Reinsurance (Tables)
|
12 Months Ended |
Dec. 31, 2023 |
|---|
| Insurance [Abstract] |
|
| Summary of Assets Supporting Funds Withheld Arrangements |
There is a diverse pool of assets supporting the funds withheld arrangements with Fortitude Re. The following summarizes the composition of the pool of assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2023 | | December 31, 2022 | | | | (in millions) | | Carrying Value | | Fair Value | | Carrying Value | | Fair Value | | Corresponding Accounting Policy | Fixed maturity securities - available-for-sale | | $ | 15,204 | | $ | 15,204 | | $ | 16,339 | | $ | 16,339 | | Fair value through other comprehensive income | | Fixed maturity securities - fair value option | | 4,212 | | 4,212 | | 3,485 | | 3,485 | | Fair value through net investment income | | Commercial mortgage loans | | 3,378 | | 3,157 | | 3,490 | | 3,241 | | Amortized cost | | Real estate investments | | 184 | | 329 | | 133 | | 348 | | Amortized cost | | Private equity funds/hedge funds | | 1,910 | | 1,910 | | 1,893 | | 1,893 | | Fair value through net investment income | | Policy loans | | 330 | | 330 | | 355 | | 355 | | Amortized cost | | Short-term Investments | | 129 | | 129 | | 69 | | 69 | | Fair value through net investment income | | Funds withheld investment assets | | 25,347 | | 25,271 | | 25,764 | | 25,730 | | | Derivative assets, net(a) | | 45 | | 45 | | 90 | | 90 | | Fair value through realized gains (losses) | Other(b) | | 641 | | 641 | | 731 | | 731 | | Amortized cost | | Total | | $ | 26,033 | | $ | 25,957 | | $ | 26,585 | | $ | 26,551 | | |
(a) The derivative assets and liabilities have been presented net of cash collateral. The derivative assets and liabilities supporting the Fortitude Re funds withheld arrangements had a fair market value of $62 million and $6 million, respectively, as of December 31, 2023. The derivative assets supporting the Fortitude Re funds withheld arrangements had a fair market value of $189 million as of December 31, 2022. These derivative assets and liabilities are fully collateralized either by cash or securities. (b) Primarily comprised of Cash and Accrued investment income.
|
| Summary of The Impact of Funds Withheld Arrangements |
The impact of the funds withheld arrangements with Fortitude Re was as follows: | | | | | | | | | | | | | | | | | | | | | Years Ended December 31, | | | | (in millions) | 2023 | | 2022 | | 2021 | | | | Net investment income - Fortitude Re funds withheld assets | $ | 1,368 | | $ | 891 | | $ | 1,775 | | | | Net realized gains (losses) on Fortitude Re funds withheld assets: | | | | | | | | | Net realized gains (losses) Fortitude Re funds withheld assets | (224) | | (397) | | 924 | | | | Net realized losses Fortitude Re funds withheld embedded derivatives | (1,734) | | 6,347 | | (687) | | | | Net realized gains (losses) on Fortitude Re funds withheld assets | (1,958) | | 5,950 | | 237 | | | | Income before income tax benefit (expense) | (590) | | 6,841 | | 2,012 | | | | Income tax expense (benefit)* | (124) | | 1,437 | | 423 | | | | Net income (loss) | (466) | | 5,404 | | 1,589 | | | | Change in unrealized appreciation (depreciation) of the invested assets supporting the Fortitude Re modco arrangement classified as available-for-sale* | 491 | | (5,064) | | (1,488) | | | | Comprehensive income | $ | 25 | | $ | 340 | | $ | 101 | | |
* The income tax expense (benefit) and the tax impact in accumulated other comprehensive income was computed using Corebridge’s U.S. statutory tax rate of 21%.
|
| Reinsurance Recoverable, Allowance for Credit Loss |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | Individual | | | | Life | | Institutional | | | | | | (in millions) | Retirement | | | | Insurance | | Markets | | | | Total | Pre-adoption, December 31, 2020 for Reinsurance assets - other, net of allowance for credit losses and disputes(a) | $ | 309 | | | | $ | 2,370 | | $ | 43 | | | | $ | 2,722 | Reclassification of Cost of Reinsurance(b) | — | | | | 416 | | — | | | | 416 | | Reclassification to Market risk benefits | (35) | | | | — | | — | | | | (35) | | Change in cash flow assumptions and effect of net premiums exceeding gross premiums | — | | | | (52) | | — | | | | (52) | | Change due to the current upper-medium grade discount rate | — | | | | 99 | | 5 | | | | 104 | | Post-adoption January 1, 2021 for Reinsurance assets - other, net of allowance for credit losses and disputes | $ | 274 | | | | $ | 2,833 | | $ | 48 | | | | $ | 3,155 |
(a) Excludes $(15) million of Reinsurance assets - other, net of allowance for credit losses and disputes in Other Operations. (b) Cost of reinsurance is reported in Other liabilities in the Consolidated Balance Sheets. | | | | | | | | | | | | | | | | | | | | | | | | | Corporate and | | (in millions) | | | | | | | | | Other | | Pre-adoption, December 31, 2020 for Reinsurance assets - Fortitude Re, net of allowance for credit losses and disputes | | | | | | | | | $ | 29,158 | | | Change in cash flow assumptions and effect of net premiums exceeding gross premiums | | | | | | | | | 55 | | | Change due to the current upper-medium grade discount rate | | | | | | | | | 7,611 | | Post-adoption January 1, 2021 for Reinsurance assets - Fortitude Re, net of allowance for credit losses and disputes | | | | | | | | | $ | 36,824 |
The remeasurement of the reinsurance recoverable using the current upper-medium grade discount rate is offset in AOCI. The following table presents a rollforward of the reinsurance recoverable allowance: | | | | | | | | | | | | | | | | | | | | | | | Years Ended December 31, | | (in millions) | | 2023 | | 2022 | | 2021 | | Balance, beginning of year | | $ | 84 | | $ | 101 | | $ | 83 | Addition to (release of) allowance for expected credit losses and disputes, net | | (5) | | 8 | | 18 | | Write-offs charged against the allowance for credit losses and disputes | | (49) | | — | | — | | Other changes | | — | | (25) | | — | | Balance, end of year | | $ | 30 | | $ | 84 | | $ | 101 |
There were no material recoveries of credit losses previously written off for the year ended December 31, 2023 or 2022.
|
| Effects of Reinsurance |
The following table presents the impacts of reinsurance ceded and the corresponding gross liabilities on the Consolidated Balance Sheets: | | | | | | | | | | | | | December 31, | | | | | (in millions) | 2023 | | 2022 | | Assets | | | | | Reinsurance assets, net of allowance | $ | 1,620 | | $ | 2,517 | | Reinsurance assets - Fortitude Re, net of allowance | 26,772 | | 26,844 | | Total Assets | $ | 28,392 | | $ | 29,361 | | Liabilities | | | | | Future policy benefits for life and accident and health insurance contracts | $ | 57,108 | | $ | 50,518 | | Policyholder contract deposits | 162,050 | | 156,058 | | Other policyholder funds | 2,862 | | 2,885 | | Total Liabilities | $ | 222,020 | | $ | 209,461 |
The following table presents premiums earned and policy fees for our long-duration life insurance and annuity operations: | | | | | | | | | | | | | | | | | | | Years Ended December 31, | | | | | | | (in millions) | 2023 | | 2022 | | 2021 | | Premiums | | | | | | | Direct | $ | 4,706 | | $ | 4,739 | | $ | 4,603 | Assumed* | 4,111 | | 1,318 | | 2,265 | | Ceded | (1,126) | | (966) | | (1,215) | | Net | $ | 7,691 | | $ | 5,091 | | $ | 5,653 | | Policy Fees | | | | | | | Direct | $ | 2,873 | | $ | 2,992 | | $ | 3,090 | | Assumed | — | | — | | — | | Ceded | (76) | | (78) | | (85) | | Net | $ | 2,797 | | $ | 2,914 | | $ | 3,005 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
* Assumed premiums includes premium from pension risk transfer agreements of $4.1 billion, $1.3 billion, and $2.3 billion for the years ended December 31, 2023, 2022 and 2021, respectively.
|