Investments

6 Months Ended

Jun. 30, 2024

Investments

(4) Investments

(a) Net Investment Income

Sources of net investment income were as follows for the periods indicated:

	Three months ended June 30,						Six months ended June 30,
(Amounts in millions)	2024			2023			2024			2023
Fixed maturity securities—taxable	$	571		$	567		$	1,125		$	1,128
Fixed maturity securities—non-taxable		—			1			1			2
Equity securities		3			3			5			5
Commercial mortgage loans		75			75			150			151
Policy loans		56			54			114			109
Limited partnerships		36			17			56			45
Other invested assets		67			70			135			138
Cash, cash equivalents, restricted cash and short-term investments		25			22			52			40
Gross investment income before expenses and fees		833			809			1,638			1,618
Expenses and fees		(25	)		(24	)		(48	)		(46	)
Net investment income	$	808		$	785		$	1,590		$	1,572

(b) Net Investment Gains (Losses)

The following table sets forth net investment gains (losses) for the periods indicated:

	Three months ended June 30,						Six months ended June 30,
(Amounts in millions)	2024			2023			2024			2023
Realized investment gains (losses):
Available-for-sale fixed maturity securities:
Realized gains	$	21		$	18		$	28		$	21
Realized losses		(40	)		(48	)		(69	)		(67	)
Net realized gains (losses) on available-for-sale fixed maturity securities		(19	)		(30	)		(41	)		(46	)
Net realized gains (losses) on equity securities sold		—			(1	)		—			(1	)
Total net realized investment gains (losses)		(19	)		(31	)		(41	)		(47	)
Net change in allowance for credit losses on available-for-sale fixed maturity securities		7			11			7			(4	)
Write-down of available-for-sale fixed maturity securities (1)		—			(1	)		—			(1	)
Net unrealized gains (losses) on equity securities still held		12			21			44			32
Net unrealized gains (losses) on limited partnerships		(52	)		40			(9	)		40
Commercial mortgage loans		(1	)		—			(3	)		(2	)
Derivative instruments (2)		(8	)		(1	)		(7	)		11
Other		—			—			(3	)		(1	)
Net investment gains (losses)	$	(61	)	$	39		$	(12	)	$	28

(1)  Represents write-down of securities deemed uncollectible or that we intend to sell or will be required to sell prior to recovery of the amortized cost basis.

(2)  See note 5 for additional information on the impact of derivative instruments included in net investment gains (losses).

See Note 2—Summary of Significant Accounting Policies included in the Notes to Consolidated Financial Statements in our 2023 Annual Report on Form 10-K for a discussion of our policy for evaluating and measuring the allowance for credit losses related to our available-for-sale fixed maturity securities.

The following table represents the allowance for credit losses aggregated by security type for available-for-sale fixed maturity securities as of and for the three and six months ended June 30, 2024:

(Amounts in millions)	Beginning balance		Increase from securities without allowance in previous periods		Increase (decrease) from securities with allowance in previous periods		Securities sold			Decrease due to change in intent or requirement to sell		Write-offs		Recoveries		Ending balance
Fixed maturity securities:
Commercial mortgage-backed	$	7	$	—	$	—	$	(7	)	$	—	$	—	$	—	$	—
Total available-for-sale fixed maturity securities	$	7	$	—	$	—	$	(7	)	$	—	$	—	$	—	$	—

The following table represents the allowance for credit losses aggregated by security type for available-for-sale fixed maturity securities as of and for the three months ended June 30, 2023:

(Amounts in millions)	Beginning balance		Increase from securities without allowance in previous periods		Increase (decrease) from securities with allowance in previous periods		Securities sold			Decrease due to change in intent or requirement to sell		Write-offs			Recoveries		Ending balance
Fixed maturity securities:
U.S. corporate	$	9	$	—	$	—	$	(7	)	$	—	$	(2	)	$	—	$	—
Commercial mortgage-backed		6		—		—		(2	)		—		—			—		4
Total available-for-sale fixed maturity securities	$	15	$	—	$	—	$	(9	)	$	—	$	(2	)	$	—	$	4

The following table represents the allowance for credit losses aggregated by security type for available-for-sale fixed maturity securities as of and for the six months ended June 30, 2023:

(Amounts in millions)	Beginning balance		Increase from securities without allowance in previous periods		Increase (decrease) from securities with allowance in previous periods		Securities sold			Decrease due to change in intent or requirement to sell		Write-offs			Recoveries		Ending balance
Fixed maturity securities:
U.S. corporate	$	—	$	9	$	—	$	(7	)	$	—	$	(2	)	$	—	$	—
Commercial mortgage-backed		—		6		—		(2	)		—		—			—		4
Total available-for-sale fixed maturity securities	$	—	$	15	$	—	$	(9	)	$	—	$	(2	)	$	—	$	4

(c) Unrealized Investment Gains and Losses

Net unrealized gains and losses on available-for-sale investment securities reflected as a separate component of accumulated other comprehensive income (loss) were as follows as of the dates indicated:

(Amounts in millions)	June 30, 2024			December 31, 2023
Net unrealized gains (losses) on fixed maturity securities without an allowance for credit losses	$	(3,765	)	$	(2,577	)
Net unrealized gains (losses) on fixed maturity securities with an allowance for credit losses		—			—
Adjustments to policyholder contract balances		79			52
Income taxes, net		600			352
Net unrealized investment gains (losses)		(3,086	)		(2,173	)
Less: net unrealized investment gains (losses) attributable to noncontrolling interests		(44	)		(43	)
Net unrealized investment gains (losses) attributable to Genworth Financial, Inc.	$	(3,042	)	$	(2,130	)

The change in net unrealized gains (losses) on available-for-sale investment securities reported in accumulated other comprehensive income (loss) was as follows as of and for the periods indicated:

	Three months ended June 30,						Six months ended June 30,
(Amounts in millions)	2024			2023			2024			2023
Beginning balance	$	(2,615	)	$	(2,500	)	$	(2,130	)	$	(3,407	)
Unrealized gains (losses) arising during the period:
Unrealized gains (losses) on fixed maturity securities		(575	)		(755	)		(1,229	)		415
Adjustments to policyholder contract balances (1)		13			13			27			(6	)
Provision for income taxes		120			158			257			(87	)
Change in unrealized gains (losses) on investment securities		(442	)		(584	)		(945	)		322
Reclassification adjustments to net investment (gains) losses, net of taxes of $(4), $(7), $(9) and $(10)		15			23			32			36
Change in net unrealized investment gains (losses)		(427	)		(561	)		(913	)		358
Less: change in net unrealized investment gains (losses) attributable to noncontrolling interests		—			(5	)		(1	)		7
Ending balance	$	(3,042	)	$	(3,056	)	$	(3,042	)	$	(3,056	)

(1)  See note 10 for additional information.

Amounts reclassified out of accumulated other comprehensive income (loss) to net investment gains (losses) include realized gains (losses) on sales of securities, which are determined on a specific identification basis.

(d) Fixed Maturity Securities

As of June 30, 2024, the amortized cost or cost, gross unrealized gains (losses), allowance for credit losses and fair value of our fixed maturity securities classified as available-for-sale were as follows:

(Amounts in millions)	Amortized cost or cost		Gross unrealized gains		Gross unrealized losses			Allowance for credit losses		Fair value
Fixed maturity securities:
U.S. government, agencies and government-sponsored enterprises	$	3,777	$	38	$	(303	)	$	—	$	3,512
State and political subdivisions		2,453		10		(295	)		—		2,168
Non-U.S. government		804		8		(103	)		—		709
U.S. corporate:
Utilities		4,639		47		(454	)		—		4,232
Energy		2,448		43		(169	)		—		2,322
Finance and insurance		7,703		55		(730	)		—		7,028
Consumer—non-cyclical		4,671		62		(380	)		—		4,353
Technology and communications		3,011		47		(308	)		—		2,750
Industrial		1,186		14		(106	)		—		1,094
Capital goods		2,268		36		(159	)		—		2,145
Consumer—cyclical		1,660		14		(121	)		—		1,553
Transportation		1,121		32		(91	)		—		1,062
Other		288		2		(16	)		—		274
Total U.S. corporate		28,995		352		(2,534	)		—		26,813
Non-U.S. corporate:
Utilities		778		—		(68	)		—		710
Energy		1,078		23		(54	)		—		1,047
Finance and insurance		1,961		33		(142	)		—		1,852
Consumer—non-cyclical		672		3		(77	)		—		598
Technology and communications		881		6		(81	)		—		806
Industrial		846		9		(52	)		—		803
Capital goods		639		4		(48	)		—		595
Consumer—cyclical		249		1		(19	)		—		231
Transportation		441		11		(30	)		—		422
Other		609		8		(45	)		—		572
Total non-U.S. corporate		8,154		98		(616	)		—		7,636
Residential mortgage-backed		906		4		(59	)		—		851
Commercial mortgage-backed		1,605		1		(294	)		—		1,312
Other asset-backed		2,304		6		(78	)		—		2,232
Total available-for-sale fixed maturity securities	$	48,998	$	517	$	(4,282	)	$	—	$	45,233

As of December 31, 2023, the amortized cost or cost, gross unrealized gains (losses), allowance for credit losses and fair value of our fixed maturity securities classified as available-for-sale were as follows:

(Amounts in millions)	Amortized cost or cost		Gross unrealized gains		Gross unrealized losses			Allowance for credit losses			Fair value
Fixed maturity securities:
U.S. government, agencies and government-sponsored enterprises	$	3,588	$	121	$	(215	)	$	—		$	3,494
State and political subdivisions		2,537		24		(259	)		—			2,302
Non-U.S. government		703		15		(92	)		—			626
U.S. corporate:
Utilities		4,521		104		(352	)		—			4,273
Energy		2,449		66		(143	)		—			2,372
Finance and insurance		7,813		99		(634	)		—			7,278
Consumer—non-cyclical		4,648		129		(272	)		—			4,505
Technology and communications		3,187		75		(239	)		—			3,023
Industrial		1,294		27		(88	)		—			1,233
Capital goods		2,230		69		(118	)		—			2,181
Consumer—cyclical		1,715		30		(96	)		—			1,649
Transportation		1,187		44		(69	)		—			1,162
Other		316		6		(13	)		—			309
Total U.S. corporate		29,360		649		(2,024	)		—			27,985
Non-U.S. corporate:
Utilities		739		1		(55	)		—			685
Energy		1,038		34		(45	)		—			1,027
Finance and insurance		2,041		47		(140	)		—			1,948
Consumer—non-cyclical		669		8		(61	)		—			616
Technology and communications		944		12		(65	)		—			891
Industrial		829		17		(49	)		—			797
Capital goods		591		8		(38	)		—			561
Consumer—cyclical		236		2		(17	)		—			221
Transportation		369		15		(20	)		—			364
Other		726		18		(43	)		—			701
Total non-U.S. corporate		8,182		162		(533	)		—			7,811
Residential mortgage-backed		953		8		(54	)		—			907
Commercial mortgage-backed		1,714		1		(290	)		(7	)		1,418
Other asset-backed		2,328		6		(96	)		—			2,238
Total available-for-sale fixed maturity securities	$	49,365	$	986	$	(3,563	)	$	(7	)	$	46,781

The following table presents the gross unrealized losses and fair values of our fixed maturity securities for which an allowance for credit losses had not been recorded, aggregated by investment type and length of time that individual fixed maturity securities had been in a continuous unrealized loss position, as of June 30, 2024:

	Less than 12 months							12 months or more							Total
(Dollar amounts in millions)	Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities
Description of Securities
Fixed maturity securities:
U.S. government, agencies and government-sponsored enterprises	$	688	$	(13	)		60	$	1,299	$	(290	)		49	$	1,987	$	(303	)		109
State and political subdivisions		253		(6	)		38		1,571		(289	)		262		1,824		(295	)		300
Non-U.S. government		164		(3	)		32		420		(100	)		61		584		(103	)		93
U.S. corporate		3,397		(108	)		500		16,313		(2,426	)		2,095		19,710		(2,534	)		2,595
Non-U.S. corporate		814		(16	)		115		4,856		(600	)		636		5,670		(616	)		751
Residential mortgage-backed		96		(1	)		55		495		(58	)		168		591		(59	)		223
Commercial mortgage-backed		—		—			—		1,286		(294	)		216		1,286		(294	)		216
Other asset-backed		108		(1	)		37		1,226		(77	)		266		1,334		(78	)		303
Total for fixed maturity securities in an unrealized loss position	$	5,520	$	(148	)		837	$	27,466	$	(4,134	)		3,753	$	32,986	$	(4,282	)		4,590
% Below cost:
<20% Below cost	$	5,445	$	(125	)		829	$	23,296	$	(2,635	)		3,175	$	28,741	$	(2,760	)		4,004
20%-50% Below cost		75		(23	)		8		4,170		(1,499	)		578		4,245		(1,522	)		586
Total for fixed maturity securities in an unrealized loss position	$	5,520	$	(148	)		837	$	27,466	$	(4,134	)		3,753	$	32,986	$	(4,282	)		4,590
Investment grade	$	5,413	$	(146	)		814	$	26,434	$	(4,006	)		3,604	$	31,847	$	(4,152	)		4,418
Below investment grade		107		(2	)		23		1,032		(128	)		149		1,139		(130	)		172
Total for fixed maturity securities in an unrealized loss position	$	5,520	$	(148	)		837	$	27,466	$	(4,134	)		3,753	$	32,986	$	(4,282	)		4,590

The following table presents the gross unrealized losses and fair values of our corporate securities for which an allowance for credit losses had not been recorded, aggregated by investment type and length of time that individual investment securities had been in a continuous unrealized loss position, based on industry, as of June 30, 2024:

	Less than 12 months							12 months or more							Total
(Dollar amounts in millions)	Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities
Description of Securities
U.S. corporate:
Utilities	$	855	$	(18	)		114	$	2,096	$	(436	)		309	$	2,951	$	(454	)		423
Energy		256		(19	)		49		1,254		(150	)		162		1,510		(169	)		211
Finance and insurance		648		(13	)		88		4,996		(717	)		625		5,644		(730	)		713
Consumer—non-cyclical		573		(17	)		82		2,483		(363	)		273		3,056		(380	)		355
Technology and communications		323		(13	)		53		1,936		(295	)		256		2,259		(308	)		309
Industrial		150		(5	)		17		670		(101	)		92		820		(106	)		109
Capital goods		242		(14	)		41		1,106		(145	)		142		1,348		(159	)		183
Consumer—cyclical		179		(4	)		34		1,047		(117	)		142		1,226		(121	)		176
Transportation		127		(4	)		17		582		(87	)		75		709		(91	)		92
Other		44		(1	)		5		143		(15	)		19		187		(16	)		24
Subtotal, U.S. corporate securities		3,397		(108	)		500		16,313		(2,426	)		2,095		19,710		(2,534	)		2,595
Non-U.S. corporate:
Utilities		104		(2	)		11		575		(66	)		65		679		(68	)		76
Energy		122		(2	)		15		450		(52	)		53		572		(54	)		68
Finance and insurance		144		(2	)		29		1,328		(140	)		186		1,472		(142	)		215
Consumer—non-cyclical		97		(5	)		14		416		(72	)		50		513		(77	)		64
Technology and communications		63		(1	)		9		597		(80	)		74		660		(81	)		83
Industrial		94		(1	)		16		418		(51	)		60		512		(52	)		76
Capital goods		105		(2	)		12		356		(46	)		47		461		(48	)		59
Consumer—cyclical		—		—			—		170		(19	)		25		170		(19	)		25
Transportation		—		—			—		266		(30	)		35		266		(30	)		35
Other		85		(1	)		9		280		(44	)		41		365		(45	)		50
Subtotal, non-U.S. corporate securities		814		(16	)		115		4,856		(600	)		636		5,670		(616	)		751
Total for corporate securities in an unrealized loss position	$	4,211	$	(124	)		615	$	21,169	$	(3,026	)		2,731	$	25,380	$	(3,150	)		3,346

We did not recognize an allowance for credit losses on securities in an unrealized loss position included in the tables above. Based on a qualitative and quantitative review of the issuers of the securities, we believe the decline in fair value was largely due to increased interest rates and was not indicative of credit losses. The issuers continue to make timely principal and interest payments. For all securities in an unrealized loss position without an allowance for credit losses, we expect to recover the amortized cost based on our estimate of the amount and timing of cash flows to be collected. We do not intend to sell nor do we expect that we will be required to sell these securities prior to recovering our amortized cost.

The following table presents the gross unrealized losses and fair values of our fixed maturity securities for which an allowance for credit losses had not been recorded, aggregated by investment type and length of time that individual fixed maturity securities had been in a continuous unrealized loss position, as of December 31, 2023:

	Less than 12 months							12 months or more							Total
(Dollar amounts in millions)	Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities
Description of Securities
Fixed maturity securities:
U.S. government, agencies and government-sponsored enterprises	$	28	$	(1	)		6	$	1,353	$	(214	)		50	$	1,381	$	(215	)		56
State and political subdivisions		121		(2	)		18		1,581		(257	)		268		1,702		(259	)		286
Non-U.S. government		—		—			—		448		(92	)		67		448		(92	)		67
U.S. corporate		1,054		(30	)		142		17,019		(1,994	)		2,164		18,073		(2,024	)		2,306
Non-U.S. corporate		157		(5	)		19		5,180		(528	)		684		5,337		(533	)		703
Residential mortgage-backed		62		(1	)		31		477		(53	)		156		539		(54	)		187
Commercial mortgage-backed		37		(1	)		7		1,349		(289	)		224		1,386		(290	)		231
Other asset-backed		—		—			—		1,624		(96	)		327		1,624		(96	)		327
Total for fixed maturity securities in an unrealized loss position	$	1,459	$	(40	)		223	$	29,031	$	(3,523	)		3,940	$	30,490	$	(3,563	)		4,163
% Below cost:
<20% Below cost	$	1,450	$	(37	)		221	$	26,032	$	(2,509	)		3,542	$	27,482	$	(2,546	)		3,763
20%-50% Below cost		9		(3	)		2		2,999		(1,014	)		398		3,008		(1,017	)		400
Total for fixed maturity securities in an unrealized loss position	$	1,459	$	(40	)		223	$	29,031	$	(3,523	)		3,940	$	30,490	$	(3,563	)		4,163
Investment grade	$	1,441	$	(40	)		221	$	27,804	$	(3,394	)		3,762	$	29,245	$	(3,434	)		3,983
Below investment grade		18		—			2		1,227		(129	)		178		1,245		(129	)		180
Total for fixed maturity securities in an unrealized loss position	$	1,459	$	(40	)		223	$	29,031	$	(3,523	)		3,940	$	30,490	$	(3,563	)		4,163

The following table presents the gross unrealized losses and fair values of our corporate securities for which an allowance for credit losses had not been recorded, aggregated by investment type and length of time that individual investment securities had been in a continuous unrealized loss position, based on industry, as of December 31, 2023:

	Less than 12 months							12 months or more							Total
(Dollar amounts in millions)	Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities		Fair value		Gross unrealized losses			Number of securities
Description of Securities
U.S. corporate:
Utilities	$	177	$	(2	)		21	$	2,129	$	(350	)		308	$	2,306	$	(352	)		329
Energy		122		(2	)		20		1,343		(141	)		168		1,465		(143	)		188
Finance and insurance		274		(8	)		42		5,192		(626	)		645		5,466		(634	)		687
Consumer—non-cyclical		173		(6	)		18		2,529		(266	)		280		2,702		(272	)		298
Technology and communications		105		(6	)		19		2,100		(233	)		269		2,205		(239	)		288
Industrial		50		(1	)		6		702		(87	)		96		752		(88	)		102
Capital goods		—		—			—		1,193		(118	)		150		1,193		(118	)		150
Consumer—cyclical		88		(1	)		11		1,073		(95	)		148		1,161		(96	)		159
Transportation		65		(4	)		5		621		(65	)		82		686		(69	)		87
Other		—		—			—		137		(13	)		18		137		(13	)		18
Subtotal, U.S. corporate securities		1,054		(30	)		142		17,019		(1,994	)		2,164		18,073		(2,024	)		2,306
Non-U.S. corporate:
Utilities		—		—			—		609		(55	)		68		609		(55	)		68
Energy		39		(1	)		4		487		(44	)		59		526		(45	)		63
Finance and insurance		100		(2	)		10		1,358		(138	)		203		1,458		(140	)		213
Consumer—non-cyclical		—		—			—		471		(61	)		55		471		(61	)		55
Technology and communications		—		—			—		659		(65	)		83		659		(65	)		83
Industrial		18		(2	)		5		436		(47	)		61		454		(49	)		66
Capital goods		—		—			—		384		(38	)		49		384		(38	)		49
Consumer—cyclical		—		—			—		188		(17	)		26		188		(17	)		26
Transportation		—		—			—		216		(20	)		30		216		(20	)		30
Other		—		—			—		372		(43	)		50		372		(43	)		50
Subtotal, non-U.S. corporate securities		157		(5	)		19		5,180		(528	)		684		5,337		(533	)		703
Total for corporate securities in an unrealized loss position	$	1,211	$	(35	)		161	$	22,199	$	(2,522	)		2,848	$	23,410	$	(2,557	)		3,009

The scheduled maturity distribution of fixed maturity securities as of June 30, 2024 is set forth below. Actual maturities may differ from contractual maturities because issuers of securities may have the right to call or prepay obligations with or without call or prepayment penalties.

(Amounts in millions)	Amortized cost or cost		Fair value
Due one year or less	$	1,267	$	1,254
Due after one year through five years		8,281		8,022
Due after five years through ten years		12,210		11,427
Due after ten years		22,425		20,135
Subtotal		44,183		40,838
Residential mortgage-backed		906		851
Commercial mortgage-backed		1,605		1,312
Other asset-backed		2,304		2,232
Total	$	48,998	$	45,233

As of June 30, 2024, securities issued by finance and insurance, consumer—non-cyclical, utilities and technology and communications industry groups represented approximately 27%, 14%, 14% and 10%, respectively, of our domestic and foreign corporate fixed maturity securities portfolio. No other industry group comprised more than 10% of our investment portfolio.

As of June 30, 2024, we did not hold any fixed maturity securities in any single issuer, other than securities issued or guaranteed by the U.S. government, which exceeded 10% of stockholders’ equity.

(e) Commercial Mortgage Loans

Our mortgage loans are collateralized by commercial properties, including multi-family residential buildings. The carrying value of commercial mortgage loans is stated at original cost net of principal payments, amortization and allowance for credit losses.

We diversify our commercial mortgage loans by both property type and geographic region. The following tables set forth the distribution across property type and geographic region for commercial mortgage loans as of the dates indicated:

	June 30, 2024						December 31, 2023
(Amounts in millions)	Carrying value			% of total			Carrying value			% of total
Property type:
Retail	$	2,794			42	%	$	2,858			42	%
Office		1,457			22			1,481			22
Industrial		1,400			21			1,440			21
Apartments		513			8			522			8
Mixed use		372			5			371			5
Other		156			2			157			2
Subtotal		6,692			100	%		6,829			100	%
Allowance for credit losses		(30	)					(27	)
Total	$	6,662					$	6,802

	June 30, 2024						December 31, 2023
(Amounts in millions)	Carrying value			% of total			Carrying value			% of total
Geographic region:
South Atlantic	$	1,808			27	%	$	1,803			26	%
Pacific		1,228			18			1,281			19
Mountain		1,002			15			1,029			15
Middle Atlantic		889			13			925			14
West South Central		545			8			553			8
East North Central		442			7			445			6
West North Central		396			6			404			6
East South Central		202			3			206			3
New England		180			3			183			3
Subtotal		6,692			100	%		6,829			100	%
Allowance for credit losses		(30	)					(27	)
Total	$	6,662					$	6,802

As of June 30, 2024, we had one commercial mortgage loan with an amortized cost of $11 million that was 61-90 days past due in the industrial property type. The carrying value of this commercial mortgage loan was lower than the fair value of its collateral as of June 30, 2024. We had no other commercial mortgage loans past due or any commercial mortgage loans on non-accrual status as of June 30, 2024. As of December 31, 2023, we had no commercial mortgage loans past due or on non-accrual status. For a discussion of our policy related to placing commercial mortgage loans on non-accrual status, see Note 2—Summary of Significant Accounting Policies included in the Notes to Consolidated Financial Statements in our 2023 Annual Report on Form 10-K.

During the six months ended June 30, 2024 and the year ended December 31, 2023, we did not have any loan modifications or extensions associated with borrowers experiencing financial difficulty that resulted in the consideration of whether to establish a new loan or to continue accounting for the modification or extension under the existing loan.

The following table sets forth the allowance for credit losses related to commercial mortgage loans as of and for the periods indicated:

	Three months ended June 30,				Six months ended June 30,
(Amounts in millions)	2024		2023		2024		2023
Allowance for credit losses:
Beginning balance	$	29	$	24	$	27	$	22
Provision		1		—		3		2
Write-offs		—		—		—		—
Recoveries		—		—		—		—
Ending balance	$	30	$	24	$	30	$	24

In evaluating the credit quality of commercial mortgage loans, we assess the performance of the underlying loans using both quantitative and qualitative criteria. Certain risks associated with commercial mortgage loans can be evaluated by reviewing both the debt-to-value and debt service coverage ratio to understand both the

probability of the borrower not being able to make the necessary loan payments as well as the ability to sell the underlying property for an amount that would enable us to recover our unpaid principal balance in the event of default by the borrower. The average debt-to-value ratio is based on our most recent estimate of the fair value for the underlying property which is evaluated at least annually and updated more frequently if necessary to better indicate risk associated with the loan. A lower debt-to-value indicates that our loan value is more likely to be recovered in the event of default by the borrower if the property were sold. The debt service coverage ratio is based on “normalized” annual income of the property compared to the payments required under the terms of the loan. Normalization allows for the removal of annual one-time events such as capital expenditures, prepaid or late real estate tax payments or non-recurring third-party fees (such as legal, consulting or contract fees). This ratio is evaluated at least annually and updated more frequently if necessary to better indicate risk associated with the loan. A higher debt service coverage ratio indicates the borrower is less likely to default on the loan. The debt service coverage ratio is not used without considering other factors associated with the borrower, such as the borrower’s liquidity or access to other resources that may result in our expectation that the borrower will continue to make the future scheduled payments.

The following tables set forth commercial mortgage loans by year of origination and credit quality indicator as of June 30, 2024:

(Amounts in millions)	2024		2023		2022		2021		2020		2019 and prior		Total
Debt-to-value:
0% - 50%	$	29	$	20	$	74	$	85	$	114	$	1,958	$	2,280
51% - 60%		6		28		107		239		105		967		1,452
61% - 75%		94		221		738		570		247		1,040		2,910
76% - 100%		—		—		—		—		4		46		50
Greater than 100%		—		—		—		—		—		—		—
Total amortized cost	$	129	$	269	$	919	$	894	$	470	$	4,011	$	6,692
Debt service coverage ratio:
Less than 1.00	$	—	$	—	$	17	$	4	$	17	$	215	$	253
1.00 - 1.25		3		14		37		9		16		176		255
1.26 - 1.50		59		171		220		102		66		605		1,223
1.51 - 2.00		42		65		391		416		201		1,454		2,569
Greater than 2.00		25		19		254		363		170		1,561		2,392
Total amortized cost	$	129	$	269	$	919	$	894	$	470	$	4,011	$	6,692

The following tables set forth the debt-to-value of commercial mortgage loans by property type as of the dates indicated:

	June 30, 2024
(Amounts in millions)	0% - 50%			51% - 60%			61% - 75%			76% - 100%			Greater than 100%			Total
Property type:
Retail	$	922		$	729		$	1,143		$	—		$	—		$	2,794
Office		346			341			735			35			—			1,457
Industrial		610			251			539			—			—			1,400
Apartments		199			62			244			8			—			513
Mixed use		115			59			191			7			—			372
Other		88			10			58			—			—			156
Total amortized cost	$	2,280		$	1,452		$	2,910		$	50		$	—		$	6,692
% of total		34	%		22	%		43	%		1	%		—	%		100	%
Weighted-average debt service coverage ratio		2.40			1.85			1.67			0.87			—			1.95

	December 31, 2023
(Amounts in millions)	0% - 50%			51% - 60%			61% - 75%			76% - 100%			Greater than 100%			Total
Property type:
Retail	$	945		$	686		$	1,227		$	—		$	—		$	2,858
Office		350			325			771			35			—			1,481
Industrial		670			250			520			—			—			1,440
Apartments		194			61			259			8			—			522
Mixed use		120			61			183			7			—			371
Other		89			10			58			—			—			157
Total amortized cost	$	2,368		$	1,393		$	3,018		$	50		$	—		$	6,829
% of total		35	%		20	%		44	%		1	%		—	%		100	%
Weighted-average debt service coverage ratio		2.42			1.87			1.66			0.87			—			1.96

The following tables set forth the debt service coverage ratio for fixed rate commercial mortgage loans by property type as of the dates indicated:

	June 30, 2024
(Amounts in millions)	Less than 1.00			1.00 - 1.25			1.26 - 1.50			1.51 -  2.00			Greater than 2.00			Total
Property type:
Retail	$	49		$	106		$	578		$	1,120		$	941		$	2,794
Office		99			45			244			601			468			1,457
Industrial		42			30			209			472			647			1,400
Apartments		12			50			79			184			188			513
Mixed use		27			10			91			161			83			372
Other		24			14			22			31			65			156
Total amortized cost	$	253		$	255		$	1,223		$	2,569		$	2,392		$	6,692
% of total		4	%		4	%		18	%		38	%		36	%		100	%
Weighted-average debt-to-value		63	%		62	%		64	%		57	%		46	%		55	%

	December 31, 2023
(Amounts in millions)	Less than 1.00			1.00 - 1.25			1.26 - 1.50			1.51 -  2.00			Greater than 2.00			Total
Property type:
Retail	$	54		$	105		$	583		$	1,142		$	974		$	2,858
Office		105			48			244			615			469			1,481
Industrial		43			30			181			471			715			1,440
Apartments		12			51			86			187			186			522
Mixed use		27			14			80			164			86			371
Other		24			15			22			32			64			157
Total amortized cost	$	265		$	263		$	1,196		$	2,611		$	2,494		$	6,829
% of total		4	%		4	%		17	%		38	%		37	%		100	%
Weighted-average debt-to-value		64	%		63	%		65	%		58	%		46	%		55	%