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Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REINSURANCE | REINSURANCE Global Atlantic maintains a number of reinsurance treaties with third parties whereby Global Atlantic assumes annuity and life policies on a coinsurance, modified coinsurance or funds withheld basis. Global Atlantic also maintains other reinsurance treaties including the cession of certain annuity, life and health policies. The effects of all reinsurance agreements on the consolidated statements of financial condition were as follows:
(1)Reported within reinsurance recoverable within the consolidated statements of financial condition. A key credit quality indicator is a counterparty’s AM Best financial strength rating. A.M. Best ratings are an independent opinion of a reinsurer’s ability to meet ongoing obligations to policyholders. Global Atlantic mitigates counterparty credit risk by requiring collateral and credit enhancements in various forms including engaging in funds withheld at interest and modified coinsurance transactions. 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:
(1)Ratings are periodically updated (at least annually) as A.M. Best issues new ratings. (2)Credit enhancements primarily include funds withheld payable at interest. (3)Includes credit loss allowance of $24.8 million and $21.0 million as of March 31, 2024 and December 31, 2023, respectively, held against reinsurance recoverable and funds withheld receivable at interest. (4)Includes $38.5 billion and $30.8 billion as of March 31, 2024 and December 31, 2023, respectively, associated with cessions to co-investment vehicles (the "sponsored reinsurance sidecar vehicles") that participate in qualifying reinsurance transactions sourced by Global Atlantic. As of both March 31, 2024 and December 31, 2023, Global Atlantic had $2.7 billion of funds withheld receivable at interest with six counterparties related to modified coinsurance and funds withheld contracts. The assets supporting the funds withheld receivable at interest balance are held in trusts for the benefit of Global Atlantic. The effects of reinsurance on the consolidated statements of operations were as follows:
Global Atlantic holds collateral for and provides collateral to its reinsurance clients. Global Atlantic held $45.1 billion and $36.7 billion of collateral in the form of funds withheld payable at interest on behalf of its reinsurers as of March 31, 2024 and December 31, 2023, respectively. As of both March 31, 2024 and December 31, 2023, reinsurers held collateral of $1.2 billion on behalf of Global Atlantic. A significant portion of the collateral that Global Atlantic provides to its reinsurance clients is provided in the form of assets held in a trust for the benefit of the counterparty. As of March 31, 2024 and December 31, 2023, these trusts held in excess of the $92.9 billion and $81.8 billion of assets they are required to hold in order to support reserves of $90.0 billion and $79.4 billion, respectively. Of the cash held in trust, Global Atlantic classified $75.1 million and $90.8 million as restricted as of March 31, 2024 and December 31, 2023, respectively.
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