | 1,115 |
Agricultural Mortgage Loans | 50% - 70% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 93 | 82 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 93 | 82 |
Agricultural Mortgage Loans | 50% - 70% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 83 | 87 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 83 | 87 |
Agricultural Mortgage Loans | 50% - 70% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 232 | 236 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 232 | 236 |
Agricultural Mortgage Loans | 50% - 70% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 462 | 426 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 462 | 426 |
Agricultural Mortgage Loans | 50% - 70% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 269 | 251 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 269 | 251 |
Agricultural Mortgage Loans | 50% - 70% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 25 | 33 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 25 | 33 |
Agricultural Mortgage Loans | 70% - 90% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 0 | |
2018 | 3 | |
2017 | 0 | |
2016 | 0 | |
Prior | 18 | |
Total | 21 | 19 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 21 | 19 |
Agricultural Mortgage Loans | 70% - 90% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 70% - 90% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 2 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 2 | 0 |
Agricultural Mortgage Loans | 70% - 90% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 70% - 90% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 19 | 19 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 19 | 19 |
Agricultural Mortgage Loans | 70% - 90% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 70% - 90% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 0 | |
2018 | 0 | |
2017 | 0 | |
2016 | 0 | |
Prior | 0 | |
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Agricultural Mortgage Loans | 90% plus | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Total Mortgages Loan | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 1,056 | |
2019 | 1,075 | |
2018 | 1,596 | |
2017 | 1,480 | |
2016 | 3,138 | |
Prior | 4,227 | |
Total | 12,572 | 12,090 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 125 | 124 |
Current | 12,372 | 11,966 |
Total | 12,497 | 12,090 |
Recorded investment, nonaccrual status | 75 | 0 |
Total | 12,572 | 12,090 |
Non-accruing Loans with No allowance | 75 | 0 |
Interest Income on Non-accruing Loans | 1 | 0 |
Total Mortgages Loan | 30-59 Days | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 67 | 57 |
Total Mortgages Loan | 60-89 Days | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 9 | 1 |
Total Mortgages Loan | 90 Days Or Greater | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total Past Due | 49 | 66 |
Total Mortgages Loan | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 664 | |
2019 | 401 | |
2018 | 839 | |
2017 | 414 | |
2016 | 2,210 | |
Prior | 1,477 | |
Total | 6,005 | 5,639 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 6,005 | 5,639 |
Total Mortgages Loan | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 101 | |
2019 | 223 | |
2018 | 138 | |
2017 | 426 | |
2016 | 91 | |
Prior | 575 | |
Total | 1,554 | 1,522 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,554 | 1,522 |
Total Mortgages Loan | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 110 | |
2019 | 222 | |
2018 | 276 | |
2017 | 345 | |
2016 | 603 | |
Prior | 842 | |
Total | 2,398 | 2,023 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 2,398 | 2,023 |
Total Mortgages Loan | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 110 | |
2019 | 138 | |
2018 | 160 | |
2017 | 186 | |
2016 | 158 | |
Prior | 1,022 | |
Total | 1,774 | 1,963 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,774 | 1,963 |
Total Mortgages Loan | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 67 | |
2019 | 81 | |
2018 | 175 | |
2017 | 108 | |
2016 | 58 | |
Prior | 275 | |
Total | 764 | 860 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 764 | 860 |
Total Mortgages Loan | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 4 | |
2019 | 10 | |
2018 | 8 | |
2017 | 1 | |
2016 | 18 | |
Prior | 36 | |
Total | 77 | 83 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 77 | 83 |
Total Mortgages Loan | 0% - 50% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 106 | |
2019 | 139 | |
2018 | 188 | |
2017 | 491 | |
2016 | 450 | |
Prior | 1,481 | |
Total | 2,855 | 2,746 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 2,855 | 2,746 |
Total Mortgages Loan | 0% - 50% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 1,308 | 1,209 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,308 | 1,209 |
Total Mortgages Loan | 0% - 50% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 126 | 142 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 126 | 142 |
Total Mortgages Loan | 0% - 50% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 492 | 455 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 492 | 455 |
Total Mortgages Loan | 0% - 50% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 544 | 569 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 544 | 569 |
Total Mortgages Loan | 0% - 50% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 333 | 321 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 333 | 321 |
Total Mortgages Loan | 0% - 50% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 52 | 50 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 52 | 50 |
Total Mortgages Loan | 50% - 70% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 860 | |
2019 | 752 | |
2018 | 1,101 | |
2017 | 871 | |
2016 | 2,630 | |
Prior | 2,108 | |
Total | 8,322 | 8,562 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 8,322 | 8,562 |
Total Mortgages Loan | 50% - 70% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 4,301 | 4,179 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 4,301 | 4,179 |
Total Mortgages Loan | 50% - 70% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 1,163 | 1,282 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,163 | 1,282 |
Total Mortgages Loan | 50% - 70% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 1,585 | 1,354 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,585 | 1,354 |
Total Mortgages Loan | 50% - 70% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 947 | 1,221 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 947 | 1,221 |
Total Mortgages Loan | 50% - 70% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 301 | 493 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 301 | 493 |
Total Mortgages Loan | 50% - 70% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 25 | 33 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 25 | 33 |
Total Mortgages Loan | 70% - 90% | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 90 | |
2019 | 184 | |
2018 | 307 | |
2017 | 113 | |
2016 | 58 | |
Prior | 482 | |
Total | 1,234 | 782 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 1,234 | 782 |
Total Mortgages Loan | 70% - 90% | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 312 | 251 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 312 | 251 |
Total Mortgages Loan | 70% - 90% | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 265 | 98 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 265 | 98 |
Total Mortgages Loan | 70% - 90% | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 321 | 214 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 321 | 214 |
Total Mortgages Loan | 70% - 90% | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 206 | 173 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 206 | 173 |
Total Mortgages Loan | 70% - 90% | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 130 | 46 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 130 | 46 |
Total Mortgages Loan | 70% - 90% | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Total Mortgages Loan | 90% plus | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
2020 | 0 | |
2019 | 0 | |
2018 | 0 | |
2017 | 5 | |
2016 | 0 | |
Prior | 156 | |
Total | 161 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 161 | 0 |
Total Mortgages Loan | 90% plus | Greater than 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 84 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 84 | 0 |
Total Mortgages Loan | 90% plus | 1.8x to 2.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Total Mortgages Loan | 90% plus | 1.5x to 1.8x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Total Mortgages Loan | 90% plus | 1.2x to 1.5x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 77 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 77 | 0 |
Total Mortgages Loan | 90% plus | 1.0x to 1.2x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | 0 | 0 |
Total Mortgages Loan | 90% plus | Less than 1.0x | ||
Financing Receivable, before Allowance for Credit Loss [Abstract] | ||
Total | 0 | 0 |
Financing Receivable, Recorded Investment, Aging [Abstract] | ||
Total | $ 0 | $ 0 |
INVESTMENTS - Trading Securitie
INVESTMENTS - Trading Securities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Net investment gains (losses) recognized during the period on securities held at the end of the period | $ 250 | $ 150 | $ 87 | $ 424 |
Net investment gains (losses) recognized on securities sold during the period | 14 | 1 | 17 | (23) |
Unrealized and realized gains (losses) on trading securities | 264 | 151 | 104 | 401 |
Interest and dividend income from trading securities | 45 | 71 | 94 | 161 |
Net investment income (loss) from trading securities | $ 309 | $ 222 | $ 198 | $ 562 |
DERIVATIVES - Derivatives by Ca
DERIVATIVES - Derivatives by Category (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Derivatives, Fair Value [Line Items] | |||
Notional Amount | $ 108,012 | $ 117,398 | |
Derivative Assets | 10,007 | 8,271 | |
Derivative Liabilities | 20,394 | 16,948 | |
Net Derivative Gains (Losses) | 3,636 | $ (1,733) | |
Futures | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 3,848 | 3,510 | |
Derivative Assets | 0 | 0 | |
Derivative Liabilities | 0 | 0 | |
Net Derivative Gains (Losses) | (126) | (930) | |
Swaps | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 17,760 | 17,064 | |
Derivative Assets | 77 | 9 | |
Derivative Liabilities | 79 | 279 | |
Net Derivative Gains (Losses) | 963 | (1,260) | |
Equity Option | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 36,469 | 47,766 | |
Derivative Assets | 4,333 | 5,080 | |
Derivative Liabilities | 2,442 | 1,749 | |
Net Derivative Gains (Losses) | (1,387) | 1,276 | |
Swaps | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 24,771 | 23,700 | |
Derivative Assets | 2,089 | 467 | |
Derivative Liabilities | 432 | 523 | |
Net Derivative Gains (Losses) | 3,658 | 1,597 | |
Futures | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 23,565 | 20,424 | |
Derivative Assets | 0 | 0 | |
Derivative Liabilities | 0 | 0 | |
Net Derivative Gains (Losses) | 2,072 | 25 | |
Swaptions | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 0 | 3,201 | |
Derivative Assets | 0 | 16 | |
Derivative Liabilities | 0 | 0 | |
Net Derivative Gains (Losses) | 9 | 7 | |
Credit default swaps | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 1,252 | 1,232 | |
Derivative Assets | 10 | 18 | |
Derivative Liabilities | 4 | 0 | |
Net Derivative Gains (Losses) | (7) | 13 | |
Foreign Currency Contracts | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 347 | 501 | |
Derivative Assets | 0 | 3 | |
Derivative Liabilities | 0 | 0 | |
Net Derivative Gains (Losses) | (3) | (27) | |
Collateral | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 0 | 0 | |
Derivative Assets | 51 | 140 | |
Derivative Liabilities | 77 | 0 | |
Net Derivative Gains (Losses) | 0 | 0 | |
Margin | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 0 | 0 | |
Derivative Assets | 14 | 72 | |
Derivative Liabilities | 3,288 | 3,001 | |
Net Derivative Gains (Losses) | 0 | 0 | |
GMIB Reinsurance Contracts | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 0 | 0 | |
Derivative Assets | 3,433 | 2,466 | |
Derivative Liabilities | 0 | 0 | |
Net Derivative Gains (Losses) | 1,026 | 217 | |
GMxB Derivative Features’ Liability | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 0 | 0 | |
Derivative Assets | 0 | 0 | |
Derivative Liabilities | 12,382 | 8,246 | |
Net Derivative Gains (Losses) | (3,946) | (1,116) | |
SCS, SIO, MSO and IUL Indexed Features | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 0 | 0 | |
Derivative Assets | 0 | 0 | |
Derivative Liabilities | 1,690 | $ 3,150 | |
Net Derivative Gains (Losses) | 1,377 | $ (1,535) | |
Investment fees | $ 6 |
DERIVATIVES - Narrative (Detail
DERIVATIVES - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Cash and securities collateral for derivative contract | $ 3,300 | $ 3,000 |
Cash and securities collateral | 14 | 72 |
S&P 500, Russell 1000, NASDAQ 100 and Emerging Market Indices | ||
Derivative [Line Items] | ||
Initial margin requirements | 264 | 58 |
Us Treasury Notes Ultra Long Bonds And Euro Dollar | ||
Derivative [Line Items] | ||
Initial margin requirements | 404 | 165 |
Euro Stoxx, FTSE100, EAFE And Topix Indices | ||
Derivative [Line Items] | ||
Initial margin requirements | $ 43 | $ 60 |
DERIVATIVES - Offsetting of Fin
DERIVATIVES - Offsetting of Financial Assets and Liabilities and Derivative Instruments (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Total derivatives | ||
Assets | ||
Gross Amount Recognized | $ 6,573 | $ 5,804 |
Gross Amount Offset in the Balance Sheets | 6,134 | 5,429 |
Net Amount Presented in the Balance Sheets | 439 | 375 |
Gross Amount not Offset in the Balance Sheets | (118) | (77) |
Net Amount | 321 | 298 |
Liabilities | ||
Gross Amount Recognized | 6,203 | 5,474 |
Gross Amount Offset in the Balance Sheets | 6,134 | 5,429 |
Net Amount Presented in the Balance Sheets | 69 | 45 |
Gross Amount not Offset in the Balance Sheets | 0 | 0 |
Net Amount | 69 | 45 |
Other financial instruments | ||
Assets | ||
Gross Amount Recognized | 1,523 | 1,781 |
Gross Amount Offset in the Balance Sheets | 0 | 0 |
Net Amount Presented in the Balance Sheets | 1,523 | 1,781 |
Gross Amount not Offset in the Balance Sheets | 0 | 0 |
Net Amount | 1,523 | 1,781 |
Other invested assets | ||
Assets | ||
Gross Amount Recognized | 8,096 | 7,585 |
Gross Amount Offset in the Balance Sheets | 6,134 | 5,429 |
Net Amount Presented in the Balance Sheets | 1,962 | 2,156 |
Gross Amount not Offset in the Balance Sheets | (118) | (77) |
Net Amount | 1,844 | 2,079 |
Other financial liabilities | ||
Liabilities | ||
Gross Amount Recognized | 1,462 | 1,723 |
Gross Amount Offset in the Balance Sheets | 0 | 0 |
Net Amount Presented in the Balance Sheets | 1,462 | 1,723 |
Gross Amount not Offset in the Balance Sheets | 0 | 0 |
Net Amount | 1,462 | 1,723 |
Other liabilities | ||
Liabilities | ||
Gross Amount Recognized | 7,665 | 7,197 |
Gross Amount Offset in the Balance Sheets | 6,134 | 5,429 |
Net Amount Presented in the Balance Sheets | 1,531 | 1,768 |
Gross Amount not Offset in the Balance Sheets | 0 | 0 |
Net Amount | $ 1,531 | $ 1,768 |
CLOSED BLOCK - Summarized Finan
CLOSED BLOCK - Summarized Financial Information for Closed Block (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Closed Block Liabilities: | ||
Future policy benefits, policyholders’ account balances and other | $ 6,327 | $ 6,478 |
Policyholder dividend obligation | 150 | 2 |
Other liabilities | 100 | 38 |
Total Closed Block liabilities | 6,577 | 6,518 |
Assets Designated to the Closed Block: | ||
Fixed maturities available-for-sale, at fair value (amortized cost of $3,490 and $3,558) (allowance for credit losses of $0 at June 30, 2020) | 3,838 | 3,754 |
Mortgage loans on real estate (net of allowance for credit losses of $7 at June 30, 2020) | 1,774 | 1,759 |
Policy loans | 668 | 706 |
Cash and other invested assets | 44 | 82 |
Other assets | 183 | 145 |
Total assets designated to the Closed Block | 6,507 | 6,446 |
Excess of Closed Block liabilities over assets designated to the Closed Block | 70 | 72 |
Amounts included in accumulated other comprehensive income (loss): | ||
Net unrealized investment gains (losses), net of policyholders’ dividend obligation: $150 and $2; and net of income tax: $42 and $41 | 167 | 164 |
Maximum future earnings to be recognized from Closed Block assets and liabilities | 237 | 236 |
Fixed maturities available-for-sale, allowance for credit losses | 0 | |
Fixed maturities, available for sale, amortized cost | 3,490 | 3,558 |
Mortgage loans, credit losses | 7 | |
Policyholder dividend obligation | 150 | 2 |
Closed block operations, income taxes | $ 42 | $ 41 |
CLOSED BLOCK - Revenues and Exp
CLOSED BLOCK - Revenues and Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues: | ||||
Premiums and other income | $ 40 | $ 46 | $ 82 | $ 94 |
Net investment income (loss) | 63 | 72 | 129 | 139 |
Investment gains (losses), net | (2) | 0 | (2) | (1) |
Total revenues | 101 | 118 | 209 | 232 |
Benefits and Other Deductions: | ||||
Policyholders’ benefits and dividends | 103 | 114 | 206 | 235 |
Other operating costs and expenses | 1 | 0 | 1 | 1 |
Total benefits and other deductions | 104 | 114 | 207 | 236 |
Net income (loss), before income taxes | (3) | 4 | 2 | (4) |
Income tax (expense) benefit | (1) | (1) | (1) | (2) |
Net income (loss) | $ (4) | $ 3 | $ 1 | $ (6) |
INSURANCE LIABILITIES - Rollfor
INSURANCE LIABILITIES - Rollforward of Liability and Reinsurance Ceded (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
GMDB Direct | ||||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross | ||||
Balance, beginning of period | $ 5,047 | $ 4,665 | $ 4,779 | $ 4,654 |
Paid guarantee benefits | (140) | (108) | (251) | (226) |
Other changes in reserves | 102 | 153 | 481 | 282 |
Balance, end of period | 5,009 | 4,710 | 5,009 | 4,710 |
GMDB Ceded | ||||
Guaranteed Minimum Death Benefit Reinsurance Ceded [Roll Forward] | ||||
Balance, beginning of period | (105) | (103) | (98) | (107) |
Paid guarantee benefits | 4 | 5 | 9 | 9 |
Other changes in reserves | 3 | (2) | (9) | (2) |
Balance, end of period | (98) | (100) | (98) | (100) |
GMIB Direct | ||||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross | ||||
Balance, beginning of period | 6,297 | 3,740 | 4,688 | 3,741 |
Paid guarantee benefits | (103) | (56) | (177) | (112) |
Other changes in reserves | (43) | 75 | 1,640 | 130 |
Balance, end of period | 6,151 | 3,759 | 6,151 | 3,759 |
GMIB Ceded | ||||
Guaranteed Minimum Death Benefit Reinsurance Ceded [Roll Forward] | ||||
Balance, beginning of period | (3,305) | (2,009) | (2,466) | (1,991) |
Paid guarantee benefits | 17 | 14 | 37 | 35 |
Other changes in reserves | (145) | (201) | (1,004) | (240) |
Balance, end of period | $ (3,433) | $ (2,196) | $ (3,433) | $ (2,196) |
INSURANCE LIABILITIES - Variabl
INSURANCE LIABILITIES - Variable Annuity Contracts with GMDB and GMIB Features (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
GMDB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 15,225 | |
Separate Accounts | 88,055 | $ 94,488 |
Net Amount At Risk By Product And Guarantee, Account Value | 103,280 | |
Net Amount at Risk, gross | 22,762 | |
Net Amount at Risk, net of amounts reinsured | $ 22,180 | |
Percentage of policyholders over age 70 | 19.80% | |
GMDB | Return of Premium | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 14,904 | |
Separate Accounts | 46,313 | |
Net Amount At Risk By Product And Guarantee, Account Value | 61,217 | |
Net Amount at Risk, gross | 167 | |
Net Amount at Risk, net of amounts reinsured | $ 167 | |
Percentage of policyholders over age 70 | 10.90% | |
GMDB | Ratchet | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 90 | |
Separate Accounts | 8,576 | |
Net Amount At Risk By Product And Guarantee, Account Value | 8,666 | |
Net Amount at Risk, gross | 207 | |
Net Amount at Risk, net of amounts reinsured | $ 201 | |
Percentage of policyholders over age 70 | 47.10% | |
GMDB | Roll-Up | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 57 | |
Separate Accounts | 2,914 | |
Net Amount At Risk By Product And Guarantee, Account Value | 2,971 | |
Net Amount at Risk, gross | 1,990 | |
Net Amount at Risk, net of amounts reinsured | $ 1,414 | |
Percentage of policyholders over age 70 | 69.30% | |
GMDB | Combo | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 174 | |
Separate Accounts | 30,252 | |
Net Amount At Risk By Product And Guarantee, Account Value | 30,426 | |
Net Amount at Risk, gross | 20,398 | |
Net Amount at Risk, net of amounts reinsured | $ 20,398 | |
Percentage of policyholders over age 70 | 52.40% | |
GMIB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate Accounts | $ 54,792 | $ 59,348 |
Immediate Variable Annuity | GMDB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Average attained age of policyholders (in years) | 55 years 1 month 6 days | |
Immediate Variable Annuity | GMDB | Minimum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 3.00% | |
Immediate Variable Annuity | GMDB | Maximum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 6.50% | |
Immediate Variable Annuity | GMDB | Return of Premium | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Average attained age of policyholders (in years) | 51 years 2 months 12 days | |
Immediate Variable Annuity | GMDB | Ratchet | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Average attained age of policyholders (in years) | 68 years | |
Immediate Variable Annuity | GMDB | Roll-Up | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Average attained age of policyholders (in years) | 74 years 7 months 6 days | |
Immediate Variable Annuity | GMDB | Roll-Up | Minimum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 3.00% | |
Immediate Variable Annuity | GMDB | Roll-Up | Maximum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 6.00% | |
Immediate Variable Annuity | GMDB | Combo | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Average attained age of policyholders (in years) | 69 years 9 months 18 days | |
Immediate Variable Annuity | GMDB | Combo | Minimum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 3.00% | |
Immediate Variable Annuity | GMDB | Combo | Maximum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 6.50% | |
Immediate Variable Annuity | GMIB | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 241 | |
Separate Accounts | 54,792 | |
Net Amount At Risk By Product And Guarantee, Account Value | 55,033 | |
Net Amount at Risk, gross | 16,573 | |
Net Amount at Risk, net of amounts reinsured | $ 14,248 | |
Average attained age of policyholders (in years) | 69 years 7 months 6 days | |
Weighted average years remaining until annuitization (in years) | 2 years 7 months 6 days | |
Immediate Variable Annuity | GMIB | Minimum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 3.00% | |
Immediate Variable Annuity | GMIB | Maximum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 6.50% | |
Immediate Variable Annuity | GMIB | Return of Premium | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 0 | |
Separate Accounts | 0 | |
Net Amount At Risk By Product And Guarantee, Account Value | 0 | |
Net Amount at Risk, gross | 0 | |
Net Amount at Risk, net of amounts reinsured | 0 | |
Immediate Variable Annuity | GMIB | Ratchet | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | 0 | |
Separate Accounts | 0 | |
Net Amount At Risk By Product And Guarantee, Account Value | 0 | |
Net Amount at Risk, gross | 0 | |
Net Amount at Risk, net of amounts reinsured | 0 | |
Immediate Variable Annuity | GMIB | Roll-Up | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | 18 | |
Separate Accounts | 22,463 | |
Net Amount At Risk By Product And Guarantee, Account Value | 22,481 | |
Net Amount at Risk, gross | 1,189 | |
Net Amount at Risk, net of amounts reinsured | $ 376 | |
Average attained age of policyholders (in years) | 63 years 9 months 18 days | |
Weighted average years remaining until annuitization (in years) | 5 years 10 months 24 days | |
Immediate Variable Annuity | GMIB | Roll-Up | Minimum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 3.00% | |
Immediate Variable Annuity | GMIB | Roll-Up | Maximum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 6.00% | |
Immediate Variable Annuity | GMIB | Combo | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account | $ 223 | |
Separate Accounts | 32,329 | |
Net Amount At Risk By Product And Guarantee, Account Value | 32,552 | |
Net Amount at Risk, gross | 15,384 | |
Net Amount at Risk, net of amounts reinsured | $ 13,872 | |
Average attained age of policyholders (in years) | 69 years 9 months 18 days | |
Weighted average years remaining until annuitization (in years) | 8 months 12 days | |
Immediate Variable Annuity | GMIB | Combo | Minimum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 3.00% | |
Immediate Variable Annuity | GMIB | Combo | Maximum | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Range of contractually specified interest rates | 6.50% |
INSURANCE LIABILITIES - Separat
INSURANCE LIABILITIES - Separate Account Investments, Hedging Programs and Variable and Interest-Sensitive Live Insurance Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Direct Liability | |||||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross | |||||
Balance, beginning of period | $ 920 | $ 801 | $ 893 | $ 787 | |
Paid guaranteed benefits | (13) | (3) | (26) | (10) | |
Other changes in reserves | 35 | 21 | 75 | 42 | |
Balance, end of period | 942 | 819 | 942 | 819 | |
Reinsurance Ceded | |||||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross | |||||
Balance, beginning of period | (827) | (744) | (807) | (733) | |
Paid guaranteed benefits | 0 | 0 | 0 | 0 | |
Other changes in reserves | (14) | (11) | (34) | (22) | |
Balance, end of period | (841) | (755) | (841) | (755) | |
Net | |||||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross | |||||
Balance, beginning of period | 93 | 57 | 86 | 54 | |
Paid guaranteed benefits | (13) | (3) | (26) | (10) | |
Other changes in reserves | 21 | 10 | 41 | 20 | |
Balance, end of period | 101 | 64 | 101 | 64 | |
GMDB | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 88,055 | 88,055 | $ 94,488 | ||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross | |||||
Balance, beginning of period | (105) | (103) | (98) | (107) | |
Paid guaranteed benefits | (4) | (5) | (9) | (9) | |
Other changes in reserves | 3 | (2) | (9) | (2) | |
Balance, end of period | (98) | $ (100) | (98) | $ (100) | |
GMDB | Equity | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 39,126 | 39,126 | 42,489 | ||
GMDB | Fixed income | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 5,297 | 5,297 | 5,263 | ||
GMDB | Balanced | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 42,696 | 42,696 | 45,871 | ||
GMDB | Other | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 936 | 936 | 865 | ||
GMIB | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 54,792 | 54,792 | 59,348 | ||
GMIB | Equity | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 16,011 | 16,011 | 17,941 | ||
GMIB | Fixed income | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 2,682 | 2,682 | 2,699 | ||
GMIB | Balanced | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | 35,835 | 35,835 | 38,445 | ||
GMIB | Other | |||||
Fair Value, Separate Account Investment [Line Items] | |||||
Separate Accounts | $ 264 | $ 264 | $ 263 |
FAIR VALUE DISCLOSURES - Schedu
FAIR VALUE DISCLOSURES - Schedules Of Assets And Liabilities Measured On Recurring Basis (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | $ 71,822 | $ 62,362 |
Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 71,822 | 62,362 |
Other equity investments | 13 | 13 |
Trading securities | 6,141 | 6,598 |
Other invested assets: | 3,794 | 3,507 |
Cash equivalents | 3,784 | 1,155 |
GMIB reinsurance contracts asset | 3,433 | 2,466 |
Separate Accounts assets | 116,212 | 124,062 |
Total Assets | 205,199 | 200,163 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Total Liabilities | 14,072 | 11,396 |
Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 315 | 237 |
Other equity investments | 12 | 13 |
Trading securities | 282 | 321 |
Other invested assets: | 0 | 0 |
Cash equivalents | 3,784 | 1,155 |
GMIB reinsurance contracts asset | 0 | 0 |
Separate Accounts assets | 113,420 | 121,184 |
Total Assets | 117,813 | 122,910 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Total Liabilities | 0 | 0 |
Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 69,815 | 60,740 |
Other equity investments | 0 | 0 |
Trading securities | 5,859 | 6,277 |
Other invested assets: | 3,779 | 3,491 |
Cash equivalents | 0 | 0 |
GMIB reinsurance contracts asset | 0 | 0 |
Separate Accounts assets | 2,792 | 2,878 |
Total Assets | 82,245 | 73,386 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Total Liabilities | 1,690 | 3,150 |
Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 1,692 | 1,385 |
Other equity investments | 1 | 0 |
Trading securities | 0 | 0 |
Other invested assets: | 15 | 16 |
Cash equivalents | 0 | 0 |
GMIB reinsurance contracts asset | 3,433 | 2,466 |
Separate Accounts assets | 0 | 0 |
Total Assets | 5,141 | 3,867 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Total Liabilities | 12,382 | 8,246 |
Fair Value, Recurring | Fair Value Measured at Net Asset Value Per Share | ||
Assets, Fair Value Disclosure [Abstract] | ||
Separate Accounts assets | 363 | 356 |
Corporate | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 49,630 | 44,464 |
Corporate | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Corporate | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 47,978 | 43,218 |
Corporate | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 1,652 | 1,246 |
U.S. Treasury, government and agency | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 17,193 | 15,231 |
U.S. Treasury, government and agency | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 17,193 | 15,231 |
U.S. Treasury, government and agency | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
U.S. Treasury, government and agency | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 17,193 | 15,231 |
U.S. Treasury, government and agency | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
States and political subdivisions | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 712 | 649 |
States and political subdivisions | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 712 | 649 |
States and political subdivisions | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
States and political subdivisions | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 672 | 610 |
States and political subdivisions | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 40 | 39 |
Foreign governments | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 833 | 490 |
Foreign governments | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 833 | 490 |
Foreign governments | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Foreign governments | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 833 | 490 |
Foreign governments | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Residential mortgage-backed | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 158 | 173 |
Residential mortgage-backed | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 158 | 173 |
Residential mortgage-backed | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Residential mortgage-backed | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 158 | 173 |
Residential mortgage-backed | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Asset-backed | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 2,039 | 844 |
Asset-backed | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 2,039 | 844 |
Asset-backed | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Asset-backed | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 2,039 | 744 |
Asset-backed | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 100 |
Commercial mortgage-backed | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 879 | |
Commercial mortgage-backed | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 879 | |
Commercial mortgage-backed | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | |
Commercial mortgage-backed | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 879 | |
Commercial mortgage-backed | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | |
Redeemable preferred stock | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 378 | 511 |
Redeemable preferred stock | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 378 | 511 |
Redeemable preferred stock | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 315 | 237 |
Redeemable preferred stock | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 63 | 274 |
Redeemable preferred stock | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Fair Value | 0 | 0 |
Short-term investments | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 227 | 468 |
Short-term investments | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Short-term investments | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 227 | 468 |
Short-term investments | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Assets of consolidated VIEs/VOEs | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 15 | 16 |
Assets of consolidated VIEs/VOEs | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Assets of consolidated VIEs/VOEs | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Assets of consolidated VIEs/VOEs | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 15 | 16 |
Swaps | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 1,655 | (326) |
Swaps | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Swaps | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 1,655 | (326) |
Swaps | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Credit default swaps | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 6 | 18 |
Credit default swaps | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Credit default swaps | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 6 | 18 |
Credit default swaps | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Options | Fair Value, Recurring | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 1,891 | 3,331 |
Options | Fair Value, Recurring | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
Options | Fair Value, Recurring | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 1,891 | 3,331 |
Options | Fair Value, Recurring | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other invested assets: | 0 | 0 |
GMxB derivative features’ liability | Fair Value, Recurring | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 12,382 | 8,246 |
GMxB derivative features’ liability | Fair Value, Recurring | Level 1 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 0 | 0 |
GMxB derivative features’ liability | Fair Value, Recurring | Level 2 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 0 | 0 |
GMxB derivative features’ liability | Fair Value, Recurring | Level 3 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 12,382 | 8,246 |
SCS, SIO, MSO and IUL indexed features’ liability | Fair Value, Recurring | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 1,690 | 3,150 |
SCS, SIO, MSO and IUL indexed features’ liability | Fair Value, Recurring | Level 1 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 0 | 0 |
SCS, SIO, MSO and IUL indexed features’ liability | Fair Value, Recurring | Level 2 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | 1,690 | 3,150 |
SCS, SIO, MSO and IUL indexed features’ liability | Fair Value, Recurring | Level 3 | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Liabilities | $ 0 | $ 0 |
FAIR VALUE DISCLOSURES - Narrat
FAIR VALUE DISCLOSURES - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Fair Value Inputs Assets Quantitative Information 1 [Line Items] | |||
Fair value adjustments on GMIB asset | $ 302 | $ 175 | |
AFS fixed maturities transferred from Level 3 to Level 2 | 103 | $ 73 | |
AFS fixed maturities transferred from Level 3 to Level 2 | $ 219 | $ 14 | |
AFS fixed maturities transferred between Level 2 and 3 (percentage) | 2.10% | 0.60% | |
Level 3 | Fair Value, Nonrecurring | |||
Fair Value Inputs Assets Quantitative Information 1 [Line Items] | |||
Fair value measurements not included in quantitative information about level 3 fair value measurements | $ 409 | $ 325 |
FAIR VALUE DISCLOSURES - Fair V
FAIR VALUE DISCLOSURES - Fair Value Measurement Reconciliation For All Levels (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Total gains (losses), realized and unrealized, included in: | ||||
Investment gains (losses), net | $ 243 | $ (20) | ||
Transfers into level 3 | 219 | 14 | ||
Transfers out of Level 3 | (103) | (73) | ||
Corporate | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Other comprehensive income (loss) | (54) | 10 | ||
States and political subdivisions | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Other comprehensive income (loss) | 2 | 2 | ||
Asset- backed | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Other comprehensive income (loss) | 5 | |||
GMIB Reinsurance Contract Asset | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Other comprehensive income (loss) | 0 | 0 | ||
Level 3 | Corporate | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | $ 1,174 | $ 1,169 | 1,246 | 1,174 |
Net investment income (loss) | 1 | 2 | 2 | 3 |
Investment gains (losses), net | (11) | 0 | (13) | 0 |
Subtotal | (10) | 2 | (11) | 3 |
Other comprehensive income (loss) | 6 | 1 | (54) | 10 |
Purchases | 284 | 151 | 345 | 221 |
Sales | (44) | (26) | (90) | (59) |
Transfers into level 3 | 219 | (3) | 219 | 14 |
Transfers out of Level 3 | 23 | (4) | (3) | (73) |
Closing Balance | 1,652 | 1,290 | 1,652 | 1,290 |
Level 3 | States and political subdivisions | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | 36 | 39 | 39 | 38 |
Net investment income (loss) | 0 | 0 | 0 | 0 |
Investment gains (losses), net | 0 | 0 | 0 | 0 |
Subtotal | 0 | 0 | 0 | 0 |
Other comprehensive income (loss) | 5 | 1 | 2 | 2 |
Purchases | 0 | 0 | 0 | 0 |
Sales | (1) | (1) | (1) | (1) |
Transfers into level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Closing Balance | 40 | 39 | 40 | 39 |
Level 3 | Asset- backed | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | 40 | 534 | 100 | 519 |
Net investment income (loss) | 0 | 0 | 0 | 0 |
Investment gains (losses), net | 0 | 0 | 0 | 0 |
Subtotal | 0 | 0 | 0 | 0 |
Other comprehensive income (loss) | 8 | 1 | 0 | 5 |
Purchases | (48) | (1) | 0 | 10 |
Sales | 0 | 0 | 0 | 0 |
Transfers into level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | (100) | 0 |
Closing Balance | 0 | 534 | 0 | 534 |
Level 3 | Other equity investments | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | 15 | 18 | 16 | 48 |
Net investment income (loss) | 0 | 0 | 0 | 0 |
Net derivative gains (losses), excluding non-performance risk | 0 | 0 | 0 | 0 |
Nonperformance risk | 0 | 0 | 0 | 0 |
Subtotal | 0 | 0 | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 | 0 | 0 |
Purchases | 1 | 0 | 1 | 0 |
Sales | 0 | 0 | 0 | 0 |
Settlements | 0 | 0 | 0 | 0 |
Change in estimate | 0 | (2) | 0 | (3) |
Activity related to consolidated VIEs/VOEs | 0 | 0 | (1) | 0 |
Transfers into level 3 | 0 | 0 | 0 | (29) |
Transfers out of Level 3 | 0 | 16 | 0 | |
Closing Balance | 16 | 16 | 16 | 16 |
Level 3 | GMIB Reinsurance Contract Asset | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | 3,305 | 2,009 | 2,466 | 1,991 |
Net investment income (loss) | 0 | 0 | 0 | 0 |
Net derivative gains (losses), excluding non-performance risk | (139) | 178 | 1,082 | 165 |
Nonperformance risk | 272 | 12 | (56) | 52 |
Subtotal | 133 | 190 | 1,026 | 217 |
Other comprehensive income (loss) | 0 | 0 | 0 | |
Purchases | 12 | 11 | 23 | 23 |
Sales | (17) | (14) | (37) | (35) |
Settlements | 0 | 0 | 0 | 0 |
Change in estimate | 0 | 0 | (45) | 0 |
Activity related to consolidated VIEs/VOEs | 0 | 0 | 0 | 0 |
Transfers into level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 2,196 | 0 | |
Closing Balance | 3,433 | 2,196 | 3,433 | 2,196 |
Level 3 | Separate Accounts Assets | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | 0 | 23 | 0 | 21 |
Net investment income (loss) | 0 | 0 | 0 | 0 |
Net derivative gains (losses), excluding non-performance risk | 0 | 0 | 0 | 0 |
Nonperformance risk | 0 | 0 | 0 | 0 |
Subtotal | 0 | 0 | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 | 0 | |
Purchases | 0 | 3 | 0 | 8 |
Sales | 0 | 0 | 0 | 0 |
Settlements | 0 | (2) | 0 | (3) |
Change in estimate | 0 | 0 | 0 | 0 |
Activity related to consolidated VIEs/VOEs | 0 | 0 | 0 | 0 |
Transfers into level 3 | 0 | 0 | 0 | (1) |
Transfers out of Level 3 | 0 | 24 | 0 | |
Closing Balance | 0 | 25 | 0 | 25 |
Level 3 | GMxB Derivative Features Liability | ||||
Total gains (losses), realized and unrealized, included in: | ||||
Beginning Balance | (9,509) | (5,944) | (8,246) | (5,431) |
Net investment income (loss) | 0 | 0 | 0 | 0 |
Net derivative gains (losses), excluding non-performance risk | (370) | (707) | (4,440) | (656) |
Nonperformance risk | (2,411) | 0 | 494 | (460) |
Subtotal | (2,781) | (707) | (3,946) | (1,116) |
Other comprehensive income (loss) | 0 | 0 | 0 | |
Purchases | (107) | (103) | (215) | (210) |
Sales | 15 | 5 | 25 | 8 |
Settlements | 0 | 0 | 0 | 0 |
Change in estimate | 0 | 0 | 0 | 0 |
Activity related to consolidated VIEs/VOEs | 0 | 0 | 0 | 0 |
Transfers into level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | (6,749) | 0 | |
Closing Balance | $ (12,382) | $ (6,749) | $ (12,382) | $ (6,749) |
FAIR VALUE DISCLOSURES - Unreal
FAIR VALUE DISCLOSURES - Unrealized Gains (Losses) For Level 3 Instruments (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Level 3 Assets And Liabilities Held | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | $ (2,920) | $ (899) |
OCI | (52) | 17 |
Corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | 0 | 0 |
OCI | (54) | 10 |
States and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | 0 | 0 |
OCI | 2 | 2 |
Asset-backed | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | 0 | |
OCI | 5 | |
Fixed maturities, AFS | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | 0 | 0 |
OCI | (52) | 17 |
GMIB reinsurance contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | 1,026 | 217 |
OCI | 0 | 0 |
GMxB derivative features liability | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net Derivative Gains (Losses) | (3,946) | (1,116) |
OCI | $ 0 | $ 0 |
FAIR VALUE DISCLOSURES - Quanti
FAIR VALUE DISCLOSURES - Quantitative Information About Level 3 (Details) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020USD ($) | Dec. 31, 2019USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative Assets | $ 10,007 | $ 8,271 |
Corporate | Level 3 | Matrix pricing model | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets, fair value | $ 237 | $ 51 |
Corporate | Level 3 | Matrix pricing model | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Spread over Benchmark | 0 | 0.0065 |
Corporate | Level 3 | Matrix pricing model | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Spread over Benchmark | 0.058 | 0.058 |
Corporate | Level 3 | Matrix pricing model | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Spread over Benchmark | 0.0034 | 0.0186 |
Corporate | Level 3 | Market comparable companies | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets, fair value | $ 1,062 | $ 1,025 |
Corporate | Level 3 | EBITDA multiple | Market comparable companies | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 3.7 | 3.3 |
Corporate | Level 3 | EBITDA multiple | Market comparable companies | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 33.6 | 56.7 |
Corporate | Level 3 | EBITDA multiple | Market comparable companies | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 14 | 14.3 |
Corporate | Level 3 | Discount rate | Market comparable companies | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 0.062 | 0.039 |
Corporate | Level 3 | Discount rate | Market comparable companies | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 0.252 | 0.165 |
Corporate | Level 3 | Discount rate | Market comparable companies | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 0.101 | 0.100 |
Corporate | Level 3 | Cash flow multiples | Market comparable companies | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 0.8 | 0.8 |
Corporate | Level 3 | Cash flow multiples | Market comparable companies | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 25.8 | 48.1 |
Corporate | Level 3 | Cash flow multiples | Market comparable companies | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities, measurement input | 11.1 | 10.7 |
GMIB reinsurance contracts | Level 3 | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative Assets | $ 3,433 | $ 2,466 |
GMIB reinsurance contracts | Level 3 | Non-performance risk | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0055 | 0.0055 |
GMIB reinsurance contracts | Level 3 | Non-performance risk | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0144 | 0.0109 |
GMIB reinsurance contracts | Level 3 | Non-performance risk | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0073 | |
GMIB reinsurance contracts | Level 3 | Lapse rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.008 | 0.008 |
GMIB reinsurance contracts | Level 3 | Lapse rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.10 | 0.1000 |
GMIB reinsurance contracts | Level 3 | Lapse rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0155 | |
GMIB reinsurance contracts | Level 3 | Withdrawal rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0 | 0 |
GMIB reinsurance contracts | Level 3 | Withdrawal rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.08 | 0.080 |
GMIB reinsurance contracts | Level 3 | Withdrawal rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0111 | |
GMIB reinsurance contracts | Level 3 | Utilization rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0 | 0 |
GMIB reinsurance contracts | Level 3 | Utilization rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.49 | 0.490 |
GMIB reinsurance contracts | Level 3 | Utilization rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.062 | |
GMIB reinsurance contracts | Level 3 | Volatility rates - Equity | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.14 | 0.090 |
GMIB reinsurance contracts | Level 3 | Volatility rates - Equity | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.34 | 0.300 |
GMIB reinsurance contracts | Level 3 | Volatility rates - Equity | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.24 | |
GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0276 | |
GMIBNLG | Level 3 | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 12,081 | $ 8,128 |
GMIBNLG | Level 3 | Non-performance risk | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0166 | 0.0124 |
GMIBNLG | Level 3 | Lapse rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.008 | 0.008 |
GMIBNLG | Level 3 | Lapse rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.199 | 0.199 |
GMIBNLG | Level 3 | Lapse rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0259 | |
GMIBNLG | Level 3 | Withdrawal rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.003 | 0.003 |
GMIBNLG | Level 3 | Withdrawal rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.110 | 0.110 |
GMIBNLG | Level 3 | Withdrawal rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0117 | |
GMIBNLG | Level 3 | Annuitization rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0 | 0 |
GMIBNLG | Level 3 | Annuitization rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 1 | 1 |
GMIBNLG | Level 3 | Annuitization rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0619 | |
GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0138 | |
GWBL/GMWB | Level 3 | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 167 | $ 109 |
GWBL/GMWB | Level 3 | Non-performance risk | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0166 | 0.0124 |
GWBL/GMWB | Level 3 | Lapse rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.008 | 0.008 |
GWBL/GMWB | Level 3 | Lapse rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.10 | 0.100 |
GWBL/GMWB | Level 3 | Lapse rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0155 | |
GWBL/GMWB | Level 3 | Withdrawal rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0 | 0 |
GWBL/GMWB | Level 3 | Withdrawal rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.070 | 0.070 |
GWBL/GMWB | Level 3 | Withdrawal rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0111 | |
GWBL/GMWB | Level 3 | Utilization rate | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 1 | 1 |
GWBL/GMWB | Level 3 | Volatility rates - Equity | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.14 | 0.090 |
GWBL/GMWB | Level 3 | Volatility rates - Equity | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.34 | 0.300 |
GWBL/GMWB | Level 3 | Volatility rates - Equity | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.2408 | |
GIB | Level 3 | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 124 | $ 5 |
GIB | Level 3 | Non-performance risk | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0166 | |
GIB | Level 3 | Lapse rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.012 | 0.012 |
GIB | Level 3 | Lapse rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.199 | 0.199 |
GIB | Level 3 | Lapse rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0155 | |
GIB | Level 3 | Withdrawal rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0 | 0 |
GIB | Level 3 | Withdrawal rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.08 | 0.080 |
GIB | Level 3 | Withdrawal rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0111 | |
GIB | Level 3 | Utilization rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0 | 0 |
GIB | Level 3 | Utilization rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 1 | 1 |
GIB | Level 3 | Utilization rate | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0620 | |
GIB | Level 3 | Volatility rates - Equity | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.14 | 0.090 |
GIB | Level 3 | Volatility rates - Equity | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.34 | 0.300 |
GIB | Level 3 | Volatility rates - Equity | Discounted cash flow | Weighted Average | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.2400 | |
GMAB | Level 3 | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 10 | $ 4 |
GMAB | Level 3 | Non-performance risk | Discounted cash flow | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.000166 | |
GMAB | Level 3 | Lapse rate | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.01 | 0.010 |
GMAB | Level 3 | Lapse rate | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.100 | 0.100 |
GMAB | Level 3 | Volatility rates - Equity | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.140 | 0.090 |
GMAB | Level 3 | Volatility rates - Equity | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.340 | 0.300 |
Age 0-40 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0001 | 0.0001 |
Age 0-40 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0018 | 0.0018 |
Age 0-40 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0001 | 0.0001 |
Age 0-40 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0019 | 0.0019 |
Age 41-60 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0007 | 0.0007 |
Age 41-60 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0054 | 0.0054 |
Age 41-60 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0006 | 0.0006 |
Age 41-60 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0053 | 0.0053 |
Ages 61 - 115 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0042 | |
Ages 61 - 115 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.422 | |
Ages 61 - 115 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0041 | |
Ages 61 - 115 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.4139 | |
Ages 60 - 115 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.0042 | |
Ages 60 - 115 | GMIB reinsurance contracts | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing asset, measurement input | 0.4220 | |
Ages 60 - 115 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.0041 | |
Ages 60 - 115 | GMIBNLG | Level 3 | Mortality rates | Discounted cash flow | Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Servicing liability, measurement input | 0.414 |
FAIR VALUE DISCLOSURES - Carryi
FAIR VALUE DISCLOSURES - Carrying Values And Fair Values Of Financial Instruments (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Consolidated Amounts [Abstract] | ||
Mortgage loans on real estate | $ 12,506 | $ 12,090 |
Policy loans | 3,225 | 3,270 |
Policyholders’ liabilities: Investment contracts | 55,732 | 55,421 |
Separate Accounts liabilities | 116,768 | 124,646 |
Carrying Value | ||
Consolidated Amounts [Abstract] | ||
Mortgage loans on real estate | 12,506 | 12,090 |
Policy loans | 3,225 | 3,270 |
Loans to affiliates | 1,200 | 1,200 |
Policyholders’ liabilities: Investment contracts | 2,047 | 1,922 |
FHLBNY funding agreements | 6,700 | 6,909 |
Separate Accounts liabilities | 8,445 | 9,041 |
Fair Value | ||
Consolidated Amounts [Abstract] | ||
Mortgage loans on real estate | 12,572 | 12,317 |
Policy loans | 4,390 | 4,199 |
Loans to affiliates | 1,245 | 1,224 |
Policyholders’ liabilities: Investment contracts | 2,293 | 2,029 |
FHLBNY funding agreements | 6,793 | 6,957 |
Separate Accounts liabilities | 8,445 | 9,041 |
Fair Value | Level 1 | ||
Consolidated Amounts [Abstract] | ||
Mortgage loans on real estate | 0 | 0 |
Policy loans | 0 | 0 |
Loans to affiliates | 0 | 0 |
Policyholders’ liabilities: Investment contracts | 0 | 0 |
FHLBNY funding agreements | 0 | 0 |
Separate Accounts liabilities | 0 | 0 |
Fair Value | Level 2 | ||
Consolidated Amounts [Abstract] | ||
Mortgage loans on real estate | 0 | 0 |
Policy loans | 0 | 0 |
Loans to affiliates | 1,245 | 1,224 |
Policyholders’ liabilities: Investment contracts | 0 | 0 |
FHLBNY funding agreements | 6,793 | 6,957 |
Separate Accounts liabilities | 0 | 0 |
Fair Value | Level 3 | ||
Consolidated Amounts [Abstract] | ||
Mortgage loans on real estate | 12,572 | 12,317 |
Policy loans | 4,390 | 4,199 |
Loans to affiliates | 0 | 0 |
Policyholders’ liabilities: Investment contracts | 2,293 | 2,029 |
FHLBNY funding agreements | 0 | 0 |
Separate Accounts liabilities | $ 8,445 | $ 9,041 |
LOANS TO AFFILIATES (Details)
LOANS TO AFFILIATES (Details) - USD ($) | 1 Months Ended | 6 Months Ended | ||||
Dec. 31, 2019 | Nov. 30, 2019 | Dec. 31, 2018 | Apr. 30, 2018 | Jun. 30, 2020 | Jun. 30, 2019 | |
Related Party Transaction [Line Items] | ||||||
Repayments of related party debt | $ 0 | $ 572,000,000 | ||||
Parent | EQH-AEL internal debt (3.69%, due 2021) | ||||||
Related Party Transaction [Line Items] | ||||||
Loans from affiliates | $ 800,000,000 | |||||
Related party transaction, rate (as a percent) | 3.69% | |||||
Repayments of related party debt | $ 300,000,000 | $ 200,000,000 | ||||
Outstanding debt | 300,000,000 | |||||
Parent | EQH-AEL internal debt (one-month LIBOR 1.33%, due 2024) | ||||||
Related Party Transaction [Line Items] | ||||||
Loans from affiliates | $ 900,000,000 | |||||
Related party transaction, rate (as a percent) | 1.33% | |||||
Outstanding debt | $ 900,000,000 |
EQUITY - Components of AOCI (De
EQUITY - Components of AOCI (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
Equity [Abstract] | |||
Unrealized gains (losses) on investments | $ 4,680 | $ 1,571 | |
Defined benefit pension plans | (4) | (7) | |
Accumulated other comprehensive income (loss) attributable to Equitable Financial | $ 4,676 | $ 1,592 | $ 1,564 |
EQUITY - Changes in AOCI (Detai
EQUITY - Changes in AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | ||
Other Comprehensive Income (Loss), Tax [Abstract] | |||||
Net unrealized gains (losses) arising during the period | $ 2,633 | $ 1,283 | $ 4,229 | $ 2,526 | |
(Gains) losses reclassified into net income (loss) during the period | (134) | (4) | (182) | 2 | |
Net unrealized gains (losses) on investments | 2,499 | 1,279 | 4,047 | 2,528 | |
Adjustments for policyholders’ liabilities, DAC, insurance liability loss recognition and other | (930) | 12 | (964) | (473) | |
Change in unrealized gains (losses), net of adjustments (net of deferred income tax expense (benefit) of $417, $341, $820 and $541) | [1] | 1,569 | 1,291 | 3,083 | 2,055 |
Other comprehensive income (loss), attributable to Equitable Financial | 1,570 | 1,291 | 3,084 | 2,055 | |
Deferred income taxes | 417 | 341 | 820 | 541 | |
Unrealized gains (losses) on investments | |||||
Other Comprehensive Income (Loss), Tax [Abstract] | |||||
Reclassification from AOCI, current period, tax | $ (35) | $ 0 | $ (48) | $ 1 | |
[1] | See Note 11 for details of Change in unrealized gains (losses), net of adjustments. |
REDEEMABLE NONCONTROLLING INT_3
REDEEMABLE NONCONTROLLING INTEREST - Summary of Redeemable Noncontrolling Interest (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Net earnings (loss) attributable to redeemable noncontrolling interests | $ 4 | $ 1 | $ (3) | $ 3 |
Redeemable Noncontrolling Interest | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance, beginning of period | 32 | 48 | 39 | 39 |
Net earnings (loss) attributable to redeemable noncontrolling interests | 2 | 1 | (3) | 3 |
Purchase/change of redeemable noncontrolling interests | 2 | (7) | 0 | 0 |
Balance, end of period | $ 36 | $ 42 | $ 36 | $ 42 |
COMMITMENTS AND CONTINGENT LI_3
COMMITMENTS AND CONTINGENT LIABILITIES - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Feb. 29, 2016 |
Loss Contingencies [Line Items] | ||
Unaccrued amounts of reasonably possible range of losses | $ 100 | |
Federal home loan bank stock | 313 | |
Carrying value of collateral pledged for federal home loan bank | 8,600 | |
Brach Family Foundation Litigation | ||
Loss Contingencies [Line Items] | ||
Liability for future policy benefits, face value of policy | $ 1 | |
Letter of Credit | ||
Loss Contingencies [Line Items] | ||
Undrawn balance | 17 | |
AXA | ||
Loss Contingencies [Line Items] | ||
Commitments by the Company to provide equity financing | 1,200 | |
Commitments under existing mortgage loan agreements | 481 | |
Affiliated Entity | AXA | ||
Loss Contingencies [Line Items] | ||
Commitments by the Company to provide equity financing | $ 219 |
COMMITMENTS AND CONTINGENT LI_4
COMMITMENTS AND CONTINGENT LIABILITIES - Funding Agreements with FHBLNY (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Restructuring Reserve [Roll Forward] | ||
Outstanding Balance, period start | $ 6,900 | |
Issued During the Period | 22,950 | |
Repaid During the Period | 23,158 | |
Long-term Agreements Maturing Within One Year | 0 | |
Long-term Agreements Maturing Within Five Year | 0 | |
Outstanding Balance, period end | 6,692 | |
Difference related to remaining amortization | 8 | $ 9 |
Federal Home Loan Bank of New York Short-Term Funding Agreements Maturing in One Year or Less | ||
Restructuring Reserve [Roll Forward] | ||
Outstanding Balance, period start | 4,608 | |
Issued During the Period | 22,950 | |
Repaid During the Period | 23,158 | |
Long-term Agreements Maturing Within One Year | 490 | |
Long-term Agreements Maturing Within Five Year | 0 | |
Outstanding Balance, period end | 4,890 | |
Federal Home Loan Bank of New York Long-Term Funding Agreements Maturing Between Two and Five Years | ||
Restructuring Reserve [Roll Forward] | ||
Outstanding Balance, period start | 1,646 | |
Issued During the Period | 0 | |
Repaid During the Period | 0 | |
Long-term Agreements Maturing Within One Year | (490) | |
Long-term Agreements Maturing Within Five Year | 112 | |
Outstanding Balance, period end | 1,268 | |
Federal Home Loan Bank of New York Long-Term Funding Agreements Maturing in Greater than Five Years | ||
Restructuring Reserve [Roll Forward] | ||
Outstanding Balance, period start | 646 | |
Issued During the Period | 0 | |
Repaid During the Period | 0 | |
Long-term Agreements Maturing Within One Year | 0 | |
Long-term Agreements Maturing Within Five Year | (112) | |
Outstanding Balance, period end | 534 | |
Federal Home Loan Bank of New York Long-Term Funding Agreements | ||
Restructuring Reserve [Roll Forward] | ||
Outstanding Balance, period start | 2,292 | |
Issued During the Period | 0 | |
Repaid During the Period | 0 | |
Long-term Agreements Maturing Within One Year | (490) | |
Long-term Agreements Maturing Within Five Year | 0 | |
Outstanding Balance, period end | $ 1,802 |
SUBSEQUENT EVENTS - Narrative (
SUBSEQUENT EVENTS - Narrative (Details) - Trust Notes - USD ($) | Jul. 07, 2020 | Jun. 30, 2020 |
Subsequent Event [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 5,000,000,000 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Debt instrument, face amount | $ 650,000,000 | |
Debt instrument, stated percentage | 1.40% |