Insurance Liabilities (Tables)

6 Months Ended

Jun. 30, 2024

Schedule of Liability for Future Policy Benefits, by Product Segment

Information regarding liability for future policy benefits (“LFPB”) for non-participating traditional and limited-payment contracts was as follows:


	Six Months Ended June 30,
	2024									2023
	Term and Whole Life Insurance			Income Annuities			Structured Settlement and Pension Risk Transfer Annuities			Term and Whole Life Insurance			Income Annuities			Structured Settlement and Pension Risk Transfer Annuities
	(Dollars in millions)
Present value of expected net premiums:
Balance, beginning of period	$	2,974		$	—		$	—		$	2,871		$	—		$	—
Beginning balance at original discount rate	3,234			—			—			3,212			—			—
Effect of model refinements	4			—			—			—			—			—

Effect of actual variances from expected experience	19			—			—			(8)			—			—
Adjusted beginning of period balance	3,257			—			—			3,204			—			—
Issuances	41			—			—			49			—			—
Interest accrual	57			—			—			55			—			—
Net premiums collected	(189)			—			—			(184)			—			—
Ending balance at original discount rate	3,166			—			—			3,124			—			—
Effect of changes in discount rate assumptions	(341)			—			—			(315)			—			—
Balance, end of period	$	2,825		$	—		$	—		$	2,809		$	—		$	—
Present value of expected future policy benefits:
Balance, beginning of period	$	5,507		$	3,754		$	6,697		$	5,279		$	3,512		$	6,793
Beginning balance at original discount rate	6,023			4,031			7,085			5,922			3,897			7,410
Effect of model refinements	9			—			—			—			—			—

Effect of actual variances from expected experience	28			(1)			(3)			(10)			(4)			(37)
Adjusted beginning of period balance	6,060			4,030			7,082			5,912			3,893			7,373
Issuances	43			197			—			50			182			—
Interest accrual	110			76			152			107			72			158
Benefit payments	(311)			(201)			(288)			(251)			(192)			(301)
Ending balance at original discount rate	5,902			4,102			6,946			5,818			3,955			7,230
Effect of changes in discount rate assumptions	(688)			(404)			(721)			(597)			(355)			(519)
Balance, end of period	$	5,214		$	3,698		$	6,225		$	5,221		$	3,600		$	6,711
Net liability for future policy benefits, end of period	$	2,389		$	3,698		$	6,225		$	2,412		$	3,600		$	6,711
Less: Reinsurance recoverable, end of period	37			30			61			41			25			66
Net liability for future policy benefits, after reinsurance recoverable	$	2,352		$	3,668		$	6,164		$	2,371		$	3,575		$	6,645
Weighted-average duration of liability	8.7 years			8.1 years			11.5 years			8.3 years			8.4 years			11.6 years
Weighted-average interest accretion rate	3.95		%	4.00		%	4.46		%	3.95		%	3.92		%	4.46		%
Current discount rate	5.46		%	5.46		%	5.56		%	5.18		%	5.19		%	5.20		%
Gross premiums or assessments recognized during period	$	284		$	247		$	—		$	307		$	224		$	—
Expected future gross premiums, undiscounted	$	5,953		$	—		$	—		$	6,531		$	—		$	—
Expected future gross premiums, discounted	$	4,477		$	—		$	—		$	4,837		$	—		$	—
Expected future benefit payments, undiscounted	$	8,163		$	5,809		$	13,483		$	8,044		$	5,608		$	14,062
Expected future benefit payments, discounted	$	5,902		$	4,102		$	6,946		$	5,818		$	3,955		$	7,230

Information regarding the additional insurance liabilities for universal life-type contracts with secondary guarantees was as follows:


	Six Months Ended June 30,
	2024			2023
	(Dollars in millions)
Balance, beginning of period	$	7,607		$	6,935
Beginning balance before the effect of unrealized gains and losses	7,784			7,175

Effect of actual variances from expected experience	67			60
Adjusted beginning of period balance	7,851			7,235
Interest accrual	190			175
Net assessments collected	215			206
Benefit payments	(201)			(195)

Ending balance before the effect of unrealized gains and losses	8,055			7,421
Effect of unrealized gains and losses	(250)			(211)
Balance, end of period	7,805			7,210
Less: Reinsurance recoverable, end of period	1,466			1,414
Net additional liability, after reinsurance recoverable	$	6,339		$	5,796
Weighted-average duration of liability	6.6 years			6.7 years
Weighted-average interest accretion rate	4.93		%	4.91		%
Gross assessments recognized during period	$	542		$	531

A reconciliation of the net LFPBs for non-participating traditional and limited-payment contracts and the additional insurance liabilities for universal life-type contracts with secondary guarantees reported in the preceding rollforward tables to LFPBs on the consolidated balance sheets was as follows at:


	June 30,
	2024		2023
	(In millions)
Liabilities reported in the preceding rollforward tables	$	20,117	$	19,933
Long-term care insurance (1)	5,224		5,606
ULSG liabilities, including liability for profits followed by losses	2,525		2,565
Participating whole life insurance (2)	3,161		3,031
Deferred profit liabilities	476		373
Other	383		391
Total liability for future policy benefits	$	31,886	$	31,899

_______________

(1)Includes liabilities related to fully reinsured individual long-term care insurance. See Note 2.

(2)Participating whole life insurance uses an interest assumption based on the non-forfeiture interest rate, ranging from 3.5% to 4.5%, and mortality rates guaranteed in calculating the cash surrender values described in such contracts, and also includes a liability for terminal dividends. Participating whole life insurance represented 3% of the Company’s life insurance in-force at both June 30, 2024 and 2023, and 41% of gross traditional life insurance premiums for both the six months ended June 30, 2024 and 2023.

Policyholder Account Balance

Information regarding policyholder account balances was as follows:


	Universal Life Insurance			Variable Annuities (1)			Index-linked Annuities			Fixed Rate Annuities			ULSG			Company-Owned Life Insurance (1)
	(Dollars in millions)
Six Months Ended June 30, 2024
Balance, beginning of period	$	2,550		$	4,307		$	41,627		$	14,672		$	5,052		$	653
Premiums and deposits	121			34			4,236			687			328			—
Surrenders and withdrawals	(49)			(351)			(2,510)			(736)			(10)			—
Benefit payments	(27)			(47)			(151)			(178)			(39)			(5)
Net transfers from (to) separate account	31			59			—			—			—			(1)
Interest credited	48			54			291			281			82			18
Policy charges	(108)			(12)			(9)			—			(499)			(6)
Changes related to embedded derivatives	—			—			2,605			—			—			—

Balance, end of period	$	2,566		$	4,044		$	46,089		$	14,726		$	4,914		$	659
Weighted-average crediting rate (2)	1.88		%	1.29		%	0.85		%	1.90		%	1.65		%	2.49		%
Six Months Ended June 30, 2023
Balance, beginning of period	$	2,658		$	4,908		$	33,897		$	14,274		$	5,307		$	641
Premiums and deposits	113			43			3,390			1,479			339			—
Surrenders and withdrawals	(90)			(326)			(1,613)			(874)			(12)			—
Benefit payments	(42)			(61)			(117)			(203)			(55)			(4)
Net transfers from (to) separate account	22			11			—			—			—			—
Interest credited	8			78			203			229			122			15
Policy charges	(110)			(14)			(4)			—			(513)			(6)
Changes related to embedded derivatives	—			—			2,793			—			—			—

Balance, end of period	$	2,559		$	4,639		$	38,549		$	14,905		$	5,188		$	646
Weighted-average crediting rate (2)	0.31		%	1.63		%	0.66		%	1.57		%	2.33		%	2.33		%

_______________

(1)Includes liabilities related to separate account products where the contract holder elected a general account investment option.

(2)Excludes the effects of embedded derivatives related to index-linked crediting rates.

A reconciliation of policyholder account balances reported in the preceding rollforward table to the liability for policyholder account balances on the consolidated balance sheets was as follows at:


	June 30,
	2024		2023
	(In millions)
Policyholder account balances reported in the preceding rollforward table	$	72,998	$	66,486
Funding agreements classified as investment contracts	11,502		11,041
Institutional group annuities	343		—
Other investment contract liabilities	1,022		1,116
Total policyholder account balances	$	85,865	$	78,643

Policyholder Account Balance, Guaranteed Minimum Crediting Rate

The balance of account values by range of guaranteed minimum crediting rates and the related range of difference, in basis points, between rates being credited to policyholders and the respective guaranteed minimums was as follows at:


Range of Guaranteed Minimum Crediting Rate	At Guaranteed Minimum		1 to 50 Basis Points Above		51 to 150 Basis Points Above		Greater than 150 Basis Points Above		Total
	(In millions)
June 30, 2024
Annuities (1):
Less than 2.00%	$	616	$	145	$	282	$	8,323	$	9,366
2.00% to 3.99%	8,034		327		167		502		9,030
Greater than 3.99%	828		—		—		—		828
Total	$	9,478	$	472	$	449	$	8,825	$	19,224
Life insurance (2) (3):
Less than 2.00%	$	—	$	—	$	—	$	275	$	275
2.00% to 3.99%	—		500		49		134		683
Greater than 3.99%	1,566		—		—		—		1,566
Total	$	1,566	$	500	$	49	$	409	$	2,524
ULSG (3):
Less than 2.00%	$	—	$	—	$	—	$	—	$	—
2.00% to 3.99%	1,093		1,439		1,633		247		4,412
Greater than 3.99%	493		—		—		—		493
Total	$	1,586	$	1,439	$	1,633	$	247	$	4,905
December 31, 2023
Annuities (1):
Less than 2.00%	$	697	$	223	$	310	$	7,652	$	8,882
2.00% to 3.99%	8,827		242		225		356		9,650
Greater than 3.99%	874		—		—		—		874
Total	$	10,398	$	465	$	535	$	8,008	$	19,406
Life insurance (2) (3):
Less than 2.00%	$	—	$	—	$	—	$	236	$	236
2.00% to 3.99%	—		492		49		136		677
Greater than 3.99%	1,595		—		—		—		1,595
Total	$	1,595	$	492	$	49	$	372	$	2,508
ULSG (3):
Less than 2.00%	$	—	$	—	$	—	$	—	$	—
2.00% to 3.99%	1,135		1,485		1,663		254		4,537
Greater than 3.99%	506		—		—		—		506
Total	$	1,641	$	1,485	$	1,663	$	254	$	5,043

_______________

(1)Includes policyholder account balances for fixed rate annuities and the fixed account portion of variable annuities.

(2)Includes policyholder account balances for retained asset accounts, universal life policies and the fixed account portion of universal variable life insurance policies.

(3)Amounts are gross of policy loans.