(13) Market Risk Benefits The following table sets forth our market risk benefits by asset and liability position as of the dates indicated:
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Fixed indexed annuities |
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$ |
— |
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$ |
38 |
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$ |
38 |
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$ |
— |
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$ |
52 |
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$ |
52 |
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Variable annuities |
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39 |
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541 |
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502 |
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26 |
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|
696 |
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670 |
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Total market risk benefits |
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$ |
39 |
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$ |
579 |
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$ |
540 |
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$ |
26 |
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$ |
748 |
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$ |
722 |
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| The following tables present the balances of and changes in market risk benefits as of and for the periods indicated:
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(Dollar amounts in millions) |
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Beginning balance as of January 1 |
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$ |
52 |
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$ |
670 |
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$ |
158 |
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Beginning balance before effect of changes in instrument-specific credit risk |
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$ |
50 |
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$ |
660 |
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$ |
158 |
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Issuances |
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— |
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|
— |
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|
— |
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Interest accrual |
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2 |
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26 |
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|
6 |
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Attributed fees collected |
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3 |
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28 |
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|
6 |
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Benefit payments |
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— |
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(26 |
) |
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(11 |
) |
Effect of changes in interest rates |
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(16 |
) |
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|
(142 |
) |
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(24 |
) |
Effect of changes in equity markets |
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(1 |
) |
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(54 |
) |
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(15 |
) |
Actual policyholder behavior different from expected behavior |
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(2 |
) |
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4 |
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3 |
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Effect of changes in future expected policyholder behavior |
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|
— |
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— |
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— |
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Effect of changes in other future expected assumptions |
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— |
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— |
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— |
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Ending balance before effect of changes in instrument-specific credit risk |
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36 |
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|
496 |
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|
123 |
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Effect of changes in instrument-specific credit risk |
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2 |
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6 |
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— |
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Ending balance as of September 30 |
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38 |
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502 |
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$ |
123 |
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Less: reinsurance recoverable |
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— |
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123 |
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Market risk benefits, net of reinsurance recoverable |
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$ |
38 |
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$ |
379 |
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Weighted-average attained age of contractholders |
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72 |
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76 |
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(1) |
Represents the net reinsured asset related to our variable annuity MRBs. |
(2) |
See note 11 for additional information on the net amount at risk. |
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(Dollar amounts in millions) |
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(1) |
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Beginning balance as of January 1 |
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$ |
94 |
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$ |
855 |
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$ |
193 |
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Beginning balance before effect of changes in instrument-specific credit risk |
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$ |
90 |
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$ |
840 |
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$ |
193 |
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Issuances |
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— |
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6 |
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— |
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Interest accrual |
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1 |
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18 |
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4 |
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Attributed fees collected |
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5 |
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42 |
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9 |
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Benefit payments |
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— |
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(28 |
) |
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(16 |
) |
Effect of changes in interest rates |
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(51 |
) |
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(513 |
) |
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(74 |
) |
Effect of changes in equity markets |
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5 |
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|
286 |
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|
39 |
|
Actual policyholder behavior different from expected behavior |
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(2 |
) |
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8 |
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3 |
|
Effect of changes in future expected policyholder behavior |
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|
— |
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— |
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— |
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Effect of changes in other future expected assumptions |
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— |
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— |
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— |
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Other |
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2 |
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1 |
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— |
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Ending balance before effect of changes in instrument-specific credit risk |
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50 |
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|
660 |
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|
158 |
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Effect of changes in instrument-specific credit risk |
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2 |
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|
10 |
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— |
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Ending balance as of December 31 |
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|
52 |
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|
670 |
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$ |
158 |
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Less: reinsurance recoverable |
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|
— |
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|
158 |
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Market risk benefits, net of reinsurance recoverable |
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$ |
52 |
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$ |
512 |
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Weighted-average attained age of contractholders |
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72 |
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|
76 |
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(1) |
Represents the net reinsured asset related to our variable annuity MRBs. |
(2) |
See note 11 for additional information on the net amount at risk. |
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(Dollar amounts in millions) |
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(1) |
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Beginning balance as of January 1 |
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$ |
115 |
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$ |
1,173 |
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$ |
244 |
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Beginning balance before effect of changes in instrument-specific credit risk |
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$ |
110 |
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$ |
1,154 |
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$ |
244 |
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Issuances |
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|
— |
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|
3 |
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|
— |
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Interest accrual |
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|
— |
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|
4 |
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|
1 |
|
Attributed fees collected |
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|
6 |
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|
48 |
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|
11 |
|
Benefit payments |
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|
— |
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|
(23 |
) |
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(13 |
) |
Effect of changes in interest rates |
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|
(10 |
) |
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|
(115 |
) |
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(21 |
) |
Effect of changes in equity markets |
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|
(7 |
) |
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|
(267 |
) |
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(42 |
) |
Actual policyholder behavior different from expected behavior |
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|
(7 |
) |
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|
36 |
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|
13 |
|
Effect of changes in future expected policyholder behavior |
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|
— |
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|
— |
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|
— |
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Effect of changes in other future expected assumptions |
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|
— |
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|
— |
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|
— |
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Other |
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(2 |
) |
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— |
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— |
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Ending balance before effect of changes in instrument-specific credit risk |
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|
90 |
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|
840 |
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|
193 |
|
Effect of changes in instrument-specific credit risk |
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|
4 |
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|
15 |
|
|
|
— |
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|
Ending balance as of December 31 |
|
|
94 |
|
|
|
855 |
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$ |
193 |
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Less: reinsurance recoverable |
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|
— |
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|
193 |
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Market risk benefits, net of reinsurance recoverable |
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$ |
94 |
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$ |
662 |
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Weighted-average attained age of contractholders |
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71 |
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|
75 |
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(1) |
Represents the net reinsured asset related to our variable annuity MRBs. |
(2) |
See note 11 for additional information on the net amount at risk. | During the year ended December 31, 2022, risk-free interest rates increased, resulting in a decrease in the net MRB liability of our fixed indexed and variable annuity products. In our variable annuity products, this was partially offset by unfavorable equity market performance, which increased our net MRB liability. During the year ended December 31, 2021, equity market performance was favorable and risk-free interest rates increased, resulting in a decrease in our net MRB liability of our fixed indexed and variable annuity products.
|