| Liability for Future Policy Benefits and Unpaid Claims Disclosure |
Reserves for Future Policy Benefits and Contract Owner Account Balances The balances and changes in the liability for future policy benefits for Health Solutions Group, Health Solutions Voluntary and Businesses Exited are presented in the tables below for the periods indicated:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | Health Solutions Group | | Health Solutions Voluntary | | Businesses Exited | | March 31, 2023 | December 31, 2022 | | March 31, 2023 | December 31, 2022 | | March 31, 2023 | December 31, 2022 | | Present Value of Expected Net Premiums: | | | | | | | | | | Balance at January 1 | $ | 77 | | $ | 93 | | | $ | 97 | | $ | 105 | | | $ | 4,244 | | $ | 5,634 | | | Beginning balance at original discount rate | 84 | | 85 | | | 100 | | 92 | | | 4,128 | | 4,226 | | | Effect of change in cash flow assumptions | — | | (7) | | | — | | — | | | — | | (69) | | | Effect of actual variances from expected experience | 6 | | 23 | | | 5 | | 20 | | | (10) | | 86 | | | Adjusted balance at January 1 | 90 | | 101 | | | 105 | | 112 | | | 4,118 | | 4,243 | | | Interest accrual | 1 | | 2 | | | 1 | | 4 | | | 57 | | 230 | | Net premiums collected(1) | (6) | | (19) | | | (4) | | (16) | | | (82) | | (345) | | | Ending balance at original discount rate | 85 | | 84 | | | 102 | | 100 | | | 4,093 | | 4,128 | | | Effects of changes in discount rate assumptions | (5) | | (7) | | | (1) | | (3) | | | 244 | | 116 | | | Balance at end of period | $ | 80 | | $ | 77 | | | $ | 101 | | $ | 97 | | | $ | 4,337 | | $ | 4,244 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | Present Value of Expected Future Policy Benefits: | | | | | | | | | | Balance at January 1 | $ | 881 | | $ | 1,048 | | | $ | 285 | | $ | 359 | | | $ | 8,639 | | $ | 11,444 | | | Beginning balance at original discount rate | 913 | | 952 | | | 294 | | 290 | | | 8,644 | | 9,079 | | | Effect of change in cash flow assumptions | 1 | | (43) | | | — | | (2) | | | — | | (77) | | | Effect of actual variances from expected experience | 1 | | (27) | | | 5 | | 11 | | | (9) | | (52) | | | Adjusted balance at January 1 | 915 | | 882 | | | 299 | | 299 | | | 8,635 | | 8,950 | | | Issuances | 35 | | 139 | | | — | | — | | | 4 | | 13 | | | Interest accrual | 6 | | 25 | | | 4 | | 14 | | | 110 | | 458 | | | Benefit payments | (32) | | (133) | | | (7) | | (19) | | | (209) | | (777) | | | Ending balance at original discount rate | 924 | | 913 | | | 296 | | 294 | | | 8,540 | | 8,644 | | | Effects of changes in discount rate assumptions | (23) | | (32) | | | 1 | | (9) | | | 227 | | (5) | | | Balance at end of period | $ | 901 | | $ | 881 | | | $ | 297 | | $ | 285 | | | $ | 8,767 | | $ | 8,639 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | Net liability for future policy benefits | $ | 821 | | $ | 804 | | | $ | 196 | | $ | 188 | | | $ | 4,430 | | $ | 4,395 | | | Less: Reinsurance recoverable | 295 | | 283 | | | — | | — | | | 4,447 | | 4,411 | | | Net liability for future policy benefits, after reinsurance recoverable | $ | 526 | | $ | 521 | | | $ | 196 | | $ | 188 | | | $ | (17) | | $ | (16) | |
(1) Net Premiums collected represent the portion of gross premiums collected from policyholders that is used to fund expected benefit payments.
The reconciliation of the net liability for future policy benefits to the liability for future policy benefits in the Condensed Consolidated Balance Sheets is presented below: | | | | | | | | | | | | | March 31, 2023 | | December 31, 2022 | | Health Solutions Group | $ | 821 | | | $ | 804 | | | Health Solutions Voluntary | 196 | | | 188 | | | Businesses Exited - Future policy benefits | 4,430 | | | 4,395 | | | Businesses Exited – Additional liability | 2,096 | | | 2,107 | | | Other | 2,241 | | | 2,225 | | | Total | $ | 9,784 | | | $ | 9,719 | |
The amount of undiscounted expected gross premiums and future benefit payments is presented in the table below:
| | | | | | | | | | | | | | | | | | | March 31, 2023 | | December 31, 2022 | | Undiscounted | Discounted | | Undiscounted | Discounted | | Health Solutions Group | | | | | | | Expected future benefit payments | $ | 1,152 | | $ | 924 | | | $ | 1,141 | | $ | 913 | | | Expected future gross premiums | 287 | | 231 | | | 286 | | 231 | | | Health Solutions Voluntary | | | | | | | Expected future benefit payments | 591 | | 296 | | | 588 | | 294 | | | Expected future gross premiums | 312 | | 206 | | | 307 | | 205 | |
The following table presents a rollforward of the additional reserve liability for Businesses exited for the periods indicated:
| | | | | | | | | | | | | Businesses exited | | March 31, 2023 | | December 31, 2022 | | Balance at beginning of period | $ | 2,107 | | | $ | 1,715 | | | Effect of change in cash flow assumptions | — | | | 540 | | | Effect of actual variances from expected experience | (50) | | | 15 | | | Adjusted balance at January 1 | 2,057 | | | 2,270 | | | Interest accrual | 21 | | | 80 | | | Excess Benefits | (108) | | | (427) | | | Assessments | 126 | | | 184 | | | Balance at end of period | 2,096 | | | 2,107 | | | Less: Reinsurance recoverable | 2,044 | | | 2,054 | | | Net additional liability, after reinsurance recoverable | $ | 52 | | | $ | 53 | |
The following table presents the weighted average duration of the liability for future policy benefits and the weighted average interest rates for the periods indicated: | | | | | | | | | | | | | | | | | | | | | | | | | | | | Health Solutions Group | | Health Solutions Voluntary | Businesses Exited | | March 31, 2023 | December 31, 2022 | | March 31, 2023 | December 31, 2022 | | March 31, 2023 | December 31, 2022 | Weighted average duration (in years)(1) | 7 | 7 | | 14 | 14 | | 8 | 8 | | Interest accretion rate | 4.0 | % | 4.1 | % | | 5.3 | % | 5.3 | % | | 5.0 | % | 5.0 | % | | Current discount rate | 4.9 | % | 5.2 | % | | 5.0 | % | 5.4 | % | | 5.1 | % | 5.7 | % |
(1) Weighted average duration (in years) for Businesses Exited includes additional liability.
The weighted average interest rates for the additional liability related to businesses exited were 4.1% and 4.3% for the periods ended March 31, 2023 and December 31,2022, respectively.
The following table presents a rollforward of Contract owner account balances for the periods indicated:
| | | | | | | | | | | | | | | | | | | Wealth Solutions Deferred Group and Individual Annuity | | Businesses Exited |
| March 31, 2023 | December 31, 2022 | | March 31, 2023 | December 31, 2022 | | Balance at January 1 | $ | 33,622 | | $ | 33,044 | | | $ | 5,146 | | $ | 5,532 | | | Deposits | 615 | | 2,962 | | | 76 | | 310 | | | Fee income | (2) | | (8) | | | (94) | | (384) | | | Surrenders and withdrawals | (1,506) | | (4,280) | | | (120) | | (281) | | | Benefit payments | (43) | | (157) | | | (39) | | (144) | | | Net transfers from (to) separate accounts | 93 | | 1,174 | | | — | | — | | | Interest credited | 219 | | 874 | | | 36 | | 150 | | | Other | 2 | | 13 | | | — | | (37) | | | Ending Balance | $ | 33,000 | | $ | 33,622 | | | $ | 5,005 | | $ | 5,146 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | Weighted-average crediting rate | 2.7 | % | 2.6 | % | | 2.5 | % | 2.5 | % | Net amount at risk (1) | $ | 159 | | $ | 199 | | | $ | 847 | | $ | 900 | | | Cash surrender value | $ | 32,513 | | $ | 33,125 | | | $ | 1,730 | | $ | 1,824 | |
(1) For those guarantees of benefits that are payable in the event of death, the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date and is calculated at a contract level. When a contract has both a living benefit and a death benefit, the Company calculates NAR at a contract level and aggregates the higher of the two values together.
The following table shows a reconciliation of the Contract owner account balances to the Condensed Consolidated Balance Sheets for the periods indicated: | | | | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 | | Wealth Solutions Deferred group and individual annuity | $ | 33,000 | | | $ | 33,622 | | | Businesses exited | 5,005 | | | 5,146 | | | Other | 3,704 | | | 3,687 | | | Total | $ | 41,709 | | | $ | 42,455 | |
The following table summarizes detail on the differences between the interest rate being credited to contract holders as of March 31, 2023, and the respective guaranteed minimum interest rates ("GMIRs"):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Account Value(1) | | | Excess of crediting rate over GMIR | | | At GMIR | | Up to .50% Above GMIR | | 0.51% - 1.00%
Above GMIR | | 1.01% - 1.50% Above GMIR | | 1.51% - 2.00% Above GMIR | | More than 2.00% Above GMIR | | Total | | Guaranteed minimum interest rate | | Up to 1.00% | | $ | 234 | | $ | 7,296 | | $ | 2,899 | | $ | 1,146 | | $ | 1,487 | | $ | 38 | | $ | 13,100 | | 1.01% - 2.00% | | 619 | | 141 | | 42 | | 2 | | 3 | | 7 | | 814 | | 2.01% - 3.00% | | 12,269 | | 78 | | 50 | | 110 | | — | | 3 | | 12,510 | | 3.01% - 4.00% | | 9,459 | | 153 | | — | | — | | — | | — | | 9,612 | | 4.01% and Above | | 1,626 | | 86 | | — | | — | | — | | — | | 1,712 | Renewable beyond 12 months (MYGA)(2) | | 412 | | — | | — | | — | | 3 | | — | | 415 | | Total discretionary rate setting products | | $ | 24,619 | | $ | 7,754 | | $ | 2,991 | | $ | 1,258 | | $ | 1,493 | | $ | 48 | | $ | 38,163 | | | | | | | | | | | | | | | |
(1) Includes only the account values for investment spread products with GMIRs and discretionary crediting rates, net of policy loans. Excludes Stabilizer products, which are fee based. (2) Represents multi year guaranteed annuity ("MYGA") contracts with renewal dates after March 31, 2023 on which we are required to credit interest above the contractual GMIR for at least the next twelve months.
The following table summarizes detail on the differences between the interest rate being credited to contract holders as of December 31, 2022 and the respective GMIRs:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Account Value(1) | | | Excess of crediting rate over GMIR | | | At GMIR | | Up to .50% Above GMIR | | 0.51% - 1.00%
Above GMIR | | 1.01% - 1.50% Above GMIR | | 1.51% - 2.00% Above GMIR | | More than 2.00% Above GMIR | | Total | | Guaranteed minimum interest rate | | Up to 1.00% | | $ | 5,848 | | $ | 2,967 | | $ | 1,907 | | $ | 1,112 | | $ | 1,462 | | $ | 102 | | $ | 13,398 | | 1.01% - 2.00% | | 707 | | 52 | | 35 | | 2 | | 2 | | 7 | | 805 | | 2.01% - 3.00% | | 12,677 | | 56 | | 46 | | 110 | | — | | 3 | | 12,892 | | 3.01% - 4.00% | | 9,448 | | 153 | | — | | — | | — | | — | | 9,601 | | 4.01% and Above | | 1,643 | | 87 | | — | | — | | — | | — | | 1,730 | Renewable beyond 12 months (MYGA)(2) | | 402 | | — | | — | | — | | 3 | | — | | 405 | | Total discretionary rate setting products | | $ | 30,725 | | $ | 3,315 | | $ | 1,988 | | $ | 1,224 | | $ | 1,467 | | $ | 112 | | $ | 38,831 | | | | | | | | | | | | | | | |
(1) Includes only the account values for investment spread products with GMIRs and discretionary crediting rates, net of policy loans. Excludes Stabilizer products, which are fee based. (2) Represents MYGA contracts with renewal dates after December 31, 2022 on which we are required to credit interest above the contractual GMIR for at least the next twelve months.
|