Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Mar. 05, 2020 | |
Cover page. | ||
Document Type | 10-K | |
Amendment Flag | false | |
Document Annual Report | true | |
Document Period End Date | Dec. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | FY | |
Document Transition Report | false | |
Entity File Number | 033-44202 | |
Entity Registrant Name | PRUDENTIAL ANNUITIES LIFE ASSURANCE CORP/CT | |
Entity Central Index Key | 0000881453 | |
Entity Incorporation, State or Country Code | AZ | |
Entity Tax Identification Number | 06-1241288 | |
Entity Address, Address Line One | One Corporate Drive | |
Entity Address, City or Town | Shelton | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06484 | |
City Area Code | 203 | |
Local Phone Number | 926-1888 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
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 | 25,000 | |
Entity Public Float | $ 0 |
Statements of Financial Positio
Statements of Financial Position - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
ASSETS | ||
Fixed maturities, available-for-sale, at fair value (amortized cost, 2019: $12,465,746; 2018: $10,186,465) | $ 13,202,365 | $ 9,771,673 |
Fixed maturities, trading, at fair value (amortized cost, 2019: $349,428; 2018: $294,549) | 383,198 | 289,752 |
Equity securities, at fair value (cost, 2019: $63,647; 2018: $18,765) | 67,503 | 20,613 |
Commercial mortgage and other loans | 1,471,522 | 1,353,478 |
Policy loans | 12,366 | 12,805 |
Short-term investments | 335,358 | 37,568 |
Other invested assets (includes $10,492 and $50,945 measured at fair value at December 31, 2019 and 2018, respectively) | 474,013 | 348,541 |
Total investments | 15,946,325 | 11,834,430 |
Cash and cash equivalents | 2,795,163 | 4,503,534 |
Deferred policy acquisition costs | 4,455,683 | 4,447,505 |
Accrued investment income | 102,724 | 90,895 |
Reinsurance recoverables | 621,510 | 572,102 |
Income taxes | 1,202,714 | 964,521 |
Value of business acquired | 30,025 | 33,222 |
Deferred sales inducements | 812,724 | 889,598 |
Receivables from parent and affiliates | 62,765 | 46,381 |
Other assets | 139,933 | 85,310 |
Separate account assets | 32,665,431 | 31,210,346 |
TOTAL ASSETS | 58,834,997 | 54,677,844 |
LIABILITIES | ||
Future policy benefits | 12,932,461 | 9,368,986 |
Policyholders’ account balances | 6,180,359 | 5,353,596 |
Payables to parent and affiliates | 185,156 | 30,846 |
Cash collateral for loaned securities | 0 | 384 |
Short-term debt | 242,094 | 140,569 |
Long-term debt | 419,418 | 787,596 |
Reinsurance payables | 235,318 | 232,937 |
Other liabilities | 447,405 | 811,016 |
Separate account liabilities | 32,665,431 | 31,210,346 |
Total liabilities | 53,307,642 | 47,936,276 |
Commitments and Contingencies | ||
EQUITY | ||
Common stock, $100 par value; 25,000 shares authorized, issued and outstanding | 2,500 | 2,500 |
Additional paid-in capital | 5,142,936 | 6,120,436 |
Retained earnings / (accumulated deficit) | (46,693) | 943,005 |
Accumulated other comprehensive income (loss) | 428,612 | (324,373) |
Total equity | 5,527,355 | 6,741,568 |
TOTAL LIABILITIES AND EQUITY | $ 58,834,997 | $ 54,677,844 |
Statements of Financial Posit_2
Statements of Financial Position (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Fixed maturities, available-for-sale, amortized cost | $ 12,465,746 | $ 10,186,465 |
Fixed Maturities, Trading, Amortized Cost | 349,428 | 294,549 |
Equity securities, at cost | 63,647 | 18,765 |
Other invested assets, fair value | $ 10,492 | $ 50,945 |
Common stock, par value (in dollars per share) | $ 100 | $ 100 |
Common stock, shares authorized | 25,000 | 25,000 |
Common stock, shares issued | 25,000 | 25,000 |
Common stock, shares outstanding | 25,000 | 25,000 |
Statements of Operations and Co
Statements of Operations and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
REVENUES | |||
Premiums | $ 59,550 | $ 67,265 | $ 63,573 |
Policy charges and fee income | 2,081,046 | 2,171,278 | 2,209,579 |
Net investment income | 551,548 | 402,808 | 422,809 |
Asset administration fees and other income | 440,483 | 389,156 | 413,375 |
Realized investment gains (losses), net: | |||
Other-than-temporary impairments on fixed maturity securities | (3,658) | (6,813) | (8,576) |
Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income (loss) | (168) | 0 | (546) |
Other realized investment gains (losses), net | (2,677,494) | 890,886 | (796,278) |
Total realized investment gains (losses), net | (2,681,320) | 884,073 | (805,400) |
TOTAL REVENUES | 451,307 | 3,914,580 | 2,303,936 |
BENEFITS AND EXPENSES | |||
Policyholders’ benefits | 143,925 | 187,088 | 114,068 |
Interest credited to policyholders’ account balances | 161,209 | 249,175 | 30,280 |
Amortization of deferred policy acquisition costs | 272,853 | 589,795 | (13,946) |
Commission expense | 889,593 | 862,338 | 861,303 |
General, administrative and other expenses | 264,155 | 181,964 | 194,636 |
TOTAL BENEFITS AND EXPENSES | 1,731,735 | 2,070,360 | 1,186,341 |
INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES | (1,280,428) | 1,844,220 | 1,117,595 |
Income tax expense (benefit) | (291,101) | 161,504 | 1,201,099 |
NET INCOME (LOSS) | (989,327) | 1,682,716 | (83,504) |
Other comprehensive income (loss), before tax: | |||
Foreign currency translation adjustments | 182 | (1,354) | 109 |
Unrealized investment gains (losses) for the period | 953,250 | (248,688) | 323,359 |
Total | 953,432 | (250,042) | 323,468 |
Less: Income tax expense (benefit) related to other comprehensive income (loss) | 200,447 | (52,510) | 98,644 |
Other comprehensive income (loss), net of taxes | 752,985 | (197,532) | 224,824 |
Comprehensive income (loss) | $ (236,342) | $ 1,485,184 | $ 141,320 |
Statements of Equity
Statements of Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings/ (Accumulated Deficit) | Accumulated Other Comprehensive Income (loss) | Total Equity |
Beginning Balance at Dec. 31, 2016 | $ 2,500 | $ 8,095,436 | $ (693,258) | $ (314,948) | $ 7,089,730 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Return of capital | (950,000) | (950,000) | ||||
Comprehensive income: | ||||||
Net income (loss) | $ (83,504) | (83,504) | (83,504) | |||
Other comprehensive income (loss), net of tax | 224,824 | 224,824 | 224,824 | |||
Total comprehensive income (loss) | 141,320 | |||||
Ending Balance at Dec. 31, 2017 | 2,500 | 7,145,436 | (776,762) | (90,124) | 6,281,050 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Return of capital | (1,025,000) | (1,025,000) | ||||
Comprehensive income: | ||||||
Net income (loss) | 1,682,716 | 1,682,716 | 1,682,716 | |||
Other comprehensive income (loss), net of tax | (197,532) | (197,532) | (197,532) | |||
Total comprehensive income (loss) | 1,485,184 | |||||
Ending Balance at Dec. 31, 2018 | 2,500 | 6,120,436 | 943,005 | (324,373) | 6,741,568 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect of adoption | 42 | |||||
Cumulative effect of adoption | ASU 2016-01 | (3) | |||||
Return of capital | (977,500) | (977,500) | ||||
Comprehensive income: | ||||||
Net income (loss) | (989,327) | (989,327) | (989,327) | |||
Other comprehensive income (loss), net of tax | $ 752,985 | 752,985 | 752,985 | |||
Total comprehensive income (loss) | (236,342) | |||||
Ending Balance at Dec. 31, 2019 | $ 2,500 | $ 5,142,936 | $ (46,693) | $ 428,612 | $ 5,527,355 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||
NET INCOME (LOSS) | $ (989,327) | $ 1,682,716 | $ (83,504) | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Policy charges and fee income | (813) | (2,686) | (766) | |
Realized investment (gains) losses, net | 2,681,320 | (884,073) | 805,400 | |
Depreciation and amortization | 865 | 7,905 | 32,812 | |
Interest credited to policyholders’ account balances | 161,209 | 249,175 | 30,280 | |
Change in: | ||||
Future policy benefits | 1,110,089 | 1,095,204 | 982,792 | |
Accrued investment income | (11,829) | (2,564) | (2,327) | |
Net receivables from/payables to parent and affiliates | 1,463 | (3,163) | 4,165 | |
Deferred sales inducements | (790) | (2,885) | (1,551) | |
Deferred policy acquisition costs | (139,774) | 216,799 | (291,532) | |
Income taxes | (438,541) | 204,634 | 763,227 | |
Reinsurance recoverables, net | (3,524) | (33,703) | 2,708 | |
Derivatives, net | (193,119) | 131,874 | (1,364,754) | |
Other, net (1) | [1] | 38,037 | 167,939 | 91,600 |
Cash flows from (used in) operating activities | 2,215,266 | 2,827,172 | 968,550 | |
Proceeds from the sale/maturity/prepayment of: | ||||
Fixed maturities, available-for-sale | 852,596 | 2,534,470 | 1,145,369 | |
Fixed maturities, trading | 149 | 99,656 | 1,739 | |
Equity securities | 8,807 | 7,896 | 3,306 | |
Commercial mortgage and other loans | 265,657 | 143,331 | 198,584 | |
Policy loans | 1,439 | 675 | 1,276 | |
Other invested assets | 27,065 | 29,103 | 72,667 | |
Short-term investments | 1,109,061 | 984,409 | 1,949,758 | |
Payments for the purchase/origination of: | ||||
Fixed maturities, available-for-sale | (3,538,800) | (2,230,936) | (1,528,065) | |
Fixed maturities, trading | (54,862) | (231,316) | (15,964) | |
Equity securities | (52,244) | (14,221) | (3,048) | |
Commercial mortgage and other loans | (382,407) | (125,007) | (348,520) | |
Policy loans | (295) | (187) | (366) | |
Other invested assets | (169,863) | (167,930) | (7,668) | |
Short-term investments | (1,406,312) | (311,277) | (1,713,877) | |
Notes receivable from parent and affiliates, net | (15,442) | 3,518 | 2,717 | |
Derivatives, net | (18,334) | 1,073 | 4,948 | |
Other, net | 0 | (69) | 254 | |
Cash flows from (used in) investing activities | (3,373,785) | 723,188 | (236,890) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||
Policyholders’ account deposits | 4,012,627 | 3,150,952 | 2,623,534 | |
Ceded policyholders' account deposits | (16,068) | (47,449) | (24,191) | |
Policyholders’ account withdrawals | (3,320,216) | (2,727,850) | (2,589,770) | |
Ceded policyholders' account withdrawals | 35,566 | 30,341 | 24,111 | |
Cash collateral for loaned securities | (384) | (16,999) | (5,967) | |
Repayments of debt (maturities longer than 90 days) | (274,569) | (43,734) | 0 | |
Net increase/(decrease) in short-term borrowing | 7,916 | 0 | (28,101) | |
Drafts outstanding | (7,503) | (7,026) | 10,624 | |
Distribution to parent | (977,500) | (1,025,000) | (950,000) | |
Other, net | (9,721) | 0 | 0 | |
Cash flows from (used in) financing activities | (549,852) | (686,765) | (939,760) | |
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (1,708,371) | 2,863,595 | (208,100) | |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 4,503,534 | 1,639,939 | 1,848,039 | |
CASH AND CASH EQUIVALENTS, END OF YEAR | 2,795,163 | 4,503,534 | 1,639,939 | |
SUPPLEMENTAL CASH FLOW INFORMATION | ||||
Income taxes paid (refund) | 147,441 | (43,130) | 437,872 | |
Interest paid | $ 26,719 | $ 33,901 | $ 34,217 | |
[1] | Prior period amounts have been reclassified to conform to current period presentation. |
Business and Basis of Presentat
Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Basis of Presentation | BUSINESS AND BASIS OF PRESENTATION Prudential Annuities Life Assurance Corporation (the “Company” or “PALAC”), with its principal offices in Shelton, Connecticut, is a wholly-owned subsidiary of Prudential Annuities, Inc. (“PAI”), which in turn is an indirect wholly-owned subsidiary of Prudential Financial, Inc. ("Prudential Financial"), a New Jersey corporation. The Company has developed long-term savings and retirement products, which are distributed through its affiliated broker-dealer company, Prudential Annuities Distributors, Inc. (“PAD”), and third-party distribution networks. The Company issued variable and fixed deferred and immediate annuities for individuals and groups in the United States of America and Puerto Rico. In addition, the Company has a relatively small in force block of variable life insurance policies. The Company stopped actively selling products by March 2010; However, the Company continues to accept additional customer deposits on certain in force contracts, subject to applicable contract provisions and administrative rules. The Company surrendered its New York license effective December 31, 2015, and reinsured the majority of its New York business to an affiliate, The Prudential Insurance Company of America (“Prudential Insurance”). The license surrender relieves the Company of the requirement to hold New York statutory reserves on its business in excess of the statutory reserves required by its domiciliary regulator, the Arizona Department of Insurance ("AZDOI"). For the small portion of New York business retained by the Company, a custodial account has been established to hold collateral assets in an amount equal to a percentage of the reserves associated with such business, as calculated in accordance with PALAC's New York Regulation 109 Plan approved by the New York Department of Financial Services. The Company resumed offering annuity products to new investors (except in New York) in 2018. The Company is engaged in a business that is highly competitive because of the large number of stock and mutual life insurance companies and other entities engaged in marketing long-term savings and retirement products, including insurance products, and individual and group annuities. Through March 31, 2016, the Company reinsured the majority of its variable annuity living benefit guarantees to its affiliated companies, Pruco Reinsurance, Ltd. ("Pruco Re") and Prudential Insurance. Effective April 1, 2016, the Company recaptured the risks related to its variable annuity living benefit guarantees that were previously reinsured to Pruco Re and Prudential Insurance. In addition, the Company reinsured the variable annuity base contracts, along with the living benefit guarantees, from Pruco Life Insurance Company ("Pruco Life"), excluding the Pruco Life Insurance Company of New Jersey ("PLNJ") business which was reinsured to Prudential Insurance, under a coinsurance and modified coinsurance agreement. This reinsurance agreement covers new and in force business and excludes business reinsured externally. The product risks related to the reinsured business are being managed in the Company. In addition, the living benefit hedging program related to the reinsured living benefit guarantees is being managed within the Company. Basis of Presentation The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The most significant estimates include those used in determining DAC and related amortization; fair value of embedded derivative instruments associated with the index-linked features of certain fixed annuity products; value of business acquired ("VOBA") and its amortization; amortization of DSI; valuation of investments including derivatives and the recognition of other-than-temporary impairments (“OTTI”); future policy benefits including guarantees; provision for income taxes and valuation of deferred tax assets; and accruals for contingent liabilities, including estimates for losses in connection with unresolved legal and regulatory matters. Reclassifications Certain amounts in prior periods have been reclassified to conform to the current period presentation. |
Significant Accounting Policies
Significant Accounting Policies and Pronouncements | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies and Pronouncements | SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS ASSETS Fixed maturities, available-for-sale, at fair value are comprised of bonds, notes and redeemable preferred stock. Fixed maturities classified as “available-for-sale” are carried at fair value. See Note 5 for additional information regarding the determination of fair value. The associated unrealized gains and losses, net of tax, and the effect on DAC, VOBA, DSI, future policy benefits, policyholders’ account balances that would result from the realization of unrealized gains and losses, are included in “Accumulated other comprehensive income (loss)” (“AOCI”). The purchased cost of fixed maturities is adjusted for amortization of premiums and accretion of discounts to maturity or, if applicable, call date. Interest income, and amortization of premium and accretion of discount are included in “Net investment income” under the effective yield method. Additionally, prepayment premiums are also included in “Net investment income”. For mortgage-backed and asset-backed securities, the effective yield is based on estimated cash flows, including interest rate and prepayment assumptions based on data from widely accepted third-party data sources or internal estimates. In addition to interest rate and prepayment assumptions, cash flow estimates also vary based on other assumptions regarding the underlying collateral including default rates and changes in value. These assumptions can significantly impact income recognition and the amount of OTTI recognized in earnings and other comprehensive income (loss) ("OCI"). For high credit quality mortgage-backed and asset-backed securities (those rated AA or above), cash flows are provided quarterly, and the amortized cost and effective yield of the securities are adjusted as necessary to reflect historical prepayment experience and changes in estimated future prepayments. The adjustments to amortized cost are recorded as a charge or credit to "Net investment income" in accordance with the retrospective method. For mortgage-backed and asset-backed securities rated below AA or those for which an OTTI has been recorded, the effective yield is adjusted prospectively for any changes in estimated cash flows. See the discussion below on realized investment gains and losses for a description of the accounting for impairments. Fixed maturities, trading, at fair value consists of fixed maturities that are carried at fair value. Realized and unrealized gains and losses on these investments are reported in “Asset administration fees and other income”, and interest and dividend income from these investments is reported in “Net investment income”. Equity securities, at fair value is comprised of common stock and mutual fund shares, which are carried at fair value. Realized and unrealized gains and losses on these investments are reported in “Asset administration fees and other income”, and dividend income is reported in “Net investment income” on the ex-dividend date. Effective January 1, 2018, the Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities using a modified retrospective method. Adoption of this ASU impacted the Company’s accounting and presentation related to equity investments. The most significant impact is that the changes in fair value of equity securities previously classified as “available-for-sale” are reported in net income within “Asset administration fees and other income” in the Statements of Operations. Prior to this, the changes in fair value on equity securities classified as “available-for-sale” were reported in AOCI. The impact of this standard resulted in an increase to retained earnings of $337 thousand , a reduction to AOCI of $3 thousand , and an increase to equity of $334 thousand upon adoption on January 1, 2018. Commercial mortgage and other loans consist of commercial mortgage loans and agricultural property loans. Commercial mortgage and other loans held for investment are generally carried at unpaid principal balance, net of unamortized deferred loan origination fees and expenses and net of an allowance for losses. Commercial mortgage and other loans acquired, including those related to the acquisition of a business, are recorded at fair value when purchased, reflecting any premiums or discounts to unpaid principal balances. Interest income, and the amortization of the related premiums or discounts, are included in “Net investment income” under the effective yield method. Prepayment fees are also included in "Net investment income". Impaired loans include those loans for which it is probable that amounts due will not all be collected according to the contractual terms of the loan agreement. The Company defines “past due” as principal or interest not collected at least 30 days past the scheduled contractual due date. Interest received on loans that are past due, including impaired and non-impaired loans, as well as, loans that were previously modified in a troubled debt restructuring, is either applied against the principal or reported as net investment income based on the Company’s assessment as to the collectability of the principal. See Note 3 for additional information about the Company’s past due loans. The Company discontinues accruing interest on loans after the loans become 90 days delinquent as to principal or interest payments, or earlier when the Company has doubts about collectability. When the Company discontinues accruing interest on a loan, any accrued but uncollectible interest on the loan and other loans backed by the same collateral, if any, is charged to interest income in the same period. Generally, a loan is restored to accrual status only after all delinquent interest and principal are brought current and, in the case of loans where the payment of interest has been interrupted for a substantial period, or the loan has been modified, a regular payment performance has been established. The Company reviews the performance and credit quality of the commercial mortgage and other loan portfolio on an on-going basis. Loans are placed on watch list status based on a predefined set of criteria and are assigned one of two categories. Loans are classified as “closely monitored” when it is determined that there is a collateral deficiency or other credit events that may lead to a potential loss of principal or interest. Loans “not in good standing” are those loans where the Company has concluded that there is a high probability of loss of principal, such as when the loan is delinquent or in the process of foreclosure. As described below, in determining the allowance for losses, the Company evaluates each loan on the watch list to determine if it is probable that amounts due will not be collected according to the contractual terms of the loan agreement. Loan-to-value and debt service coverage ratios are measures commonly used to assess the quality of commercial mortgage loans. The loan-to-value ratio compares the amount of the loan to the fair value of the underlying property collateralizing the loan, and is commonly expressed as a percentage. Loan-to-value ratios greater than 100% indicate that the loan amount exceeds the collateral value. A loan-to-value ratio less than 100% indicates an excess of collateral value over the loan amount. The debt service coverage ratio compares a property’s net operating income to its debt service payments. Debt service coverage ratios less than 1.0 times indicate that property operations do not generate enough income to cover the loan’s current debt payments. A debt service coverage ratio greater than 1.0 times indicates an excess of net operating income over the debt service payments. The values utilized in calculating these ratios are developed as part of the Company’s periodic review of the commercial mortgage loan and agricultural property loan portfolios, which includes an internal appraisal of the underlying collateral value. The Company’s periodic review also includes a quality re-rating process, whereby the internal quality rating originally assigned at underwriting is updated based on current loan, property and market information using a proprietary quality rating system. The loan-to-value ratio is the most significant of several inputs used to establish the internal credit rating of a loan which in turn drives the allowance for losses. Other key factors considered in determining the internal credit rating include debt service coverage ratios, amortization, loan term, and estimated market value growth rate and volatility for the property type and region. See Note 3 for additional information related to the loan-to-value ratios and debt service coverage ratios related to the Company’s commercial mortgage and agricultural loan portfolios. The allowance for losses includes a loan specific reserve for each impaired loan that has a specifically identified loss and a portfolio reserve for probable incurred but not specifically identified losses. For impaired commercial mortgage and other loans the allowances for losses are determined based on the present value of expected future cash flows discounted at the loan’s effective interest rate, or based upon the fair value of the collateral if the loan is collateral dependent. The portfolio reserves for probable incurred but not specifically identified losses in the commercial mortgage and agricultural loan portfolios consider the current credit composition of the portfolio based on an internal quality rating as described above. The portfolio reserves are determined using past loan experience, including historical credit migration, loss probability and loss severity factors by property type. These factors are reviewed and updated as appropriate. The allowance for losses on commercial mortgage and other loans can increase or decrease from period to period based on the factors noted above. “Realized investment gains (losses), net” includes changes in the allowance for losses. “Realized investment gains (losses), net” also includes gains and losses on sales, certain restructurings, and foreclosures. When a commercial mortgage or other loan is deemed to be uncollectible, any specific valuation allowance associated with the loan is reversed and a direct write down of the carrying amount of the loan is made. The carrying amount of the loan is not adjusted for subsequent recoveries in value. Commercial mortgage and other loans are occasionally restructured in a troubled debt restructuring. These restructurings generally include one or more of the following: full or partial payoffs outside of the original contract terms; changes to interest rates; extensions of maturity; or additions or modifications to covenants. Additionally, the Company may accept assets in full or partial satisfaction of the debt as part of a troubled debt restructuring. When restructurings occur, they are evaluated individually to determine whether the restructuring or modification constitutes a “troubled debt restructuring” as defined by authoritative accounting guidance. If the borrower is experiencing financial difficulty and the Company has granted a concession, the restructuring, including those that involve a partial payoff or the receipt of assets in full satisfaction of the debt is deemed to be a troubled debt restructuring. Based on the Company’s credit review process described above, these loans generally would have been deemed impaired prior to the troubled debt restructuring, and specific allowances for losses would have been established prior to the determination that a troubled debt restructuring has occurred. In a troubled debt restructuring where the Company receives assets in full satisfaction of the debt, any specific valuation allowance is reversed and a direct write-down of the loan is recorded for the amount of the allowance, and any additional loss, net of recoveries, or any gain is recorded for the difference between the fair value of the assets received and the recorded investment in the loan. When assets are received in partial settlement, the same process is followed, and the remaining loan is evaluated prospectively for impairment based on the credit review process noted above. When a loan is restructured in a troubled debt restructuring, the impairment of the loan is remeasured using the modified terms and the loan’s original effective yield, and the allowance for loss is adjusted accordingly. Subsequent to the modification, income is recognized prospectively based on the modified terms of the loans in accordance with the income recognition policy noted above. Additionally, the loan continues to be subject to the credit review process noted above. In situations where a loan has been restructured in a troubled debt restructuring and the loan has subsequently defaulted, this factor is considered when evaluating the loan for a specific allowance for losses in accordance with the credit review process noted above. See Note 3 for additional information about commercial mortgage and other loans that have been restructured in a troubled debt restructuring. 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. Short-term investments primarily consist of highly liquid debt instruments with a maturity of twelve months or less and greater than three months when purchased. These investments are generally carried at fair value or amortized cost that approximates fair value and include certain money market investments, funds managed similar to regulated money market funds, short-term debt securities issued by government sponsored entities and other highly liquid debt instruments. Other invested assets consist of the Company’s non-coupon investments in limited partnerships and limited liability companies ("LPs/LLCs") (other than operating joint ventures), derivative assets and other investments. LPs/LLCs interests are accounted for using either the equity method of accounting, or at fair value with changes in fair value reported in “Asset administration fees and other income”. The Company’s income from investments in LPs/LLCs accounted for using the equity method, other than the Company’s investments in operating joint ventures, is included in “Net investment income.” The carrying value of these investments is written down, or impaired, to fair value when a decline in value is considered to be other-than-temporary. In applying the equity method (including assessment for OTTI), the Company uses financial information provided by the investee, generally on a one to three-month lag. For the investments reported at fair value with changes in fair value reported in current earnings, the associated realized and unrealized gains and losses are reported in “Asset administration fees and other income”. Realized investment gains (losses) are computed using the specific identification method. Realized investment gains and losses are generated from numerous sources, including the sales of fixed maturity securities, investments in joint ventures and limited partnerships and other types of investments, as well as adjustments to the cost basis of investments for net OTTI recognized in earnings. Realized investment gains and losses also reflect changes in the allowance for losses on commercial mortgage and other loans, and fair value changes on embedded derivatives and free-standing derivatives that do not qualify for hedge accounting treatment. See “Derivative Financial Instruments” below for additional information regarding the accounting for derivatives. The Company’s available-for-sale securities with unrealized losses are reviewed quarterly to identify OTTI in value. In evaluating whether a decline in value is other-than-temporary, the Company considers several factors including, but not limited to the following: (1) the extent and the duration of the decline; (2) the reasons for the decline in value (credit event, currency or interest-rate related, including general credit spread widening); and (3) the financial condition of and near-term prospects of the issuer. An OTTI is recognized in earnings for a debt security in an unrealized loss position when the Company either (1) has the intent to sell the debt security or (2) it is more likely than not will be required to sell the debt security before its anticipated recovery. For all debt securities in unrealized loss positions that do not meet either of these two criteria, the Company analyzes its ability to recover the amortized cost by comparing the net present value of projected future cash flows with the amortized cost of the security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. The Company may use the estimated fair value of collateral as a proxy for the net present value if it believes that the security is dependent on the liquidation of collateral for recovery of its investment. If the net present value is less than the amortized cost of the investment an OTTI is recognized. When an OTTI of a debt security has occurred, the amount of the OTTI recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis. If the debt security meets either of these two criteria, the OTTI recognized in earnings is equal to the entire difference between the security’s amortized cost basis and its fair value at the impairment measurement date. For OTTI of debt securities that do not meet these criteria, the net amount recognized in earnings is equal to the difference between the amortized cost of the debt security and its net present value calculated as described above. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in OCI. Unrealized gains or losses on securities for which an OTTI has been recognized in earnings is tracked as a separate component of AOCI. The split between the amount of an OTTI recognized in OCI and the net amount recognized in earnings for debt securities is driven principally by assumptions regarding the amount and timing of projected cash flows. For mortgage-backed and asset-backed securities, cash flow estimates consider the payment terms of the underlying assets backing a particular security, including interest rate and prepayment assumptions, based on data from widely accepted third-party data sources or internal estimates. In addition to interest rate and prepayment assumptions, cash flow estimates also include other assumptions regarding the underlying collateral including default rates and recoveries, which vary based on the asset type and geographic location, as well as the vintage year of the security. For structured securities, the payment priority within the tranche structure is also considered. For all other debt securities, cash flow estimates are driven by assumptions regarding probability of default and estimates regarding timing and amount of recoveries associated with a default. The Company has developed these estimates using information based on its historical experience as well as using market observable data, such as industry analyst reports and forecasts, sector credit ratings and other data relevant to the collectability of a security, such as the general payment terms of the security and the security’s position within the capital structure of the issuer. The new cost basis of an impaired security is not adjusted for subsequent increases in estimated fair value. In periods subsequent to the recognition of an OTTI, the impaired security is accounted for as if it had been purchased on the measurement date of the impairment. For debt securities, the discount (or reduced premium) based on the new cost basis may be accreted into net investment income in future periods, including increases in cash flows on a prospective basis. In certain cases where there are decreased cash flow expectations, the security is reviewed for further cash flow impairments. Unrealized investment gains and losses are also considered in determining certain other balances, including DAC, VOBA, DSI, certain future policy benefits and deferred tax assets or liabilities. These balances are adjusted, as applicable, for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. Each of these balances is discussed in greater detail below. Cash and cash equivalents include cash on hand, amounts due from banks, certain money market investments, funds managed similar to regulated money market funds, other debt instruments with maturities of three months or less when purchased, other than cash equivalents that are included in "Fixed maturities, available-for-sale, at fair value", and receivables related to securities purchased under agreements to resell (see also "Securities sold under agreements to purchase" below). The Company also engages in overnight borrowing and lending of funds with Prudential Financial and affiliates which are considered cash and cash equivalents. These assets are generally carried at fair value or amortized cost which approximates fair value. Deferred policy acquisition costs are directly related to the successful acquisition of new and renewal insurance and annuity business that have been deferred to the extent such costs are deemed recoverable from future profits. Such DAC primarily includes commissions, costs of policy issuance and underwriting, and certain other expenses that are directly related to successfully negotiated contracts. In each reporting period, capitalized DAC is amortized to “Amortization of DAC", net of the accrual of imputed interest on DAC balances. DAC is subject to periodic recoverability testing. DAC, for applicable products, is adjusted for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. DAC related to fixed and variable deferred annuity products are generally deferred and amortized over the expected life of the contracts in proportion to gross profits arising principally from investment margins, mortality and expense margins, and surrender charges, based on historical and anticipated future experience, which is updated periodically. The Company uses a reversion to the mean approach for equities to derive future equity return assumptions. However, if the projected equity return calculated using this approach is greater than the maximum equity return assumption, the maximum equity return is utilized. Gross profits also include impacts from the embedded derivatives associated with certain of the optional living benefit features of variable annuity contracts, and index-linked crediting features of fixed indexed annuity contracts and related hedging activities. In calculating gross profits, profits and losses related to contracts issued by the Company that are reported in affiliated legal entities other than the Company as a result of, for example, reinsurance agreements with those affiliated entities, are also included. The Company is an indirect subsidiary of Prudential Financial, a United States Securities and Exchange Commission (the "SEC") registrant, and has extensive transactions and relationships with other subsidiaries of Prudential Financial, including reinsurance agreements, as described in Note 10 . Incorporating all product-related profits and losses in gross profits, including those that are reported in affiliated legal entities, produces a DAC amortization pattern representative of the total economics of the products. Total gross profits include both actual gross profits and estimates of gross profits for future periods. The Company regularly evaluates and adjusts DAC balances with a corresponding charge or credit to current period earnings, representing a cumulative adjustment to all prior periods’ amortization, for the impact of actual gross profits and changes in the Company's projections of estimated future gross profits. Adjustments to DAC balances include: (i) annual review of assumptions that reflect the comprehensive review of the assumptions used in estimating gross profits for future periods, (ii) quarterly adjustments for current period experience (also referred to as “experience true-up” adjustments) that reflect the impact of differences between actual gross profits for a given period and the previously estimated expected gross profits for that period, and (iii) quarterly adjustments for market performance (also referred to as “experience unlocking”) that reflect the impact of changes to the Company's estimate of total gross profits to reflect actual fund performance and market conditions. For some products, policyholders can elect to modify product benefits, features, rights or coverages by exchanging a contract for a new contract or by amendment, endorsement, or rider to a contract, or by the election of a feature or coverage within a contract. These transactions are known as internal replacements. For internal replacement transactions, except those that involve the addition of a nonintegrated contract feature that does not change the existing base contract, the unamortized DAC is immediately charged to expense if the terms of the new policies are not substantially similar to those of the former policies. If the new terms are substantially similar to those of the earlier policies, the DAC is retained with respect to the new policies and amortized over the expected life of the new policies. See Note 6 for additional information regarding DAC. Accrued investment income primarily includes accruals of interest and dividend income from investments that have been earned but not yet received. Reinsurance recoverables include corresponding receivables associated with reinsurance arrangements with affiliates. For additional information about these arrangements see Note 10 . Income taxes asset primarily represents the net deferred tax asset and the Company’s estimated taxes receivable for the current year and open audit years. The Company is a member of the federal income tax return of Prudential Financial and primarily files separate company state and local tax returns. Pursuant to the tax allocation arrangement with Prudential Financial, total federal income tax expense is determined on a separate company basis. Members record tax benefits to the extent tax losses or tax credits are recognized in the consolidated federal tax provision. Items required by tax regulations to be included in the tax return may differ from the items reflected in the financial statements. As a result, the effective tax rate reflected in the financial statements may be different than the actual rate applied on the tax return. Some of these differences are permanent such as expenses that are not deductible in the Company’s tax return, and some differences are temporary, reversing over time, such as valuation of insurance reserves. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that can be used as a tax deduction or credit in future years for which the Company has already recorded the tax benefit in the Company’s Statements of Operations. Deferred tax liabilities generally represent tax expense recognized in the Company’s financial statements for which payment has been deferred, or expenditures for which the Company has already taken a deduction in the Company’s tax return but have not yet been recognized in the Company’s financial statements. Deferred income taxes are recognized, based on enacted rates, when assets and liabilities have different values for financial statement and tax reporting purposes. The application of U.S. GAAP requires the Company to evaluate the recoverability of the Company’s deferred tax assets and establish a valuation allowance if necessary to reduce the Company’s deferred tax assets to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. See Note 11 for a discussion of factors considered when evaluating the need for a valuation allowance. In December of 2017, SEC staff issued "SAB 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act" ("SAB 118"), which allowed registrants to record provisional amounts during a 'measurement period' not to extend beyond one year. Under the relief provided by SAB 118, a company could recognize provisional amounts when it did not have the necessary information available, prepared or analyzed in reasonable detail to complete its accounting for the change in tax law. See Note 11 for a discussion of provisional amounts related to The United States Tax Cuts and Jobs Act of 2017 ("Tax Act of 2017") recorded in 2017 and adjustments to provisional amounts recorded in 2018. U.S. GAAP prescribes a comprehensive model for how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that a company has taken or expects to take on tax returns. The application of this guidance is a two-step process. First, the Company determines whether it is more likely than not, based on the technical merits, that the tax position will be sustained upon examination. If a tax position does not meet the more likely than not recognition threshold, the benefit of that position is not recognized in the financial statements. The second step is measurement. The Company measures the tax position as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate resolution with a taxing authority that has full knowledge of all relevant information. This measurement considers the amounts and probabilities of the outcomes that could be realized upon ultimate settlement using the facts, circumstances, and information available at the reporting date. The Company’s liability for income taxes includes a liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by the Internal Revenue Service (“IRS”) or other taxing jurisdictions. Audit periods remain open for review until the statute of limitations has passed. Generally, for tax years which produce net operating losses, capital losses or tax credit carryforwards (“tax attributes”), the statute of limitations does not close, to the extent of these tax attributes, until the expiration of the statute of limitations for the tax year in which they are fully utilized. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the liability for income taxes. The Company classifies all interest and penalties related to tax uncertainties as income tax expense. See Note 11 for additional information regarding income taxes. Effective January 1, 2018, the Company adopted ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (Loss) , which allowed a reclassification from AOCI to retained earnings for stranded effects resulting from the Tax Act of 2017. The Company elected to apply the ASU subsequent to recording the adoption impacts of ASU 2016-01 as described above. As a result, the Company reclassified stranded effects resulting from the Tax Act of 2017 by decreasing AOCI and increasing retained earnings, each by $36.7 million upon adoption on January 1, 2018. Stranded effects unrelated to the Tax Act of 2017 are generally released from AOCI when an entire portfolio of the type of item related to the stranded effect is liquidated, sold or extinguished (i.e., portfolio approach). VOBA represents identifiable intangible assets to which a portion of the purchase price in a business acquisition is attributed under the application of purchase accounting. VOBA represents an adjustment to the stated value of in force insurance contract liabilities to present them at fair va |
Investments
Investments | 12 Months Ended |
Dec. 31, 2019 | |
Investments [Abstract] | |
Investments | 3. INVESTMENTS Fixed Maturity Securities The following tables set forth the composition of fixed maturity securities (excluding investments classified as trading), as of the dates indicated: December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value OTTI in AOCI(3) (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 6,667,347 $ 491,943 $ 39,466 $ 7,119,824 $ 0 Obligations of U.S. states and their political subdivisions 252,304 7,814 436 259,682 0 Foreign government bonds 203,386 19,518 20 222,884 0 U.S. public corporate securities 1,615,060 126,947 1,331 1,740,676 0 U.S. private corporate securities 1,159,962 50,720 3,343 1,207,339 0 Foreign public corporate securities 321,111 16,989 113 337,987 0 Foreign private corporate securities 1,171,411 50,069 7,995 1,213,485 0 Asset-backed securities(1) 443,767 3,405 2,734 444,438 (20 ) Commercial mortgage-backed securities 557,584 20,941 236 578,289 0 Residential mortgage-backed securities(2) 73,814 3,960 13 77,761 0 Total fixed maturities, available-for-sale $ 12,465,746 $ 792,306 $ 55,687 $ 13,202,365 $ (20 ) (1) Includes credit-tranched securities collateralized by loan obligations, sub-prime mortgages, auto loans, equipment leases and education loans. (2) Includes publicly-traded agency pass-through securities and collateralized mortgage obligations. (3) Represents the amount of unrealized losses remaining in AOCI, from the impairment measurement date. Amount excludes $14.3 million of net unrealized gains on impaired available-for-sale securities relating to changes in the value of such securities subsequent to the impairment measurement date. December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value OTTI in AOCI(3) (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 5,240,519 $ 20,065 $ 376,493 $ 4,884,091 $ 0 Obligations of U.S. states and their political subdivisions 133,670 621 3,127 131,164 0 Foreign government bonds 199,044 4,748 4,156 199,636 0 U.S. public corporate securities 1,498,130 26,425 50,582 1,473,973 0 U.S. private corporate securities 1,070,400 15,430 22,877 1,062,953 0 Foreign public corporate securities 296,029 1,888 6,831 291,086 0 Foreign private corporate securities 829,588 10,415 27,771 812,232 0 Asset-backed securities(1) 505,862 3,147 3,765 505,244 (16 ) Commercial mortgage-backed securities 364,601 2,770 5,491 361,880 0 Residential mortgage-backed securities(2) 48,622 1,290 498 49,414 0 Total fixed maturities, available-for-sale $ 10,186,465 $ 86,799 $ 501,591 $ 9,771,673 $ (16 ) (1) Includes credit-tranched securities collateralized by loan obligations, sub-prime mortgages, auto loans, equipment leases, education loans and other asset types. (2) Includes publicly-traded agency pass-through securities and collateralized mortgage obligations. (3) Represents the amount of unrealized losses remaining in AOCI, from the impairment measurement date. Amount excludes $3.3 million of net unrealized losses on impaired available-for-sale securities relating to changes in the value of such securities subsequent to the impairment measurement date. The following tables set forth the fair value and gross unrealized losses aggregated by investment category and length of time that individual fixed maturity securities had been in a continuous unrealized loss position, as of the dates indicated: December 31, 2019 Less Than Twelve Months Twelve Months or More Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 1,336,007 $ 39,456 $ 5,855 $ 10 $ 1,341,862 $ 39,466 Obligations of U.S. states and their political subdivisions 97,752 436 0 0 97,752 436 Foreign government bonds 804 13 132 7 936 20 U.S. public corporate securities 93,147 870 15,491 461 108,638 1,331 U.S. private corporate securities 82,709 2,111 59,797 1,232 142,506 3,343 Foreign public corporate securities 50,150 113 0 0 50,150 113 Foreign private corporate securities 97,414 1,652 91,863 6,343 189,277 7,995 Asset-backed securities 103,911 717 235,759 2,017 339,670 2,734 Commercial mortgage-backed securities 66,071 236 0 0 66,071 236 Residential mortgage-backed securities 633 12 7 1 640 13 Total fixed maturities, available-for-sale $ 1,928,598 $ 45,616 $ 408,904 $ 10,071 $ 2,337,502 $ 55,687 December 31, 2018 Less Than Twelve Months Twelve Months or More Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 367,796 $ 4,844 $ 3,304,663 $ 371,649 $ 3,672,459 $ 376,493 Obligations of U.S. states and their political subdivisions 25,764 322 83,950 2,805 109,714 3,127 Foreign government bonds 98,437 2,346 58,975 1,810 157,412 4,156 U.S. public corporate securities 627,589 28,474 386,599 22,108 1,014,188 50,582 U.S. private corporate securities 269,545 7,755 422,498 15,122 692,043 22,877 Foreign public corporate securities 97,367 2,521 107,286 4,310 204,653 6,831 Foreign private corporate securities 373,891 19,217 116,743 8,554 490,634 27,771 Asset-backed securities 358,668 3,501 24,529 264 383,197 3,765 Commercial mortgage-backed securities 45,432 355 159,638 5,136 205,070 5,491 Residential mortgage-backed securities 34 1 13,775 497 13,809 498 Total fixed maturities, available-for-sale $ 2,264,523 $ 69,336 $ 4,678,656 $ 432,255 $ 6,943,179 $ 501,591 As of December 31, 2019 and 2018 , the gross unrealized losses on fixed maturity securities were composed of $52.5 million and $485.7 million , respectively, related to “1” highest quality or “2” high quality securities based on the National Association of Insurance Commissioners (“NAIC”) or equivalent rating and $3.2 million and $15.9 million , respectively, related to other than high or highest quality securities based on NAIC or equivalent rating. As of December 31, 2019 , the $10.1 million of gross unrealized losses of twelve months or more were concentrated in the Company’s corporate securities within the consumer non-cyclical , utility and consumer cyclical sectors and in asset-backed securities . As of December 31, 2018 , the $432.3 million of gross unrealized losses of twelve months or more were concentrated in U.S. government bonds and in the Company’s corporate securities within the finance , consumer non-cyclical and capital goods sectors. In accordance with its policy described in Note 2 , the Company concluded that an adjustment to earnings for OTTI for these fixed maturity securities was not warranted at either December 31, 2019 or 2018 . These conclusions were based on a detailed analysis of the underlying credit and cash flows on each security. Gross unrealized losses are primarily attributable to general credit spread widening, increases in interest rates and foreign currency exchange rate movements. As of December 31, 2019 , the Company did not intend to sell these securities, and it was not more likely than not that the Company would be required to sell these securities before the anticipated recovery of the remaining amortized cost basis. The following table sets forth the amortized cost and fair value of fixed maturities by contractual maturities, as of the date indicated: December 31, 2019 Amortized Cost Fair Value (in thousands) Fixed maturities, available-for-sale: Due in one year or less $ 90,826 $ 91,258 Due after one year through five years 1,116,306 1,149,228 Due after five years through ten years 1,762,440 1,862,864 Due after ten years 8,421,009 8,998,527 Asset-backed securities 443,767 444,438 Commercial mortgage-backed securities 557,584 578,289 Residential mortgage-backed securities 73,814 77,761 Total fixed maturities, available-for-sale $ 12,465,746 $ 13,202,365 Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Asset-backed, commercial mortgage-backed and residential mortgage-backed securities are shown separately in the table above, as they do not have a single maturity date. The following table sets forth the sources of fixed maturity proceeds and related investment gains (losses), as well as losses on impairments of fixed maturities, for the periods indicated: Years Ended December 31, 2019 2018 2017 (in thousands) Fixed maturities, available-for-sale: Proceeds from sales(1) $ 384,592 $ 2,126,886 $ 517,743 Proceeds from maturities/prepayments 468,004 404,679 630,140 Gross investment gains from sales and maturities 3,259 21,129 8,992 Gross investment losses from sales and maturities (3,364 ) (98,047 ) (3,047 ) OTTI recognized in earnings(2) (3,826 ) (6,813 ) (9,122 ) (1) Includes $0.0 million , $(2.9) million and $2.5 million of non-cash related proceeds due to the timing of trade settlements for the years ended December 31, 2019 , 2018 and 2017 , respectively. (2) Excludes the portion of OTTI amounts remaining in OCI, representing any difference between the fair value of the impaired debt security and the net present value of its projected future cash flows at the time of the impairment. The following table sets forth a rollforward of pre-tax amounts remaining in OCI related to fixed maturity securities with credit loss impairments recognized in earnings, for the periods indicated: Years Ended December 31, 2019 2018 (in thousands) Credit loss impairments: Balance in OCI, beginning of period $ (209 ) $ 792 New credit loss impairments 1,343 0 Increases due to the passage of time on previously recorded credit losses 10 3 Reductions for securities which matured, paid down, prepaid or were sold during the period 223 (40 ) Reductions for securities impaired to fair value during the period (1,351 ) (963 ) Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected (2 ) (1 ) Balance in OCI, end of period $ 14 $ (209 ) Equity Securities The net change in unrealized gains (losses) from equity securities still held at period end, recorded within “Asset administration fees and other income (loss),” was $2.0 million and $(1.9) million during the years ended December 31, 2019 and 2018 , respectively. The net change in unrealized gains (losses) from equity securities still held at period end, recorded within “Other comprehensive income (loss),” was $0.4 million during the year ended December 31, 2017 . Commercial Mortgage and Other Loans The following table sets forth the composition of “Commercial mortgage and other loans,” as of the dates indicated: December 31, 2019 December 31, 2018 Amount (in thousands) % of Total Amount (in thousands) % of Total Commercial mortgage and agricultural property loans by property type: Apartments/Multi-Family $ 272,150 18.5 % $ 304,644 22.4 % Hospitality 16,819 1.1 3,633 0.3 Industrial 464,528 31.5 355,758 26.2 Office 372,823 25.3 305,537 22.5 Other 156,768 10.6 137,781 10.2 Retail 131,051 8.9 194,646 14.4 Total commercial mortgage loans 1,414,139 95.9 1,301,999 96.0 Agricultural property loans 60,046 4.1 54,375 4.0 Total commercial mortgage and agricultural property loans by property type 1,474,185 100.0 % 1,356,374 100.0 % Allowance for credit losses (2,663 ) (2,896 ) Total commercial mortgage and other loans $ 1,471,522 $ 1,353,478 As of December 31, 2019 , the commercial mortgage and agricultural property loans were secured by properties geographically dispersed throughout the United States (with the largest concentrations in California ( 27% ), Texas ( 13% ) and New York ( 7% )) and included loans secured by properties in Europe ( 16% ) and Australia ( 4% ). The following table sets forth the activity in the allowance for credit losses for commercial mortgage and other loans, as of the dates indicated: Commercial Mortgage Loans Agricultural Property Loans Total (in thousands) Balance at December 31, 2016 $ 2,267 $ 22 $ 2,289 Addition to (release of) allowance for credit losses 349 12 361 Charge-offs, net of recoveries 0 0 0 Balance at December 31, 2017 2,616 34 2,650 Addition to (release of) allowance for credit losses 245 1 246 Charge-offs, net of recoveries 0 0 0 Balance at December 31, 2018 2,861 35 2,896 Addition to (release of) allowance for credit losses (239 ) 6 (233 ) Charge-offs, net of recoveries 0 0 0 Balance at December 31, 2019 $ 2,622 $ 41 $ 2,663 The following tables set forth the allowance for credit losses and the recorded investment in commercial mortgage and other loans, as of the dates indicated: December 31, 2019 Commercial Mortgage Loans Agricultural Property Loans Total (in thousands) Allowance for credit losses: Individually evaluated for impairment $ 0 $ 0 $ 0 Collectively evaluated for impairment 2,622 41 2,663 Total ending balance(1) $ 2,622 $ 41 $ 2,663 Recorded investment(2): Individually evaluated for impairment $ 0 $ 0 $ 0 Collectively evaluated for impairment 1,414,139 60,046 1,474,185 Total ending balance(1) $ 1,414,139 $ 60,046 $ 1,474,185 (1) As of December 31, 2019 , there were no loans acquired with deteriorated credit quality. (2) Recorded investment reflects the carrying value gross of related allowance. December 31, 2018 Commercial Mortgage Loans Agricultural Property Loans Total (in thousands) Allowance for credit losses: Individually evaluated for impairment $ 0 $ 0 $ 0 Collectively evaluated for impairment 2,861 35 2,896 Total ending balance(1) $ 2,861 $ 35 $ 2,896 Recorded investment(2): Individually evaluated for impairment $ 0 $ 3,439 $ 3,439 Collectively evaluated for impairment 1,301,999 50,936 1,352,935 Total ending balance(1) $ 1,301,999 $ 54,375 $ 1,356,374 (1) As of December 31, 2018 , there were no loans acquired with deteriorated credit quality. (2) Recorded investment reflects the carrying value gross of related allowance. The following tables set forth certain key credit quality indicators for commercial mortgage and agricultural property loans based upon the recorded investment gross of allowance for credit losses, as of the dates indicated: December 31, 2019 Debt Service Coverage Ratio > 1.2X 1.0X to <1.2X < 1.0X Total (in thousands) Loan-to-Value Ratio: 0%-59.99% $ 715,654 $ 6,641 $ 3,609 $ 725,904 60%-69.99% 499,493 14,078 0 513,571 70%-79.99% 203,158 30,555 0 233,713 80% or greater 0 997 0 997 Total commercial mortgage and agricultural property loans $ 1,418,305 $ 52,271 $ 3,609 $ 1,474,185 December 31, 2018 Debt Service Coverage Ratio > 1.2X 1.0X to <1.2X < 1.0X Total (in thousands) Loan-to-Value Ratio: 0%-59.99% $ 709,342 $ 14,814 $ 345 $ 724,501 60%-69.99% 442,308 23,260 0 465,568 70%-79.99% 156,049 7,236 0 163,285 80% or greater 2,000 1,020 0 3,020 Total commercial mortgage and agricultural property loans $ 1,309,699 $ 46,330 $ 345 $ 1,356,374 The following tables set forth an aging of past due commercial mortgage and other loans based upon the recorded investment gross of allowance for credit losses, as well as the amount of commercial mortgage and other loans on non-accrual status, as of the dates indicated: December 31, 2019 Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due(1) Total Loans Non-Accrual Status(2) (in thousands) Commercial mortgage loans $ 1,414,139 $ 0 $ 0 $ 0 $ 1,414,139 $ 0 Agricultural property loans 60,046 0 0 0 60,046 0 Total $ 1,474,185 $ 0 $ 0 $ 0 $ 1,474,185 $ 0 (1) As of December 31, 2019 , there were no loans in this category accruing interest. (2) For additional information regarding the Company’s policies for accruing interest on loans, see Note 2 . December 31, 2018 Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due(1) Total Loans Non-Accrual Status(2) (in thousands) Commercial mortgage loans $ 1,301,999 $ 0 $ 0 $ 0 $ 1,301,999 $ 0 Agricultural property loans 54,375 0 0 0 54,375 0 Total $ 1,356,374 $ 0 $ 0 $ 0 $ 1,356,374 $ 0 (1) As of December 31, 2018 , there were no loans in this category accruing interest. (2) For additional information regarding the Company’s policies for accruing interest on loans, see Note 2 . For the years ended December 31, 2019 and 2018 , there were no commercial mortgage and other loans acquired, other than those through direct origination, and there were $206 million and $96 million , respectively, of commercial mortgage and other loans sold. Other Invested Assets The following table sets forth the composition of “Other invested assets,” as of the dates indicated: December 31, 2019 2018 (in thousands) LPs/LLCs: Equity method: Private equity $ 23,414 $ 23,844 Hedge funds 273,615 179,014 Real estate-related 166,492 94,738 Subtotal equity method 463,521 297,596 Fair value: Private equity 4,115 4,142 Hedge funds 194 263 Real estate-related 6,181 3,562 Subtotal fair value 10,490 7,967 Total LPs/LLCs 474,011 305,563 Derivative instruments 2 42,978 Total other invested assets $ 474,013 $ 348,541 As of both December 31, 2019 and 2018 , the Company had no significant equity method investments. Net Investment Income The following table sets forth “Net investment income” by investment type, for the periods indicated: Years Ended December 31, 2019 2018 2017 (in thousands) Fixed maturities, available-for-sale $ 389,165 $ 317,726 $ 332,148 Fixed maturities, trading 10,080 5,184 4,360 Equity securities, at fair value 568 678 567 Commercial mortgage and other loans 51,628 51,040 48,598 Policy loans 630 737 1,069 Short-term investments and cash equivalents 85,084 28,645 31,505 Other invested assets 34,422 13,733 20,626 Gross investment income 571,577 417,743 438,873 Less: investment expenses (20,029 ) (14,935 ) (16,064 ) Net investment income $ 551,548 $ 402,808 $ 422,809 The carrying value of non-income producing assets included $4.1 million in available-for-sale fixed maturities as of December 31, 2019 . Non-income producing assets represent investments that had not produced income for the twelve months preceding December 31, 2019 . Realized Investment Gains (Losses), Net The following table sets forth “Realized investment gains (losses), net” by investment type, for the periods indicated: Years Ended December 31, 2019 2018 2017 (in thousands) Fixed maturities(1) $ (3,931 ) $ (83,731 ) $ (3,177 ) Commercial mortgage and other loans (753 ) 128 (840 ) LPs/LLCs 0 0 (39 ) Derivatives (2,677,559 ) 967,503 (801,429 ) Other invested assets 164 123 0 Short-term investments and cash equivalents 759 50 85 Realized investment gains (losses), net $ (2,681,320 ) $ 884,073 $ (805,400 ) (1) Includes fixed maturity securities classified as available-for-sale and excludes fixed maturity securities classified as trading. Net Unrealized Gains (Losses) on Investments within AOCI The following table sets forth net unrealized gains (losses) on investments, as of the dates indicated: December 31, 2019 2018 2017 (in thousands) Fixed maturity securities, available-for-sale — with OTTI $ 14,309 $ (3,334 ) $ 12,311 Fixed maturity securities, available-for-sale — all other 722,310 (411,458 ) (46,791 ) Equity securities, available-for-sale(1) 0 0 4 Derivatives designated as cash flow hedges(2) (287 ) (3,849 ) (25,851 ) Affiliated notes 598 658 829 Other investments 0 1,074 86 Net unrealized gains (losses) on investments $ 736,930 $ (416,909 ) $ (59,412 ) (1) Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded within “Asset administration fees and other income (loss).” (2) For more information on cash flow hedges, see Note 4 . Repurchase Agreements and Securities Lending In the normal course of business, the Company sells securities under agreements to repurchase and enters into securities lending transactions. As of both December 31, 2019 and 2018 , the Company had no repurchase agreements. The following table sets forth the composition of “Cash collateral for loaned securities,” which represents the liability to return cash collateral received for the following types of securities loaned, as of the dates indicated: December 31, 2019 December 31, 2018 Remaining Contractual Maturities of the Agreements Remaining Contractual Maturities of the Agreements Overnight & Continuous Up to 30 Days Total Overnight & Continuous Up to 30 Days Total (in thousands) Foreign government bonds $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 U.S. public corporate securities 0 0 0 384 0 384 Total cash collateral for loaned securities(1) $ 0 $ 0 $ 0 $ 384 $ 0 $ 384 (1) The Company did no t have agreements with remaining contractual maturities of thirty days or greater, as of the dates indicated. Securities Pledged, Restricted Assets and Special Deposits The Company pledges as collateral investment securities it owns to unaffiliated parties through certain transactions, including securities lending, securities sold under agreements to repurchase, collateralized borrowings and postings of collateral with derivative counterparties. The following table sets forth the carrying value of investments pledged to third parties and the carrying amount of the associated liabilities supported by the pledged collateral, as of the dates indicated: December 31, 2019 2018 (in thousands) Pledged collateral: Fixed maturity securities, available-for-sale $ 0 $ 365 Total securities pledged $ 0 $ 365 Liabilities supported by the pledged collateral: Cash collateral for loaned securities $ 0 $ 384 Total liabilities supported by the pledged collateral $ 0 $ 384 In the normal course of its business activities, the Company accepts collateral that can be sold or repledged. The primary sources of this collateral are securities purchased under agreements to resell. As of December 31, 2019 and 2018 , there was $302 million and $675 million , respectively, of such collateral. As of December 31, 2019 and 2018 , there were available-for-sale fixed maturities of $10.7 million and $8.4 million , respectively, on deposit with governmental authorities or trustees as required by certain insurance laws. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | 4. DERIVATIVE INSTRUMENTS Types of Derivative Instruments and Derivative Strategies Interest Rate Contracts Interest rate swaps, options and futures are used by the Company to reduce risks from changes in interest rates, manage interest rate exposures arising from mismatches between assets and liabilities and to hedge against changes in their values it owns or anticipates acquiring or selling. Swaps may be attributed to specific assets or liabilities or to a portfolio of assets or liabilities. Under interest rate swaps, the Company agrees with counterparties to exchange, at specified intervals, the difference between fixed-rate and floating-rate interest amounts calculated by reference to an agreed upon notional principal amount. The Company also uses interest rate swaptions, caps and floors to manage interest rate risk. A swaption is an option to enter into a swap with a forward starting effective date. The Company pays a premium for purchased swaptions and receives a premium for written swaptions. In an interest rate cap, the buyer receives payments at the end of each period in which the interest rate exceeds the agreed strike price. Similarly, in an interest rate floor, the buyer receives payments at the end of each period in which the interest rate is below the agreed strike price. Swaptions, caps and floors are included in interest rate options. In standardized exchange-traded interest rate futures transactions, the Company purchases or sells a specified number of contracts, the values of which are determined by the daily market values of underlying referenced investments. The Company enters into exchange-traded futures with regulated futures commission's merchants who are members of a trading exchange. Equity Contracts Equity options, total return swaps, and futures are used by the Company to manage its exposure to the equity markets which impacts the value of assets and liabilities it owns or anticipates acquiring or selling. Equity index options are contracts which will settle in cash based on differentials in the underlying indices at the time of exercise and the strike price. The Company uses combinations of purchases and sales of equity index options to hedge the effects of adverse changes in equity indices within a predetermined range. Total return swaps are contracts whereby the Company agrees with counterparties to exchange, at specified intervals, the difference between the return on an asset (or market index) and London Inter-Bank Offered Rate ("LIBOR") plus an associated funding spread based on a notional amount. The Company generally uses total return swaps to hedge the effect of adverse changes in equity indices. In standardized exchange-traded equity futures transactions, the Company purchases or sells a specified number of contracts, the values of which are determined by the daily market values underlying referenced equity indices. The Company enters into exchange-traded futures with regulated futures commission's merchants who are members of a trading exchange. Foreign Exchange Contracts Currency derivatives, including currency swaps and forwards, are used by the Company to reduce risks from changes in currency exchange rates with respect to investments denominated in foreign currencies that the Company either holds or intends to acquire or sell. Under currency forwards, the Company agrees with counterparties to deliver a specified amount of an identified currency at a specified future date. Typically, the price is agreed upon at the time of the contract and payment for such a contract is made at the specified future date. The Company executes forward sales of the hedged currency in exchange for U.S. dollars at a specified exchange rate. The maturities of these forwards correspond with the future periods in which the non-U.S. dollar-denominated earnings are expected to be generated. Under currency swaps, the Company agrees with counterparties to exchange, at specified intervals, the difference between one currency and another at an exchange rate and calculated by reference to an agreed principal amount. Generally, the principal amount of each currency is exchanged at the beginning and termination of the currency swap by each party. Credit Contracts The Company writes credit protection to gain exposure similar to investment in public fixed maturity cash instruments. With these credit derivatives the Company sells credit protection on a single name reference, or certain index reference, and in return receives a quarterly premium. This premium or credit spread generally corresponds to the difference between the yield on the referenced name (or an index's referenced names) public fixed maturity cash instruments and swap rates, at the time the agreement is executed. If there is an event of default by the referenced name or one of the referenced names in the index, as defined by the agreement, then the Company is obligated to pay the referenced amount of the contract to the counterparty and receive in return the referenced defaulted security or similar security or (in the case of a credit default index) pay the referenced amount less the auction recovery rate. In addition to selling credit protection, the Company purchases credit protection using credit derivatives in order to hedge specific credit exposures in the Company’s investment portfolio. Embedded Derivatives The Company sells certain products (for example, variable annuities and fixed indexed annuities) which may include features that are accounted for as embedded derivatives. Effective April 1, 2016, the Company assumed variable annuities living benefit guarantees from Pruco Life, excluding PLNJ business. See Note 1 for additional information on the change to the reinsurance agreements. Additionally, the Company reinsured the majority of its New York business to an affiliate, Prudential Insurance, as a result of surrendering its New York license, effective December 31, 2015. See Note 1 for additional information on these reinsurance agreements. These embedded derivatives and certain elements of the associated reinsurance agreements, also accounted for as derivatives, are carried at fair value and marked to market through “Realized investment gains (losses), net” based on the change in value of the underlying contractual guarantees, which are determined using valuation models, as described in Note 5 . Primary Risks Managed by Derivatives The table below provides a summary of the gross notional amount and fair value of derivative contracts by the primary underlying risks, excluding embedded derivatives and associated reinsurance recoverables. Many derivative instruments contain multiple underlying risks. The fair value amounts below represent the value of derivative contracts prior to taking into account the netting effects of master netting agreements and cash collateral. December 31, 2019 December 31, 2018 Primary Underlying Risk/Instrument Type Gross Notional Fair Value Gross Notional Fair Value Assets Liabilities Assets Liabilities (in thousands) Derivatives Designated as Hedge Accounting Instruments: Currency/Interest Rate Foreign Currency Swaps $ 1,172,899 $ 39,019 $ (26,511 ) $ 768,075 $ 33,348 $ (21,794 ) Total Derivatives Designated as Hedge Accounting Instruments $ 1,172,899 $ 39,019 $ (26,511 ) $ 768,075 $ 33,348 $ (21,794 ) Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate Interest Rate Futures $ 3,857,700 $ 638 $ (5,872 ) $ 908,100 $ 4,380 $ (664 ) Interest Rate Swaps 88,557,425 6,598,625 (1,997,944 ) 82,172,825 3,344,033 (1,395,270 ) Interest Rate Options 12,583,000 283,386 (172,085 ) 19,255,000 139,765 (245,523 ) Interest Rate Forwards 959,772 24,487 (4,185 ) 1,713,947 56,562 (1,976 ) Foreign Currency Foreign Currency Forwards 16,683 0 (394 ) 19,467 287 (27 ) Currency/Interest Rate Foreign Currency Swaps 234,767 11,482 (663 ) 231,245 11,659 (2,850 ) Equity Equity Futures 1,191,237 0 (2,638 ) 860,718 0 (6,629 ) Total Return Swaps 16,314,165 36,692 (573,957 ) 14,456,836 986,130 (53,235 ) Equity Options 12,866,043 329,722 (422,700 ) 26,861,807 271,630 (412,821 ) Total Derivatives Not Qualifying as Hedge Accounting Instruments $ 136,580,792 $ 7,285,032 $ (3,180,438 ) $ 146,479,945 $ 4,814,446 $ (2,118,995 ) Total Derivatives (1)(2) $ 137,753,691 $ 7,324,051 $ (3,206,949 ) $ 147,248,020 $ 4,847,794 $ (2,140,789 ) (1) Excludes embedded derivatives and associated reinsurance recoverables which contain multiple underlying risks. The fair value of these embedded derivatives was a net liability of $11,823 million and $8,332 million as of December 31, 2019 and 2018 , respectively included in “Future policy benefits” and $197 million and $42 million as of December 31, 2019 and 2018 , respectively included in “Policyholders’ account balances". Other assets included $8 million and $0 million as of December 31, 2019 and 2018 , respectively. The fair value of the related reinsurance, included in "Reinsurance recoverables" and/or "Reinsurance payables" was an asset of $350 million and $240 million as of December 31, 2019 and 2018 , respectively. (2) Recorded in “Other invested assets”, “Other liabilities”, and "Payables to parent and affiliates" on the Statements of Financial Position. Offsetting Assets and Liabilities The following table presents recognized derivative instruments (excluding embedded derivatives and associated reinsurance recoverables), and repurchase and reverse repurchase agreements, that are offset in the Statements of Financial Position, and/or are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in the Statements of Financial Position. December 31, 2019 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statement of Financial Position Net Amounts Presented in the Statement of Financial Position Financial Instruments/ Collateral(1) Net Amount (in thousands) Offsetting of Financial Assets: Derivatives(1) $ 7,324,051 $ (7,324,049 ) $ 2 $ 0 $ 2 Securities purchased under agreements to resell 302,000 0 302,000 (302,000 ) 0 Total Assets $ 7,626,051 $ (7,324,049 ) $ 302,002 $ (302,000 ) $ 2 Offsetting of Financial Liabilities: Derivatives(1) $ 3,206,949 $ (3,053,132 ) $ 153,817 $ (820 ) $ 152,997 Securities sold under agreements to repurchase 0 0 0 0 0 Total Liabilities $ 3,206,949 $ (3,053,132 ) $ 153,817 $ (820 ) $ 152,997 December 31, 2018 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statement of Financial Position Net Amounts Presented in the Statement of Financial Position Financial Instruments/ Collateral(1) Net Amount (in thousands) Offsetting of Financial Assets: Derivatives(1) $ 4,847,794 $ (4,804,816 ) $ 42,978 $ 0 $ 42,978 Securities purchased under agreements to resell 675,000 0 675,000 (675,000 ) 0 Total Assets $ 5,522,794 $ (4,804,816 ) $ 717,978 $ (675,000 ) $ 42,978 Offsetting of Financial Liabilities: Derivatives(1) $ 2,140,789 $ (2,134,160 ) $ 6,629 $ (6,629 ) $ 0 Securities sold under agreements to repurchase 0 0 0 0 0 Total Liabilities $ 2,140,789 $ (2,134,160 ) $ 6,629 $ (6,629 ) $ 0 (1) Amounts exclude the excess of collateral received/pledged from/to the counterparty. For information regarding the rights of offset associated with the derivative assets and liabilities in the table above see “Credit Risk” below and Note 14 . For securities purchased under agreements to resell and securities sold under agreements to repurchase, the Company monitors the value of the securities and maintains collateral, as appropriate, to protect against credit exposure. Where the Company has entered into repurchase and resale agreements with the same counterparty, in the event of default, the Company would generally be permitted to exercise rights of offset. For additional information on the Company’s accounting policy for securities repurchase and resale agreements, see Note 2 to the Financial Statements. Cash Flow Hedges The primary derivative instruments used by the Company in its cash flow hedge accounting relationships are currency swaps. These instruments are only designated for hedge accounting in instances where the appropriate criteria are met. The Company does not use futures, options, credit, and equity derivatives in any of its cash flow hedge accounting relationships. The following tables provide the financial statement classification and impact of derivatives used in qualifying and non-qualifying hedge relationships, excluding the offset of the hedged item in an effective hedge relationship. Year Ended December 31, 2019 Realized Investment Gains (Losses) Net Investment Income Other Income AOCI(1) (in thousands) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ (1,257 ) $ 12,104 $ (3,793 ) $ 3,520 Total cash flow hedges (1,257 ) 12,104 (3,793 ) 3,520 Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate 3,309,573 0 0 0 Currency (153 ) 0 0 0 Currency/Interest Rate 11,964 0 15 0 Credit 1,775 0 0 0 Equity (3,730,006 ) 0 0 0 Embedded Derivatives (2,269,455 ) 0 0 0 Total Derivatives Not Qualifying as Hedge Accounting Instruments (2,676,302 ) 0 15 0 Total $ (2,677,559 ) $ 12,104 $ (3,778 ) $ 3,520 Year Ended December 31, 2018(2) Realized Investment Gains (Losses) Net Investment Income Other Income AOCI(1) (in thousands) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ (845 ) $ 8,285 $ 13,321 $ 22,002 Total cash flow hedges (845 ) 8,285 13,321 22,002 Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate (1,021,687 ) 0 0 0 Currency 1,022 0 0 0 Currency/Interest Rate 21,888 0 91 0 Credit 0 0 0 0 Equity 995,958 0 0 0 Embedded Derivatives 971,167 0 0 0 Total Derivatives Not Qualifying as Hedge Accounting Instruments 968,348 0 91 0 Total $ 967,503 $ 8,285 $ 13,412 $ 22,002 Year Ended December 31, 2017(2) Realized Investment Gains (Losses) Net Investment Income Other Income AOCI(1) (in thousands) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ 3,052 $ 6,152 $ (11,043 ) $ (37,596 ) Total cash flow hedges 3,052 6,152 (11,043 ) (37,596 ) Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate 550,797 0 0 0 Currency (454 ) 0 0 0 Currency/Interest Rate (33,225 ) 0 (183 ) 0 Credit 0 0 0 0 Equity (2,000,297 ) 0 0 0 Embedded Derivatives 678,698 0 0 0 Total Derivatives Not Qualifying as Hedge Accounting Instruments (804,481 ) 0 (183 ) 0 Total $ (801,429 ) $ 6,152 $ (11,226 ) $ (37,596 ) (1) Net change in AOCI. (2) Prior period amounts have been updated to conform to current period presentation. Presented below is a rollforward of current period cash flow hedges in AOCI before taxes: (in thousands) Balance, December 31, 2016 $ 11,745 Amount recorded in AOCI Currency/Interest Rate (39,434 ) Total amount recorded in AOCI (39,434 ) Amount reclassified from AOCI to income Currency/Interest Rate 1,838 Total amount reclassified from AOCI to income 1,838 Balance, December 31, 2017 $ (25,851 ) Amount recorded in AOCI Currency/Interest Rate 42,763 Total amount recorded in AOCI 42,763 Amount reclassified from AOCI to income Currency/Interest Rate (20,761 ) Total amount reclassified from AOCI to income (20,761 ) Balance, December 31, 2018 $ (3,849 ) Cumulative-effect adjustment from the adoption of ASU 2017-12(1) 42 Amount recorded in AOCI Currency/Interest Rate 10,574 Total amount recorded in AOCI 10,574 Amount reclassified from AOCI to income Currency/Interest Rate (7,054 ) Total amount reclassified from AOCI to income (7,054 ) Balance, December 31, 2019 $ (287 ) (1) See Note 2 for details. The changes in fair value of cash flow hedges are deferred in AOCI and are included in “Net unrealized investment gains (losses)” in the Statements of Operations and Comprehensive Income (Loss); these amounts are then reclassified to earnings when the hedged item affects earnings. Using December 31, 2019 values, it is estimated that a pre-tax gain of approximately $16 million is expected to be reclassified from AOCI to earnings during the subsequent twelve months ending December 31, 2020 . The exposures the Company is hedging with these qualifying cash flow hedges include the variability of the payment or receipt of interest or foreign currency amounts on existing financial instruments. There were no material amounts reclassified from AOCI into earnings relating to instances in which the Company discontinued cash flow hedge accounting because the forecasted transaction did not occur by the anticipated date or within the additional time period permitted by the authoritative guidance for the accounting for derivatives and hedging. Credit Derivatives The Company has no exposure from credit derivative positions where it has written or purchased credit protection as of December 31, 2019 and 2018 . Credit Risk The Company is exposed to credit-related losses in the event of non-performance by counterparty to financial derivative transactions with a positive fair value. The Company manages credit risk by entering into derivative transactions with its affiliate, Prudential Global Funding, LLC (“PGF”), related to its OTC derivatives. PGF, in turn, manages its credit risk by: (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreement, as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review. |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets and Liabilities | FAIR VALUE OF ASSETS AND LIABILITIES Fair Value Measurement – Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative fair value guidance establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows: Level 1 - Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets or liabilities. The Company’s Level 1 assets and liabilities primarily include certain cash equivalents, equity securities, and derivative contracts that trade on an active exchange market. Level 2 - Fair value is based on significant inputs, other than quoted prices included in Level 1, that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets and liabilities, quoted market prices in markets that are not active for identical or similar assets or liabilities, and other market observable inputs. The Company’s Level 2 assets and liabilities include: fixed maturities (corporate public and private bonds, most government securities, certain asset-backed and mortgage-backed securities, etc.), certain equity securities (mutual funds, which do not trade in active markets because they are not publicly available), certain short-term investments, certain cash equivalents and certain OTC derivatives. Level 3 - Fair value is based on at least one significant unobservable input for the asset or liability. The assets and liabilities in this category may require significant judgment or estimation in determining the fair value. The Company’s Level 3 assets and liabilities primarily include: certain private fixed maturities and equity securities, certain manually priced fixed maturities, certain highly structured OTC derivative contracts and embedded derivatives resulting from reinsurance or certain products with guaranteed benefits. Assets and Liabilities by Hierarchy Level – The tables below present the balances of assets and liabilities reported at fair value on a recurring basis, as of the dates indicated. As of December 31, 2019 Level 1 Level 2 Level 3 Netting(1) Total (in thousands) Fixed maturities, available-for-sale: U.S Treasury securities and obligations of U.S. government authorities and agencies $ 0 $ 7,109,277 $ 10,547 $ 0 $ 7,119,824 Obligations of U.S. states and their political subdivisions 0 259,682 0 0 259,682 Foreign government bonds 0 222,884 0 0 222,884 U.S. corporate public securities 0 1,732,632 8,044 0 1,740,676 U.S. corporate private securities 0 1,155,464 51,875 0 1,207,339 Foreign corporate public securities 0 337,800 187 0 337,987 Foreign corporate private securities 0 1,169,324 44,161 0 1,213,485 Asset-backed securities(2) 0 425,613 18,825 0 444,438 Commercial mortgage-backed securities 0 578,289 0 0 578,289 Residential mortgage-backed securities 0 77,761 0 0 77,761 Subtotal 0 13,068,726 133,639 0 13,202,365 Fixed maturities, trading 0 378,734 4,464 0 383,198 Equity securities 5,314 46,942 5,247 0 57,503 Short-term investments 0 260,354 0 0 260,354 Cash equivalents 150,631 1,654,974 0 0 1,805,605 Other invested assets(3) 639 7,323,412 0 (7,324,049 ) 2 Other assets 0 0 8,059 0 8,059 Reinsurance recoverables 0 47,006 302,814 0 349,820 Receivables from parent and affiliates 0 2,573 0 0 2,573 Subtotal excluding separate account assets 156,584 22,782,721 454,223 (7,324,049 ) 16,069,479 Separate account assets(4) 0 32,665,431 0 0 32,665,431 Total assets $ 156,584 $ 55,448,152 $ 454,223 $ (7,324,049 ) $ 48,734,910 Future policy benefits(5) $ 0 $ 0 $ 11,822,998 $ 0 $ 11,822,998 Policyholders' account balances 0 0 196,892 0 196,892 Payables to parent and affiliates 0 3,198,440 0 (3,052,493 ) 145,947 Other liabilities 8,509 260 0 (639 ) 8,130 Total liabilities $ 8,509 $ 3,198,700 $ 12,019,890 $ (3,053,132 ) $ 12,173,967 As of December 31, 2018 Level 1 Level 2 Level 3 Netting (1) Total (in thousands) Fixed maturities, available-for-sale: U.S Treasury securities and obligations of U.S. government authorities and agencies $ 0 $ 4,875,959 $ 8,132 $ 0 $ 4,884,091 Obligations of U.S. states and their political subdivisions 0 131,164 0 0 131,164 Foreign government bonds 0 199,636 0 0 199,636 U.S. corporate public securities 0 1,473,973 0 0 1,473,973 U.S. corporate private securities 0 1,008,632 54,321 0 1,062,953 Foreign corporate public securities 0 291,086 0 0 291,086 Foreign corporate private securities 0 781,101 31,131 0 812,232 Asset-backed securities(2) 0 495,908 9,336 0 505,244 Commercial mortgage-backed securities 0 361,880 0 0 361,880 Residential mortgage-backed securities 0 49,414 0 0 49,414 Subtotal 0 9,668,753 102,920 0 9,771,673 Fixed maturities, trading 0 289,752 0 0 289,752 Equity securities 4,896 12 5,705 0 10,613 Short-term investments 0 29,818 0 0 29,818 Cash equivalents 1,098,903 2,593,456 0 0 3,692,359 Other invested assets(3) 4,380 4,843,414 0 (4,804,816 ) 42,978 Other assets 0 0 0 0 0 Reinsurance recoverables 0 0 239,911 0 239,911 Receivables from parent and affiliates 0 37,193 0 0 37,193 Subtotal excluding separate account assets 1,108,179 17,462,398 348,536 (4,804,816 ) 14,114,297 Separate account assets(4) 0 31,210,346 0 0 31,210,346 Total assets $ 1,108,179 $ 48,672,744 $ 348,536 $ (4,804,816 ) $ 45,324,643 Future policy benefits(5) $ 0 $ 0 $ 8,332,474 $ 0 $ 8,332,474 Policyholders' account balances 0 0 42,350 0 42,350 Payables to parent and affiliates 0 2,133,496 0 (2,133,496 ) 0 Other liabilities 7,293 0 0 (664 ) 6,629 Total liabilities $ 7,293 $ 2,133,496 $ 8,374,824 $ (2,134,160 ) $ 8,381,453 (1) “Netting” amounts represent cash collateral of $4,271 million and $2,671 million as of December 31, 2019 and 2018 , respectively. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) Other invested assets excluded from the fair value hierarchy include certain hedge funds, private equity funds and other funds for which fair value is measured at net asset value ("NAV") per share (or its equivalent) as a practical expedient. At December 31, 2019 and 2018 , the fair values of such investments were $ 10.5 million and $ 8.0 million , respectively. (4) Separate account assets represent segregated funds that are invested for certain customers. Investment risks associated with market value changes are borne by the customers, except to the extent of minimum guarantees made by the Company with respect to certain accounts. Separate account liabilities are not included in the above table as they are reported at contract value and not fair value in Statements of Financial Position. (5) As of December 31, 2019 , the net embedded derivative liability position of $11,823 million includes $583 million of embedded derivatives in an asset position and $12,406 million of embedded derivatives in a liability position. As of December 31, 2018 , the net embedded derivative liability position of $8,332 million includes $625 million of embedded derivatives in an asset position and $8,957 million of embedded derivatives in a liability position. The methods and assumptions the Company uses to estimate the fair value of assets and liabilities measured at fair value on a recurring basis are summarized below. Fixed Maturity Securities – The fair values of the Company’s public fixed maturity securities are generally based on prices obtained from independent pricing services. Prices for each security are generally sourced from multiple pricing vendors, and a vendor hierarchy is maintained by asset type based on historical pricing experience and vendor expertise. The Company ultimately uses the price from the pricing service highest in the vendor hierarchy based on the respective asset type. The pricing hierarchy is updated for new financial products and recent pricing experience with various vendors. Consistent with the fair value hierarchy described above, securities with validated quotes from pricing services are generally reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs. Typical inputs used by these pricing services include but are not limited to reported trades, benchmark yields, issuer spreads, bids, offers, and/or estimated cash flow, prepayment speeds and default rates. If the pricing information received from third-party pricing services is deemed not reflective of market activity or other inputs observable in the market, the Company may challenge the price through a formal process with the pricing service or classify the securities as Level 3. If the pricing service updates the price to be more consistent with the presented market observations, the security remains within Level 2. Internally-developed valuations or indicative broker quotes are also used to determine fair value in circumstances where vendor pricing is not available, or where the Company ultimately concludes that pricing information received from the independent pricing services is not reflective of market activity. If the Company concludes the values from both pricing services and brokers are not reflective of market activity, it may override the information with an internally developed valuation. As of December 31, 2019 and 2018 , overrides on a net basis were not material. Pricing service overrides, internally-developed valuations and indicative broker quotes are generally included in Level 3 in the fair value hierarchy. The Company conducts several specific price monitoring activities. Daily analyses identify price changes over predetermined thresholds defined at the financial instrument level. Various pricing integrity reports are reviewed on a daily and monthly basis to determine if pricing is reflective of market activity or if it would warrant any adjustments. Other procedures performed include, but are not limited to, reviews of third-party pricing services methodologies, reviews of pricing trends, and back testing. The fair values of private fixed maturities, which are originated by internal private asset managers, are primarily determined using discounted cash flow models. These models primarily use observable inputs that include Treasury or similar base rates plus estimated credit spreads to value each security. The credit spreads are obtained through a survey of private market intermediaries who are active in both primary and secondary transactions, and consider, among other factors, the credit quality and the reduced liquidity associated with private placements. Internal adjustments are made to reflect variation in observed sector spreads. Since most private placements are valued using standard market observable inputs and inputs derived from, or corroborated by, market observable data including, but not limited to observed prices and spreads for similar publicly or privately traded issues, they have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model may incorporate significant unobservable inputs, which reflect the Company’s own assumptions about the inputs that market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the price of a security, a Level 3 classification is made. Equity Securities – Equity securities consist principally of investments in common of publicly traded companies, privately traded securities, as well as mutual fund shares. The fair values of most publicly traded equity securities are based on quoted market prices in active markets for identical assets and are classified within Level 1 in the fair value hierarchy. Estimated fair values for most privately traded equity securities are determined using discounted cash flow, earnings multiple and other valuation models that require a substantial level of judgment around inputs and therefore are classified within Level 3. The fair values of mutual fund shares that transact regularly (but do not trade in active markets because they are not publicly available) are based on transaction prices of identical fund shares and are classified within Level 2 in the fair value hierarchy. Derivative Instruments – Derivatives are recorded at fair value either as assets, within "Other invested assets", or as liabilities, within “Payables to parent and affiliates” or "Other liabilities", except for embedded derivatives which are recorded with the associated host contract. The fair values of derivative contracts can be affected by changes in interest rates, foreign exchange rates, credit spreads, market volatility, expected returns, NPR, liquidity and other factors. The Company's exchange-traded futures and options include treasury and equity futures. Exchange-traded futures and options are valued using quoted prices in active markets and are classified within Level 1 in the fair value hierarchy. The majority of the Company’s derivative positions are traded in the OTC derivative market and are classified within Level 2 in the fair value hierarchy. OTC derivatives classified within Level 2 are valued using models that utilize actively quoted or observable market input values from external market data providers, third-party pricing vendors and/or recent trading activity. The Company’s policy is to use mid-market pricing in determining its best estimate of fair value. The fair values of most OTC derivatives, including interest rate and cross-currency swaps, currency forward contracts and single name credit default swaps are determined using discounted cash flow models. The fair values of European style option contracts are determined using Black-Scholes option pricing models. These models’ key inputs include the contractual terms of the respective contract, along with significant observable inputs, including interest rates, currency rates, credit spreads, equity prices, index dividend yields, NPR, volatility and other factors. The Company’s cleared interest rate swaps and credit derivatives linked to an index are valued using models that utilize actively quoted or observable market inputs, including Overnight Indexed Swap discount rates, obtained from external market data providers, third-party pricing vendors, and/or recent trading activity. These derivatives are classified as Level 2 in the fair value hierarchy. Cash Equivalents and Short-Term Investments – Cash equivalents and short-term investments include money market instruments and other highly liquid debt instruments. Certain money market instruments are valued using unadjusted quoted prices in active markets that are accessible for identical assets and are primarily classified as Level 1. The remaining instruments in this category are generally fair valued based on market observable inputs and these investments have primarily been classified within Level 2. Separate Account Assets – Separate account assets include mutual fixed maturity securities, treasuries, equity securities, mutual funds and commercial mortgage loans for which values are determined consistent with similar instruments described above under “Fixed Maturity Securities” and “Equity Securities”. Receivables from Parent and Affiliates – Receivables from parent and affiliates carried at fair value include affiliated bonds within the Company’s legal entity where fair value is determined consistent with similar securities described above under “Fixed Maturity Securities” managed by affiliated asset managers. Reinsurance Recoverables – Reinsurance recoverables carried at fair value include the reinsurance of the Company’s living benefit guarantees on certain variable annuity contracts. These guarantees are accounted for as embedded derivatives and are recorded in “Reinsurance recoverables” or “Reinsurance payables” when fair value is in an asset or liability position, respectively. The methods and assumptions used to estimate the fair value are consistent with those described below in “Future policy benefits”. The reinsurance agreements covering these guarantees are derivatives with fair value determined in the same manner as the living benefit guarantee. Future Policy Benefits – The liability for future policy benefits is related to guarantees primarily associated with the living benefit features of certain variable annuity contracts, including guaranteed minimum accumulation benefits ("GMAB"), guaranteed withdrawal benefits ("GMWB") and guaranteed minimum income and withdrawal benefits ("GMIWB"), accounted for as embedded derivatives. The fair values of these liabilities are calculated as the present value of future expected benefit payments to customers less the present value of future expected rider fees attributable to the embedded derivative feature. This methodology could result in either a liability or contra-liability balance, given changing capital market conditions and various actuarial assumptions. Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management's judgment. The significant inputs to the valuation models for these embedded derivatives include capital market assumptions, such as interest rate levels and volatility assumptions, the Company’s market-perceived NPR, as well as actuarially determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Since many of these assumptions are unobservable and are considered to be significant inputs to the liability valuation, the liability included in future policy benefits has been reflected within Level 3 in the fair value hierarchy. Capital market inputs and actual policyholders’ account values are updated each quarter based on capital market conditions as of the end of the quarter, including interest rates, equity markets and volatility. In the risk neutral valuation, the initial swap curve drives the total return used to grow the policyholders’ account values. The Company’s discount rate assumption is based on the LIBOR swap curve adjusted for an additional spread relative to LIBOR to reflect NPR. Actuarial assumptions, including contractholder behavior and mortality, are reviewed at least annually, and updated based upon emerging experience, future expectations and other data, including any observable market data. These assumptions are generally updated annually unless a material change that the Company feels is indicative of a long-term trend is observed in an interim period. Policyholders' Account Balances - The liability for policyholders’ account balances is related to certain embedded derivative instruments associated with certain fixed annuity products that provide the policyholders with the index-linked interest credited over contract specified term periods. The fair values of these liabilities are determined using discounted cash flow models which include capital market assumptions such as interest rates and equity index volatility assumptions, the Company’s market-perceived NPR and actuarially determined assumptions for mortality, lapses and projected hedge costs. As there is no observable active market for these liabilities, the fair value is determined as the present value of account balances paid to policyholders in excess of contractually guaranteed minimums using option pricing techniques for index term periods that contain deposits as of the valuation date, and the expected option budget for future index term periods, where the terms of index crediting rates have not yet been declared by the company. Premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows are also incorporated in the fair value of these liabilities. The determination of these risk premiums requires the use of management’s judgment, and hence these liabilities are reflected within Level 3 in the fair value hierarchy. Capital market inputs, including interest rates and equity markets volatility, and actual policyholders’ account values are updated each quarter. Actuarial assumptions are reviewed at least annually and updated based upon emerging experience, future expectations and other data, including any observable market data. Aside from these annual updates, assumptions are generally updated only if a material change is observed in an interim period that the Company believes is indicative of a long-term trend. Quantitative Information Regarding Internally-Priced Level 3 Assets and Liabilities – The tables below present quantitative information on significant internally-priced Level 3 assets and liabilities. As of December 31, 2019 Fair Value Valuation Techniques Unobservable Inputs Minimum Maximum Weighted Average Impact of Increase in Input on Fair Value(1) (in thousands) Assets: Corporate securities(2) $ 17,149 Discounted cash flow Discount rate 4.79 % 20 % 8.66 % Decrease Market Comparables EBITDA multiples(3) 6.7 X 6.7 X 6.7 X Increase Reinsurance recoverables $ 302,814 Fair values are determined using the same unobservable inputs as future policy benefits. Liabilities: Future policy benefits(4) $ 11,822,998 Discounted cash flow Lapse rate(6) 1 % 18 % Decrease Spread over LIBOR(7) 0.10 % 1.23 % Decrease Utilization rate(8) 43 % 97 % Increase Withdrawal rate See table footnote (9) below. Mortality rate(10) 0 % 15 % Decrease Equity volatility curve 13 % 23 % Increase Policyholders' account balances(5) $ 196,892 Discounted cash flow Lapse rate(6) 1 % 42 % Decrease Spread over LIBOR(7) 0.10 % 1.23 % Decrease Equity volatility curve 6 % 25 % Increase As of December 31, 2018 Fair Value Valuation Techniques Unobservable Inputs Minimum Maximum Weighted Average Impact of Increase in Input on Fair Value (1) (in thousands) Assets: Corporate securities(2) $ 18,609 Discounted cash flow Discount rate 7 % 20 % 11.30 % Decrease Market Comparables EBITDA multiples(3) 6.7 X 6.7 X 6.7 X Increase Liquidation Liquidation value 41 % 41 % 41 % Increase Reinsurance recoverables $ 239,911 Fair values are determined using the same unobservable inputs as future policy benefits. Liabilities: Future policy benefits(4) $ 8,332,474 Discounted cash flow Lapse rate(6) 1 % 13 % Decrease Spread over LIBOR(7) 0.36 % 1.60 % Decrease Utilization rate(8) 50 % 97 % Increase Withdrawal rate See table footnote (9) below. Mortality rate(10) 0 % 15 % Decrease Equity volatility curve 18 % 22 % Increase (1) Conversely, the impact of a decrease in input would have the opposite impact on fair value as that presented in the table. (2) Includes assets classified as fixed maturities, available-for-sale and fixed maturities trading. (3) Represents multiples of earnings before interest, taxes, depreciation and amortization ("EBITDA"), and are amounts used when the Company has determined that market participants would use such multiples when valuing the investments. (4) Future policy benefits primarily represent general account liabilities for the living benefit features of the Company’s variable annuity contracts which are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than a weighted average, is a more meaningful representation of the unobservable inputs used in the valuation. (5) Policyholders’ account balances primarily represent general account liabilities for the index-linked interest credited on certain of the Company’s annuity products that are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than a weighted average, is a more meaningful representation of the unobservable inputs used in the valuation. (6) Lapse rates for contracts with living benefit guarantees are adjusted at the contract level based on the in-the-moneyness of the living benefit and reflect other factors, such as the applicability of any surrender charges. Lapse rates are reduced when contracts are more in-the-money. Lapse rates for contracts with index-linked crediting guarantees may be adjusted at the contract level based on the applicability of any surrender charges, product type, and market related factors such as interest rates. Lapse rates are also generally assumed to be lower for the period where surrender charges apply. For any given contract, lapse rates vary throughout the period over which cash flows are projected for the purposes of valuing these embedded derivatives. (7) The spread over the LIBOR swap curve represents the premium added to the proxy for the risk-free rate (LIBOR) to reflect the Company's estimates of rates that a market participant would use to value the living benefits in both the accumulation and payout phases and index-linked interest crediting guarantees. This spread includes an estimate of NPR, which is the risk that the obligation will not be fulfilled by the Company. NPR is primarily estimated by utilizing the credit spreads associated with issuing funding agreements, adjusted for any illiquidity risk premium. In order to reflect the financial strength ratings of the Company, credit spreads associated with funding agreements, as opposed to credit spread associated with debt, are utilized in developing this estimate because funding agreements, living benefit guarantees, and index-linked interest crediting guarantees are insurance liabilities and are therefore senior to debt. (8) The utilization rate assumption estimates the percentage of contracts that will utilize the benefit during the contract duration and begin lifetime withdrawals at various time intervals from contract inception. The remaining contractholders are assumed to either begin lifetime withdrawals immediately or never utilize the benefit. Utilization assumptions may vary by product type, tax status and age. The impact of changes in these assumptions is highly dependent on the product type, the age of the contractholder at the time of the sale, and the timing of the first lifetime income withdrawal. Range reflects the utilization rate for the vast majority of business with living benefits. (9) The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. These assumptions vary based on the age of the contractholder, the tax status of the contract and the duration since the contractholder began lifetime withdrawals. As of both December 31, 2019 and 2018 , the minimum withdrawal rate assumption is 78% and the maximum withdrawal rate assumption may be greater than 100% . The fair value of the liability will generally increase the closer the withdrawal rate is to 100% and decrease as the withdrawal rate moves further away from 100%. (10) The range reflects the mortality rates for the vast majority of business with living benefits, with policyholders ranging from 45 to 90 years old. While the majority of living benefits have a minimum age requirement, certain other contracts do not have an age restriction. This results in contractholders with mortality rates approaching 0% for certain benefits. Mortality rates may vary by product, age, and duration. A mortality improvement assumption is also incorporated into the overall mortality table. Interrelationships Between Unobservable Inputs – In addition to the sensitivities of fair value measurements to changes in each unobservable input in isolation, as reflected in the table above, interrelationships between these inputs may also exist, such that a change in one unobservable input may give rise to a change in another, or multiple, inputs. Examples of such interrelationships for significant internally-priced Level 3 assets and liabilities are as follows: Corporate Securities – The rate used to discount future cash flows reflects current risk-free rates plus credit and liquidity spread requirements that market participants would use to value an asset. The discount rate may be influenced by many factors, including market cycles, expectations of default, collateral, term and asset complexity. Each of these factors can influence discount rates, either in isolation, or in response to other factors. Future Policy Benefits – The Company expects efficient benefit utilization and withdrawal rates to generally be correlated with lapse rates. However, behavior is generally highly dependent on the facts and circumstances surrounding the individual contractholder, such as their liquidity needs or tax situation, which could drive lapse behavior independent of other contractholder behavior assumptions. To the extent more efficient contractholder behavior results in greater in-the-moneyness at the contract level, lapse rates may decline for those contracts. Similarly, to the extent that increases in equity volatility are correlated with overall declines in the capital markets, lapse rates may decline as contracts become more in-the-money. Changes in Level 3 Assets and Liabilities – The following tables describe changes in fair values of Level 3 assets and liabilities as of the dates indicated, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods. When a determination is made to classify assets and liabilities within Level 3, the determination is based on significance of the unobservable inputs in the overall fair value measurement. All transfers are based on changes in the observability of the valuation inputs, including the availability of pricing service information that the Company can validate. Transfers into Level 3 are generally the result of unobservable inputs utilized within valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company can validate. Year Ended December 31, 2019 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other(2) Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(3) (in thousands) Fixed maturities, available-for-sale: U.S. Government $ 8,132 $ 0 $ 2,415 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 10,547 $ 0 Corporate Securities(4) 85,452 (1,123 ) 61,563 0 0 (43,724 ) 0 4,655 (2,556 ) 104,267 (3,797 ) Structured Securities(5) 9,336 502 44,273 0 0 (5,259 ) 0 551 (30,578 ) 18,825 (2 ) Other assets: Fixed maturities, trading 0 (557 ) 0 0 0 0 0 5,021 0 4,464 (543 ) Equity securities 5,705 471 0 (929 ) 0 0 0 0 0 5,247 482 Other invested assets 0 0 0 0 0 0 0 0 0 0 0 Short-term investments 0 0 0 0 0 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 0 0 0 0 0 Other assets 0 441 7,618 0 0 0 0 0 0 8,059 441 Reinsurance recoverables 239,911 70,063 17,950 0 0 0 21,896 0 (47,006 ) 302,814 57,652 Liabilities: Future policy benefits (8,332,474 ) (2,409,958 ) 0 0 (1,080,566 ) 0 0 0 0 (11,822,998 ) (2,710,167 ) Policyholders' account balances(6) (42,350 ) (32,247 ) 0 0 (122,295 ) 0 0 0 0 (196,892 ) (22,699 ) Year Ended December 31, 2019 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, av |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Deferred Policy Acquisition Costs | DEFERRED POLICY ACQUISITION COSTS The balances of and changes in DAC as of and for the years ended December 31, are as follows: 2019 2018 2017 (in thousands) Balance, beginning of year $ 4,447,505 $ 4,596,565 $ 4,344,361 Capitalization of commissions, sales and issue expenses 412,627 372,996 277,586 Amortization-Impact of assumption and experience unlocking and true-ups 245,276 (113,534 ) 288,974 Amortization-All other (518,129 ) (476,261 ) (275,028 ) Change in unrealized investment gains and losses (131,596 ) 67,739 (39,328 ) Balance, end of year $ 4,455,683 $ 4,447,505 $ 4,596,565 |
Value of Business Acquired
Value of Business Acquired | 12 Months Ended |
Dec. 31, 2019 | |
Present Value of Future Insurance Profits [Abstract] | |
Value of Business Acquired | VALUE OF BUSINESS ACQUIRED The balances of and changes in VOBA as of and for the years ended December 31, are as follows: 2019 2018 2017 (in thousands) Balance, beginning of year $ 33,222 $ 35,109 $ 30,287 Amortization-Impact of assumption and experience unlocking and true-ups 2,093 1,485 10,035 Amortization-All other (6,376 ) (7,348 ) (7,422 ) Interest 1,778 1,983 2,001 Change in unrealized investment gains and losses (692 ) 1,993 208 Balance, end of year $ 30,025 $ 33,222 $ 35,109 The following table provides estimated future amortization, net of interest, for the periods indicated: 2020 2021 2022 2023 2024 (in thousands) Estimated future VOBA amortization $ 4,610 $ 3,976 $ 3,421 $ 2,926 $ 2,491 |
Policyholders' Liabilities
Policyholders' Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Liability for Future Policy Benefit, before Reinsurance [Abstract] | |
Policyholders' Liabilities | POLICYHOLDERS’ LIABILITIES Future Policy Benefits Future policy benefits at December 31 for the years indicated are as follows: 2019 2018 (in thousands) Life insurance – domestic $ 71 $ 74 Individual and group annuities and supplementary contracts(1) 1,087,060 1,021,854 Other contract liabilities(1) 11,845,330 8,347,058 Total future policy benefits $ 12,932,461 $ 9,368,986 (1) Includes assumed reinsurance business. Individual and group annuities and supplementary contract liabilities include reserves for life contingent immediate annuities and life contingent group annuities. Other contract liabilities include unearned premiums and certain other reserves for annuities and individual life products. Future policy benefits for domestic life insurance policies reflect in course of settlement amounts. Future policy benefits for individual and group annuities and supplementary contracts with life contingencies are generally equal to the present value of expected future payments. Assumptions as to mortality are based on the Company’s experience, industry data, and/or other factors, when the basis of the reserve is established. The interest rates used in the determination of the present values generally range from 0.0% to 8.3% , with less than 1.0% of the reserves based on an interest rate in excess of 8.0% . The Company’s liability for future policy benefits are primarily liabilities for guaranteed benefits related to certain long-duration life and annuity contracts. Liabilities for guaranteed benefits with embedded derivative features are primarily in "Other contract liabilities" in the table above. The remaining liabilities for guaranteed benefits are primarily reflected with the underlying contract. The interest rates used in the determination of the present values range from 1.9% to 3.3% . See Note 9 for additional information regarding liabilities for guaranteed benefits related to certain long-duration contracts. Premium deficiency reserves included in “Future policy benefits” are established, if necessary, when the liability for future policy benefits plus the present value of expected future gross premiums are determined to be insufficient to provide for expected future policy benefits and expenses. Premium deficiency reserves have been recorded for the individual annuity business, which consists of single premium immediate annuities with life contingencies. Policyholders’ Account Balances Policyholders’ account balances at December 31 for the years indicated are as follows: 2019 2018 (in thousands) Interest-sensitive life contracts $ 14,391 $ 15,049 Individual annuities(1) 5,716,052 4,729,973 Guaranteed interest accounts 449,916 608,574 Total policyholders’ account balances $ 6,180,359 $ 5,353,596 (1) Includes assumed reinsurance business from Pruco Life. Policyholders’ account balances represent an accumulation of account deposits plus credited interest less withdrawals, expenses and mortality charges, if applicable. These policyholders’ account balances also include provisions for benefits under non-life contingent payout annuities. Interest crediting rates range from 3.5% to 6.0% for interest-sensitive life contracts. Interest crediting rates for individual annuities range from 0.0% to 6.5% . Interest crediting rates for guaranteed interest accounts range from 0.1% to 5.8% |
Certain Long-Duration Contracts
Certain Long-Duration Contracts With Guarantees | 12 Months Ended |
Dec. 31, 2019 | |
Long-Duration Contracts, Assumptions Supporting Guarantee Obligations [Abstract] | |
Certain Long-Duration Contracts With Guarantees | CERTAIN LONG-DURATION CONTRACTS WITH GUARANTEES The Company issued variable annuity contracts through its separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contractholder. The Company also issued variable annuity contracts with general and separate account options where the Company contractually guarantees to the contractholder a return of no less than total deposits made to the contract adjusted for any partial withdrawals ("return of net deposits"). In certain of these variable annuity contracts, the Company also contractually guarantees to the contractholder a return of no less than (1) total deposits made to the contract adjusted for any partial withdrawals plus a minimum return ('minimum return"), and/or (2) the highest contract value on a specified date adjusted for any withdrawals (“contract value”). These guarantees include benefits that are payable in the event of death, annuitization or at specified dates during the accumulation period and withdrawal and income benefits payable during specified periods. The Company also issued annuity contracts with market value adjusted investment options (“MVAs”), which provide for a return of principal plus a fixed-rate of return if held to maturity, or, alternatively, a “market adjusted value” if surrendered prior to maturity or if funds are reallocated to other investment options. The market value adjustment may result in a gain or loss to the Company, depending on crediting rates or an indexed rate at surrender, as applicable. The Company also issued fixed deferred annuity contracts without MVA that have a guaranteed credited rate and annuity benefit. The assets supporting the variable portion of all variable annuities are carried at fair value and reported as “Separate account assets” with an equivalent amount reported as “Separate account liabilities.” Amounts assessed against the contractholders for mortality, administration, and other services are included within revenue in “Policy charges and fee income” and changes in liabilities for minimum guarantees are generally included in “Policyholders’ benefits” or "Realized investment gains (losses), net". For those guarantees of benefits that are payable in the event of death, the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, contract lapses and contractholder mortality. For guarantees of benefits that are payable at annuitization, the net amount at risk is generally defined as the present value of the minimum guaranteed annuity payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, timing of annuitization, contract lapses and contractholder mortality. For guarantees of benefits that are payable at withdrawal, the net amount at risk is generally defined as the present value of the minimum guaranteed withdrawal payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. For guarantees of accumulation balances, the net amount at risk is generally defined as the guaranteed minimum accumulation balance minus the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including equity market returns, interest rates, market volatility and contractholder behavior. The Company’s contracts with guarantees may offer more than one type of guarantee in each contract; therefore, the amounts listed may not be mutually exclusive. The liabilities related to the net amount at risk are reflected within “Future policy benefits.” As of December 31, 2019 and 2018 , the Company had the following guarantees associated with these contracts, by product and guarantee type: December 31, 2019 December 31, 2018 In the Event of Death(1) At Annuitization/ Accumulation(1)(2) In the Event of Death(1) At Annuitization/ Accumulation (1)(2) Annuity Contracts (in thousands) Return of net deposits Account value $ 120,240,930 N/A $ 106,779,202 N/A Net amount at risk $ 229,080 N/A $ 843,419 N/A Average attained age of contractholders 68 years N/A 67 years N/A Minimum return or contract value Account value $ 23,563,604 $ 129,812,105 $ 22,184,537 $ 115,822,894 Net amount at risk $ 2,254,621 $ 3,989,437 $ 4,322,406 $ 7,252,486 Average attained age of contractholders 70 years 69 years 70 years 68 years Average period remaining until earliest expected annuitization N/A 0 years N/A 0 years (1) Amounts include assumed reinsurance business. (2) Includes income and withdrawal benefits. Account balances of variable annuity contracts with guarantees were invested in separate account investment options as follows: December 31, 2019(1) December 31, 2018(1) (in thousands) Equity funds $ 82,506,787 $ 69,686,791 Bond funds 53,763,563 51,855,361 Money market funds 2,877,135 2,542,219 Total $ 139,147,485 $ 124,084,371 (1) Amounts include assumed reinsurance business. In addition to the amounts invested in separate account investment options above, $4.7 billion at December 31, 2019 and $4.9 billion at December 31, 2018 of account balances of variable annuity contracts with guarantees, inclusive of contracts with MVA features, were invested in general account investment options. For the years ended December 31, 2019 , 2018 and 2017 , there were no transfers of assets, other than cash, from the general account to any separate account, and accordingly no gains or losses recorded. Liabilities for Guarantee Benefits The table below summarizes the changes in general account liabilities for guarantees. The liabilities for GMDB and GMIB are included in “Future policy benefits” and the related changes in the liabilities are included in “Policyholders’ benefits.” GMAB, GMWB and GMIWB are accounted for as embedded derivatives and are recorded at fair value within “Future policy benefits.” Changes in the fair value of these derivatives, including changes in the Company’s own risk of non-performance, along with any fees attributed or payments made relating to the derivative are recorded in “Realized investment gains (losses), net.” See Note 5 for additional information regarding the methodology used in determining the fair value of these embedded derivatives. The Company maintains a portfolio of derivative investments that serve as a partial hedge of the risks associated with these products, for which the changes in fair value are also recorded in “Realized investment gains (losses), net.” This portfolio of derivative investments does not qualify for hedge accounting treatment under U.S. GAAP. GMDB GMAB/GMWB/ GMIWB GMIB Totals Variable Annuity (in thousands) Balance at December 31, 2016 $ 637,319 $ 7,707,333 $ 37,893 $ 8,382,545 Incurred guarantee benefits(1)(2) 29,605 444,569 (11,686 ) 462,488 Paid guarantee benefits(2) (57,053 ) 0 (3,798 ) (60,851 ) Change in unrealized investment gains and losses(2) 12,931 0 117 13,048 Balance at December 31, 2017 622,802 8,151,902 22,526 8,797,230 Incurred guarantee benefits(1)(2) 103,596 180,572 2,679 286,847 Paid guarantee benefits(2) (67,887 ) 0 (2,915 ) (70,802 ) Change in unrealized investment gains and losses(2) (20,108 ) 0 (230 ) (20,338 ) Balance at December 31, 2018 638,403 8,332,474 22,060 8,992,937 Incurred guarantee benefits(1)(2) 68,142 3,490,524 3,539 3,562,205 Paid guarantee benefits(2) (51,418 ) 0 (3,477 ) (54,895 ) Change in unrealized investment gains and losses(2) 26,377 0 274 26,651 Balance at December 31, 2019 $ 681,504 $ 11,822,998 $ 22,396 $ 12,526,898 (1) Incurred guarantee benefits include the portion of assessments established as additions to reserves as well as changes in estimates affecting the reserves. Also includes changes in the fair value of features considered to be derivatives. (2) Amounts include assumed reinsurance business. The GMDB and GMIB liability are established when associated assessments (which include all policy charges including charges for administration, mortality, expense, surrender, and other, regardless of how characterized) are recognized. This liability is established using current best estimate assumptions and is based on the ratio of the present value of total expected excess payments (e.g., payments in excess of account value) over the life of the contract divided by the present value of total expected assessments (i.e., benefit ratio). The liability equals the current benefit ratio multiplied by cumulative assessments recognized to date, plus interest, less cumulative excess payments to date. Similar to as described above for DAC, the reserves are subject to adjustments based on annual reviews of assumptions and quarterly adjustments for experience, including market performance. These adjustments reflect the impact on the benefit ratio of using actual historical experience from the issuance date to the balance sheet date plus updated estimates of future experience. The updated benefit ratio is then applied to all prior periods’ assessments to derive an adjustment to the reserve recognized through a benefit or charge to current period earnings. The GMAB features provide the contractholder with a guaranteed return of initial account value or an enhanced value if applicable. The most significant of the Company’s GMAB features are the guaranteed return option features, which includes an automatic rebalancing element that reduces the Company’s exposure to these guarantees. The GMAB liability is calculated as the present value of future expected payments in excess of the account balance less the present value of future expected rider fees attributable to the embedded derivative feature. The GMWB features provide the contractholder with access to a guaranteed remaining balance if the account value is reduced to zero through a combination of market declines and withdrawals. The guaranteed remaining balance is generally equal to the protected value under the contract, which is initially established as the greater of the account value or cumulative deposits when withdrawals commence, less cumulative withdrawals. The contractholder also has the option, after a specified time period, to reset the guaranteed remaining balance to the then-current account value, if greater. The contractholder accesses the guaranteed remaining balance through payments over time, subject to maximum annual limits. The GMWB liability is calculated as the present value of future expected payments to customers less the present value of future expected rider fees attributable to the embedded derivative feature. The GMIWB features, taken collectively, provide a contractholder two optional methods to receive guaranteed minimum payments over time, a “withdrawal” option or an “income” option. The withdrawal option (which was available under only one of the GMIWBs and is no longer offered) guarantees that a contractholder can withdraw an amount each year until the cumulative withdrawals reach a total guaranteed balance. The income option (which varies among the Company’s GMIWBs) in general guarantees the contractholder the ability to withdraw an amount each year for life (or for joint lives, in the case of any spousal version of the benefit) where such amount is equal to a percentage of a protected value under the benefit. The contractholder also has the potential to increase this annual amount, based on certain subsequent increases in account value that may occur. The GMIWB can be elected by the contractholder upon issuance of an appropriate deferred variable annuity contract or at any time following contract issue prior to annuitization. Certain GMIWB features include an automatic rebalancing element that reduces the Company’s exposure to these guarantees. The GMIWB liability is calculated as the present value of future expected payments to customers less the present value of future expected rider fees attributable to the embedded derivative feature. Sales Inducements The Company defers sales inducements and amortizes them over the anticipated life of the policy using the same methodology and assumptions used to amortize DAC. DSI is included in “Deferred sales inducements”. The Company has offered various types of sales inducements, including: (1) a bonus whereby the policyholder’s initial account balance is increased by an amount equal to a specified percentage of the customer’s initial deposit and (2) additional credits after a certain number of years a contract is held. Changes in DSI, reported as “Interest credited to policyholders’ account balances”, are as follows: Sales Inducements (in thousands) Balance at December 31, 2016 $ 978,823 Capitalization 1,551 Amortization - Impact of assumption and experience unlocking and true-ups 145,141 Amortization - All other (94,014 ) Change in unrealized investment gains and losses (10,715 ) Balance at December 31, 2017 1,020,786 Capitalization 2,888 Amortization - Impact of assumption and experience unlocking and true-ups (5,713 ) Amortization - All other (149,236 ) Change in unrealized investment gains and losses 20,873 Balance at December 31, 2018 889,598 Capitalization 797 Amortization - Impact of assumption and experience unlocking and true-ups 100,222 Amortization - All other (146,620 ) Change in unrealized investment gains and losses (31,273 ) Balance at December 31, 2019 $ 812,724 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2019 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance | REINSURANCE The Company uses reinsurance as part of its risk management and capital management strategies for certain of its living benefit guarantees and variable annuity base contracts. Effective April 1, 2016, the Company recaptured the risks related to its variable annuity living benefit guarantees that were previously reinsured to affiliates. In addition, the Company reinsured variable annuity base contracts, along with the living benefit guarantees, from Pruco Life, excluding the PLNJ business which was reinsured to Prudential Insurance. This reinsurance covers new and in force business and excludes business reinsured externally. Effective December 31, 2015, the Company surrendered its New York license and reinsured the majority of its New York business, both the living benefit guarantees and base contracts, to Prudential Insurance. See Note 1 for additional information. Reinsurance ceded arrangements do not discharge the Company as the primary insurer. Ceded balances would represent a liability of the Company in the event the reinsurers were unable to meet their obligations to the Company under the terms of the reinsurance agreements. The Company believes a material reinsurance liability resulting from such inability of reinsurers to meet their obligations is unlikely. Realized investment gains and losses include the impact of reinsurance agreements, particularly reinsurance agreements involving living benefit guarantees. These reinsurance agreements are derivatives and have been accounted for in the same manner as embedded derivatives and the changes in the fair value of these derivatives are recognized through "Realized investment gains (losses), net". See Note 4 for additional information related to the accounting for embedded derivatives. Reinsurance amounts included in the Company's Statements of Financial Position as of December 31, were as follows: 2019 2018 (in thousands) Reinsurance recoverables $ 621,510 $ 572,102 Deferred policy acquisition costs 3,725,719 3,703,166 Deferred sales inducements 437,594 476,608 Value of business acquired (2,275 ) (2,431 ) Other assets 65,819 79,992 Policyholders’ account balances 3,253,474 3,098,537 Future policy benefits 8,328,777 5,680,939 Reinsurance payables(1) 235,318 232,937 Other liabilities 337,909 290,330 (1) Includes $0.1 million of unaffiliated activity as of both December 31, 2019 and 2018 . The reinsurance recoverables by counterparty are broken out below: December 31, 2019 December 31, 2018 (in thousands) Prudential Insurance $ 387,355 $ 335,349 Pruco Life 233,933 236,716 Unaffiliated 222 37 Total reinsurance recoverables $ 621,510 $ 572,102 Reinsurance amounts, included in the Company’s Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, were as follows: 2019 2018 2017 (in thousands) Premiums: Direct $ 29,022 $ 37,895 $ 33,908 Assumed 31,570 31,989 32,890 Ceded (1,042 ) (2,619 ) (3,225 ) Net premiums 59,550 67,265 63,573 Policy charges and fee income: Direct 477,478 549,500 622,099 Assumed 1,638,023 1,661,484 1,632,132 Ceded(1) (34,455 ) (39,706 ) (44,652 ) Net policy charges and fee income 2,081,046 2,171,278 2,209,579 Asset administration fees and other income: Direct 141,884 96,743 129,847 Assumed 306,945 301,549 293,275 Ceded (8,346 ) (9,136 ) (9,747 ) Net asset administration fees and other income 440,483 389,156 413,375 Realized investment gains (losses), net: Direct (1,137,422 ) 81,120 (1,335,253 ) Assumed (1,584,764 ) 823,129 554,686 Ceded 40,866 (20,176 ) (24,833 ) Realized investment gains (losses), net (2,681,320 ) 884,073 (805,400 ) Policyholders' benefits (including change in reserves): Direct 58,308 81,045 52,477 Assumed 89,284 110,358 46,375 Ceded(2) (3,667 ) (4,315 ) 15,216 Net policyholders' benefits (including change in reserves) 143,925 187,088 114,068 Interest credited to policyholders’ account balances: Direct 82,444 127,018 9,834 Assumed 84,182 132,324 24,708 Ceded (5,417 ) (10,167 ) (4,262 ) Net interest credited to policyholders’ account balances 161,209 249,175 30,280 Reinsurance expense allowances and general and administrative expenses, net of capitalization and amortization 988,951 1,131,351 725,749 (1) Includes $(1) million , $(1) million and $(2) million of unaffiliated activity for the years ended December 31, 2019 , 2018 and 2017 , respectively. (2) Includes $(0.1) million , $(0.3) million and $(0.1) million of unaffiliated activity for the years ended December 31, 2019 , 2018 and 2017 , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The following schedule discloses significant components of income tax expense (benefit) for each year presented: Year Ended December 31, 2019 2018 2017 (in thousands) Current tax expense (benefit): U.S. federal $ 14,381 $ (422,999 ) $ 501,088 State and local 0 0 1,349 Total 14,381 (422,999 ) 502,437 Deferred tax expense (benefit): U.S. federal (305,482 ) 584,503 698,662 State and local 0 0 0 Total (305,482 ) 584,503 698,662 Income tax expense (benefit) (291,101 ) 161,504 1,201,099 Total income tax expense (benefit) reported in equity related to: Other comprehensive income (loss) 200,447 (52,510 ) 98,644 Additional paid-in capital 0 0 0 Total income tax expense (benefit) $ (90,654 ) $ 108,994 $ 1,299,743 Reconciliation of Expected Tax at Statutory Rates to Reported Income Tax Expense (Benefit) The differences between income taxes expected at the U.S. federal statutory income tax rate of 21% applicable for 2019 and 2018 and 35% applicable for 2017, and the reported income tax expense (benefit) are summarized as follows: Year Ended December 31, 2019 2018 2017 (in thousands) Expected federal income tax expense (benefit) $ (268,890 ) $ 387,286 $ 391,158 Non-taxable investment income (12,019 ) (18,954 ) (46,625 ) Tax credits (11,708 ) (13,694 ) (10,358 ) Changes in tax law 0 (193,306 ) 882,175 Other 1,516 172 (15,251 ) Reported income tax expense (benefit) $ (291,101 ) $ 161,504 $ 1,201,099 Effective tax rate 22.7 % 8.8 % 107.5 % The effective tax rate is the ratio of “Income tax expense (benefit)” divided by “Income (loss) from operations before income taxes”. The Company’s effective tax rate for fiscal years 2019, 2018 and 2017 was 22.7% , 8.8% and 107.5% , respectively. The following is a description of items that had the most significant impact on the difference between the Company’s statutory U.S. federal income tax rate of 21% applicable for 2019 and 2018 and 35% applicable for 2017, and the Company’s effective tax rate during the periods presented: Changes in Tax Law . The following is a list of notable changes in tax law that impacted the Company’s effective tax rate for the periods presented: Tax Act of 2017 - On December 22, 2017, the Tax Act of 2017 was enacted into U.S. law. As a result, the Company recognized a $882 million tax expense in “Income tax expense (benefit)” in the Company’s Statement of Operations for the year ended December 31, 2017. In accordance with SEC Staff Accounting Bulletin 118, in 2017 the Company recorded the effects of the Tax Act of 2017 using reasonable estimates due to the need for further analysis of the provisions within the Tax Act of 2017 and collection, preparation and analysis of relevant data necessary to complete the accounting. During 2018, the Company completed the collection, preparation and analysis of data relevant to the Tax Act of 2017, and interpreted any additional guidance issued by the IRS, U.S. Department of the Treasury, or other standard-setting organizations, and recognized a $0.2 million increase in income tax expense for a total of $882.3 million recognized from the reduction in net deferred tax assets to reflect the reduction in the U.S. tax rate from 35% to 21% . 2018 Industry Issue Resolution (IIR) - In August 2018, the IRS released a Directive to provide guidance on the tax reserving for guaranteed benefits within variable annuity contracts and principle-based reserves on certain life insurance contracts. Adopting the methodology specified in the Directive resulted in an accelerated deduction for the Company’s 2017 tax return, that would have otherwise been deductible in future years. Prior to the adoption of this Directive, the Company accounted for these future deductions as deferred tax assets measured using the current 21% corporate income tax rate. Upon adoption of the Directive, the tax benefits were revalued using the 35% tax rate applicable for the 2017 tax year and resulted in a reduction in income tax expense of $193 million . Non-Taxable Investment Income . The U.S. Dividends Received Deduction (“DRD”) reduces the amount of dividend income subject to U.S. tax and accounts for most of the non-taxable investment income shown in the table above. More specifically, the U.S. DRD constitutes $11 million of the total $12 million of 2019 non-taxable investment income, $15 million of the total $19 million of 2018 non-taxable investment income, and $46 million of the total $47 million of 2017 non-taxable investment income. The DRD for the current period was estimated using information from 2018, current year investment results, and current year’s equity market performance. The actual current year DRD can vary based on factors such as, but not limited to, changes in the amount of dividends received that are eligible for the DRD, changes in the amount of distributions received from fund investments, changes in the account balances of variable life and annuity contracts, and the Company’s taxable income before the DRD. Other . This line item represents insignificant reconciling items that are individually less than 5% of the computed expected federal income tax expense (benefit) and have therefore been aggregated for purposes of this reconciliation in accordance with relevant disclosure guidance. Schedule of Deferred Tax Assets and Deferred Tax Liabilities As of December 31, 2019 2018 (in thousands) Deferred tax assets: Insurance reserves $ 1,716,039 $ 1,521,729 Investments 411,788 276,880 Net unrealized loss on securities 0 86,742 Other 2,002 638 Deferred tax assets 2,129,829 1,885,989 Deferred tax liabilities: VOBA and deferred policy acquisition cost 929,882 929,849 Deferred sales inducements 170,672 186,816 Net unrealized gain on securities 154,815 0 Deferred tax liabilities 1,255,369 1,116,665 Net deferred tax asset (liability) $ 874,460 $ 769,324 The application of U.S. GAAP requires the Company to evaluate the recoverability of deferred tax assets and establish a valuation allowance if necessary to reduce the deferred tax asset to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. In evaluating the need for a valuation allowance, the Company considers many factors, including: (1) the nature of the deferred tax assets and liabilities; (2) whether they are ordinary or capital; (3) in which tax jurisdictions they were generated and the timing of their reversal; (4) taxable income in prior carryback years as well as projected taxable earnings exclusive of reversing temporary differences and carryforwards; (5) the length of time that carryovers can be utilized in the various taxing jurisdictions; (6) any unique tax rules that would impact the utilization of the deferred tax assets; and (7) any tax planning strategies that the Company would employ to avoid a tax benefit from expiring unused. Although realization is not assured, management believes it is more likely than not that the deferred tax assets, net of valuation allowances, will be realized. The company had no valuation allowance as of December 31, 2019 and 2018 . Adjustments to the valuation allowance will be made if there is a change in management’s assessment of the amount of deferred tax asset that is realizable. The Company’s income (loss) from operations before income taxes includes income (loss) from domestic operations of $(1,280) million , $1,844 million , and $1,118 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Tax Audit and Unrecognized Tax Benefits The Company’s liability for income taxes includes the liability for unrecognized tax benefits and interest that relate to tax years still subject to review by the IRS or other taxing authorities. The completion of review or the expiration of the Federal statute of limitations for a given audit period could result in an adjustment to the liability for income taxes. The Company had no unrecognized tax benefits as of December 31, 2019 , 2018 , and 2017. The Company does not anticipate any significant changes within the next twelve months to its total unrecognized tax benefits related to tax years for which the statute of limitations has not expired. At December 31, 2019 , the Company remains subject to examination in the U.S. for tax years 2015 through 2019 . The Company participates in the IRS’s Compliance Assurance Program. Under this program, the IRS assigns an examination team to review completed transactions as they occur in order to reach agreement with the Company on how they should be reported in the relevant tax returns. If disagreements arise, accelerated resolution programs are available to resolve the disagreements in a timely manner. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Equity | EQUITY Accumulated Other Comprehensive Income (Loss) AOCI represents the cumulative OCI items that are reported separate from net income and detailed on the Statements of Comprehensive Income. Each of the components that comprise OCI are described in further detail in Note 2 (Foreign Currency Translation Adjustment and Net Unrealized Investment Gains (Losses)). The balance of and changes in each component of AOCI as of and for the years ended December 31, are as follows: Accumulated Other Comprehensive Income (Loss) Foreign Currency Translation Adjustment Net Unrealized Investment Gains (Losses)(1) Total Accumulated Other Comprehensive Income (Loss) (in thousands) Balance, December 31, 2016 $ (78 ) $ (314,870 ) $ (314,948 ) Change in OCI before reclassifications 109 320,182 320,291 Amounts reclassified from AOCI 0 3,177 3,177 Income tax benefit (expense) (38 ) (98,606 ) (98,644 ) Balance, December 31, 2017 (7 ) (90,117 ) (90,124 ) Change in OCI before reclassifications (1,354 ) (311,658 ) (313,012 ) Amounts reclassified from AOCI 0 62,970 62,970 Income tax benefit (expense) 285 52,225 52,510 Cumulative effect of adoption of ASU 2016-01 0 (3 ) (3 ) Cumulative effect of adoption of ASU 2018-02 (2 ) (36,712 ) (36,714 ) Balance, December 31, 2018 (1,078 ) (323,295 ) (324,373 ) Change in OCI before reclassifications 182 956,373 956,555 Amounts reclassified from AOCI 0 (3,123 ) (3,123 ) Income tax benefit (expense) (38 ) (200,409 ) (200,447 ) Balance, December 31, 2019 $ (934 ) $ 429,546 $ 428,612 (1) Includes cash flow hedges of $0 million , $(4) million and $(26) million as of December 31, 2019 , 2018 , and 2017 , respectively. Reclassifications out of Accumulated Other Comprehensive Income (Loss) Year Ended December 31, 2019 Year Ended December 31, 2018 Year Ended December 31, 2017 (in thousands) Amounts reclassified from AOCI(1)(2): Net unrealized investment gains (losses): Cash flow hedges - Currency/Interest rate(3) $ 7,054 $ 20,761 $ (1,838 ) Net unrealized investment gains (losses) on available-for-sale securities (3,931 ) (83,731 ) (1,339 ) Total net unrealized investment gains (losses)(4) 3,123 (62,970 ) (3,177 ) Total reclassifications for the period $ 3,123 $ (62,970 ) $ (3,177 ) (1) All amounts are shown before tax. (2) Positive amounts indicate gains/benefits reclassified out of AOCI. Negative amounts indicate losses/costs reclassified out of AOCI. (3) See Note 4 for additional information on cash flow hedges. (4) See table below for additional information on unrealized investment gains (losses), including the impact on deferred policy acquisition and other costs and future policy benefits. Net Unrealized Investment Gains (Losses) Net unrealized investment gains (losses) on securities classified as available-for-sale and certain other invested assets and other assets are included in the Company’s Statements of Financial Position as a component of AOCI. Changes in these amounts include reclassification adjustments to exclude from “Other comprehensive income (loss)” those items that are included as part of “Net income” for a period that had been part of “Other comprehensive income (loss)” in earlier periods. The amounts for the periods indicated below, split between amounts related to fixed maturity securities on which an OTTI loss has been recognized, and all other net unrealized investment gains (losses), are as follows: Net Unrealized Investment Gains (Losses) on Fixed Maturity Securities on which an OTTI loss has been recognized Net Unrealized Gains (Losses) on Investments Deferred Policy Acquisition Costs and Other Costs(2) Future Policy Benefits and Other Liabilities(3) Deferred Income Tax (Liability) Benefit Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) (in thousands) Balance, December 31, 2016 $ (1,261 ) $ (2,133 ) $ (522 ) $ 1,387 $ (2,529 ) Net investment gains (losses) on investments arising during the period 11,328 0 0 (3,481 ) 7,847 Reclassification adjustment for (gains) losses included in net income 2,172 0 0 (667 ) 1,505 Reclassification adjustment for OTTI losses excluded from net income (1) 72 0 0 (22 ) 50 Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 1,125 0 (352 ) 773 Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 365 (128 ) 237 Balance, December 31, 2017 12,311 (1,008 ) (157 ) (3,263 ) 7,883 Net investment gains (losses) on investments arising during the period (15,199 ) 0 0 3,192 (12,007 ) Reclassification adjustment for (gains) losses included in net income (205 ) 0 0 43 (162 ) Reclassification adjustment for OTTI losses excluded from net income (1) (241 ) 0 0 51 (190 ) Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (111 ) 0 23 (88 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 89 (19 ) 70 Balance, December 31, 2018 (3,334 ) (1,119 ) (68 ) 27 (4,494 ) Net investment gains (losses) on investments arising during the period 17,795 0 0 (3,741 ) 14,054 Reclassification adjustment for (gains) losses included in net income (100 ) 0 0 21 (79 ) Reclassification adjustment for OTTI losses excluded from net income (1) (52 ) 0 0 11 (41 ) Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (80 ) 0 17 (63 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 (51 ) 11 (40 ) Balance, December 31, 2019 $ 14,309 $ (1,199 ) $ (119 ) $ (3,654 ) $ 9,337 (1) Represents "transfers in" related to the portion of OTTI losses recognized during the period that were not recognized in earnings for securities with no prior OTTI loss. (2) "Other costs" primarily includes reinsurance recoverables, DSI and VOBA. (3) "Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains. All Other Net Unrealized Investment Gains (Losses) in AOCI Net Unrealized Gains (Losses) on Investments (1) Deferred Policy Acquisition Costs and Other Costs(3) Future Policy Benefits and Other Liabilities(4) Deferred Income Tax (Liability) Benefit Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) (in thousands) Balance, December 31, 2016 $ (442,314 ) $ (31,251 ) $ (5,664 ) $ 166,888 $ (312,341 ) Net investment gains (losses) on investments arising during the period 376,012 0 0 (115,538 ) 260,474 Reclassification adjustment for (gains) losses included in net income (5,349 ) 0 0 1,644 (3,705 ) Reclassification adjustment for OTTI losses excluded from net income (2) (72 ) 0 0 22 (50 ) Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (50,961 ) 0 15,949 (35,012 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 (11,333 ) 3,967 (7,366 ) Balance, December 31, 2017 (71,723 ) (82,212 ) (16,997 ) 72,932 (98,000 ) Net investment gains (losses) on investments arising during the period (405,264 ) 0 0 85,105 (320,159 ) Reclassification adjustment for (gains) losses included in net income 63,175 0 0 (13,267 ) 49,908 Reclassification adjustment for OTTI losses excluded from net income (2) 241 0 0 (51 ) 190 Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 90,717 0 (19,049 ) 71,668 Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 18,110 (3,803 ) 14,307 Cumulative effect of adoption of ASU 2016-01 (4 ) 0 0 1 (3 ) Cumulative effect of adoption of ASU 2018-02 0 0 0 (36,712 ) (36,712 ) Balance, December 31, 2018 (413,575 ) 8,505 1,113 85,156 (318,801 ) Net investment gains (losses) on investments arising during the period 1,139,167 0 0 (239,496 ) 899,671 Reclassification adjustment for (gains) losses included in net income (3,023 ) 0 0 636 (2,387 ) Reclassification adjustment for OTTI losses excluded from net income (2) 52 0 0 (11 ) 41 Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (163,481 ) 0 34,369 (129,112 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 (36,977 ) 7,774 (29,203 ) Balance, December 31, 2019 $ 722,621 $ (154,976 ) $ (35,864 ) $ (111,572 ) $ 420,209 (1) Includes cash flow hedges. See Note 4 for information on cash flow hedges. (2) Represents "transfers out" related to the portion of OTTI losses recognized during the period that were not recognized in earnings for securities with no prior OTTI loss. (3) "Other costs" primarily includes reinsurance recoverables, DSI and VOBA. (4) "Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains. |
Statutory Net Income and Surplu
Statutory Net Income and Surplus and Dividend Restrictions | 12 Months Ended |
Dec. 31, 2019 | |
Insurance [Abstract] | |
Statutory Net Income and Surplus and Dividend Restrictions | STATUTORY NET INCOME AND SURPLUS AND DIVIDEND RESTRICTIONS The Company is required to prepare statutory financial statements in accordance with accounting practices prescribed or permitted by the AZDOI. Prescribed statutory accounting practices include publications of the NAIC, as well as state laws, regulations and general administrative rules. Statutory accounting practices primarily differ from U.S. GAAP by charging policy acquisition costs to expense as incurred, establishing future policy benefit liabilities using different actuarial assumptions and valuing investments, deferred taxes and certain assets on a different basis. Statutory net income (loss) of the Company amounted to $(2,052) million , $ (852) million and $ 3,911 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Statutory surplus of the Company amounted to $4,748 million and $ 6,396 million at December 31, 2019 and 2018 , respectively. The Company does not utilize prescribed or permitted practices that vary materially from the statutory accounting practices prescribed by the NAIC. The Company is subject to Arizona law, which limits the amount of dividends that insurance companies can pay to stockholders. The maximum dividend, which may be paid in any twelve-month period without notification or approval, is limited to the lesser of 10% of statutory surplus, as of December 31 of the preceding year, or the net gain from operations of the preceding calendar year. Cash dividends may only be paid out of surplus derived from realized net profits. Based on these limitations, the Company is no t permitted to pay a dividend in 2020 without prior notification. In December, September, June and March 2019 , the Company paid an extra-ordinary dividend of $241 million , $245 million , $247 million and $245 million , respectively, to its parent, PAI, which was recorded as a return of capital. In December, September, June and March 2018 , the Company paid an extra-ordinary dividend of $225 million , $250 million , $250 million and $300 million , respectively to PAI, which was recorded as a return of capital. In December, September, and June 2017 , the Company paid an extra-ordinary dividend of $650 million , $200 million and $100 million |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS The Company has extensive transactions and relationships with Prudential Insurance and other affiliates. Although we seek to ensure that these transactions and relationships are fair and reasonable, it is possible that the terms of these transactions are not the same as those that would result from transactions among unrelated parties. Expense Charges and Allocations The majority of the Company’s expenses are allocations or charges from Prudential Insurance or other affiliates. These expenses can be grouped into general and administrative expenses and agency distribution expenses. The Company’s general and administrative expenses are charged to the Company using allocation methodologies based on business production processes. Management believes that the methodology is reasonable and reflects costs incurred by Prudential Insurance to process transactions on behalf of the Company. The Company operates under service and lease agreements whereby services of officers and employees, supplies, use of equipment and office space are provided by Prudential Insurance. The Company reviews its allocation methodology periodically which it may adjust accordingly. General and administrative expenses include allocations of stock compensation expenses related to a stock-based awards program and a deferred compensation program issued by Prudential Financial. The expense charged to the Company for the stock-based awards program was $0.1 million for each of the years ended December 31, 2019 , 2018 and 2017 . The expense charged to the Company for the deferred compensation program was $0.6 million , $0.5 million and $0.9 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. The Company is charged for its share of employee benefit expenses. These expenses include costs for funded and non-funded, non-contributory defined benefit pension plans. Some of these benefits are based on final earnings and length of service while others are based on an account balance, which takes into consideration age, service and earnings during a career. The Company’s share of net expense for the pension plans was $2 million , $2 million and $1 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. The Company is also charged for its share of the costs associated with welfare plans issued by Prudential Insurance. These expenses include costs related to medical, dental, life insurance and disability. The Company's share of net expense for the welfare plans was $2 million for each of the years ended December 31, 2019 , 2018 and 2017 . Prudential Insurance sponsors voluntary savings plans for its employee 401(k) plans. The plans provide for salary reduction contributions by employees and matching contributions by the Company of up to 4% of annual salary. The Company's expense for its share of the voluntary savings plan was $0.9 million , $0.7 million and $0.5 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. The Company pays commissions and certain other fees to PAD in consideration for PAD’s marketing and underwriting of the Company’s products. Commissions and fees are paid by PAD to broker-dealers who sell the Company’s products. Commissions and fees paid by the Company to PAD were $97 million , $122 million and $109 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. The Company is charged for its share of corporate expenses incurred by Prudential Financial to benefit its businesses, such as advertising, executive oversight, external affairs and philanthropic activity. The Company’s share of corporate expenses was $25 million, $15 million and $14 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Affiliated Investment Management Expenses In accordance with an agreement with PGIM, Inc. (“PGIM”), the Company pays investment management expenses to PGIM who acts as investment manager to certain Company general account and separate account assets. Investment management expenses paid to PGIM related to this agreement were $14 million , $12 million and $13 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. These expenses are recorded as “Net investment income” in the Statements of Operations and Comprehensive Income (Loss). Derivative Trades In its ordinary course of business, the Company enters into OTC derivative contracts with an affiliate, PGF. For these OTC derivative contracts, PGF has a substantially equal and offsetting position with an external counterparty. See Note 4 for additional information. Joint Ventures The Company has made investments in joint ventures with certain subsidiaries of Prudential Financial. "Other invested assets" includes $391 million and $228 million as of December 31, 2019 and 2018 , respectively. "Net investment income" related to these ventures includes a gain of $17 million , $1 million and $9 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Affiliated Asset Administration Fee Income The Company has a revenue sharing agreement with AST Investment Services, Inc. (“ASTISI”) and PGIM Investments LLC (“PGIM Investments”) whereby the Company receives fee income based on policyholders' separate account balances invested in the Advanced Series Trust and The Prudential Series Fund. Income received from ASTISI and PGIM Investments related to this agreement was $96 million , $105 million and $111 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. These revenues are recorded as “Asset administration fees and other income” in the Statements of Operations and Comprehensive Income (Loss). Affiliated Notes Receivable Affiliated notes receivable included in "Receivables from parent and affiliates" at December 31, were as follows: Maturity Dates Interest Rates 2019 2018 (in thousands) U.S. dollar floating rate notes 2028 3.83% - 4.25 % $ 0 $ 34,008 U.S. dollar fixed rate notes 2026 - 2027 2.62% - 14.85 % 52,573 3,184 Total long-term notes receivable - affiliated(1) $ 52,573 $ 37,192 (1) All long-term notes receivable may be called for prepayment prior to the respective maturity dates under specified circumstances. The affiliated notes receivable shown above are classified as available-for-sale securities carried at fair value. The Company monitors the internal and external credit ratings of these loans and loan performance. The Company also considers any guarantees made by Prudential Insurance for loans due from affiliates. Accrued interest receivable related to these loans was $0.0 million and $0.3 million as of December 31, 2019 and 2018 , respectively, and is included in “Other assets”. Revenues related to these loans were $0.1 million , $0.4 million and $0.7 million for the years ended December 31, 2019 , 2018 and 2017 , respectively, and are included in “Asset administration fees and other income”. Affiliated Asset Transfers The Company participates in affiliated asset trades with parent and sister companies. Book and market value differences for trades with a parent and sister are recognized within "Additional paid-in-capital" ("APIC") and "Realized investment gains (losses), net", respectively. The table below shows affiliated asset trades for the years ended December 31, 2019 and 2018 : Affiliate Date Transaction Security Type Fair Value Book Value APIC, Net of Tax Increase/ (Decrease) Realized Investment Gain/ (Loss), Net of Tax (in thousands) Prudential Insurance February 2018 Purchase Fixed Maturities $ 136,963 $ 136,963 $ 0 $ 0 Pruco Life Insurance Company of Arizona April 2018 Sale Fixed Maturities $ 64,313 $ 64,514 $ 0 $ (159 ) Prudential Insurance April 2018 Sale Fixed Maturities $ 57,747 $ 43,434 $ 0 $ 11,308 Prudential Insurance May 2018 Sale Fixed Maturity & Commercial Mortgages $ 162,111 $ 159,237 $ 0 $ 2,271 Passaic Fund LLC June 2018 Transfer Out Other Invested Assets - Privates $ 15,281 $ 15,281 $ 0 $ 0 Prudential Insurance July 2018 Sale Fixed Maturities $ 11,160 $ 9,277 $ 0 $ 1,488 Prudential Insurance August 2018 Sale Commercial Mortgages $ 13,414 $ 13,165 $ 0 $ 196 Prudential Insurance December 2018 Purchase Fixed Maturities $ 33,256 $ 33,166 $ 0 $ (71 ) Prudential Agricultural Investors LP December 2018 Transfer Out Other Invested Assets - Privates $ 7,324 $ 7,324 $ 0 $ 0 Prudential Insurance January 2019 Sale Fixed Maturities $ 20,504 $ 20,781 $ 0 $ (277 ) Prudential Insurance February 2019 Sale Commercial Mortgages $ 97,953 $ 98,506 $ 0 $ (554 ) Prudential Insurance March 2019 Purchase Fixed Maturities $ 141,476 $ 141,476 $ 0 $ 7,776 Prudential Insurance April 2019 Purchase Equity Securities $ 4,300 $ 4,300 $ 0 $ 0 Prudential Retirement Insurance and Annuity Company April 2019 Purchase Equity Securities $ 1,258 $ 1,258 $ 0 $ 0 Pruco Life Insurance Company April 2019 Purchase Equity Securities $ 14,525 $ 14,525 $ 0 $ 0 Prudential Insurance June 2019 Transfer out Fixed Maturities $ 23,066 $ 23,002 $ 0 $ 64 Prudential Insurance June 2019 Transfer In Fixed Maturities $ 19,919 $ 19,919 $ 0 $ 0 Prudential Insurance August 2019 Sale Fixed Maturities $ 66,346 $ 64,735 $ 0 $ 1,611 Prudential Insurance August 2019 Sale Commercial Mortgages $ 106,307 $ 104,733 $ 0 $ 1,574 Prudential Insurance November 2019 Sale Other Invested Assets $ 2,289 $ 2,362 $ 0 $ (73 ) Prudential Insurance November 2019 Sale Fixed Maturity $ 6,517 $ 8,550 $ 0 $ (2,033 ) Prudential Insurance December 2019 Purchase Fixed Maturity $ 5,271 $ 5,271 $ 0 $ 0 Prudential Insurance December 2019 Purchase Fixed Maturity $ 85,261 $ 85,261 $ 0 $ 0 Prudential Insurance December 2019 Sale Fixed Maturity $ 21,425 $ 20,628 $ 0 $ 797 Debt Agreements The Company is authorized to borrow funds up to $9 billion from Prudential Financial and its affiliates to meet its capital and other funding needs. The following table provides the breakout of the Company's short and long-term debt to affiliates: Affiliate Date Issued Amount of Notes - December 31, 2019 Amount of Notes - December 31, 2018 Interest Rate Date of Maturity (in thousands) Prudential Insurance 4/20/2016 $ 0 $ 46,835 2.80 % 6/20/2019 Prudential Insurance 4/20/2016 0 18,734 2.80 % 6/20/2019 Prudential Insurance 4/20/2016 37,468 37,468 3.64 % 12/6/2020 Prudential Insurance 4/20/2016 93,671 93,671 3.64 % 12/15/2020 Prudential Insurance 4/20/2016 103,039 103,039 3.64 % 12/15/2020 Prudential Insurance 4/20/2016 93,671 93,671 3.47 % 6/20/2021 Prudential Insurance 4/20/2016 93,671 93,671 4.39 % 12/15/2023 Prudential Insurance 4/20/2016 28,102 28,102 4.39 % 12/15/2023 Prudential Insurance 4/20/2016 37,468 37,468 3.95 % 6/20/2024 Prudential Insurance 4/20/2016 93,671 93,671 3.95 % 6/20/2024 Prudential Insurance 4/20/2016 46,835 46,835 3.95 % 6/20/2024 Prudential Insurance 6/28/2016 0 30,000 2.08 % 6/28/2019 Prudential Insurance 6/28/2016 0 50,000 3.49 % 6/28/2026 Prudential Insurance 6/28/2016 0 25,000 3.49 % 6/28/2026 Prudential Insurance 6/28/2016 26,000 26,000 2.59 % 6/28/2021 Prudential Insurance 6/28/2016 0 25,000 2.08 % 6/28/2019 Prudential Insurance 6/28/2016 0 20,000 2.08 % 6/28/2019 Prudential Insurance 6/28/2016 0 25,000 3.49 % 6/28/2026 Prudential Retirement Insurance & Annuity 6/28/2016 0 34,000 3.09 % 6/28/2023 Prudential Funding LLC 12/16/2019 1,298 0 2.02 % 1/16/2020 Prudential Funding LLC 12/17/2019 1,478 0 2.02 % 1/15/2020 Prudential Funding LLC 12/17/2019 502 0 2.02 % 1/16/2020 Prudential Funding LLC 12/18/2019 4,638 0 2.02 % 1/16/2020 Total Loans Payable to Affiliates $ 661,512 $ 928,165 The total interest expense to the Company related to loans and other payables to affiliates was $107 million , $58 million and $66 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Contributed Capital and Dividends Through December 31, 2019, 2018 and 2017, the Company did no t receive any capital contributions. In March, June, September and December of 2019, there was a $245 million $247 million , $245 million and $241 million return of capital, respectively, to PAI. In March, June, September and December of 2018, there was a $300 million , $250 million , $250 million and $225 million return of capital, respectively, to PAI. In June, September and December of 2017, there was a $100 million , $200 million and $650 million return of capital, respectively, to PAI. Reinsurance with Affiliates As discussed in Note 10 , the Company participates in reinsurance transactions with certain affiliates. |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingent Liabilities | COMMITMENTS AND CONTINGENT LIABILITIES Commitments The Company has made commitments to fund commercial mortgage loans. As of December 31, 2019 and 2018 , the outstanding balances on these commitments were $43 million and $4 million , respectively. The Company also made commitments to purchase or fund investments, mostly private fixed maturities. As of December 31, 2019 and 2018 , $207 million and $271 million , respectively, of these commitments were outstanding. Contingent Liabilities On an ongoing basis, the Company and its regulators review its operations including, but not limited to, sales and other customer interface procedures and practices, and procedures for meeting obligations to its customers and other parties. These reviews may result in the modification or enhancement of processes or the imposition of other action plans, including concerning management oversight, sales and other customer interface procedures and practices, and the timing or computation of payments to customers and other parties. In certain cases, if appropriate, the Company may offer customers or other parties remediation and may incur charges, including the cost of such remediation, administrative costs and regulatory fines. The Company is subject to the laws and regulations of states and other jurisdictions concerning the identification, reporting and escheatment of unclaimed or abandoned funds, and is subject to audit and examination for compliance with these requirements. For additional discussion of these matters, see “Litigation and Regulatory Matters” below. It is possible that the results of operations or the cash flows of the Company in a particular quarterly or annual period could be materially affected as a result of payments in connection with the matters discussed above or other matters depending, in part, upon the results of operations or cash flows for such period. Management believes, however, that ultimate payments in connection with these matters, after consideration of applicable reserves and rights to indemnification, should not have a material adverse effect on the Company’s financial position. Litigation and Regulatory Matters The Company is subject to legal and regulatory actions in the ordinary course of its business. Pending legal and regulatory actions include proceedings specific to the Company and proceedings generally applicable to business practices in the industry in which it operates. The Company is subject to class action lawsuits and other litigation involving a variety of issues and allegations involving sales practices, claims payments and procedures, premium charges, policy servicing and breach of fiduciary duty to customers. The Company is also subject to litigation arising out of its general business activities, such as its investments, contracts, leases and labor and employment relationships, including claims of discrimination and harassment, and could be exposed to claims or litigation concerning certain business or process patents. In addition, the Company, along with other participants in the businesses in which it engages, may be subject from time to time to investigations, examinations and inquiries, in some cases industry-wide, concerning issues or matters upon which such regulators have determined to focus. In some of the Company’s pending legal and regulatory actions, parties are seeking large and/or indeterminate amounts, including punitive or exemplary damages. The outcome of litigation or a regulatory matter, and the amount or range of potential loss at any particular time, is often inherently uncertain. The Company establishes accruals for litigation and regulatory matters when it is probable that a loss has been incurred and the amount of that loss can be reasonably estimated. For litigation and regulatory matters where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established, but the matter, if material, is disclosed. The Company estimates that as of December 31, 2019 , the aggregate range of reasonably possible losses in excess of accruals established for those litigation and regulatory matters for which such an estimate currently can be made is less than $150 million . This estimate is not an indication of expected loss, if any, or the Company’s maximum possible loss exposure on such matters. The Company reviews relevant information with respect to its litigation and regulatory matters on a quarterly and annual basis and updates its accruals, disclosures and estimates of reasonably possible loss based on such reviews. Securities Lending and Foreign Tax Reclaim Matter In 2016, Prudential Financial self-reported to the SEC and the U.S. Department of Labor ("DOL"), and notified other regulators, that in some cases it failed to maximize securities lending income for the benefit of certain separate account investments due to a long-standing restriction benefiting Prudential Financial that limited the availability of loanable securities. Prudential Financial has removed the restriction and implemented a remediation plan for the benefit of customers. As part of Prudential Financial’s review of this matter, in 2018 it further self-reported to the SEC, and notified other regulators, that in some cases it failed to timely process foreign tax reclaims for the separate account investments. Prudential Financial has corrected the foreign tax reclaim process and has implemented a remediation plan for the benefit of customers. The DOL’s review of the securities lending matter is closed. In September 2019, Prudential Financial reached a settlement of these matters with the SEC. As part of the settlement Prudential Financial agreed to pay a fine of $5 million and disgorgement of $27.6 million , and consented to the entry of an Administrative Order containing findings that two of its subsidiaries violated certain sections of the Investment Advisers Act of 1940 and the Investment Advisers Act Rules and ordering the subsidiaries to cease and desist from committing or causing any violations and any future violations of those provisions. In reaching this settlement, Prudential Financial neither admitted nor denied the SEC’s findings. Summary The Company’s litigation and regulatory matters are subject to many uncertainties, and given their complexity and scope, their outcome cannot be predicted. It is possible that the Company’s results of operations or cash flows in a particular quarterly or annual period could be materially affected by an ultimate unfavorable resolution of pending litigation and regulatory matters depending, in part, upon the results of operations or cash flows for such period. In light of the unpredictability of the Company’s litigation and regulatory matters, it is also possible that in certain cases an ultimate unfavorable resolution of one or more pending litigation or regulatory matters could have a material adverse effect on the Company’s financial position. Management believes, however, that, based on information currently known to it, the ultimate outcome of all pending litigation and regulatory matters, after consideration of applicable reserves and rights to indemnification, is not likely to have a material adverse effect on the Company’s financial position. |
Contract Withdrawal Provisions
Contract Withdrawal Provisions | 12 Months Ended |
Dec. 31, 2019 | |
Contract Withdrawal Provisions [Abstract] | |
Contract Withdrawal Provisions | CONTRACT WITHDRAWAL PROVISIONS Most of the Company’s separate account liabilities are subject to discretionary withdrawal by contractholders at market value. Separate account assets, which are carried at fair value, are adequate to pay such withdrawals, which are generally subject to surrender charges ranging from 9% to 1% for contracts held less than 10 years . |
Quarterly Results of Operations
Quarterly Results of Operations (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Data [Abstract] | |
Quarterly Results of Operations (Unaudited) | QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The unaudited quarterly results of operations for the years ended December 31, 2019 and 2018 are summarized in the table below: Three Months Ended March 31 June 30 September 30 December 31 (in thousands) 2019 Total revenues $ (582,563 ) $ (103,779 ) $ 272,685 $ 864,964 Total benefits and expenses 296,641 404,277 558,773 472,044 Income (loss) from operations before income taxes (879,204 ) (508,056 ) (286,088 ) 392,920 Net income (loss) $ (900,024 ) $ (168,770 ) $ (227,512 ) $ 306,979 2018 Total revenues $ 1,331,262 $ 769,260 $ 826,028 $ 988,030 Total benefits and expenses 539,327 517,619 561,865 451,549 Income (loss) from operations before income taxes 791,935 251,641 264,163 536,481 Net income (loss) $ 635,679 $ 202,546 $ 412,236 $ 432,255 |
Schedule I - Summary of Investm
Schedule I - Summary of Investments Other Than investments in Related Parties Schedule I - Summary of Investments Other Than investments in Related Parties | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Abstract] | |
Schedule I - Summary of Investments Other Than investments in Related Parties | Type of Investment Amortized Cost or Cost(1) Fair Value Amount Shown in the Balance Sheet Fixed maturities, available-for-sale: Bonds: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 6,667,347 $ 7,119,824 $ 7,119,824 Obligations of U.S. states and their political subdivisions 252,304 259,682 259,682 Foreign governments 203,386 222,884 222,884 Asset-backed securities 443,767 444,438 444,438 Residential mortgage-backed securities 73,814 77,761 77,761 Commercial mortgage-backed securities 557,584 578,289 578,289 Public utilities 527,829 563,139 563,139 All other corporate bonds 3,710,374 3,905,082 3,905,082 Redeemable preferred stock 29,341 31,266 31,266 Total fixed maturities, available-for-sale $ 12,465,746 $ 13,202,365 $ 13,202,365 Equity securities: Common stocks: Other common stocks $ 10,526 $ 11,387 $ 11,387 Mutual funds 49,699 52,256 52,256 Perpetual preferred stocks 3,422 3,860 3,860 Total equity securities, at fair value $ 63,647 $ 67,503 $ 67,503 Fixed maturities, trading $ 349,428 $ 383,198 $ 383,198 Commercial mortgage and other loans(2) 1,471,522 1,471,522 Policy loans 12,366 12,366 Short-term investments 335,358 335,358 Other invested assets 474,013 474,013 Total investments $ 15,172,080 $ 15,946,325 (1) For fixed maturities available-for-sale, original cost reduced by repayments and impairments and adjusted for amortization of premiums and accretion of discounts. (2) At carrying value, which is net of allowance for credit losses. |
Significant Accounting Polici_2
Significant Accounting Policies and Pronouncements (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The most significant estimates include those used in determining DAC and related amortization; fair value of embedded derivative instruments associated with the index-linked features of certain fixed annuity products; value of business acquired ("VOBA") and its amortization; amortization of DSI; valuation of investments including derivatives and the recognition of other-than-temporary impairments (“OTTI”); future policy benefits including guarantees; provision for income taxes and valuation of deferred tax assets; and accruals for contingent liabilities, including estimates for losses in connection with unresolved legal and regulatory matters. |
Reclassifications | Reclassifications Certain amounts in prior periods have been reclassified to conform to the current period presentation. |
Investments and Investment-Related Liabilities | Fixed maturities, available-for-sale, at fair value are comprised of bonds, notes and redeemable preferred stock. Fixed maturities classified as “available-for-sale” are carried at fair value. See Note 5 for additional information regarding the determination of fair value. The associated unrealized gains and losses, net of tax, and the effect on DAC, VOBA, DSI, future policy benefits, policyholders’ account balances that would result from the realization of unrealized gains and losses, are included in “Accumulated other comprehensive income (loss)” (“AOCI”). The purchased cost of fixed maturities is adjusted for amortization of premiums and accretion of discounts to maturity or, if applicable, call date. Interest income, and amortization of premium and accretion of discount are included in “Net investment income” under the effective yield method. Additionally, prepayment premiums are also included in “Net investment income”. For mortgage-backed and asset-backed securities, the effective yield is based on estimated cash flows, including interest rate and prepayment assumptions based on data from widely accepted third-party data sources or internal estimates. In addition to interest rate and prepayment assumptions, cash flow estimates also vary based on other assumptions regarding the underlying collateral including default rates and changes in value. These assumptions can significantly impact income recognition and the amount of OTTI recognized in earnings and other comprehensive income (loss) ("OCI"). For high credit quality mortgage-backed and asset-backed securities (those rated AA or above), cash flows are provided quarterly, and the amortized cost and effective yield of the securities are adjusted as necessary to reflect historical prepayment experience and changes in estimated future prepayments. The adjustments to amortized cost are recorded as a charge or credit to "Net investment income" in accordance with the retrospective method. For mortgage-backed and asset-backed securities rated below AA or those for which an OTTI has been recorded, the effective yield is adjusted prospectively for any changes in estimated cash flows. See the discussion below on realized investment gains and losses for a description of the accounting for impairments. Fixed maturities, trading, at fair value consists of fixed maturities that are carried at fair value. Realized and unrealized gains and losses on these investments are reported in “Asset administration fees and other income”, and interest and dividend income from these investments is reported in “Net investment income”. Equity securities, at fair value is comprised of common stock and mutual fund shares, which are carried at fair value. Realized and unrealized gains and losses on these investments are reported in “Asset administration fees and other income”, and dividend income is reported in “Net investment income” on the ex-dividend date. Effective January 1, 2018, the Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities using a modified retrospective method. Adoption of this ASU impacted the Company’s accounting and presentation related to equity investments. The most significant impact is that the changes in fair value of equity securities previously classified as “available-for-sale” are reported in net income within “Asset administration fees and other income” in the Statements of Operations. Prior to this, the changes in fair value on equity securities classified as “available-for-sale” were reported in AOCI. The impact of this standard resulted in an increase to retained earnings of $337 thousand , a reduction to AOCI of $3 thousand , and an increase to equity of $334 thousand upon adoption on January 1, 2018. Commercial mortgage and other loans consist of commercial mortgage loans and agricultural property loans. Commercial mortgage and other loans held for investment are generally carried at unpaid principal balance, net of unamortized deferred loan origination fees and expenses and net of an allowance for losses. Commercial mortgage and other loans acquired, including those related to the acquisition of a business, are recorded at fair value when purchased, reflecting any premiums or discounts to unpaid principal balances. Interest income, and the amortization of the related premiums or discounts, are included in “Net investment income” under the effective yield method. Prepayment fees are also included in "Net investment income". Impaired loans include those loans for which it is probable that amounts due will not all be collected according to the contractual terms of the loan agreement. The Company defines “past due” as principal or interest not collected at least 30 days past the scheduled contractual due date. Interest received on loans that are past due, including impaired and non-impaired loans, as well as, loans that were previously modified in a troubled debt restructuring, is either applied against the principal or reported as net investment income based on the Company’s assessment as to the collectability of the principal. See Note 3 for additional information about the Company’s past due loans. The Company discontinues accruing interest on loans after the loans become 90 days delinquent as to principal or interest payments, or earlier when the Company has doubts about collectability. When the Company discontinues accruing interest on a loan, any accrued but uncollectible interest on the loan and other loans backed by the same collateral, if any, is charged to interest income in the same period. Generally, a loan is restored to accrual status only after all delinquent interest and principal are brought current and, in the case of loans where the payment of interest has been interrupted for a substantial period, or the loan has been modified, a regular payment performance has been established. The Company reviews the performance and credit quality of the commercial mortgage and other loan portfolio on an on-going basis. Loans are placed on watch list status based on a predefined set of criteria and are assigned one of two categories. Loans are classified as “closely monitored” when it is determined that there is a collateral deficiency or other credit events that may lead to a potential loss of principal or interest. Loans “not in good standing” are those loans where the Company has concluded that there is a high probability of loss of principal, such as when the loan is delinquent or in the process of foreclosure. As described below, in determining the allowance for losses, the Company evaluates each loan on the watch list to determine if it is probable that amounts due will not be collected according to the contractual terms of the loan agreement. Loan-to-value and debt service coverage ratios are measures commonly used to assess the quality of commercial mortgage loans. The loan-to-value ratio compares the amount of the loan to the fair value of the underlying property collateralizing the loan, and is commonly expressed as a percentage. Loan-to-value ratios greater than 100% indicate that the loan amount exceeds the collateral value. A loan-to-value ratio less than 100% indicates an excess of collateral value over the loan amount. The debt service coverage ratio compares a property’s net operating income to its debt service payments. Debt service coverage ratios less than 1.0 times indicate that property operations do not generate enough income to cover the loan’s current debt payments. A debt service coverage ratio greater than 1.0 times indicates an excess of net operating income over the debt service payments. The values utilized in calculating these ratios are developed as part of the Company’s periodic review of the commercial mortgage loan and agricultural property loan portfolios, which includes an internal appraisal of the underlying collateral value. The Company’s periodic review also includes a quality re-rating process, whereby the internal quality rating originally assigned at underwriting is updated based on current loan, property and market information using a proprietary quality rating system. The loan-to-value ratio is the most significant of several inputs used to establish the internal credit rating of a loan which in turn drives the allowance for losses. Other key factors considered in determining the internal credit rating include debt service coverage ratios, amortization, loan term, and estimated market value growth rate and volatility for the property type and region. See Note 3 for additional information related to the loan-to-value ratios and debt service coverage ratios related to the Company’s commercial mortgage and agricultural loan portfolios. The allowance for losses includes a loan specific reserve for each impaired loan that has a specifically identified loss and a portfolio reserve for probable incurred but not specifically identified losses. For impaired commercial mortgage and other loans the allowances for losses are determined based on the present value of expected future cash flows discounted at the loan’s effective interest rate, or based upon the fair value of the collateral if the loan is collateral dependent. The portfolio reserves for probable incurred but not specifically identified losses in the commercial mortgage and agricultural loan portfolios consider the current credit composition of the portfolio based on an internal quality rating as described above. The portfolio reserves are determined using past loan experience, including historical credit migration, loss probability and loss severity factors by property type. These factors are reviewed and updated as appropriate. The allowance for losses on commercial mortgage and other loans can increase or decrease from period to period based on the factors noted above. “Realized investment gains (losses), net” includes changes in the allowance for losses. “Realized investment gains (losses), net” also includes gains and losses on sales, certain restructurings, and foreclosures. When a commercial mortgage or other loan is deemed to be uncollectible, any specific valuation allowance associated with the loan is reversed and a direct write down of the carrying amount of the loan is made. The carrying amount of the loan is not adjusted for subsequent recoveries in value. Commercial mortgage and other loans are occasionally restructured in a troubled debt restructuring. These restructurings generally include one or more of the following: full or partial payoffs outside of the original contract terms; changes to interest rates; extensions of maturity; or additions or modifications to covenants. Additionally, the Company may accept assets in full or partial satisfaction of the debt as part of a troubled debt restructuring. When restructurings occur, they are evaluated individually to determine whether the restructuring or modification constitutes a “troubled debt restructuring” as defined by authoritative accounting guidance. If the borrower is experiencing financial difficulty and the Company has granted a concession, the restructuring, including those that involve a partial payoff or the receipt of assets in full satisfaction of the debt is deemed to be a troubled debt restructuring. Based on the Company’s credit review process described above, these loans generally would have been deemed impaired prior to the troubled debt restructuring, and specific allowances for losses would have been established prior to the determination that a troubled debt restructuring has occurred. In a troubled debt restructuring where the Company receives assets in full satisfaction of the debt, any specific valuation allowance is reversed and a direct write-down of the loan is recorded for the amount of the allowance, and any additional loss, net of recoveries, or any gain is recorded for the difference between the fair value of the assets received and the recorded investment in the loan. When assets are received in partial settlement, the same process is followed, and the remaining loan is evaluated prospectively for impairment based on the credit review process noted above. When a loan is restructured in a troubled debt restructuring, the impairment of the loan is remeasured using the modified terms and the loan’s original effective yield, and the allowance for loss is adjusted accordingly. Subsequent to the modification, income is recognized prospectively based on the modified terms of the loans in accordance with the income recognition policy noted above. Additionally, the loan continues to be subject to the credit review process noted above. In situations where a loan has been restructured in a troubled debt restructuring and the loan has subsequently defaulted, this factor is considered when evaluating the loan for a specific allowance for losses in accordance with the credit review process noted above. See Note 3 for additional information about commercial mortgage and other loans that have been restructured in a troubled debt restructuring. 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. Short-term investments primarily consist of highly liquid debt instruments with a maturity of twelve months or less and greater than three months when purchased. These investments are generally carried at fair value or amortized cost that approximates fair value and include certain money market investments, funds managed similar to regulated money market funds, short-term debt securities issued by government sponsored entities and other highly liquid debt instruments. Other invested assets consist of the Company’s non-coupon investments in limited partnerships and limited liability companies ("LPs/LLCs") (other than operating joint ventures), derivative assets and other investments. LPs/LLCs interests are accounted for using either the equity method of accounting, or at fair value with changes in fair value reported in “Asset administration fees and other income”. The Company’s income from investments in LPs/LLCs accounted for using the equity method, other than the Company’s investments in operating joint ventures, is included in “Net investment income.” The carrying value of these investments is written down, or impaired, to fair value when a decline in value is considered to be other-than-temporary. In applying the equity method (including assessment for OTTI), the Company uses financial information provided by the investee, generally on a one to three-month lag. For the investments reported at fair value with changes in fair value reported in current earnings, the associated realized and unrealized gains and losses are reported in “Asset administration fees and other income”. Realized investment gains (losses) are computed using the specific identification method. Realized investment gains and losses are generated from numerous sources, including the sales of fixed maturity securities, investments in joint ventures and limited partnerships and other types of investments, as well as adjustments to the cost basis of investments for net OTTI recognized in earnings. Realized investment gains and losses also reflect changes in the allowance for losses on commercial mortgage and other loans, and fair value changes on embedded derivatives and free-standing derivatives that do not qualify for hedge accounting treatment. See “Derivative Financial Instruments” below for additional information regarding the accounting for derivatives. The Company’s available-for-sale securities with unrealized losses are reviewed quarterly to identify OTTI in value. In evaluating whether a decline in value is other-than-temporary, the Company considers several factors including, but not limited to the following: (1) the extent and the duration of the decline; (2) the reasons for the decline in value (credit event, currency or interest-rate related, including general credit spread widening); and (3) the financial condition of and near-term prospects of the issuer. An OTTI is recognized in earnings for a debt security in an unrealized loss position when the Company either (1) has the intent to sell the debt security or (2) it is more likely than not will be required to sell the debt security before its anticipated recovery. For all debt securities in unrealized loss positions that do not meet either of these two criteria, the Company analyzes its ability to recover the amortized cost by comparing the net present value of projected future cash flows with the amortized cost of the security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. The Company may use the estimated fair value of collateral as a proxy for the net present value if it believes that the security is dependent on the liquidation of collateral for recovery of its investment. If the net present value is less than the amortized cost of the investment an OTTI is recognized. When an OTTI of a debt security has occurred, the amount of the OTTI recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis. If the debt security meets either of these two criteria, the OTTI recognized in earnings is equal to the entire difference between the security’s amortized cost basis and its fair value at the impairment measurement date. For OTTI of debt securities that do not meet these criteria, the net amount recognized in earnings is equal to the difference between the amortized cost of the debt security and its net present value calculated as described above. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in OCI. Unrealized gains or losses on securities for which an OTTI has been recognized in earnings is tracked as a separate component of AOCI. The split between the amount of an OTTI recognized in OCI and the net amount recognized in earnings for debt securities is driven principally by assumptions regarding the amount and timing of projected cash flows. For mortgage-backed and asset-backed securities, cash flow estimates consider the payment terms of the underlying assets backing a particular security, including interest rate and prepayment assumptions, based on data from widely accepted third-party data sources or internal estimates. In addition to interest rate and prepayment assumptions, cash flow estimates also include other assumptions regarding the underlying collateral including default rates and recoveries, which vary based on the asset type and geographic location, as well as the vintage year of the security. For structured securities, the payment priority within the tranche structure is also considered. For all other debt securities, cash flow estimates are driven by assumptions regarding probability of default and estimates regarding timing and amount of recoveries associated with a default. The Company has developed these estimates using information based on its historical experience as well as using market observable data, such as industry analyst reports and forecasts, sector credit ratings and other data relevant to the collectability of a security, such as the general payment terms of the security and the security’s position within the capital structure of the issuer. The new cost basis of an impaired security is not adjusted for subsequent increases in estimated fair value. In periods subsequent to the recognition of an OTTI, the impaired security is accounted for as if it had been purchased on the measurement date of the impairment. For debt securities, the discount (or reduced premium) based on the new cost basis may be accreted into net investment income in future periods, including increases in cash flows on a prospective basis. In certain cases where there are decreased cash flow expectations, the security is reviewed for further cash flow impairments. Unrealized investment gains and losses are also considered in determining certain other balances, including DAC, VOBA, DSI, certain future policy benefits and deferred tax assets or liabilities. These balances are adjusted, as applicable, for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. Each of these balances is discussed in greater detail below. |
Cash and cash equivalents | Cash and cash equivalents |
Deferred policy acquisition costs | Deferred policy acquisition costs are directly related to the successful acquisition of new and renewal insurance and annuity business that have been deferred to the extent such costs are deemed recoverable from future profits. Such DAC primarily includes commissions, costs of policy issuance and underwriting, and certain other expenses that are directly related to successfully negotiated contracts. In each reporting period, capitalized DAC is amortized to “Amortization of DAC", net of the accrual of imputed interest on DAC balances. DAC is subject to periodic recoverability testing. DAC, for applicable products, is adjusted for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. DAC related to fixed and variable deferred annuity products are generally deferred and amortized over the expected life of the contracts in proportion to gross profits arising principally from investment margins, mortality and expense margins, and surrender charges, based on historical and anticipated future experience, which is updated periodically. The Company uses a reversion to the mean approach for equities to derive future equity return assumptions. However, if the projected equity return calculated using this approach is greater than the maximum equity return assumption, the maximum equity return is utilized. Gross profits also include impacts from the embedded derivatives associated with certain of the optional living benefit features of variable annuity contracts, and index-linked crediting features of fixed indexed annuity contracts and related hedging activities. In calculating gross profits, profits and losses related to contracts issued by the Company that are reported in affiliated legal entities other than the Company as a result of, for example, reinsurance agreements with those affiliated entities, are also included. The Company is an indirect subsidiary of Prudential Financial, a United States Securities and Exchange Commission (the "SEC") registrant, and has extensive transactions and relationships with other subsidiaries of Prudential Financial, including reinsurance agreements, as described in Note 10 . Incorporating all product-related profits and losses in gross profits, including those that are reported in affiliated legal entities, produces a DAC amortization pattern representative of the total economics of the products. Total gross profits include both actual gross profits and estimates of gross profits for future periods. The Company regularly evaluates and adjusts DAC balances with a corresponding charge or credit to current period earnings, representing a cumulative adjustment to all prior periods’ amortization, for the impact of actual gross profits and changes in the Company's projections of estimated future gross profits. Adjustments to DAC balances include: (i) annual review of assumptions that reflect the comprehensive review of the assumptions used in estimating gross profits for future periods, (ii) quarterly adjustments for current period experience (also referred to as “experience true-up” adjustments) that reflect the impact of differences between actual gross profits for a given period and the previously estimated expected gross profits for that period, and (iii) quarterly adjustments for market performance (also referred to as “experience unlocking”) that reflect the impact of changes to the Company's estimate of total gross profits to reflect actual fund performance and market conditions. For some products, policyholders can elect to modify product benefits, features, rights or coverages by exchanging a contract for a new contract or by amendment, endorsement, or rider to a contract, or by the election of a feature or coverage within a contract. These transactions are known as internal replacements. For internal replacement transactions, except those that involve the addition of a nonintegrated contract feature that does not change the existing base contract, the unamortized DAC is immediately charged to expense if the terms of the new policies are not substantially similar to those of the former policies. If the new terms are substantially similar to those of the earlier policies, the DAC is retained with respect to the new policies and amortized over the expected life of the new policies. See Note 6 for additional information regarding DAC. |
Accrued investment income | Accrued investment income primarily includes accruals of interest and dividend income from investments that have been earned but not yet received. |
Reinsurance recoverables and payables | Reinsurance payables include corresponding payables associated with reinsurance arrangements with affiliates. For additional information about these arrangements see Note 10 . Reinsurance recoverables include corresponding receivables associated with reinsurance arrangements with affiliates. For additional information about these arrangements see Note 10 . |
Income taxes | Income taxes asset primarily represents the net deferred tax asset and the Company’s estimated taxes receivable for the current year and open audit years. The Company is a member of the federal income tax return of Prudential Financial and primarily files separate company state and local tax returns. Pursuant to the tax allocation arrangement with Prudential Financial, total federal income tax expense is determined on a separate company basis. Members record tax benefits to the extent tax losses or tax credits are recognized in the consolidated federal tax provision. Items required by tax regulations to be included in the tax return may differ from the items reflected in the financial statements. As a result, the effective tax rate reflected in the financial statements may be different than the actual rate applied on the tax return. Some of these differences are permanent such as expenses that are not deductible in the Company’s tax return, and some differences are temporary, reversing over time, such as valuation of insurance reserves. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that can be used as a tax deduction or credit in future years for which the Company has already recorded the tax benefit in the Company’s Statements of Operations. Deferred tax liabilities generally represent tax expense recognized in the Company’s financial statements for which payment has been deferred, or expenditures for which the Company has already taken a deduction in the Company’s tax return but have not yet been recognized in the Company’s financial statements. Deferred income taxes are recognized, based on enacted rates, when assets and liabilities have different values for financial statement and tax reporting purposes. The application of U.S. GAAP requires the Company to evaluate the recoverability of the Company’s deferred tax assets and establish a valuation allowance if necessary to reduce the Company’s deferred tax assets to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. See Note 11 for a discussion of factors considered when evaluating the need for a valuation allowance. In December of 2017, SEC staff issued "SAB 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act" ("SAB 118"), which allowed registrants to record provisional amounts during a 'measurement period' not to extend beyond one year. Under the relief provided by SAB 118, a company could recognize provisional amounts when it did not have the necessary information available, prepared or analyzed in reasonable detail to complete its accounting for the change in tax law. See Note 11 for a discussion of provisional amounts related to The United States Tax Cuts and Jobs Act of 2017 ("Tax Act of 2017") recorded in 2017 and adjustments to provisional amounts recorded in 2018. U.S. GAAP prescribes a comprehensive model for how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that a company has taken or expects to take on tax returns. The application of this guidance is a two-step process. First, the Company determines whether it is more likely than not, based on the technical merits, that the tax position will be sustained upon examination. If a tax position does not meet the more likely than not recognition threshold, the benefit of that position is not recognized in the financial statements. The second step is measurement. The Company measures the tax position as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate resolution with a taxing authority that has full knowledge of all relevant information. This measurement considers the amounts and probabilities of the outcomes that could be realized upon ultimate settlement using the facts, circumstances, and information available at the reporting date. The Company’s liability for income taxes includes a liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by the Internal Revenue Service (“IRS”) or other taxing jurisdictions. Audit periods remain open for review until the statute of limitations has passed. Generally, for tax years which produce net operating losses, capital losses or tax credit carryforwards (“tax attributes”), the statute of limitations does not close, to the extent of these tax attributes, until the expiration of the statute of limitations for the tax year in which they are fully utilized. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the liability for income taxes. The Company classifies all interest and penalties related to tax uncertainties as income tax expense. See Note 11 for additional information regarding income taxes. Effective January 1, 2018, the Company adopted ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (Loss) , which allowed a reclassification from AOCI to retained earnings for stranded effects resulting from the Tax Act of 2017. The Company elected to apply the ASU subsequent to recording the adoption impacts of ASU 2016-01 as described above. As a result, the Company reclassified stranded effects resulting from the Tax Act of 2017 by decreasing AOCI and increasing retained earnings, each by $36.7 million upon adoption on January 1, 2018. Stranded effects unrelated to the Tax Act of 2017 are generally released from AOCI when an entire portfolio of the type of item related to the stranded effect is liquidated, sold or extinguished (i.e., portfolio approach). |
VOBA | VOBA represents identifiable intangible assets to which a portion of the purchase price in a business acquisition is attributed under the application of purchase accounting. VOBA represents an adjustment to the stated value of in force insurance contract liabilities to present them at fair value, determined as of the acquisition date. VOBA balances are subject to recoverability testing, in the manner in which it was acquired. The Company has established a VOBA asset primarily for its acquisition of American Skandia Life Assurance Corporation. The Company amortizes VOBA over the anticipated life of the acquired contracts using the same methodology and assumptions used to amortize DAC. The Company records amortization of VOBA in “General, administrative, and other expenses.” See Note 7 for additional information regarding VOBA. |
Deferred sales inducements | Deferred sales inducements represent various types of sales inducements to contractholders related to fixed and variable deferred annuity contracts. The Company defers sales inducements and amortizes them over the expected life of the policy using the same methodology and assumptions used to amortize DAC. Sales inducement balances are subject to periodic recoverability testing. The Company records amortization of DSI in “Interest credited to policyholders’ account balances.” DSI for applicable products is adjusted for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. See Note 9 for additional information regarding sales inducements. |
Other assets and Other liabilities | Other liabilities consist primarily of accrued expenses, technical overdrafts, deferred gain on reinsurance, and payables resulting from purchases of securities that had not yet settled at the balance sheet date. Other liabilities may also include derivative instruments for which fair values are determined as described below under “Derivative Financial Instruments”. Other assets consist primarily of accruals for asset administration fees, deferred loss on reinsurance with an affiliate and receivables resulting from sales of securities that had not yet settled at the balance sheet date. |
Separate account assets and liabilities | Separate account liabilities primarily represent the contractholders’ account balance in separate account assets and to a lesser extent borrowings of the separate account, and will be equal and offsetting to total separate account assets. See also “ Separate account assets” above. Separate account assets represent segregated funds that are invested for certain contractholders. The contractholder has the option of directing funds to a wide variety of investment options, most of which invest in mutual funds. The investment risk on the variable portion of a contract is borne by the contractholder, except to the extent of minimum guarantees by the Company, which are not separate account liabilities. The assets of each account are legally segregated and are not subject to claims that arise out of any other business of the Company. The investment income and realized investment gains or losses from separate accounts generally accrue to the contractholders and are not included in the Company’s results of operations. Mortality, policy administration and surrender charges assessed against the accounts are included in “Policy charges and fee income”. Asset administration fees charged to the accounts are included in “Asset administration fees and other income”. See Note 9 for additional information regarding separate account arrangements with contractual guarantees. See also “ Separate account liabilities” below. |
Future policy benefits | Future policy benefits liability is primarily comprised of liabilities for guarantee benefits related to certain long-duration life and annuity contracts, which are discussed more fully in Note 9 . These reserves represent reserves for the guaranteed minimum death and optional living benefit features on the Company’s variable annuity products. The optional living benefits are primarily accounted for as embedded derivatives, with fair values calculated as the present value of future expected benefit payments to customers less the present value of assessed rider fees attributable to the embedded derivative feature. For additional information regarding the valuation of these optional living benefit features, see Note 5 . The Company’s liability for future policy benefits also includes reserves based on the present value of estimated future payments to or on behalf of policyholders, where the timing and amount of payment depends on policyholder mortality. Expected mortality is generally based on Company experience, industry data, and/or other factors. Interest rate assumptions are based on factors such as market conditions and expected investment returns. Although mortality, morbidity and interest rate assumptions are “locked-in” upon the issuance of new insurance or annuity business with fixed and guaranteed terms, significant changes in experience or assumptions may require the Company to provide for expected future losses on a product by recognizing a premium deficiency. A premium deficiency exists when the liability for future policy benefits plus the present value of expected future gross premiums are determined to be insufficient to provide for expected future policy benefits and expenses. If a premium deficiency is recognized, the assumptions without a provision for the risk of adverse deviation as of the premium deficiency test date are locked-in and used in subsequent valuations. The net reserves continue to be subject to premium deficiency testing. Any adjustments to future policy benefit reserves related to net unrealized gains on securities classified as available-for-sale are included in AOCI. See Note 8 for additional information regarding future policy benefits. |
Policyholders' account balances | Policyholders’ account balances liability represents the contract value that has accrued to the benefit of the policyholder as of the balance sheet date. This liability is primarily associated with the accumulated account deposits, plus interest credited, less policyholder withdrawals and other charges assessed against the account balance, as applicable. These policyholders’ account balances also include provision for benefits under non-life contingent payout annuities. See Note 8 for additional information regarding policyholders’ account balances. |
Cash collateral for loaned securities | Cash collateral for loaned securities represent liabilities to return cash proceeds from security lending transactions. Securities lending transactions are used primarily to earn spread income or to facilitate trading activity. As part of securities lending transactions, the Company transfers U.S. and foreign debt and equity securities, as well as U.S. government and government agency securities, and receives cash as collateral. Cash proceeds from securities lending transactions are primarily used to earn spread income, and are typically invested in cash equivalents, short-term investments or fixed maturities. Securities lending transactions are treated as financing arrangements and are recorded at the amount of cash received. The Company obtains collateral in an amount equal to 102% and 105% |
Securities sold under agreements to repurchase | Securities sold under agreements to repurchase represent liabilities associated with securities repurchase agreements which are used primarily to earn spread income. As part of securities repurchase agreements, the Company transfers U.S. government and government agency securities to a third-party and receives cash as collateral. For securities repurchase agreements, the cash received is typically invested in cash equivalents, short-term investments or fixed maturities. Receivables associated with securities purchased under agreements to resell are generally reflected as cash equivalents (see also "Cash and cash equivalents" above). As part of securities resale agreements, the Company invests cash and receives as collateral U.S. government securities or other debt securities. Securities repurchase and resale agreements that satisfy certain criteria are treated as secured borrowing or secured lending arrangements. These agreements are carried at the amounts at which the securities will be subsequently resold or reacquired, as specified in the respective transactions. For securities purchased under agreements to resell, the Company’s policy is to take possession or control of the securities either directly or through a third-party custodian. These securities are valued daily and additional securities or cash collateral is received, or returned, when appropriate to protect against credit exposure. Securities to be resold are the same, or substantially the same, as the securities received. The majority of these transactions are with large brokerage firms and large banks. For securities sold under agreements to repurchase, the market value of the securities to be repurchased is monitored, and additional collateral is obtained where appropriate, to protect against credit exposure. The Company obtains collateral in an amount at least equal to 95% |
Short-term and long-term debt | Short-term and long-term debt liabilities are primarily carried at an amount equal to unpaid principal balance, net of unamortized discount or premium and debt issue costs. Original-issue discount or premium and debt-issue costs are recognized as a component of interest expense over the period the debt is expected to be outstanding, using the interest method of amortization. Interest expense is generally presented within “General, administrative and other expenses” in the Company’s Statements of Operations. Short-term debt is debt coming due in the next twelve months, including that portion of debt otherwise classified as long-term. The short-term debt caption may exclude short-term debt items for which the Company has the intent and ability to refinance on a long-term basis in the near term. See Note 14 for additional information regarding short-term and long-term debt. |
Commitments and contingent liabilities | Commitments and contingent liabilities |
Insurance Revenue and Expense Recognition | Insurance Revenue and Expense Recognition Revenues for variable deferred annuity contracts consist of charges against contractholder account values or separate accounts for mortality and expense risks, administration fees, surrender charges and an annual maintenance fee per contract. Revenues for mortality and expense risk charges and administration fees are recognized as assessed against the contractholder. Surrender charge revenue is recognized when the surrender charge is assessed against the contractholder at the time of surrender. Liabilities for the variable investment options on annuity contracts represent the account value of the contracts and are included in “Separate account liabilities”. Revenues for variable immediate annuity and supplementary contracts with life contingencies consist of certain charges against contractholder account values including mortality and expense risks and administration fees. These charges and fees are recognized as revenue when assessed against the contractholder. Liabilities for variable immediate annuity contracts represent the account value of the contracts and are included in “Separate account liabilities”. Revenues for fixed immediate annuity and fixed supplementary contracts with and without life contingencies consist of net investment income. In addition, revenues for fixed immediate annuity contracts with life contingencies also consist of single premium payments recognized as annuity considerations when received. Reserves for contracts without life contingencies are included in “Policyholders’ account balances” while reserves for contracts with life contingencies are included in “Future policy benefits.” Assumed interest rates ranged from 0.0% to 8.3% at December 31, 2019 and 2018 . Revenues for variable life insurance contracts consist of charges against contractholder account values or separate accounts for expense charges, administration fees, cost of insurance charges and surrender charges. Certain contracts also include charges against premium to pay state premium taxes. All of these charges are recognized as revenue when assessed against the contractholder. Liabilities for variable life insurance contracts represent the account value of the contracts and are included in “Separate account liabilities”. Certain individual annuity contracts provide the contractholder a guarantee that the benefit received upon death or annuitization will be no less than a minimum prescribed amount. These benefits are accounted for as insurance contracts and are discussed in further detail in Note 9 . The Company also provides contracts with certain optional living benefits which are considered embedded derivatives. See Note 5 for information regarding the valuation of these embedded derivatives and Note 9 for additional information regarding these contracts. Amounts received as payment for variable annuities and other contracts without life contingencies are reported as deposits to “Policyholders’ account balances” and/or “Separate account liabilities.” Revenues from these contracts are reflected in “Policy charges and fee income” consisting primarily of fees assessed during the period against the policyholders’ account balances for policy administration charges and surrender charges. In addition to fees, the Company earns investment income from the investments in the Company’s general account portfolio. Fees assessed that represent compensation to the Company for services to be provided in future periods and certain other fees are generally deferred and amortized into revenue over the life of the related contracts in proportion to estimated gross profits. Benefits and expenses for these products include claims in excess of related account balances, expenses of contract administration, interest credited to policyholders’ account balances and amortization of DAC, DSI and VOBA. Policyholders’ account balances also include amounts representing the fair value of embedded derivative instruments associated with the index-linked features of certain fixed annuity products. For additional information regarding the valuation of these embedded derivatives, see Note 5 . |
Asset administration fees and other income | Asset administration fees and other income principally includes asset-based asset management fees, which are recognized in the period in which the services are performed. This financial statement line also includes realized and unrealized gains or losses from investments reported as “Fixed maturities, trading, at fair value”, “Equity securities, at fair value”, and “Other invested assets” that are measured at fair value. |
Derivative Financial Instruments | Derivative Financial Instruments Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices, values of securities or commodities, credit spreads, market volatility, expected returns, and liquidity. Values can also be affected by changes in estimates and assumptions, including those related to counterparty behavior and non-performance risk ("NPR") used in valuation models. Derivative financial instruments generally used by the Company include swaps, futures, forwards and options and may be exchange-traded or contracted in the over-the-counter ("OTC") market. Certain of the Company's OTC derivatives are cleared and settled through central clearing counterparties, while others are bilateral contracts between two counterparties. Derivative positions are carried at fair value, generally by obtaining quoted market prices or through the use of valuation models. Derivatives are used to manage the interest rate and currency characteristics of assets or liabilities. Additionally, derivatives may be used to seek to reduce exposure to interest rate, credit, foreign currency and equity risks associated with assets held or expected to be purchased or sold, and liabilities incurred or expected to be incurred. As discussed in detail below and in Note 4 , all realized and unrealized changes in fair value of derivatives are recorded in current earnings, with the exception of cash flow hedges. Cash flows from derivatives are reported in the operating, investing, or financing activities sections in the Statements of Cash Flows based on the nature and purpose of the derivative. Derivatives are recorded either as assets, within “Other invested assets,” or as liabilities, within “Payables to parent and affiliates,” except for embedded derivatives which are recorded with the associated host contract. The Company nets the fair value of all derivative financial instruments with counterparties for which a master netting arrangement has been executed. The Company designates derivatives as either (1) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (“cash flow” hedge); or (2) a derivative that does not qualify for hedge accounting. To qualify for hedge accounting treatment, a derivative must be highly effective in mitigating the designated risk of the hedged item. Effectiveness of the hedge is formally assessed at inception and throughout the life of the hedging relationship. The Company formally documents at inception all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking various hedge transactions. This process includes linking all derivatives designated as cash flow hedges to specific assets and liabilities on the balance sheet or to specific firm commitments or forecasted transactions. When a derivative is designated as a cash flow hedge and is determined to be highly effective, changes in its fair value are recorded in AOCI until earnings are affected by the variability of cash flows being hedged (e.g., when periodic settlements on a variable-rate asset or liability are recorded in earnings). At that time, the related portion of deferred gains or losses on the derivative instrument is reclassified and reported in the Statements of Operations line item associated with the hedged item. If it is determined that a derivative no longer qualifies as an effective cash flow hedge or management removes the hedge designation, the derivative will continue to be carried on the balance sheet at its fair value, with changes in fair value recognized currently in “Realized investment gains (losses), net.” The component of AOCI related to discontinued cash flow hedges is reclassified to the Statements of Operations line associated with the hedged cash flows consistent with the earnings impact of the original hedged cash flows. When hedge accounting is discontinued because the hedged item no longer meets the definition of a firm commitment, or because it is probable that the forecasted transaction will not occur by the end of the specified time period, the derivative will continue to be carried on the balance sheet at its fair value, with changes in fair value recognized currently in “Realized investment gains (losses), net.” Any asset or liability that was recorded pursuant to recognition of the firm commitment is removed from the balance sheet and recognized currently in “Realized investment gains (losses), net.” Gains and losses that were in AOCI pursuant to the cash flow hedge of a forecasted transaction are recognized immediately in “Realized investment gains (losses), net”. If a derivative does not qualify for hedge accounting, all changes in its fair value, including net receipts and payments, are included in “Realized investment gains (losses), net” without considering changes in the fair value of the economically associated assets or liabilities. The Company is a party to financial instruments that contain derivative instruments that are “embedded” in the financial instruments. At inception, the Company assesses whether the economic characteristics of the embedded instrument are clearly and closely related to the economic characteristics of the remaining component of the financial instrument (i.e., the host contract) and whether a separate instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. When it is determined that (1) the embedded instrument possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and (2) a separate instrument with the same terms would qualify as a derivative instrument, the embedded instrument qualifies as an embedded derivative that is separated from the host contract, carried at fair value, and changes in its fair value are included in “Realized investment gains (losses), net.” For certain financial instruments that contain an embedded derivative that otherwise would need to be bifurcated and reported at fair value, the Company may elect to carry the entire instrument at fair value and report it within “Fixed maturities, trading, at fair value" or "Equity securities, at fair value". The Company sold variable annuity contracts that include optional living benefit features that may be treated from an accounting perspective as embedded derivatives. The Company had reinsurance agreements to transfer the risks related to certain of these benefit features to affiliates, Pruco Re and Prudential Insurance through March 31, 2016. Effective April 1, 2016, the Company recaptured the risks related to its variable annuity optional living benefit guarantees that were previously reinsured to Pruco Re and Prudential Insurance. In addition, the Company reinsured the variable annuity base contracts, along with the living benefit guarantees, from Pruco Life, excluding the PLNJ business which was reinsured to Prudential Insurance, under a coinsurance and modified coinsurance agreement. See Note 1 and 10 for additional information. The embedded derivatives related to the living benefit features and the related reinsurance agreements are carried at fair value and included in “Future policy benefits” and “Reinsurance recoverables,” respectively. Changes in the fair value are determined using valuation models as described in Note 5 , and are recorded in “Realized investment gains (losses), net.” |
Adoption of New Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of Accounting Standards Updates ("ASUs") to the FASB Accounting Standards Codification ("ASC"). The Company considers the applicability and impact of all ASUs. ASUs listed below include those that have been adopted during the current fiscal year and/or those that have been issued but not yet adopted as of December 31, 2019 and as of the date of this filing. ASUs not listed below were assessed and determined to be either not applicable or not material. ASU adopted during the year ended December 31, 2019 Standard Description Effective date and method of adoption Effect on the financial statements or other significant matters ASU 2017-08 , Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20) Premium Amortization on Purchased Callable Debt Securities This ASU requires certain premiums on callable debt securities to be amortized to the earliest call date. January 1, 2019 using the modified retrospective method which included cumulative-effect adjustment on the balance sheet as of the beginning of the fiscal year of adoption. Adoption of the ASU did not have a significant impact on the Financial Statements and Notes to the Financial Statements. The impact of the cumulative-effect adjustment to retained earnings was immaterial. ASU 2017-12, Derivatives and This ASU makes targeted changes to the existing hedge accounting model to better portray the economics of an entity’s risk management activities and to simplify the use of hedge accounting. The ASU eliminates separate measurement and recording of hedge ineffectiveness. It requires entities to present the earnings effect of the hedging instrument in the same income statement line item in which the hedged item is reported and also requires expanded disclosures. January 1, 2019 using the modified retrospective method which included cumulative-effect adjustment on the balance sheet as of the beginning of the fiscal year of adoption. Adoption of the ASU did not have a significant impact on the Financial Statements and Notes to the Financial Statements. The impact of the cumulative-effect adjustment to retained earnings and AOCI related to ineffectiveness of the hedge instruments outstanding at the date of the adoption was immaterial. See Note 4 for additional required disclosures. |
Future Adoption Of New Accounting Pronouncements | ASU issued but not yet adopted as of December 31, 2019 — ASU 2018-12 ASU 2018-12, Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts, was issued by the FASB on August 15, 2018 and is expected to have a significant impact on the Company’s Financial Statements and Notes to the Financial Statements. In October 2019, the FASB issued ASU 2019-09, Financial Services - Insurance (Topic 944): Effective Date to affirm its decision to defer the effective date of ASU 2018-12 to January 1, 2022 (with early adoption permitted), representing a one year extension from the original effective date of January 1, 2021. This ASU will impact, at least to some extent, the accounting and disclosure requirements for all long-duration insurance and investment contracts issued by the Company. Outlined below are four key areas of change, although there are other less significant changes not noted below. In addition to the impacts to the balance sheet upon adoption, the Company also expects an impact to how earnings emerge thereafter. ASU 2018-12 Amended Topic Description Method of adoption Effect on the financial statements or other significant matters Cash flow assumptions used to measure the liability for future policy benefits for non-participating traditional and limited-pay insurance products Requires an entity to review, and if necessary, update the cash flow assumptions used to measure the liability for future policy benefits, for both changes in future assumptions and actual experience, at least annually using a retrospective update method with a cumulative catch-up adjustment recorded in a separate line item in the Statements of Operations. An entity may choose one of two adoption methods for the liability for future policy benefits: (1) a modified retrospective transition method whereby the entity will apply the amendments to contracts in force as of the beginning of the earliest period presented on the basis of their existing carrying amounts, adjusted for the removal of any related amounts in AOCI or (2) a full retrospective transition method. The options for method of adoption and the impacts of such methods are under assessment. Discount rate assumption used to measure the liability for future policy benefits for non-participating traditional and limited-pay insurance products Requires discount rate assumptions to be based on an upper-medium grade fixed income instrument yield and will be required to be updated each quarter with the impact recorded through OCI. As noted above, an entity may choose either a modified retrospective transition method or full retrospective transition method for the liability for future policy benefits. Under either method, for balance sheet remeasurement purposes, the liability for future policy benefits will be remeasured using current discount rates as of the beginning of the earliest period presented with the impact recorded as a cumulative effect adjustment to AOCI. Upon adoption, under either transition method, there will be an adjustment to AOCI as a result of remeasuring in force contract liabilities using current upper-medium grade fixed income instrument yields. The adjustment upon adoption will largely reflect the difference between the discount rate locked-in at contract inception versus current discount rates at transition. The magnitude of such adjustment is currently being assessed. Amortization of DAC and other balances Requires DAC and other balances, such as unearned revenue reserves and DSI, to be amortized on a constant level basis over the expected term of the related contract, independent of expected profitability. An entity may apply one of two adoption methods: (1) a modified retrospective transition method whereby the entity will apply the amendments to contracts in force as of the beginning of the earliest period presented on the basis of their existing carrying amounts, adjusted for the removal of any related amounts in AOCI or (2) if an entity chooses a full retrospective transition method for its liability for future policy benefits, as described above, it is required to also use a retrospective transition method for DAC and other balances. The options for method of adoption and the impacts of such methods are under assessment. Under the modified retrospective transition method, the Company would not expect a significant impact to the balance sheet, other than the impact of the removal of any related amounts in AOCI. Market Risk Benefits Requires an entity to measure all market risk benefits (e.g., living benefit and death benefit guarantees associated with variable annuities) at fair value, and record market risk benefit assets and liabilities separately on the Statements of Financial Position. Changes in fair value of market risk benefits are recorded in net income, except for the portion of the change that is attributable to changes in an entity’s non-performance risk ("NPR"), which is recognized in OCI. An entity shall adopt the guidance for market risk benefits using the retrospective transition method, which includes a cumulative-effect adjustment on the balance sheet as of the earliest period presented. An entity shall maximize the use of relevant observable information and minimize the use of unobservable information in determining the balance of the market risk benefits upon adoption. Upon adoption, the Company expects an impact to retained earnings for the difference between the fair value and carrying value of benefits not currently measured at fair value (e.g., Guaranteed Minimum Death Benefits ("GMDB") on variable annuities) and an impact from reclassifying the cumulative effect of changes in NPR from retained earnings to AOCI. The magnitude of such adjustments is currently being assessed. Other ASUs issued but not yet adopted as of December 31, 2019 Standard Description Effective date and method of adoption Effect on the financial statements or other significant matters ASU 2016-13 , This ASU provides a new current expected credit loss model to account for credit losses on certain financial assets and off-balance sheet exposures (e.g., loans held for investment, debt securities held to maturity, reinsurance receivables, net investments in leases and loan commitments). The model requires an entity to estimate lifetime credit losses related to such financial assets and exposures based on relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The standard also modifies the current OTTI standard for available-for-sale debt securities to require the use of an allowance rather than a direct write down of the investment, and replaces existing standard for purchased credit deteriorated loans and debt securities. January 1, 2020 using the modified retrospective method which will include a cumulative-effect adjustment on the balance sheet as of the beginning of the fiscal year of adoption. However, prospective application is required for purchased credit deteriorated assets previously accounted for under ASC 310-30 and for debt securities for which an OTTI was recognized prior to the date of adoption. Early adoption was permitted beginning January 1, 2019. Adoption of this guidance will result in 1) the recognition of an allowance for credit losses based on the current expected credit loss model on financial assets carried at amortized cost and certain off-balance sheet credit exposures; and 2) related adjustments to retained earnings. We expect the cumulative impact of the adoption to retained earnings, primarily attributable to the reserves for commercial mortgage and other loans, to be immaterial. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investments [Abstract] | |
Fixed Maturities, Available-for-sale Securities | The following tables set forth the composition of fixed maturity securities (excluding investments classified as trading), as of the dates indicated: December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value OTTI in AOCI(3) (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 6,667,347 $ 491,943 $ 39,466 $ 7,119,824 $ 0 Obligations of U.S. states and their political subdivisions 252,304 7,814 436 259,682 0 Foreign government bonds 203,386 19,518 20 222,884 0 U.S. public corporate securities 1,615,060 126,947 1,331 1,740,676 0 U.S. private corporate securities 1,159,962 50,720 3,343 1,207,339 0 Foreign public corporate securities 321,111 16,989 113 337,987 0 Foreign private corporate securities 1,171,411 50,069 7,995 1,213,485 0 Asset-backed securities(1) 443,767 3,405 2,734 444,438 (20 ) Commercial mortgage-backed securities 557,584 20,941 236 578,289 0 Residential mortgage-backed securities(2) 73,814 3,960 13 77,761 0 Total fixed maturities, available-for-sale $ 12,465,746 $ 792,306 $ 55,687 $ 13,202,365 $ (20 ) (1) Includes credit-tranched securities collateralized by loan obligations, sub-prime mortgages, auto loans, equipment leases and education loans. (2) Includes publicly-traded agency pass-through securities and collateralized mortgage obligations. (3) Represents the amount of unrealized losses remaining in AOCI, from the impairment measurement date. Amount excludes $14.3 million of net unrealized gains on impaired available-for-sale securities relating to changes in the value of such securities subsequent to the impairment measurement date. December 31, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value OTTI in AOCI(3) (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 5,240,519 $ 20,065 $ 376,493 $ 4,884,091 $ 0 Obligations of U.S. states and their political subdivisions 133,670 621 3,127 131,164 0 Foreign government bonds 199,044 4,748 4,156 199,636 0 U.S. public corporate securities 1,498,130 26,425 50,582 1,473,973 0 U.S. private corporate securities 1,070,400 15,430 22,877 1,062,953 0 Foreign public corporate securities 296,029 1,888 6,831 291,086 0 Foreign private corporate securities 829,588 10,415 27,771 812,232 0 Asset-backed securities(1) 505,862 3,147 3,765 505,244 (16 ) Commercial mortgage-backed securities 364,601 2,770 5,491 361,880 0 Residential mortgage-backed securities(2) 48,622 1,290 498 49,414 0 Total fixed maturities, available-for-sale $ 10,186,465 $ 86,799 $ 501,591 $ 9,771,673 $ (16 ) (1) Includes credit-tranched securities collateralized by loan obligations, sub-prime mortgages, auto loans, equipment leases, education loans and other asset types. (2) Includes publicly-traded agency pass-through securities and collateralized mortgage obligations. (3) Represents the amount of unrealized losses remaining in AOCI, from the impairment measurement date. Amount excludes $3.3 million of net unrealized losses on impaired available-for-sale securities relating to changes in the value of such securities subsequent to the impairment measurement date. |
Duration Of Gross Unrealized Losses On Fixed Maturity Securities | The following tables set forth the fair value and gross unrealized losses aggregated by investment category and length of time that individual fixed maturity securities had been in a continuous unrealized loss position, as of the dates indicated: December 31, 2019 Less Than Twelve Months Twelve Months or More Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 1,336,007 $ 39,456 $ 5,855 $ 10 $ 1,341,862 $ 39,466 Obligations of U.S. states and their political subdivisions 97,752 436 0 0 97,752 436 Foreign government bonds 804 13 132 7 936 20 U.S. public corporate securities 93,147 870 15,491 461 108,638 1,331 U.S. private corporate securities 82,709 2,111 59,797 1,232 142,506 3,343 Foreign public corporate securities 50,150 113 0 0 50,150 113 Foreign private corporate securities 97,414 1,652 91,863 6,343 189,277 7,995 Asset-backed securities 103,911 717 235,759 2,017 339,670 2,734 Commercial mortgage-backed securities 66,071 236 0 0 66,071 236 Residential mortgage-backed securities 633 12 7 1 640 13 Total fixed maturities, available-for-sale $ 1,928,598 $ 45,616 $ 408,904 $ 10,071 $ 2,337,502 $ 55,687 December 31, 2018 Less Than Twelve Months Twelve Months or More Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in thousands) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government authorities and agencies $ 367,796 $ 4,844 $ 3,304,663 $ 371,649 $ 3,672,459 $ 376,493 Obligations of U.S. states and their political subdivisions 25,764 322 83,950 2,805 109,714 3,127 Foreign government bonds 98,437 2,346 58,975 1,810 157,412 4,156 U.S. public corporate securities 627,589 28,474 386,599 22,108 1,014,188 50,582 U.S. private corporate securities 269,545 7,755 422,498 15,122 692,043 22,877 Foreign public corporate securities 97,367 2,521 107,286 4,310 204,653 6,831 Foreign private corporate securities 373,891 19,217 116,743 8,554 490,634 27,771 Asset-backed securities 358,668 3,501 24,529 264 383,197 3,765 Commercial mortgage-backed securities 45,432 355 159,638 5,136 205,070 5,491 Residential mortgage-backed securities 34 1 13,775 497 13,809 498 Total fixed maturities, available-for-sale $ 2,264,523 $ 69,336 $ 4,678,656 $ 432,255 $ 6,943,179 $ 501,591 |
Investments Classified by Contractual Maturity Date | The following table sets forth the amortized cost and fair value of fixed maturities by contractual maturities, as of the date indicated: December 31, 2019 Amortized Cost Fair Value (in thousands) Fixed maturities, available-for-sale: Due in one year or less $ 90,826 $ 91,258 Due after one year through five years 1,116,306 1,149,228 Due after five years through ten years 1,762,440 1,862,864 Due after ten years 8,421,009 8,998,527 Asset-backed securities 443,767 444,438 Commercial mortgage-backed securities 557,584 578,289 Residential mortgage-backed securities 73,814 77,761 Total fixed maturities, available-for-sale $ 12,465,746 $ 13,202,365 |
Sources of Fixed Maturity Proceeds, Realized Investment Gains (Losses), and Losses on Impairments | The following table sets forth the sources of fixed maturity proceeds and related investment gains (losses), as well as losses on impairments of fixed maturities, for the periods indicated: Years Ended December 31, 2019 2018 2017 (in thousands) Fixed maturities, available-for-sale: Proceeds from sales(1) $ 384,592 $ 2,126,886 $ 517,743 Proceeds from maturities/prepayments 468,004 404,679 630,140 Gross investment gains from sales and maturities 3,259 21,129 8,992 Gross investment losses from sales and maturities (3,364 ) (98,047 ) (3,047 ) OTTI recognized in earnings(2) (3,826 ) (6,813 ) (9,122 ) (1) Includes $0.0 million , $(2.9) million and $2.5 million of non-cash related proceeds due to the timing of trade settlements for the years ended December 31, 2019 , 2018 and 2017 , respectively. (2) Excludes the portion of OTTI amounts remaining in OCI, representing any difference between the fair value of the impaired debt security and the net present value of its projected future cash flows at the time of the impairment. |
Credit Losses Recognized in Earnings on Fixed Maturity Securities Held by the Company for which a Portion of the OTTI Loss was Recognized in OCI | The following table sets forth a rollforward of pre-tax amounts remaining in OCI related to fixed maturity securities with credit loss impairments recognized in earnings, for the periods indicated: Years Ended December 31, 2019 2018 (in thousands) Credit loss impairments: Balance in OCI, beginning of period $ (209 ) $ 792 New credit loss impairments 1,343 0 Increases due to the passage of time on previously recorded credit losses 10 3 Reductions for securities which matured, paid down, prepaid or were sold during the period 223 (40 ) Reductions for securities impaired to fair value during the period (1,351 ) (963 ) Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected (2 ) (1 ) Balance in OCI, end of period $ 14 $ (209 ) |
Commercial Mortgage and Other Loans | The following table sets forth the composition of “Commercial mortgage and other loans,” as of the dates indicated: December 31, 2019 December 31, 2018 Amount (in thousands) % of Total Amount (in thousands) % of Total Commercial mortgage and agricultural property loans by property type: Apartments/Multi-Family $ 272,150 18.5 % $ 304,644 22.4 % Hospitality 16,819 1.1 3,633 0.3 Industrial 464,528 31.5 355,758 26.2 Office 372,823 25.3 305,537 22.5 Other 156,768 10.6 137,781 10.2 Retail 131,051 8.9 194,646 14.4 Total commercial mortgage loans 1,414,139 95.9 1,301,999 96.0 Agricultural property loans 60,046 4.1 54,375 4.0 Total commercial mortgage and agricultural property loans by property type 1,474,185 100.0 % 1,356,374 100.0 % Allowance for credit losses (2,663 ) (2,896 ) Total commercial mortgage and other loans $ 1,471,522 $ 1,353,478 |
Allowance for Credit Losses | The following table sets forth the activity in the allowance for credit losses for commercial mortgage and other loans, as of the dates indicated: Commercial Mortgage Loans Agricultural Property Loans Total (in thousands) Balance at December 31, 2016 $ 2,267 $ 22 $ 2,289 Addition to (release of) allowance for credit losses 349 12 361 Charge-offs, net of recoveries 0 0 0 Balance at December 31, 2017 2,616 34 2,650 Addition to (release of) allowance for credit losses 245 1 246 Charge-offs, net of recoveries 0 0 0 Balance at December 31, 2018 2,861 35 2,896 Addition to (release of) allowance for credit losses (239 ) 6 (233 ) Charge-offs, net of recoveries 0 0 0 Balance at December 31, 2019 $ 2,622 $ 41 $ 2,663 |
Allowance for Credit Losses and Recorded Investment in Commercial Mortgage and Other Loans | The following tables set forth the allowance for credit losses and the recorded investment in commercial mortgage and other loans, as of the dates indicated: December 31, 2019 Commercial Mortgage Loans Agricultural Property Loans Total (in thousands) Allowance for credit losses: Individually evaluated for impairment $ 0 $ 0 $ 0 Collectively evaluated for impairment 2,622 41 2,663 Total ending balance(1) $ 2,622 $ 41 $ 2,663 Recorded investment(2): Individually evaluated for impairment $ 0 $ 0 $ 0 Collectively evaluated for impairment 1,414,139 60,046 1,474,185 Total ending balance(1) $ 1,414,139 $ 60,046 $ 1,474,185 (1) As of December 31, 2019 , there were no loans acquired with deteriorated credit quality. (2) Recorded investment reflects the carrying value gross of related allowance. December 31, 2018 Commercial Mortgage Loans Agricultural Property Loans Total (in thousands) Allowance for credit losses: Individually evaluated for impairment $ 0 $ 0 $ 0 Collectively evaluated for impairment 2,861 35 2,896 Total ending balance(1) $ 2,861 $ 35 $ 2,896 Recorded investment(2): Individually evaluated for impairment $ 0 $ 3,439 $ 3,439 Collectively evaluated for impairment 1,301,999 50,936 1,352,935 Total ending balance(1) $ 1,301,999 $ 54,375 $ 1,356,374 (1) As of December 31, 2018 , there were no loans acquired with deteriorated credit quality. (2) Recorded investment reflects the carrying value gross of related allowance. |
Financing Receivable Credit Quality Indicators | The following tables set forth certain key credit quality indicators for commercial mortgage and agricultural property loans based upon the recorded investment gross of allowance for credit losses, as of the dates indicated: December 31, 2019 Debt Service Coverage Ratio > 1.2X 1.0X to <1.2X < 1.0X Total (in thousands) Loan-to-Value Ratio: 0%-59.99% $ 715,654 $ 6,641 $ 3,609 $ 725,904 60%-69.99% 499,493 14,078 0 513,571 70%-79.99% 203,158 30,555 0 233,713 80% or greater 0 997 0 997 Total commercial mortgage and agricultural property loans $ 1,418,305 $ 52,271 $ 3,609 $ 1,474,185 December 31, 2018 Debt Service Coverage Ratio > 1.2X 1.0X to <1.2X < 1.0X Total (in thousands) Loan-to-Value Ratio: 0%-59.99% $ 709,342 $ 14,814 $ 345 $ 724,501 60%-69.99% 442,308 23,260 0 465,568 70%-79.99% 156,049 7,236 0 163,285 80% or greater 2,000 1,020 0 3,020 Total commercial mortgage and agricultural property loans $ 1,309,699 $ 46,330 $ 345 $ 1,356,374 |
Aging of Past Due Commercial Mortgage and Other Loans and Nonaccrual Status | The following tables set forth an aging of past due commercial mortgage and other loans based upon the recorded investment gross of allowance for credit losses, as well as the amount of commercial mortgage and other loans on non-accrual status, as of the dates indicated: December 31, 2019 Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due(1) Total Loans Non-Accrual Status(2) (in thousands) Commercial mortgage loans $ 1,414,139 $ 0 $ 0 $ 0 $ 1,414,139 $ 0 Agricultural property loans 60,046 0 0 0 60,046 0 Total $ 1,474,185 $ 0 $ 0 $ 0 $ 1,474,185 $ 0 (1) As of December 31, 2019 , there were no loans in this category accruing interest. (2) For additional information regarding the Company’s policies for accruing interest on loans, see Note 2 . December 31, 2018 Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due(1) Total Loans Non-Accrual Status(2) (in thousands) Commercial mortgage loans $ 1,301,999 $ 0 $ 0 $ 0 $ 1,301,999 $ 0 Agricultural property loans 54,375 0 0 0 54,375 0 Total $ 1,356,374 $ 0 $ 0 $ 0 $ 1,356,374 $ 0 (1) As of December 31, 2018 , there were no loans in this category accruing interest. (2) For additional information regarding the Company’s policies for accruing interest on loans, see Note 2 . |
Other Invested Assets | The following table sets forth the composition of “Other invested assets,” as of the dates indicated: December 31, 2019 2018 (in thousands) LPs/LLCs: Equity method: Private equity $ 23,414 $ 23,844 Hedge funds 273,615 179,014 Real estate-related 166,492 94,738 Subtotal equity method 463,521 297,596 Fair value: Private equity 4,115 4,142 Hedge funds 194 263 Real estate-related 6,181 3,562 Subtotal fair value 10,490 7,967 Total LPs/LLCs 474,011 305,563 Derivative instruments 2 42,978 Total other invested assets $ 474,013 $ 348,541 |
Net Investment Income | The following table sets forth “Net investment income” by investment type, for the periods indicated: Years Ended December 31, 2019 2018 2017 (in thousands) Fixed maturities, available-for-sale $ 389,165 $ 317,726 $ 332,148 Fixed maturities, trading 10,080 5,184 4,360 Equity securities, at fair value 568 678 567 Commercial mortgage and other loans 51,628 51,040 48,598 Policy loans 630 737 1,069 Short-term investments and cash equivalents 85,084 28,645 31,505 Other invested assets 34,422 13,733 20,626 Gross investment income 571,577 417,743 438,873 Less: investment expenses (20,029 ) (14,935 ) (16,064 ) Net investment income $ 551,548 $ 402,808 $ 422,809 |
Realized Gain (Loss) on Investments, Net | The following table sets forth “Realized investment gains (losses), net” by investment type, for the periods indicated: Years Ended December 31, 2019 2018 2017 (in thousands) Fixed maturities(1) $ (3,931 ) $ (83,731 ) $ (3,177 ) Commercial mortgage and other loans (753 ) 128 (840 ) LPs/LLCs 0 0 (39 ) Derivatives (2,677,559 ) 967,503 (801,429 ) Other invested assets 164 123 0 Short-term investments and cash equivalents 759 50 85 Realized investment gains (losses), net $ (2,681,320 ) $ 884,073 $ (805,400 ) (1) Includes fixed maturity securities classified as available-for-sale and excludes fixed maturity securities classified as trading. |
Unrealized Gains and (Losses) on Investments | The following table sets forth net unrealized gains (losses) on investments, as of the dates indicated: December 31, 2019 2018 2017 (in thousands) Fixed maturity securities, available-for-sale — with OTTI $ 14,309 $ (3,334 ) $ 12,311 Fixed maturity securities, available-for-sale — all other 722,310 (411,458 ) (46,791 ) Equity securities, available-for-sale(1) 0 0 4 Derivatives designated as cash flow hedges(2) (287 ) (3,849 ) (25,851 ) Affiliated notes 598 658 829 Other investments 0 1,074 86 Net unrealized gains (losses) on investments $ 736,930 $ (416,909 ) $ (59,412 ) (1) Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded within “Asset administration fees and other income (loss).” (2) For more information on cash flow hedges, see Note 4 . |
Repurchase Agreements and Securities Lending | The following table sets forth the composition of “Cash collateral for loaned securities,” which represents the liability to return cash collateral received for the following types of securities loaned, as of the dates indicated: December 31, 2019 December 31, 2018 Remaining Contractual Maturities of the Agreements Remaining Contractual Maturities of the Agreements Overnight & Continuous Up to 30 Days Total Overnight & Continuous Up to 30 Days Total (in thousands) Foreign government bonds $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 U.S. public corporate securities 0 0 0 384 0 384 Total cash collateral for loaned securities(1) $ 0 $ 0 $ 0 $ 384 $ 0 $ 384 (1) The Company did no t have agreements with remaining contractual maturities of thirty days or greater, as of the dates indicated. |
Securities Pledged | The following table sets forth the carrying value of investments pledged to third parties and the carrying amount of the associated liabilities supported by the pledged collateral, as of the dates indicated: December 31, 2019 2018 (in thousands) Pledged collateral: Fixed maturity securities, available-for-sale $ 0 $ 365 Total securities pledged $ 0 $ 365 Liabilities supported by the pledged collateral: Cash collateral for loaned securities $ 0 $ 384 Total liabilities supported by the pledged collateral $ 0 $ 384 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The table below provides a summary of the gross notional amount and fair value of derivative contracts by the primary underlying risks, excluding embedded derivatives and associated reinsurance recoverables. Many derivative instruments contain multiple underlying risks. The fair value amounts below represent the value of derivative contracts prior to taking into account the netting effects of master netting agreements and cash collateral. December 31, 2019 December 31, 2018 Primary Underlying Risk/Instrument Type Gross Notional Fair Value Gross Notional Fair Value Assets Liabilities Assets Liabilities (in thousands) Derivatives Designated as Hedge Accounting Instruments: Currency/Interest Rate Foreign Currency Swaps $ 1,172,899 $ 39,019 $ (26,511 ) $ 768,075 $ 33,348 $ (21,794 ) Total Derivatives Designated as Hedge Accounting Instruments $ 1,172,899 $ 39,019 $ (26,511 ) $ 768,075 $ 33,348 $ (21,794 ) Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate Interest Rate Futures $ 3,857,700 $ 638 $ (5,872 ) $ 908,100 $ 4,380 $ (664 ) Interest Rate Swaps 88,557,425 6,598,625 (1,997,944 ) 82,172,825 3,344,033 (1,395,270 ) Interest Rate Options 12,583,000 283,386 (172,085 ) 19,255,000 139,765 (245,523 ) Interest Rate Forwards 959,772 24,487 (4,185 ) 1,713,947 56,562 (1,976 ) Foreign Currency Foreign Currency Forwards 16,683 0 (394 ) 19,467 287 (27 ) Currency/Interest Rate Foreign Currency Swaps 234,767 11,482 (663 ) 231,245 11,659 (2,850 ) Equity Equity Futures 1,191,237 0 (2,638 ) 860,718 0 (6,629 ) Total Return Swaps 16,314,165 36,692 (573,957 ) 14,456,836 986,130 (53,235 ) Equity Options 12,866,043 329,722 (422,700 ) 26,861,807 271,630 (412,821 ) Total Derivatives Not Qualifying as Hedge Accounting Instruments $ 136,580,792 $ 7,285,032 $ (3,180,438 ) $ 146,479,945 $ 4,814,446 $ (2,118,995 ) Total Derivatives (1)(2) $ 137,753,691 $ 7,324,051 $ (3,206,949 ) $ 147,248,020 $ 4,847,794 $ (2,140,789 ) (1) Excludes embedded derivatives and associated reinsurance recoverables which contain multiple underlying risks. The fair value of these embedded derivatives was a net liability of $11,823 million and $8,332 million as of December 31, 2019 and 2018 , respectively included in “Future policy benefits” and $197 million and $42 million as of December 31, 2019 and 2018 , respectively included in “Policyholders’ account balances". Other assets included $8 million and $0 million as of December 31, 2019 and 2018 , respectively. The fair value of the related reinsurance, included in "Reinsurance recoverables" and/or "Reinsurance payables" was an asset of $350 million and $240 million as of December 31, 2019 and 2018 , respectively. (2) Recorded in “Other invested assets”, “Other liabilities”, and "Payables to parent and affiliates" on the Statements of Financial Position. |
Offsetting of Financial Assets | The following table presents recognized derivative instruments (excluding embedded derivatives and associated reinsurance recoverables), and repurchase and reverse repurchase agreements, that are offset in the Statements of Financial Position, and/or are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in the Statements of Financial Position. December 31, 2019 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statement of Financial Position Net Amounts Presented in the Statement of Financial Position Financial Instruments/ Collateral(1) Net Amount (in thousands) Offsetting of Financial Assets: Derivatives(1) $ 7,324,051 $ (7,324,049 ) $ 2 $ 0 $ 2 Securities purchased under agreements to resell 302,000 0 302,000 (302,000 ) 0 Total Assets $ 7,626,051 $ (7,324,049 ) $ 302,002 $ (302,000 ) $ 2 Offsetting of Financial Liabilities: Derivatives(1) $ 3,206,949 $ (3,053,132 ) $ 153,817 $ (820 ) $ 152,997 Securities sold under agreements to repurchase 0 0 0 0 0 Total Liabilities $ 3,206,949 $ (3,053,132 ) $ 153,817 $ (820 ) $ 152,997 December 31, 2018 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statement of Financial Position Net Amounts Presented in the Statement of Financial Position Financial Instruments/ Collateral(1) Net Amount (in thousands) Offsetting of Financial Assets: Derivatives(1) $ 4,847,794 $ (4,804,816 ) $ 42,978 $ 0 $ 42,978 Securities purchased under agreements to resell 675,000 0 675,000 (675,000 ) 0 Total Assets $ 5,522,794 $ (4,804,816 ) $ 717,978 $ (675,000 ) $ 42,978 Offsetting of Financial Liabilities: Derivatives(1) $ 2,140,789 $ (2,134,160 ) $ 6,629 $ (6,629 ) $ 0 Securities sold under agreements to repurchase 0 0 0 0 0 Total Liabilities $ 2,140,789 $ (2,134,160 ) $ 6,629 $ (6,629 ) $ 0 (1) Amounts exclude the excess of collateral received/pledged from/to the counterparty. |
Offsetting of Financial Liabilities | The following table presents recognized derivative instruments (excluding embedded derivatives and associated reinsurance recoverables), and repurchase and reverse repurchase agreements, that are offset in the Statements of Financial Position, and/or are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in the Statements of Financial Position. December 31, 2019 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statement of Financial Position Net Amounts Presented in the Statement of Financial Position Financial Instruments/ Collateral(1) Net Amount (in thousands) Offsetting of Financial Assets: Derivatives(1) $ 7,324,051 $ (7,324,049 ) $ 2 $ 0 $ 2 Securities purchased under agreements to resell 302,000 0 302,000 (302,000 ) 0 Total Assets $ 7,626,051 $ (7,324,049 ) $ 302,002 $ (302,000 ) $ 2 Offsetting of Financial Liabilities: Derivatives(1) $ 3,206,949 $ (3,053,132 ) $ 153,817 $ (820 ) $ 152,997 Securities sold under agreements to repurchase 0 0 0 0 0 Total Liabilities $ 3,206,949 $ (3,053,132 ) $ 153,817 $ (820 ) $ 152,997 December 31, 2018 Gross Amounts of Recognized Financial Instruments Gross Amounts Offset in the Statement of Financial Position Net Amounts Presented in the Statement of Financial Position Financial Instruments/ Collateral(1) Net Amount (in thousands) Offsetting of Financial Assets: Derivatives(1) $ 4,847,794 $ (4,804,816 ) $ 42,978 $ 0 $ 42,978 Securities purchased under agreements to resell 675,000 0 675,000 (675,000 ) 0 Total Assets $ 5,522,794 $ (4,804,816 ) $ 717,978 $ (675,000 ) $ 42,978 Offsetting of Financial Liabilities: Derivatives(1) $ 2,140,789 $ (2,134,160 ) $ 6,629 $ (6,629 ) $ 0 Securities sold under agreements to repurchase 0 0 0 0 0 Total Liabilities $ 2,140,789 $ (2,134,160 ) $ 6,629 $ (6,629 ) $ 0 (1) |
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | s. The following tables provide the financial statement classification and impact of derivatives used in qualifying and non-qualifying hedge relationships, excluding the offset of the hedged item in an effective hedge relationship. Year Ended December 31, 2019 Realized Investment Gains (Losses) Net Investment Income Other Income AOCI(1) (in thousands) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ (1,257 ) $ 12,104 $ (3,793 ) $ 3,520 Total cash flow hedges (1,257 ) 12,104 (3,793 ) 3,520 Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate 3,309,573 0 0 0 Currency (153 ) 0 0 0 Currency/Interest Rate 11,964 0 15 0 Credit 1,775 0 0 0 Equity (3,730,006 ) 0 0 0 Embedded Derivatives (2,269,455 ) 0 0 0 Total Derivatives Not Qualifying as Hedge Accounting Instruments (2,676,302 ) 0 15 0 Total $ (2,677,559 ) $ 12,104 $ (3,778 ) $ 3,520 Year Ended December 31, 2018(2) Realized Investment Gains (Losses) Net Investment Income Other Income AOCI(1) (in thousands) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ (845 ) $ 8,285 $ 13,321 $ 22,002 Total cash flow hedges (845 ) 8,285 13,321 22,002 Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate (1,021,687 ) 0 0 0 Currency 1,022 0 0 0 Currency/Interest Rate 21,888 0 91 0 Credit 0 0 0 0 Equity 995,958 0 0 0 Embedded Derivatives 971,167 0 0 0 Total Derivatives Not Qualifying as Hedge Accounting Instruments 968,348 0 91 0 Total $ 967,503 $ 8,285 $ 13,412 $ 22,002 Year Ended December 31, 2017(2) Realized Investment Gains (Losses) Net Investment Income Other Income AOCI(1) (in thousands) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ 3,052 $ 6,152 $ (11,043 ) $ (37,596 ) Total cash flow hedges 3,052 6,152 (11,043 ) (37,596 ) Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate 550,797 0 0 0 Currency (454 ) 0 0 0 Currency/Interest Rate (33,225 ) 0 (183 ) 0 Credit 0 0 0 0 Equity (2,000,297 ) 0 0 0 Embedded Derivatives 678,698 0 0 0 Total Derivatives Not Qualifying as Hedge Accounting Instruments (804,481 ) 0 (183 ) 0 Total $ (801,429 ) $ 6,152 $ (11,226 ) $ (37,596 ) (1) Net change in AOCI. (2) Prior period amounts have been updated to conform to current period presentation. |
Schedule of Derivative Instruments Recognized in Accumulated Other Comprehensive Income(Loss) Before Taxes | Presented below is a rollforward of current period cash flow hedges in AOCI before taxes: (in thousands) Balance, December 31, 2016 $ 11,745 Amount recorded in AOCI Currency/Interest Rate (39,434 ) Total amount recorded in AOCI (39,434 ) Amount reclassified from AOCI to income Currency/Interest Rate 1,838 Total amount reclassified from AOCI to income 1,838 Balance, December 31, 2017 $ (25,851 ) Amount recorded in AOCI Currency/Interest Rate 42,763 Total amount recorded in AOCI 42,763 Amount reclassified from AOCI to income Currency/Interest Rate (20,761 ) Total amount reclassified from AOCI to income (20,761 ) Balance, December 31, 2018 $ (3,849 ) Cumulative-effect adjustment from the adoption of ASU 2017-12(1) 42 Amount recorded in AOCI Currency/Interest Rate 10,574 Total amount recorded in AOCI 10,574 Amount reclassified from AOCI to income Currency/Interest Rate (7,054 ) Total amount reclassified from AOCI to income (7,054 ) Balance, December 31, 2019 $ (287 ) (1) See Note 2 for details. |
Fair Value of Assets and Liab_2
Fair Value of Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets and Liabilities Measured on Recurring Basis | The tables below present the balances of assets and liabilities reported at fair value on a recurring basis, as of the dates indicated. As of December 31, 2019 Level 1 Level 2 Level 3 Netting(1) Total (in thousands) Fixed maturities, available-for-sale: U.S Treasury securities and obligations of U.S. government authorities and agencies $ 0 $ 7,109,277 $ 10,547 $ 0 $ 7,119,824 Obligations of U.S. states and their political subdivisions 0 259,682 0 0 259,682 Foreign government bonds 0 222,884 0 0 222,884 U.S. corporate public securities 0 1,732,632 8,044 0 1,740,676 U.S. corporate private securities 0 1,155,464 51,875 0 1,207,339 Foreign corporate public securities 0 337,800 187 0 337,987 Foreign corporate private securities 0 1,169,324 44,161 0 1,213,485 Asset-backed securities(2) 0 425,613 18,825 0 444,438 Commercial mortgage-backed securities 0 578,289 0 0 578,289 Residential mortgage-backed securities 0 77,761 0 0 77,761 Subtotal 0 13,068,726 133,639 0 13,202,365 Fixed maturities, trading 0 378,734 4,464 0 383,198 Equity securities 5,314 46,942 5,247 0 57,503 Short-term investments 0 260,354 0 0 260,354 Cash equivalents 150,631 1,654,974 0 0 1,805,605 Other invested assets(3) 639 7,323,412 0 (7,324,049 ) 2 Other assets 0 0 8,059 0 8,059 Reinsurance recoverables 0 47,006 302,814 0 349,820 Receivables from parent and affiliates 0 2,573 0 0 2,573 Subtotal excluding separate account assets 156,584 22,782,721 454,223 (7,324,049 ) 16,069,479 Separate account assets(4) 0 32,665,431 0 0 32,665,431 Total assets $ 156,584 $ 55,448,152 $ 454,223 $ (7,324,049 ) $ 48,734,910 Future policy benefits(5) $ 0 $ 0 $ 11,822,998 $ 0 $ 11,822,998 Policyholders' account balances 0 0 196,892 0 196,892 Payables to parent and affiliates 0 3,198,440 0 (3,052,493 ) 145,947 Other liabilities 8,509 260 0 (639 ) 8,130 Total liabilities $ 8,509 $ 3,198,700 $ 12,019,890 $ (3,053,132 ) $ 12,173,967 As of December 31, 2018 Level 1 Level 2 Level 3 Netting (1) Total (in thousands) Fixed maturities, available-for-sale: U.S Treasury securities and obligations of U.S. government authorities and agencies $ 0 $ 4,875,959 $ 8,132 $ 0 $ 4,884,091 Obligations of U.S. states and their political subdivisions 0 131,164 0 0 131,164 Foreign government bonds 0 199,636 0 0 199,636 U.S. corporate public securities 0 1,473,973 0 0 1,473,973 U.S. corporate private securities 0 1,008,632 54,321 0 1,062,953 Foreign corporate public securities 0 291,086 0 0 291,086 Foreign corporate private securities 0 781,101 31,131 0 812,232 Asset-backed securities(2) 0 495,908 9,336 0 505,244 Commercial mortgage-backed securities 0 361,880 0 0 361,880 Residential mortgage-backed securities 0 49,414 0 0 49,414 Subtotal 0 9,668,753 102,920 0 9,771,673 Fixed maturities, trading 0 289,752 0 0 289,752 Equity securities 4,896 12 5,705 0 10,613 Short-term investments 0 29,818 0 0 29,818 Cash equivalents 1,098,903 2,593,456 0 0 3,692,359 Other invested assets(3) 4,380 4,843,414 0 (4,804,816 ) 42,978 Other assets 0 0 0 0 0 Reinsurance recoverables 0 0 239,911 0 239,911 Receivables from parent and affiliates 0 37,193 0 0 37,193 Subtotal excluding separate account assets 1,108,179 17,462,398 348,536 (4,804,816 ) 14,114,297 Separate account assets(4) 0 31,210,346 0 0 31,210,346 Total assets $ 1,108,179 $ 48,672,744 $ 348,536 $ (4,804,816 ) $ 45,324,643 Future policy benefits(5) $ 0 $ 0 $ 8,332,474 $ 0 $ 8,332,474 Policyholders' account balances 0 0 42,350 0 42,350 Payables to parent and affiliates 0 2,133,496 0 (2,133,496 ) 0 Other liabilities 7,293 0 0 (664 ) 6,629 Total liabilities $ 7,293 $ 2,133,496 $ 8,374,824 $ (2,134,160 ) $ 8,381,453 (1) “Netting” amounts represent cash collateral of $4,271 million and $2,671 million as of December 31, 2019 and 2018 , respectively. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) Other invested assets excluded from the fair value hierarchy include certain hedge funds, private equity funds and other funds for which fair value is measured at net asset value ("NAV") per share (or its equivalent) as a practical expedient. At December 31, 2019 and 2018 , the fair values of such investments were $ 10.5 million and $ 8.0 million , respectively. (4) Separate account assets represent segregated funds that are invested for certain customers. Investment risks associated with market value changes are borne by the customers, except to the extent of minimum guarantees made by the Company with respect to certain accounts. Separate account liabilities are not included in the above table as they are reported at contract value and not fair value in Statements of Financial Position. (5) As of December 31, 2019 , the net embedded derivative liability position of $11,823 million includes $583 million of embedded derivatives in an asset position and $12,406 million of embedded derivatives in a liability position. As of December 31, 2018 , the net embedded derivative liability position of $8,332 million includes $625 million of embedded derivatives in an asset position and $8,957 million of embedded derivatives in a liability position. |
Fair Value Inputs, Assets and Liabilities, Quantitative Information | The tables below present quantitative information on significant internally-priced Level 3 assets and liabilities. As of December 31, 2019 Fair Value Valuation Techniques Unobservable Inputs Minimum Maximum Weighted Average Impact of Increase in Input on Fair Value(1) (in thousands) Assets: Corporate securities(2) $ 17,149 Discounted cash flow Discount rate 4.79 % 20 % 8.66 % Decrease Market Comparables EBITDA multiples(3) 6.7 X 6.7 X 6.7 X Increase Reinsurance recoverables $ 302,814 Fair values are determined using the same unobservable inputs as future policy benefits. Liabilities: Future policy benefits(4) $ 11,822,998 Discounted cash flow Lapse rate(6) 1 % 18 % Decrease Spread over LIBOR(7) 0.10 % 1.23 % Decrease Utilization rate(8) 43 % 97 % Increase Withdrawal rate See table footnote (9) below. Mortality rate(10) 0 % 15 % Decrease Equity volatility curve 13 % 23 % Increase Policyholders' account balances(5) $ 196,892 Discounted cash flow Lapse rate(6) 1 % 42 % Decrease Spread over LIBOR(7) 0.10 % 1.23 % Decrease Equity volatility curve 6 % 25 % Increase As of December 31, 2018 Fair Value Valuation Techniques Unobservable Inputs Minimum Maximum Weighted Average Impact of Increase in Input on Fair Value (1) (in thousands) Assets: Corporate securities(2) $ 18,609 Discounted cash flow Discount rate 7 % 20 % 11.30 % Decrease Market Comparables EBITDA multiples(3) 6.7 X 6.7 X 6.7 X Increase Liquidation Liquidation value 41 % 41 % 41 % Increase Reinsurance recoverables $ 239,911 Fair values are determined using the same unobservable inputs as future policy benefits. Liabilities: Future policy benefits(4) $ 8,332,474 Discounted cash flow Lapse rate(6) 1 % 13 % Decrease Spread over LIBOR(7) 0.36 % 1.60 % Decrease Utilization rate(8) 50 % 97 % Increase Withdrawal rate See table footnote (9) below. Mortality rate(10) 0 % 15 % Decrease Equity volatility curve 18 % 22 % Increase (1) Conversely, the impact of a decrease in input would have the opposite impact on fair value as that presented in the table. (2) Includes assets classified as fixed maturities, available-for-sale and fixed maturities trading. (3) Represents multiples of earnings before interest, taxes, depreciation and amortization ("EBITDA"), and are amounts used when the Company has determined that market participants would use such multiples when valuing the investments. (4) Future policy benefits primarily represent general account liabilities for the living benefit features of the Company’s variable annuity contracts which are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than a weighted average, is a more meaningful representation of the unobservable inputs used in the valuation. (5) Policyholders’ account balances primarily represent general account liabilities for the index-linked interest credited on certain of the Company’s annuity products that are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than a weighted average, is a more meaningful representation of the unobservable inputs used in the valuation. (6) Lapse rates for contracts with living benefit guarantees are adjusted at the contract level based on the in-the-moneyness of the living benefit and reflect other factors, such as the applicability of any surrender charges. Lapse rates are reduced when contracts are more in-the-money. Lapse rates for contracts with index-linked crediting guarantees may be adjusted at the contract level based on the applicability of any surrender charges, product type, and market related factors such as interest rates. Lapse rates are also generally assumed to be lower for the period where surrender charges apply. For any given contract, lapse rates vary throughout the period over which cash flows are projected for the purposes of valuing these embedded derivatives. (7) The spread over the LIBOR swap curve represents the premium added to the proxy for the risk-free rate (LIBOR) to reflect the Company's estimates of rates that a market participant would use to value the living benefits in both the accumulation and payout phases and index-linked interest crediting guarantees. This spread includes an estimate of NPR, which is the risk that the obligation will not be fulfilled by the Company. NPR is primarily estimated by utilizing the credit spreads associated with issuing funding agreements, adjusted for any illiquidity risk premium. In order to reflect the financial strength ratings of the Company, credit spreads associated with funding agreements, as opposed to credit spread associated with debt, are utilized in developing this estimate because funding agreements, living benefit guarantees, and index-linked interest crediting guarantees are insurance liabilities and are therefore senior to debt. (8) The utilization rate assumption estimates the percentage of contracts that will utilize the benefit during the contract duration and begin lifetime withdrawals at various time intervals from contract inception. The remaining contractholders are assumed to either begin lifetime withdrawals immediately or never utilize the benefit. Utilization assumptions may vary by product type, tax status and age. The impact of changes in these assumptions is highly dependent on the product type, the age of the contractholder at the time of the sale, and the timing of the first lifetime income withdrawal. Range reflects the utilization rate for the vast majority of business with living benefits. (9) The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. These assumptions vary based on the age of the contractholder, the tax status of the contract and the duration since the contractholder began lifetime withdrawals. As of both December 31, 2019 and 2018 , the minimum withdrawal rate assumption is 78% and the maximum withdrawal rate assumption may be greater than 100% . The fair value of the liability will generally increase the closer the withdrawal rate is to 100% and decrease as the withdrawal rate moves further away from 100%. (10) The range reflects the mortality rates for the vast majority of business with living benefits, with policyholders ranging from 45 to 90 years old. While the majority of living benefits have a minimum age requirement, certain other contracts do not have an age restriction. This results in contractholders with mortality rates approaching 0% for certain benefits. Mortality rates may vary by product, age, and duration. A mortality improvement assumption is also incorporated into the overall mortality table. |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables describe changes in fair values of Level 3 assets and liabilities as of the dates indicated, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods. When a determination is made to classify assets and liabilities within Level 3, the determination is based on significance of the unobservable inputs in the overall fair value measurement. All transfers are based on changes in the observability of the valuation inputs, including the availability of pricing service information that the Company can validate. Transfers into Level 3 are generally the result of unobservable inputs utilized within valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company can validate. Year Ended December 31, 2019 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other(2) Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(3) (in thousands) Fixed maturities, available-for-sale: U.S. Government $ 8,132 $ 0 $ 2,415 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 10,547 $ 0 Corporate Securities(4) 85,452 (1,123 ) 61,563 0 0 (43,724 ) 0 4,655 (2,556 ) 104,267 (3,797 ) Structured Securities(5) 9,336 502 44,273 0 0 (5,259 ) 0 551 (30,578 ) 18,825 (2 ) Other assets: Fixed maturities, trading 0 (557 ) 0 0 0 0 0 5,021 0 4,464 (543 ) Equity securities 5,705 471 0 (929 ) 0 0 0 0 0 5,247 482 Other invested assets 0 0 0 0 0 0 0 0 0 0 0 Short-term investments 0 0 0 0 0 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 0 0 0 0 0 Other assets 0 441 7,618 0 0 0 0 0 0 8,059 441 Reinsurance recoverables 239,911 70,063 17,950 0 0 0 21,896 0 (47,006 ) 302,814 57,652 Liabilities: Future policy benefits (8,332,474 ) (2,409,958 ) 0 0 (1,080,566 ) 0 0 0 0 (11,822,998 ) (2,710,167 ) Policyholders' account balances(6) (42,350 ) (32,247 ) 0 0 (122,295 ) 0 0 0 0 (196,892 ) (22,699 ) Year Ended December 31, 2019 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, available-for-sale $ (3,562 ) $ 0 $ 2,690 $ 251 $ (3,799 ) $ 0 Other assets: Fixed maturities, trading 0 (543 ) 0 (14 ) 0 (543 ) Equity securities 0 471 0 0 0 482 Other invested assets 0 0 0 0 0 0 Short-term investments 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 Other assets 441 0 0 0 441 0 Reinsurance recoverables 70,063 0 0 0 57,652 0 Liabilities: Future policy benefits (2,409,958 ) 0 0 0 (2,710,167 ) 0 Policyholders' account balances (32,247 ) 0 0 0 (22,699 ) 0 Year Ended December 31, 2018 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other(2) Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(3) (in thousands) Fixed maturities, available-for-sale: U.S. Government $ 5,237 $ 0 $ 2,895 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 8,132 $ 0 Corporate Securities(4) 95,206 (10,922 ) 15,268 (275 ) 0 (22,332 ) 24 9,969 (1,486 ) 85,452 (6,627 ) Structured Securities(5) 185,358 (724 ) 84,810 (14,236 ) 0 (37,672 ) 0 51,979 (260,179 ) 9,336 0 Other assets: Fixed maturities, trading 0 0 0 0 0 0 0 0 0 0 0 Equity securities 9,758 (591 ) 0 (3,609 ) 0 0 147 0 0 5,705 (1,208 ) Other invested assets 147 0 0 0 0 0 (147 ) 0 0 0 0 Short-term investments 87 (20 ) 0 0 0 (43 ) (24 ) 0 0 0 (55 ) Cash equivalents 0 13 0 0 0 (13 ) 0 0 0 0 0 Other assets 0 0 0 0 0 0 0 0 0 0 0 Reinsurance recoverables 244,006 (28,757 ) 19,061 0 0 0 5,601 0 0 239,911 (19,962 ) Liabilities: Future policy benefits (8,151,902 ) 843,914 0 0 (1,024,486 ) 0 0 0 0 (8,332,474 ) 529,804 Policyholders' account balances(6) 0 6,051 0 0 (48,401 ) 0 0 0 0 (42,350 ) 6,051 Year Ended December 31, 2018 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, available-for-sale $ (6,693 ) $ 0 $ (5,194 ) $ 241 $ (6,627 ) $ 0 Other assets: Fixed maturities, trading 0 0 0 0 0 0 Equity securities 0 (591 ) 0 0 0 (1,208 ) Other invested assets 0 0 0 0 0 0 Short-term investments (20 ) 0 0 0 (55 ) 0 Cash equivalents 13 0 0 0 0 0 Other assets 0 0 0 0 0 0 Reinsurance recoverables (28,757 ) 0 0 0 (19,962 ) 0 Liabilities: Future policy benefits 843,914 0 0 0 529,804 0 Policyholders' account balances 6,051 0 0 0 6,051 0 The following tables summarize the portion of changes in fair values of Level 3 assets and liabilities included in earnings and OCI for the year ended December 31, 2017 , as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held as of December 31, 2017 . Year Ended December 31, 2017 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, available-for-sale $ (6,301 ) $ 0 $ (3,410 ) $ 8,057 $ (6,506 ) $ 0 Other assets: Fixed maturities, trading 0 0 0 0 0 0 Equity securities 0 689 351 0 0 338 Other invested assets (7 ) 0 0 0 (7 ) 0 Short-term investments 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 Other assets 0 0 0 0 0 0 Reinsurance recoverables (18,240 ) 0 0 0 (10,303 ) 0 Liabilities: Future policy benefits 552,047 0 0 0 307,529 0 Policyholders' account balances 0 0 0 0 0 0 (1) Realized investment gains (losses) on future policy benefits and reinsurance recoverables primarily represent the change in the fair value of the Company's living benefit guarantees on certain of its variable annuity contracts. (2) Other includes reclassifications of certain assets and liabilities between reporting categories. (3) Unrealized gains or losses related to assets still held at the end of the period do not include amortization or accretion of premiums and discounts. (4) Includes U.S. corporate public, U.S. corporate private, foreign corporate public and foreign corporate private securities. (5) Includes asset-backed, commercial mortgage-backed and residential mortgage-backed securities. (6) Issuances and settlements for Policyholders' account balances are presented net in the rollforward. |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables describe changes in fair values of Level 3 assets and liabilities as of the dates indicated, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods. When a determination is made to classify assets and liabilities within Level 3, the determination is based on significance of the unobservable inputs in the overall fair value measurement. All transfers are based on changes in the observability of the valuation inputs, including the availability of pricing service information that the Company can validate. Transfers into Level 3 are generally the result of unobservable inputs utilized within valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company can validate. Year Ended December 31, 2019 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other(2) Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(3) (in thousands) Fixed maturities, available-for-sale: U.S. Government $ 8,132 $ 0 $ 2,415 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 10,547 $ 0 Corporate Securities(4) 85,452 (1,123 ) 61,563 0 0 (43,724 ) 0 4,655 (2,556 ) 104,267 (3,797 ) Structured Securities(5) 9,336 502 44,273 0 0 (5,259 ) 0 551 (30,578 ) 18,825 (2 ) Other assets: Fixed maturities, trading 0 (557 ) 0 0 0 0 0 5,021 0 4,464 (543 ) Equity securities 5,705 471 0 (929 ) 0 0 0 0 0 5,247 482 Other invested assets 0 0 0 0 0 0 0 0 0 0 0 Short-term investments 0 0 0 0 0 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 0 0 0 0 0 Other assets 0 441 7,618 0 0 0 0 0 0 8,059 441 Reinsurance recoverables 239,911 70,063 17,950 0 0 0 21,896 0 (47,006 ) 302,814 57,652 Liabilities: Future policy benefits (8,332,474 ) (2,409,958 ) 0 0 (1,080,566 ) 0 0 0 0 (11,822,998 ) (2,710,167 ) Policyholders' account balances(6) (42,350 ) (32,247 ) 0 0 (122,295 ) 0 0 0 0 (196,892 ) (22,699 ) Year Ended December 31, 2019 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, available-for-sale $ (3,562 ) $ 0 $ 2,690 $ 251 $ (3,799 ) $ 0 Other assets: Fixed maturities, trading 0 (543 ) 0 (14 ) 0 (543 ) Equity securities 0 471 0 0 0 482 Other invested assets 0 0 0 0 0 0 Short-term investments 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 Other assets 441 0 0 0 441 0 Reinsurance recoverables 70,063 0 0 0 57,652 0 Liabilities: Future policy benefits (2,409,958 ) 0 0 0 (2,710,167 ) 0 Policyholders' account balances (32,247 ) 0 0 0 (22,699 ) 0 Year Ended December 31, 2018 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other(2) Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(3) (in thousands) Fixed maturities, available-for-sale: U.S. Government $ 5,237 $ 0 $ 2,895 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 8,132 $ 0 Corporate Securities(4) 95,206 (10,922 ) 15,268 (275 ) 0 (22,332 ) 24 9,969 (1,486 ) 85,452 (6,627 ) Structured Securities(5) 185,358 (724 ) 84,810 (14,236 ) 0 (37,672 ) 0 51,979 (260,179 ) 9,336 0 Other assets: Fixed maturities, trading 0 0 0 0 0 0 0 0 0 0 0 Equity securities 9,758 (591 ) 0 (3,609 ) 0 0 147 0 0 5,705 (1,208 ) Other invested assets 147 0 0 0 0 0 (147 ) 0 0 0 0 Short-term investments 87 (20 ) 0 0 0 (43 ) (24 ) 0 0 0 (55 ) Cash equivalents 0 13 0 0 0 (13 ) 0 0 0 0 0 Other assets 0 0 0 0 0 0 0 0 0 0 0 Reinsurance recoverables 244,006 (28,757 ) 19,061 0 0 0 5,601 0 0 239,911 (19,962 ) Liabilities: Future policy benefits (8,151,902 ) 843,914 0 0 (1,024,486 ) 0 0 0 0 (8,332,474 ) 529,804 Policyholders' account balances(6) 0 6,051 0 0 (48,401 ) 0 0 0 0 (42,350 ) 6,051 Year Ended December 31, 2018 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, available-for-sale $ (6,693 ) $ 0 $ (5,194 ) $ 241 $ (6,627 ) $ 0 Other assets: Fixed maturities, trading 0 0 0 0 0 0 Equity securities 0 (591 ) 0 0 0 (1,208 ) Other invested assets 0 0 0 0 0 0 Short-term investments (20 ) 0 0 0 (55 ) 0 Cash equivalents 13 0 0 0 0 0 Other assets 0 0 0 0 0 0 Reinsurance recoverables (28,757 ) 0 0 0 (19,962 ) 0 Liabilities: Future policy benefits 843,914 0 0 0 529,804 0 Policyholders' account balances 6,051 0 0 0 6,051 0 The following tables summarize the portion of changes in fair values of Level 3 assets and liabilities included in earnings and OCI for the year ended December 31, 2017 , as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held as of December 31, 2017 . Year Ended December 31, 2017 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(3) Realized investment gains (losses), net(1) Asset administration fees and other income Included in other comprehensive income (losses) Net investment income Realized investment gains (losses), net Asset administration fees and other income (in thousands) Fixed maturities, available-for-sale $ (6,301 ) $ 0 $ (3,410 ) $ 8,057 $ (6,506 ) $ 0 Other assets: Fixed maturities, trading 0 0 0 0 0 0 Equity securities 0 689 351 0 0 338 Other invested assets (7 ) 0 0 0 (7 ) 0 Short-term investments 0 0 0 0 0 0 Cash equivalents 0 0 0 0 0 0 Other assets 0 0 0 0 0 0 Reinsurance recoverables (18,240 ) 0 0 0 (10,303 ) 0 Liabilities: Future policy benefits 552,047 0 0 0 307,529 0 Policyholders' account balances 0 0 0 0 0 0 (1) Realized investment gains (losses) on future policy benefits and reinsurance recoverables primarily represent the change in the fair value of the Company's living benefit guarantees on certain of its variable annuity contracts. (2) Other includes reclassifications of certain assets and liabilities between reporting categories. (3) Unrealized gains or losses related to assets still held at the end of the period do not include amortization or accretion of premiums and discounts. (4) Includes U.S. corporate public, U.S. corporate private, foreign corporate public and foreign corporate private securities. (5) Includes asset-backed, commercial mortgage-backed and residential mortgage-backed securities. (6) Issuances and settlements for Policyholders' account balances are presented net in the rollforward. |
Fair Value Disclosure Financial Instruments Not Carried at Fair Value | The table below presents the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value. The financial instruments presented below are reported at carrying value on the Statements of Financial Position. In some cases, as described below, the carrying amount equals or approximates fair value. December 31, 2019 Fair Value Carrying Amount(1) Level 1 Level 2 Level 3 Total Total (in thousands) Assets: Commercial mortgage and other loans $ 0 $ 0 $ 1,512,283 $ 1,512,283 $ 1,471,522 Policy loans 0 0 12,366 12,366 12,366 Short-term investments 75,004 0 0 75,004 75,004 Cash and cash equivalents 687,558 302,000 0 989,558 989,558 Accrued investment income 0 102,724 0 102,724 102,724 Reinsurance recoverables 0 0 56,171 56,171 55,796 Receivables from parent and affiliates 0 10,192 50,587 60,779 60,192 Other assets 0 1,893 63,106 64,999 64,999 Total assets $ 762,562 $ 416,809 $ 1,694,513 $ 2,873,884 $ 2,832,161 Liabilities: Policyholders’ account balances - investment contracts $ 0 $ 0 $ 1,445,486 $ 1,445,486 $ 1,438,742 Cash collateral for loaned securities 0 0 0 0 0 Short-term debt 0 245,617 0 245,617 242,094 Long-term debt 0 446,105 0 446,105 419,418 Reinsurance Payables 0 0 50,035 50,035 50,035 Payables to parent and affiliates 0 39,209 0 39,209 39,209 Other liabilities 0 205,988 0 205,988 205,988 Separate account liabilities - investment contracts 0 54 0 54 54 Total liabilities $ 0 $ 936,973 $ 1,495,521 $ 2,432,494 $ 2,395,540 December 31, 2018 Fair Value Carrying Amount(1) Level 1 Level 2 Level 3 Total Total (in thousands) Assets: Commercial mortgage and other loans $ 0 $ 0 $ 1,339,707 $ 1,339,707 $ 1,353,478 Policy loans 0 0 12,805 12,805 12,805 Short-term investments 7,750 0 0 7,750 7,750 Cash and cash equivalents 136,175 675,000 0 811,175 811,175 Accrued investment income 0 90,895 0 90,895 90,895 Reinsurance recoverables 0 0 55,236 55,236 55,236 Receivables from parent and affiliates 0 9,188 0 9,188 9,188 Other assets 0 3,735 0 3,735 3,735 Total assets $ 143,925 $ 778,818 $ 1,407,748 $ 2,330,491 $ 2,344,262 Liabilities: Policyholders’ account balances - investment contracts $ 0 $ 0 $ 560,548 $ 560,548 $ 565,903 Cash collateral for loaned securities 0 384 0 384 384 Short-term debt 0 139,843 0 139,843 140,569 Long-term debt 0 791,670 0 791,670 787,596 Reinsurance payables 0 0 55,236 55,236 55,236 Payables to parent and affiliates 0 30,846 0 30,846 30,846 Other liabilities 0 554,162 0 554,162 554,162 Separate account liabilities - investment contracts 0 71 0 71 71 Total liabilities $ 0 $ 1,516,976 $ 615,784 $ 2,132,760 $ 2,134,767 (1) Carrying values presented herein differ from those in the Company’s Statements of Financial Position because certain items within the respective financial statement captions are not considered financial instruments or out of scope under authoritative guidance relating to disclosures of the fair value of financial instruments. |
Deferred Policy Acquisition C_2
Deferred Policy Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Schedule of Deferred Acquisition Costs Table | The balances of and changes in DAC as of and for the years ended December 31, are as follows: 2019 2018 2017 (in thousands) Balance, beginning of year $ 4,447,505 $ 4,596,565 $ 4,344,361 Capitalization of commissions, sales and issue expenses 412,627 372,996 277,586 Amortization-Impact of assumption and experience unlocking and true-ups 245,276 (113,534 ) 288,974 Amortization-All other (518,129 ) (476,261 ) (275,028 ) Change in unrealized investment gains and losses (131,596 ) 67,739 (39,328 ) Balance, end of year $ 4,455,683 $ 4,447,505 $ 4,596,565 |
Value of Business Acquired (Tab
Value of Business Acquired (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Present Value of Future Insurance Profits [Abstract] | |
Schedule Of Present Value Of Future Insurance Profits | The balances of and changes in VOBA as of and for the years ended December 31, are as follows: 2019 2018 2017 (in thousands) Balance, beginning of year $ 33,222 $ 35,109 $ 30,287 Amortization-Impact of assumption and experience unlocking and true-ups 2,093 1,485 10,035 Amortization-All other (6,376 ) (7,348 ) (7,422 ) Interest 1,778 1,983 2,001 Change in unrealized investment gains and losses (692 ) 1,993 208 Balance, end of year $ 30,025 $ 33,222 $ 35,109 |
Expected Amortization Expense of Ending Value of Future Insurance Profits | The following table provides estimated future amortization, net of interest, for the periods indicated: 2020 2021 2022 2023 2024 (in thousands) Estimated future VOBA amortization $ 4,610 $ 3,976 $ 3,421 $ 2,926 $ 2,491 |
Policyholders' Liabilities (Tab
Policyholders' Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Liability for Future Policy Benefit, before Reinsurance [Abstract] | |
Schedule of Liability for Future Policy Benefits and Policyholders' Account Balances | Future policy benefits at December 31 for the years indicated are as follows: 2019 2018 (in thousands) Life insurance – domestic $ 71 $ 74 Individual and group annuities and supplementary contracts(1) 1,087,060 1,021,854 Other contract liabilities(1) 11,845,330 8,347,058 Total future policy benefits $ 12,932,461 $ 9,368,986 (1) Includes assumed reinsurance business. Policyholders’ account balances at December 31 for the years indicated are as follows: 2019 2018 (in thousands) Interest-sensitive life contracts $ 14,391 $ 15,049 Individual annuities(1) 5,716,052 4,729,973 Guaranteed interest accounts 449,916 608,574 Total policyholders’ account balances $ 6,180,359 $ 5,353,596 (1) Includes assumed reinsurance business from Pruco Life. |
Certain Long-Duration Contrac_2
Certain Long-Duration Contracts With Guarantees (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Long-Duration Contracts, Assumptions Supporting Guarantee Obligations [Abstract] | |
Schedule of Net Amount of Risk by Product and Guarantee | As of December 31, 2019 and 2018 , the Company had the following guarantees associated with these contracts, by product and guarantee type: December 31, 2019 December 31, 2018 In the Event of Death(1) At Annuitization/ Accumulation(1)(2) In the Event of Death(1) At Annuitization/ Accumulation (1)(2) Annuity Contracts (in thousands) Return of net deposits Account value $ 120,240,930 N/A $ 106,779,202 N/A Net amount at risk $ 229,080 N/A $ 843,419 N/A Average attained age of contractholders 68 years N/A 67 years N/A Minimum return or contract value Account value $ 23,563,604 $ 129,812,105 $ 22,184,537 $ 115,822,894 Net amount at risk $ 2,254,621 $ 3,989,437 $ 4,322,406 $ 7,252,486 Average attained age of contractholders 70 years 69 years 70 years 68 years Average period remaining until earliest expected annuitization N/A 0 years N/A 0 years (1) Amounts include assumed reinsurance business. (2) Includes income and withdrawal benefits. |
Schedule of Fair Value of Separate Accounts by Major Category of Investment | Account balances of variable annuity contracts with guarantees were invested in separate account investment options as follows: December 31, 2019(1) December 31, 2018(1) (in thousands) Equity funds $ 82,506,787 $ 69,686,791 Bond funds 53,763,563 51,855,361 Money market funds 2,877,135 2,542,219 Total $ 139,147,485 $ 124,084,371 (1) Amounts include assumed reinsurance business. |
Schedule of Minimum Guaranteed Benefit Liabilities | The table below summarizes the changes in general account liabilities for guarantees. The liabilities for GMDB and GMIB are included in “Future policy benefits” and the related changes in the liabilities are included in “Policyholders’ benefits.” GMAB, GMWB and GMIWB are accounted for as embedded derivatives and are recorded at fair value within “Future policy benefits.” Changes in the fair value of these derivatives, including changes in the Company’s own risk of non-performance, along with any fees attributed or payments made relating to the derivative are recorded in “Realized investment gains (losses), net.” See Note 5 for additional information regarding the methodology used in determining the fair value of these embedded derivatives. The Company maintains a portfolio of derivative investments that serve as a partial hedge of the risks associated with these products, for which the changes in fair value are also recorded in “Realized investment gains (losses), net.” This portfolio of derivative investments does not qualify for hedge accounting treatment under U.S. GAAP. GMDB GMAB/GMWB/ GMIWB GMIB Totals Variable Annuity (in thousands) Balance at December 31, 2016 $ 637,319 $ 7,707,333 $ 37,893 $ 8,382,545 Incurred guarantee benefits(1)(2) 29,605 444,569 (11,686 ) 462,488 Paid guarantee benefits(2) (57,053 ) 0 (3,798 ) (60,851 ) Change in unrealized investment gains and losses(2) 12,931 0 117 13,048 Balance at December 31, 2017 622,802 8,151,902 22,526 8,797,230 Incurred guarantee benefits(1)(2) 103,596 180,572 2,679 286,847 Paid guarantee benefits(2) (67,887 ) 0 (2,915 ) (70,802 ) Change in unrealized investment gains and losses(2) (20,108 ) 0 (230 ) (20,338 ) Balance at December 31, 2018 638,403 8,332,474 22,060 8,992,937 Incurred guarantee benefits(1)(2) 68,142 3,490,524 3,539 3,562,205 Paid guarantee benefits(2) (51,418 ) 0 (3,477 ) (54,895 ) Change in unrealized investment gains and losses(2) 26,377 0 274 26,651 Balance at December 31, 2019 $ 681,504 $ 11,822,998 $ 22,396 $ 12,526,898 (1) Incurred guarantee benefits include the portion of assessments established as additions to reserves as well as changes in estimates affecting the reserves. Also includes changes in the fair value of features considered to be derivatives. (2) Amounts include assumed reinsurance business. |
Deferred Sales Inducements | Changes in DSI, reported as “Interest credited to policyholders’ account balances”, are as follows: Sales Inducements (in thousands) Balance at December 31, 2016 $ 978,823 Capitalization 1,551 Amortization - Impact of assumption and experience unlocking and true-ups 145,141 Amortization - All other (94,014 ) Change in unrealized investment gains and losses (10,715 ) Balance at December 31, 2017 1,020,786 Capitalization 2,888 Amortization - Impact of assumption and experience unlocking and true-ups (5,713 ) Amortization - All other (149,236 ) Change in unrealized investment gains and losses 20,873 Balance at December 31, 2018 889,598 Capitalization 797 Amortization - Impact of assumption and experience unlocking and true-ups 100,222 Amortization - All other (146,620 ) Change in unrealized investment gains and losses (31,273 ) Balance at December 31, 2019 $ 812,724 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance Impact On Balance Sheet | Reinsurance amounts included in the Company's Statements of Financial Position as of December 31, were as follows: 2019 2018 (in thousands) Reinsurance recoverables $ 621,510 $ 572,102 Deferred policy acquisition costs 3,725,719 3,703,166 Deferred sales inducements 437,594 476,608 Value of business acquired (2,275 ) (2,431 ) Other assets 65,819 79,992 Policyholders’ account balances 3,253,474 3,098,537 Future policy benefits 8,328,777 5,680,939 Reinsurance payables(1) 235,318 232,937 Other liabilities 337,909 290,330 (1) Includes $0.1 million of unaffiliated activity as of both December 31, 2019 and 2018 . |
Reinsurance Table By Affiliate | The reinsurance recoverables by counterparty are broken out below: December 31, 2019 December 31, 2018 (in thousands) Prudential Insurance $ 387,355 $ 335,349 Pruco Life 233,933 236,716 Unaffiliated 222 37 Total reinsurance recoverables $ 621,510 $ 572,102 |
Reinsurance Impact On Income Statement | Reinsurance amounts, included in the Company’s Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, were as follows: 2019 2018 2017 (in thousands) Premiums: Direct $ 29,022 $ 37,895 $ 33,908 Assumed 31,570 31,989 32,890 Ceded (1,042 ) (2,619 ) (3,225 ) Net premiums 59,550 67,265 63,573 Policy charges and fee income: Direct 477,478 549,500 622,099 Assumed 1,638,023 1,661,484 1,632,132 Ceded(1) (34,455 ) (39,706 ) (44,652 ) Net policy charges and fee income 2,081,046 2,171,278 2,209,579 Asset administration fees and other income: Direct 141,884 96,743 129,847 Assumed 306,945 301,549 293,275 Ceded (8,346 ) (9,136 ) (9,747 ) Net asset administration fees and other income 440,483 389,156 413,375 Realized investment gains (losses), net: Direct (1,137,422 ) 81,120 (1,335,253 ) Assumed (1,584,764 ) 823,129 554,686 Ceded 40,866 (20,176 ) (24,833 ) Realized investment gains (losses), net (2,681,320 ) 884,073 (805,400 ) Policyholders' benefits (including change in reserves): Direct 58,308 81,045 52,477 Assumed 89,284 110,358 46,375 Ceded(2) (3,667 ) (4,315 ) 15,216 Net policyholders' benefits (including change in reserves) 143,925 187,088 114,068 Interest credited to policyholders’ account balances: Direct 82,444 127,018 9,834 Assumed 84,182 132,324 24,708 Ceded (5,417 ) (10,167 ) (4,262 ) Net interest credited to policyholders’ account balances 161,209 249,175 30,280 Reinsurance expense allowances and general and administrative expenses, net of capitalization and amortization 988,951 1,131,351 725,749 (1) Includes $(1) million , $(1) million and $(2) million of unaffiliated activity for the years ended December 31, 2019 , 2018 and 2017 , respectively. (2) Includes $(0.1) million , $(0.3) million and $(0.1) million of unaffiliated activity for the years ended December 31, 2019 , 2018 and 2017 , respectively. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The following schedule discloses significant components of income tax expense (benefit) for each year presented: Year Ended December 31, 2019 2018 2017 (in thousands) Current tax expense (benefit): U.S. federal $ 14,381 $ (422,999 ) $ 501,088 State and local 0 0 1,349 Total 14,381 (422,999 ) 502,437 Deferred tax expense (benefit): U.S. federal (305,482 ) 584,503 698,662 State and local 0 0 0 Total (305,482 ) 584,503 698,662 Income tax expense (benefit) (291,101 ) 161,504 1,201,099 Total income tax expense (benefit) reported in equity related to: Other comprehensive income (loss) 200,447 (52,510 ) 98,644 Additional paid-in capital 0 0 0 Total income tax expense (benefit) $ (90,654 ) $ 108,994 $ 1,299,743 |
Schedule of Income Before Income Tax, Domestic and Foreign | The differences between income taxes expected at the U.S. federal statutory income tax rate of 21% applicable for 2019 and 2018 and 35% applicable for 2017, and the reported income tax expense (benefit) are summarized as follows: Year Ended December 31, 2019 2018 2017 (in thousands) Expected federal income tax expense (benefit) $ (268,890 ) $ 387,286 $ 391,158 Non-taxable investment income (12,019 ) (18,954 ) (46,625 ) Tax credits (11,708 ) (13,694 ) (10,358 ) Changes in tax law 0 (193,306 ) 882,175 Other 1,516 172 (15,251 ) Reported income tax expense (benefit) $ (291,101 ) $ 161,504 $ 1,201,099 Effective tax rate 22.7 % 8.8 % 107.5 % |
Schedule of Deferred Tax Assets and Liabilities | As of December 31, 2019 2018 (in thousands) Deferred tax assets: Insurance reserves $ 1,716,039 $ 1,521,729 Investments 411,788 276,880 Net unrealized loss on securities 0 86,742 Other 2,002 638 Deferred tax assets 2,129,829 1,885,989 Deferred tax liabilities: VOBA and deferred policy acquisition cost 929,882 929,849 Deferred sales inducements 170,672 186,816 Net unrealized gain on securities 154,815 0 Deferred tax liabilities 1,255,369 1,116,665 Net deferred tax asset (liability) $ 874,460 $ 769,324 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | The balance of and changes in each component of AOCI as of and for the years ended December 31, are as follows: Accumulated Other Comprehensive Income (Loss) Foreign Currency Translation Adjustment Net Unrealized Investment Gains (Losses)(1) Total Accumulated Other Comprehensive Income (Loss) (in thousands) Balance, December 31, 2016 $ (78 ) $ (314,870 ) $ (314,948 ) Change in OCI before reclassifications 109 320,182 320,291 Amounts reclassified from AOCI 0 3,177 3,177 Income tax benefit (expense) (38 ) (98,606 ) (98,644 ) Balance, December 31, 2017 (7 ) (90,117 ) (90,124 ) Change in OCI before reclassifications (1,354 ) (311,658 ) (313,012 ) Amounts reclassified from AOCI 0 62,970 62,970 Income tax benefit (expense) 285 52,225 52,510 Cumulative effect of adoption of ASU 2016-01 0 (3 ) (3 ) Cumulative effect of adoption of ASU 2018-02 (2 ) (36,712 ) (36,714 ) Balance, December 31, 2018 (1,078 ) (323,295 ) (324,373 ) Change in OCI before reclassifications 182 956,373 956,555 Amounts reclassified from AOCI 0 (3,123 ) (3,123 ) Income tax benefit (expense) (38 ) (200,409 ) (200,447 ) Balance, December 31, 2019 $ (934 ) $ 429,546 $ 428,612 (1) Includes cash flow hedges of $0 million , $(4) million and $(26) million as of December 31, 2019 , 2018 , and 2017 , respectively. |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Reclassifications out of Accumulated Other Comprehensive Income (Loss) Year Ended December 31, 2019 Year Ended December 31, 2018 Year Ended December 31, 2017 (in thousands) Amounts reclassified from AOCI(1)(2): Net unrealized investment gains (losses): Cash flow hedges - Currency/Interest rate(3) $ 7,054 $ 20,761 $ (1,838 ) Net unrealized investment gains (losses) on available-for-sale securities (3,931 ) (83,731 ) (1,339 ) Total net unrealized investment gains (losses)(4) 3,123 (62,970 ) (3,177 ) Total reclassifications for the period $ 3,123 $ (62,970 ) $ (3,177 ) (1) All amounts are shown before tax. (2) Positive amounts indicate gains/benefits reclassified out of AOCI. Negative amounts indicate losses/costs reclassified out of AOCI. (3) See Note 4 for additional information on cash flow hedges. (4) See table below for additional information on unrealized investment gains (losses), including the impact on deferred policy acquisition and other costs and future policy benefits. |
Net Unrealized Investment Gains (Losses) AOCI Rollforward | The amounts for the periods indicated below, split between amounts related to fixed maturity securities on which an OTTI loss has been recognized, and all other net unrealized investment gains (losses), are as follows: Net Unrealized Investment Gains (Losses) on Fixed Maturity Securities on which an OTTI loss has been recognized Net Unrealized Gains (Losses) on Investments Deferred Policy Acquisition Costs and Other Costs(2) Future Policy Benefits and Other Liabilities(3) Deferred Income Tax (Liability) Benefit Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) (in thousands) Balance, December 31, 2016 $ (1,261 ) $ (2,133 ) $ (522 ) $ 1,387 $ (2,529 ) Net investment gains (losses) on investments arising during the period 11,328 0 0 (3,481 ) 7,847 Reclassification adjustment for (gains) losses included in net income 2,172 0 0 (667 ) 1,505 Reclassification adjustment for OTTI losses excluded from net income (1) 72 0 0 (22 ) 50 Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 1,125 0 (352 ) 773 Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 365 (128 ) 237 Balance, December 31, 2017 12,311 (1,008 ) (157 ) (3,263 ) 7,883 Net investment gains (losses) on investments arising during the period (15,199 ) 0 0 3,192 (12,007 ) Reclassification adjustment for (gains) losses included in net income (205 ) 0 0 43 (162 ) Reclassification adjustment for OTTI losses excluded from net income (1) (241 ) 0 0 51 (190 ) Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (111 ) 0 23 (88 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 89 (19 ) 70 Balance, December 31, 2018 (3,334 ) (1,119 ) (68 ) 27 (4,494 ) Net investment gains (losses) on investments arising during the period 17,795 0 0 (3,741 ) 14,054 Reclassification adjustment for (gains) losses included in net income (100 ) 0 0 21 (79 ) Reclassification adjustment for OTTI losses excluded from net income (1) (52 ) 0 0 11 (41 ) Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (80 ) 0 17 (63 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 (51 ) 11 (40 ) Balance, December 31, 2019 $ 14,309 $ (1,199 ) $ (119 ) $ (3,654 ) $ 9,337 (1) Represents "transfers in" related to the portion of OTTI losses recognized during the period that were not recognized in earnings for securities with no prior OTTI loss. (2) "Other costs" primarily includes reinsurance recoverables, DSI and VOBA. (3) "Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains. |
All Other Net Unrealized Investment Gains (Losses) in AOCI Rollforward | All Other Net Unrealized Investment Gains (Losses) in AOCI Net Unrealized Gains (Losses) on Investments (1) Deferred Policy Acquisition Costs and Other Costs(3) Future Policy Benefits and Other Liabilities(4) Deferred Income Tax (Liability) Benefit Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) (in thousands) Balance, December 31, 2016 $ (442,314 ) $ (31,251 ) $ (5,664 ) $ 166,888 $ (312,341 ) Net investment gains (losses) on investments arising during the period 376,012 0 0 (115,538 ) 260,474 Reclassification adjustment for (gains) losses included in net income (5,349 ) 0 0 1,644 (3,705 ) Reclassification adjustment for OTTI losses excluded from net income (2) (72 ) 0 0 22 (50 ) Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (50,961 ) 0 15,949 (35,012 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 (11,333 ) 3,967 (7,366 ) Balance, December 31, 2017 (71,723 ) (82,212 ) (16,997 ) 72,932 (98,000 ) Net investment gains (losses) on investments arising during the period (405,264 ) 0 0 85,105 (320,159 ) Reclassification adjustment for (gains) losses included in net income 63,175 0 0 (13,267 ) 49,908 Reclassification adjustment for OTTI losses excluded from net income (2) 241 0 0 (51 ) 190 Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 90,717 0 (19,049 ) 71,668 Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 18,110 (3,803 ) 14,307 Cumulative effect of adoption of ASU 2016-01 (4 ) 0 0 1 (3 ) Cumulative effect of adoption of ASU 2018-02 0 0 0 (36,712 ) (36,712 ) Balance, December 31, 2018 (413,575 ) 8,505 1,113 85,156 (318,801 ) Net investment gains (losses) on investments arising during the period 1,139,167 0 0 (239,496 ) 899,671 Reclassification adjustment for (gains) losses included in net income (3,023 ) 0 0 636 (2,387 ) Reclassification adjustment for OTTI losses excluded from net income (2) 52 0 0 (11 ) 41 Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs 0 (163,481 ) 0 34,369 (129,112 ) Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities 0 0 (36,977 ) 7,774 (29,203 ) Balance, December 31, 2019 $ 722,621 $ (154,976 ) $ (35,864 ) $ (111,572 ) $ 420,209 (1) Includes cash flow hedges. See Note 4 for information on cash flow hedges. (2) Represents "transfers out" related to the portion of OTTI losses recognized during the period that were not recognized in earnings for securities with no prior OTTI loss. (3) "Other costs" primarily includes reinsurance recoverables, DSI and VOBA. (4) "Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains. |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Affiliated Notes Receivable | Affiliated notes receivable included in "Receivables from parent and affiliates" at December 31, were as follows: Maturity Dates Interest Rates 2019 2018 (in thousands) U.S. dollar floating rate notes 2028 3.83% - 4.25 % $ 0 $ 34,008 U.S. dollar fixed rate notes 2026 - 2027 2.62% - 14.85 % 52,573 3,184 Total long-term notes receivable - affiliated(1) $ 52,573 $ 37,192 (1) All long-term notes receivable may be called for prepayment prior to the respective maturity dates under specified circumstances. |
Affiliated Asset Transfers | The table below shows affiliated asset trades for the years ended December 31, 2019 and 2018 : Affiliate Date Transaction Security Type Fair Value Book Value APIC, Net of Tax Increase/ (Decrease) Realized Investment Gain/ (Loss), Net of Tax (in thousands) Prudential Insurance February 2018 Purchase Fixed Maturities $ 136,963 $ 136,963 $ 0 $ 0 Pruco Life Insurance Company of Arizona April 2018 Sale Fixed Maturities $ 64,313 $ 64,514 $ 0 $ (159 ) Prudential Insurance April 2018 Sale Fixed Maturities $ 57,747 $ 43,434 $ 0 $ 11,308 Prudential Insurance May 2018 Sale Fixed Maturity & Commercial Mortgages $ 162,111 $ 159,237 $ 0 $ 2,271 Passaic Fund LLC June 2018 Transfer Out Other Invested Assets - Privates $ 15,281 $ 15,281 $ 0 $ 0 Prudential Insurance July 2018 Sale Fixed Maturities $ 11,160 $ 9,277 $ 0 $ 1,488 Prudential Insurance August 2018 Sale Commercial Mortgages $ 13,414 $ 13,165 $ 0 $ 196 Prudential Insurance December 2018 Purchase Fixed Maturities $ 33,256 $ 33,166 $ 0 $ (71 ) Prudential Agricultural Investors LP December 2018 Transfer Out Other Invested Assets - Privates $ 7,324 $ 7,324 $ 0 $ 0 Prudential Insurance January 2019 Sale Fixed Maturities $ 20,504 $ 20,781 $ 0 $ (277 ) Prudential Insurance February 2019 Sale Commercial Mortgages $ 97,953 $ 98,506 $ 0 $ (554 ) Prudential Insurance March 2019 Purchase Fixed Maturities $ 141,476 $ 141,476 $ 0 $ 7,776 Prudential Insurance April 2019 Purchase Equity Securities $ 4,300 $ 4,300 $ 0 $ 0 Prudential Retirement Insurance and Annuity Company April 2019 Purchase Equity Securities $ 1,258 $ 1,258 $ 0 $ 0 Pruco Life Insurance Company April 2019 Purchase Equity Securities $ 14,525 $ 14,525 $ 0 $ 0 Prudential Insurance June 2019 Transfer out Fixed Maturities $ 23,066 $ 23,002 $ 0 $ 64 Prudential Insurance June 2019 Transfer In Fixed Maturities $ 19,919 $ 19,919 $ 0 $ 0 Prudential Insurance August 2019 Sale Fixed Maturities $ 66,346 $ 64,735 $ 0 $ 1,611 Prudential Insurance August 2019 Sale Commercial Mortgages $ 106,307 $ 104,733 $ 0 $ 1,574 Prudential Insurance November 2019 Sale Other Invested Assets $ 2,289 $ 2,362 $ 0 $ (73 ) Prudential Insurance November 2019 Sale Fixed Maturity $ 6,517 $ 8,550 $ 0 $ (2,033 ) Prudential Insurance December 2019 Purchase Fixed Maturity $ 5,271 $ 5,271 $ 0 $ 0 Prudential Insurance December 2019 Purchase Fixed Maturity $ 85,261 $ 85,261 $ 0 $ 0 Prudential Insurance December 2019 Sale Fixed Maturity $ 21,425 $ 20,628 $ 0 $ 797 |
Debt Agreements | The following table provides the breakout of the Company's short and long-term debt to affiliates: Affiliate Date Issued Amount of Notes - December 31, 2019 Amount of Notes - December 31, 2018 Interest Rate Date of Maturity (in thousands) Prudential Insurance 4/20/2016 $ 0 $ 46,835 2.80 % 6/20/2019 Prudential Insurance 4/20/2016 0 18,734 2.80 % 6/20/2019 Prudential Insurance 4/20/2016 37,468 37,468 3.64 % 12/6/2020 Prudential Insurance 4/20/2016 93,671 93,671 3.64 % 12/15/2020 Prudential Insurance 4/20/2016 103,039 103,039 3.64 % 12/15/2020 Prudential Insurance 4/20/2016 93,671 93,671 3.47 % 6/20/2021 Prudential Insurance 4/20/2016 93,671 93,671 4.39 % 12/15/2023 Prudential Insurance 4/20/2016 28,102 28,102 4.39 % 12/15/2023 Prudential Insurance 4/20/2016 37,468 37,468 3.95 % 6/20/2024 Prudential Insurance 4/20/2016 93,671 93,671 3.95 % 6/20/2024 Prudential Insurance 4/20/2016 46,835 46,835 3.95 % 6/20/2024 Prudential Insurance 6/28/2016 0 30,000 2.08 % 6/28/2019 Prudential Insurance 6/28/2016 0 50,000 3.49 % 6/28/2026 Prudential Insurance 6/28/2016 0 25,000 3.49 % 6/28/2026 Prudential Insurance 6/28/2016 26,000 26,000 2.59 % 6/28/2021 Prudential Insurance 6/28/2016 0 25,000 2.08 % 6/28/2019 Prudential Insurance 6/28/2016 0 20,000 2.08 % 6/28/2019 Prudential Insurance 6/28/2016 0 25,000 3.49 % 6/28/2026 Prudential Retirement Insurance & Annuity 6/28/2016 0 34,000 3.09 % 6/28/2023 Prudential Funding LLC 12/16/2019 1,298 0 2.02 % 1/16/2020 Prudential Funding LLC 12/17/2019 1,478 0 2.02 % 1/15/2020 Prudential Funding LLC 12/17/2019 502 0 2.02 % 1/16/2020 Prudential Funding LLC 12/18/2019 4,638 0 2.02 % 1/16/2020 Total Loans Payable to Affiliates $ 661,512 $ 928,165 |
Quarterly Results of Operatio_2
Quarterly Results of Operations (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Data [Abstract] | |
Schedule of Quarterly Financial Information | The unaudited quarterly results of operations for the years ended December 31, 2019 and 2018 are summarized in the table below: Three Months Ended March 31 June 30 September 30 December 31 (in thousands) 2019 Total revenues $ (582,563 ) $ (103,779 ) $ 272,685 $ 864,964 Total benefits and expenses 296,641 404,277 558,773 472,044 Income (loss) from operations before income taxes (879,204 ) (508,056 ) (286,088 ) 392,920 Net income (loss) $ (900,024 ) $ (168,770 ) $ (227,512 ) $ 306,979 2018 Total revenues $ 1,331,262 $ 769,260 $ 826,028 $ 988,030 Total benefits and expenses 539,327 517,619 561,865 451,549 Income (loss) from operations before income taxes 791,935 251,641 264,163 536,481 Net income (loss) $ 635,679 $ 202,546 $ 412,236 $ 432,255 |
Significant Accounting Polici_3
Significant Accounting Policies and Pronouncements (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2019 | [1] | Jan. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | |||||||
Commercial mortgage and other loans, Loan-to- value ratios (greater than) | 100.00% | ||||||
Commercial mortgage and other loans, Loan-to-value ratios (less than) | 100.00% | ||||||
Commercial mortgage and other loans, Debt service coverage ratios (less than) | 1 | ||||||
Commercial mortgage and other loans, Debt service coverage ratios (greater than) | 1 | ||||||
Uncertain tax positions measurement percentage (greater than) | 50.00% | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Retained earnings / (accumulated deficit) | $ (46,693) | $ 943,005 | |||||
Accumulated other comprehensive income (loss) | $ 428,612 | (324,373) | |||||
Cumulative effect of adoption | $ 42 | ||||||
Securities Loaned Transactions Collateral Fair Value of Domestic Securities | 102.00% | ||||||
Securities Loaned Transactions Collateral Fair Value of Foreign Securities | 105.00% | ||||||
Minimum | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Repurchase and Resale Agreements, Collateral, Percentage | 95.00% | ||||||
Insurance revenue and expense recognition, Assumed interest rate | 0.00% | 0.00% | |||||
Maximum | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Insurance revenue and expense recognition, Assumed interest rate | 8.30% | 8.30% | |||||
Accumulated Other Comprehensive Income (loss) | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Accumulated other comprehensive income (loss) | $ 428,612 | $ (324,373) | $ (90,124) | $ (314,948) | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 428,612 | (324,373) | (90,124) | (314,948) | |||
Cumulative effect of adoption | $ 0 | $ (36,700) | |||||
Accumulated Other Comprehensive Income (loss) | ASU 2016-01 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Cumulative effect of adoption | (3) | (3) | |||||
Retained earnings | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ (46,693) | $ 943,005 | $ (776,762) | $ (693,258) | |||
Cumulative effect of adoption | $ (371) | 36,700 | |||||
Retained earnings | ASU 2016-01 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Cumulative effect of adoption | 337 | ||||||
Restatement Adjustment | ASU 2016-01 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Retained earnings / (accumulated deficit) | 337 | ||||||
Accumulated other comprehensive income (loss) | (3) | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 334 | ||||||
[1] | Includes the impact from the adoption of ASUs 2017-08 and 2017-12. See Note 2. |
Investments (Fixed Maturities S
Investments (Fixed Maturities Securities Excluding Investments Classified as Trading) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 12,465,746 | $ 10,186,465 |
Fair Value | 13,202,365 | 9,771,673 |
Fixed maturities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 12,465,746 | 10,186,465 |
Gross Unrealized Gains | 792,306 | 86,799 |
Gross Unrealized Losses | 55,687 | 501,591 |
Fair Value | 13,202,365 | 9,771,673 |
Fixed maturities | U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 6,667,347 | 5,240,519 |
Gross Unrealized Gains | 491,943 | 20,065 |
Gross Unrealized Losses | 39,466 | 376,493 |
Fair Value | 7,119,824 | 4,884,091 |
Fixed maturities | Obligations of U.S. states and their political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 252,304 | 133,670 |
Gross Unrealized Gains | 7,814 | 621 |
Gross Unrealized Losses | 436 | 3,127 |
Fair Value | 259,682 | 131,164 |
Fixed maturities | Foreign government bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 203,386 | 199,044 |
Gross Unrealized Gains | 19,518 | 4,748 |
Gross Unrealized Losses | 20 | 4,156 |
Fair Value | 222,884 | 199,636 |
Fixed maturities | U.S. public corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,615,060 | 1,498,130 |
Gross Unrealized Gains | 126,947 | 26,425 |
Gross Unrealized Losses | 1,331 | 50,582 |
Fair Value | 1,740,676 | 1,473,973 |
Fixed maturities | U.S. private corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,159,962 | 1,070,400 |
Gross Unrealized Gains | 50,720 | 15,430 |
Gross Unrealized Losses | 3,343 | 22,877 |
Fair Value | 1,207,339 | 1,062,953 |
Fixed maturities | Foreign public corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 321,111 | 296,029 |
Gross Unrealized Gains | 16,989 | 1,888 |
Gross Unrealized Losses | 113 | 6,831 |
Fair Value | 337,987 | 291,086 |
Fixed maturities | Foreign private corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,171,411 | 829,588 |
Gross Unrealized Gains | 50,069 | 10,415 |
Gross Unrealized Losses | 7,995 | 27,771 |
Fair Value | 1,213,485 | 812,232 |
Fixed maturities | Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 443,767 | 505,862 |
Gross Unrealized Gains | 3,405 | 3,147 |
Gross Unrealized Losses | 2,734 | 3,765 |
Fair Value | 444,438 | 505,244 |
Fixed maturities | Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 557,584 | 364,601 |
Gross Unrealized Gains | 20,941 | 2,770 |
Gross Unrealized Losses | 236 | 5,491 |
Fair Value | 578,289 | 361,880 |
Fixed maturities | Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 73,814 | 48,622 |
Gross Unrealized Gains | 3,960 | 1,290 |
Gross Unrealized Losses | 13 | 498 |
Fair Value | 77,761 | 49,414 |
OTTI | Fixed maturities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | (20) | (16) |
Net Unrealized Gains (Losses) | 14,300 | 3,300 |
OTTI | Fixed maturities | U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | Obligations of U.S. states and their political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | Foreign government bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | U.S. public corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | U.S. private corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | Foreign public corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | Foreign private corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | (20) | (16) |
OTTI | Fixed maturities | Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | 0 | 0 |
OTTI | Fixed maturities | Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
OTTI in AOCI | $ 0 | $ 0 |
Investments (Fair Value and Los
Investments (Fair Value and Losses by Investment Category and Length of Time in a Loss Position) (Details) - Fixed maturities - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | $ 1,928,598 | $ 2,264,523 |
Less than Twelve Months, Gross Unrealized Losses | 45,616 | 69,336 |
Twelve Months or More, Fair Value | 408,904 | 4,678,656 |
Twelve Months or More, Gross Unrealized Losses | 10,071 | 432,255 |
Total, Fair Value | 2,337,502 | 6,943,179 |
Total, Gross Unrealized Losses | 55,687 | 501,591 |
U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 1,336,007 | 367,796 |
Less than Twelve Months, Gross Unrealized Losses | 39,456 | 4,844 |
Twelve Months or More, Fair Value | 5,855 | 3,304,663 |
Twelve Months or More, Gross Unrealized Losses | 10 | 371,649 |
Total, Fair Value | 1,341,862 | 3,672,459 |
Total, Gross Unrealized Losses | 39,466 | 376,493 |
Obligations of U.S. states and their political subdivisions | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 97,752 | 25,764 |
Less than Twelve Months, Gross Unrealized Losses | 436 | 322 |
Twelve Months or More, Fair Value | 0 | 83,950 |
Twelve Months or More, Gross Unrealized Losses | 0 | 2,805 |
Total, Fair Value | 97,752 | 109,714 |
Total, Gross Unrealized Losses | 436 | 3,127 |
Foreign government bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 804 | 98,437 |
Less than Twelve Months, Gross Unrealized Losses | 13 | 2,346 |
Twelve Months or More, Fair Value | 132 | 58,975 |
Twelve Months or More, Gross Unrealized Losses | 7 | 1,810 |
Total, Fair Value | 936 | 157,412 |
Total, Gross Unrealized Losses | 20 | 4,156 |
U.S. public corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 93,147 | 627,589 |
Less than Twelve Months, Gross Unrealized Losses | 870 | 28,474 |
Twelve Months or More, Fair Value | 15,491 | 386,599 |
Twelve Months or More, Gross Unrealized Losses | 461 | 22,108 |
Total, Fair Value | 108,638 | 1,014,188 |
Total, Gross Unrealized Losses | 1,331 | 50,582 |
U.S. private corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 82,709 | 269,545 |
Less than Twelve Months, Gross Unrealized Losses | 2,111 | 7,755 |
Twelve Months or More, Fair Value | 59,797 | 422,498 |
Twelve Months or More, Gross Unrealized Losses | 1,232 | 15,122 |
Total, Fair Value | 142,506 | 692,043 |
Total, Gross Unrealized Losses | 3,343 | 22,877 |
Foreign public corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 50,150 | 97,367 |
Less than Twelve Months, Gross Unrealized Losses | 113 | 2,521 |
Twelve Months or More, Fair Value | 0 | 107,286 |
Twelve Months or More, Gross Unrealized Losses | 0 | 4,310 |
Total, Fair Value | 50,150 | 204,653 |
Total, Gross Unrealized Losses | 113 | 6,831 |
Foreign private corporate securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 97,414 | 373,891 |
Less than Twelve Months, Gross Unrealized Losses | 1,652 | 19,217 |
Twelve Months or More, Fair Value | 91,863 | 116,743 |
Twelve Months or More, Gross Unrealized Losses | 6,343 | 8,554 |
Total, Fair Value | 189,277 | 490,634 |
Total, Gross Unrealized Losses | 7,995 | 27,771 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 103,911 | 358,668 |
Less than Twelve Months, Gross Unrealized Losses | 717 | 3,501 |
Twelve Months or More, Fair Value | 235,759 | 24,529 |
Twelve Months or More, Gross Unrealized Losses | 2,017 | 264 |
Total, Fair Value | 339,670 | 383,197 |
Total, Gross Unrealized Losses | 2,734 | 3,765 |
Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 66,071 | 45,432 |
Less than Twelve Months, Gross Unrealized Losses | 236 | 355 |
Twelve Months or More, Fair Value | 0 | 159,638 |
Twelve Months or More, Gross Unrealized Losses | 0 | 5,136 |
Total, Fair Value | 66,071 | 205,070 |
Total, Gross Unrealized Losses | 236 | 5,491 |
Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than Twelve Months, Fair Value | 633 | 34 |
Less than Twelve Months, Gross Unrealized Losses | 12 | 1 |
Twelve Months or More, Fair Value | 7 | 13,775 |
Twelve Months or More, Gross Unrealized Losses | 1 | 497 |
Total, Fair Value | 640 | 13,809 |
Total, Gross Unrealized Losses | $ 13 | $ 498 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investment [Line Items] | |||
Equity Method Investments | $ 0 | $ 0 | |
Fair Value of Securities Received as Collateral that Can be Resold or Repledged | $ 302,000 | $ 675,000 | |
Commercial mortgage loans, Percentage | 100.00% | 100.00% | |
Commercial mortgage and others loans, Acquired | $ 0 | $ 0 | |
Commercial mortgage and other loans, Sold | 206,000 | 96,000 | |
Securities Sold under Agreements to Repurchase | 0 | 0 | |
Fixed maturities, available-for-sale: | 13,202,365 | 9,771,673 | |
Fixed maturities | |||
Investment [Line Items] | |||
Gross Unrealized Gains | 792,306 | 86,799 | |
Gross Unrealized losses | 55,687 | 501,591 | |
Gross unrealized losses of twelve months or more | 10,071 | 432,255 | |
Fixed maturities, available-for-sale: | 13,202,365 | 9,771,673 | |
Assets Deposited With Governmental Authorities | 10,700 | 8,400 | |
NAIC high or highest quality rating | Fixed maturities | |||
Investment [Line Items] | |||
Gross Unrealized losses | 52,500 | 485,700 | |
NAIC other than high or highest quality rating | Fixed maturities | |||
Investment [Line Items] | |||
Gross Unrealized losses | 3,200 | 15,900 | |
Other Income (Loss) | Equity securities | |||
Investment [Line Items] | |||
Unrealized Gain (Loss) on Investments | 2,000 | (1,900) | |
Other Comprehensive Income (Loss) | Equity securities | |||
Investment [Line Items] | |||
Unrealized Gain (Loss) on Investments | $ 400 | ||
Fixed maturities | |||
Investment [Line Items] | |||
Gross unrealized losses of twelve months or more | 10,100 | $ 432,300 | |
Carrying value of non-income producing assets | |||
Investment [Line Items] | |||
Fixed maturities, available-for-sale: | $ 4,100 | ||
California | |||
Investment [Line Items] | |||
Commercial mortgage loans, Percentage | 27.00% | ||
Texas | |||
Investment [Line Items] | |||
Commercial mortgage loans, Percentage | 13.00% | ||
New York | |||
Investment [Line Items] | |||
Commercial mortgage loans, Percentage | 7.00% | ||
Europe | |||
Investment [Line Items] | |||
Commercial mortgage loans, Percentage | 16.00% | ||
Australia | |||
Investment [Line Items] | |||
Commercial mortgage loans, Percentage | 4.00% |
Investments (Amortized Cost and
Investments (Amortized Cost and Fair Value of Fixed Maturities by Contractual Maturities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Amortized Cost | ||
Due in one year or less | $ 90,826 | |
Due after one year through five years | 1,116,306 | |
Due after five years through ten years | 1,762,440 | |
Due after ten years | 8,421,009 | |
Amortized Cost | 12,465,746 | $ 10,186,465 |
Fair Value | ||
Due in one year or less | 91,258 | |
Due after one year through five years | 1,149,228 | |
Due after five years through ten years | 1,862,864 | |
Due after ten years | 8,998,527 | |
Fair Value | 13,202,365 | 9,771,673 |
Fixed maturities | ||
Amortized Cost | ||
Amortized Cost | 12,465,746 | 10,186,465 |
Fair Value | ||
Fair Value | 13,202,365 | 9,771,673 |
Fixed maturities | Asset-backed securities | ||
Amortized Cost | ||
Amortized Cost | 443,767 | 505,862 |
Fair Value | ||
Fair Value | 444,438 | 505,244 |
Fixed maturities | Commercial mortgage-backed securities | ||
Amortized Cost | ||
Amortized Cost | 557,584 | 364,601 |
Fair Value | ||
Fair Value | 578,289 | 361,880 |
Fixed maturities | Residential mortgage-backed securities | ||
Amortized Cost | ||
Amortized Cost | 73,814 | 48,622 |
Fair Value | ||
Fair Value | $ 77,761 | $ 49,414 |
Investments (Fixed Maturities_2
Investments (Fixed Maturities Securities Proceeds) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Securities, Available-for-sale [Line Items] | |||
Proceeds from maturities/prepayments | $ 852,596 | $ 2,534,470 | $ 1,145,369 |
Fixed maturities | Available-for-sale | |||
Debt Securities, Available-for-sale [Line Items] | |||
Proceeds from sales | 384,592 | 2,126,886 | 517,743 |
Proceeds from maturities/prepayments | 468,004 | 404,679 | 630,140 |
Gross investment gains from sales and maturities | 3,259 | 21,129 | 8,992 |
Gross investment losses from sales and maturities | (3,364) | (98,047) | (3,047) |
OTTI recognized in earnings | (3,826) | (6,813) | (9,122) |
Non-cash related proceeds | $ 0 | $ (2,900) | $ 2,500 |
Investments (Credit Losses Reco
Investments (Credit Losses Recognized in Earnings on Fixed Maturity Securities Held by the Company) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Investments [Abstract] | ||
Balance in OCI, beginning of period | $ (209) | $ 792 |
New credit loss impairments | 1,343 | 0 |
Increases due to the passage of time on previously recorded credit losses | 10 | 3 |
Reductions for securities which matured, paid down, prepaid or were sold during the period | 223 | (40) |
Reductions for securities impaired to fair value during the period | (1,351) | (963) |
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected | (2) | (1) |
Balance in OCI, end of period | $ 14 | $ (209) |
Investments (Commercial Mortgag
Investments (Commercial Mortgage and Other Loans) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 1,474,185 | $ 1,356,374 |
Commercial mortgage loans, Percentage | 100.00% | 100.00% |
Allowance for Credit Losses | $ (2,663) | $ (2,896) |
Commercial mortgage and other loans | 1,471,522 | 1,353,478 |
Apartments and multi-family | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 272,150 | $ 304,644 |
Commercial mortgage loans, Percentage | 18.50% | 22.40% |
Hospitality | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 16,819 | $ 3,633 |
Commercial mortgage loans, Percentage | 1.10% | 0.30% |
Industrial | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 464,528 | $ 355,758 |
Commercial mortgage loans, Percentage | 31.50% | 26.20% |
Office | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 372,823 | $ 305,537 |
Commercial mortgage loans, Percentage | 25.30% | 22.50% |
Other | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 156,768 | $ 137,781 |
Commercial mortgage loans, Percentage | 10.60% | 10.20% |
Retail | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 131,051 | $ 194,646 |
Commercial mortgage loans, Percentage | 8.90% | 14.40% |
Commercial Mortgage Loans | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 1,414,139 | $ 1,301,999 |
Commercial mortgage loans, Percentage | 95.90% | 96.00% |
Agricultural property loans | ||
Commercial Mortgage and Other Loans [Line Items] | ||
Commercial mortgage and agricultural property loans by property type | $ 60,046 | $ 54,375 |
Commercial mortgage loans, Percentage | 4.10% | 4.00% |
Investments (Allowance for Cred
Investments (Allowance for Credit Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Allowance for Loan and Lease Losses [Roll Forward] | |||
Balance, beginning of year | $ 2,896 | $ 2,650 | $ 2,289 |
Addition to (release of) allowance for credit losses | (233) | 246 | 361 |
Charge-offs, net of recoveries | 0 | 0 | 0 |
Total ending balance | 2,663 | 2,896 | 2,650 |
Commercial Mortgage Loans | |||
Allowance for Loan and Lease Losses [Roll Forward] | |||
Balance, beginning of year | 2,861 | 2,616 | 2,267 |
Addition to (release of) allowance for credit losses | (239) | 245 | 349 |
Charge-offs, net of recoveries | 0 | 0 | 0 |
Total ending balance | 2,622 | 2,861 | 2,616 |
Agricultural Property Loans | |||
Allowance for Loan and Lease Losses [Roll Forward] | |||
Balance, beginning of year | 35 | 34 | 22 |
Addition to (release of) allowance for credit losses | 6 | 1 | 12 |
Charge-offs, net of recoveries | 0 | 0 | 0 |
Total ending balance | $ 41 | $ 35 | $ 34 |
Investments (Allowance for Cr_2
Investments (Allowance for Credit Losses and Recorded Investment in Commercial Mortgage and Other Loans) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Allowance for credit losses: | ||||
Individually evaluated for impairment | $ 0 | $ 0 | ||
Collectively evaluated for impairment | 2,663 | 2,896 | ||
Total ending balance | 2,663 | 2,896 | $ 2,650 | $ 2,289 |
Recorded Investment: | ||||
Individually evaluated for impairment | 0 | 3,439 | ||
Collectively evaluated for impairment | 1,474,185 | 1,352,935 | ||
Total ending balance | 1,474,185 | 1,356,374 | ||
Receivables Acquired with Deteriorated Credit Quality | ||||
Recorded Investment: | ||||
Financing Receivable Total | 0 | 0 | ||
Commercial Mortgage Loans | ||||
Allowance for credit losses: | ||||
Individually evaluated for impairment | 0 | 0 | ||
Collectively evaluated for impairment | 2,622 | 2,861 | ||
Total ending balance | 2,622 | 2,861 | 2,616 | 2,267 |
Recorded Investment: | ||||
Individually evaluated for impairment | 0 | 0 | ||
Collectively evaluated for impairment | 1,414,139 | 1,301,999 | ||
Total ending balance | 1,414,139 | 1,301,999 | ||
Agricultural Property Loans | ||||
Allowance for credit losses: | ||||
Individually evaluated for impairment | 0 | 0 | ||
Collectively evaluated for impairment | 41 | 35 | ||
Total ending balance | 41 | 35 | $ 34 | $ 22 |
Recorded Investment: | ||||
Individually evaluated for impairment | 0 | 3,439 | ||
Collectively evaluated for impairment | 60,046 | 50,936 | ||
Total ending balance | $ 60,046 | $ 54,375 |
Investments (Credit Quality Ind
Investments (Credit Quality Indicators) (Details) - Commercial and agricultural mortgage loans - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | $ 1,474,185 | $ 1,356,374 |
0%-59.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 725,904 | 724,501 |
60% to 69.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 513,571 | 465,568 |
70%-79.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 233,713 | 163,285 |
80% or greater | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 997 | 3,020 |
≥ 1.2X | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 1,418,305 | 1,309,699 |
≥ 1.2X | 0%-59.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 715,654 | 709,342 |
≥ 1.2X | 60% to 69.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 499,493 | 442,308 |
≥ 1.2X | 70%-79.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 203,158 | 156,049 |
≥ 1.2X | 80% or greater | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 0 | 2,000 |
1.0X to 1.2X | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 52,271 | 46,330 |
1.0X to 1.2X | 0%-59.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 6,641 | 14,814 |
1.0X to 1.2X | 60% to 69.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 14,078 | 23,260 |
1.0X to 1.2X | 70%-79.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 30,555 | 7,236 |
1.0X to 1.2X | 80% or greater | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 997 | 1,020 |
Less than 1.0X | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 3,609 | 345 |
Less than 1.0X | 0%-59.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 3,609 | 345 |
Less than 1.0X | 60% to 69.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 0 | 0 |
Less than 1.0X | 70%-79.99% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | 0 | 0 |
Less than 1.0X | 80% or greater | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recording investment gross of allowance for credit losses | $ 0 | $ 0 |
Investments Investments (Analys
Investments Investments (Analysis of Past Due Commercial Mortgage, Agricultural and Other Loans) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Financing Receivable, Past Due [Line Items] | ||
Current | $ 1,474,185 | $ 1,356,374 |
Total Loans | 1,474,185 | 1,356,374 |
Non-Accrual Status | 0 | 0 |
30 to 59 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
60 to 89 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
90 Days or More Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial Mortgage Loans | ||
Financing Receivable, Past Due [Line Items] | ||
Current | 1,414,139 | 1,301,999 |
Total Loans | 1,414,139 | 1,301,999 |
Non-Accrual Status | 0 | 0 |
Commercial Mortgage Loans | 30 to 59 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial Mortgage Loans | 60 to 89 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Commercial Mortgage Loans | 90 Days or More Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Agricultural Property Loans | ||
Financing Receivable, Past Due [Line Items] | ||
Current | 60,046 | 54,375 |
Total Loans | 60,046 | 54,375 |
Non-Accrual Status | 0 | 0 |
Agricultural Property Loans | 30 to 59 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Agricultural Property Loans | 60 to 89 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Agricultural Property Loans | 90 Days or More Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Past Due | 0 | 0 |
Loans | 90 Days or More Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Accruing Interest | $ 0 | $ 0 |
Investments (Other Invested Ass
Investments (Other Invested Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Other Invested Assets [Line Items] | ||
Other invested assets | $ 474,013 | $ 348,541 |
LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 474,011 | 305,563 |
Derivative Instruments | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 2 | 42,978 |
Equity Method | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 463,521 | 297,596 |
Equity Method | Private equity | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 23,414 | 23,844 |
Equity Method | Hedge funds | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 273,615 | 179,014 |
Equity Method | Real estate-related | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 166,492 | 94,738 |
Fair Value | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 10,490 | 7,967 |
Fair Value | Private equity | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 4,115 | 4,142 |
Fair Value | Hedge funds | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | 194 | 263 |
Fair Value | Real estate-related | LPs/LLCs | ||
Other Invested Assets [Line Items] | ||
Other invested assets | $ 6,181 | $ 3,562 |
Investments (Net Investment Inc
Investments (Net Investment Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | $ 571,577 | $ 417,743 | $ 438,873 |
Less: investment expenses | (20,029) | (14,935) | (16,064) |
Net investment income | 551,548 | 402,808 | 422,809 |
Equity securities | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | 568 | 678 | 567 |
Commercial mortgage and other loans | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | 51,628 | 51,040 | 48,598 |
Policy loans | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | 630 | 737 | 1,069 |
Short-term investments and cash equivalents | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | 85,084 | 28,645 | 31,505 |
Other invested assets | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | 34,422 | 13,733 | 20,626 |
Available-for-sale | Fixed maturities | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | 389,165 | 317,726 | 332,148 |
Trading | Fixed maturities | |||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||
Gross investment income | $ 10,080 | $ 5,184 | $ 4,360 |
Investments (Realized Investmen
Investments (Realized Investment Gains Losses, Net) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | $ (2,681,320) | $ 884,073 | $ (805,400) |
Fixed maturities | |||
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | (3,931) | (83,731) | (3,177) |
Commercial mortgage and other loans | |||
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | (753) | 128 | (840) |
LPs/LLCs | |||
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | 0 | 0 | (39) |
Derivatives | |||
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | (2,677,559) | 967,503 | (801,429) |
Other invested assets | |||
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | 164 | 123 | 0 |
Short-term investments and cash equivalents | |||
Schedule of Gain (Loss) on Investments [Line Items] | |||
Realized investment gains (losses), net | $ 759 | $ 50 | $ 85 |
Investments (Net Unrealized Gai
Investments (Net Unrealized Gains Losses on Investments by Asset Class) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | $ 736,930 | $ (416,909) | $ (59,412) |
Fixed maturities | Available-for-sale | OTTI | |||
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | 14,309 | (3,334) | 12,311 |
Fixed maturities | Available-for-sale | All other | |||
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | 722,310 | (411,458) | (46,791) |
Equity securities | Available-for-sale | |||
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | 0 | 0 | 4 |
Derivatives designated as cash flow hedges | |||
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | (287) | (3,849) | (25,851) |
Affiliated notes | |||
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | 598 | 658 | 829 |
Other Investments | |||
Gain (Loss) on Securities [Line Items] | |||
Net Unrealized Gains (Losses) on Investments | $ 0 | $ 1,074 | $ 86 |
Investments Investments (Repurc
Investments Investments (Repurchase Agreement and Securities Lending) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | $ 0 | $ 384 |
Overnight & Continuous | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 384 |
Up to 30 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 0 |
30 days or greater | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 0 |
Foreign government bonds | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 0 |
Foreign government bonds | Overnight & Continuous | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 0 |
Foreign government bonds | Up to 30 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 0 |
U.S. public corporate securities | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 384 |
U.S. public corporate securities | Overnight & Continuous | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | 0 | 384 |
U.S. public corporate securities | Up to 30 Days | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Total cash collateral for loaned securities | $ 0 | $ 0 |
Investments (Securities Pledged
Investments (Securities Pledged) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Total securities pledged | $ 0 | $ 365 |
Total liabilities supported by pledged collateral | 0 | 384 |
Cash Collateral For Loaned Securities | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Total liabilities supported by pledged collateral | 0 | 384 |
Fixed maturities | Available-for-sale | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Total securities pledged | $ 0 | $ 365 |
Derivative Instruments (Gross N
Derivative Instruments (Gross Notional Amount and Fair Value of Derivatives Contracts) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||
Notional | $ 137,753,691 | $ 147,248,020 |
Assets | 7,324,051 | 4,847,794 |
Liabilities | (3,206,949) | (2,140,789) |
Future Policy Benefits | ||
Derivative [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative, Net | (11,823,000) | (8,332,000) |
Policyholders' account balances | ||
Derivative [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative, Net | (197,000) | (42,000) |
Other assets | ||
Derivative [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative, Net | 8,000 | 0 |
Reinsurance Recoverables (Payables) | ||
Derivative [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative, Net | 350,000 | 240,000 |
Derivatives Designated as Hedge Accounting Instruments: | ||
Derivative [Line Items] | ||
Notional | 1,172,899 | 768,075 |
Assets | 39,019 | 33,348 |
Liabilities | (26,511) | (21,794) |
Derivatives Designated as Hedge Accounting Instruments: | Foreign Currency Swaps | ||
Derivative [Line Items] | ||
Notional | 1,172,899 | 768,075 |
Assets | 39,019 | 33,348 |
Liabilities | (26,511) | (21,794) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | ||
Derivative [Line Items] | ||
Notional | 136,580,792 | 146,479,945 |
Assets | 7,285,032 | 4,814,446 |
Liabilities | (3,180,438) | (2,118,995) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate Futures | ||
Derivative [Line Items] | ||
Notional | 3,857,700 | 908,100 |
Assets | 638 | 4,380 |
Liabilities | (5,872) | (664) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate Swaps | ||
Derivative [Line Items] | ||
Notional | 88,557,425 | 82,172,825 |
Assets | 6,598,625 | 3,344,033 |
Liabilities | (1,997,944) | (1,395,270) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate Option | ||
Derivative [Line Items] | ||
Notional | 12,583,000 | 19,255,000 |
Assets | 283,386 | 139,765 |
Liabilities | (172,085) | (245,523) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate Forwards | ||
Derivative [Line Items] | ||
Notional | 959,772 | 1,713,947 |
Assets | 24,487 | 56,562 |
Liabilities | (4,185) | (1,976) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Foreign Currency Forwards | ||
Derivative [Line Items] | ||
Notional | 16,683 | 19,467 |
Assets | 0 | 287 |
Liabilities | (394) | (27) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Foreign Currency Swaps | ||
Derivative [Line Items] | ||
Notional | 234,767 | 231,245 |
Assets | 11,482 | 11,659 |
Liabilities | (663) | (2,850) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Equity Future | ||
Derivative [Line Items] | ||
Notional | 1,191,237 | 860,718 |
Assets | 0 | 0 |
Liabilities | (2,638) | (6,629) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Total Return Swaps | ||
Derivative [Line Items] | ||
Notional | 16,314,165 | 14,456,836 |
Assets | 36,692 | 986,130 |
Liabilities | (573,957) | (53,235) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Equity Options | ||
Derivative [Line Items] | ||
Notional | 12,866,043 | 26,861,807 |
Assets | 329,722 | 271,630 |
Liabilities | $ (422,700) | $ (412,821) |
Derivative Instruments (Offsett
Derivative Instruments (Offsetting Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Offsetting of Financial Assets, Derivatives | ||
Gross Amounts of Recognized Financial Instruments | $ 7,324,051 | $ 4,847,794 |
Gross Amounts Offset in the Statements of Financial Position | (7,324,049) | (4,804,816) |
Net Amounts Presented in the Statements of Financial Position | 2 | 42,978 |
Financial Instruments/Collateral | 0 | 0 |
Net Amount | 2 | 42,978 |
Securities purchased under agreement to resell | ||
Gross Amounts of Recognized Financial Instruments | 302,000 | 675,000 |
Gross Amounts Offset in the Statements of Financial Position | 0 | 0 |
Net Amounts Presented in the Statements of Financial Position | 302,000 | 675,000 |
Financial Instruments/Collateral | (302,000) | (675,000) |
Net Amount | 0 | 0 |
Total Assets | ||
Gross Amounts of Recognized Financial Instruments | 7,626,051 | 5,522,794 |
Gross Amounts Offset in the Statements of Financial Position | (7,324,049) | (4,804,816) |
Net Amounts Presented in the Statements of Financial Position | 302,002 | 717,978 |
Financial Instruments/Collateral | (302,000) | (675,000) |
Net Amount | 2 | 42,978 |
Offsetting of Financial Liabilities, Derivatives | ||
Gross Amounts of Recognized Financial Instruments | 3,206,949 | 2,140,789 |
Gross Amounts Offset in the Statements of Financial Position | (3,053,132) | (2,134,160) |
Net Amounts Presented in the Statements of Financial Position | 153,817 | 6,629 |
Financial Instruments/Collateral | (820) | (6,629) |
Net Amount | 152,997 | 0 |
Securities sold under agreement to repurchase | ||
Gross Amounts of Recognized Financial Instruments | 0 | 0 |
Gross Amounts Offset in the Statements of Financial Position | 0 | 0 |
Net Amounts Presented in the Statements of Financial Position | 0 | 0 |
Financial Instruments/Collateral | 0 | 0 |
Net Amount | 0 | 0 |
Total Liabilities | ||
Gross Amounts of Recognized Financial Instruments | 3,206,949 | 2,140,789 |
Gross Amounts Offset in the Statements of Financial Position | (3,053,132) | (2,134,160) |
Net Amounts Presented in the Statements of Financial Position | 153,817 | 6,629 |
Financial Instruments/Collateral | (820) | (6,629) |
Net Amount | $ 152,997 | $ 0 |
Derivative Instruments (Financi
Derivative Instruments (Financial Statement Classification and Impact of Derivatives Used in Qualifying and Non-qualifying Hedge Relationships) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | $ (2,677,559) | $ 967,503 | $ (801,429) |
Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 12,104 | 8,285 | 6,152 |
Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (3,778) | 13,412 | (11,226) |
Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 3,520 | 22,002 | (37,596) |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (1,257) | (845) | 3,052 |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 12,104 | 8,285 | 6,152 |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (3,793) | 13,321 | (11,043) |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 3,520 | 22,002 | (37,596) |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Currency/Interest Rate | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (1,257) | (845) | 3,052 |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Currency/Interest Rate | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 12,104 | 8,285 | 6,152 |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Currency/Interest Rate | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (3,793) | 13,321 | (11,043) |
Derivatives Designated as Hedge Accounting Instruments: | Cash flow hedges | Currency/Interest Rate | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 3,520 | 22,002 | (37,596) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (2,676,302) | 968,348 | (804,481) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 15 | 91 | (183) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 3,309,573 | (1,021,687) | 550,797 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Interest Rate | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (153) | 1,022 | (454) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency/Interest Rate | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 11,964 | 21,888 | (33,225) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency/Interest Rate | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency/Interest Rate | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 15 | 91 | (183) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Currency/Interest Rate | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Credit | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 1,775 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Credit | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Credit | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Credit | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Equity | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (3,730,006) | 995,958 | (2,000,297) |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Equity | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Equity | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Equity | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Embedded Derivatives | Realized Investment Gains (Losses) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | (2,269,455) | 971,167 | 678,698 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Embedded Derivatives | Net Investment Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Embedded Derivatives | Other Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | 0 | 0 | 0 |
Derivatives Not Qualifying as Hedge Accounting Instruments: | Embedded Derivatives | Accumulated Other Comprehensive Income (loss) | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative Instruments Gain (Loss) Recognized In Income Net | $ 0 | $ 0 | $ 0 |
Derivative Instruments (Current
Derivative Instruments (Current Period Cash Flow Hedges in AOCI (loss) before Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Cumulative effect of adoption | $ 42 | ||
Cash flow hedges in AOCI | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Balance, beginning | $ (3,849) | (25,851) | $ 11,745 |
Amount recorded in AOCI | 10,574 | 42,763 | (39,434) |
Amount reclassified into current period earnings | (7,054) | (20,761) | 1,838 |
Balance, ending | (287) | (3,849) | (25,851) |
Currency/Interest Rate | Accumulated Gain (Loss), Net, Cash Flow Hedge | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Amount recorded in AOCI | 10,574 | 42,763 | (39,434) |
Amount reclassified into current period earnings | $ (7,054) | $ (20,761) | $ 1,838 |
Derivative Instruments (Narrati
Derivative Instruments (Narrative) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ 16 |
Fair Value of Assets and Liab_3
Fair Value of Assets and Liabilities (Balances of Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | $ 13,202,365 | $ 9,771,673 |
Fixed maturities, trading | 383,198 | 289,752 |
Equity securities | 67,503 | 20,613 |
Other invested assets | 474,013 | 348,541 |
Other assets | 139,933 | 85,310 |
Reinsurance recoverables | 621,510 | 572,102 |
Receivables from parent and affiliates | 62,765 | 46,381 |
Separate account assets | 32,665,431 | 31,210,346 |
TOTAL ASSETS | 58,834,997 | 54,677,844 |
Future policy benefits | 12,932,461 | 9,368,986 |
Policyholders’ account balances | 6,180,359 | 5,353,596 |
Payables to parent and affiliates | 185,156 | 30,846 |
Other liabilities | 447,405 | 811,016 |
TOTAL LIABILITIES | 53,307,642 | 47,936,276 |
Future Policy Benefits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative, Net Liability | 11,823,000 | 8,332,000 |
Embedded Derivative, Fair Value of Embedded Derivative Gross Asset | 583,000 | 625,000 |
Embedded Derivative, Fair Value of Embedded Derivative Gross Liability | 12,406,000 | 8,957,000 |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 13,202,365 | 9,771,673 |
Fixed maturities, trading | 383,198 | 289,752 |
Equity securities | 57,503 | 10,613 |
Short-term investments | 260,354 | 29,818 |
Cash equivalents | 1,805,605 | 3,692,359 |
Other invested assets | 2 | 42,978 |
Other assets | 8,059 | 0 |
Reinsurance recoverables | 349,820 | 239,911 |
Receivables from parent and affiliates | 2,573 | 37,193 |
Subtotal excluding separate account assets | 16,069,479 | 14,114,297 |
Separate account assets | 32,665,431 | 31,210,346 |
TOTAL ASSETS | 48,734,910 | 45,324,643 |
Future policy benefits | 11,822,998 | 8,332,474 |
Policyholders’ account balances | 196,892 | 42,350 |
Payables to parent and affiliates | 145,947 | 0 |
Other liabilities | 8,130 | 6,629 |
TOTAL LIABILITIES | 12,173,967 | 8,381,453 |
Asset Netting | (7,324,049) | (4,804,816) |
Liability Netting | (3,053,132) | (2,134,160) |
Netting | 4,271,000 | 2,671,000 |
Fair Value, Measurements, Recurring | Other invested assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Asset Netting | (7,324,049) | (4,804,816) |
Fair Value, Measurements, Recurring | Payables to parent and affiliates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liability Netting | (3,052,493) | (2,133,496) |
Fair Value, Measurements, Recurring | Other liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liability Netting | (639) | (664) |
Fair Value, Measurements, Recurring | U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 7,119,824 | 4,884,091 |
Fair Value, Measurements, Recurring | Obligations of U.S. states and their political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 259,682 | 131,164 |
Fair Value, Measurements, Recurring | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 222,884 | 199,636 |
Fair Value, Measurements, Recurring | U.S. corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 1,740,676 | 1,473,973 |
Fair Value, Measurements, Recurring | U.S. corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 1,207,339 | 1,062,953 |
Fair Value, Measurements, Recurring | Foreign corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 337,987 | 291,086 |
Fair Value, Measurements, Recurring | Foreign corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 1,213,485 | 812,232 |
Fair Value, Measurements, Recurring | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 444,438 | 505,244 |
Fair Value, Measurements, Recurring | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 578,289 | 361,880 |
Fair Value, Measurements, Recurring | Residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 77,761 | 49,414 |
Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fixed maturities, trading | 0 | 0 |
Equity securities | 5,314 | 4,896 |
Short-term investments | 0 | 0 |
Cash equivalents | 150,631 | 1,098,903 |
Other invested assets | 639 | 4,380 |
Other assets | 0 | 0 |
Reinsurance recoverables | 0 | 0 |
Receivables from parent and affiliates | 0 | 0 |
Subtotal excluding separate account assets | 156,584 | 1,108,179 |
Separate account assets | 0 | 0 |
TOTAL ASSETS | 156,584 | 1,108,179 |
Future policy benefits | 0 | 0 |
Policyholders’ account balances | 0 | 0 |
Payables to parent and affiliates | 0 | 0 |
Other liabilities | 8,509 | 7,293 |
TOTAL LIABILITIES | 8,509 | 7,293 |
Fair Value, Measurements, Recurring | Level 1 | U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Obligations of U.S. states and their political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | U.S. corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | U.S. corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Foreign corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Foreign corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 13,068,726 | 9,668,753 |
Fixed maturities, trading | 378,734 | 289,752 |
Equity securities | 46,942 | 12 |
Short-term investments | 260,354 | 29,818 |
Cash equivalents | 1,654,974 | 2,593,456 |
Other invested assets | 7,323,412 | 4,843,414 |
Other assets | 0 | 0 |
Reinsurance recoverables | 47,006 | 0 |
Receivables from parent and affiliates | 2,573 | 37,193 |
Subtotal excluding separate account assets | 22,782,721 | 17,462,398 |
Separate account assets | 32,665,431 | 31,210,346 |
TOTAL ASSETS | 55,448,152 | 48,672,744 |
Future policy benefits | 0 | 0 |
Policyholders’ account balances | 0 | 0 |
Payables to parent and affiliates | 3,198,440 | 2,133,496 |
Other liabilities | 260 | 0 |
TOTAL LIABILITIES | 3,198,700 | 2,133,496 |
Fair Value, Measurements, Recurring | Level 2 | U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 7,109,277 | 4,875,959 |
Fair Value, Measurements, Recurring | Level 2 | Obligations of U.S. states and their political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 259,682 | 131,164 |
Fair Value, Measurements, Recurring | Level 2 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 222,884 | 199,636 |
Fair Value, Measurements, Recurring | Level 2 | U.S. corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 1,732,632 | 1,473,973 |
Fair Value, Measurements, Recurring | Level 2 | U.S. corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 1,155,464 | 1,008,632 |
Fair Value, Measurements, Recurring | Level 2 | Foreign corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 337,800 | 291,086 |
Fair Value, Measurements, Recurring | Level 2 | Foreign corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 1,169,324 | 781,101 |
Fair Value, Measurements, Recurring | Level 2 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 425,613 | 495,908 |
Fair Value, Measurements, Recurring | Level 2 | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 578,289 | 361,880 |
Fair Value, Measurements, Recurring | Level 2 | Residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 77,761 | 49,414 |
Fair Value, Measurements, Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 133,639 | 102,920 |
Fixed maturities, trading | 4,464 | 0 |
Equity securities | 5,247 | 5,705 |
Short-term investments | 0 | 0 |
Cash equivalents | 0 | 0 |
Other invested assets | 0 | 0 |
Other assets | 8,059 | 0 |
Reinsurance recoverables | 302,814 | 239,911 |
Receivables from parent and affiliates | 0 | 0 |
Subtotal excluding separate account assets | 454,223 | 348,536 |
Separate account assets | 0 | 0 |
TOTAL ASSETS | 454,223 | 348,536 |
Future policy benefits | 11,822,998 | 8,332,474 |
Policyholders’ account balances | 196,892 | 42,350 |
Payables to parent and affiliates | 0 | 0 |
Other liabilities | 0 | 0 |
TOTAL LIABILITIES | 12,019,890 | 8,374,824 |
Fair Value, Measurements, Recurring | Level 3 | U.S. Treasury securities and obligations of U.S. government authorities and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 10,547 | 8,132 |
Fair Value, Measurements, Recurring | Level 3 | Obligations of U.S. states and their political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | U.S. corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 8,044 | 0 |
Fair Value, Measurements, Recurring | Level 3 | U.S. corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 51,875 | 54,321 |
Fair Value, Measurements, Recurring | Level 3 | Foreign corporate public securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 187 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Foreign corporate private securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 44,161 | 31,131 |
Fair Value, Measurements, Recurring | Level 3 | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 18,825 | 9,336 |
Fair Value, Measurements, Recurring | Level 3 | Commercial mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Residential mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fixed maturities, available-for-sale: | 0 | 0 |
Other invested assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value investment measured at NAV per share | $ 10,500 | $ 8,000 |
Fair Value of Assets and Liab_4
Fair Value of Assets and Liabilities (Quantitative Info for Level 3 Inputs) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Corporate securities | $ 63,647 | $ 18,765 |
Future policy benefits | 12,932,461 | 9,368,986 |
Policyholders’ account balances | 6,180,359 | 5,353,596 |
Fair Value, Measurements, Recurring | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Future policy benefits | 11,822,998 | 8,332,474 |
Policyholders’ account balances | $ 196,892 | 42,350 |
Level 3 | Minimum | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Fair Value Inputs, Policyholder Age | 45 years | |
Level 3 | Minimum | Future policy benefits | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Mortality rate | 0.00% | |
Level 3 | Maximum | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Fair Value Inputs, Policyholder Age | 90 years | |
Level 3 | Fair Value, Measurements, Recurring | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Future policy benefits | $ 11,822,998 | 8,332,474 |
Policyholders’ account balances | $ 196,892 | $ 42,350 |
Level 3 | Internal | Minimum | Discounted cash flow | Future policy benefits | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Lapse rate | 1.00% | 1.00% |
Spread over LIBOR | 0.10% | 0.36% |
Utilization rate | 43.00% | 50.00% |
Withdrawal rate (greater than maximum range for current year) | 78.00% | 78.00% |
Mortality rate | 0.00% | 0.00% |
Equity volatility curve | 13.00% | 18.00% |
Level 3 | Internal | Minimum | Discounted cash flow | Policyholders' account balances | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Lapse rate | 1.00% | |
Spread over LIBOR | 0.10% | |
Equity volatility curve | 6.00% | |
Level 3 | Internal | Minimum | Discounted cash flow | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Discount rate | 4.79% | 7.00% |
Level 3 | Internal | Minimum | Market comparables | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
EBITDA Multiples | 6.7 | 6.7 |
Level 3 | Internal | Minimum | Liquidation | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Liquidation value | 41.00% | |
Level 3 | Internal | Maximum | Discounted cash flow | Future policy benefits | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Lapse rate | 18.00% | 13.00% |
Spread over LIBOR | 1.23% | 1.60% |
Utilization rate | 97.00% | 97.00% |
Withdrawal rate (greater than maximum range for current year) | 100.00% | 100.00% |
Mortality rate | 15.00% | 15.00% |
Equity volatility curve | 23.00% | 22.00% |
Level 3 | Internal | Maximum | Discounted cash flow | Policyholders' account balances | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Lapse rate | 42.00% | |
Spread over LIBOR | 1.23% | |
Equity volatility curve | 25.00% | |
Level 3 | Internal | Maximum | Discounted cash flow | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Discount rate | 20.00% | 20.00% |
Level 3 | Internal | Maximum | Market comparables | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
EBITDA Multiples | 6.7 | 6.7 |
Level 3 | Internal | Maximum | Liquidation | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Liquidation value | 41.00% | |
Level 3 | Internal | Weighted Average | Discounted cash flow | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Discount rate | 8.66% | 11.30% |
Level 3 | Internal | Weighted Average | Market comparables | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
EBITDA Multiples | 6.7 | 6.7 |
Level 3 | Internal | Weighted Average | Liquidation | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Liquidation value | 41.00% | |
Level 3 | Internal | Fair Value, Measurements, Recurring | Future policy benefits | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Future policy benefits | $ 11,822,998 | $ 8,332,474 |
Level 3 | Internal | Fair Value, Measurements, Recurring | Policyholders' account balances | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Policyholders’ account balances | 196,892 | |
Level 3 | Internal | Fair Value, Measurements, Recurring | Corporate securities | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Corporate securities | 17,149 | 18,609 |
Level 3 | Internal | Fair Value, Measurements, Recurring | Reinsurance recoverables | ||
Fair Value Inputs, Assets and Liabilities, Quantitative Information [Line Items] | ||
Reinsurance recoverables | $ 302,814 | $ 239,911 |
Fair Value of Assets and Liab_5
Fair Value of Assets and Liabilities (Changes in Level 3 Assets and Liabilities) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | $ 5,705 | $ 9,758 | |
Purchases | 0 | 0 | |
Sales | (929) | (3,609) | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Other | 0 | 147 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 5,247 | 5,705 | $ 9,758 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 471 | (591) | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 482 | (1,208) | |
Equity securities | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Equity securities | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 471 | (591) | 689 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 482 | (1,208) | 338 |
Equity securities | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 351 |
Equity securities | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Other invested assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 0 | 147 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Other | 0 | (147) | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 0 | 0 | 147 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | |
Other invested assets | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | (7) |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | (7) |
Other invested assets | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Other invested assets | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Other invested assets | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Short-term Investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 0 | 87 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | (43) | |
Other | 0 | (24) | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 0 | 0 | 87 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | (20) | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | (55) | |
Short-term Investments | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | (20) | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | (55) | 0 |
Short-term Investments | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Short-term Investments | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Short-term Investments | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Cash equivalents | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 0 | 0 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | (13) | |
Other | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 0 | 0 | 0 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 13 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | |
Cash equivalents | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 13 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Cash equivalents | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Cash equivalents | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Cash equivalents | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Other assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 0 | 0 | |
Purchases | 7,618 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Other | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 8,059 | 0 | 0 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 441 | 0 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 441 | 0 | |
Other assets | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 441 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 441 | 0 | 0 |
Other assets | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Other assets | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Other assets | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Reinsurance recoverables | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 239,911 | 244,006 | |
Purchases | 17,950 | 19,061 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Other | 21,896 | 5,601 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | (47,006) | 0 | |
Fair Value, end of period | 302,814 | 239,911 | 244,006 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 70,063 | (28,757) | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 57,652 | (19,962) | |
Reinsurance recoverables | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 70,063 | (28,757) | (18,240) |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 57,652 | (19,962) | (10,303) |
Reinsurance recoverables | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Reinsurance recoverables | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Reinsurance recoverables | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Future Policy Benefits | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | (8,332,474) | (8,151,902) | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | (1,080,566) | (1,024,486) | |
Settlements | 0 | 0 | |
Other | 0 | 0 | |
Transfers Into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | (11,822,998) | (8,332,474) | (8,151,902) |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (2,409,958) | 843,914 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (2,710,167) | 529,804 | |
Future Policy Benefits | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (2,409,958) | 843,914 | 552,047 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (2,710,167) | 529,804 | 307,529 |
Future Policy Benefits | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Future Policy Benefits | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Future Policy Benefits | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Policyholders' account balances | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | (42,350) | 0 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | (122,295) | (48,401) | |
Settlements | 0 | 0 | |
Other | 0 | 0 | |
Transfers Into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | (196,892) | (42,350) | 0 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (32,247) | 6,051 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (22,699) | 6,051 | |
Policyholders' account balances | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (32,247) | 6,051 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (22,699) | 6,051 | 0 |
Policyholders' account balances | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Policyholders' account balances | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Policyholders' account balances | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Available-for-sale | Fixed maturities | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (3,562) | (6,693) | (6,301) |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (3,799) | (6,627) | (6,506) |
Available-for-sale | Fixed maturities | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Available-for-sale | Fixed maturities | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 2,690 | (5,194) | (3,410) |
Available-for-sale | Fixed maturities | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 251 | 241 | 8,057 |
Available-for-sale | Fixed maturities | US government | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 8,132 | 5,237 | |
Purchases | 2,415 | 2,895 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Other | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 10,547 | 8,132 | 5,237 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | |
Available-for-sale | Fixed maturities | Corporate securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 85,452 | 95,206 | |
Purchases | 61,563 | 15,268 | |
Sales | 0 | (275) | |
Issuances | 0 | 0 | |
Settlements | (43,724) | (22,332) | |
Other | 0 | 24 | |
Transfers into Level 3 | 4,655 | 9,969 | |
Transfers out of Level 3 | (2,556) | (1,486) | |
Fair Value, end of period | 104,267 | 85,452 | 95,206 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (1,123) | (10,922) | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (3,797) | (6,627) | |
Available-for-sale | Fixed maturities | Structured securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 9,336 | 185,358 | |
Purchases | 44,273 | 84,810 | |
Sales | 0 | (14,236) | |
Issuances | 0 | 0 | |
Settlements | (5,259) | (37,672) | |
Other | 0 | 0 | |
Transfers into Level 3 | 551 | 51,979 | |
Transfers out of Level 3 | (30,578) | (260,179) | |
Fair Value, end of period | 18,825 | 9,336 | 185,358 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 502 | (724) | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (2) | 0 | |
Trading | Fixed maturities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, beginning of period | 0 | 0 | |
Purchases | 0 | 0 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 0 | |
Other | 0 | 0 | |
Transfers into Level 3 | 5,021 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 4,464 | 0 | 0 |
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (557) | 0 | |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (543) | 0 | |
Trading | Fixed maturities | Realized investment gains (losses), net | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | 0 | 0 | 0 |
Trading | Fixed maturities | Other Income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | (543) | 0 | 0 |
Unrealized gains (losses) for assets/liabilities still held: | |||
Included in earnings | (543) | 0 | 0 |
Trading | Fixed maturities | Included in other comprehensive income (loss) | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | 0 | 0 | 0 |
Trading | Fixed maturities | Net investment income | |||
Total gains (losses) (realized/unrealized): | |||
Included in earnings | $ (14) | $ 0 | $ 0 |
Fair Value of Assets and Liab_6
Fair Value of Assets and Liabilities (Financial Instruments where Carrying Amounts and Fair Values May Differ) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets: | ||||
Policy loans | $ 12,366 | $ 12,805 | ||
Short-term investments | 335,358 | 37,568 | ||
Cash and cash equivalents | 2,795,163 | 4,503,534 | $ 1,639,939 | $ 1,848,039 |
Accrued investment income | 102,724 | 90,895 | ||
Reinsurance recoverables | 621,510 | 572,102 | ||
Receivables from parent and affiliates | 62,765 | 46,381 | ||
Liabilities: | ||||
Cash collateral for loaned securities | 0 | 384 | ||
Short-term debt | 242,094 | 140,569 | ||
Reinsurance payables | 235,318 | 232,937 | ||
Fair Value | ||||
Assets: | ||||
Commercial mortgage and other loans | 1,512,283 | 1,339,707 | ||
Policy loans | 12,366 | 12,805 | ||
Short-term investments | 75,004 | 7,750 | ||
Cash and cash equivalents | 989,558 | 811,175 | ||
Accrued investment income | 102,724 | 90,895 | ||
Reinsurance recoverables | 56,171 | 55,236 | ||
Receivables from parent and affiliates | 60,779 | 9,188 | ||
Other assets | 64,999 | 3,735 | ||
Total assets | 2,873,884 | 2,330,491 | ||
Liabilities: | ||||
Policyholders’ account balances - investment contracts | 1,445,486 | 560,548 | ||
Cash collateral for loaned securities | 0 | 384 | ||
Short-term debt | 245,617 | 139,843 | ||
Long-term debt | 446,105 | 791,670 | ||
Reinsurance payables | 50,035 | 55,236 | ||
Payables to parent and affiliates | 39,209 | 30,846 | ||
Other liabilities | 205,988 | 554,162 | ||
Separate account liabilities - investment contracts | 54 | 71 | ||
Total liabilities | 2,432,494 | 2,132,760 | ||
Carrying Amount | ||||
Assets: | ||||
Commercial mortgage and other loans | 1,471,522 | 1,353,478 | ||
Policy loans | 12,366 | 12,805 | ||
Short-term investments | 75,004 | 7,750 | ||
Cash and cash equivalents | 989,558 | 811,175 | ||
Accrued investment income | 102,724 | 90,895 | ||
Reinsurance recoverables | 55,796 | 55,236 | ||
Receivables from parent and affiliates | 60,192 | 9,188 | ||
Other assets | 64,999 | 3,735 | ||
Total assets | 2,832,161 | 2,344,262 | ||
Liabilities: | ||||
Policyholders’ account balances - investment contracts | 1,438,742 | 565,903 | ||
Cash collateral for loaned securities | 0 | 384 | ||
Short-term debt | 242,094 | 140,569 | ||
Long-term debt | 419,418 | 787,596 | ||
Reinsurance payables | 50,035 | 55,236 | ||
Payables to parent and affiliates | 39,209 | 30,846 | ||
Other liabilities | 205,988 | 554,162 | ||
Separate account liabilities - investment contracts | 54 | 71 | ||
Total liabilities | 2,395,540 | 2,134,767 | ||
Level 1 | Fair Value | ||||
Assets: | ||||
Commercial mortgage and other loans | 0 | 0 | ||
Policy loans | 0 | 0 | ||
Short-term investments | 75,004 | 7,750 | ||
Cash and cash equivalents | 687,558 | 136,175 | ||
Accrued investment income | 0 | 0 | ||
Reinsurance recoverables | 0 | 0 | ||
Receivables from parent and affiliates | 0 | 0 | ||
Other assets | 0 | 0 | ||
Total assets | 762,562 | 143,925 | ||
Liabilities: | ||||
Policyholders’ account balances - investment contracts | 0 | 0 | ||
Cash collateral for loaned securities | 0 | 0 | ||
Short-term debt | 0 | 0 | ||
Long-term debt | 0 | 0 | ||
Reinsurance payables | 0 | 0 | ||
Payables to parent and affiliates | 0 | 0 | ||
Other liabilities | 0 | 0 | ||
Separate account liabilities - investment contracts | 0 | 0 | ||
Total liabilities | 0 | 0 | ||
Level 2 | Fair Value | ||||
Assets: | ||||
Commercial mortgage and other loans | 0 | 0 | ||
Policy loans | 0 | 0 | ||
Short-term investments | 0 | 0 | ||
Cash and cash equivalents | 302,000 | 675,000 | ||
Accrued investment income | 102,724 | 90,895 | ||
Reinsurance recoverables | 0 | 0 | ||
Receivables from parent and affiliates | 10,192 | 9,188 | ||
Other assets | 1,893 | 3,735 | ||
Total assets | 416,809 | 778,818 | ||
Liabilities: | ||||
Policyholders’ account balances - investment contracts | 0 | 0 | ||
Cash collateral for loaned securities | 0 | 384 | ||
Short-term debt | 245,617 | 139,843 | ||
Long-term debt | 446,105 | 791,670 | ||
Reinsurance payables | 0 | 0 | ||
Payables to parent and affiliates | 39,209 | 30,846 | ||
Other liabilities | 205,988 | 554,162 | ||
Separate account liabilities - investment contracts | 54 | 71 | ||
Total liabilities | 936,973 | 1,516,976 | ||
Level 3 | Fair Value | ||||
Assets: | ||||
Commercial mortgage and other loans | 1,512,283 | 1,339,707 | ||
Policy loans | 12,366 | 12,805 | ||
Short-term investments | 0 | 0 | ||
Cash and cash equivalents | 0 | 0 | ||
Accrued investment income | 0 | 0 | ||
Reinsurance recoverables | 56,171 | 55,236 | ||
Receivables from parent and affiliates | 50,587 | 0 | ||
Other assets | 63,106 | 0 | ||
Total assets | 1,694,513 | 1,407,748 | ||
Liabilities: | ||||
Policyholders’ account balances - investment contracts | 1,445,486 | 560,548 | ||
Cash collateral for loaned securities | 0 | 0 | ||
Short-term debt | 0 | 0 | ||
Long-term debt | 0 | 0 | ||
Reinsurance payables | 50,035 | 55,236 | ||
Payables to parent and affiliates | 0 | 0 | ||
Other liabilities | 0 | 0 | ||
Separate account liabilities - investment contracts | 0 | 0 | ||
Total liabilities | $ 1,495,521 | $ 615,784 |
Deferred Policy Acquisition C_3
Deferred Policy Acquisition Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | |||
Balance, beginning of year | $ 4,447,505 | $ 4,596,565 | $ 4,344,361 |
Capitalization of commissions, sales and issue expenses | 412,627 | 372,996 | 277,586 |
Amortization-Impact of assumption and experience unlocking and true-ups | 245,276 | (113,534) | 288,974 |
Amortization-All other | (518,129) | (476,261) | (275,028) |
Change in unrealized investment gains and losses | (131,596) | 67,739 | (39,328) |
Balance, end of year | $ 4,455,683 | $ 4,447,505 | $ 4,596,565 |
Value of Business Acquired (Bal
Value of Business Acquired (Balance of and Changes in VOBA) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Movement in Present Value of Future Insurance Profits [Roll Forward] | |||
Balance, beginning of year | $ 33,222 | $ 35,109 | $ 30,287 |
Amortization-Impact of assumption and experience unlocking and true-ups | 2,093 | 1,485 | 10,035 |
Amortization-All other | (6,376) | (7,348) | (7,422) |
Interest | 1,778 | 1,983 | 2,001 |
Change in unrealized investment gains and losses | (692) | 1,993 | 208 |
Balance, end of year | $ 30,025 | $ 33,222 | $ 35,109 |
Value of Business Acquired (Est
Value of Business Acquired (Estimated Future Amortization, Net of Interest) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Present Value of Future Insurance Profits [Abstract] | |
Estimated future VOBA amortization - 2020 | $ 4,610 |
Estimated future VOBA amortization - 2021 | 3,976 |
Estimated future VOBA amortization - 2022 | 3,421 |
Estimated future VOBA amortization - 2023 | 2,926 |
Estimated future VOBA amortization - 2024 | $ 2,491 |
Policyholders' Liabilities (Fut
Policyholders' Liabilities (Future Policy Benefits) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Liability for Future Policy Benefit, before Reinsurance [Abstract] | ||
Life insurance – domestic | $ 71 | $ 74 |
Individual and group annuities and supplementary contracts | 1,087,060 | 1,021,854 |
Other contract liabilities | 11,845,330 | 8,347,058 |
Total future policy benefits | $ 12,932,461 | $ 9,368,986 |
Policyholders' Liabilities (Nar
Policyholders' Liabilities (Narrative) (Details) | Dec. 31, 2019 |
Individual and group annuities and supplementary contracts | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Percentage of reserves based on interest rates in excess of 8 percent | 1.00% |
Individual and group annuities and supplementary contracts | Minimum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Future Policy Benefits, Interest Rate | 0.00% |
Individual and group annuities and supplementary contracts | Maximum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Future Policy Benefits, Interest Rate | 8.30% |
Other contract liabilities | Minimum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Future Policy Benefits, Interest Rate | 1.90% |
Other contract liabilities | Maximum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Future Policy Benefits, Interest Rate | 3.30% |
Interest-sensitive life contracts | Minimum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Policyholders Account Balances, Interest rate | 3.50% |
Interest-sensitive life contracts | Maximum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Policyholders Account Balances, Interest rate | 6.00% |
Individual annuities | Minimum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Policyholders Account Balances, Interest rate | 0.00% |
Individual annuities | Maximum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Policyholders Account Balances, Interest rate | 6.50% |
Guaranteed interest accounts | Minimum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Policyholders Account Balances, Interest rate | 0.10% |
Guaranteed interest accounts | Maximum | |
Liability for Future Policy Benefit and Policyholders' Account Balances, by Product Segment [Line Items] | |
Liability for Policyholders Account Balances, Interest rate | 5.80% |
Policyholders' Liabilities (Pol
Policyholders' Liabilities (Policyholders' Account Balances) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Liability for Policyholders' Account Balances, by Product Segment [Line Items] | ||
Total policyholders’ account balances | $ 6,180,359 | $ 5,353,596 |
Interest-sensitive life contracts | ||
Liability for Policyholders' Account Balances, by Product Segment [Line Items] | ||
Total policyholders’ account balances | 14,391 | 15,049 |
Individual annuities | ||
Liability for Policyholders' Account Balances, by Product Segment [Line Items] | ||
Total policyholders’ account balances | 5,716,052 | 4,729,973 |
Guaranteed interest accounts | ||
Liability for Policyholders' Account Balances, by Product Segment [Line Items] | ||
Total policyholders’ account balances | $ 449,916 | $ 608,574 |
Certain Long-Duration Contrac_3
Certain Long-Duration Contracts with Guarantees (Variable Annuity Contracts) (Details) - Annuity Contracts - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Return of net deposits | In the Event of Death | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 120,240,930 | $ 106,779,202 |
Net amount at risk | $ 229,080 | $ 843,419 |
Average attained age of contractholders | 68 years | 67 years |
Minimum return or contract value | In the Event of Death | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 23,563,604 | $ 22,184,537 |
Net amount at risk | $ 2,254,621 | $ 4,322,406 |
Average attained age of contractholders | 70 years | 70 years |
Minimum return or contract value | At Annuitization / Accumulation | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Account value | $ 129,812,105 | $ 115,822,894 |
Net amount at risk | $ 3,989,437 | $ 7,252,486 |
Average attained age of contractholders | 69 years | 68 years |
Average period remaining until earliest expected annuitization | 0 years | 0 years |
Certain Long-Duration Contrac_4
Certain Long-Duration Contracts With Guarantees (Separate Account Investment Options) (Details) - Annuity Contracts - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Separate Account Investment [Line Items] | ||
Separate Account Investment Options | $ 139,147,485 | $ 124,084,371 |
Equity funds | ||
Fair Value, Separate Account Investment [Line Items] | ||
Separate Account Investment Options | 82,506,787 | 69,686,791 |
Bond funds | ||
Fair Value, Separate Account Investment [Line Items] | ||
Separate Account Investment Options | 53,763,563 | 51,855,361 |
Money market funds | ||
Fair Value, Separate Account Investment [Line Items] | ||
Separate Account Investment Options | $ 2,877,135 | $ 2,542,219 |
Certain Long-Duration Contrac_5
Certain Long-Duration Contracts with Guarantees (Narrative) (Details) - USD ($) $ in Billions | Dec. 31, 2019 | Dec. 31, 2018 |
Annuity Contracts | Market Value Adjusted | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
General Account Investment Option | $ 4.7 | $ 4.9 |
Certain Long-Duration Contrac_6
Certain Long-Duration Contracts with Guarantees Liabilities for Guarantee Benefits (Details) - Annuity Contracts - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Beginning balance | $ 8,992,937 | $ 8,797,230 | $ 8,382,545 |
Incurred guarantee benefits | 3,562,205 | 286,847 | 462,488 |
Paid guarantee benefits | (54,895) | (70,802) | (60,851) |
Change in unrealized investment gains and losses | 26,651 | (20,338) | 13,048 |
Ending balance | 12,526,898 | 8,992,937 | 8,797,230 |
GMDB | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Beginning balance | 638,403 | 622,802 | 637,319 |
Incurred guarantee benefits | 68,142 | 103,596 | 29,605 |
Paid guarantee benefits | (51,418) | (67,887) | (57,053) |
Change in unrealized investment gains and losses | 26,377 | (20,108) | 12,931 |
Ending balance | 681,504 | 638,403 | 622,802 |
GMAB/GMWB/ GMIWB | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Beginning balance | 8,332,474 | 8,151,902 | 7,707,333 |
Incurred guarantee benefits | 3,490,524 | 180,572 | 444,569 |
Paid guarantee benefits | 0 | 0 | 0 |
Change in unrealized investment gains and losses | 0 | 0 | 0 |
Ending balance | 11,822,998 | 8,332,474 | 8,151,902 |
GMIB | |||
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward] | |||
Beginning balance | 22,060 | 22,526 | 37,893 |
Incurred guarantee benefits | 3,539 | 2,679 | (11,686) |
Paid guarantee benefits | (3,477) | (2,915) | (3,798) |
Change in unrealized investment gains and losses | 274 | (230) | 117 |
Ending balance | $ 22,396 | $ 22,060 | $ 22,526 |
Certain Long-Duration Contrac_7
Certain Long-Duration Contracts with Guarantees (Sales Inducements) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Movement in Deferred Sales Inducements [Roll Forward] | |||
Beginning balance | $ 889,598 | $ 1,020,786 | $ 978,823 |
Capitalization | 797 | 2,888 | 1,551 |
Amortization - Impact of assumption and experience unlocking and true-ups | 100,222 | (5,713) | 145,141 |
Amortization - All other | (146,620) | (149,236) | (94,014) |
Change in unrealized investment gains and losses | (31,273) | 20,873 | (10,715) |
Ending balance | $ 812,724 | $ 889,598 | $ 1,020,786 |
Reinsurance (Balance Sheet Rein
Reinsurance (Balance Sheet Reinsurance Results) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Effects of Reinsurance [Line Items] | ||||
Reinsurance recoverables | $ 621,510 | $ 572,102 | ||
Deferred policy acquisition costs | 4,455,683 | 4,447,505 | $ 4,596,565 | $ 4,344,361 |
Deferred sales inducements | 812,724 | 889,598 | 1,020,786 | 978,823 |
Value of business acquired | 30,025 | 33,222 | $ 35,109 | $ 30,287 |
Other assets | 139,933 | 85,310 | ||
Policyholders’ account balances | 6,180,359 | 5,353,596 | ||
Future policy benefits | 12,932,461 | 9,368,986 | ||
Reinsurance payables | 235,318 | 232,937 | ||
Other liabilities | 447,405 | 811,016 | ||
Impacts of Reinsurance | ||||
Effects of Reinsurance [Line Items] | ||||
Reinsurance recoverables | 621,510 | 572,102 | ||
Deferred policy acquisition costs | 3,725,719 | 3,703,166 | ||
Deferred sales inducements | 437,594 | 476,608 | ||
Value of business acquired | (2,275) | (2,431) | ||
Other assets | 65,819 | 79,992 | ||
Policyholders’ account balances | 3,253,474 | 3,098,537 | ||
Future policy benefits | 8,328,777 | 5,680,939 | ||
Reinsurance payables | 235,318 | 232,937 | ||
Other liabilities | 337,909 | 290,330 | ||
Unaffiliated activity | ||||
Effects of Reinsurance [Line Items] | ||||
Reinsurance payables | $ 100 | $ 100 |
Reinsurance (Reinsurance Recove
Reinsurance (Reinsurance Recoverable by Counterparty) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Effects of Reinsurance [Line Items] | ||
Total reinsurance recoverables | $ 621,510 | $ 572,102 |
Prudential Insurance | ||
Effects of Reinsurance [Line Items] | ||
Total reinsurance recoverables | 387,355 | 335,349 |
Pruco Life | ||
Effects of Reinsurance [Line Items] | ||
Total reinsurance recoverables | 233,933 | 236,716 |
Unaffiliated | ||
Effects of Reinsurance [Line Items] | ||
Total reinsurance recoverables | $ 222 | $ 37 |
Reinsurance (Income Statement R
Reinsurance (Income Statement Reinsurance Results) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Premiums: | |||
Direct | $ 29,022 | $ 37,895 | $ 33,908 |
Assumed | 31,570 | 31,989 | 32,890 |
Ceded | (1,042) | (2,619) | (3,225) |
Net premiums | 59,550 | 67,265 | 63,573 |
Policy charges and fee income: | |||
Direct | 477,478 | 549,500 | 622,099 |
Assumed | 1,638,023 | 1,661,484 | 1,632,132 |
Ceded | (34,455) | (39,706) | (44,652) |
Net policy charges and fee income | 2,081,046 | 2,171,278 | 2,209,579 |
Asset administration fees and other income: | |||
Direct | 141,884 | 96,743 | 129,847 |
Assumed | 306,945 | 301,549 | 293,275 |
Ceded | (8,346) | (9,136) | (9,747) |
Net asset administration fees and other income | 440,483 | 389,156 | 413,375 |
Realized investment gains (losses), net: | |||
Direct | (1,137,422) | 81,120 | (1,335,253) |
Assumed | (1,584,764) | 823,129 | 554,686 |
Ceded | 40,866 | (20,176) | (24,833) |
Realized investment gains (losses), net | (2,681,320) | 884,073 | (805,400) |
Policyholders' benefits (including change in reserves): | |||
Direct | 58,308 | 81,045 | 52,477 |
Assumed | 89,284 | 110,358 | 46,375 |
Ceded | (3,667) | (4,315) | 15,216 |
Net policyholders' benefits (including change in reserves) | 143,925 | 187,088 | 114,068 |
Interest credited to policyholders’ account balances: | |||
Direct | 82,444 | 127,018 | 9,834 |
Assumed | 84,182 | 132,324 | 24,708 |
Ceded | (5,417) | (10,167) | (4,262) |
Net interest credited to policyholders’ account balances | 161,209 | 249,175 | 30,280 |
Reinsurance expense allowances and general and administrative expenses, net of capitalization and amortization | 988,951 | 1,131,351 | 725,749 |
Unaffiliated activity | |||
Policy charges and fee income: | |||
Ceded | (1,000) | (1,000) | (2,000) |
Policyholders' benefits (including change in reserves): | |||
Ceded | $ (100) | $ (300) | $ (100) |
Income Taxes (Components of Inc
Income Taxes (Components of Income Tax Expense (Benefit)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current tax expense (benefit): | |||
U.S. federal | $ 14,381 | $ (422,999) | $ 501,088 |
State and local | 0 | 0 | 1,349 |
Total | 14,381 | (422,999) | 502,437 |
Deferred tax expense (benefit): | |||
U.S. federal | (305,482) | 584,503 | 698,662 |
State and local | 0 | 0 | 0 |
Total | (305,482) | 584,503 | 698,662 |
Total income tax expense (benefit) | (291,101) | 161,504 | 1,201,099 |
Total income tax expense (benefit) reported in equity related to: | |||
Other comprehensive income (loss) | 200,447 | (52,510) | 98,644 |
Additional paid-in capital | 0 | 0 | 0 |
Total income tax expense (benefit) | $ (90,654) | $ 108,994 | $ 1,299,743 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | 24 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Statutory federal income tax rate | 21.00% | 35.00% | ||
Tax Adjustments, Settlements, and Unusual Provisions | $ 193 | |||
Effective tax rate | 22.70% | 8.80% | 107.50% | |
Tax benefit from the reduction in net deferred tax liabilities | $ 0.2 | $ 882 | $ 882.3 | |
DRD constituting non-taxable investment income | $ 11 | 15 | 46 | |
Non-taxable investment income | 12 | 19 | 47 | |
Income (loss) from domestic operations | $ (1,280) | $ 1,844 | $ 1,118 | |
Income Taxes, Reconciling Items, Percent Of Income Tax Expense (Benefit) | 5.00% |
Income Taxes (Reconciliation To
Income Taxes (Reconciliation To Effective Rate) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 35.00% | |
Expected federal income tax expense (benefit) | $ (268,890) | $ 387,286 | $ 391,158 |
Non-taxable investment income | (12,019) | (18,954) | (46,625) |
Tax credits | (11,708) | (13,694) | (10,358) |
Changes in tax law | 0 | (193,306) | 882,175 |
Other | 1,516 | 172 | (15,251) |
Total income tax expense (benefit) | $ (291,101) | $ 161,504 | $ 1,201,099 |
Effective tax rate | 22.70% | 8.80% | 107.50% |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Insurance reserves | $ 1,716,039 | $ 1,521,729 |
Investments | 411,788 | 276,880 |
Deferred Tax Assets, Unrealized Losses on Trading Securities | 0 | 86,742 |
Other | 2,002 | 638 |
Deferred tax assets | 2,129,829 | 1,885,989 |
Deferred tax liabilities: | ||
DeferredTaxLiabilitiesVOBAandDAC | 929,882 | 929,849 |
Deferred sales inducements | 170,672 | 186,816 |
Deferred Tax Liabilities, Unrealized Gains on Trading Securities | 154,815 | 0 |
Deferred tax liabilities | 1,255,369 | 1,116,665 |
Deferred Tax Assets, Net | $ 874,460 | $ 769,324 |
Equity (Accumulated Other Compr
Equity (Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | [1] | Jan. 01, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning Balance | $ (324,373) | |||||
Income tax benefit (expense) | 291,101 | $ (161,504) | $ (1,201,099) | |||
Cumulative effect of adoption | 42 | |||||
Ending Balance | 428,612 | (324,373) | ||||
Foreign Currency Translation Adjustment | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning Balance | (1,078) | (7) | (78) | |||
Change in OCI before reclassifications | 182 | (1,354) | 109 | |||
Amounts reclassified from AOCI | 0 | 0 | 0 | |||
Income tax benefit (expense) | (38) | 285 | (38) | |||
Ending Balance | (934) | (1,078) | (7) | |||
Net Unrealized Investment Gains (Losses) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning Balance | (323,295) | (90,117) | (314,870) | |||
Change in OCI before reclassifications | 956,373 | (311,658) | 320,182 | |||
Amounts reclassified from AOCI | (3,123) | 62,970 | 3,177 | |||
Income tax benefit (expense) | (200,409) | 52,225 | (98,606) | |||
Ending Balance | 429,546 | (323,295) | (90,117) | |||
Total Accumulated Other Comprehensive Income (Loss) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning Balance | (324,373) | (90,124) | (314,948) | |||
Change in OCI before reclassifications | 956,555 | (313,012) | 320,291 | |||
Amounts reclassified from AOCI | (3,123) | 62,970 | 3,177 | |||
Income tax benefit (expense) | (200,447) | 52,510 | (98,644) | |||
Cumulative effect of adoption | $ 0 | $ (36,700) | ||||
Ending Balance | 428,612 | (324,373) | (90,124) | |||
ASU 2016-01 | Foreign Currency Translation Adjustment | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Cumulative effect of adoption | 0 | |||||
ASU 2016-01 | Net Unrealized Investment Gains (Losses) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Cumulative effect of adoption | (3) | |||||
ASU 2016-01 | Total Accumulated Other Comprehensive Income (Loss) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Cumulative effect of adoption | (3) | $ (3) | ||||
ASU 2018-02 | Foreign Currency Translation Adjustment | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Cumulative effect of adoption | (2) | |||||
ASU 2018-02 | Net Unrealized Investment Gains (Losses) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Cumulative effect of adoption | (36,712) | |||||
ASU 2018-02 | Total Accumulated Other Comprehensive Income (Loss) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Cumulative effect of adoption | (36,714) | |||||
Cash flow hedges | Net Unrealized Investment Gains (Losses) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning Balance | (4,000) | (26,000) | ||||
Ending Balance | $ 0 | $ (4,000) | $ (26,000) | |||
[1] | Includes the impact from the adoption of ASUs 2017-08 and 2017-12. See Note 2. |
Equity (Reclassification out of
Equity (Reclassification out of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net Unrealized Investment Gains (Losses) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Amounts reclassified from AOCI | $ (3,123) | $ 62,970 | $ 3,177 |
Total Accumulated Other Comprehensive Income (Loss) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Amounts reclassified from AOCI | (3,123) | 62,970 | 3,177 |
Reclassification out of Accumulated Other Comprehensive Income | Net Unrealized Investment Gains (Losses) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Amounts reclassified from AOCI | 3,123 | (62,970) | (3,177) |
Reclassification out of Accumulated Other Comprehensive Income | Total Accumulated Other Comprehensive Income (Loss) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Amounts reclassified from AOCI | 3,123 | (62,970) | (3,177) |
Reclassification out of Accumulated Other Comprehensive Income | Net unrealized investment gains (losses) on available-for-sale securities | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net unrealized investment gains (losses) | (3,931) | (83,731) | (1,339) |
Reclassification out of Accumulated Other Comprehensive Income | Cross Currency/Interest Rate | Cash flow hedges | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net unrealized investment gains (losses) | $ 7,054 | $ 20,761 | $ (1,838) |
Equity (OTTI Net Unrealized Inv
Equity (OTTI Net Unrealized Investment Gains (Losses) in AOCI) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | $ (324,373) | ||
Ending Balance | 428,612 | $ (324,373) | |
Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (323,295) | (90,117) | $ (314,870) |
Ending Balance | 429,546 | (323,295) | (90,117) |
OTTI | Net Unrealized Gains (Losses) on Investments | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (3,334) | 12,311 | (1,261) |
Net investment gains (losses) on investments arising during the period | 17,795 | (15,199) | 11,328 |
Reclassification adjustment for (gains) losses included in net income | (100) | (205) | 2,172 |
Reclassification adjustment for OTTI losses excluded from net income(1) | (52) | (241) | 72 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | 0 | 0 | 0 |
Ending Balance | 14,309 | (3,334) | 12,311 |
OTTI | Deferred Policy Acquisition Costs and Other Costs | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (1,119) | (1,008) | (2,133) |
Net investment gains (losses) on investments arising during the period | 0 | 0 | 0 |
Reclassification adjustment for (gains) losses included in net income | 0 | 0 | 0 |
Reclassification adjustment for OTTI losses excluded from net income(1) | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | (80) | (111) | 1,125 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | 0 | 0 | 0 |
Ending Balance | (1,199) | (1,119) | (1,008) |
OTTI | Future Policy Benefits and Other Liabilities | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (68) | (157) | (522) |
Net investment gains (losses) on investments arising during the period | 0 | 0 | 0 |
Reclassification adjustment for (gains) losses included in net income | 0 | 0 | 0 |
Reclassification adjustment for OTTI losses excluded from net income(1) | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | (51) | 89 | 365 |
Ending Balance | (119) | (68) | (157) |
OTTI | Deferred Income Tax (Liability) Benefit | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | 27 | (3,263) | 1,387 |
Net investment gains (losses) on investments arising during the period | (3,741) | 3,192 | (3,481) |
Reclassification adjustment for (gains) losses included in net income | 21 | 43 | (667) |
Reclassification adjustment for OTTI losses excluded from net income(1) | 11 | 51 | (22) |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | 17 | 23 | (352) |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | 11 | (19) | (128) |
Ending Balance | (3,654) | 27 | (3,263) |
OTTI | Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (4,494) | 7,883 | (2,529) |
Net investment gains (losses) on investments arising during the period | 14,054 | (12,007) | 7,847 |
Reclassification adjustment for (gains) losses included in net income | (79) | (162) | 1,505 |
Reclassification adjustment for OTTI losses excluded from net income(1) | (41) | (190) | 50 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | (63) | (88) | 773 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | (40) | 70 | 237 |
Ending Balance | $ 9,337 | $ (4,494) | $ 7,883 |
Equity (All Other Net Unrealize
Equity (All Other Net Unrealized Investment Gains (Losses) in AOCI) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | $ (324,373) | ||
Cumulative effect of adoption | $ 42 | ||
Ending Balance | 428,612 | (324,373) | |
Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (323,295) | (90,117) | $ (314,870) |
Ending Balance | 429,546 | (323,295) | (90,117) |
ASU 2016-01 | Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | (3) | ||
ASU 2018-02 | Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | (36,712) | ||
All Other | Accumulated Net Unrealized Investment Gain (Loss) Pre Tax [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (413,575) | (71,723) | (442,314) |
Net investment gains (losses) on investments arising during the period | 1,139,167 | (405,264) | 376,012 |
Reclassification adjustment for (gains) losses included in net income | (3,023) | 63,175 | (5,349) |
Reclassification adjustment for OTTI losses excluded from net income(1) | 52 | 241 | (72) |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | 0 | 0 | 0 |
Ending Balance | 722,621 | (413,575) | (71,723) |
All Other | Deferred Costs Policy Acquisition And Sales Inducements And Valuation Of Business Acquired, Pre Tax [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | 8,505 | (82,212) | (31,251) |
Net investment gains (losses) on investments arising during the period | 0 | 0 | 0 |
Reclassification adjustment for (gains) losses included in net income | 0 | 0 | 0 |
Reclassification adjustment for OTTI losses excluded from net income(1) | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | (163,481) | 90,717 | (50,961) |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | 0 | 0 | 0 |
Ending Balance | (154,976) | 8,505 | (82,212) |
All Other | Policyholders Account Balances Pre Tax | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | 1,113 | (16,997) | (5,664) |
Net investment gains (losses) on investments arising during the period | 0 | 0 | 0 |
Reclassification adjustment for (gains) losses included in net income | 0 | 0 | 0 |
Reclassification adjustment for OTTI losses excluded from net income(1) | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | 0 | 0 | 0 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | (36,977) | 18,110 | (11,333) |
Ending Balance | (35,864) | 1,113 | (16,997) |
All Other | Deferred Income Tax (Liability) Benefit | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | 85,156 | 72,932 | 166,888 |
Net investment gains (losses) on investments arising during the period | (239,496) | 85,105 | (115,538) |
Reclassification adjustment for (gains) losses included in net income | 636 | (13,267) | 1,644 |
Reclassification adjustment for OTTI losses excluded from net income(1) | (11) | (51) | 22 |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | 34,369 | (19,049) | 15,949 |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | 7,774 | (3,803) | 3,967 |
Ending Balance | (111,572) | 85,156 | 72,932 |
All Other | Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning Balance | (318,801) | (98,000) | (312,341) |
Net investment gains (losses) on investments arising during the period | 899,671 | (320,159) | 260,474 |
Reclassification adjustment for (gains) losses included in net income | (2,387) | 49,908 | (3,705) |
Reclassification adjustment for OTTI losses excluded from net income(1) | 41 | 190 | (50) |
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs | (129,112) | 71,668 | (35,012) |
Impact of net unrealized investment (gains) losses on future policy benefits and other liabilities | (29,203) | 14,307 | (7,366) |
Ending Balance | $ 420,209 | (318,801) | $ (98,000) |
All Other | ASU 2016-01 | Accumulated Net Unrealized Investment Gain (Loss) Pre Tax [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | (4) | ||
All Other | ASU 2016-01 | Deferred Costs Policy Acquisition And Sales Inducements And Valuation Of Business Acquired, Pre Tax [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | 0 | ||
All Other | ASU 2016-01 | Policyholders Account Balances Pre Tax | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | 0 | ||
All Other | ASU 2016-01 | Deferred Income Tax (Liability) Benefit | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | 1 | ||
All Other | ASU 2016-01 | Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | (3) | ||
All Other | ASU 2018-02 | Accumulated Net Unrealized Investment Gain (Loss) Pre Tax [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | 0 | ||
All Other | ASU 2018-02 | Deferred Costs Policy Acquisition And Sales Inducements And Valuation Of Business Acquired, Pre Tax [Member] | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | 0 | ||
All Other | ASU 2018-02 | Policyholders Account Balances Pre Tax | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | 0 | ||
All Other | ASU 2018-02 | Deferred Income Tax (Liability) Benefit | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | (36,712) | ||
All Other | ASU 2018-02 | Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses) | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Cumulative effect of adoption | $ (36,712) |
Statutory Net Income and Surp_2
Statutory Net Income and Surplus and Dividend Restrictions (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statutory Accounting Practices [Line Items] | ||||||||||||||
Statutory net income (loss) | $ (2,052) | $ (852) | $ 3,911 | |||||||||||
Statutory surplus | $ 4,748 | $ 6,396 | 4,748 | $ 6,396 | ||||||||||
Divided the Company is permitted to pay without prior approval in 2020 | 0 | $ 0 | ||||||||||||
Extra-ordinary dividend | ||||||||||||||
Statutory Accounting Practices [Line Items] | ||||||||||||||
Statutory surplus dividend paid to PAI | $ 241 | $ 245 | $ 247 | $ 245 | $ 225 | $ 250 | $ 250 | $ 300 | $ 650 | $ 200 | $ 100 | |||
PALAC | ||||||||||||||
Statutory Accounting Practices [Line Items] | ||||||||||||||
Statutory Accounting Practices Dividends And Distributions Surplus Restriction | 10.00% | 10.00% |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||||||||||||||
Policy charges and fee income | $ 2,081,046,000 | $ 2,171,278,000 | $ 2,209,579,000 | |||||||||||
Net investment income | 551,548,000 | 402,808,000 | 422,809,000 | |||||||||||
Prudential Insurance | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Stock option program plan expense | 100,000 | 100,000 | 100,000 | |||||||||||
Deferred compensation program expense | 600,000 | 500,000 | 900,000 | |||||||||||
Pension plan expense | 2,000,000 | 2,000,000 | 1,000,000 | |||||||||||
Welfare plan expense | $ 2,000,000 | 2,000,000 | 2,000,000 | |||||||||||
Defined contribution plan employer matching contribution percent | 4.00% | |||||||||||||
Defined contribution plan, cost recognized | $ 900,000 | 700,000 | 500,000 | |||||||||||
Affiliated Entity | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Corporate Expenses | 25,000,000 | 15,000,000 | 14,000,000 | |||||||||||
Accrued interest receivable related to long-term notes | $ 0 | $ 300,000 | 0 | 300,000 | ||||||||||
Revenue related to long-tern notes receivable | 100,000 | 400,000 | 700,000 | |||||||||||
Interest expense related to loans payable | 107,000,000 | 58,000,000 | 66,000,000 | |||||||||||
Affiliated Entity | PAD | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Policy charges and fee income | 97,000,000 | 122,000,000 | 109,000,000 | |||||||||||
Affiliated Entity | ASTISI and Prudential Investments | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Revenue administrative sharing agreement | 96,000,000 | 105,000,000 | 111,000,000 | |||||||||||
Affiliated Entity | PGIM | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Net investment income | 14,000,000 | 12,000,000 | 13,000,000 | |||||||||||
Prudential Financial Joint Ventures | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Other invested assets | 391,000,000 | 228,000,000 | 391,000,000 | 228,000,000 | ||||||||||
Net investment income | 17,000,000 | 1,000,000 | 9,000,000 | |||||||||||
Prudential Financial | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Line of credit facility, maximum borrowing capacity | 9,000,000,000 | 9,000,000,000 | ||||||||||||
PAI | ||||||||||||||
Related Party Transaction [Line Items] | ||||||||||||||
Contributed capital | $ 0 | $ 0 | $ 0 | |||||||||||
Return of capital | $ 241,000,000 | $ 245,000,000 | $ 247,000,000 | $ 245,000,000 | $ 225,000,000 | $ 250,000,000 | $ 250,000,000 | $ 300,000,000 | $ 650,000,000 | $ 200,000,000 | $ 100,000,000 |
Related Party Transactions (Aff
Related Party Transactions (Affiliated Notes Receivable) (Details) - Affiliated Entity - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Total long-term notes receivable - affiliated | $ 52,573 | $ 37,192 |
U.S. dollar floating rate notes | ||
Related Party Transaction [Line Items] | ||
Total long-term notes receivable - affiliated | $ 0 | 34,008 |
U.S. dollar floating rate notes | Minimum | ||
Related Party Transaction [Line Items] | ||
Interest Rates | 3.83% | |
U.S. dollar floating rate notes | Maximum | ||
Related Party Transaction [Line Items] | ||
Interest Rates | 4.25% | |
U.S. Dollar fixed rate notes | ||
Related Party Transaction [Line Items] | ||
Total long-term notes receivable - affiliated | $ 52,573 | $ 3,184 |
U.S. Dollar fixed rate notes | Minimum | ||
Related Party Transaction [Line Items] | ||
Interest Rates | 2.62% | |
U.S. Dollar fixed rate notes | Maximum | ||
Related Party Transaction [Line Items] | ||
Interest Rates | 14.85% |
Related Party Transactions (A_2
Related Party Transactions (Affiliated Asset Transfers) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | |||
Realized investment gains (losses), net of tax | $ (2,681,320) | $ 884,073 | $ (805,400) |
Prudential Insurance February 2018 Purchase | |||
Related Party Transaction [Line Items] | |||
Fair Value | 136,963 | ||
Book Value | 136,963 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Pruco Life Insurance Company of Arizona April 2018 Sale | |||
Related Party Transaction [Line Items] | |||
Fair Value | 64,313 | ||
Book Value | 64,514 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | (159) | ||
Prudential Insurance April 2018 Sale | |||
Related Party Transaction [Line Items] | |||
Fair Value | 57,747 | ||
Book Value | 43,434 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 11,308 | ||
Prudential Insurance May 2018 Sale | |||
Related Party Transaction [Line Items] | |||
Fair Value | 162,111 | ||
Book Value | 159,237 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 2,271 | ||
Passaic Fund LLC June 2018 Transfer Out | |||
Related Party Transaction [Line Items] | |||
Fair Value | 15,281 | ||
Book Value | 15,281 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Insurance July 2018 Sale | |||
Related Party Transaction [Line Items] | |||
Fair Value | 11,160 | ||
Book Value | 9,277 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 1,488 | ||
Prudential Insurance August 2018 Sale | |||
Related Party Transaction [Line Items] | |||
Fair Value | 13,414 | ||
Book Value | 13,165 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 196 | ||
Prudential Insurance December 2018 Purchase | |||
Related Party Transaction [Line Items] | |||
Fair Value | 33,256 | ||
Book Value | 33,166 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | (71) | ||
Prudential Argicultural Investors LP December 2018 Transfer Out | |||
Related Party Transaction [Line Items] | |||
Fair Value | 7,324 | ||
Book Value | 7,324 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Insurance January 2019 Sale FM | |||
Related Party Transaction [Line Items] | |||
Fair Value | 20,504 | ||
Book Value | 20,781 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | (277) | ||
Prudential Insurance Feb 2019 Sale Commercial Mortgage | |||
Related Party Transaction [Line Items] | |||
Fair Value | 97,953 | ||
Book Value | 98,506 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | (554) | ||
Prudential Insurance March 2019 Purchase FM | |||
Related Party Transaction [Line Items] | |||
Fair Value | 141,476 | ||
Book Value | 141,476 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 7,776 | ||
Prudential Insurance April 2019 Purchase Equity Securities | |||
Related Party Transaction [Line Items] | |||
Fair Value | 4,300 | ||
Book Value | 4,300 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Retirement Insurance & Annuity Co April 2019 Purchase Equity Securities | |||
Related Party Transaction [Line Items] | |||
Fair Value | 1,258 | ||
Book Value | 1,258 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudo Life Insurance Company April 2019 Purchase Equity Securities | |||
Related Party Transaction [Line Items] | |||
Fair Value | 14,525 | ||
Book Value | 14,525 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Insurance June 2019 Transfer Out Fixed Maturities | |||
Related Party Transaction [Line Items] | |||
Fair Value | 23,066 | ||
Book Value | 23,002 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 64 | ||
Prudential Insurance June 2019 Transfer In Fixed Maturities | |||
Related Party Transaction [Line Items] | |||
Fair Value | 19,919 | ||
Book Value | 19,919 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Insurance August 2019 Sale Fixed Maturities | |||
Related Party Transaction [Line Items] | |||
Fair Value | 66,346 | ||
Book Value | 64,735 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 1,611 | ||
Prudential Insurance August 2019 Sale Commercial Mortgages | |||
Related Party Transaction [Line Items] | |||
Fair Value | 106,307 | ||
Book Value | 104,733 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 1,574 | ||
Prudential Insurance November 2019 Sale Other Invested Assets | |||
Related Party Transaction [Line Items] | |||
Fair Value | 2,289 | ||
Book Value | 2,362 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | (73) | ||
Prudential Insurance November 2019 Sale Fixed Maturity | |||
Related Party Transaction [Line Items] | |||
Fair Value | 6,517 | ||
Book Value | 8,550 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | (2,033) | ||
Prudential Insurance December 2019 Purchase Fixed Maturity | |||
Related Party Transaction [Line Items] | |||
Fair Value | 5,271 | ||
Book Value | 5,271 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Insurance December 2019 Purchase Fixed Maturity | |||
Related Party Transaction [Line Items] | |||
Fair Value | 85,261 | ||
Book Value | 85,261 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | 0 | ||
Prudential Insurance December 2019 Sale Fixed Maturity | |||
Related Party Transaction [Line Items] | |||
Fair Value | 21,425 | ||
Book Value | 20,628 | ||
APIC, Net of Tax Increase/ (Decrease) | 0 | ||
Realized investment gains (losses), net of tax | $ 797 |
Related Party Transactions (Deb
Related Party Transactions (Debt Agreements) (Details) - Affiliated Entity - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 661,512 | $ 928,165 |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 46,835 |
Interest Rates | 2.80% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 18,734 |
Interest Rates | 2.80% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 37,468 | 37,468 |
Interest Rates | 3.64% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 93,671 | 93,671 |
Interest Rates | 3.64% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 103,039 | 103,039 |
Interest Rates | 3.64% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 93,671 | 93,671 |
Interest Rates | 3.47% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 93,671 | 93,671 |
Interest Rates | 4.39% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 28,102 | 28,102 |
Interest Rates | 4.39% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 37,468 | 37,468 |
Interest Rates | 3.95% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 93,671 | 93,671 |
Interest Rates | 3.95% | |
Prudential Insurance Loan Issued 4/20/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 46,835 | 46,835 |
Interest Rates | 3.95% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 30,000 |
Interest Rates | 2.08% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 50,000 |
Interest Rates | 3.49% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 25,000 |
Interest Rates | 3.49% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 26,000 | 26,000 |
Interest Rates | 2.59% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 25,000 |
Interest Rates | 2.08% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 20,000 |
Interest Rates | 2.08% | |
Prudential Insurance Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 25,000 |
Interest Rates | 3.49% | |
Prudential Retirement Insurance & Annuity Loan Issued 6/28/2016 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 0 | 34,000 |
Interest Rates | 3.09% | |
Prudential Funding Loan Issued 12/16/2019 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 1,298 | 0 |
Interest Rates | 2.02% | |
Prudential Funding Loan Issued 12/17/2019 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 1,478 | 0 |
Interest Rates | 2.02% | |
Prudential Funding Loan Issued 12/17/2019 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 502 | 0 |
Interest Rates | 2.02% | |
Prudential Funding Loan Issued 12/18/2019 | ||
Related Party Transaction [Line Items] | ||
Short-term and long-term debt | $ 4,638 | $ 0 |
Interest Rates | 2.02% |
Commitments and Contingent Li_2
Commitments and Contingent Liabilities (Narrative) (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Commitments and Contingent Liabilities [Line Items] | |||
Litigation and regulatory matters loss contingency, range of possible loss, maximum (less than) | $ 150 | ||
Commercial Mortgage Loans | Commitments | |||
Commitments and Contingent Liabilities [Line Items] | |||
Total outstanding mortgage loan commitments | 43 | $ 4 | |
Investments | Commitments | |||
Commitments and Contingent Liabilities [Line Items] | |||
Commitments to purchase investment (excluding commercial mortgage loans) | $ 207 | $ 271 | |
Settled Litigation | |||
Commitments and Contingent Liabilities [Line Items] | |||
Litigation Settlement, Amount Awarded to Other Party | $ 5 | ||
Disgorgement Ruling | |||
Commitments and Contingent Liabilities [Line Items] | |||
Litigation Settlement, Amount Awarded to Other Party | $ 27.6 |
Contract Withdrawal Provisions
Contract Withdrawal Provisions (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Surrender Charges [Line Items] | |
Surrender charge period in years (less than) | 10 years |
Maximum | |
Surrender Charges [Line Items] | |
Annuities surrender charge percentage | 9.00% |
Minimum | |
Surrender Charges [Line Items] | |
Annuities surrender charge percentage | 1.00% |
Quarterly Results of Operatio_3
Quarterly Results of Operations (Unaudited) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Data [Abstract] | |||||||||||
Total revenues | $ 864,964 | $ 272,685 | $ (103,779) | $ (582,563) | $ 988,030 | $ 826,028 | $ 769,260 | $ 1,331,262 | $ 451,307 | $ 3,914,580 | $ 2,303,936 |
Total benefits and expenses | 472,044 | 558,773 | 404,277 | 296,641 | 451,549 | 561,865 | 517,619 | 539,327 | 1,731,735 | 2,070,360 | 1,186,341 |
Income (loss) from operations before income taxes | 392,920 | (286,088) | (508,056) | (879,204) | 536,481 | 264,163 | 251,641 | 791,935 | (1,280,428) | 1,844,220 | 1,117,595 |
Net income (loss) | $ 306,979 | $ (227,512) | $ (168,770) | $ (900,024) | $ 432,255 | $ 412,236 | $ 202,546 | $ 635,679 | $ (989,327) | $ 1,682,716 | $ (83,504) |
Schedule I - Summary of Inves_2
Schedule I - Summary of Investments Other Than investments in Related Parties (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Schedule of Investments [Line Items] | ||
Amortized Cost | $ 12,465,746 | $ 10,186,465 |
Fair Value | 13,202,365 | 9,771,673 |
Equity securities, at cost | 63,647 | 18,765 |
Equity securities, at fair value | 67,503 | 20,613 |
Fixed Maturities, Trading, Amortized Cost | 349,428 | 294,549 |
Fixed maturities, trading, at fair value | 383,198 | 289,752 |
Commercial mortgage and other loans | 1,471,522 | 1,353,478 |
Policy loans | 12,366 | 12,805 |
Short-term investments | 335,358 | 37,568 |
Other invested assets | 474,013 | 348,541 |
Total Investment at Cost | 15,172,080 | |
Total investment per Balance Sheet | 15,946,325 | 11,834,430 |
Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 12,465,746 | 10,186,465 |
Fair Value | 13,202,365 | 9,771,673 |
Equity securities | ||
Schedule of Investments [Line Items] | ||
Equity securities, at cost | 63,647 | |
Equity securities, at fair value | 67,503 | |
Available-for-sale | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 12,465,746 | |
Fair Value | 13,202,365 | |
Trading | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Fixed Maturities, Trading, Amortized Cost | 349,428 | |
Fixed maturities, trading, at fair value | 383,198 | |
U.S. Treasury securities and obligations of U.S. government authorities and agencies | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 6,667,347 | 5,240,519 |
Fair Value | 7,119,824 | 4,884,091 |
Obligations of U.S. states and their political subdivisions | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 252,304 | 133,670 |
Fair Value | 259,682 | 131,164 |
Foreign government bonds | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 203,386 | 199,044 |
Fair Value | 222,884 | 199,636 |
Asset-backed securities | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 443,767 | 505,862 |
Fair Value | 444,438 | 505,244 |
Residential mortgage-backed securities | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 73,814 | 48,622 |
Fair Value | 77,761 | 49,414 |
Commercial mortgage-backed securities | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 557,584 | 364,601 |
Fair Value | 578,289 | $ 361,880 |
Public utilities | Available-for-sale | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 527,829 | |
Fair Value | 563,139 | |
All other corporate bonds | Available-for-sale | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 3,710,374 | |
Fair Value | 3,905,082 | |
Redeemable preferred stock | Available-for-sale | Fixed maturities | ||
Schedule of Investments [Line Items] | ||
Amortized Cost | 29,341 | |
Fair Value | 31,266 | |
Other common stock | Equity securities | ||
Schedule of Investments [Line Items] | ||
Equity securities, at cost | 10,526 | |
Equity securities, at fair value | 11,387 | |
Mutual funds | Equity securities | ||
Schedule of Investments [Line Items] | ||
Equity securities, at cost | 49,699 | |
Equity securities, at fair value | 52,256 | |
Perpetual preferred stocks | Equity securities | ||
Schedule of Investments [Line Items] | ||
Equity securities, at cost | 3,422 | |
Equity securities, at fair value | $ 3,860 |
Uncategorized Items - palacform
Label | Element | Value | |
Parent [Member] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (371,000) | [1] |
Accounting Standards Update 2016-01 [Member] | Parent [Member] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 334,000 | |
Accounting Standard Update 2018-02 [Member] | Parent [Member] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 | |
Accounting Standard Update 2018-02 [Member] | Retained Earnings [Member] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 36,714,000 | |
Accounting Standard Update 2018-02 [Member] | AOCI Attributable to Parent [Member] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (36,714,000) | |
[1] | Includes the impact from the adoption of ASUs 2017-08 and 2017-12. See Note 2. |