Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | May 12, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 033-44202 | |
Entity Registrant Name | Fortitude Life Insurance & Annuity Co | |
Entity Incorporation, State or Country Code | AZ | |
Entity Tax Identification Number | 06-1241288 | |
Entity Address, Address Line One | Ten Exchange Place | |
Entity Address, Address Line Two | Suite 2210 | |
Entity Address, City or Town | Jersey City | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07302 | |
City Area Code | (615) | |
Local Phone Number | 981-8801 | |
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 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0000881453 | |
Current Fiscal Year End Date | --12-31 |
INTERIM CONSOLIDATED STATEMENTS
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Fixed maturity securities, at fair value | $ 5,239,000,000 | $ 5,024,000,000 |
Equity securities, at fair value (cost - March 31, 2023 - $201; December 31, 2022 - $201) | 182,000,000 | 175,000,000 |
Mortgage and other loans, at fair value | 206,000,000 | 196,000,000 |
Short-term investments | 62,000,000 | 42,000,000 |
Other invested assets (includes $427 and $430 of assets measured at fair value at March 31, 2023 and December 31, 2022, respectively) | 446,000,000 | 450,000,000 |
Total investments | 6,135,000,000 | 5,887,000,000 |
Cash and cash equivalents | 845,000,000 | 872,000,000 |
Accrued investment income | 53,000,000 | 52,000,000 |
Reinsurance recoverables, at fair value | 247,000,000 | 235,000,000 |
Net modified coinsurance receivable | 0 | 18,000,000 |
Deposit asset | 608,000,000 | 607,000,000 |
Goodwill | 93,000,000 | 93,000,000 |
Income tax | 45,000,000 | 50,000,000 |
Other assets (Receivables from parent and affiliates: March 31, 2023 - $0; December 31, 2022 - $40) | 98,000,000 | 127,000,000 |
Separate account assets, at fair value | 23,985,000,000 | 23,601,000,000 |
Total assets | 32,109,000,000 | 31,542,000,000 |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751,000,000 | 5,546,000,000 |
Net modified coinsurance payable | 45,000,000 | 0 |
Other liabilities (Payables to parent and affiliates: March 31, 2023 - $54; December 31, 2022 - $3) | 762,000,000 | 808,000,000 |
Separate account liabilities, at fair value | 23,985,000,000 | 23,601,000,000 |
Total liabilities | 30,543,000,000 | 29,955,000,000 |
COMMITMENTS AND CONTINGENT LIABILITIES (See Note 9) | ||
EQUITY | ||
Common stock, $100 par value; 25,000 shares authorized, issued and outstanding | 3,000,000 | 3,000,000 |
Additional paid-in capital | 1,714,000,000 | 1,759,000,000 |
Retained deficit | (279,000,000) | (286,000,000) |
Accumulated other comprehensive income | 128,000,000 | 111,000,000 |
Total equity | 1,566,000,000 | 1,587,000,000 |
TOTAL LIABILITIES AND EQUITY | $ 32,109,000,000 | $ 31,542,000,000 |
INTERIM CONSOLIDATED STATEMEN_2
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Equity securities, cost | $ 201 | $ 201 |
Other invested assets, fair value | 427 | 430 |
Due from parent and affiliates | 0 | 40 |
Payables to parent and affiliates | $ 54 | $ 3 |
Common stock, par value (in dollars per share) | $ 100 | $ 100 |
Common stock authorized (in shares) | 25,000 | 25,000 |
Common stock issued (in shares) | 25,000 | 25,000 |
Common stock outstanding (in shares) | 25,000 | 25,000 |
UNAUDITED INTERIM CONSOLIDATED
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Sep. 30, 2022 | |
REVENUES | ||
Premiums | $ 7 | $ 8 |
Policy charges and fee income | 117 | 97 |
Net investment income | 76 | 99 |
Asset management and service fees | 22 | 20 |
Other income (loss) | 1 | (19) |
Investment gains, net | 165 | 481 |
TOTAL REVENUES | 388 | 686 |
BENEFITS AND EXPENSES | ||
Policyholder benefits and changes in fair value of insurance liabilities | 340 | |
Policyholder benefits | 26 | |
Interest credited to policyholders’ account balances | 0 | 85 |
Amortization of deferred policy acquisition costs | 0 | 104 |
Commission expense | 23 | 35 |
General, administrative and other expenses | 18 | 3 |
TOTAL BENEFITS AND EXPENSES | 381 | 253 |
INCOME FROM OPERATIONS BEFORE INCOME TAXES | 7 | 433 |
Income tax expense | 0.3 | 77 |
NET INCOME | 7 | 356 |
Other comprehensive income (loss), before tax: | ||
Changes in own-credit risk related to insurance liabilities | 22 | 0 |
Net unrealized investment losses | 0 | (561) |
Total | 22 | (561) |
Less: Income tax expense (benefit) related to other comprehensive income (loss) | 5 | (118) |
Other comprehensive income (loss), net of taxes | 17 | (443) |
COMPREHENSIVE INCOME (LOSS) | $ 24 | $ (87) |
UNAUDITED INTERIM CONSOLIDATE_2
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Deficit | Accumulated Other Comprehensive Income |
Beginning Balance at Dec. 31, 2021 | $ 1,682 | $ 3 | $ 592 | $ 917 | $ 170 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Return of capital | (306) | (306) | |||
Comprehensive income (loss): | |||||
Net income | 356 | 356 | |||
Other comprehensive income (loss), net of taxes | (443) | (443) | |||
Total comprehensive income (loss) | (87) | ||||
Ending Balance at Mar. 31, 2022 | 1,289 | 3 | 286 | 1,273 | (273) |
Beginning Balance at Dec. 31, 2022 | 1,587 | 3 | 1,759 | (286) | 111 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Distribution payable to parent | (45) | (45) | |||
Comprehensive income (loss): | |||||
Net income | 7 | 7 | |||
Other comprehensive income (loss), net of taxes | 17 | 17 | |||
Total comprehensive income (loss) | 24 | ||||
Ending Balance at Mar. 31, 2023 | $ 1,566 | $ 3 | $ 1,714 | $ (279) | $ 128 |
UNAUDITED INTERIM CONSOLIDATE_3
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 7 | $ 356 |
Adjustments to reconcile net income to net cash from (used in) operating activities: | ||
Investment gains, net | (165) | (481) |
Interest credited to policyholders’ account balances | 0 | 85 |
Other, net | (10) | 2 |
Change in: | ||
Insurance liabilities, at fair value | 277 | 0 |
Deposit asset, at fair value | (1) | 0 |
Net modified coinsurance receivable/payable, at fair value | 55 | 0 |
Future policy benefits | 0 | 60 |
Accrued investment income | (1) | 1 |
Net receivables from/payables to parent and affiliates | 0 | (37) |
Deferred policy acquisition costs | 0 | 104 |
Income taxes | 0 | 142 |
Reinsurance recoverables, net | (12) | (39) |
Derivatives, net | (91) | (1,079) |
Other, net | 35 | (3) |
Cash flows from (used in) operating activities | 94 | (889) |
Proceeds from the sale/maturity/prepayment of: | ||
Fixed maturity securities, at fair value | 149 | 0 |
Fixed maturity securities, available-for-sale | 0 | 422 |
Equity securities | 0 | 95 |
Mortgage and other loans | 18 | 39 |
Other invested assets | 6 | 1 |
Short-term investments | 36 | 795 |
Payments for the purchase/origination of: | ||
Fixed maturity securities, at fair value | (261) | 0 |
Fixed maturity securities, available-for-sale | 0 | (751) |
Mortgage and other loans | (28) | (13) |
Other invested assets | (9) | 0 |
Short-term investments | (41) | (94) |
Derivatives, net | 0 | 3 |
Other, net | (1) | 0 |
Cash flows from (used in) investing activities | (131) | 497 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net policyholder's account deposits (withdrawals) | (49) | 62 |
Cash collateral for loaned securities | 58 | 205 |
Drafts outstanding | 1 | (7) |
Distribution to parent | 0 | (306) |
Cash flows from (used in) financing activities | 10 | (46) |
NET DECREASE IN CASH AND CASH EQUIVALENTS | (27) | (438) |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 872 | 2,016 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | $ 845 | $ 1,578 |
BUSINESS AND BASIS OF PRESENTAT
BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS AND BASIS OF PRESENTATION | BUSINESS AND BASIS OF PRESENTATION Fortitude Life Insurance & Annuity Company and its wholly-owned subsidiary (collectively, “FLIAC” or the “Company”), with its principal offices in Jersey City, New Jersey, is a wholly-owned subsidiary of Fortitude Group Holdings, LLC (“FGH”). Prior to April 1, 2022, the Company (previously named Prudential Annuities Life Assurance Corporation ("PALAC")) was a wholly-owned subsidiary of Prudential Annuities, Inc ("PAI"), an indirect wholly-owned subsidiary of Prudential Financial, Inc. ("Prudential Financial"), a New Jersey Corporation. On April 1, 2022, PAI completed the sale of its equity interest in the Company to FGH. As a result, the Company is no longer an affiliate of Prudential Financial or any of its affiliates. See Basis of Presentation below and Note 1 in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for further information regarding the acquisition. Basis of Presentation The Unaudited Interim Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). The accompanying Unaudited Consolidated Financial Statements present the consolidated results of operations, financial condition, and cash flows of the Successor Company and a variable interest entity ("VIE") that meets the requirements for consolidation. All intercompany transactions have been eliminated in consolidation. The financial statements of the Predecessor Company were not consolidated as it was a single entity prior to acquisition. Following the acquisition of FLIAC, purchase accounting was applied to FGH's financial statements and we have elected to "push down" the basis to FLIAC in accordance with Accounting Standards Codification ("ASC") 805, Business Combinations . The application of push-down accounting created a new basis of accounting for all assets and liabilities based on fair value at the date of acquisition. As a result, FLIAC's financial position, results of operations, and cash flows subsequent to the acquisition are not comparable with those prior to April 1, 2022, and therefore have been segregated to indicate pre-acquisition and post-acquisition periods. The pre-acquisition period through March 31, 2022 is referred to as the Predecessor Company. The post-acquisition period, April 1, 2022 and forward, includes the impact of push-down accounting and is referred to as the Successor Company. See Notes 1 and 2 in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for further information regarding the acquisition and our application of push-down accounting. In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. 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. Novation of Ceded Business In 2022, in accordance with applicable state law, a program was instituted to novate a significant portion of the Ceded Business policies from FLIAC to Pruco Life Insurance Company ("Pruco Life"). The program does not have an impact on net equity or net income but has resulted in the reduction of certain activity/balances associated with these policies. During the three months ended March 31, 2023, approximately $7 million of account value, which generally approximates fair values of insurance liabilities, was transferred out of the Company as a result of the novation program. Approximately 66 percent of account value in the Ceded Business has been novated since the acquisition of the Company on April 1, 2022. Reclassifications |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS | SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS Accounting Policy Election Fair Value Option We have elected to prospectively apply the fair value option to several of FLIAC's assets and liabilities. We have made this election as it improves our operational efficiency and better aligns the recognition and measurement of our investments, insurance liabilities, and associated reinsurance activity with how we expect to manage the business. See Note 6 herein and Notes 2 and 6 in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for further information. Recent Accounting Pronouncements Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of an Accounting Standards Update ("ASU") to the ASC. We consider 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 the date of this filing. ASUs not listed below were assessed and determined to be either not applicable or not material. Effective ASUs - March 31, 2023 ASU 2018-12, Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts , was issued by the FASB. This update became effective January 1, 2023 but is not applicable due to our election to adopt the fair value option on all of our insurance liabilities, which includes our separate account liabilities. ASU 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt restructurings and Vintage Disclosures, was issued by the FASB . This update became effective January 1, 2023 but is not applicable due to our election to adopt the fair value option on financial instruments that are within the scope of this update. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION FLIAC has two reportable segments, which we refer to as the "Retained Business" and the "Ceded Business." The Retained Business consists of variable annuity products with guaranteed lifetime withdrawal benefit features as well as smaller blocks of variable annuity products with certain other living benefit and death benefit features. The Retained Business also includes variable universal life and fixed payout annuity products. The Retained Business is actively managed by FLIAC management and the Successor Company retains the full economic benefits and risks. The Ceded Business represents certain business (primarily registered index-linked annuities and fixed annuities, which includes fixed indexed and fixed deferred annuities, and other variable annuities) where 100 percent of the assets and liabilities have been fully ceded to Prudential Insurance and Pruco Life under existing coinsurance and modified coinsurance agreements. At March 31, 2023 and December 31, 2022, we had a modified coinsurance payable of $1,886 million and $1,745 million, respectively, equal to the assets held in the Ceded Business, which is included in the net modified coinsurance receivable/payable. Historical information has not been revised for the segment presentation and is not comparable following the election of push-down accounting as of April 1, 2022. The following is the Consolidated Statement of Financial Position by segment: March 31, 2023 Retained Business Ceded Business Total (in millions) ASSETS Total investments $ 4,457 $ 1,678 $ 6,135 Cash and cash equivalents 389 456 845 Accrued investment income 42 11 53 Reinsurance recoverables — 247 247 Deposit asset — 608 608 Goodwill 93 — 93 Income tax 45 — 45 Other assets 70 28 98 Separate account assets 21,909 2,076 23,985 TOTAL ASSETS $ 27,005 $ 5,104 $ 32,109 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities $ 3,056 $ 2,695 $ 5,751 Net modified coinsurance payable — 45 45 Other liabilities 474 288 762 Separate account liabilities 21,909 2,076 23,985 TOTAL LIABILITIES 25,439 5,104 30,543 EQUITY 1,566 — 1,566 TOTAL LIABILITIES AND EQUITY $ 27,005 $ 5,104 $ 32,109 December 31, 2022 Retained Business Ceded Business Total (in millions) ASSETS Total investments $ 4,257 $ 1,630 $ 5,887 Cash and cash equivalents 433 439 872 Accrued investment income 41 11 52 Reinsurance recoverables — 235 235 Net modified coinsurance receivable — 18 18 Deposit asset — 607 607 Goodwill 93 — 93 Income tax 50 — 50 Other assets 113 14 127 Separate account assets 21,558 2,043 23,601 TOTAL ASSETS $ 26,545 $ 4,997 $ 31,542 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities $ 2,941 $ 2,605 $ 5,546 Other liabilities 459 349 808 Separate account liabilities 21,558 2,043 23,601 TOTAL LIABILITIES 24,958 4,997 29,955 EQUITY 1,587 — 1,587 TOTAL LIABILITIES AND EQUITY $ 26,545 $ 4,997 $ 31,542 The following is comprehensive income by segment: Three Months Ended March 31, 2023 Retained Business Ceded Business Total (in millions) REVENUES Premiums $ 7 $ — $ 7 Policy charges and fee income 117 — 117 Net investment income 56 20 76 Asset management and service fees 22 — 22 Other income 1 — 1 Investment gains, net 30 135 165 TOTAL REVENUES 233 155 388 BENEFITS AND EXPENSES Policyholder benefits and changes in fair value of insurance liabilities 185 155 340 Commission expense 23 — 23 General, administrative and other expenses 18 — 18 TOTAL BENEFITS AND EXPENSES 226 155 381 INCOME FROM OPERATIONS BEFORE INCOME TAXES 7 — 7 Income tax expense — — — NET INCOME $ 7 $ — $ 7 Other comprehensive income, before tax: Changes in own-credit risk related to insurance liabilities 22 22 Less: Income tax expense 5 5 Other comprehensive income, net of taxes 17 — 17 COMPREHENSIVE INCOME $ 24 $ — $ 24 |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | INVESTMENTS We have elected to apply the fair value option for FLIAC's entire portfolio of fixed maturity and equity securities and mortgage and other loans. The impact of the election has resulted in the following changes: • Elimination of the "available-for-sale" designation on all fixed maturity securities, resulting in a change in the recording of unrealized gains and losses through "Investment gains, net" in the consolidated statement of income rather than in "Accumulated other comprehensive income" ("AOCI") as a component of equity in the consolidated statements of financial position; • Elimination of the required allowance for current expected credit losses on applicable financial assets under ASC 326 - Financial Instruments - Credit Losses , which include fixed maturity securities designated as "available-for-sale" and mortgage and other loans; and • Elimination of a significant portion of the required disclosures for available-for-sale securities and mortgage and other loans. These disclosures primarily relate to the amortized cost and unrealized gains and losses on available-for-sale securities. Disclosures for historical periods under the Predecessor Company are retained at the end of this note under "Predecessor Company". SUCCESSOR COMPANY Other Invested Assets The following table sets forth the composition of “Other invested assets,” as of the dates indicated. March 31, 2023 December 31, 2022 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) LPs/LLCs: Equity method: Private equity $ — $ 3 $ 3 $ — $ 4 $ 4 Real estate-related — 5 5 — 5 5 Subtotal equity method — 8 8 — 9 9 Fair value: Private equity 352 1 353 344 1 345 Total LPs/LLCs 352 9 361 344 10 354 Derivative instruments 74 — 74 85 — 85 Policy loans 11 — 11 11 — 11 Total other invested assets $ 437 $ 9 $ 446 $ 440 $ 10 $ 450 Accrued Investment Income The following table sets forth the composition of “Accrued investment income,” as of the dates indicated: March 31, 2023 December 31, 2022 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Fixed maturity securities $ 40 $ 9 $ 49 $ 37 $ 10 $ 47 Mortgage and other loans 1 — 1 1 — 1 Short-term investments and cash equivalents 1 2 3 3 1 4 Total accrued investment income $ 42 $ 11 $ 53 $ 41 $ 11 $ 52 There were no write-downs on accrued investment income for the three months ended March 31, 2023. Net Investment Income The following table sets forth “Net investment income” by investment type, for the periods indicated: Three Months Ended March 31, 2023 Retained Business Ceded Business Total (in millions) Fixed maturities securities $ 47 $ 14 $ 61 Equity securities — 1 1 Mortgage and other loans 4 — 4 Other invested assets 12 1 13 Short-term investments and cash equivalents 2 6 8 Gross investment income 65 22 87 Less: investment expenses (9) (2) (11) Net investment income $ 56 $ 20 $ 76 The activity above includes interest income related to fair value option investments, where applicable. Investment Gains, Net The following table sets forth “Investment gains, net” by investment type, for the periods indicated: Three Months Ended March 31, 2023 Retained Business Ceded Business Total Business Unrealized Realized Total Unrealized Realized Total Unrealized Realized Total (in millions) Fixed maturity securities $ 156 $ (26) $ 130 $ 21 $ — $ 21 $ 177 $ (26) $ 151 Equity securities — — — 7 — 7 7 — 7 Derivatives — (100) (100) — 107 107 — 7 7 Total $ 156 $ (126) $ 30 $ 28 $ 107 $ 135 $ 184 $ (19) $ 165 Repurchase Agreements and Securities Lending In the normal course of business, FLIAC sells securities under agreements to repurchase and enters into securities lending transactions. These balances are recorded within Other liabilities in the unaudited interim consolidated statements of financial position. The following table sets forth, by type, the securities that we have agreed to repurchase, all of which are contained in the Retained Business. The below amounts represent the cash received under the outstanding repurchase agreements. March 31, 2023 December 31, 2022 Remaining Contractual Maturities of the Agreements Overnight & Continuous Up to 30 days 30-90 days Total Overnight & Continuous Up to 30 days 30-90 days Total (in millions) U.S. corporate public securities $ — $ 200 $ 101 $ 301 $ — $ 111 $ 200 $ 311 The market value of the securities posted as collateral under the repurchase agreements was $318 million and $326 million as of March 31, 2023 and December 31, 2022, respectively. The following table sets forth the remaining contractual maturities of the Successor Company's securities lending transactions by the security type that was loaned, all of which are contained in the Ceded Business. The amounts below represent the cash collateral received for the loaned securities. March 31, 2023 December 31, 2022 Remaining Contractual Maturities of the Agreements Overnight & Continuous Up to 30 days 30-90 days Total Overnight & Continuous Up to 30 days 30-90 days Total (in millions) Equity securities $ 164 $ — $ — $ 164 $ 106 $ — $ — $ 106 The market value of the securities loaned was $162 million and $103 million as of March 31, 2023 and December 31, 2022, respectively. PREDECESSOR COMPANY The following table sets forth the sources of proceeds and related investment losses for available-for-sale fixed maturity securities: Three months ended March 31 2022 (in millions) Fixed maturities, available-for-sale: Proceeds from sales(1) $ 294 Proceeds from maturities/prepayments 108 Gross investment losses on sales and maturities (21) (1) Excludes activity from non-cash related proceeds due to the timing of trade settlements of $20 million for three months ended March 31, 2022. Allowance for credit losses The activity in the allowance for credit losses for fixed maturity securities, available-for-sale, was de minimis for the three months ended March 31, 2022. The allowance for credit losses for mortgage and other loans declined by $1 million for the three months ended March 31, 2022. The decrease related to the improving credit environment. See Note 2 to the Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 for additional information about the Predecessor Company’s methodology for developing the allowance for credit losses. Net Investment Income The following table sets forth “Net investment income” by investment type, for the periods indicated: Three Months Ended March 31, 2022 (in millions) Fixed maturities securities (1) $ 61 Equity securities 1 Mortgage and other loans 11 Other invested assets 29 Short-term investments and cash equivalents 1 Gross investment income 103 Less: investment expenses (4) Net investment income $ 99 (1) Includes fixed maturity securities classified as available-for-sale and trading. Investment Gains, Net The following table sets forth “Investment gains, net” by investment type, for the periods indicated: Three Months Ended March 31, 2022 (in millions) Fixed maturity securities (1) $ (21) Derivatives 502 Total $ 481 (1) Includes fixed maturity securities classified as available-for-sale and excludes fixed maturity securities classified as trading. |
DERIVATIVES AND HEDGING
DERIVATIVES AND HEDGING | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND HEDGING | DERIVATIVES AND HEDGING Types of Derivative Instruments and Derivative Strategies The Company utilizes various derivative instruments and strategies to manage its risk. Commonly used derivative instruments include but are not necessarily limited to: • Interest rate contracts: futures, swaps, forwards, options, caps and floors • Equity contracts: futures, options and total return swaps • Foreign exchange contracts: futures, options, forwards and swaps • Credit contracts: single and index reference credit default swaps See below for information on these contracts and the related strategies. Interest Rate Contracts Interest rate swaps 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. 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 Secured Overnight Financing Rate ("SOFR") 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 purchases credit protection using credit derivatives in order to hedge specific credit exposures in the Company’s investment portfolio. The Company also sells credit protection using credit derivatives in order to generate a credit spread for the benefit of the Company’s investment portfolio. Primary Risks Managed by Derivatives The tables below provide a summary, by operating segment, of the gross notional amount and fair value of derivative contracts, by the primary underlying risks. 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. March 31, 2023 December 31, 2022 Primary Underlying Risk/Instrument Type Gross Fair Value Gross Fair Value Assets Liabilities Assets Liabilities (in millions) Retained Business Interest Rate Interest Rate Swaps $ 16,005 $ 237 $ (409) $ 12,131 $ 228 $ (553) Currency/Interest Rate Foreign Currency Swaps 102 11 — 100 11 — Credit Credit Default Swaps 520 7 — 520 5 — Equity Equity Futures (2,086) — (111) (1,737) 46 — Total Return Swaps 366 16 (14) — 24 (49) Equity Options 2,949 76 — 3,286 118 — Total Derivatives, Retained Business 17,856 347 (534) 14,300 432 (602) Ceded Business Interest Rate Interest Rate Swaps 1,300 40 (41) 2,517 48 (117) Currency/Interest Rate Foreign Currency Swaps 48 6 — 48 6 — Credit Credit Default Swaps 71 1 — 71 1 — Equity Total Return Swaps 22 — — — — — Equity Options 5,357 147 (207) 7,139 180 (356) Total Derivatives, Ceded Business 6,798 194 (248) 9,775 235 (473) Total Derivatives (1) $ 24,654 $ 541 $ (782) $ 24,075 $ 667 $ (1,075) (1) Recorded in “Other invested assets” and “Other liabilities” in the Consolidated Statements of Financial Position. Offsetting Assets and Liabilities The following table presents recognized derivative instruments that are offset in the Consolidated 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 Consolidated Statements of Financial Position. March 31, 2023 Gross Gross Amounts Net Financial Net (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 78 $ (4) $ 74 $ (74) $ — Ceded Business 194 (194) — — — Total $ 272 $ (198) $ 74 $ (74) $ — Offsetting of Financial Liabilities: Derivatives Retained Business $ 265 $ (265) $ — $ — $ — Ceded Business 248 (194) 54 — 54 Total $ 513 $ (459) $ 54 $ — $ 54 Repurchase agreements $ 301 $ — $ 301 $ (301) $ — Securities lending transactions $ 164 $ — $ 164 $ (162) $ 2 December 31, 2022 Gross Gross Amounts Net Amounts Presented in the Statement of Financial Position Financial Net (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 183 $ (98) $ 85 $ (85) $ — Ceded Business 235 (235) — — — Total $ 418 $ (333) $ 85 $ (85) $ — Offsetting of Financial Liabilities: Derivatives Retained Business $ 353 $ (353) $ — $ — $ — Ceded Business 473 (272) 201 — 201 Total $ 826 $ (625) $ 201 $ — $ 201 Repurchase agreements 311 — 311 (311) — Securities lending transactions 106 — 106 (103) 3 (1) Amounts exclude the excess of collateral received/pledged from/to the counterparty. The Company is exposed to credit-related losses in the event of non-performance by counterparties to financial derivative transactions with a positive fair value. FLIAC manages 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. Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. 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 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Classification of Derivatives Activity As part of our application of push-down accounting in connection with the acquisition of the Company, we have de-designated the Predecessor Company's hedging relationships for all of our derivative instruments, and accordingly, any related accumulated unrealized gains and losses that were previously recorded in AOCI were reset to zero at the acquisition date. Historical information has not been restated under the updated segmentation and is not comparable following the change in ownership on April 1, 2022. The following tables provide the financial statement classification and impact of derivatives, by segment. Successor Company Three Months Ended March 31, 2023 Investment gains, net (in millions) Retained Business Interest Rate $ 115 Equity (215) Total, Retained Business (100) Ceded Business Interest Rate 31 Equity 76 Total, Ceded Business 107 Total $ 7 Predecessor Company Three Months Ended March 31, 2022 Investment Net Investment Other Income Change in AOCI (in millions) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ 1 $ 1 $ 2 $ 4 Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate (527) — — — Currency/Interest Rate (6) — — — Credit (12) — — — Equity 59 — — — Embedded Derivatives 986 — — — Total Derivatives Not Qualifying as Hedge Accounting Instruments 500 — — — Total $ 501 $ 1 $ 2 $ 4 |
FAIR VALUE OF ASSETS AND LIABIL
FAIR VALUE OF ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 2023 | |
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. 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. 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. For a discussion of the Company's valuation methodologies for assets and liabilities measured at fair value and the fair value hierarchy, see Note 6 to the Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022. Fair Value Option Election We have elected to adopt the fair value option for several of our financial assets and liabilities. The following are the financial assets and liabilities for which we have elected the fair value option. See Notes 2 and 6 to the Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for further information. • Fixed maturity securities • Equity securities • Mortgage and other loans • Reinsurance recoverable • Separate account assets and liabilities • Net modified coinsurance receivable/payable • Deposit asset • Insurance liabilities 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. Successor Company March 31, 2023 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Total Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 587 $ — $ — $ 587 Obligations of U.S. states and their political subdivisions — 175 — — 175 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 2,903 — — 2,903 U.S. corporate private securities — 147 182 — 329 Foreign corporate public securities — 217 — — 217 Foreign corporate private securities — 33 36 — 69 Asset-backed securities(2) — 478 191 — 669 Commercial mortgage-backed securities — 42 — — 42 Residential mortgage-backed securities — 243 — — 243 Total fixed maturity securities — 4,830 409 — 5,239 Equity securities 182 — — — 182 Mortgage and other loans (3) — — 206 — 206 Short-term investments — 62 — — 62 Cash and cash equivalents 845 — — — 845 Other invested assets(4) — 272 — (198) 74 Deposit asset — — 608 — 608 Reinsurance recoverables — — 247 — 247 Subtotal excluding separate account assets 1,027 5,164 1,470 (198) 7,463 Separate account assets — 23,985 — — 23,985 Total assets $ 1,027 $ 29,149 $ 1,470 $ (198) $ 31,448 Liabilities Insurance liabilities $ — $ — $ 5,751 $ — $ 5,751 Other liabilities - derivatives — 513 — (459) 54 Net modified coinsurance payable — — 45 — 45 Separate account liabilities — 23,985 — — 23,985 Total liabilities $ — $ 24,498 $ 5,796 $ (459) $ 29,835 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of March 31, 2023, the difference between the aggregate fair value and the aggregate unpaid principal of mortgage and other loans was de minimis. There were no mortgage and other loans that were 90 days or more past due or in non-accrual status. (4) Other invested assets within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At March 31, 2023 the fair values of such investments were $353 million. See Note 4 for further details. Successor Company March 31, 2023 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Retained Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 513 $ — $ — $ 513 Obligations of U.S. states and their political subdivisions — 145 — — 145 U.S. corporate public securities — 2,090 — — 2,090 U.S. corporate private securities — — 182 — 182 Foreign corporate public securities — 127 — — 127 Foreign corporate private securities — — 36 — 36 Asset-backed securities(2) — 459 191 — 650 Commercial mortgage-backed securities — 42 — — 42 Residential mortgage-backed securities — 29 — — 29 Total fixed maturity securities — 3,405 409 — 3,814 Mortgage and other loans — — 206 — 206 Short-term investments — — — — — Cash and cash equivalents 389 — — — 389 Other invested assets(3) — 78 — (4) 74 Subtotal excluding separate account assets 389 3,483 615 (4) 4,483 Separate account assets — 21,909 — — 21,909 Total assets $ 389 $ 25,392 $ 615 $ (4) $ 26,392 Liabilities Insurance liabilities $ — $ — $ 3,056 $ — $ 3,056 Other liabilities - derivatives — 265 — (265) — Separate account liabilities — 21,909 — — 21,909 Total liabilities $ — $ 22,174 $ 3,056 $ (265) $ 24,965 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At March 31, 2023 the fair values of such investments were $352 million. See Note 4 for further details. Successor Company March 31, 2023 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Ceded Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 74 $ — $ — $ 74 Obligations of U.S. states and their political subdivisions — 30 — — 30 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 813 — — 813 U.S. corporate private securities — 147 — — 147 Foreign corporate public securities — 90 — — 90 Foreign corporate private securities — 33 — — 33 Asset-backed securities(2) — 19 — — 19 Residential mortgage-backed securities — 214 — — 214 Total fixed maturity securities — 1,425 — — 1,425 Equity securities 182 — — — 182 Short-term investments — 62 — — 62 Cash and cash equivalents 456 — — — 456 Other invested assets(3) — 194 — (194) — Deposit asset — — 608 — 608 Reinsurance recoverables — — 247 — 247 Subtotal excluding separate account assets 638 1,681 855 (194) 2,980 Separate account assets — 2,076 — — 2,076 Total assets $ 638 $ 3,757 $ 855 $ (194) $ 5,056 Liabilities Insurance liabilities $ — $ — $ 2,695 $ — $ 2,695 Other liabilities - derivatives — 248 — (194) 54 Net modified coinsurance payable — — 45 — 45 Separate account liabilities — 2,076 — — 2,076 Total liabilities $ — $ 2,324 $ 2,740 $ (194) $ 4,870 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At March 31, 2023 the fair values of such investments were $1 million. See Note 4 for further details. Successor Company December 31, 2022 Level 1 Level 2 Level 3 Netting(1) Total (in millions) Total Business Assets Fixed Maturity Securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 696 $ — $ — $ 696 Obligations of U.S. states and their political subdivisions — 166 — — 166 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 2,796 — — 2,796 U.S. corporate private securities — 144 146 — 290 Foreign corporate public securities — 211 — — 211 Foreign corporate private securities — 31 36 — 67 Asset-backed securities(2) — 377 155 — 532 Commercial mortgage-backed securities — 43 — — 43 Residential mortgage-backed securities — 218 — — 218 Total Fixed Maturity Securities — 4,687 337 — 5,024 Equity securities 175 — — 175 Mortgage and other loans (3) — — 196 — 196 Short-term investments — 42 — — 42 Cash and cash equivalents 872 — — — 872 Other invested assets(4) 46 621 — (582) 85 Deposit asset — — 607 — 607 Reinsurance recoverables — — 235 — 235 Net modified coinsurance receivable — — 18 — 18 Subtotal excluding separate account assets 1,093 5,350 1,393 (582) 7,254 Separate account assets — 23,601 — — 23,601 Total assets $ 1,093 $ 28,951 $ 1,393 $ (582) $ 30,855 Liabilities Insurance liabilities — — 5,546 — 5,546 Other liabilities - derivatives — 1,076 — (875) 201 Separate account liabilities — 23,601 — — 23,601 Total liabilities $ — $ 24,677 $ 5,546 $ (875) $ 29,348 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2022, the difference between the aggregate fair value and the aggregate unpaid principal of mortgage and other loans was de minimis. There were no mortgage and other loans that were 90 days or more past due or in non-accrual status. (4) Other invested assets within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At December 31, 2022 the fair values of such investments were $345 million, respectively. See Note 4 for further details. Successor Company December 31, 2022 Level 1 Level 2 Level 3 Netting(1) Total (in millions) Retained Business Assets Fixed Maturity Securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 582 $ — $ — $ 582 Obligations of U.S. states and their political subdivisions — 136 — — 136 U.S. corporate public securities — 2,018 — — 2,018 U.S. corporate private securities — — 146 — 146 Foreign corporate public securities — 122 — — 122 Foreign corporate private securities — — 36 — 36 Asset-backed securities(2) — 358 155 — 513 Commercial mortgage-backed securities — 43 — — 43 Residential mortgage-backed securities — 20 — — 20 Total Fixed Maturity Securities $ — $ 3,279 $ 337 $ — $ 3,616 Mortgage and other loans — — 196 — 196 Short-term investments — 3 — — 3 Cash and cash equivalents 433 — — — 433 Other invested assets(3) 46 386 — (347) 85 Subtotal excluding separate account assets 479 3,668 533 (347) 4,333 Separate account assets — 21,558 — — 21,558 Total assets $ 479 $ 25,226 $ 533 $ (347) $ 25,891 Liabilities Insurance liabilities — — 2,941 — 2,941 Other liabilities - derivatives — 602 — (602) — Separate account liabilities — 21,558 — — 21,558 Total liabilities $ — $ 22,160 $ 2,941 $ (602) $ 24,499 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At December 31, 2022, the fair values of such investments were $344 million. See Note 4 for further details. Successor Company December 31, 2022 Level 1 Level 2 Level 3 Netting(1) Total (in millions) Ceded Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 114 $ — $ — $ 114 Obligations of U.S. states and their political subdivisions — 30 — — 30 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 778 — — 778 U.S. corporate private securities — 144 — — 144 Foreign corporate public securities — 89 — — 89 Foreign corporate private securities — 31 — — 31 Asset-backed securities(2) — 19 — — 19 Commercial mortgage-backed securities — — — — — Residential mortgage-backed securities — 198 — — 198 Total fixed maturity securities $ — $ 1,408 $ — $ — $ 1,408 Equity securities 175 — — — 175 Short-term investments — 39 — — 39 Cash and cash equivalents 439 — — — 439 Other invested assets(3) — 235 — (235) — Deposit asset — — 607 — 607 Reinsurance recoverables — — 235 — 235 Net modified coinsurance receivable — — 18 — 18 Subtotal excluding separate account assets 614 1,682 860 (235) 2,921 Separate account assets — 2,043 — — 2,043 Total assets $ 614 $ 3,725 $ 860 $ (235) $ 4,964 Liabilities Insurance liabilities — — 2,605 — 2,605 Other liabilities - derivatives — 473 — (272) 201 Separate account liabilities — 2,043 — 2,043 Total liabilities $ — $ 2,516 $ 2,605 $ (272) $ 4,849 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At December 31, 2022, the fair values of such investments were $1 million. See Note 4 for further details. 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. Successor Company March 31, 2023 Fair Value Valuation Techniques Unobservable Minimum Maximum Weighted Average Impact of (in millions) Assets: Retained business Fixed maturity securities U.S. corporate private securities $ 154 Discounted cash flow Discount rate 4.88 % 9.19 % 6.65 % Decrease 28 Trade price Trade price N/A N/A N/A Increase Total U.S. corporate private securities 182 Foreign corporate private securities 36 Discounted cash flow Discount rate 4.34 % 6.42 % 5.38 % Decrease Asset-backed securities 79 Discounted cash flow Discount rate 6.83 % 8.64 % 8.05 % Decrease 112 Trade price Trade price N/A N/A N/A Increase Total asset-backed securities 191 Mortgage and other loans Residential mortgage loans 158 Level yield Market yield 6.76 % 10.03 % 8.47 % Decrease Commercial mortgage loans 48 Trade price Trade price N/A N/A N/A Increase Total Mortgage and other loans 206 Ceded business Deposit asset 608 Fair values are determined using the same unobservable inputs as insurance liabilities. Reinsurance recoverables 247 Fair values are determined using the same unobservable inputs as insurance liabilities. Liabilities: Insurance liabilities Retained business $ 3,056 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.48 % Decrease Utilization rate(5) 77 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease Ceded business 2,695 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.07 % Decrease Utilization rate(5) 77 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease Net modified coinsurance payable 45 Fair values are determined using the same unobservable inputs as insurance liabilities. Successor Company December 31, 2022 Fair Value Valuation Techniques Unobservable Minimum Maximum Weighted Average Impact of (in millions) Assets: Retained business U.S. corporate private securities $ 146 Discounted cash flow Discount rate 4.75 % 8.03 % 6.56 % Decrease Foreign corporate public securities 36 Discounted cash flow Discount rate 4.33 % 6.38 % 5.36 % Decrease Asset-backed securities 155 Discounted cash flow Discount rate 7.19 % 8.51 % 7.94 % Decrease Mortgage and other loans Residential mortgage loans 161 Level yield Market yield 5.75 % 9.97 % 8.40 % Increase Commercial mortgage loans 35 Trade price Trade price N/A N/A N/A Increase Total Mortgage and other loans 196 Ceded business Deposit asset 607 Fair values are determined using the same unobservable inputs as insurance liabilities. Reinsurance recoverables 235 Fair values are determined using the same unobservable inputs as insurance liabilities. Net modified coinsurance receivable 18 Fair values are determined using the same unobservable inputs as insurance liabilities. Liabilities: Retained business Insurance liabilities $ 2,941 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.43 % Decrease Utilization rate(5) 92.5 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease Ceded business Insurance liabilities $ 2,605 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.21 % Decrease Utilization rate(5) 92.5 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease (1) Conversely, the impact of a decrease in input would have the opposite impact on fair value as that presented in the table. (2) The equity volatility curve assumption is based on 1 year and 2 year index-specific at-the-money implied volatilities grading to 10 year total variance. Increased volatility increases the fair value of the liability. (3) 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. (4) The spread over the risk-free rate (SOFR and LIBOR) swap curve represents the premium added to the proxy for the risk-free rate 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. (5) 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. 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. (6) 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 March 31, 2023 and December 31, 2022, the minimum withdrawal rate assumption is 77% 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%. (7) 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. 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. During weaker economic cycles, as the expectations of default increases, credit spreads widen, which results in a decrease in fair value. Insurance Liabilities, at fair value – The Company expects efficient benefit utilization and withdrawal rates to generally be correlated with lapse rates. However, behavior is 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 that 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. Successor Company Three Months Ended March 31, 2023 Fair Value, beginning of period Total realized and unrealized gains (losses) Purchases Sales Issuances Settlements Other Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(2) (in millions) Retained Business Fixed maturity securities U.S. corporate private securities $ 146 $ — $ 19 $ — $ — $ (1) $ — $ — $ 18 $ 182 $ — Foreign corporate private securities 36 — — — — — — — — 36 1 Asset-backed securities 155 (2) 38 — — — — — — 191 (2) Mortgage and other loans Residential mortgage loans 161 — 13 — — (16) — — — 158 — Commercial mortgage loans 35 — 13 — — — — — — 48 — Ceded Business Deposit asset 607 1 — — — — — — — 608 — Reinsurance recoverables 235 12 — — — — — — — 247 — Net modified coinsurance receivable (payable) 18 (63) — — — — — — — (45) — Successor Company Three Months Ended March 31, 2023 Incurred losses Fair Value, beginning of period Reduction in estimates of ultimate losses Increase in estimates of ultimate losses Change in fair value (discount rate) Paid losses Other Fair Value, end of period (in millions) Insurance Liabilities Retained Business $ 2,941 $ (348) $ 132 $ 235 $ 100 $ (4) $ 3,056 Ceded Business 2,605 (66) 67 76 13 — 2,695 "Total realized and unrealized gains (losses)" related to our level 3 assets are included in earnings in Investment gains (losses). Activity related to our level 3 liabilities is primarily recognized in earnings within change in Policyholder benefits and changes in fair value of insurance liabilities with the exception of changes related to the Company's own-credit risk, which are included in "Change in fair value (discount rate)" above and recorded in other comprehensive income (loss). Predecessor Company Three Months Ended March 31, 2022 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(2) (in millions) Fixed maturities, available-for-sale: U.S. government $ — $ — $ — $ — $ — $ — $ — $ — $ — $ — $ — Corporate securities(3) 190 (9) 5 (4) — (2) — — — 180 (9) Structured securities(4) 76 (4) — (10) — (2) — — (13) 47 (4) Other assets: Equity securities 1 — — — — — — — — 1 — Short term investments 13 — — — — (13) — — — — — Cash equivalents 8 — — — — (8) — — — — — Other assets 400 (21) 13 — — (16) — — — 376 (6) Reinsurance recoverables 1,881 201 4 — — 19 (239) — — 1,866 222 Liabilities: Future policy benefits (4,060) 715 — — (48) — — — — (3,393) 686 Policyholders' account balances(5) (2,041) 124 — — — (17) — — — (1,934) 89 Predecessor Company Three Months Ended March 31, 2022 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(2) Realized investment gains (losses), net(1) Other income (loss) Included in other comprehensive income (loss) Net investment income Realized investment gains (losses), net Other income (loss) Included in other comprehensive income (loss) (in millions) Fixed maturities, available-for-sale $ — $ — $ (12) $ — $ — $ — $ (12) Other assets: Other assets (21) — — — (6) — — Reinsurance recoverables 201 — — — 222 — — Liabilities: Future policy benefits 715 — — — 686 — — Policyholders' account balances 124 — — — 89 — — (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) 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. (3) Includes U.S. corporate public, U.S. corporate private, foreign corporate public and foreign corporate private securities. (4) Includes asset-backed and residential mortgage-backed securities. (5) Issuances and settlements for Policyholders' account balances are presented net in the rollforward. Change in Fair Value of Insurance Contracts The components of the change in fair value of our insurance contracts are reported in several line items within Revenues and Benefits and expenses in our consolidated statements of income and comprehensive income (loss). The revenue items include Premiums, Policy charges and fee income, and Asset management and service fees. The Benefits and expenses items include Policyholders' benefits and changes in fair value of insurance liabilities and commission expense. Policyholder benefits and changes in fair value of insurance liabilities includes the following changes in fair value of the assets and liabilities for which we have elected the fair value option: Successor Company March 31, 2023 December 31, 2022 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Assets: Reinsurance recoverables $ — $ 12 $ 12 $ — $ (15) $ (15) Modified coinsurance receivable — 78 78 — (5,640) (5,640) Deposit asset — 1 1 — (1,989) (1,989) Liabilities: Insurance liabilities $ 115 $ 90 $ 205 $ (421) $ (7,644) $ (8,065) Changes in insurance liabilities attributable to the Company's own-credit risk are recorded in other comprehensive income (loss). Changes in the modified coinsurance payable are reported in Policyholder benefits and changes in fair value of insurance liabilities, however, they are not included in the above chart as they relate to the investment portfolio within the modified coinsurance agreement. Fair Value of Financial Instruments 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 Company’s Consolidated Statements of Financial Position. In some cases the carrying amount equals or approximates fair value. Successor Company March 31, 2023 Fair Value Carrying Level 1 Level 2 Level 3 Total Total (in millions) Assets: Accrued investment income $ — $ 53 $ — $ 53 $ 53 Other invested assets - Policy loans — — 11 11 11 Liabilities: Repurchase agreements $ — $ 301 $ — $ 301 $ 301 Cash collateral for loaned securities — 164 — 164 164 Successor Company December 31, 2022 Fair Value Carrying Level 1 Level 2 Level 3 Total Total (in millions) Assets: Accrued investment income $ — $ 52 $ — $ 52 $ 52 Other invested assets - Policy loans — — 11 11 11 Liabilities: Repurchase agreements $ — $ 311 $ — $ 311 $ 311 Cash collateral for loaned securities — 106 — 106 106 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company uses a full year projected effective tax rate approach to calculate taxes. In addition, certain items impacting total income tax expense are recorded in the periods in which they occur. The projected effective tax rate is the ratio of projected “Income tax expense (benefit)” divided by projected “Income (loss) from operations before income taxes”. For the three months ended March 31, 2023, the Successor Company's income tax provision amounted to an income tax expense of approximately $0.3 million or 4.3 percent of income from operations before income taxes, respectively. The effective tax rate for the Successor Company differed from the U.S. statutory tax rate of 21 percent primarily due to non-taxable investment income. The Predecessor Company's income tax provision amounted to an income tax expense of $77 million or 17.8 percent of income from operations before income tax, for three months ended March 31, 2022, respectively. The effective tax rate for the Predecessor Company differed from the U.S. statutory tax rate of 21 percent primarily due to non-taxable investment income and tax credits. Valuation Allowance on Deferred Tax Assets |
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
EQUITY | EQUITY Additional Paid-in Capital During the three months ended March 31, 2023, the Company established a $45 million distribution payable to its parent company, FGH, as a result of updated information regarding certain tax assets related to the acquisition of FLIAC, which resulted in an offsetting reduction to "Additional paid-in capital". Accumulated Other Comprehensive Income (Loss) AOCI represents the cumulative OCI items that are reported separate from net income and detailed on the Consolidated Statements of Income and Comprehensive Income (Loss). As discussed in Note 1, we have elected to apply push-down accounting to FLIAC at the acquisition date, April 1, 2022. As part of this election, accumulated unrealized gains and losses that were previously recorded in AOCI were reset to zero at the acquisition date. In addition, as discussed in Note 2, we have elected to apply the fair value option on our entire portfolio of fixed maturity securities. As a result, all unrealized gains and losses related to our fixed maturity securities are recorded through earnings rather than AOCI. As discussed in Note 5, we have de-designated the hedging relationship for all of our derivative instruments. Accordingly, all changes in our derivative instruments are recorded through earnings. The balance of and changes in each component of AOCI are as follows: Successor Company Changes in Own-Credit Risk Related to Insurance Liabilities (in millions) Balance, December 31, 2022 $ 111 Change in OCI 22 Less: Income tax expense 5 Balance, March 31, 2023 $ 128 Predecessor Company Accumulated Other Comprehensive Income (Loss) Foreign Currency Translation Adjustment Net Unrealized Total Accumulated Other Comprehensive Income (Loss) (in millions) Balance, December 31, 2021 $ (1) $ 171 $ 170 Change in OCI before reclassifications — (576) (576) Amounts reclassified from AOCI — 15 15 Income tax benefit — 118 118 Balance, March 31, 2022 $ (1) $ (272) $ (273) (1) Includes cash flow hedges of $29 million as of March 31, 2022 . Reclassifications out of Accumulated Other Comprehensive Income (Loss) Predecessor Company Three Months Ended (in millions) Amounts reclassified from AOCI(1)(2): Net unrealized investment gains (losses): Cash flow hedges—Currency/ Interest rate(3) $ 5 Net unrealized investment losses on available-for-sale securities (20) Total net unrealized investment gains (losses)(4) (15) Total reclassifications for the period $ (15) (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 5 for additional information on cash flow hedges. (4) See table below for additional information on unrealized investment gains (losses), including the impact on DAC and other costs and future policy benefits and other liabilities. Net Unrealized Investment Losses Net unrealized investment losses on available-for-sale fixed maturity securities and certain other invested assets and other assets were included in the Predecessor Company’s Statements of Financial Position as a component of AOCI. Changes in these amounts included reclassification adjustments to exclude from OCI those items that were included as part of “Net income” for a period that had been part of OCI in earlier periods. The amounts indicated below, split between amounts related to net unrealized investment losses on available-for-sale fixed maturity securities on which an allowance for credit losses has been recognized, and all other net unrealized investment gains (losses), are as follows: Predecessor Company Net Unrealized DAC and Other Costs(2) Future Policy Benefits and Other Liabilities(3) Income Tax Accumulated Other Comprehensive (in millions) Balance, December 31, 2021 $ 240 $ (15) $ (7) $ (47) $ 171 Net investment gains (losses) on investments arising during the period (591) — — 125 (466) Reclassification adjustment for (gains) losses included in net income 15 — — (4) 11 Impact of net unrealized investment (gains) losses — 9 6 (3) 12 Balance, March 31, 2022 $ (336) $ (6) $ (1) $ 71 $ (272) (1) Includes cash flow hedges. See Note 5 for information on cash flow hedges. (2) "Other costs" primarily includes reinsurance recoverables, DSI and VOBA. (3) "Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains. |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | COMMITMENTS AND CONTINGENT LIABILITIES Commitments As of March 31, 2023, the outstanding balance on commitments for mortgage and other loans was $128 million. These amounts include unfunded commitments that are not unconditionally cancellable. The Company also made commitments to purchase or fund investments, mostly private fixed maturity securities and alternative investments. As of March 31, 2023, $478 million of these commitments were outstanding. These amounts include unfunded commitments that are not unconditionally cancellable. See Note 10 for further information regarding certain commitments to related parties. 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 March 31, 2023, the aggregate range of reasonably possible losses in excess of accruals and recoveries from unaffiliated indemnitors established for those litigation and regulatory matters for which such an estimate currently can be made is not considered to be material. 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. Regulatory Variable Products Prior to its acquisition by FGH on April 1, 2022, the Company has received regulatory inquiries and requests for information from state and federal regulators, including a subpoena from the U.S. Securities and Exchange Commission, concerning the appropriateness of variable product sales and replacement activity. The Company is cooperating with regulators and may become subject to additional regulatory inquiries and other actions related to this matter. 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 statements. 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 statements. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Successor Company The Successor Company has transactions and relationships with 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 Successor Company’s expenses are allocations or charges from FGH. These expenses primarily relate to general and administrative expenses which include accounting, actuarial, risk management, and data processing services. FGH also provides the Company with personnel and certain other services. The allocation of costs for other services are based on estimated level of usage, transactions or time incurred in providing the respective services. During the three month ended March 31, 2023, FLIAC was allocated $8 million of costs for these services. Intercompany Liquidity Agreement FLIAC entered into an intercompany liquidity agreement with FGH that allows the Successor Company to borrow funds of up to $300 million to meet its short-term liquidity and other capital needs. During the three months ended March 31, 2023, the Company borrowed $120 million of funds under the agreement, which was repaid in full, plus interest during the same period. As of March 31, 2023, there were no outstanding borrowings under the agreement. Affiliated Investment and Advisory Activities As of April 1, 2022, FLIAC became affiliated with The Carlyle Group Inc. (“Carlyle”), whereby Carlyle, through an affiliated investment fund has a 71.3% equity investment in its parent, FGH. In addition, FLIAC entered into an investment management and consulting services agreement with an affiliate of Carlyle. Certain of Carlyle's affiliates also provide investment management services for FLIAC pursuant to investment management agreements. Investment management fees are charged based on a percentage of assets under management. As of March 31, 2023 and December 31, 2022, assets under management had a market value of $754 million and $732 million, respectively, and were comprised primarily of private credit fixed income assets and limited partnership interests or investments in limited partnerships. FLIAC recognized $5 million of investment income on such assets during the three months ended March 31, 2023. In connection with the investment management agreements, as of March 31, 2023, FLIAC has unfunded commitments of $249 million to fund private investments where one or more Carlyle entities serves as general partner to the fund. Predecessor Company The Predecessor Company had extensive transactions and relationships with Prudential Insurance and other former affiliates. Although the Predecessor Company sought to ensure that these transactions and relationships were fair and reasonable, it is possible that the terms of these transactions were not the same as those that would result from transactions among unrelated parties. Expense Charges and Allocations The Predecessor Company’s expenses were allocations or charges from Prudential Insurance or other affiliates. These expenses were grouped into general and administrative expenses and agency distribution expenses. The Predecessor Company’s general and administrative expenses were charged using allocation methodologies based on business production processes. The Predecessor Company operated under service and lease agreements whereby services of officers and employees, supplies, use of equipment and office space were provided by Prudential Insurance. The Predecessor Company reviewed its allocation methodology periodically and made adjustments accordingly. The Predecessor Company paid commissions and certain other fees to Prudential Annuities Distributors, Inc ("PAD"), an affiliate of the Predecessor Company, in consideration for PAD’s marketing and underwriting of the Company’s products. Commissions and fees were paid by PAD to broker-dealers who sold the Predecessor Company’s products. Commissions and fees paid by the Predecessor Company to PAD were $29 million for the three months ended March 31, 2022. The Predecessor Company was 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 Predecessor Company’s share of corporate expenses was $9 million for three months ended March 31, 2022. Affiliated Investment Management Expenses The Predecessor Company paid investments management expenses in accordance with an agreement with PGIM, Inc. (“PGIM”), an affiliate of the Predecessor Company and investment manager to certain Predecessor Company general account and separate account assets. Investment management expenses paid to PGIM related to this agreement were $4 million for the three months ended March 31, 2022. These expenses were recorded as “Net investment income” in the Company's Unaudited Consolidated Interim Statements of Operations and Comprehensive Income (Loss). Affiliated Asset Management and Service Fees The Predecessor Company had a revenue sharing agreement with AST Investment Services, Inc. (“ASTISI”) and PGIM Investments LLC (“PGIM Investments”) whereby the Predecessor Company received 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 $22 million for the three months ended March 31, 2022. These revenues were recorded as “Asset management and service fees” in the Company's Unaudited Consolidated Interim Statements of Operations and Comprehensive Income (Loss). Derivative Trades In its ordinary course of business, the Predecessor Company entered into OTC derivative contracts with an affiliate, Provident Global Funding, LLC (“PGF”). For these OTC derivative contracts, PGF had a substantially equal and offsetting position with an external counterparty. See Note 5 for additional information. Affiliated Asset Transfers The Predecessor Company participated in affiliated asset trades with former parent and sister companies. Book and market value differences for trades with a parent and sister were recognized within "Investment gains (losses), net". The table below shows affiliated asset trades for the three months ended March 31, 2022. Affiliate Date Transaction Security Type Fair Value Book Value Realized (in millions) Pruco Life January 2022 Sale Fixed Maturity Securities 4 5 (1) Prudential Financial January 2022 Sale Commercial Mortgage Loan 29 30 (1) Pruco Life January 2022 Sale Derivatives — — — Pruco Life February 2022 Sale Fixed Maturity Securities 129 138 (9) Prudential Financial March 2022 Sale Fixed Maturity Securities $ 33 $ 33 $ — Contributed Capital and Dividends Through March 31, 2022, the Predecessor Company did not receive any capital contributions. In March 2022, the Predecessor Company had a return of capital in the amount of $306 million to PAI. Reinsurance with Affiliates of Predecessor Company Reinsurance amounts, included in the Predecessor Company’s Unaudited Interim Statements of Operations and Comprehensive Income (Loss), were as follows: Three Months Ended 2022 (in millions) Premiums: Direct $ 9 Ceded (1) Net premiums 8 Policy charges and fee income: Direct 102 Ceded (5) Net policy charges and fee income 97 Asset management and service fees: Direct 22 Ceded (2) Net asset management and service fees 20 Realized investment gains (losses), net: Direct 312 Ceded 169 Realized investment gains (losses), net 481 Policyholders' benefits (including change in reserves): Direct 31 Ceded (5) Net policyholders' benefits (including change in reserves) 26 Interest credited to policyholders’ account balances: Direct 91 Ceded (6) Net interest credited to policyholders’ account balances 85 Reinsurance expense allowances and general and administrative expenses, net of capitalization and amortization (41) |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Unaudited Interim Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). The accompanying Unaudited Consolidated Financial Statements present the consolidated results of operations, financial condition, and cash flows of the Successor Company and a variable interest entity ("VIE") that meets the requirements for consolidation. All intercompany transactions have been eliminated in consolidation. The financial statements of the Predecessor Company were not consolidated as it was a single entity prior to acquisition. Following the acquisition of FLIAC, purchase accounting was applied to FGH's financial statements and we have elected to "push down" the basis to FLIAC in accordance with Accounting Standards Codification ("ASC") 805, Business Combinations . The application of push-down accounting created a new basis of accounting for all assets and liabilities based on fair value at the date of acquisition. As a result, FLIAC's financial position, results of operations, and cash flows subsequent to the acquisition are not comparable with those prior to April 1, 2022, and therefore have been segregated to indicate pre-acquisition and post-acquisition periods. The pre-acquisition period through March 31, 2022 is referred to as the Predecessor Company. The post-acquisition period, April 1, 2022 and forward, includes the impact of push-down accounting and is referred to as the Successor Company. See Notes 1 and 2 in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for further information regarding the acquisition and our application of push-down accounting. In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
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. |
Reclassifications | Reclassifications Certain amounts in prior periods have been reclassified to conform to the current period presentation. |
Fair Value Option | Fair Value Option We have elected to prospectively apply the fair value option to several of FLIAC's assets and liabilities. We have made this election as it improves our operational efficiency and better aligns the recognition and measurement of our investments, insurance liabilities, and associated reinsurance activity with how we expect to manage the business. See Note 6 herein and Notes 2 and 6 in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for further information. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of an Accounting Standards Update ("ASU") to the ASC. We consider 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 the date of this filing. ASUs not listed below were assessed and determined to be either not applicable or not material. Effective ASUs - March 31, 2023 ASU 2018-12, Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts , was issued by the FASB. This update became effective January 1, 2023 but is not applicable due to our election to adopt the fair value option on all of our insurance liabilities, which includes our separate account liabilities. ASU 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt restructurings and Vintage Disclosures, was issued by the FASB . This update became effective January 1, 2023 but is not applicable due to our election to adopt the fair value option on financial instruments that are within the scope of this update. |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following is the Consolidated Statement of Financial Position by segment: March 31, 2023 Retained Business Ceded Business Total (in millions) ASSETS Total investments $ 4,457 $ 1,678 $ 6,135 Cash and cash equivalents 389 456 845 Accrued investment income 42 11 53 Reinsurance recoverables — 247 247 Deposit asset — 608 608 Goodwill 93 — 93 Income tax 45 — 45 Other assets 70 28 98 Separate account assets 21,909 2,076 23,985 TOTAL ASSETS $ 27,005 $ 5,104 $ 32,109 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities $ 3,056 $ 2,695 $ 5,751 Net modified coinsurance payable — 45 45 Other liabilities 474 288 762 Separate account liabilities 21,909 2,076 23,985 TOTAL LIABILITIES 25,439 5,104 30,543 EQUITY 1,566 — 1,566 TOTAL LIABILITIES AND EQUITY $ 27,005 $ 5,104 $ 32,109 December 31, 2022 Retained Business Ceded Business Total (in millions) ASSETS Total investments $ 4,257 $ 1,630 $ 5,887 Cash and cash equivalents 433 439 872 Accrued investment income 41 11 52 Reinsurance recoverables — 235 235 Net modified coinsurance receivable — 18 18 Deposit asset — 607 607 Goodwill 93 — 93 Income tax 50 — 50 Other assets 113 14 127 Separate account assets 21,558 2,043 23,601 TOTAL ASSETS $ 26,545 $ 4,997 $ 31,542 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities $ 2,941 $ 2,605 $ 5,546 Other liabilities 459 349 808 Separate account liabilities 21,558 2,043 23,601 TOTAL LIABILITIES 24,958 4,997 29,955 EQUITY 1,587 — 1,587 TOTAL LIABILITIES AND EQUITY $ 26,545 $ 4,997 $ 31,542 The following is comprehensive income by segment: Three Months Ended March 31, 2023 Retained Business Ceded Business Total (in millions) REVENUES Premiums $ 7 $ — $ 7 Policy charges and fee income 117 — 117 Net investment income 56 20 76 Asset management and service fees 22 — 22 Other income 1 — 1 Investment gains, net 30 135 165 TOTAL REVENUES 233 155 388 BENEFITS AND EXPENSES Policyholder benefits and changes in fair value of insurance liabilities 185 155 340 Commission expense 23 — 23 General, administrative and other expenses 18 — 18 TOTAL BENEFITS AND EXPENSES 226 155 381 INCOME FROM OPERATIONS BEFORE INCOME TAXES 7 — 7 Income tax expense — — — NET INCOME $ 7 $ — $ 7 Other comprehensive income, before tax: Changes in own-credit risk related to insurance liabilities 22 22 Less: Income tax expense 5 5 Other comprehensive income, net of taxes 17 — 17 COMPREHENSIVE INCOME $ 24 $ — $ 24 |
Reconciliation of Assets from Segment to Consolidated | The following is the Consolidated Statement of Financial Position by segment: March 31, 2023 Retained Business Ceded Business Total (in millions) ASSETS Total investments $ 4,457 $ 1,678 $ 6,135 Cash and cash equivalents 389 456 845 Accrued investment income 42 11 53 Reinsurance recoverables — 247 247 Deposit asset — 608 608 Goodwill 93 — 93 Income tax 45 — 45 Other assets 70 28 98 Separate account assets 21,909 2,076 23,985 TOTAL ASSETS $ 27,005 $ 5,104 $ 32,109 LIABILITIES AND EQUITY LIABILITIES Insurance liabilities $ 3,056 $ 2,695 $ 5,751 Net modified coinsurance payable — 45 45 Other liabilities 474 288 762 Separate account liabilities 21,909 2,076 23,985 TOTAL LIABILITIES 25,439 5,104 30,543 EQUITY 1,566 — 1,566 TOTAL LIABILITIES AND EQUITY $ 27,005 $ 5,104 $ 32,109 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Other Invested Assets | The following table sets forth the composition of “Other invested assets,” as of the dates indicated. March 31, 2023 December 31, 2022 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) LPs/LLCs: Equity method: Private equity $ — $ 3 $ 3 $ — $ 4 $ 4 Real estate-related — 5 5 — 5 5 Subtotal equity method — 8 8 — 9 9 Fair value: Private equity 352 1 353 344 1 345 Total LPs/LLCs 352 9 361 344 10 354 Derivative instruments 74 — 74 85 — 85 Policy loans 11 — 11 11 — 11 Total other invested assets $ 437 $ 9 $ 446 $ 440 $ 10 $ 450 |
Accrued Investment Income | The following table sets forth the composition of “Accrued investment income,” as of the dates indicated: March 31, 2023 December 31, 2022 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Fixed maturity securities $ 40 $ 9 $ 49 $ 37 $ 10 $ 47 Mortgage and other loans 1 — 1 1 — 1 Short-term investments and cash equivalents 1 2 3 3 1 4 Total accrued investment income $ 42 $ 11 $ 53 $ 41 $ 11 $ 52 |
Net Investment Income | The following table sets forth “Net investment income” by investment type, for the periods indicated: Three Months Ended March 31, 2023 Retained Business Ceded Business Total (in millions) Fixed maturities securities $ 47 $ 14 $ 61 Equity securities — 1 1 Mortgage and other loans 4 — 4 Other invested assets 12 1 13 Short-term investments and cash equivalents 2 6 8 Gross investment income 65 22 87 Less: investment expenses (9) (2) (11) Net investment income $ 56 $ 20 $ 76 Net Investment Income The following table sets forth “Net investment income” by investment type, for the periods indicated: Three Months Ended March 31, 2022 (in millions) Fixed maturities securities (1) $ 61 Equity securities 1 Mortgage and other loans 11 Other invested assets 29 Short-term investments and cash equivalents 1 Gross investment income 103 Less: investment expenses (4) Net investment income $ 99 (1) Includes fixed maturity securities classified as available-for-sale and trading. |
Schedule of Realized Gain (Loss) | The following table sets forth “Investment gains, net” by investment type, for the periods indicated: Three Months Ended March 31, 2023 Retained Business Ceded Business Total Business Unrealized Realized Total Unrealized Realized Total Unrealized Realized Total (in millions) Fixed maturity securities $ 156 $ (26) $ 130 $ 21 $ — $ 21 $ 177 $ (26) $ 151 Equity securities — — — 7 — 7 7 — 7 Derivatives — (100) (100) — 107 107 — 7 7 Total $ 156 $ (126) $ 30 $ 28 $ 107 $ 135 $ 184 $ (19) $ 165 The following table sets forth “Investment gains, net” by investment type, for the periods indicated: Three Months Ended March 31, 2022 (in millions) Fixed maturity securities (1) $ (21) Derivatives 502 Total $ 481 |
Repurchase Agreements and Securities Lending | March 31, 2023 December 31, 2022 Remaining Contractual Maturities of the Agreements Overnight & Continuous Up to 30 days 30-90 days Total Overnight & Continuous Up to 30 days 30-90 days Total (in millions) U.S. corporate public securities $ — $ 200 $ 101 $ 301 $ — $ 111 $ 200 $ 311 March 31, 2023 December 31, 2022 Remaining Contractual Maturities of the Agreements Overnight & Continuous Up to 30 days 30-90 days Total Overnight & Continuous Up to 30 days 30-90 days Total (in millions) Equity securities $ 164 $ — $ — $ 164 $ 106 $ — $ — $ 106 |
Sources of Fixed Maturity Proceeds, Realized Investment Gains (Losses), and Losses on Impairments | The following table sets forth the sources of proceeds and related investment losses for available-for-sale fixed maturity securities: Three months ended March 31 2022 (in millions) Fixed maturities, available-for-sale: Proceeds from sales(1) $ 294 Proceeds from maturities/prepayments 108 Gross investment losses on sales and maturities (21) (1) Excludes activity from non-cash related proceeds due to the timing of trade settlements of $20 million for three months ended March 31, 2022. |
DERIVATIVES AND HEDGING (Tables
DERIVATIVES AND HEDGING (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | March 31, 2023 December 31, 2022 Primary Underlying Risk/Instrument Type Gross Fair Value Gross Fair Value Assets Liabilities Assets Liabilities (in millions) Retained Business Interest Rate Interest Rate Swaps $ 16,005 $ 237 $ (409) $ 12,131 $ 228 $ (553) Currency/Interest Rate Foreign Currency Swaps 102 11 — 100 11 — Credit Credit Default Swaps 520 7 — 520 5 — Equity Equity Futures (2,086) — (111) (1,737) 46 — Total Return Swaps 366 16 (14) — 24 (49) Equity Options 2,949 76 — 3,286 118 — Total Derivatives, Retained Business 17,856 347 (534) 14,300 432 (602) Ceded Business Interest Rate Interest Rate Swaps 1,300 40 (41) 2,517 48 (117) Currency/Interest Rate Foreign Currency Swaps 48 6 — 48 6 — Credit Credit Default Swaps 71 1 — 71 1 — Equity Total Return Swaps 22 — — — — — Equity Options 5,357 147 (207) 7,139 180 (356) Total Derivatives, Ceded Business 6,798 194 (248) 9,775 235 (473) Total Derivatives (1) $ 24,654 $ 541 $ (782) $ 24,075 $ 667 $ (1,075) (1) Recorded in “Other invested assets” and “Other liabilities” in the Consolidated Statements of Financial Position. |
Offsetting Assets | The following table presents recognized derivative instruments that are offset in the Consolidated 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 Consolidated Statements of Financial Position. March 31, 2023 Gross Gross Amounts Net Financial Net (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 78 $ (4) $ 74 $ (74) $ — Ceded Business 194 (194) — — — Total $ 272 $ (198) $ 74 $ (74) $ — Offsetting of Financial Liabilities: Derivatives Retained Business $ 265 $ (265) $ — $ — $ — Ceded Business 248 (194) 54 — 54 Total $ 513 $ (459) $ 54 $ — $ 54 Repurchase agreements $ 301 $ — $ 301 $ (301) $ — Securities lending transactions $ 164 $ — $ 164 $ (162) $ 2 December 31, 2022 Gross Gross Amounts Net Amounts Presented in the Statement of Financial Position Financial Net (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 183 $ (98) $ 85 $ (85) $ — Ceded Business 235 (235) — — — Total $ 418 $ (333) $ 85 $ (85) $ — Offsetting of Financial Liabilities: Derivatives Retained Business $ 353 $ (353) $ — $ — $ — Ceded Business 473 (272) 201 — 201 Total $ 826 $ (625) $ 201 $ — $ 201 Repurchase agreements 311 — 311 (311) — Securities lending transactions 106 — 106 (103) 3 (1) Amounts exclude the excess of collateral received/pledged from/to the counterparty. |
Offsetting Liabilities | The following table presents recognized derivative instruments that are offset in the Consolidated 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 Consolidated Statements of Financial Position. March 31, 2023 Gross Gross Amounts Net Financial Net (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 78 $ (4) $ 74 $ (74) $ — Ceded Business 194 (194) — — — Total $ 272 $ (198) $ 74 $ (74) $ — Offsetting of Financial Liabilities: Derivatives Retained Business $ 265 $ (265) $ — $ — $ — Ceded Business 248 (194) 54 — 54 Total $ 513 $ (459) $ 54 $ — $ 54 Repurchase agreements $ 301 $ — $ 301 $ (301) $ — Securities lending transactions $ 164 $ — $ 164 $ (162) $ 2 December 31, 2022 Gross Gross Amounts Net Amounts Presented in the Statement of Financial Position Financial Net (in millions) Offsetting of Financial Assets: Derivatives Retained Business $ 183 $ (98) $ 85 $ (85) $ — Ceded Business 235 (235) — — — Total $ 418 $ (333) $ 85 $ (85) $ — Offsetting of Financial Liabilities: Derivatives Retained Business $ 353 $ (353) $ — $ — $ — Ceded Business 473 (272) 201 — 201 Total $ 826 $ (625) $ 201 $ — $ 201 Repurchase agreements 311 — 311 (311) — Securities lending transactions 106 — 106 (103) 3 (1) Amounts exclude the excess of collateral received/pledged from/to the counterparty. |
Derivative Instruments, Gain (Loss) | The following tables provide the financial statement classification and impact of derivatives, by segment. Successor Company Three Months Ended March 31, 2023 Investment gains, net (in millions) Retained Business Interest Rate $ 115 Equity (215) Total, Retained Business (100) Ceded Business Interest Rate 31 Equity 76 Total, Ceded Business 107 Total $ 7 Predecessor Company Three Months Ended March 31, 2022 Investment Net Investment Other Income Change in AOCI (in millions) Derivatives Designated as Hedge Accounting Instruments: Cash flow hedges Currency/Interest Rate $ 1 $ 1 $ 2 $ 4 Derivatives Not Qualifying as Hedge Accounting Instruments: Interest Rate (527) — — — Currency/Interest Rate (6) — — — Credit (12) — — — Equity 59 — — — Embedded Derivatives 986 — — — Total Derivatives Not Qualifying as Hedge Accounting Instruments 500 — — — Total $ 501 $ 1 $ 2 $ 4 |
FAIR VALUE OF ASSETS AND LIAB_2
FAIR VALUE OF ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of 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. Successor Company March 31, 2023 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Total Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 587 $ — $ — $ 587 Obligations of U.S. states and their political subdivisions — 175 — — 175 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 2,903 — — 2,903 U.S. corporate private securities — 147 182 — 329 Foreign corporate public securities — 217 — — 217 Foreign corporate private securities — 33 36 — 69 Asset-backed securities(2) — 478 191 — 669 Commercial mortgage-backed securities — 42 — — 42 Residential mortgage-backed securities — 243 — — 243 Total fixed maturity securities — 4,830 409 — 5,239 Equity securities 182 — — — 182 Mortgage and other loans (3) — — 206 — 206 Short-term investments — 62 — — 62 Cash and cash equivalents 845 — — — 845 Other invested assets(4) — 272 — (198) 74 Deposit asset — — 608 — 608 Reinsurance recoverables — — 247 — 247 Subtotal excluding separate account assets 1,027 5,164 1,470 (198) 7,463 Separate account assets — 23,985 — — 23,985 Total assets $ 1,027 $ 29,149 $ 1,470 $ (198) $ 31,448 Liabilities Insurance liabilities $ — $ — $ 5,751 $ — $ 5,751 Other liabilities - derivatives — 513 — (459) 54 Net modified coinsurance payable — — 45 — 45 Separate account liabilities — 23,985 — — 23,985 Total liabilities $ — $ 24,498 $ 5,796 $ (459) $ 29,835 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of March 31, 2023, the difference between the aggregate fair value and the aggregate unpaid principal of mortgage and other loans was de minimis. There were no mortgage and other loans that were 90 days or more past due or in non-accrual status. (4) Other invested assets within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At March 31, 2023 the fair values of such investments were $353 million. See Note 4 for further details. Successor Company March 31, 2023 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Retained Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 513 $ — $ — $ 513 Obligations of U.S. states and their political subdivisions — 145 — — 145 U.S. corporate public securities — 2,090 — — 2,090 U.S. corporate private securities — — 182 — 182 Foreign corporate public securities — 127 — — 127 Foreign corporate private securities — — 36 — 36 Asset-backed securities(2) — 459 191 — 650 Commercial mortgage-backed securities — 42 — — 42 Residential mortgage-backed securities — 29 — — 29 Total fixed maturity securities — 3,405 409 — 3,814 Mortgage and other loans — — 206 — 206 Short-term investments — — — — — Cash and cash equivalents 389 — — — 389 Other invested assets(3) — 78 — (4) 74 Subtotal excluding separate account assets 389 3,483 615 (4) 4,483 Separate account assets — 21,909 — — 21,909 Total assets $ 389 $ 25,392 $ 615 $ (4) $ 26,392 Liabilities Insurance liabilities $ — $ — $ 3,056 $ — $ 3,056 Other liabilities - derivatives — 265 — (265) — Separate account liabilities — 21,909 — — 21,909 Total liabilities $ — $ 22,174 $ 3,056 $ (265) $ 24,965 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At March 31, 2023 the fair values of such investments were $352 million. See Note 4 for further details. Successor Company March 31, 2023 Level 1 Level 2 Level 3 Netting (1) Total (in millions) Ceded Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 74 $ — $ — $ 74 Obligations of U.S. states and their political subdivisions — 30 — — 30 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 813 — — 813 U.S. corporate private securities — 147 — — 147 Foreign corporate public securities — 90 — — 90 Foreign corporate private securities — 33 — — 33 Asset-backed securities(2) — 19 — — 19 Residential mortgage-backed securities — 214 — — 214 Total fixed maturity securities — 1,425 — — 1,425 Equity securities 182 — — — 182 Short-term investments — 62 — — 62 Cash and cash equivalents 456 — — — 456 Other invested assets(3) — 194 — (194) — Deposit asset — — 608 — 608 Reinsurance recoverables — — 247 — 247 Subtotal excluding separate account assets 638 1,681 855 (194) 2,980 Separate account assets — 2,076 — — 2,076 Total assets $ 638 $ 3,757 $ 855 $ (194) $ 5,056 Liabilities Insurance liabilities $ — $ — $ 2,695 $ — $ 2,695 Other liabilities - derivatives — 248 — (194) 54 Net modified coinsurance payable — — 45 — 45 Separate account liabilities — 2,076 — — 2,076 Total liabilities $ — $ 2,324 $ 2,740 $ (194) $ 4,870 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At March 31, 2023 the fair values of such investments were $1 million. See Note 4 for further details. Successor Company December 31, 2022 Level 1 Level 2 Level 3 Netting(1) Total (in millions) Total Business Assets Fixed Maturity Securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 696 $ — $ — $ 696 Obligations of U.S. states and their political subdivisions — 166 — — 166 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 2,796 — — 2,796 U.S. corporate private securities — 144 146 — 290 Foreign corporate public securities — 211 — — 211 Foreign corporate private securities — 31 36 — 67 Asset-backed securities(2) — 377 155 — 532 Commercial mortgage-backed securities — 43 — — 43 Residential mortgage-backed securities — 218 — — 218 Total Fixed Maturity Securities — 4,687 337 — 5,024 Equity securities 175 — — 175 Mortgage and other loans (3) — — 196 — 196 Short-term investments — 42 — — 42 Cash and cash equivalents 872 — — — 872 Other invested assets(4) 46 621 — (582) 85 Deposit asset — — 607 — 607 Reinsurance recoverables — — 235 — 235 Net modified coinsurance receivable — — 18 — 18 Subtotal excluding separate account assets 1,093 5,350 1,393 (582) 7,254 Separate account assets — 23,601 — — 23,601 Total assets $ 1,093 $ 28,951 $ 1,393 $ (582) $ 30,855 Liabilities Insurance liabilities — — 5,546 — 5,546 Other liabilities - derivatives — 1,076 — (875) 201 Separate account liabilities — 23,601 — — 23,601 Total liabilities $ — $ 24,677 $ 5,546 $ (875) $ 29,348 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (2) Includes credit-tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types. (3) As of December 31, 2022, the difference between the aggregate fair value and the aggregate unpaid principal of mortgage and other loans was de minimis. There were no mortgage and other loans that were 90 days or more past due or in non-accrual status. (4) Other invested assets within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At December 31, 2022 the fair values of such investments were $345 million, respectively. See Note 4 for further details. Successor Company December 31, 2022 Level 1 Level 2 Level 3 Netting(1) Total (in millions) Retained Business Assets Fixed Maturity Securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 582 $ — $ — $ 582 Obligations of U.S. states and their political subdivisions — 136 — — 136 U.S. corporate public securities — 2,018 — — 2,018 U.S. corporate private securities — — 146 — 146 Foreign corporate public securities — 122 — — 122 Foreign corporate private securities — — 36 — 36 Asset-backed securities(2) — 358 155 — 513 Commercial mortgage-backed securities — 43 — — 43 Residential mortgage-backed securities — 20 — — 20 Total Fixed Maturity Securities $ — $ 3,279 $ 337 $ — $ 3,616 Mortgage and other loans — — 196 — 196 Short-term investments — 3 — — 3 Cash and cash equivalents 433 — — — 433 Other invested assets(3) 46 386 — (347) 85 Subtotal excluding separate account assets 479 3,668 533 (347) 4,333 Separate account assets — 21,558 — — 21,558 Total assets $ 479 $ 25,226 $ 533 $ (347) $ 25,891 Liabilities Insurance liabilities — — 2,941 — 2,941 Other liabilities - derivatives — 602 — (602) — Separate account liabilities — 21,558 — — 21,558 Total liabilities $ — $ 22,160 $ 2,941 $ (602) $ 24,499 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At December 31, 2022, the fair values of such investments were $344 million. See Note 4 for further details. Successor Company December 31, 2022 Level 1 Level 2 Level 3 Netting(1) Total (in millions) Ceded Business Assets Fixed maturity securities U.S Treasury securities and obligations of U.S. government authorities and agencies $ — $ 114 $ — $ — $ 114 Obligations of U.S. states and their political subdivisions — 30 — — 30 Foreign government bonds — 5 — — 5 U.S. corporate public securities — 778 — — 778 U.S. corporate private securities — 144 — — 144 Foreign corporate public securities — 89 — — 89 Foreign corporate private securities — 31 — — 31 Asset-backed securities(2) — 19 — — 19 Commercial mortgage-backed securities — — — — — Residential mortgage-backed securities — 198 — — 198 Total fixed maturity securities $ — $ 1,408 $ — $ — $ 1,408 Equity securities 175 — — — 175 Short-term investments — 39 — — 39 Cash and cash equivalents 439 — — — 439 Other invested assets(3) — 235 — (235) — Deposit asset — — 607 — 607 Reinsurance recoverables — — 235 — 235 Net modified coinsurance receivable — — 18 — 18 Subtotal excluding separate account assets 614 1,682 860 (235) 2,921 Separate account assets — 2,043 — — 2,043 Total assets $ 614 $ 3,725 $ 860 $ (235) $ 4,964 Liabilities Insurance liabilities — — 2,605 — 2,605 Other liabilities - derivatives — 473 — (272) 201 Separate account liabilities — 2,043 — 2,043 Total liabilities $ — $ 2,516 $ 2,605 $ (272) $ 4,849 (1) “Netting” amounts represent offsetting considerations as disclosed in Note 5. (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 within the above chart are comprised of derivatives. Excluded from the above chart are private equity funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. At December 31, 2022, the fair values of such investments were $1 million. See Note 4 for further details. Successor Company March 31, 2023 December 31, 2022 Retained Business Ceded Business Total Retained Business Ceded Business Total (in millions) Assets: Reinsurance recoverables $ — $ 12 $ 12 $ — $ (15) $ (15) Modified coinsurance receivable — 78 78 — (5,640) (5,640) Deposit asset — 1 1 — (1,989) (1,989) Liabilities: Insurance liabilities $ 115 $ 90 $ 205 $ (421) $ (7,644) $ (8,065) |
Schedule of Assumptions for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement | The tables below present quantitative information on significant internally-priced Level 3 assets and liabilities. Successor Company March 31, 2023 Fair Value Valuation Techniques Unobservable Minimum Maximum Weighted Average Impact of (in millions) Assets: Retained business Fixed maturity securities U.S. corporate private securities $ 154 Discounted cash flow Discount rate 4.88 % 9.19 % 6.65 % Decrease 28 Trade price Trade price N/A N/A N/A Increase Total U.S. corporate private securities 182 Foreign corporate private securities 36 Discounted cash flow Discount rate 4.34 % 6.42 % 5.38 % Decrease Asset-backed securities 79 Discounted cash flow Discount rate 6.83 % 8.64 % 8.05 % Decrease 112 Trade price Trade price N/A N/A N/A Increase Total asset-backed securities 191 Mortgage and other loans Residential mortgage loans 158 Level yield Market yield 6.76 % 10.03 % 8.47 % Decrease Commercial mortgage loans 48 Trade price Trade price N/A N/A N/A Increase Total Mortgage and other loans 206 Ceded business Deposit asset 608 Fair values are determined using the same unobservable inputs as insurance liabilities. Reinsurance recoverables 247 Fair values are determined using the same unobservable inputs as insurance liabilities. Liabilities: Insurance liabilities Retained business $ 3,056 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.48 % Decrease Utilization rate(5) 77 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease Ceded business 2,695 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.07 % Decrease Utilization rate(5) 77 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease Net modified coinsurance payable 45 Fair values are determined using the same unobservable inputs as insurance liabilities. Successor Company December 31, 2022 Fair Value Valuation Techniques Unobservable Minimum Maximum Weighted Average Impact of (in millions) Assets: Retained business U.S. corporate private securities $ 146 Discounted cash flow Discount rate 4.75 % 8.03 % 6.56 % Decrease Foreign corporate public securities 36 Discounted cash flow Discount rate 4.33 % 6.38 % 5.36 % Decrease Asset-backed securities 155 Discounted cash flow Discount rate 7.19 % 8.51 % 7.94 % Decrease Mortgage and other loans Residential mortgage loans 161 Level yield Market yield 5.75 % 9.97 % 8.40 % Increase Commercial mortgage loans 35 Trade price Trade price N/A N/A N/A Increase Total Mortgage and other loans 196 Ceded business Deposit asset 607 Fair values are determined using the same unobservable inputs as insurance liabilities. Reinsurance recoverables 235 Fair values are determined using the same unobservable inputs as insurance liabilities. Net modified coinsurance receivable 18 Fair values are determined using the same unobservable inputs as insurance liabilities. Liabilities: Retained business Insurance liabilities $ 2,941 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.43 % Decrease Utilization rate(5) 92.5 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease Ceded business Insurance liabilities $ 2,605 Discounted cash flow Equity volatility curve (2) 19.5 % 26 % Increase Lapse rate(3) 1 % 20 % Decrease Spread over risk free (4) 0.00 % 2.21 % Decrease Utilization rate(5) 92.5 % 100 % Increase Withdrawal rate (6) See table footnote (6) below. Mortality rate(7) 0 % 16 % Decrease (1) Conversely, the impact of a decrease in input would have the opposite impact on fair value as that presented in the table. (2) The equity volatility curve assumption is based on 1 year and 2 year index-specific at-the-money implied volatilities grading to 10 year total variance. Increased volatility increases the fair value of the liability. (3) 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. (4) The spread over the risk-free rate (SOFR and LIBOR) swap curve represents the premium added to the proxy for the risk-free rate 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. (5) 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. 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. (6) 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 March 31, 2023 and December 31, 2022, the minimum withdrawal rate assumption is 77% 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%. |
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. Successor Company Three Months Ended March 31, 2023 Fair Value, beginning of period Total realized and unrealized gains (losses) Purchases Sales Issuances Settlements Other Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(2) (in millions) Retained Business Fixed maturity securities U.S. corporate private securities $ 146 $ — $ 19 $ — $ — $ (1) $ — $ — $ 18 $ 182 $ — Foreign corporate private securities 36 — — — — — — — — 36 1 Asset-backed securities 155 (2) 38 — — — — — — 191 (2) Mortgage and other loans Residential mortgage loans 161 — 13 — — (16) — — — 158 — Commercial mortgage loans 35 — 13 — — — — — — 48 — Ceded Business Deposit asset 607 1 — — — — — — — 608 — Reinsurance recoverables 235 12 — — — — — — — 247 — Net modified coinsurance receivable (payable) 18 (63) — — — — — — — (45) — Successor Company Three Months Ended March 31, 2023 Incurred losses Fair Value, beginning of period Reduction in estimates of ultimate losses Increase in estimates of ultimate losses Change in fair value (discount rate) Paid losses Other Fair Value, end of period (in millions) Insurance Liabilities Retained Business $ 2,941 $ (348) $ 132 $ 235 $ 100 $ (4) $ 3,056 Ceded Business 2,605 (66) 67 76 13 — 2,695 "Total realized and unrealized gains (losses)" related to our level 3 assets are included in earnings in Investment gains (losses). Activity related to our level 3 liabilities is primarily recognized in earnings within change in Policyholder benefits and changes in fair value of insurance liabilities with the exception of changes related to the Company's own-credit risk, which are included in "Change in fair value (discount rate)" above and recorded in other comprehensive income (loss). Predecessor Company Three Months Ended March 31, 2022 Fair Value, beginning of period Total realized and unrealized gains (losses)(1) Purchases Sales Issuances Settlements Other Transfers into Level 3 Transfers out of Level 3 Fair Value, end of period Unrealized gains (losses) for assets still held(2) (in millions) Fixed maturities, available-for-sale: U.S. government $ — $ — $ — $ — $ — $ — $ — $ — $ — $ — $ — Corporate securities(3) 190 (9) 5 (4) — (2) — — — 180 (9) Structured securities(4) 76 (4) — (10) — (2) — — (13) 47 (4) Other assets: Equity securities 1 — — — — — — — — 1 — Short term investments 13 — — — — (13) — — — — — Cash equivalents 8 — — — — (8) — — — — — Other assets 400 (21) 13 — — (16) — — — 376 (6) Reinsurance recoverables 1,881 201 4 — — 19 (239) — — 1,866 222 Liabilities: Future policy benefits (4,060) 715 — — (48) — — — — (3,393) 686 Policyholders' account balances(5) (2,041) 124 — — — (17) — — — (1,934) 89 Predecessor Company Three Months Ended March 31, 2022 Total realized and unrealized gains (losses) Unrealized gains (losses) for assets still held(2) Realized investment gains (losses), net(1) Other income (loss) Included in other comprehensive income (loss) Net investment income Realized investment gains (losses), net Other income (loss) Included in other comprehensive income (loss) (in millions) Fixed maturities, available-for-sale $ — $ — $ (12) $ — $ — $ — $ (12) Other assets: Other assets (21) — — — (6) — — Reinsurance recoverables 201 — — — 222 — — Liabilities: Future policy benefits 715 — — — 686 — — Policyholders' account balances 124 — — — 89 — — (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) 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. (3) Includes U.S. corporate public, U.S. corporate private, foreign corporate public and foreign corporate private securities. (4) Includes asset-backed and residential mortgage-backed securities. |
Fair Value, by Balance Sheet Grouping | 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 Company’s Consolidated Statements of Financial Position. In some cases the carrying amount equals or approximates fair value. Successor Company March 31, 2023 Fair Value Carrying Level 1 Level 2 Level 3 Total Total (in millions) Assets: Accrued investment income $ — $ 53 $ — $ 53 $ 53 Other invested assets - Policy loans — — 11 11 11 Liabilities: Repurchase agreements $ — $ 301 $ — $ 301 $ 301 Cash collateral for loaned securities — 164 — 164 164 Successor Company December 31, 2022 Fair Value Carrying Level 1 Level 2 Level 3 Total Total (in millions) Assets: Accrued investment income $ — $ 52 $ — $ 52 $ 52 Other invested assets - Policy loans — — 11 11 11 Liabilities: Repurchase agreements $ — $ 311 $ — $ 311 $ 311 Cash collateral for loaned securities — 106 — 106 106 |
EQUITY (Tables)
EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Schedule of Stockholders Equity | The balance of and changes in each component of AOCI are as follows: Successor Company Changes in Own-Credit Risk Related to Insurance Liabilities (in millions) Balance, December 31, 2022 $ 111 Change in OCI 22 Less: Income tax expense 5 Balance, March 31, 2023 $ 128 Predecessor Company Accumulated Other Comprehensive Income (Loss) Foreign Currency Translation Adjustment Net Unrealized Total Accumulated Other Comprehensive Income (Loss) (in millions) Balance, December 31, 2021 $ (1) $ 171 $ 170 Change in OCI before reclassifications — (576) (576) Amounts reclassified from AOCI — 15 15 Income tax benefit — 118 118 Balance, March 31, 2022 $ (1) $ (272) $ (273) (1) Includes cash flow hedges of $29 million as of March 31, 2022 . |
Reclassification out of Accumulated Other Comprehensive Income | Reclassifications out of Accumulated Other Comprehensive Income (Loss) Predecessor Company Three Months Ended (in millions) Amounts reclassified from AOCI(1)(2): Net unrealized investment gains (losses): Cash flow hedges—Currency/ Interest rate(3) $ 5 Net unrealized investment losses on available-for-sale securities (20) Total net unrealized investment gains (losses)(4) (15) Total reclassifications for the period $ (15) (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 5 for additional information on cash flow hedges. (4) See table below for additional information on unrealized investment gains (losses), including the impact on DAC and other costs and future policy benefits and other liabilities. |
Other Net Unrealized Investment Gain Loss AOCI Roll Forward | The amounts indicated below, split between amounts related to net unrealized investment losses on available-for-sale fixed maturity securities on which an allowance for credit losses has been recognized, and all other net unrealized investment gains (losses), are as follows: Predecessor Company Net Unrealized DAC and Other Costs(2) Future Policy Benefits and Other Liabilities(3) Income Tax Accumulated Other Comprehensive (in millions) Balance, December 31, 2021 $ 240 $ (15) $ (7) $ (47) $ 171 Net investment gains (losses) on investments arising during the period (591) — — 125 (466) Reclassification adjustment for (gains) losses included in net income 15 — — (4) 11 Impact of net unrealized investment (gains) losses — 9 6 (3) 12 Balance, March 31, 2022 $ (336) $ (6) $ (1) $ 71 $ (272) (1) Includes cash flow hedges. See Note 5 for information on cash flow hedges. (2) "Other costs" primarily includes reinsurance recoverables, DSI and VOBA. (3) "Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Affiliated Asset Transfer | The table below shows affiliated asset trades for the three months ended March 31, 2022. Affiliate Date Transaction Security Type Fair Value Book Value Realized (in millions) Pruco Life January 2022 Sale Fixed Maturity Securities 4 5 (1) Prudential Financial January 2022 Sale Commercial Mortgage Loan 29 30 (1) Pruco Life January 2022 Sale Derivatives — — — Pruco Life February 2022 Sale Fixed Maturity Securities 129 138 (9) Prudential Financial March 2022 Sale Fixed Maturity Securities $ 33 $ 33 $ — |
Reinsurance Impact On Income Statement | Reinsurance amounts, included in the Predecessor Company’s Unaudited Interim Statements of Operations and Comprehensive Income (Loss), were as follows: Three Months Ended 2022 (in millions) Premiums: Direct $ 9 Ceded (1) Net premiums 8 Policy charges and fee income: Direct 102 Ceded (5) Net policy charges and fee income 97 Asset management and service fees: Direct 22 Ceded (2) Net asset management and service fees 20 Realized investment gains (losses), net: Direct 312 Ceded 169 Realized investment gains (losses), net 481 Policyholders' benefits (including change in reserves): Direct 31 Ceded (5) Net policyholders' benefits (including change in reserves) 26 Interest credited to policyholders’ account balances: Direct 91 Ceded (6) Net interest credited to policyholders’ account balances 85 Reinsurance expense allowances and general and administrative expenses, net of capitalization and amortization (41) |
BUSINESS AND BASIS OF PRESENT_2
BUSINESS AND BASIS OF PRESENTATION - Narrative (Details) $ in Millions | 12 Months Ended |
Mar. 31, 2023 USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Contracts novated | $ 7 |
Contracts novated, since acquisition | 66% |
SEGMENT INFORMATION - Narrative
SEGMENT INFORMATION - Narrative (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | |
Segment Reporting [Abstract] | ||
Number of reportable segments | segment | 2 | |
Amount of assets and labilities fully ceded | 1 | |
Modco payable | $ | $ 1,886 | $ 1,745 |
SEGMENT INFORMATION - Balance S
SEGMENT INFORMATION - Balance Sheet by Segment (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Total investments | $ 6,135 | $ 5,887 |
Cash and cash equivalents | 845 | 872 |
Accrued investment income | 53 | 52 |
Reinsurance recoverables, at fair value | 247 | 235 |
Net modified coinsurance receivable | 0 | 18 |
Deposit asset | 608 | 607 |
Goodwill | 93 | 93 |
Income tax | 45 | 50 |
Other assets | 98 | 127 |
Separate account assets, at fair value | 23,985 | 23,601 |
Total assets | 32,109 | 31,542 |
Liabilities: | ||
Insurance liabilities | 5,751 | 5,546 |
Net modified coinsurance payable | 45 | |
Other liabilities | 762 | 808 |
Separate account liabilities, at fair value | 23,985 | 23,601 |
Total liabilities | 30,543 | 29,955 |
Total equity | 1,566 | 1,587 |
TOTAL LIABILITIES AND EQUITY | 32,109 | 31,542 |
Retained Business | ||
Assets | ||
Total investments | 4,457 | 4,257 |
Cash and cash equivalents | 389 | 433 |
Accrued investment income | 42 | 41 |
Reinsurance recoverables, at fair value | 0 | 0 |
Net modified coinsurance receivable | 0 | |
Deposit asset | 0 | 0 |
Goodwill | 93 | 93 |
Income tax | 45 | 50 |
Other assets | 70 | 113 |
Separate account assets, at fair value | 21,909 | 21,558 |
Total assets | 27,005 | 26,545 |
Liabilities: | ||
Insurance liabilities | 3,056 | 2,941 |
Net modified coinsurance payable | 0 | |
Other liabilities | 474 | 459 |
Separate account liabilities, at fair value | 21,909 | 21,558 |
Total liabilities | 25,439 | 24,958 |
Total equity | 1,566 | 1,587 |
TOTAL LIABILITIES AND EQUITY | 27,005 | 26,545 |
Ceded Business | ||
Assets | ||
Total investments | 1,678 | 1,630 |
Cash and cash equivalents | 456 | 439 |
Accrued investment income | 11 | 11 |
Reinsurance recoverables, at fair value | 247 | 235 |
Net modified coinsurance receivable | 18 | |
Deposit asset | 608 | 607 |
Goodwill | 0 | 0 |
Income tax | 0 | 0 |
Other assets | 28 | 14 |
Separate account assets, at fair value | 2,076 | 2,043 |
Total assets | 5,104 | 4,997 |
Liabilities: | ||
Insurance liabilities | 2,695 | 2,605 |
Net modified coinsurance payable | 45 | |
Other liabilities | 288 | 349 |
Separate account liabilities, at fair value | 2,076 | 2,043 |
Total liabilities | 5,104 | 4,997 |
Total equity | 0 | 0 |
TOTAL LIABILITIES AND EQUITY | $ 5,104 | $ 4,997 |
SEGMENT INFORMATION - Schedule
SEGMENT INFORMATION - Schedule of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
REVENUES | |||
Premiums | $ 7 | $ 8 | $ 8 |
Policy charges and fee income | 117 | 97 | 97 |
Net investment income | 76 | 99 | 99 |
Asset management and service fees | 22 | 20 | |
Other income | 1 | ||
Investment gains, net | 165 | 481 | 481 |
TOTAL REVENUES | 388 | 686 | |
BENEFITS AND EXPENSES | |||
Policyholder benefits and changes in fair value of insurance liabilities | 340 | ||
Commission expense | 23 | 35 | |
General, administrative and other expenses | 18 | 3 | |
TOTAL BENEFITS AND EXPENSES | 381 | 253 | |
INCOME FROM OPERATIONS BEFORE INCOME TAXES | 7 | 433 | |
Income tax expense | 0.3 | 77 | 77 |
NET INCOME | 7 | 356 | |
Other comprehensive income (loss), before tax: | |||
Changes in own-credit risk related to insurance liabilities | 22 | 0 | |
Less: Income tax expense | 5 | (118) | |
Other comprehensive income, net of tax | 17 | (443) | $ (443) |
COMPREHENSIVE INCOME (LOSS) | 24 | $ (87) | |
Retained Business | |||
REVENUES | |||
Premiums | 7 | ||
Policy charges and fee income | 117 | ||
Net investment income | 56 | ||
Asset management and service fees | 22 | ||
Other income | 1 | ||
Investment gains, net | 30 | ||
TOTAL REVENUES | 233 | ||
BENEFITS AND EXPENSES | |||
Policyholder benefits and changes in fair value of insurance liabilities | 185 | ||
Commission expense | 23 | ||
General, administrative and other expenses | 18 | ||
TOTAL BENEFITS AND EXPENSES | 226 | ||
INCOME FROM OPERATIONS BEFORE INCOME TAXES | 7 | ||
Income tax expense | 0 | ||
NET INCOME | 7 | ||
Other comprehensive income (loss), before tax: | |||
Changes in own-credit risk related to insurance liabilities | 22 | ||
Less: Income tax expense | 5 | ||
Other comprehensive income, net of tax | 17 | ||
COMPREHENSIVE INCOME (LOSS) | 24 | ||
Ceded Business | |||
REVENUES | |||
Premiums | 0 | ||
Policy charges and fee income | 0 | ||
Net investment income | 20 | ||
Asset management and service fees | 0 | ||
Other income | 0 | ||
Investment gains, net | 135 | ||
TOTAL REVENUES | 155 | ||
BENEFITS AND EXPENSES | |||
Policyholder benefits and changes in fair value of insurance liabilities | 155 | ||
Commission expense | 0 | ||
General, administrative and other expenses | 0 | ||
TOTAL BENEFITS AND EXPENSES | 155 | ||
INCOME FROM OPERATIONS BEFORE INCOME TAXES | 0 | ||
Income tax expense | 0 | ||
NET INCOME | 0 | ||
Other comprehensive income (loss), before tax: | |||
Changes in own-credit risk related to insurance liabilities | |||
Less: Income tax expense | |||
Other comprehensive income, net of tax | 0 | ||
COMPREHENSIVE INCOME (LOSS) | $ 0 |
INVESTMENTS - Other Invested As
INVESTMENTS - Other Invested Assets (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | $ 446 | $ 450 |
Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 437 | 440 |
Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 9 | 10 |
Partnership Interest | Fair Value | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 361 | 354 |
Partnership Interest | Fair Value | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 352 | 344 |
Partnership Interest | Fair Value | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 9 | 10 |
Private equity | Partnership Interest | Fair Value | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 353 | 345 |
Private equity | Partnership Interest | Fair Value | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 352 | 344 |
Private equity | Partnership Interest | Fair Value | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 1 | 1 |
Derivative instruments | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 74 | 85 |
Derivative instruments | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 74 | 85 |
Derivative instruments | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 0 | 0 |
Policy loans | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 11 | 11 |
Policy loans | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 11 | 11 |
Policy loans | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 0 | 0 |
Equity Method Investments | Partnership Interest | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 8 | 9 |
Equity Method Investments | Partnership Interest | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 0 | 0 |
Equity Method Investments | Partnership Interest | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 8 | 9 |
Equity Method Investments | Private equity | Partnership Interest | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 3 | 4 |
Equity Method Investments | Private equity | Partnership Interest | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 0 | 0 |
Equity Method Investments | Private equity | Partnership Interest | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 3 | 4 |
Equity Method Investments | Real estate-related | Partnership Interest | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 5 | 5 |
Equity Method Investments | Real estate-related | Partnership Interest | Retained Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | 0 | 0 |
Equity Method Investments | Real estate-related | Partnership Interest | Ceded Business | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total other invested assets | $ 5 | $ 5 |
INVESTMENTS - Accrued Investmen
INVESTMENTS - Accrued Investment Income (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Net Investment Income [Line Items] | ||
Total accrued investment income | $ 53 | $ 52 |
Retained Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 42 | 41 |
Ceded Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 11 | 11 |
Fixed maturity securities | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 49 | 47 |
Fixed maturity securities | Retained Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 40 | 37 |
Fixed maturity securities | Ceded Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 9 | 10 |
Mortgage and other loans | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 1 | 1 |
Mortgage and other loans | Retained Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 1 | 1 |
Mortgage and other loans | Ceded Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 0 | 0 |
Short-term investments and cash equivalents | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 3 | 4 |
Short-term investments and cash equivalents | Retained Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | 1 | 3 |
Short-term investments and cash equivalents | Ceded Business | ||
Net Investment Income [Line Items] | ||
Total accrued investment income | $ 2 | $ 1 |
INVESTMENTS - Net Investment In
INVESTMENTS - Net Investment Income (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
Net Investment Income [Line Items] | |||
Gross investment income | $ 87 | $ 103 | |
Less: investment expenses | (11) | (4) | |
Net investment income | 76 | $ 99 | 99 |
Retained Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 65 | ||
Less: investment expenses | (9) | ||
Net investment income | 56 | ||
Ceded Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 22 | ||
Less: investment expenses | (2) | ||
Net investment income | 20 | ||
Fixed maturity securities | |||
Net Investment Income [Line Items] | |||
Gross investment income | 61 | 61 | |
Fixed maturity securities | Retained Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 47 | ||
Fixed maturity securities | Ceded Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 14 | ||
Equity securities | |||
Net Investment Income [Line Items] | |||
Gross investment income | 1 | 1 | |
Equity securities | Retained Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 0 | ||
Equity securities | Ceded Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 1 | ||
Mortgage and other loans | |||
Net Investment Income [Line Items] | |||
Gross investment income | 4 | 11 | |
Mortgage and other loans | Retained Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 4 | ||
Mortgage and other loans | Ceded Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 0 | ||
Other invested assets | |||
Net Investment Income [Line Items] | |||
Gross investment income | 13 | 29 | |
Other invested assets | Retained Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 12 | ||
Other invested assets | Ceded Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 1 | ||
Short-term investments and cash equivalents | |||
Net Investment Income [Line Items] | |||
Gross investment income | 8 | $ 1 | |
Short-term investments and cash equivalents | Retained Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | 2 | ||
Short-term investments and cash equivalents | Ceded Business | |||
Net Investment Income [Line Items] | |||
Gross investment income | $ 6 |
INVESTMENTS - Realized Investme
INVESTMENTS - Realized Investment Gains (Losses), Net (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | $ 184 | ||
Realized gains (losses) on investments | (19) | ||
Investment gains, net | 165 | $ 481 | $ 481 |
Retained Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 156 | ||
Realized gains (losses) on investments | (126) | ||
Investment gains, net | 30 | ||
Ceded Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 28 | ||
Realized gains (losses) on investments | 107 | ||
Investment gains, net | 135 | ||
Fixed maturity securities | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 177 | ||
Realized gains (losses) on investments | (26) | ||
Investment gains, net | 151 | ||
Fixed maturity securities | Retained Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 156 | ||
Realized gains (losses) on investments | (26) | ||
Investment gains, net | 130 | ||
Fixed maturity securities | Ceded Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 21 | ||
Realized gains (losses) on investments | 0 | ||
Investment gains, net | 21 | ||
Equity securities | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 7 | ||
Realized gains (losses) on investments | 0 | ||
Investment gains, net | 7 | (21) | |
Equity securities | Retained Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 0 | ||
Realized gains (losses) on investments | 0 | ||
Investment gains, net | 0 | ||
Equity securities | Ceded Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 7 | ||
Realized gains (losses) on investments | 0 | ||
Investment gains, net | 7 | ||
Derivative instruments | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 0 | ||
Realized gains (losses) on investments | 7 | ||
Investment gains, net | 7 | $ 502 | |
Derivative instruments | Retained Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 0 | ||
Realized gains (losses) on investments | (100) | ||
Investment gains, net | (100) | ||
Derivative instruments | Ceded Business | |||
Net Investment Income [Line Items] | |||
Unrealized gains (losses) on investments | 0 | ||
Realized gains (losses) on investments | 107 | ||
Investment gains, net | $ 107 |
INVESTMENTS - Repurchase Agreem
INVESTMENTS - Repurchase Agreements and Securities Lending (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
U.S. corporate public securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | $ 301 | $ 311 |
Equity securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | 164 | 106 |
Overnight & Continuous | U.S. corporate public securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | 0 | 0 |
Overnight & Continuous | Equity securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | 164 | 106 |
Up to 30 days | U.S. corporate public securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | 200 | 111 |
Up to 30 days | Equity securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | 0 | 0 |
30-90 days | U.S. corporate public securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | 101 | 200 |
30-90 days | Equity securities | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities | $ 0 | $ 0 |
INVESTMENTS - Narrative (Detail
INVESTMENTS - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
U.S. corporate public securities | |||
Debt Securities, Available-for-Sale [Line Items] | |||
Securities | $ 301 | $ 311 | |
U.S. corporate public securities | Fair Value | |||
Debt Securities, Available-for-Sale [Line Items] | |||
Securities | 318 | 326 | |
Equity securities | |||
Debt Securities, Available-for-Sale [Line Items] | |||
Securities | 164 | 106 | |
Equity securities | Fair Value | |||
Debt Securities, Available-for-Sale [Line Items] | |||
Securities | $ 162 | $ 103 | |
Mortgage and other loans | |||
Debt Securities, Available-for-Sale [Line Items] | |||
Commercial mortgage and other loans, allowance for credit losses | $ 1 |
INVESTMENTS - Fixed Maturity Pr
INVESTMENTS - Fixed Maturity Proceeds and Investment Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Net Investment Income [Line Items] | ||
Fixed maturity securities, available-for-sale | $ 0 | $ 422 |
Fixed Maturities | ||
Net Investment Income [Line Items] | ||
Proceeds from sales | 294 | |
Fixed maturity securities, available-for-sale | 108 | |
Gross investment losses on sales and maturities | (21) | |
Noncash related proceeds | $ 20 |
DERIVATIVES AND HEDGING - Prima
DERIVATIVES AND HEDGING - Primary Risks Managed by Derivatives (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Fair value, assets | $ 272 | $ 418 |
Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 24,654 | 24,075 |
Fair value, assets | 541 | 667 |
Fair value, liabilities | (782) | (1,075) |
Retained Business | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Fair value, assets | 78 | 183 |
Retained Business | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 17,856 | 14,300 |
Fair value, assets | 347 | 432 |
Fair value, liabilities | (534) | (602) |
Retained Business | Interest Rate Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 16,005 | 12,131 |
Fair value, assets | 237 | 228 |
Fair value, liabilities | (409) | (553) |
Retained Business | Foreign Currency Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 102 | 100 |
Fair value, assets | 11 | 11 |
Fair value, liabilities | 0 | 0 |
Retained Business | Credit Default Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 520 | 520 |
Fair value, assets | 7 | 5 |
Fair value, liabilities | 0 | 0 |
Retained Business | Equity Futures | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | (2,086) | (1,737) |
Fair value, assets | 0 | 46 |
Fair value, liabilities | (111) | 0 |
Retained Business | Total Return Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 366 | 0 |
Fair value, assets | 16 | 24 |
Fair value, liabilities | (14) | (49) |
Retained Business | Equity Options | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 2,949 | 3,286 |
Fair value, assets | 76 | 118 |
Fair value, liabilities | 0 | 0 |
Ceded Business | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Fair value, assets | 194 | 235 |
Ceded Business | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 6,798 | 9,775 |
Fair value, assets | 194 | 235 |
Fair value, liabilities | (248) | (473) |
Ceded Business | Interest Rate Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 1,300 | 2,517 |
Fair value, assets | 40 | 48 |
Fair value, liabilities | (41) | (117) |
Ceded Business | Foreign Currency Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 48 | 48 |
Fair value, assets | 6 | 6 |
Fair value, liabilities | 0 | 0 |
Ceded Business | Credit Default Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 71 | 71 |
Fair value, assets | 1 | 1 |
Fair value, liabilities | 0 | 0 |
Ceded Business | Total Return Swaps | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 22 | 0 |
Fair value, assets | 0 | 0 |
Fair value, liabilities | 0 | 0 |
Ceded Business | Equity Options | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Notional Values/Units | 5,357 | 7,139 |
Fair value, assets | 147 | 180 |
Fair value, liabilities | $ (207) | $ (356) |
DERIVATIVES AND HEDGING - Offse
DERIVATIVES AND HEDGING - Offsetting Assets and Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Offsetting of Financial Assets: | ||
Gross Amounts of Recognized Financial Instruments | $ 272 | $ 418 |
Gross Amounts Offset in the Statements of Financial Position | (198) | (333) |
Net Amounts Presented in the Statements of Financial Position | 74 | 85 |
Financial Instruments/Collateral | (74) | (85) |
Net Amount | 0 | 0 |
Derivative instruments | ||
Offsetting of Financial Liabilities: | ||
Gross Amounts of Recognized Financial Instruments | 513 | 826 |
Gross Amounts Offset in the Statements of Financial Position | (459) | (625) |
Net Amounts Presented in the Statements of Financial Position | 54 | 201 |
Financial Instruments/Collateral | 0 | 0 |
Net Amount | 54 | 201 |
Repurchase Agreements | ||
Offsetting of Financial Liabilities: | ||
Gross Amounts of Recognized Financial Instruments | 301 | 311 |
Gross Amounts Offset in the Statements of Financial Position | 0 | 0 |
Net Amounts Presented in the Statements of Financial Position | 301 | 311 |
Financial Instruments/Collateral | (301) | (311) |
Net Amount | 0 | 0 |
Securities Lending Transaction | ||
Offsetting of Financial Liabilities: | ||
Gross Amounts of Recognized Financial Instruments | 164 | 106 |
Gross Amounts Offset in the Statements of Financial Position | 0 | 0 |
Net Amounts Presented in the Statements of Financial Position | 164 | 106 |
Financial Instruments/Collateral | (162) | (103) |
Net Amount | 2 | 3 |
Retained Business | ||
Offsetting of Financial Assets: | ||
Gross Amounts of Recognized Financial Instruments | 78 | 183 |
Gross Amounts Offset in the Statements of Financial Position | (4) | (98) |
Net Amounts Presented in the Statements of Financial Position | 74 | 85 |
Financial Instruments/Collateral | (74) | (85) |
Net Amount | 0 | 0 |
Retained Business | Derivative instruments | ||
Offsetting of Financial Liabilities: | ||
Gross Amounts of Recognized Financial Instruments | 265 | 353 |
Gross Amounts Offset in the Statements of Financial Position | (265) | (353) |
Net Amounts Presented in the Statements of Financial Position | 0 | 0 |
Financial Instruments/Collateral | 0 | 0 |
Net Amount | 0 | 0 |
Ceded Business | ||
Offsetting of Financial Assets: | ||
Gross Amounts of Recognized Financial Instruments | 194 | 235 |
Gross Amounts Offset in the Statements of Financial Position | (194) | (235) |
Net Amounts Presented in the Statements of Financial Position | 0 | 0 |
Financial Instruments/Collateral | 0 | 0 |
Net Amount | 0 | 0 |
Ceded Business | Derivative instruments | ||
Offsetting of Financial Liabilities: | ||
Gross Amounts of Recognized Financial Instruments | 248 | 473 |
Gross Amounts Offset in the Statements of Financial Position | (194) | (272) |
Net Amounts Presented in the Statements of Financial Position | 54 | 201 |
Financial Instruments/Collateral | 0 | 0 |
Net Amount | $ 54 | $ 201 |
DERIVATIVES AND HEDGING - Impac
DERIVATIVES AND HEDGING - Impact of Derivatives by Operating Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 7 | |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Investment gains, net | |
Investment gains, net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 501 | |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Investment gains, net | |
Investment gains, net | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 500 | |
Net Investment Income | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 1 | |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net investment income | |
Net Investment Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 0 | |
Other Income | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 2 | |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other income (loss) | |
Other Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 0 | |
Change in AOCI | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 4 | |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net unrealized investment losses | |
Change in AOCI | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 0 | |
Interest Rate | Investment gains, net | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | (527) | |
Interest Rate | Net Investment Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Interest Rate | Other Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Interest Rate | Change in AOCI | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Currency/Interest Rate | Investment gains, net | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 1 | |
Currency/Interest Rate | Investment gains, net | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | (6) | |
Currency/Interest Rate | Net Investment Income | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 1 | |
Currency/Interest Rate | Net Investment Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Currency/Interest Rate | Other Income | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 2 | |
Currency/Interest Rate | Other Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Currency/Interest Rate | Change in AOCI | Designated as Hedging Instrument | Cash Flow Hedging | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 4 | |
Currency/Interest Rate | Change in AOCI | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Credit | Investment gains, net | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | (12) | |
Credit | Net Investment Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Credit | Other Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Credit | Change in AOCI | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Equity | Investment gains, net | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 59 | |
Equity | Net Investment Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Equity | Other Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Equity | Change in AOCI | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Embedded Derivatives | Investment gains, net | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 986 | |
Embedded Derivatives | Net Investment Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Embedded Derivatives | Other Income | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 0 | |
Embedded Derivatives | Change in AOCI | Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 0 | |
Retained Business | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ (100) | |
Retained Business | Investment gains, net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Investment gains, net | |
Retained Business | Net Investment Income | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net investment income | |
Retained Business | Other Income | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other income (loss) | |
Retained Business | Change in AOCI | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net unrealized investment losses | |
Retained Business | Interest Rate | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 115 | |
Retained Business | Equity | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | (215) | |
Ceded Business | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 107 | |
Ceded Business | Net Investment Income | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net investment income | |
Ceded Business | Other Income | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other income (loss) | |
Ceded Business | Change in AOCI | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net unrealized investment losses | |
Ceded Business | Interest Rate | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | 31 | |
Ceded Business | Equity | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative, gain (loss) | $ 76 |
FAIR VALUE OF ASSETS AND LIAB_3
FAIR VALUE OF ASSETS AND LIABILITIES - Assets and Liabilities by Hierarchy Level (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fixed maturity securities | ||
Asset-backed securities | $ 5,239 | $ 5,024 |
Equity securities | 182 | 175 |
Short-term investments | 62 | 42 |
Other invested assets | 446 | 450 |
Deposit asset | 608 | 607 |
Separate account assets, at fair value | 23,985 | 23,601 |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751 | 5,546 |
Other liabilities | 762 | 808 |
Net modified coinsurance payable | 45 | 0 |
Separate account liabilities, at fair value | 23,985 | 23,601 |
Retained Business | ||
Fixed maturity securities | ||
Other invested assets | 437 | 440 |
Separate account assets, at fair value | 21,909 | 21,558 |
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Other liabilities | 474 | 459 |
Separate account liabilities, at fair value | 21,909 | 21,558 |
Ceded Business | ||
Fixed maturity securities | ||
Other invested assets | 9 | 10 |
Separate account assets, at fair value | 2,076 | 2,043 |
Liabilities: | ||
Insurance liabilities, at fair value | 2,695 | 2,605 |
Other liabilities | 288 | 349 |
Separate account liabilities, at fair value | 2,076 | 2,043 |
Recurring | ||
Fixed maturity securities | ||
Asset-backed securities | 5,239 | 5,024 |
Equity securities | 182 | 175 |
Mortgage and other loans | 206 | 196 |
Short-term investments | 62 | 42 |
Cash and cash equivalents | 845 | 872 |
Other invested assets | 74 | 85 |
Other invested assets, Netting | (198) | (582) |
Deposit asset | 608 | 607 |
Reinsurance recoverables | 247 | 235 |
Net modified coinsurance receivable | 18 | |
Subtotal excluding separate account assets | 7,463 | 7,254 |
Separate account assets, at fair value | 23,985 | 23,601 |
Total assets | 31,448 | 30,855 |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751 | 5,546 |
Other liabilities | 54 | 201 |
Net modified coinsurance payable | 45 | |
Separate account liabilities, at fair value | 23,985 | 23,601 |
Liabilities, Netting | (459) | (875) |
Total liabilities | 29,835 | 29,348 |
Recurring | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 3,814 | 3,616 |
Mortgage and other loans | 206 | 196 |
Short-term investments | 0 | 3 |
Cash and cash equivalents | 389 | 433 |
Other invested assets | 74 | 85 |
Other invested assets, Netting | (4) | (347) |
Subtotal excluding separate account assets | 4,483 | 4,333 |
Separate account assets, at fair value | 21,909 | 21,558 |
Total assets | 26,392 | 25,891 |
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Other liabilities | 0 | 0 |
Separate account liabilities, at fair value | 21,909 | 21,558 |
Liabilities, Netting | (265) | (602) |
Total liabilities | 24,965 | 24,499 |
Recurring | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 1,425 | 1,408 |
Equity securities | 182 | 175 |
Short-term investments | 62 | 39 |
Cash and cash equivalents | 456 | 439 |
Other invested assets | 0 | 0 |
Other invested assets, Netting | (194) | (235) |
Deposit asset | 608 | 607 |
Reinsurance recoverables | 247 | 235 |
Net modified coinsurance receivable | 18 | |
Subtotal excluding separate account assets | 2,980 | 2,921 |
Separate account assets, at fair value | 2,076 | 2,043 |
Total assets | 5,056 | 4,964 |
Liabilities: | ||
Insurance liabilities, at fair value | 2,695 | 2,605 |
Other liabilities | 54 | 201 |
Separate account liabilities, at fair value | 2,076 | 2,043 |
Liabilities, Netting | (194) | (272) |
Total liabilities | 4,870 | 4,849 |
Recurring | U.S Treasury securities and obligations of U.S. government authorities and agencies | ||
Fixed maturity securities | ||
Asset-backed securities | 587 | 696 |
Recurring | U.S Treasury securities and obligations of U.S. government authorities and agencies | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 513 | 582 |
Recurring | U.S Treasury securities and obligations of U.S. government authorities and agencies | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 74 | 114 |
Recurring | Obligations of U.S. states and their political subdivisions | ||
Fixed maturity securities | ||
Asset-backed securities | 175 | 166 |
Recurring | Obligations of U.S. states and their political subdivisions | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 145 | 136 |
Recurring | Obligations of U.S. states and their political subdivisions | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 30 | 30 |
Recurring | Foreign government bonds | ||
Fixed maturity securities | ||
Asset-backed securities | 5 | 5 |
Recurring | Foreign government bonds | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 5 | 5 |
Recurring | U.S. corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 2,903 | 2,796 |
Recurring | U.S. corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 2,090 | 2,018 |
Recurring | U.S. corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 813 | 778 |
Recurring | U.S. corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 329 | 290 |
Recurring | U.S. corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 182 | 146 |
Recurring | U.S. corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 147 | 144 |
Recurring | Foreign corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 217 | 211 |
Recurring | Foreign corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 127 | 122 |
Recurring | Foreign corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 90 | 89 |
Recurring | Foreign corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 69 | 67 |
Recurring | Foreign corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 36 | 36 |
Recurring | Foreign corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 33 | 31 |
Recurring | Asset-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 669 | 532 |
Recurring | Asset-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 650 | 513 |
Recurring | Asset-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 19 | 19 |
Recurring | Commercial mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 42 | 43 |
Recurring | Commercial mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 42 | 43 |
Recurring | Commercial mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | |
Recurring | Residential mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 243 | 218 |
Recurring | Residential mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 29 | 20 |
Recurring | Residential mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 214 | 198 |
Recurring | Level 1 | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Equity securities | 182 | 175 |
Mortgage and other loans | 0 | 0 |
Short-term investments | 0 | 0 |
Cash and cash equivalents | 845 | 872 |
Other invested assets | 0 | 46 |
Deposit asset | 0 | 0 |
Reinsurance recoverables | 0 | 0 |
Net modified coinsurance receivable | 0 | |
Subtotal excluding separate account assets | 1,027 | 1,093 |
Separate account assets, at fair value | 0 | 0 |
Total assets | 1,027 | 1,093 |
Liabilities: | ||
Insurance liabilities, at fair value | 0 | 0 |
Other liabilities | 0 | 0 |
Net modified coinsurance payable | 0 | |
Separate account liabilities, at fair value | 0 | 0 |
Total liabilities | 0 | 0 |
Recurring | Level 1 | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Mortgage and other loans | 0 | 0 |
Short-term investments | 0 | 0 |
Cash and cash equivalents | 389 | 433 |
Other invested assets | 0 | 46 |
Subtotal excluding separate account assets | 389 | 479 |
Separate account assets, at fair value | 0 | 0 |
Total assets | 389 | 479 |
Liabilities: | ||
Insurance liabilities, at fair value | 0 | 0 |
Other liabilities | 0 | 0 |
Separate account liabilities, at fair value | 0 | 0 |
Total liabilities | 0 | 0 |
Recurring | Level 1 | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Equity securities | 182 | 175 |
Short-term investments | 0 | 0 |
Cash and cash equivalents | 456 | 439 |
Other invested assets | 0 | 0 |
Deposit asset | 0 | 0 |
Reinsurance recoverables | 0 | 0 |
Net modified coinsurance receivable | 0 | |
Subtotal excluding separate account assets | 638 | 614 |
Separate account assets, at fair value | 0 | 0 |
Total assets | 638 | 614 |
Liabilities: | ||
Insurance liabilities, at fair value | 0 | 0 |
Other liabilities | 0 | 0 |
Separate account liabilities, at fair value | 0 | 0 |
Total liabilities | 0 | 0 |
Recurring | Level 1 | U.S Treasury securities and obligations of U.S. government authorities and agencies | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S Treasury securities and obligations of U.S. government authorities and agencies | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S Treasury securities and obligations of U.S. government authorities and agencies | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Obligations of U.S. states and their political subdivisions | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Obligations of U.S. states and their political subdivisions | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Obligations of U.S. states and their political subdivisions | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign government bonds | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign government bonds | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S. corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S. corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S. corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S. corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S. corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | U.S. corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Asset-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Asset-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Asset-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Commercial mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Commercial mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Commercial mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | |
Recurring | Level 1 | Residential mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Residential mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 1 | Residential mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 2 | ||
Fixed maturity securities | ||
Asset-backed securities | 4,830 | 4,687 |
Equity securities | 0 | 0 |
Mortgage and other loans | 0 | 0 |
Short-term investments | 62 | 42 |
Cash and cash equivalents | 0 | 0 |
Other invested assets | 272 | 621 |
Deposit asset | 0 | 0 |
Reinsurance recoverables | 0 | 0 |
Net modified coinsurance receivable | 0 | |
Subtotal excluding separate account assets | 5,164 | 5,350 |
Separate account assets, at fair value | 23,985 | 23,601 |
Total assets | 29,149 | 28,951 |
Liabilities: | ||
Insurance liabilities, at fair value | 0 | 0 |
Other liabilities | 513 | 1,076 |
Net modified coinsurance payable | 0 | |
Separate account liabilities, at fair value | 23,985 | 23,601 |
Total liabilities | 24,498 | 24,677 |
Recurring | Level 2 | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 3,405 | 3,279 |
Mortgage and other loans | 0 | 0 |
Short-term investments | 0 | 3 |
Cash and cash equivalents | 0 | 0 |
Other invested assets | 78 | 386 |
Subtotal excluding separate account assets | 3,483 | 3,668 |
Separate account assets, at fair value | 21,909 | 21,558 |
Total assets | 25,392 | 25,226 |
Liabilities: | ||
Insurance liabilities, at fair value | 0 | 0 |
Other liabilities | 265 | 602 |
Separate account liabilities, at fair value | 21,909 | 21,558 |
Total liabilities | 22,174 | 22,160 |
Recurring | Level 2 | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 1,425 | 1,408 |
Equity securities | 0 | 0 |
Short-term investments | 62 | 39 |
Cash and cash equivalents | 0 | 0 |
Other invested assets | 194 | 235 |
Deposit asset | 0 | 0 |
Reinsurance recoverables | 0 | 0 |
Net modified coinsurance receivable | 0 | |
Subtotal excluding separate account assets | 1,681 | 1,682 |
Separate account assets, at fair value | 2,076 | 2,043 |
Total assets | 3,757 | 3,725 |
Liabilities: | ||
Insurance liabilities, at fair value | 0 | 0 |
Other liabilities | 248 | 473 |
Separate account liabilities, at fair value | 2,076 | 2,043 |
Total liabilities | 2,324 | 2,516 |
Recurring | Level 2 | U.S Treasury securities and obligations of U.S. government authorities and agencies | ||
Fixed maturity securities | ||
Asset-backed securities | 587 | 696 |
Recurring | Level 2 | U.S Treasury securities and obligations of U.S. government authorities and agencies | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 513 | 582 |
Recurring | Level 2 | U.S Treasury securities and obligations of U.S. government authorities and agencies | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 74 | 114 |
Recurring | Level 2 | Obligations of U.S. states and their political subdivisions | ||
Fixed maturity securities | ||
Asset-backed securities | 175 | 166 |
Recurring | Level 2 | Obligations of U.S. states and their political subdivisions | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 145 | 136 |
Recurring | Level 2 | Obligations of U.S. states and their political subdivisions | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 30 | 30 |
Recurring | Level 2 | Foreign government bonds | ||
Fixed maturity securities | ||
Asset-backed securities | 5 | 5 |
Recurring | Level 2 | Foreign government bonds | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 5 | 5 |
Recurring | Level 2 | U.S. corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 2,903 | 2,796 |
Recurring | Level 2 | U.S. corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 2,090 | 2,018 |
Recurring | Level 2 | U.S. corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 813 | 778 |
Recurring | Level 2 | U.S. corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 147 | 144 |
Recurring | Level 2 | U.S. corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 2 | U.S. corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 147 | 144 |
Recurring | Level 2 | Foreign corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 217 | 211 |
Recurring | Level 2 | Foreign corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 127 | 122 |
Recurring | Level 2 | Foreign corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 90 | 89 |
Recurring | Level 2 | Foreign corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 33 | 31 |
Recurring | Level 2 | Foreign corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 2 | Foreign corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 33 | 31 |
Recurring | Level 2 | Asset-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 478 | 377 |
Recurring | Level 2 | Asset-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 459 | 358 |
Recurring | Level 2 | Asset-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 19 | 19 |
Recurring | Level 2 | Commercial mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 42 | 43 |
Recurring | Level 2 | Commercial mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 42 | 43 |
Recurring | Level 2 | Commercial mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | |
Recurring | Level 2 | Residential mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 243 | 218 |
Recurring | Level 2 | Residential mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 29 | 20 |
Recurring | Level 2 | Residential mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 214 | 198 |
Recurring | Level 3 | ||
Fixed maturity securities | ||
Asset-backed securities | 409 | 337 |
Equity securities | 0 | 0 |
Mortgage and other loans | 206 | 196 |
Short-term investments | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Other invested assets | 0 | 0 |
Deposit asset | 608 | 607 |
Reinsurance recoverables | 247 | 235 |
Net modified coinsurance receivable | 18 | |
Subtotal excluding separate account assets | 1,470 | 1,393 |
Separate account assets, at fair value | 0 | 0 |
Total assets | 1,470 | 1,393 |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751 | 5,546 |
Other liabilities | 0 | 0 |
Net modified coinsurance payable | 45 | |
Separate account liabilities, at fair value | 0 | 0 |
Total liabilities | 5,796 | 5,546 |
Recurring | Level 3 | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 409 | 337 |
Mortgage and other loans | 206 | 196 |
Short-term investments | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Other invested assets | 0 | 0 |
Subtotal excluding separate account assets | 615 | 533 |
Separate account assets, at fair value | 0 | 0 |
Total assets | 615 | 533 |
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Other liabilities | 0 | 0 |
Separate account liabilities, at fair value | 0 | 0 |
Total liabilities | 3,056 | 2,941 |
Recurring | Level 3 | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Equity securities | 0 | 0 |
Short-term investments | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Other invested assets | 0 | 0 |
Deposit asset | 608 | 607 |
Reinsurance recoverables | 247 | 235 |
Net modified coinsurance receivable | 18 | |
Subtotal excluding separate account assets | 855 | 860 |
Separate account assets, at fair value | 0 | 0 |
Total assets | 855 | 860 |
Liabilities: | ||
Insurance liabilities, at fair value | 2,695 | 2,605 |
Other liabilities | 0 | 0 |
Separate account liabilities, at fair value | 0 | 0 |
Total liabilities | 2,740 | 2,605 |
Recurring | Level 3 | U.S Treasury securities and obligations of U.S. government authorities and agencies | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | U.S Treasury securities and obligations of U.S. government authorities and agencies | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | U.S Treasury securities and obligations of U.S. government authorities and agencies | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Obligations of U.S. states and their political subdivisions | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Obligations of U.S. states and their political subdivisions | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Obligations of U.S. states and their political subdivisions | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Foreign government bonds | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Foreign government bonds | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | U.S. corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | U.S. corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | U.S. corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | U.S. corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 182 | 146 |
Recurring | Level 3 | U.S. corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 182 | 146 |
Recurring | Level 3 | U.S. corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Foreign corporate public securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Foreign corporate public securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Foreign corporate public securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Foreign corporate private securities | ||
Fixed maturity securities | ||
Asset-backed securities | 36 | 36 |
Recurring | Level 3 | Foreign corporate private securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 36 | 36 |
Recurring | Level 3 | Foreign corporate private securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Asset-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 191 | 155 |
Recurring | Level 3 | Asset-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 191 | 155 |
Recurring | Level 3 | Asset-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Commercial mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Commercial mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Commercial mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | |
Recurring | Level 3 | Residential mortgage-backed securities | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Residential mortgage-backed securities | Retained Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Level 3 | Residential mortgage-backed securities | Ceded Business | ||
Fixed maturity securities | ||
Asset-backed securities | 0 | 0 |
Recurring | Fair Value Measured at Net Asset Value Per Share | ||
Liabilities: | ||
Other invested assets excluded from fair value hierarchy | 353 | 345 |
Recurring | Fair Value Measured at Net Asset Value Per Share | Retained Business | ||
Liabilities: | ||
Other invested assets excluded from fair value hierarchy | 352 | 344 |
Recurring | Fair Value Measured at Net Asset Value Per Share | Ceded Business | ||
Liabilities: | ||
Other invested assets excluded from fair value hierarchy | 1 | 1 |
Policy loans | Recurring | ||
Fixed maturity securities | ||
Other invested assets, Netting | (198) | (582) |
Subtotal excluding separate account assets | 198 | 582 |
Policy loans | Recurring | Retained Business | ||
Fixed maturity securities | ||
Other invested assets, Netting | (4) | (347) |
Subtotal excluding separate account assets | 4 | 347 |
Policy loans | Recurring | Ceded Business | ||
Fixed maturity securities | ||
Other invested assets, Netting | (194) | (235) |
Subtotal excluding separate account assets | 194 | 235 |
Other liabilities - derivatives | Recurring | ||
Liabilities: | ||
Liabilities, Netting | (459) | (875) |
Other liabilities - derivatives | Recurring | Retained Business | ||
Liabilities: | ||
Liabilities, Netting | (265) | (602) |
Other liabilities - derivatives | Recurring | Ceded Business | ||
Liabilities: | ||
Liabilities, Netting | $ (194) | $ (272) |
FAIR VALUE OF ASSETS AND LIAB_4
FAIR VALUE OF ASSETS AND LIABILITIES - Quantitative Information Regarding Internally-Prices Level 3 Assets and Liabilities (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Assets | ||
Debt securities, available-for-sale | $ 5,239 | $ 5,024 |
Deposit asset | 608 | 607 |
Net modified coinsurance receivable | 0 | 18 |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751 | 5,546 |
Net modified coinsurance payable | 45 | 0 |
Retained Business | ||
Assets | ||
Net modified coinsurance receivable | 0 | |
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Ceded Business | ||
Assets | ||
Net modified coinsurance receivable | 18 | |
Liabilities: | ||
Insurance liabilities, at fair value | $ 2,695 | $ 2,605 |
Level 3 | Minimum | ||
Liabilities: | ||
Policyholder age | 45 years | |
Level 3 | Minimum | Mortality rate | ||
Liabilities: | ||
Insurance liability, measurement input | 0 | |
Level 3 | Maximum | ||
Liabilities: | ||
Policyholder age | 90 years | |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Equality volatility curve | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.195 | 0.195 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Equality volatility curve | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.195 | 0.195 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Lapse rate | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.01 | 0.01 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Lapse rate | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.01 | 0.01 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Spread over risk free | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0 | 0 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Spread over risk free | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0 | 0 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Utilization rate | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.77 | 0.925 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Utilization rate | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.77 | 0.925 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Mortality rate | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0 | 0 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Mortality rate | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0 | 0 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Corporate Securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0488 | 0.0475 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Foreign corporate public securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0434 | 0.0433 |
Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Asset-backed securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0683 | 0.0719 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Equality volatility curve | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.26 | 0.26 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Equality volatility curve | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.26 | 0.26 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Lapse rate | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.20 | 0.20 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Lapse rate | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.20 | 0.20 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Spread over risk free | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.0248 | 0.0243 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Spread over risk free | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.0207 | 0.0221 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Utilization rate | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 1 | 1 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Utilization rate | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 1 | 1 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Mortality rate | Retained Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.16 | 0.16 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Mortality rate | Ceded Business | ||
Liabilities: | ||
Insurance liability, measurement input | 0.16 | 0.16 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Corporate Securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0919 | 0.0803 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Foreign corporate public securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0642 | 0.0638 |
Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Asset-backed securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0864 | 0.0851 |
Level 3 | Valuation Technique, Discounted Cash Flow | Weighted Average | Corporate Securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0665 | 0.0656 |
Level 3 | Valuation Technique, Discounted Cash Flow | Weighted Average | Foreign corporate public securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0538 | 0.0536 |
Level 3 | Valuation Technique, Discounted Cash Flow | Weighted Average | Asset-backed securities | Discount rate | ||
Assets | ||
Debt securities, measurement input | 0.0805 | 0.0794 |
Level 3 | Valuation Technique, Level Yield | Minimum | Residential mortgage loans | Market yield | ||
Assets | ||
Loans receivable, measurement input | 0.0676 | 0.0575 |
Level 3 | Valuation Technique, Level Yield | Maximum | Residential mortgage loans | Market yield | ||
Assets | ||
Loans receivable, measurement input | 0.1003 | 0.0997 |
Level 3 | Valuation Technique, Level Yield | Weighted Average | Residential mortgage loans | Market yield | ||
Assets | ||
Loans receivable, measurement input | 0.0847 | 0.0840 |
Recurring | ||
Assets | ||
Debt securities, available-for-sale | $ 5,239 | $ 5,024 |
Mortgage and other loans | 206 | 196 |
Deposit asset | 608 | 607 |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751 | 5,546 |
Net modified coinsurance payable | 45 | |
Recurring | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 3,814 | 3,616 |
Mortgage and other loans | 206 | 196 |
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Recurring | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 1,425 | 1,408 |
Deposit asset | 608 | 607 |
Liabilities: | ||
Insurance liabilities, at fair value | 2,695 | 2,605 |
Recurring | Foreign corporate public securities | ||
Assets | ||
Debt securities, available-for-sale | 217 | 211 |
Recurring | Foreign corporate public securities | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 127 | 122 |
Recurring | Foreign corporate public securities | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 90 | 89 |
Recurring | Asset-backed securities | ||
Assets | ||
Debt securities, available-for-sale | 669 | 532 |
Recurring | Asset-backed securities | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 650 | 513 |
Recurring | Asset-backed securities | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 19 | 19 |
Recurring | Commercial mortgage-backed securities | ||
Assets | ||
Debt securities, available-for-sale | 42 | 43 |
Recurring | Commercial mortgage-backed securities | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 42 | 43 |
Recurring | Commercial mortgage-backed securities | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | |
Recurring | Level 3 | ||
Assets | ||
Debt securities, available-for-sale | 409 | 337 |
Mortgage and other loans | 206 | 196 |
Deposit asset | 608 | 607 |
Net modified coinsurance receivable | 18 | |
Liabilities: | ||
Insurance liabilities, at fair value | 5,751 | 5,546 |
Net modified coinsurance payable | 45 | |
Recurring | Level 3 | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 409 | 337 |
Mortgage and other loans | 206 | 196 |
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Recurring | Level 3 | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Deposit asset | 608 | 607 |
Liabilities: | ||
Insurance liabilities, at fair value | 2,695 | 2,605 |
Recurring | Level 3 | Corporate Securities | ||
Assets | ||
Debt securities, available-for-sale | 182 | |
Recurring | Level 3 | Foreign corporate public securities | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Recurring | Level 3 | Foreign corporate public securities | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Recurring | Level 3 | Foreign corporate public securities | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Recurring | Level 3 | Asset-backed securities | ||
Assets | ||
Debt securities, available-for-sale | 191 | 155 |
Recurring | Level 3 | Asset-backed securities | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 191 | 155 |
Recurring | Level 3 | Asset-backed securities | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Recurring | Level 3 | Commercial mortgage-backed securities | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Recurring | Level 3 | Commercial mortgage-backed securities | Retained Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | 0 |
Recurring | Level 3 | Commercial mortgage-backed securities | Ceded Business | ||
Assets | ||
Debt securities, available-for-sale | 0 | |
Recurring | Level 3 | Reinsurance recoverables | ||
Assets | ||
Reinsurance recoverables | 247 | 235 |
Recurring | Level 3 | Policyholders' account balances | ||
Liabilities: | ||
Net modified coinsurance payable | 45 | |
Recurring | Level 3 | Valuation, market approach | Corporate Securities | ||
Assets | ||
Debt securities, available-for-sale | 28 | |
Recurring | Level 3 | Valuation, market approach | Asset-backed securities | ||
Assets | ||
Debt securities, available-for-sale | 112 | |
Recurring | Level 3 | Valuation, market approach | Commercial mortgage-backed securities | ||
Assets | ||
Mortgage and other loans | 48 | 35 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Retained Business | ||
Liabilities: | ||
Insurance liabilities, at fair value | 3,056 | 2,941 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Ceded Business | ||
Liabilities: | ||
Insurance liabilities, at fair value | 2,695 | 2,605 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Corporate Securities | ||
Assets | ||
Debt securities, available-for-sale | 154 | 146 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Foreign corporate public securities | ||
Assets | ||
Debt securities, available-for-sale | 36 | 36 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Asset-backed securities | ||
Assets | ||
Debt securities, available-for-sale | $ 79 | $ 155 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Minimum | Measurement Input, Withdrawal Rate | ||
Liabilities: | ||
Insurance liability, measurement input | 0.77 | 0.77 |
Recurring | Level 3 | Valuation Technique, Discounted Cash Flow | Maximum | Measurement Input, Withdrawal Rate | ||
Liabilities: | ||
Insurance liability, measurement input | 1 | 1 |
Recurring | Level 3 | Valuation Technique, Level Yield | Residential mortgage loans | ||
Assets | ||
Mortgage and other loans | $ 158 | $ 161 |
FAIR VALUE OF ASSETS AND LIAB_5
FAIR VALUE OF ASSETS AND LIABILITIES - Changes in Level 3 Assets and Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Future policy benefits | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | $ 4,060 | $ 4,060 | |
Total realized and unrealized gains (losses) | 715 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | (48) | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 3,393 | ||
Unrealized gains (losses) for liabilities still held | 686 | ||
Policyholders' account balances | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 2,041 | 2,041 | |
Total realized and unrealized gains (losses) | 124 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | (17) | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 1,934 | ||
Unrealized gains (losses) for liabilities still held | 89 | ||
Insurance Liabilities | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Total realized and unrealized gains (losses) | $ 205 | (8,065) | |
Insurance Liabilities | Retained Business | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 2,941 | ||
Total realized and unrealized gains (losses) | 115 | (421) | |
Reduction in estimates of ultimate losses | (348) | ||
Increase in estimates of ultimate losses | 132 | ||
Change in fair value (discount rate) | 235 | ||
Paid losses | 100 | ||
Other | (4) | ||
Fair Value, end of period | 3,056 | 2,941 | |
Insurance Liabilities | Ceded Business | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 2,605 | ||
Total realized and unrealized gains (losses) | 90 | (7,644) | |
Reduction in estimates of ultimate losses | (66) | ||
Increase in estimates of ultimate losses | 67 | ||
Change in fair value (discount rate) | 76 | ||
Paid losses | 13 | ||
Other | 0 | ||
Fair Value, end of period | 2,695 | 2,605 | |
Residential mortgage loans | Retained Business | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 161 | ||
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 13 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | (16) | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 158 | 161 | |
Unrealized gains (losses) for assets still held | 0 | ||
Commercial mortgage-backed securities | Retained Business | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 35 | ||
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 13 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 48 | 35 | |
Unrealized gains (losses) for assets still held | 0 | ||
Short term investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 13 | 13 | |
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | (13) | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 0 | ||
Unrealized gains (losses) for assets still held | 0 | ||
Cash equivalents | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 8 | 8 | |
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | (8) | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 0 | ||
Unrealized gains (losses) for assets still held | 0 | ||
Other assets | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 400 | 400 | |
Total realized and unrealized gains (losses) | (21) | ||
Purchases | 13 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | (16) | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 376 | ||
Unrealized gains (losses) for assets still held | (6) | ||
Deposit asset | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 607 | ||
Total realized and unrealized gains (losses) | 1 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 608 | 607 | |
Unrealized gains (losses) for assets still held | 0 | ||
Reinsurance recoverables | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 235 | 1,881 | 1,881 |
Total realized and unrealized gains (losses) | 12 | 201 | |
Purchases | 0 | 4 | |
Sales | 0 | 0 | |
Issuances | 0 | 0 | |
Settlements | 0 | 19 | |
Other | 0 | (239) | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 0 | 0 | |
Fair Value, end of period | 247 | 1,866 | 235 |
Unrealized gains (losses) for assets still held | 0 | 222 | |
Net Modified Coinsurance Receivable (Payable) | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 18 | ||
Total realized and unrealized gains (losses) | (63) | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | (45) | 18 | |
Unrealized gains (losses) for assets still held | 0 | ||
Fixed maturity securities | U.S Treasury securities and obligations of U.S. government authorities and agencies | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 0 | 0 | |
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 0 | ||
Unrealized gains (losses) for assets still held | 0 | ||
Fixed maturity securities | Corporate Securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 146 | 190 | 190 |
Total realized and unrealized gains (losses) | 0 | (9) | |
Purchases | 19 | 5 | |
Sales | 0 | (4) | |
Issuances | 0 | 0 | |
Settlements | (1) | (2) | |
Other | 0 | 0 | |
Transfers into Level 3 | 0 | 0 | |
Transfers out of Level 3 | 18 | 0 | |
Fair Value, end of period | 182 | 180 | 146 |
Unrealized gains (losses) for assets still held | 0 | (9) | |
Fixed maturity securities | Structured securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 76 | 76 | |
Total realized and unrealized gains (losses) | (4) | ||
Purchases | 0 | ||
Sales | (10) | ||
Issuances | 0 | ||
Settlements | (2) | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | (13) | ||
Fair Value, end of period | 47 | ||
Unrealized gains (losses) for assets still held | (4) | ||
Fixed maturity securities | Foreign corporate private securities | Retained Business | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 36 | ||
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 36 | 36 | |
Unrealized gains (losses) for assets still held | 1 | ||
Fixed maturity securities | Asset-backed securities | Retained Business | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 155 | ||
Total realized and unrealized gains (losses) | (2) | ||
Purchases | 38 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 191 | 155 | |
Unrealized gains (losses) for assets still held | $ (2) | ||
Equity securities | Equity securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair Value, beginning of period | 1 | $ 1 | |
Total realized and unrealized gains (losses) | 0 | ||
Purchases | 0 | ||
Sales | 0 | ||
Issuances | 0 | ||
Settlements | 0 | ||
Other | 0 | ||
Transfers into Level 3 | 0 | ||
Transfers out of Level 3 | 0 | ||
Fair Value, end of period | 1 | ||
Unrealized gains (losses) for assets still held | $ 0 |
FAIR VALUE OF ASSETS AND LIAB_6
FAIR VALUE OF ASSETS AND LIABILITIES - Gains and Losses Resulting from Changes in Fair Value (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Future policy benefits | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | $ 715 | |
Unrealized gains (losses) for liabilities still held | 686 | |
Policyholders' account balances | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 124 | |
Unrealized gains (losses) for liabilities still held | 89 | |
Realized investment gains (losses), net | Future policy benefits | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 715 | |
Unrealized gains (losses) for liabilities still held | 686 | |
Realized investment gains (losses), net | Policyholders' account balances | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 124 | |
Unrealized gains (losses) for liabilities still held | 89 | |
Other income (loss) | Future policy benefits | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for liabilities still held | 0 | |
Other income (loss) | Policyholders' account balances | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for liabilities still held | 0 | |
Included in other comprehensive income (loss) | Future policy benefits | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for liabilities still held | 0 | |
Included in other comprehensive income (loss) | Policyholders' account balances | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for liabilities still held | 0 | |
Net investment income | Future policy benefits | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Net investment income | Policyholders' account balances | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Fixed maturity securities | Realized investment gains (losses), net | Fixed Maturity, Available-For Sale | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for assets still held | 0 | |
Fixed maturity securities | Other income (loss) | Fixed Maturity, Available-For Sale | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for assets still held | 0 | |
Fixed maturity securities | Included in other comprehensive income (loss) | Fixed Maturity, Available-For Sale | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | (12) | |
Unrealized gains (losses) for assets still held | (12) | |
Fixed maturity securities | Net investment income | Fixed Maturity, Available-For Sale | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Other assets | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | (21) | |
Unrealized gains (losses) for assets still held | (6) | |
Other assets | Realized investment gains (losses), net | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | (21) | |
Unrealized gains (losses) for assets still held | (6) | |
Other assets | Other income (loss) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for assets still held | 0 | |
Other assets | Included in other comprehensive income (loss) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for assets still held | 0 | |
Other assets | Net investment income | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Reinsurance recoverables | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | $ 12 | 201 |
Unrealized gains (losses) for assets still held | $ 0 | 222 |
Reinsurance recoverables | Realized investment gains (losses), net | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 201 | |
Unrealized gains (losses) for assets still held | 222 | |
Reinsurance recoverables | Other income (loss) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for assets still held | 0 | |
Reinsurance recoverables | Included in other comprehensive income (loss) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | 0 | |
Unrealized gains (losses) for assets still held | 0 | |
Reinsurance recoverables | Net investment income | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Total realized and unrealized gains (losses) | $ 0 |
FAIR VALUE OF ASSETS AND LIAB_7
FAIR VALUE OF ASSETS AND LIABILITIES - Changes in Fair Value of Insurance Contracts (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Insurance Liabilities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, liabilities | $ 205 | $ (8,065) |
Insurance Liabilities | Retained Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, liabilities | 115 | (421) |
Insurance Liabilities | Ceded Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, liabilities | 90 | (7,644) |
Reinsurance recoverables | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 12 | (15) |
Reinsurance recoverables | Retained Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 0 | 0 |
Reinsurance recoverables | Ceded Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 12 | (15) |
Modified coinsurance receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 78 | (5,640) |
Modified coinsurance receivable | Retained Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 0 | 0 |
Modified coinsurance receivable | Ceded Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 78 | (5,640) |
Deposit asset | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 1 | (1,989) |
Deposit asset | Retained Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | 0 | 0 |
Deposit asset | Ceded Business | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of insurance contracts, assets | $ 1 | $ (1,989) |
FAIR VALUE OF ASSETS AND LIAB_8
FAIR VALUE OF ASSETS AND LIABILITIES - Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Accrued investment income | $ 53 | $ 52 |
Fair Value | Fair Value, Inputs, Level 1, Level 2, and Level 3 | ||
Assets | ||
Accrued investment income | 53 | 52 |
Mortgage and other loans | 11 | 11 |
Liabilities: | ||
Repurchase agreements | 301 | 311 |
Cash collateral for loaned securities | 164 | 106 |
Fair Value | Level 1 | ||
Assets | ||
Accrued investment income | 0 | 0 |
Mortgage and other loans | 0 | 0 |
Liabilities: | ||
Repurchase agreements | 0 | 0 |
Cash collateral for loaned securities | 0 | 0 |
Fair Value | Level 2 | ||
Assets | ||
Accrued investment income | 53 | 52 |
Mortgage and other loans | 0 | 0 |
Liabilities: | ||
Repurchase agreements | 301 | 311 |
Cash collateral for loaned securities | 164 | 106 |
Fair Value | Level 3 | ||
Assets | ||
Accrued investment income | 0 | 0 |
Mortgage and other loans | 11 | 11 |
Liabilities: | ||
Repurchase agreements | 0 | 0 |
Cash collateral for loaned securities | 0 | 0 |
Carrying Amount | ||
Assets | ||
Accrued investment income | 53 | 52 |
Mortgage and other loans | 11 | 11 |
Liabilities: | ||
Repurchase agreements | 301 | 311 |
Cash collateral for loaned securities | $ 164 | $ 106 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |||
Income tax expense | $ 0.3 | $ 77 | $ 77 |
Effective income tax rate reconciliation | 4.30% | 17.80% | |
Deferred tax assets, valuation allowance | $ 37 |
EQUITY - Narrative (Details)
EQUITY - Narrative (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2023 | Dec. 31, 2022 | Apr. 01, 2022 | |
Equity [Abstract] | |||
Distribution payable to parent | $ 45,000,000 | ||
Accumulated other comprehensive income | $ 128,000,000 | $ 111,000,000 | $ 0 |
EQUITY - Components of AOCI (De
EQUITY - Components of AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
AOCI | |||
Beginning Balance | $ 1,587 | $ 1,682 | |
Less: Income tax expense | (5) | $ 118 | |
Ending Balance | 1,566 | 1,289 | |
Changes in Own-Credit Risk Related to Insurance Liabilities | |||
AOCI | |||
Beginning Balance | 111 | ||
Change in OCI | 22 | ||
Less: Income tax expense | 5 | ||
Ending Balance | $ 128 | ||
Foreign Currency Translation Adjustment | |||
AOCI | |||
Beginning Balance | (1) | ||
Change in OCI | 0 | ||
Amounts reclassified from AOCI | 0 | ||
Less: Income tax expense | 0 | ||
Ending Balance | (1) | ||
Net Unrealized Investment Gains (Losses) | |||
AOCI | |||
Beginning Balance | 171 | ||
Change in OCI | (576) | ||
Amounts reclassified from AOCI | 15 | ||
Less: Income tax expense | 118 | ||
Ending Balance | (272) | ||
Total Accumulated Other Comprehensive Income (Loss) | |||
AOCI | |||
Beginning Balance | 170 | ||
Change in OCI | (576) | ||
Amounts reclassified from AOCI | 15 | ||
Less: Income tax expense | 118 | ||
Ending Balance | (273) | ||
Accumulated Gain (Loss), Cash Flow Hedge, Including Noncontrolling Interest | |||
AOCI | |||
Ending Balance | $ 29 |
EQUITY - Reclassification out o
EQUITY - Reclassification out of Accumulated Other Comprehensive Income (Details) - Reclassification out of Accumulated Other Comprehensive Income $ in Millions | 3 Months Ended |
Mar. 31, 2022 USD ($) | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |
Income (loss) including portion attributable to noncontrolling interest, before tax | $ (15) |
Total Accumulated Other Comprehensive Income (Loss) | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |
Income (loss) including portion attributable to noncontrolling interest, before tax | (15) |
Cash flow hedges - Currency/Interest rate | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |
Income (loss) including portion attributable to noncontrolling interest, before tax | 5 |
Net unrealized investment losses on available-for-sale securities | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |
Income (loss) including portion attributable to noncontrolling interest, before tax | $ (20) |
EQUITY - Other Net Unrealized I
EQUITY - Other Net Unrealized Investment Gain Loss AOCI (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022 USD ($) | |
AOCI | |
Beginning Balance | $ 1,682 |
Ending Balance | 1,289 |
Net Unrealized Investment Gains Losses On All Other Investments | |
AOCI | |
Beginning Balance | 240 |
Net investment gains (losses) on investments arising during the period | (591) |
Reclassification adjustment for (gains) losses included in net income | 15 |
Impact of net unrealized investment (gains) losses | 0 |
Ending Balance | (336) |
DAC and Other Costs | |
AOCI | |
Beginning Balance | (15) |
Net investment gains (losses) on investments arising during the period | 0 |
Reclassification adjustment for (gains) losses included in net income | 0 |
Impact of net unrealized investment (gains) losses | 9 |
Ending Balance | (6) |
Future Policy Benefits and Other Liabilities | |
AOCI | |
Beginning Balance | (7) |
Net investment gains (losses) on investments arising during the period | 0 |
Reclassification adjustment for (gains) losses included in net income | 0 |
Impact of net unrealized investment (gains) losses | 6 |
Ending Balance | (1) |
Income Tax Benefit (Expense) | |
AOCI | |
Beginning Balance | (47) |
Net investment gains (losses) on investments arising during the period | 125 |
Reclassification adjustment for (gains) losses included in net income | (4) |
Impact of net unrealized investment (gains) losses | (3) |
Ending Balance | 71 |
Accumulated Other Comprehensive Income (Loss) Related To Net Unrealized Investment Gains (Losses) | |
AOCI | |
Beginning Balance | 171 |
Net investment gains (losses) on investments arising during the period | (466) |
Reclassification adjustment for (gains) losses included in net income | 11 |
Impact of net unrealized investment (gains) losses | 12 |
Ending Balance | $ (272) |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Details) - Commitments $ in Millions | Mar. 31, 2023 USD ($) |
Mortgage and other loans | |
Other Commitments [Line Items] | |
Commitments to fund underlying commercial mortgage loans | $ 128 |
Investments | |
Other Commitments [Line Items] | |
Purchase obligation | $ 478 |
RELATED PARTY TRANSACTIONS - Su
RELATED PARTY TRANSACTIONS - Successor Company (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2022 | Apr. 01, 2022 | |
Related Party Transaction [Line Items] | |||||
Intercompany liquidity agreement, maximum borrowing capacity | $ 300 | ||||
Intercompany liquidity agreement, outstanding | 120 | ||||
Net investment income | 76 | $ 99 | $ 99 | ||
Funding commitment | 249 | ||||
Fortitude Group Holdings | |||||
Related Party Transaction [Line Items] | |||||
Allocation of costs | 8 | ||||
Carlyle Investment Management L.L.C. | |||||
Related Party Transaction [Line Items] | |||||
Assets under management, market value | 754 | $ 732 | |||
Net investment income | $ 5 | ||||
Fortitude Group Holdings | Carlyle Investment Management L.L.C. | |||||
Related Party Transaction [Line Items] | |||||
Ownership | 71.30% |
RELATED PARTY TRANSACTIONS - Pr
RELATED PARTY TRANSACTIONS - Predecessor Company (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
Related Party Transaction [Line Items] | ||||
Policy charges and fee income | $ 117 | $ 97 | $ 97 | |
Investment management expenses | $ 11 | 4 | ||
Income | 20 | |||
Prudential Annuities Inc. | ||||
Related Party Transaction [Line Items] | ||||
Return of capital | $ 306 | |||
Affiliated Entity | Prudential Annuities Distributors | ||||
Related Party Transaction [Line Items] | ||||
Policy charges and fee income | 29 | |||
Affiliated Entity | P G I M | ||||
Related Party Transaction [Line Items] | ||||
Investment management expenses | 4 | |||
Affiliated Entity | ASTISI And PGIM Investments | ||||
Related Party Transaction [Line Items] | ||||
Income | 22 | |||
Parent Company | ||||
Related Party Transaction [Line Items] | ||||
Corporate expenses | $ 9 |
RELATED PARTY TRANSACTIONS - Sc
RELATED PARTY TRANSACTIONS - Schedule of Affiliated Asset Transfers (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
Related Party Transaction [Line Items] | |||
Investment gains, net | $ 165 | $ 481 | $ 481 |
Affiliated Entity | Pruco Life | |||
Related Party Transaction [Line Items] | |||
Asset Transfer Fair Value | 4 | ||
Asset Transfer Amortized Cost | 5 | ||
Investment gains, net | (1) | ||
Affiliated Entity | Prudential Financial | |||
Related Party Transaction [Line Items] | |||
Asset Transfer Fair Value | 29 | ||
Asset Transfer Amortized Cost | 30 | ||
Investment gains, net | (1) | ||
Affiliated Entity | Pruco Life | |||
Related Party Transaction [Line Items] | |||
Asset Transfer Fair Value | 0 | ||
Asset Transfer Amortized Cost | 0 | ||
Investment gains, net | 0 | ||
Affiliated Entity | Pruco Life | |||
Related Party Transaction [Line Items] | |||
Asset Transfer Fair Value | 129 | ||
Asset Transfer Amortized Cost | 138 | ||
Investment gains, net | (9) | ||
Affiliated Entity | Prudential Financial | |||
Related Party Transaction [Line Items] | |||
Asset Transfer Fair Value | 33 | ||
Asset Transfer Amortized Cost | 33 | ||
Investment gains, net | $ 0 |
RELATED PARTY TRANSACTIONS - _2
RELATED PARTY TRANSACTIONS - Schedule of Reinsurance Impact on Statement of Operations and Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Sep. 30, 2022 | Mar. 31, 2022 | |
Premiums: | |||
Direct | $ 9 | ||
Ceded | (1) | ||
Net premiums | $ 7 | $ 8 | 8 |
Policy charges and fee income: | |||
Direct | 102 | ||
Ceded | (5) | ||
Policy charges and fee income | 117 | 97 | 97 |
Asset management and service fees: | |||
Direct | 22 | ||
Ceded | (2) | ||
Net asset management and service fees | 20 | ||
Realized investment gains (losses), net: | |||
Direct | 312 | ||
Ceded | 169 | ||
Investment gains, net | 165 | 481 | 481 |
Policyholders' benefits (including change in reserves): | |||
Direct | 31 | ||
Ceded | (5) | ||
Policyholder benefits | 26 | 26 | |
Interest credited to policyholders’ account balances: | |||
Direct | 91 | ||
Ceded | (6) | ||
Interest credited to policyholders’ account balances | $ 0 | $ 85 | 85 |
Net interest credited to policyholders’ account balances | $ (41) |