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REINSURANCE (Tables)
3 Months Ended
Mar. 31, 2022
Insurance [Abstract]  
Effects of Reinsurance Agreements
The effects of all reinsurance agreements on the consolidated statement of financial condition were as follows:

March 31, 2022December 31, 2021
Policy liabilities:
Direct$68,444,765 $67,131,818 
Assumed62,631,922 59,388,226 
Total policy liabilities131,076,687 126,520,044 
Ceded(1)
(24,625,159)(25,035,228)
Net policy liabilities$106,451,528 $101,484,816 

(1)Reported within reinsurance recoverable within the consolidated statement of financial condition.
The effects of reinsurance on the consolidated statements of operations were as follows:

Three Months Ended March 31,
20222021
Premiums:
Direct$36,573 $14,175 
Assumed(1)
401,515 1,280,753 
Ceded(65,944)(118,786)
Net premiums$372,144 $1,176,142 
(1)Includes related party activity of $2.7 million for the three months ended March 31, 2021.
Three Months Ended March 31,
20222021
Policy fees:
Direct$240,991 $148,999 
Assumed(1)
77,778 52,955 
Ceded(333)(271)
Net policy fees$318,436 $201,683 

(1)Includes related party activity of $2.1 million for the three months ended March 31, 2021.

Three Months Ended March 31,
20222021
Policy benefits and claims:
Direct$235,604 $182,801 
Assumed(1)
604,233 1,467,127 
Ceded(113,777)(164,610)
Net policy benefits and claims$726,060 $1,485,318 

(1)Includes related party activity of $22.5 million for the three months ended March 31, 2021.
Reinsurance Recoverable and Funds Withheld Receivable at Interest by Credit Quality Indicator The following shows the amortized cost basis of Global Atlantic’s reinsurance recoverable and funds withheld receivable at interest by credit quality indicator and any associated credit enhancements Global Atlantic has obtained to mitigate counterparty credit risk:
As of March 31, 2022 As of December 31, 2021
A.M. Best Rating(1)
Reinsurance recoverable and funds withheld receivable at interest(2)
Credit enhancements(3)
Net reinsurance credit exposure(4)
Reinsurance recoverable and funds withheld receivable at interest(2)
Credit enhancements(3)
Net reinsurance credit exposure(4)
A++$8,810 $— $8,810 $7,911 $— $7,911 
A+1,977,750 — 1,977,750 1,989,426 — 1,989,426 
A2,571,414 — 2,571,414 2,652,286 — 2,652,286 
A-5,587,142 4,822,173 764,969 5,645,633 5,166,559 479,074 
B++37,176 — 37,176 33,410 — 33,410 
B+1,564 — 1,564 1,122 — 1,122 
B9,290 — 9,290 9,227 — 9,227 
B-1,850 — 1,850 1,274 — 1,274 
Not rated(5)
17,430,904 16,959,558 471,346 17,698,613 18,323,795 — 
Total$27,625,900 $21,781,731 $5,844,169 $28,038,902 $23,490,354 $5,173,730 

(1)Ratings are periodically updated (at least annually) as A.M. Best issues new ratings.
(2)At amortized cost, excluding any associated embedded derivative assets and liabilities.
(3)Includes funds withheld payable at interest and deferred intangible reinsurance assets and liabilities.
(4)Includes credit loss allowance of $28.1 million and $8.4 million as of March 31, 2022 and December 31, 2021, respectively, held against reinsurance recoverable.
(5)Includes $17.4 billion and $17.7 billion as of March 31, 2022 and December 31, 2021, respectively, associated with cessions to Ivy Re Limited, a Bermuda insurance company and a subsidiary of an investment vehicle that participates in qualifying reinsurance transactions sourced by Global Atlantic.