Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2021

Schedule Of Positions in Derivative Instruments

The following table sets forth our positions in derivative instruments as of the dates indicated:

	Derivative assets					Derivative liabilities
	Balance sheet classification	Fair value				Balance sheet classification		Fair value
		March 31, 2021		December 31, 2020				March 31, 2021		December 31, 2020
(Amounts in millions)
Derivatives designated as hedges
Cash flow hedges:
Interest rate swaps	Other invested assets	$	84	$	468		Other liabilities	$	170	$	23
Foreign currency swaps	Other invested assets		—		1		Other liabilities		3		2
Total cash flow hedges			84		469				173		25
Total derivatives designated as hedges			84		469				173		25
Derivatives not designated as hedges
Equity index options	Other invested assets		53		63		Other liabilities		—		—
Financial futures	Other invested assets		—		—		Other liabilities		—		—
Other foreign currency contracts	Other invested assets		27		42		Other liabilities		—		1
GMWB embedded derivatives	Reinsurance recoverable (1)		18		26		Policyholder account balances (2)		272		379
Fixed index annuity embedded derivatives	Other assets		—		—		Policyholder account balances (3)		362		399
Indexed universal life embedded derivatives	Reinsurance recoverable		—		—		Policyholder account balances (4)		23		26
Total derivatives not designated as hedges			98		131				657		805
Total derivatives		$	182	$	600			$	830	$	830

(1)  Represents embedded derivatives associated with the reinsured portion of our guaranteed minimum withdrawal benefits (“GMWB”) liabilities.

(2)  Represents the embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance.

(3)  Represents the embedded derivatives associated with our fixed index annuity liabilities.

(4)  Represents the embedded derivatives associated with our indexed universal life liabilities.

Schedule of Notional Amounts Outstanding on Derivative Instruments

The following tables represent activity associated with derivative instruments as of the dates indicated:

			December 31,				Maturities/			March 31,
(Notional in millions)	Measurement		2020		Additions		terminations			2021
Derivatives designated as hedges
Cash flow hedges:
Interest rate swaps		Notional	$	8,178	$	—	$	(52	)	$	8,126
Foreign currency swaps		Notional		127		—		—			127
Total cash flow hedges				8,305		—		(52	)		8,253
Total derivatives designated as hedges				8,305		—		(52	)		8,253
Derivatives not designated as hedges
Interest rate swaps		Notional		4,674		—		—			4,674
Equity index options		Notional		2,000		352		(432	)		1,920
Financial futures		Notional		1,104		1,008		(1,114	)		998
Other foreign currency contracts		Notional		1,186		12		(495	)		703
Total derivatives not designated as hedges				8,964		1,372		(2,041	)		8,295
Total derivatives			$	17,269	$	1,372	$	(2,093	)	$	16,548
			December 31,				Maturities/			March 31,
(Number of policies)	Measurement		2020		Additions		terminations			2021
Derivatives not designated as hedges
GMWB embedded derivatives		Policies		23,713		—		(536	)		23,177
Fixed index annuity embedded derivatives		Policies		12,778		—		(1,010	)		11,768
Indexed universal life embedded derivatives		Policies		842		—		(8	)		834

Schedule of Pre-Tax Income (Loss) Effects of Cash Flow Hedges

The following table provides information about the pre-tax income (loss) effects of cash flow hedges for the three months ended March 31, 2021:

				Gain (loss)
				reclassified into		Classification of gain		Gain (loss)		Classification of gain
	Gain (loss)			net income (loss)		(loss) reclassified into		recognized in		(loss) recognized in
(Amounts in millions)	recognized in OCI			from OCI		net income (loss)		net income (loss)		net income (loss)
Interest rate swaps hedging assets	$	(529	)	$	52		Net investment income	$	—		Net investment gains (losses)
Interest rate swaps hedging liabilities		44			—		Interest expense		—		Net investment gains (losses)
Foreign currency swaps		(2	)		—		Net investment income		—		Net investment gains (losses)
Total	$	(487	)	$	52			$	—

The following table provides information about the pre-tax income (loss) effects of cash flow hedges for the three months ended March 31, 2020:

				Gain (loss)
				reclassified into		Classification of gain		Gain (loss)		Classification of gain
	Gain (loss)			net income (loss)		(loss) reclassified into		recognized in		(loss) recognized in
(Amounts in millions)	recognized in OCI			from OCI		net income (loss)		net income (loss)		net income (loss)
Interest rate swaps hedging assets	$	1,041		$	43		Net investment income	$	—		Net investment gains (losses)
Interest rate swaps hedging assets		—			4		Net investment gains (losses)		—		Net investment gains (losses)
Interest rate swaps hedging liabilities		(63	)		—		Interest expense		—		Net investment gains (losses)
Foreign currency swaps		17			—		Net investment income		—		Net investment gains (losses)
Total	$	995		$	47			$	—

Reconciliation of Current Period Changes, Net of Applicable Income Taxes, for Derivatives Qualifying as Hedge

The following table provides a reconciliation of current period changes, net of applicable income taxes, for these designated derivatives presented in the separate component of stockholders’ equity labeled “derivatives qualifying as hedges,” for the periods indicated:

	Three months ended
	March 31,
(Amounts in millions)	2021			2020
Derivatives qualifying as effective accounting hedges as of January 1	$	2,211		$	2,002
Current period increases (decreases) in fair value, net of deferred taxes of $102 and $(212)		(385	)		783
Reclassification to net (income) loss, net of deferred taxes of $18 and $17		(34	)		(30	)
Derivatives qualifying as effective accounting hedges as of March 31	$	1,792		$	2,755

Schedule of Pre-Tax Gain (Loss) Recognized in Net Income (loss) for Effects of Derivatives Not Designated as Hedges

The following table provides the pre-tax gain (loss) recognized in net income (loss) for the effects of derivatives not designated as hedges for the periods indicated:

	Three months ended March 31,						Classification of gain (loss) recognized
(Amounts in millions)	2021			2020			in net income (loss)
Interest rate swaps	$	4		$	(10	)	Net investment gains (losses)
Equity index options		3			(13	)	Net investment gains (losses)
Financial futures		(110	)		261		Net investment gains (losses)
Other foreign currency contracts		—			10		Net investment gains (losses)
GMWB embedded derivatives		105			(336	)	Net investment gains (losses)
Fixed index annuity embedded derivatives		(4	)		32		Net investment gains (losses)
Indexed universal life embedded derivatives		10			4		Net investment gains (losses)
Total derivatives not designated as hedges	$	8		$	(52	)

Derivative Assets and Liabilities Subject to Master Netting Arrangement

The following table presents additional information about derivative assets and liabilities subject to an enforceable master netting arrangement as of the dates indicated:

	March 31, 2021									December 31, 2020
	Derivative			Derivative			Net			Derivative			Derivative			Net
(Amounts in millions)	assets (1)			liabilities (1)			derivatives			assets (1)			liabilities (1)			derivatives
Amounts presented in the balance sheet:
Gross amounts recognized	$	164		$	173		$	(9	)	$	574		$	26		$	548
Gross amounts offset in the balance sheet		—			—			—			—			—			—
Net amounts presented in the balance sheet		164			173			(9	)		574			26			548
Gross amounts not offset in the balance sheet:
Financial instruments (2)		(50	)		(50	)		—			(20	)		(20	)		—
Collateral received		(110	)		—			(110	)		(401	)		—			(401	)
Collateral pledged		—			(721	)		721			—			(505	)		505
Over collateralization		11			598			(587	)		2			499			(497	)
Net amount	$	15		$	—		$	15		$	155		$	—		$	155

(1)  Does not include amounts related to embedded derivatives as of March 31, 2021 and December 31, 2020.

(2)  Amounts represent derivative assets and/or liabilities that are presented gross within the balance sheet but are held with the same counterparty where we have a master netting arrangement. This adjustment results in presenting the net asset and net liability position for each counterparty.