Large accelerated filer | ¨ | Accelerated filer | ¨ | |||||||||||||||||
Non-accelerated filer | x | Smaller reporting company | ¨ | |||||||||||||||||
Emerging growth company | o |
Title of each class of securities to be registered | Amount to registered (1) | Proposed maximum offering price unit (1) | Proposed maximum aggregate offering price (2) | Amount of registration fee (2) | |||||||||||||
Market Value Adjusted Annuity Contracts | N/A | $1 | N/A | N/A | |||||||||||||
(1) | The amount to be registered and the proposed maximum offering price per unit are not applicable because the securities are not issued in predetermined amounts or units. | ||||||||||||||||
(2) | By filing dated April 15, 2020, Allstate Life carried over $3,941,968 of unsold securities from Form S-3 Registration Statements of the same issuer (333-220832 and 333-220837) filed on October 5, 2017. Because filing fees of $252 and $255 previously were paid with respect to those securities, there is no filing fee under this Registration Statement. Registrant continues that offering in this Post-Effective Amendment to that Registration Statement. |
IMPORTANT NOTICES | Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities described in this prospectus or passed on the accuracy or the adequacy of this prospectus. Anyone who tell you otherwise is committing a federal crime. The contracts of which the MVA Account Option is a part may have been distributed through broker-dealers that have relationships with banks or other financial institutions or by employees of such banks. However, the contracts and the MVA Account Option are not deposits or obligations of, or guaranteed by such institutions or any federal regulatory agency. Investment in the MVA Account Option involves investment risks, including possible loss of principal. This prospectus does not constitute an offering in any jurisdiction in which such offering may not lawfully be made. We do not authorize anyone to provide any information or representations regarding the offering described in this prospectus other than as contained in this prospectus. The Contracts and the MVA Account Option are not FDIC insured. The MVA Account Option may not be available in all states. |
Page | |||||
Who is Allstate Life Insurance Company? | |||||
Important Terms | |||||
Expenses | |||||
Description of the MVA Account Option | |||||
Distribution of the Contracts | |||||
Additional Information | |||||
Experts | |||||
Legal Matters | |||||
Annual Reports and Other Documents | |||||
Disclosure of Commission Position on Indemnification for Securities Act Liabilities | |||||
Reliance on Rule 12h-7 | |||||
Appendix I: Market Value Adjustment Examples | |||||
Appendix II: Information with Respect to the Registrant | 14 |
I | = | the average daily Treasury Rate for a maturity equal to the applicable Guarantee Period for the week preceding the establishment of the Guarantee Period; | ||||||
N | = | the number of whole and partial years from the date we receive the withdrawal, transfer, or death benefit request, or from the Payout Start Date, to the end of the Guarantee Period; and | ||||||
J | = | the average daily Treasury Rate for a maturity equal to the Guarantee Period for the week preceding the receipt of the withdrawal, transfer, death benefit, or income payment request. If a Note with a maturity of the original Guarantee Period is not available, we determine an appropriate interest rate based on an interpolation of the next shortest duration and next longest duration Notes. |
Step 1. Calculate Contract Value at End of Contract Year 3: | $10,000.00 X (1.045)/3 = $11,411.66 | ||||||||||||||||
Step 2. Calculate the Free Withdrawal Amount: | .15 X ($10,000.00) = $1,500.00 | ||||||||||||||||
Step 3. Calculate the Market Value Adjustment: | I = | 4.5% | |||||||||||||||
J = | 4.2% | ||||||||||||||||
N = | 730 days | = 2 | |||||||||||||||
365 days | |||||||||||||||||
Market Value Adjustment Factor: .9 X [I - (J + .0025)] X N = .9 X [.045 - (.042 + .0025)] X 2 = .0009 | |||||||||||||||||
Market Value Adjustment = Market Value Adjustment Factor X Amount Subject to Market Value Adjustment: | |||||||||||||||||
= .0009 X ($11,411.66 - $1,500.00) = $8.92 | |||||||||||||||||
Step 4. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | |||||||||||||||||
$11,411.66 + $8.92 = $11,420.58 |
Step 1. Calculate Contract Value at End of Contract Year 3: | $10,000.00 X (1.045)/3 = $11,411.66 | ||||||||||||||||
Step 2. Calculate the Free Withdrawal Amount: | .15 X ($10,000.00) = $1,500.00 | ||||||||||||||||
Step 3. Calculate the Market Value Adjustment: | I = | 4.5% | |||||||||||||||
J = | 4.8% | ||||||||||||||||
N = | 730 days | =2 | |||||||||||||||
365 days | |||||||||||||||||
Market Value Adjustment Factor: .9 X [I - (J + .0025)] X N = .9 X [.045 - (.048 + .0025)] X 2 = -.0099 | |||||||||||||||||
Market Value Adjustment = Market Value Adjustment Factor X Amount Subject to Market Value Adjustment: | |||||||||||||||||
Step 4. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | = -.0099 X ($11,411.66 - $1,500.00) = -$98.13 | ||||||||||||||||
$11,411.66 - $98.13 = $11,313.53 |
Step 1. Calculate Contract Value at End of Contract Year 3: | $10,000.00 X (1.045)/3 = $11,411.66 | ||||||||||||||||
Step 2. Calculate the Free Withdrawal Amount: | .15 X ($10,000.00) = $1,500.00 | ||||||||||||||||
Step 3. Calculate the Withdrawal Charge: | = .06 X ($10,000 - $1,500) = $510.00 | ||||||||||||||||
Step 4. Calculate the Market Value Adjustment: | I = | 4.50% | |||||||||||||||
J = | 4.20% | ||||||||||||||||
N = | 730 days | =2 | |||||||||||||||
365 days | |||||||||||||||||
Market Value Adjustment Factor: .9 X [I - (J +.0025)] X N = .9 X [.045 - (.042 + .0025)] X 2 = .0009 | |||||||||||||||||
Market Value Adjustment = Market Value Adjustment Factor X Amount Subject to Market Value Adjustment: | |||||||||||||||||
Step 5. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | = .0009 X ($11,411.66 - $1,500.00) = $8.92 | ||||||||||||||||
$11,411.66 - $510.00 + $8.92 = $10,910.58 |
Step 1. Calculate Contract Value at End of Contract Year 3: | $10,000.00 X (1.045)/3 = $11,411.66 | ||||||||||||||||
Step 2. Calculate the Free Withdrawal Amount: | .15 X ($10,000.00) = $1,500.00 | ||||||||||||||||
Step 3. Calculate the Withdrawal Charge | = .06 X ($10,000 - $1,500) = $510.00 | ||||||||||||||||
Step 4. Calculate the Market Value Adjustment: | I = | 4.50% | |||||||||||||||
J = | 4.80% | ||||||||||||||||
N = | 730 days | = 2 | |||||||||||||||
365 days | |||||||||||||||||
Market Value Adjustment Factor: .9 X [I - (J + .0025)] X N = .9 X [.045 - (.048 + .0025)] X 2 = .0099 | |||||||||||||||||
Market Value Adjustment = Market Value Adjustment Factor X Amount Subject to Market Value Adjustment: | |||||||||||||||||
Step 5. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | = -.0099 X ($11,411.66 - $1,500.00) = - ($98.13) | ||||||||||||||||
$11,411.66 - $510.00 - $98.13 = $10,803.53 |
Step 1. Calculate Contract Value at End of Contract Year 3: | $10,400.00 X (1.045)/3 = $11,868.13 | ||||||||||||||||
Step 2. Calculate the Free Withdrawal Amount: | .15 X($10,000.00) = $1,500.00 | ||||||||||||||||
Step 3. Calculate the Withdrawal Charge: | =.08 X($10,000 - $1,500) = $680 | ||||||||||||||||
Step 4. Calculate the Market Value Adjustment: | I = | 4.5% | |||||||||||||||
J = | 4.2% | ||||||||||||||||
N = | 730 days | = 2 | |||||||||||||||
365 days | |||||||||||||||||
Market Value Adjustment Factor: .9 X [I - (J + .0025)] X N | |||||||||||||||||
= .9 X [.045 - (.042 + .0025)] X 2 = - .0009 | |||||||||||||||||
Market Value Adjustment = Market Value Adjustment Factor X Amount Subject to Market Value Adjustment: | |||||||||||||||||
= .0009 X ($11,868.13 - $1,500.00) = $9.33 | |||||||||||||||||
Step 5. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | |||||||||||||||||
$11,868.13 - $680.00 + $9.33 = $11,197.46 |
Step 1. Calculate Contract Value at End of Contract Year 3: | $10,400.00 X (1.045)/3 = $11,868.13 | ||||||||||||||||
Step 2. Calculate the Free Withdrawal Amount: | .15 X ($10,000.00) = $1,500.00 | ||||||||||||||||
Step 3. Calculate the Withdrawal Charge: | = .08 X ($10,000 - $1,500) = $680 | ||||||||||||||||
Step 4. Calculate the Market Value Adjustment: | I = | 4.5% | |||||||||||||||
J = | 4.8% | ||||||||||||||||
N = | 730 days | = 2 | |||||||||||||||
365 days | |||||||||||||||||
Market Value Adjustment Factor: .9 X [I - (J + .0025)] X N | |||||||||||||||||
= .9 X [.045 - (.048 + .0025)] X 2 = -.0099 | |||||||||||||||||
Market Value Adjustment = Market Value Adjustment Factor X Amount Subject to Market Value Adjustment: | |||||||||||||||||
= -.0099 X ($11,868.13 - $1,500.00) | |||||||||||||||||
= ($102.64) | |||||||||||||||||
Step 5. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | $11,868.13 - $680.00 - $102.64 = $11,085.49 |
Purchase Payment: | $10,000 allocated to a Guarantee Period | |||||||
Guarantee Period: | 5 years | |||||||
Interest Rate: | 4.50% | |||||||
Full Withdrawal: | End of Contract Year 3 |
Step 1: Calculate Contract Value at End of Contract Year 3: | = $10,000.00 X (1.045)/3 = $11,411.66 | |||||||||||||||||||
Step 2: Calculate the Free Withdrawal Amount: | = .15 X $10,920.25* = $1,638.04 | |||||||||||||||||||
Step 3: Calculate the Withdrawal Charge: | = .07 X ($10,000 - $1,638.04) = $585.34 | |||||||||||||||||||
Step 4: Calculate the Market Value Adjustment: | I = | 4.50% | ||||||||||||||||||
J = | 4.20% | |||||||||||||||||||
N = | 730 DAYS | = 2 | ||||||||||||||||||
365 DAYS | ||||||||||||||||||||
Market Value Adjustment Factor: .9 X | ||||||||||||||||||||
[I - (J + .0025)] X N’ | ||||||||||||||||||||
= .9 X [.045 - (.042 + .0025)] X 2 = | ||||||||||||||||||||
0.0009 | ||||||||||||||||||||
Market Value Adjustment = Market | ||||||||||||||||||||
Value Adjustment Factor X Amount | ||||||||||||||||||||
Subject To Market Value Adjustment: | ||||||||||||||||||||
= .0009 X$11,411.66 = $10.27 | ||||||||||||||||||||
Step 5. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | = $11,411.66 - $585.34 + $10.27 = Year 3: $10,836.59 |
* | Contract Value at End of Contract Year 2 |
Step 1: Calculate Contract Value at End of Contract Year 3: | = $10,000.00 X (1.045)/3 = $11,411.66 | ||||||||||||||||
Step 2: Calculate The Free Withdrawal Amount: | = .15 X $10,920.25* = $1,638.04 | ||||||||||||||||
Step 3: Calculate the Withdrawal Charge: | = 0.7 X ($10,000 - $1,638.04) = $585.34 | ||||||||||||||||
Step 4: Calculate the Market Value Adjustment: | I = | 4.50% | |||||||||||||||
J = | 4.80% | ||||||||||||||||
N = | 730 DAYS | = 2 | |||||||||||||||
365 DAYS | |||||||||||||||||
Market Value Adjustment Factor: | |||||||||||||||||
.9 X [I - (J + .0025)] X N = | |||||||||||||||||
.9 X [(.045 - (.048 | |||||||||||||||||
+ .0025)] X (2) = -.0099 | |||||||||||||||||
Market Value Adjustment = | |||||||||||||||||
Market Value Adjustment Factor | |||||||||||||||||
X Amount Subject To | |||||||||||||||||
Market Value Adjustment: = | |||||||||||||||||
-.0099 X $11,411.66 = -($112.98) | |||||||||||||||||
Step 5. Calculate the amount received by a Contract owner as a result of full withdrawal at the end of Contract Year 3: | $11,411.66 - $585.34 - $112.98 = $10,713.35 |
Distribution Channels | Proprietary Products | Target Customers | ||||||
Allstate exclusive agents and exclusive financial specialists | Term life insurance Whole life insurance Interest-sensitive life insurance Variable life insurance | Middle market consumers with family and financial protection needs | ||||||
Workplace enrolling independent agents and benefits brokers in New York | Workplace voluntary accident and health insurance: Short-term disability income insurance Accident and critical illness insurance | Middle market consumers in New York with family financial protection needs employed by small, medium, and large size firms |
New York | 28.0 | % | |||
California | 8.6 | ||||
Texas | 7.4 | ||||
Florida | 6.0 | ||||
Illinois | 5.2 |
Page | |||||
($ in millions) | Year Ended December 31, | ||||||||||||||||
2020 | 2019 | 2018 | |||||||||||||||
Revenues | |||||||||||||||||
Premiums (net of reinsurance ceded of $ | $ | $ | $ | ||||||||||||||
Contract charges (net of reinsurance ceded of $ | |||||||||||||||||
Other revenue | |||||||||||||||||
Net investment income | |||||||||||||||||
Realized capital gains and losses | ( | ||||||||||||||||
Total revenues | |||||||||||||||||
Costs and expenses | |||||||||||||||||
Contract benefits (net of reinsurance ceded of $ | |||||||||||||||||
Interest credited to contractholder funds (net of reinsurance ceded of $ | |||||||||||||||||
Amortization of deferred policy acquisition costs | |||||||||||||||||
Operating costs and expenses | |||||||||||||||||
Restructuring and related charges | |||||||||||||||||
Interest expense | |||||||||||||||||
Total costs and expenses | |||||||||||||||||
Gain on disposition of operations | |||||||||||||||||
Income from operations before income tax expense | |||||||||||||||||
Income tax expense | |||||||||||||||||
Net income | |||||||||||||||||
Other comprehensive income (loss), after-tax | |||||||||||||||||
Change in unrealized net capital gains and losses | ( | ||||||||||||||||
Change in unrealized foreign currency translation adjustments | ( | ||||||||||||||||
Other comprehensive income (loss), after-tax | ( | ||||||||||||||||
Comprehensive income | $ | $ | $ |
($ in millions, except par value data) | December 31, | ||||||||||
2020 | 2019 | ||||||||||
Assets | |||||||||||
Investments | |||||||||||
Fixed income securities, at fair value (amortized cost, net $ | $ | $ | |||||||||
Mortgage loans, net | |||||||||||
Equity securities, at fair value (cost $ | |||||||||||
Limited partnership interests | |||||||||||
Short-term, at fair value (amortized cost $ | |||||||||||
Policy loans | |||||||||||
Other, net | |||||||||||
Total investments | |||||||||||
Cash | |||||||||||
Deferred policy acquisition costs | |||||||||||
Reinsurance recoverable from non-affiliates | |||||||||||
Reinsurance recoverable from affiliates | |||||||||||
Accrued investment income | |||||||||||
Other assets, net | |||||||||||
Separate Accounts | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities | |||||||||||
Contractholder funds | $ | $ | |||||||||
Reserve for life-contingent contract benefits | |||||||||||
Unearned premiums | |||||||||||
Payable to affiliates, net | |||||||||||
Other liabilities and accrued expenses | |||||||||||
Deferred income taxes | |||||||||||
Notes due to related parties | |||||||||||
Separate Accounts | |||||||||||
Total liabilities | |||||||||||
Commitments and Contingent Liabilities (Notes 7 and 11) | |||||||||||
Shareholder’s Equity | |||||||||||
Redeemable preferred stock - series A, $ | |||||||||||
Redeemable preferred stock - series B, $ | |||||||||||
Common stock, $ | |||||||||||
Additional capital paid-in | |||||||||||
Retained income | |||||||||||
Accumulated other comprehensive income: | |||||||||||
Unrealized net capital gains and losses on fixed income securities with credit losses | |||||||||||
Other unrealized net capital gains and losses | |||||||||||
Unrealized adjustment to DAC, DSI and insurance reserves | ( | ( | |||||||||
Total unrealized net capital gains and losses | |||||||||||
Unrealized foreign currency translation adjustments | ( | ||||||||||
Total accumulated other comprehensive income (“AOCI”) | |||||||||||
Total shareholder’s equity | |||||||||||
Total liabilities and shareholder’s equity | $ | $ |
($ in millions) | Year Ended December 31, | ||||||||||||||||
2020 | 2019 | 2018 | |||||||||||||||
Common stock | $ | $ | $ | ||||||||||||||
Additional capital paid-in | |||||||||||||||||
Balance, beginning of year | |||||||||||||||||
Gain on reinsurance with an affiliate | |||||||||||||||||
Balance, end of year | |||||||||||||||||
Retained income | |||||||||||||||||
Balance, beginning of year | |||||||||||||||||
Net income | |||||||||||||||||
Dividends | ( | ( | |||||||||||||||
Cumulative effect of change in accounting principle | ( | — | |||||||||||||||
Balance, end of year | |||||||||||||||||
Accumulated other comprehensive income | |||||||||||||||||
Balance, beginning of year | |||||||||||||||||
Change in unrealized net capital gains and losses | ( | ||||||||||||||||
Change in unrealized foreign currency translation adjustments | ( | ||||||||||||||||
Cumulative effect of change in accounting principle | — | — | ( | ||||||||||||||
Balance, end of year | |||||||||||||||||
Total shareholder’s equity | $ | $ | $ |
($ in millions) | Year Ended December 31, | ||||||||||||||||
2020 | 2019 | 2018 | |||||||||||||||
Cash flows from operating activities | |||||||||||||||||
Net income | $ | $ | $ | ||||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||
Amortization and other non-cash items | ( | ( | ( | ||||||||||||||
Realized capital gains and losses | ( | ( | |||||||||||||||
Gain on disposition of operations | ( | ( | ( | ||||||||||||||
Interest credited to contractholder funds | |||||||||||||||||
Changes in: | |||||||||||||||||
Policy benefits and other insurance reserves | ( | ( | ( | ||||||||||||||
Deferred policy acquisition costs | |||||||||||||||||
Reinsurance recoverables, net | |||||||||||||||||
Income taxes | ( | ( | |||||||||||||||
Other operating assets and liabilities | |||||||||||||||||
Net cash provided by operating activities | |||||||||||||||||
Cash flows from investing activities | |||||||||||||||||
Proceeds from sales | |||||||||||||||||
Fixed income securities | |||||||||||||||||
Equity securities | |||||||||||||||||
Limited partnership interests | |||||||||||||||||
Mortgage loans | |||||||||||||||||
Other investments | |||||||||||||||||
Investment collections | |||||||||||||||||
Fixed income securities | |||||||||||||||||
Mortgage loans | |||||||||||||||||
Other investments | |||||||||||||||||
Investment purchases | |||||||||||||||||
Fixed income securities | ( | ( | ( | ||||||||||||||
Equity securities | ( | ( | ( | ||||||||||||||
Limited partnership interests | ( | ( | ( | ||||||||||||||
Mortgage loans | ( | ( | ( | ||||||||||||||
Other investments | ( | ( | ( | ||||||||||||||
Change in short-term investments, net | ( | ( | |||||||||||||||
Change in policy loans and other investments, net | ( | ( | |||||||||||||||
Net cash provided by investing activities | |||||||||||||||||
Cash flows from financing activities | |||||||||||||||||
Contractholder fund deposits | |||||||||||||||||
Contractholder fund withdrawals | ( | ( | ( | ||||||||||||||
Proceeds from issuance of notes to related parties | |||||||||||||||||
Repayment of notes to related parties | ( | ||||||||||||||||
Dividends paid | ( | ( | |||||||||||||||
Other | |||||||||||||||||
Net cash used in financing activities | ( | ( | ( | ||||||||||||||
Net decrease in cash | ( | ( | ( | ||||||||||||||
Cash at beginning of year | |||||||||||||||||
Cash at end of year | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Premiums | |||||||||||||||||
Traditional life insurance | $ | $ | $ | ||||||||||||||
Accident and health insurance | |||||||||||||||||
Total premiums | |||||||||||||||||
Contract charges | |||||||||||||||||
Interest-sensitive life insurance | |||||||||||||||||
Fixed annuities | |||||||||||||||||
Total contract charges | |||||||||||||||||
Total premiums and contract charges | $ | $ | $ |
($ in millions) | December 31, 2020 | January 1, 2020 | ||||||||||||
Fixed income securities | $ | $ | ||||||||||||
Mortgage loans | ||||||||||||||
Other investments | ||||||||||||||
Bank loans | ||||||||||||||
Agent loans | ||||||||||||||
Investments | ||||||||||||||
Reinsurance recoverables | ||||||||||||||
Other assets | ||||||||||||||
Assets | ||||||||||||||
Commitments to fund mortgage loans, bank loans and agent loans | ||||||||||||||
Liabilities | ||||||||||||||
Total | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Net change in proceeds managed | |||||||||||||||||
Net change in fixed income securities | $ | $ | $ | ||||||||||||||
Net change in short-term investments | ( | ( | |||||||||||||||
Operating cash flow provided (used) | ( | ||||||||||||||||
Net change in cash | |||||||||||||||||
Net change in proceeds managed | $ | $ | ( | $ | |||||||||||||
Net change in liabilities | |||||||||||||||||
Liabilities for collateral, beginning of year | $ | ( | $ | ( | $ | ( | |||||||||||
Liabilities for collateral, end of year | ( | ( | ( | ||||||||||||||
Operating cash flow (used) provided | $ | ( | $ | $ | ( |
($ in millions) | December 31, 2020 | December 31, 2019 | |||||||||
Class A Notes, Due March 10, 2037 (1) | |||||||||||
Allstate New Jersey Insurance Company | $ | $ | |||||||||
American Heritage Life Insurance Company | |||||||||||
Allstate Assurance Company | |||||||||||
First Colonial Insurance Company | |||||||||||
Allstate Fire & Casualty Insurance Company | |||||||||||
Allstate Property and Casualty Insurance Company | |||||||||||
Allstate Indemnity Company | |||||||||||
Esurance Insurance Company | |||||||||||
North Light Specialty Insurance Company | |||||||||||
Allstate Vehicle and Property Insurance Company | |||||||||||
Allstate New Jersey Property and Casualty Insurance Company | |||||||||||
Esurance Property and Casualty Insurance Company | |||||||||||
Subtotal - Class A | |||||||||||
Class B Deferrable Notes, Due March 10, 2037 | |||||||||||
Allstate Life Insurance Company | |||||||||||
Class C Deferrable Notes, Due March 10, 2037 | |||||||||||
Allstate Life Insurance Company | |||||||||||
Subordinated Notes, Due March 10, 2037 | |||||||||||
Allstate Life Insurance Company | |||||||||||
Total | $ | $ |
As of December 31, | ||||||||||||||
($ in millions) | 2020 | 2019 | ||||||||||||
Fixed income securities, at fair value | $ | $ | ||||||||||||
Mortgage loans, net | ||||||||||||||
Equity securities, at fair value | ||||||||||||||
Limited partnership interests | ||||||||||||||
Short-term investments, at fair value | ||||||||||||||
Policy loans | ||||||||||||||
Other, net | ||||||||||||||
Total | $ | $ |
($ in millions) | Amortized cost, net | Gross unrealized | Fair value | ||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||
U.S. government and agencies | $ | $ | $ | $ | |||||||||||||||||||
Municipal | |||||||||||||||||||||||
Corporate | ( | ||||||||||||||||||||||
Foreign government | |||||||||||||||||||||||
ABS | ( | ||||||||||||||||||||||
MBS | |||||||||||||||||||||||
Total fixed income securities | $ | $ | $ | ( | $ | ||||||||||||||||||
December 31, 2019 | |||||||||||||||||||||||
U.S. government and agencies | $ | $ | $ | $ | |||||||||||||||||||
Municipal | ( | ||||||||||||||||||||||
Corporate | ( | ||||||||||||||||||||||
Foreign government | |||||||||||||||||||||||
ABS | ( | ||||||||||||||||||||||
MBS | ( | ||||||||||||||||||||||
Total fixed income securities | $ | $ | $ | ( | $ |
($ in millions) | As of December 31, 2020 | ||||||||||
Amortized cost, net | Fair value | ||||||||||
Due in one year or less | $ | $ | |||||||||
Due after one year through five years | |||||||||||
Due after five years through ten years | |||||||||||
Due after ten years | |||||||||||
ABS and MBS | |||||||||||
Total | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Fixed income securities | $ | $ | $ | ||||||||||||||
Mortgage loans | |||||||||||||||||
Equity securities | |||||||||||||||||
Limited partnership interests | |||||||||||||||||
Short-term investments | |||||||||||||||||
Policy loans | |||||||||||||||||
Other | |||||||||||||||||
Investment income, before expense | |||||||||||||||||
Investment expense | ( | ( | ( | ||||||||||||||
Net investment income | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Fixed income securities | $ | $ | $ | ( | |||||||||||||
Mortgage loans | ( | ||||||||||||||||
Equity securities | ( | ||||||||||||||||
Limited partnership interests | ( | ||||||||||||||||
Derivatives | |||||||||||||||||
Other | ( | ( | ( | ||||||||||||||
Realized capital gains (losses) | $ | $ | $ | ( |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Sales | $ | $ | $ | ( | |||||||||||||
Credit losses (1) | ( | ( | ( | ||||||||||||||
Valuation of equity investments (2) | ( | ||||||||||||||||
Valuation and settlements of derivative instruments | |||||||||||||||||
Realized capital gains (losses) | $ | $ | $ | ( |
($ in millions) | 2020 | 2019 | 2018 | |||||||||||||||||
Gross realized gains | $ | $ | $ | |||||||||||||||||
Gross realized losses | ( | ( | ( |
For the years ended December 31, | |||||||||||
($ in millions) | 2020 | 2019 | |||||||||
Equity securities | $ | $ | |||||||||
Limited partnership interests carried at fair value | |||||||||||
Total | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | |||||||||||||||||
Fixed income securities: | ||||||||||||||||||||
Corporate | $ | $ | ( | $ | ( | |||||||||||||||
ABS | ( | ( | ( | |||||||||||||||||
MBS | ( | ( | ( | |||||||||||||||||
Total fixed income securities | ( | ( | ( | |||||||||||||||||
Mortgage loans | ( | |||||||||||||||||||
Limited partnership interests | ( | ( | ||||||||||||||||||
Other investments | ||||||||||||||||||||
Bank loans | ( | ( | ||||||||||||||||||
Agent loans | ( | ( | ||||||||||||||||||
Total credit losses by asset type | $ | ( | $ | ( | $ | ( | ||||||||||||||
Liabilities | ||||||||||||||||||||
Commitments to fund commercial mortgage loans, bank loans and agent loans | ||||||||||||||||||||
Total | $ | ( | $ | ( | $ | ( |
($ in millions) | Fair value | Gross unrealized | Unrealized net gains (losses) | ||||||||||||||||||||
December 31, 2020 | Gains | Losses | |||||||||||||||||||||
Fixed income securities | $ | $ | $ | ( | $ | ||||||||||||||||||
Short-term investments | |||||||||||||||||||||||
EMA limited partnerships (1) | ( | ||||||||||||||||||||||
Unrealized net capital gains and losses, pre-tax | |||||||||||||||||||||||
Amounts recognized for: | |||||||||||||||||||||||
Insurance reserves (2) | ( | ||||||||||||||||||||||
DAC and DSI (3) | ( | ||||||||||||||||||||||
Amounts recognized | ( | ||||||||||||||||||||||
Deferred income taxes | ( | ||||||||||||||||||||||
Unrealized net capital gains and losses, after-tax | $ | ||||||||||||||||||||||
December 31, 2019 | |||||||||||||||||||||||
Fixed income securities | $ | $ | $ | ( | $ | ||||||||||||||||||
Short-term investments | |||||||||||||||||||||||
EMA limited partnerships | ( | ||||||||||||||||||||||
Unrealized net capital gains and losses, pre-tax | |||||||||||||||||||||||
Amounts recognized for: | |||||||||||||||||||||||
Insurance reserves | ( | ||||||||||||||||||||||
DAC and DSI | ( | ||||||||||||||||||||||
Amounts recognized | ( | ||||||||||||||||||||||
Deferred income taxes | ( | ||||||||||||||||||||||
Unrealized net capital gains and losses, after-tax | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Fixed income securities | $ | $ | $ | ( | |||||||||||||
Short-term investments | |||||||||||||||||
Derivative instruments | ( | ||||||||||||||||
EMA limited partnerships | ( | ( | |||||||||||||||
Total | ( | ||||||||||||||||
Amounts recognized for: | |||||||||||||||||
Insurance reserves | ( | ( | |||||||||||||||
DAC and DSI | ( | ( | |||||||||||||||
Amounts recognized | ( | ( | |||||||||||||||
Deferred income taxes | ( | ( | |||||||||||||||
Increase (decrease) in unrealized net capital gains and losses, after-tax | $ | $ | $ | ( |
(% of mortgage loan portfolio carrying value) | 2020 | 2019 | |||||||||
Texas | % | % | |||||||||
California | |||||||||||
Illinois | |||||||||||
Florida | |||||||||||
North Carolina | |||||||||||
New Jersey |
(% of mortgage loan portfolio carrying value) | 2020 | 2019 | |||||||||
Apartment complex | % | % | |||||||||
Office buildings | |||||||||||
Retail | |||||||||||
Warehouse | |||||||||||
Other | |||||||||||
Total | % | % |
($ in millions) | Number of loans | Amortized cost, net | Percent | ||||||||||||||
2021 | $ | % | |||||||||||||||
2022 | |||||||||||||||||
2023 | |||||||||||||||||
2024 | |||||||||||||||||
Thereafter | |||||||||||||||||
Total | $ | % |
2020 | 2019 | |||||||||||||||||||||||||||||||||||||
($ in millions) | EMA | Fair Value | Total | EMA | Fair Value | Total | ||||||||||||||||||||||||||||||||
Private equity | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Real estate | ||||||||||||||||||||||||||||||||||||||
Other (1) | ||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
(% of municipal bond portfolio carrying value) | 2020 | 2019 | |||||||||
Texas | % | % | |||||||||
California | |||||||||||
Oregon | |||||||||||
New Jersey | |||||||||||
Illinois | |||||||||||
New York |
As of December 31, | ||||||||||||||
($ in millions) | 2020 | 2019 | ||||||||||||
Agent loans, net | $ | $ | ||||||||||||
Real estate | ||||||||||||||
Bank loans, net | ||||||||||||||
Derivatives and other | ||||||||||||||
Total | $ | $ |
($ in millions) | 2020 | |||||||
Beginning balance | $ | |||||||
Credit losses on securities for which credit losses not previously reported | ( | |||||||
Reduction of allowance related to sales | ||||||||
Write-offs | ||||||||
Ending balance (1) | $ | ( |
($ in millions) | Less than 12 months | 12 months or more | Total unrealized losses | ||||||||||||||||||||||||||||||||||||||
Number of issues | Fair value | Unrealized losses | Number of issues | Fair value | Unrealized losses | ||||||||||||||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||||||||||||||
U.S. government and agencies | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||
Municipal | |||||||||||||||||||||||||||||||||||||||||
Corporate | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
ABS | ( | ( | |||||||||||||||||||||||||||||||||||||||
MBS | |||||||||||||||||||||||||||||||||||||||||
Total fixed income securities | $ | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||
Investment grade fixed income securities | $ | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||
Below investment grade fixed income securities | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Total fixed income securities | $ | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||
December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||||||||||||||
U.S. government and agencies | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||
Municipal | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Corporate | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
ABS | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
MBS | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total fixed income securities | $ | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||
Investment grade fixed income securities | $ | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||
Below investment grade fixed income securities | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
Total fixed income securities | $ | $ | ( | $ | $ | ( | $ | ( |
($ in millions) | Investment grade | Below investment grade | Total | ||||||||||||||
Fixed income securities with unrealized loss position less than 20% of amortized cost, net (1) (2) | $ | ( | $ | ( | $ | ( | |||||||||||
Fixed income securities with unrealized loss position greater than or equal to 20% of amortized cost, net (3) (4) | ( | ( | ( | ||||||||||||||
Total unrealized losses | $ | ( | $ | ( | $ | ( |
($ in millions) | 2020 | 2019 | |||||||||||||||||||||||||||||||||||||||||||||
2015 and prior | 2016 | 2017 | 2018 | 2019 | Current | Total | Total | ||||||||||||||||||||||||||||||||||||||||
Below 1.0 | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
1.0 - 1.25 | |||||||||||||||||||||||||||||||||||||||||||||||
1.26 - 1.50 | |||||||||||||||||||||||||||||||||||||||||||||||
Above 1.50 | |||||||||||||||||||||||||||||||||||||||||||||||
Amortized cost before allowance | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Allowance (1) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Amortized cost, net | $ | $ |
($ in millions) | 2020 | ||||
Beginning balance | $ | ( | |||
Cumulative effect of change in accounting principle | ( | ||||
Net increases related to credit losses | ( | ||||
Reduction of allowance related to sales | |||||
Loans transferred due to reinsurance agreement with AAC | ( | ||||
Write-offs | |||||
Ending balance | $ | ( |
($ in millions) | 2020 | ||||||||||||||||||||||||||||||||||||||||
2015 and Prior | 2016 | 2017 | 2018 | 2019 | Current | Total | |||||||||||||||||||||||||||||||||||
BBB | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
BB | |||||||||||||||||||||||||||||||||||||||||
B | |||||||||||||||||||||||||||||||||||||||||
CCC and below | |||||||||||||||||||||||||||||||||||||||||
Amortized cost before allowance | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Allowance | ( | ||||||||||||||||||||||||||||||||||||||||
Amortized cost, net | $ |
($ in millions) | 2020 | ||||
Beginning balance | $ | ||||
Cumulative effect of change in accounting principle | ( | ||||
Net increases related to credit losses | ( | ||||
Reduction of allowance related to sales | |||||
Write-offs | |||||
Ending balance | $ | ( |
($ in millions) | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | Counterparty and cash collateral netting | Total | ||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||||||
U.S. government and agencies | $ | $ | $ | $ | |||||||||||||||||||||||||
Municipal | |||||||||||||||||||||||||||||
Corporate - public | |||||||||||||||||||||||||||||
Corporate - privately placed | |||||||||||||||||||||||||||||
Foreign government | |||||||||||||||||||||||||||||
ABS | |||||||||||||||||||||||||||||
MBS | |||||||||||||||||||||||||||||
Total fixed income securities | |||||||||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Short-term investments | |||||||||||||||||||||||||||||
Other investments: Free-standing derivatives | $ | ( | |||||||||||||||||||||||||||
Separate account assets | |||||||||||||||||||||||||||||
Total recurring basis assets | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
% of total assets at fair value | % | % | % | % | % | ||||||||||||||||||||||||
Investments reported at NAV | |||||||||||||||||||||||||||||
Total | $ | ||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||
Contractholder funds: Derivatives embedded in life and annuity contracts | $ | $ | $ | ( | $ | ( | |||||||||||||||||||||||
Other liabilities: Free-standing derivatives | ( | $ | ( | ||||||||||||||||||||||||||
Total recurring basis liabilities | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||
% of total liabilities at fair value | % | % | % | ( | % | % |
($ in millions) | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | Counterparty and cash collateral netting | Total | ||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||||||
U.S. government and agencies | $ | $ | $ | $ | |||||||||||||||||||||||||
Municipal | |||||||||||||||||||||||||||||
Corporate - public | |||||||||||||||||||||||||||||
Corporate - privately placed | |||||||||||||||||||||||||||||
Foreign government | |||||||||||||||||||||||||||||
ABS | |||||||||||||||||||||||||||||
MBS | |||||||||||||||||||||||||||||
Total fixed income securities | |||||||||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Short-term investments | |||||||||||||||||||||||||||||
Other investments: Free-standing derivatives | $ | ( | |||||||||||||||||||||||||||
Separate account assets | |||||||||||||||||||||||||||||
Total recurring basis assets | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
% of total assets at fair value | % | % | % | % | % | ||||||||||||||||||||||||
Investments reported at NAV | |||||||||||||||||||||||||||||
Total | $ | ||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||
Contractholder funds: Derivatives embedded in life and annuity contracts | $ | $ | $ | ( | $ | ( | |||||||||||||||||||||||
Other liabilities: Free-standing derivatives | ( | $ | ( | ||||||||||||||||||||||||||
Total recurring basis liabilities | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||
% of total liabilities at fair value | % | % | % | ( | % | % |
($ in millions) | Fair value | Valuation technique | Unobservable input | Range | Weighted average | ||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts – Equity-indexed and forward starting options | $ | ( | Stochastic cash flow model | Projected option cost | % | ||||||||||||||||||||||||
December 31, 2019 | |||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts – Equity-indexed and forward starting options | $ | ( | Stochastic cash flow model | Projected option cost | % |
($ in millions) | Total gains (losses) included in: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2019 | Net income | OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issues | Settlements | Balance as of December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Municipal | $ | $ | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Corporate - public | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate - privately placed | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
ABS | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
MBS | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total fixed income securities | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity securities | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Free-standing derivatives, net | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contractholder funds: Derivatives embedded in life and annuity contracts | $ | ( | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | ( | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | ( |
($ in millions) | Net investment income | Realized capital gains and losses | Contract benefits | Interest credited to contractholder funds | Total | |||||||||||||||||||||||||||
Components of net income | $ | ( | $ | $ | ( | $ | ( | $ | ( |
($ in millions) | Total gains (losses) included in: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2018 | Net income | OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issues | Settlements | Balance as of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Municipal | $ | $ | $ | $ | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Corporate - public | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate - privately placed | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
ABS | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
MBS | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total fixed income securities | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity securities | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Free-standing derivatives, net | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | $ | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contractholder funds: Derivatives embedded in life and annuity contracts | $ | ( | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | ( | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | ( |
($ in millions) | Net investment income | Realized capital gains and losses | Contract benefits | Interest credited to contractholder funds | Total | |||||||||||||||||||||||||||
Components of net income | $ | ( | $ | $ | $ | ( | $ | ( |
($ in millions) | Total gains (losses) included in: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2017 | Net income | OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issues | Settlements | Balance as of December 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fixed income securities: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Municipal | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||
Corporate - public | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate - privately placed | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ABS | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total fixed income securities | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity securities | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Free-standing derivatives, net | (1) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contractholder funds: Derivatives embedded in life and annuity contracts | $ | ( | $ | $ | $ | $ | $ | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | ( | $ | $ | $ | $ | $ | $ | $ | ( | $ | $ | ( |
($ in millions) | Net investment income | Realized capital gains and losses | Contract benefits | Interest credited to contractholder funds | Total | |||||||||||||||||||||||||||
Components of net income | $ | $ | $ | ( | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Assets | |||||||||||||||||
Fixed income securities: | |||||||||||||||||
Municipal | $ | $ | $ | ||||||||||||||
Corporate - public | |||||||||||||||||
Corporate - privately placed | |||||||||||||||||
Total fixed income securities | |||||||||||||||||
Equity securities | ( | ||||||||||||||||
Free-standing derivatives, net | ( | ||||||||||||||||
Total recurring Level 3 assets | $ | $ | $ | ||||||||||||||
Liabilities | |||||||||||||||||
Contractholder funds: Derivatives embedded in life and annuity contracts | $ | ( | $ | ( | $ | ||||||||||||
Total recurring Level 3 liabilities | $ | ( | $ | ( | $ | ||||||||||||
Total included in net income | $ | ( | $ | ( | $ | ||||||||||||
Components of net income | |||||||||||||||||
Net investment income | $ | ( | $ | ( | $ | ||||||||||||
Realized capital gains (losses) | |||||||||||||||||
Contract benefits | ( | ( | |||||||||||||||
Interest credited to contractholder funds | ( | ( | |||||||||||||||
Total included in net income | $ | ( | $ | ( | $ | ||||||||||||
Assets | |||||||||||||||||
Municipal | $ | ||||||||||||||||
Corporate - public | |||||||||||||||||
Corporate - privately placed | ( | ||||||||||||||||
Changes in unrealized net capital gains and losses reported in OCI (1) | $ | ( |
($ in millions) | December 31, 2020 | December 31, 2019 | ||||||||||||||||||||||||||||||
Financial assets | Fair value level | Amortized cost, net | Fair value | Amortized cost, net | Fair value | |||||||||||||||||||||||||||
Mortgage loans | Level 3 | $ | $ | $ | $ | |||||||||||||||||||||||||||
Bank loans | Level 3 | |||||||||||||||||||||||||||||||
Agent loans | Level 3 | |||||||||||||||||||||||||||||||
Financial liabilities | Fair value level | Carrying value (1) | Fair value | Carrying value (1) | Fair value | |||||||||||||||||||||||||||
Contractholder funds on investment contracts | Level 3 | $ | $ | $ | $ | |||||||||||||||||||||||||||
Liability for collateral | Level 2 | |||||||||||||||||||||||||||||||
Notes due to related parties | Level 3 |
($ in millions, except number of contracts) | Volume (1) | ||||||||||||||||||||||||||||||||||
Balance sheet location | Notional amount | Number of contracts | Fair value, net | Gross asset | Gross liability | ||||||||||||||||||||||||||||||
Asset derivatives | |||||||||||||||||||||||||||||||||||
Derivatives designated as fair value accounting hedging instruments | |||||||||||||||||||||||||||||||||||
Other | Other assets | $ | n/a | $ | $ | $ | |||||||||||||||||||||||||||||
Derivatives not designated as accounting hedging instruments | |||||||||||||||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||||||||||||||
Interest rate cap agreements | Other investments | n/a | |||||||||||||||||||||||||||||||||
Futures | Other assets | n/a | |||||||||||||||||||||||||||||||||
Equity and index contracts | |||||||||||||||||||||||||||||||||||
Options | Other investments | n/a | |||||||||||||||||||||||||||||||||
Futures | Other assets | n/a | |||||||||||||||||||||||||||||||||
Total return index contracts | |||||||||||||||||||||||||||||||||||
Total return swap agreements - equity index | Other investments | n/a | |||||||||||||||||||||||||||||||||
Foreign currency contracts | |||||||||||||||||||||||||||||||||||
Foreign currency forwards | Other investments | n/a | ( | ||||||||||||||||||||||||||||||||
Embedded derivative financial instruments | |||||||||||||||||||||||||||||||||||
Other embedded derivative financial instruments | Other investments | n/a | |||||||||||||||||||||||||||||||||
Credit default contracts | |||||||||||||||||||||||||||||||||||
Credit default swaps - buying protection | Other investments | n/a | ( | ( | |||||||||||||||||||||||||||||||
Credit default swaps - selling protection | Other investments | n/a | |||||||||||||||||||||||||||||||||
Subtotal | ( | ||||||||||||||||||||||||||||||||||
Total asset derivatives | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||
Liability derivatives | |||||||||||||||||||||||||||||||||||
Derivatives not designated as accounting hedging instruments | |||||||||||||||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||||||||||||||
Interest rate cap agreements | Other liabilities & accrued expenses | $ | n/a | $ | $ | $ | |||||||||||||||||||||||||||||
Futures | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Equity and index contracts | |||||||||||||||||||||||||||||||||||
Options | Other liabilities & accrued expenses | n/a | ( | ( | |||||||||||||||||||||||||||||||
Foreign currency contracts | |||||||||||||||||||||||||||||||||||
Foreign currency forwards | Other liabilities & accrued expenses | n/a | ( | ( | |||||||||||||||||||||||||||||||
Embedded derivative financial instruments | |||||||||||||||||||||||||||||||||||
Guaranteed accumulation benefits | Contractholder funds | n/a | ( | ( | |||||||||||||||||||||||||||||||
Guaranteed withdrawal benefits | Contractholder funds | n/a | ( | ( | |||||||||||||||||||||||||||||||
Equity-indexed and forward starting options in life and annuity product contracts | Contractholder funds | n/a | ( | ( | |||||||||||||||||||||||||||||||
Credit default contracts | |||||||||||||||||||||||||||||||||||
Credit default swaps - selling protection | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Total liability derivatives | ( | $ | $ | ( | |||||||||||||||||||||||||||||||
Total derivatives | $ | $ | ( |
($ in millions, except number of contracts) | Volume | ||||||||||||||||||||||||||||||||||
Balance sheet location | Notional amount | Number of contracts | Fair value, net | Gross asset | Gross liability | ||||||||||||||||||||||||||||||
Asset derivatives | |||||||||||||||||||||||||||||||||||
Derivatives designated as accounting hedging instruments | |||||||||||||||||||||||||||||||||||
Other | Other assets | $ | n/a | $ | $ | $ | |||||||||||||||||||||||||||||
Derivatives not designated as accounting hedging instruments | |||||||||||||||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||||||||||||||
Futures | Other assets | n/a | |||||||||||||||||||||||||||||||||
Equity and index contracts | |||||||||||||||||||||||||||||||||||
Options | Other investments | n/a | |||||||||||||||||||||||||||||||||
Futures | Other assets | n/a | |||||||||||||||||||||||||||||||||
Total return index contracts | |||||||||||||||||||||||||||||||||||
Total return swap agreements - fixed income | Other investments | n/a | |||||||||||||||||||||||||||||||||
Credit default contracts | |||||||||||||||||||||||||||||||||||
Credit default swaps - buying protection | Other investments | n/a | |||||||||||||||||||||||||||||||||
Subtotal | |||||||||||||||||||||||||||||||||||
Total asset derivatives | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Liability derivatives | |||||||||||||||||||||||||||||||||||
Derivatives not designated as accounting hedging instruments | |||||||||||||||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||||||||||||||
Interest rate cap agreements | Other liabilities & accrued expenses | $ | n/a | $ | $ | $ | |||||||||||||||||||||||||||||
Futures | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Equity and index contracts | |||||||||||||||||||||||||||||||||||
Options | Other liabilities & accrued expenses | n/a | ( | ( | |||||||||||||||||||||||||||||||
Futures | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Total return index contracts | |||||||||||||||||||||||||||||||||||
Total return swap agreements - fixed income | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Total return swap agreements - equity | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Foreign currency contracts | |||||||||||||||||||||||||||||||||||
Foreign currency forwards | Other liabilities & accrued expenses | n/a | ( | ||||||||||||||||||||||||||||||||
Embedded derivative financial instruments | |||||||||||||||||||||||||||||||||||
Guaranteed accumulation benefits | Contractholder funds | n/a | ( | ( | |||||||||||||||||||||||||||||||
Guaranteed withdrawal benefits | Contractholder funds | n/a | ( | ( | |||||||||||||||||||||||||||||||
Equity-indexed and forward starting options in life and annuity product contracts | Contractholder funds | n/a | ( | ( | |||||||||||||||||||||||||||||||
Credit default contracts | |||||||||||||||||||||||||||||||||||
Credit default swaps - buying protection | Other liabilities & accrued expenses | n/a | ( | ( | |||||||||||||||||||||||||||||||
Credit default swaps - selling protection | Other liabilities & accrued expenses | n/a | |||||||||||||||||||||||||||||||||
Total liability derivatives | ( | $ | $ | ( | |||||||||||||||||||||||||||||||
Total derivatives | $ | $ | ( |
($ in millions) | Offsets | ||||||||||||||||||||||||||||||||||
Gross amount | Counter- party netting | Cash collateral (received) pledged | Net amount on balance sheet | Securities collateral (received) pledged | Net amount | ||||||||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Asset derivatives | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||
Liability derivatives | ( | ||||||||||||||||||||||||||||||||||
December 31, 2019 | |||||||||||||||||||||||||||||||||||
Asset derivatives | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Liability derivatives | ( | ( | ( | ( |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Gain recognized in OCI on derivatives during the period | $ | $ | $ | ||||||||||||||
Gain recognized in OCI on derivatives during the term of the hedging relationship | |||||||||||||||||
Gain reclassified from AOCI into income (net investment income) | |||||||||||||||||
Gain reclassified from AOCI into income (realized capital gains and losses) |
($ in millions) | Realized capital gains and losses | Contract benefits | Interest credited to contractholder funds | Total gain (loss) recognized in net income on derivatives | |||||||||||||||||||
2020 | |||||||||||||||||||||||
Interest rate contracts | $ | $ | $ | $ | |||||||||||||||||||
Equity and index contracts | |||||||||||||||||||||||
Embedded derivative financial instruments | ( | ( | ( | ||||||||||||||||||||
Foreign currency contracts | ( | ( | |||||||||||||||||||||
Credit default contracts | |||||||||||||||||||||||
Total return swaps - equity index | |||||||||||||||||||||||
Total | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
2019 | |||||||||||||||||||||||
Equity and index contracts | $ | $ | $ | $ | |||||||||||||||||||
Embedded derivative financial instruments | ( | ( | |||||||||||||||||||||
Foreign currency contracts | |||||||||||||||||||||||
Credit default contracts | ( | ( | |||||||||||||||||||||
Total return swaps - fixed income | |||||||||||||||||||||||
Total return swaps - equity index | |||||||||||||||||||||||
Total | $ | $ | $ | $ | |||||||||||||||||||
2018 | |||||||||||||||||||||||
Interest rate contracts | $ | $ | $ | $ | |||||||||||||||||||
Equity and index contracts | ( | ( | ( | ||||||||||||||||||||
Embedded derivative financial instruments | ( | ||||||||||||||||||||||
Foreign currency contracts | |||||||||||||||||||||||
Total return swaps - fixed income | ( | ( | |||||||||||||||||||||
Total return swaps - equity index | ( | ( | |||||||||||||||||||||
Total | $ | $ | ( | $ | $ |
($ in millions) | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||
Rating (1) | Number of counter-parties | Notional amount (2) | Credit exposure (2) | Exposure, net of collateral (2) | Number of counter-parties | Notional amount (2) | Credit exposure (2) | Exposure, net of collateral (2) | ||||||||||||||||||||||||||||||||||||||||||
A+ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
($ in millions) | 2020 | 2019 | |||||||||
Gross liability fair value of contracts containing credit-risk-contingent features | $ | $ | |||||||||
Gross asset fair value of contracts containing credit-risk-contingent features and subject to MNAs | ( | ( | |||||||||
Collateral posted under MNAs for contracts containing credit-risk-contingent features | ( | ( | |||||||||
Maximum amount of additional exposure for contracts with credit-risk-contingent features if all features were triggered concurrently | $ | $ |
($ in millions) | Notional amount | ||||||||||||||||||||||||||||||||||
AA | A | BBB | BB and lower | Total | Fair value | ||||||||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Single name | |||||||||||||||||||||||||||||||||||
Corporate debt | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
December 31, 2019 | |||||||||||||||||||||||||||||||||||
Single name | |||||||||||||||||||||||||||||||||||
Corporate debt | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
($ in millions) | 2020 | 2019 | |||||||||
Commitments to invest in limited partnership interests | $ | $ | |||||||||
Private placement commitments | |||||||||||
Other loan commitments |
($ in millions) | 2020 | 2019 | |||||||||
Immediate fixed annuities: | |||||||||||
Structured settlement annuities | $ | $ | |||||||||
Other immediate fixed annuities | |||||||||||
Traditional life insurance | |||||||||||
Accident and health insurance | |||||||||||
Other | |||||||||||
Total reserve for life-contingent contract benefits | $ | $ |
Product | Mortality | Interest rate | Estimation method | |||||||||||||||||
Structured settlement annuities | Actual company experience with projected calendar year improvements | Present value of contractually specified future benefits and expenses | ||||||||||||||||||
Other immediate fixed annuities | Actual company experience with projected calendar year improvements | Present value of expected future benefits and expenses | ||||||||||||||||||
Traditional life insurance | Actual company experience plus loading | Interest rate assumptions range from | Net level premium reserve method using the Company’s withdrawal experience rates; includes reserves for unpaid claims | |||||||||||||||||
Accident and health insurance | Actual company experience plus loading | Interest rate assumptions range from | Unearned premium; additional contract reserves for mortality risk and unpaid claims | |||||||||||||||||
Other: Variable annuity guaranteed minimum death benefits (1) | Annuity 2012 mortality table with internal modifications | Interest rate assumptions range from | Projected benefit ratio applied to cumulative assessments |
($ in millions) | 2020 | 2019 | |||||||||
Interest-sensitive life insurance | $ | $ | |||||||||
Investment contracts: | |||||||||||
Fixed annuities | |||||||||||
Other investment contracts | |||||||||||
Total contractholder funds | $ | $ |
Product | Interest rate | Withdrawal/surrender charges | ||||||||||||
Interest-sensitive life insurance | Interest rates credited range from | Either a percentage of account balance or dollar amount grading off generally over | ||||||||||||
Fixed annuities | Interest rates credited range from | Either a declining or a level percentage charge generally over ten years or less. Additionally, approximately | ||||||||||||
Other investment contracts: Guaranteed minimum income, accumulation and withdrawal benefits on variable (1) and fixed annuities and secondary guarantees on interest-sensitive life insurance and fixed annuities | Interest rates used in establishing reserves range from | Withdrawal and surrender charges are based on the terms of the related interest-sensitive life insurance or fixed annuity contract |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Balance, beginning of year | $ | $ | $ | ||||||||||||||
Deposits | |||||||||||||||||
Interest credited | |||||||||||||||||
Benefits | ( | ( | ( | ||||||||||||||
Surrenders and partial withdrawals | ( | ( | ( | ||||||||||||||
Contract charges | ( | ( | ( | ||||||||||||||
Net transfers from separate accounts | |||||||||||||||||
Reinsurance assumed from AAC | |||||||||||||||||
Other adjustments | ( | ||||||||||||||||
Balance, end of year | $ | $ | $ |
($ in millions) | As of December 31, | ||||||||||
2020 | 2019 | ||||||||||
In the event of death | |||||||||||
Separate account value | $ | $ | |||||||||
Net amount at risk (1) | $ | $ | |||||||||
Average attained age of contractholders | |||||||||||
At annuitization (includes income benefit guarantees) | |||||||||||
Separate account value | $ | $ | |||||||||
Net amount at risk (2) | $ | $ | |||||||||
Weighted average waiting period until annuitization options available | None | None | |||||||||
For cumulative periodic withdrawals | |||||||||||
Separate account value | $ | $ | |||||||||
Net amount at risk (3) | $ | $ | |||||||||
Accumulation at specified dates | |||||||||||
Separate account value | $ | $ | |||||||||
Net amount at risk (4) | $ | $ | |||||||||
Weighted average waiting period until guarantee date |
($ in millions) | Liability for guarantees related to death benefits and interest-sensitive life products | Liability for guarantees related to income benefits | Liability for guarantees related to accumulation and withdrawal benefits | Total | |||||||||||||||||||
Balance, December 31, 2019 | $ | $ | $ | $ | |||||||||||||||||||
Less reinsurance recoverables | |||||||||||||||||||||||
Net balance as of December 31, 2019 | |||||||||||||||||||||||
Incurred guarantee benefits | |||||||||||||||||||||||
Paid guarantee benefits | ( | ( | |||||||||||||||||||||
Reinsurance assumed from AAC | |||||||||||||||||||||||
Net change | |||||||||||||||||||||||
Net balance as of December 31, 2020 | |||||||||||||||||||||||
Plus reinsurance recoverables | |||||||||||||||||||||||
Balance, December 31, 2020 | $ | $ | $ | $ | |||||||||||||||||||
Balance, December 31, 2018 | $ | $ | $ | $ | |||||||||||||||||||
Less reinsurance recoverables | |||||||||||||||||||||||
Net balance as of December 31, 2018 | |||||||||||||||||||||||
Incurred guarantee benefits | |||||||||||||||||||||||
Paid guarantee benefits | ( | ( | |||||||||||||||||||||
Net change | |||||||||||||||||||||||
Net balance as of December 31, 2019 | |||||||||||||||||||||||
Plus reinsurance recoverables | |||||||||||||||||||||||
Balance, December 31, 2019 | $ | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Variable annuity | |||||||||||||||||
Death benefits | $ | $ | $ | ||||||||||||||
Income benefits | |||||||||||||||||
Accumulation benefits | |||||||||||||||||
Withdrawal benefits | |||||||||||||||||
Other guarantees | |||||||||||||||||
Total | $ | $ | $ |
Period | Retention limits | |||||||
April 2015 through current | Single life: $ Joint life: no longer offered | |||||||
April 2011 through March 2015 | Single life: $ Joint life: $ | |||||||
July 2007 through March 2011 | $ | |||||||
September 1998 through June 2007 | $ | |||||||
August 1998 and prior | Up to $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Premiums and contract charges | $ | $ | $ | ||||||||||||||
Contract benefits | ( | ||||||||||||||||
Interest credited to contractholder funds | |||||||||||||||||
Operating costs and expenses |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Direct | $ | $ | $ | ||||||||||||||
Assumed | |||||||||||||||||
Affiliate | |||||||||||||||||
Non-affiliate | |||||||||||||||||
Ceded | |||||||||||||||||
Affiliate | ( | ( | ( | ||||||||||||||
Non-affiliate | ( | ( | ( | ||||||||||||||
Premiums and contract charges, net of reinsurance | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Direct | $ | $ | $ | ||||||||||||||
Assumed | |||||||||||||||||
Affiliate | |||||||||||||||||
Non-affiliate | |||||||||||||||||
Ceded | |||||||||||||||||
Affiliate | ( | ( | ( | ||||||||||||||
Non-affiliate | ( | ( | ( | ||||||||||||||
Contract benefits, net of reinsurance | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Direct | $ | $ | $ | ||||||||||||||
Assumed | |||||||||||||||||
Affiliate | |||||||||||||||||
Non-affiliate | |||||||||||||||||
Ceded | |||||||||||||||||
Affiliate | ( | ( | ( | ||||||||||||||
Non-affiliate | ( | ( | ( | ||||||||||||||
Interest credited to contractholder funds, net of reinsurance | $ | $ | $ |
($ in millions) | 2020 | 2019 | |||||||||
Annuities | $ | $ | |||||||||
Life insurance | |||||||||||
Other | |||||||||||
Total | $ | $ |
($ in millions) | 2020 | ||||
Beginning balance | $ | ( | |||
Cumulative effect of change in accounting principle | ( | ||||
Increase in the provision for credit losses | ( | ||||
Write-offs | |||||
Ending Balance | $ | ( |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Balance, beginning of year | $ | $ | $ | ||||||||||||||
Acquisition costs deferred | |||||||||||||||||
Amortization charged to income | ( | ( | ( | ||||||||||||||
Effect of unrealized gains and losses | ( | ( | |||||||||||||||
Reinsurance assumed from AAC | |||||||||||||||||
Balance, end of year | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Balance, beginning of year | $ | $ | $ | ||||||||||||||
Amortization charged to income | ( | ( | ( | ||||||||||||||
Effect of unrealized gains and losses | ( | ||||||||||||||||
Balance, end of year | $ | $ | $ |
($ in millions) | 2020 | 2019 | |||||||||
Deferred tax assets | |||||||||||
Deferred reinsurance gain | $ | $ | |||||||||
Other assets | |||||||||||
Total deferred tax assets | |||||||||||
Deferred tax liabilities | |||||||||||
Unrealized net capital gains | ( | ( | |||||||||
Life and annuity reserves | ( | ( | |||||||||
Investments | ( | ( | |||||||||
DAC | ( | ( | |||||||||
Other liabilities | ( | ( | |||||||||
Total deferred tax liabilities | ( | ( | |||||||||
Net deferred tax liability | $ | ( | $ | ( |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Current | $ | $ | $ | ||||||||||||||
Deferred | ( | ( | |||||||||||||||
Total income tax expense | $ | $ | $ |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Statutory federal income tax rate - expense | % | % | % | ||||||||||||||
Tax credits | ( | ( | ( | ||||||||||||||
Adjustments to prior year tax liabilities | ( | ( | |||||||||||||||
Dividends received deduction | ( | ( | ( | ||||||||||||||
State income taxes | |||||||||||||||||
Non-deductible expenses | |||||||||||||||||
Tax Legislation benefit | ( | ||||||||||||||||
Other | ( | ||||||||||||||||
Effective income tax rate - expense | % | % | % |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Pre- tax | Tax | After- tax | Pre- tax | Tax | After- tax | Pre- tax | Tax | After- tax | |||||||||||||||||||||||||||||||||||||||||||||
Unrealized net holding gains and losses arising during the period, net of related offsets | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||
Less: reclassification adjustment of realized capital gains and losses | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized net capital gains and losses | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized foreign currency translation adjustments | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | $ | $ | ( |
($ in millions) | Cost/ amortized cost, net | Fair value (if applicable) | Amount shown in the Balance Sheet | ||||||||||||||
Type of investment | |||||||||||||||||
Fixed maturities: | |||||||||||||||||
Bonds: | |||||||||||||||||
United States government, government agencies and authorities | $ | $ | $ | ||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||
Foreign governments | |||||||||||||||||
Public utilities | |||||||||||||||||
All other corporate bonds | |||||||||||||||||
Asset-backed securities | |||||||||||||||||
Mortgage-backed securities | |||||||||||||||||
Total fixed maturities | $ | ||||||||||||||||
Equity securities: | |||||||||||||||||
Common stocks: | |||||||||||||||||
Public utilities | $ | ||||||||||||||||
Banks, trusts and insurance companies | |||||||||||||||||
Industrial, miscellaneous and all other | |||||||||||||||||
Nonredeemable preferred stocks | |||||||||||||||||
Total equity securities | $ | ||||||||||||||||
Mortgage loans on real estate | $ | ||||||||||||||||
Real estate ( | |||||||||||||||||
Policy loans | |||||||||||||||||
Derivative instruments | $ | ||||||||||||||||
Limited partnership interests | |||||||||||||||||
Other long-term investments | |||||||||||||||||
Short-term investments | $ | ||||||||||||||||
Total investments | $ | $ |
($ in millions) | Gross amount | Ceded to other companies (1) | Assumed from other companies | Net amount | Percentage of amount assumed to net | ||||||||||||||||||||||||
Year ended December 31, 2020 | |||||||||||||||||||||||||||||
Life insurance in force | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Premiums and contract charges: | |||||||||||||||||||||||||||||
Life insurance | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Accident and health insurance | % | ||||||||||||||||||||||||||||
Total premiums and contract charges | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Year ended December 31, 2019 | |||||||||||||||||||||||||||||
Life insurance in force | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Premiums and contract charges: | |||||||||||||||||||||||||||||
Life insurance | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Accident and health insurance | % | ||||||||||||||||||||||||||||
Total premiums and contract charges | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Year ended December 31, 2018 | |||||||||||||||||||||||||||||
Life insurance in force | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Premiums and contract charges: | |||||||||||||||||||||||||||||
Life insurance | $ | $ | $ | $ | % | ||||||||||||||||||||||||
Accident and health insurance | % | ||||||||||||||||||||||||||||
Total premiums and contract charges | $ | $ | $ | $ | % |
($ in millions) | Additions | ||||||||||||||||||||||||||||||||||
Description | Balance as of beginning of period | Cumulative effect of change in accounting principle (1) | Charged to costs and expenses | Other additions | Deductions | Balance as of end of period | |||||||||||||||||||||||||||||
Year ended December 31, 2020 | |||||||||||||||||||||||||||||||||||
Allowance for credit losses on fixed income securities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Allowance for credit losses on mortgage loans | |||||||||||||||||||||||||||||||||||
Allowance for credit losses on bank loans | |||||||||||||||||||||||||||||||||||
Allowance for credit losses on agent loans | |||||||||||||||||||||||||||||||||||
Allowance for credit losses on reinsurance recoverables | |||||||||||||||||||||||||||||||||||
Allowances for credit losses on other assets | |||||||||||||||||||||||||||||||||||
Allowance for credit losses on commitments to fund mortgage loans, bank loans and agent loans | |||||||||||||||||||||||||||||||||||
Year ended December 31, 2019 | |||||||||||||||||||||||||||||||||||
Allowance for reinsurance recoverables | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
Allowance for estimated losses on mortgage loans | |||||||||||||||||||||||||||||||||||
Allowance for estimated losses on agent loans | |||||||||||||||||||||||||||||||||||
Year ended December 31, 2018 | |||||||||||||||||||||||||||||||||||
Allowance for estimated losses on mortgage loans | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
Allowance for estimated losses on agent loans |
Page | |||||
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Revenues | |||||||||||||||||
Premiums | $ | 618 | $ | 677 | $ | 704 | |||||||||||
Contract charges | 675 | 682 | 695 | ||||||||||||||
Other revenue | 34 | 42 | 38 | ||||||||||||||
Net investment income | 1,242 | 1,411 | 1,585 | ||||||||||||||
Realized capital gains and losses | 266 | 341 | (175) | ||||||||||||||
Total revenues | 2,835 | 3,153 | 2,847 | ||||||||||||||
Costs and expenses | |||||||||||||||||
Contract benefits | (1,729) | (1,481) | (1,446) | ||||||||||||||
Interest credited to contractholder funds | (579) | (585) | (601) | ||||||||||||||
Amortization of DAC | (147) | (180) | (146) | ||||||||||||||
Operating costs and expenses | (229) | (249) | (271) | ||||||||||||||
Restructuring and related charges | (5) | (1) | (2) | ||||||||||||||
Interest expense | (7) | (5) | (5) | ||||||||||||||
Total costs and expenses | (2,696) | (2,501) | (2,471) | ||||||||||||||
Gain on disposition of operations | 4 | 6 | 6 | ||||||||||||||
Income tax expense | (7) | (128) | (17) | ||||||||||||||
Net income | $ | 136 | $ | 530 | $ | 365 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Underwritten products | |||||||||||||||||
Traditional life insurance premiums | $ | 531 | $ | 557 | $ | 582 | |||||||||||
Accident and health insurance premiums | 87 | 120 | 122 | ||||||||||||||
Interest-sensitive life insurance contract charges | 665 | 669 | 680 | ||||||||||||||
Subtotal | 1,283 | 1,346 | 1,384 | ||||||||||||||
Annuities | |||||||||||||||||
Fixed annuity contract charges | 10 | 13 | 15 | ||||||||||||||
Premiums and contract charges (1) | $ | 1,293 | $ | 1,359 | $ | 1,399 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Life insurance | $ | 104 | $ | 218 | $ | 254 | |||||||||||
Accident and health insurance | 47 | 53 | 59 | ||||||||||||||
Annuities | (260) | (95) | (68) | ||||||||||||||
Total benefit spread | $ | (109) | $ | 176 | $ | 245 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Investment spread before valuation changes on embedded derivatives that are not hedged | $ | 207 | $ | 365 | $ | 489 | |||||||||||
Valuation changes on derivatives embedded in equity-indexed life and annuity contracts that are not hedged | (38) | (18) | 3 | ||||||||||||||
Total investment spread | $ | 169 | $ | 347 | $ | 492 |
Weighted average investment yield | Weighted average interest crediting rate | Weighted average investment spreads | |||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | 2020 | 2019 | 2018 | 2020 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||||||||||||
Interest-sensitive life insurance | 4.7 | % | 4.9 | % | 5.1 | % | 3.6 | % | 3.7 | % | 3.7 | % | 1.1 | % | 1.2 | % | 1.4 | % | |||||||||||||||||||||||||||||||||||
Deferred fixed annuities | 4.0 | 4.3 | 4.1 | 2.7 | 2.7 | 2.8 | 1.3 | 1.6 | 1.3 | ||||||||||||||||||||||||||||||||||||||||||||
Immediate fixed annuities with and without life contingencies | 4.1 | 5.0 | 6.4 | 6.1 | 5.9 | 6.0 | (2.0) | (0.9) | 0.4 | ||||||||||||||||||||||||||||||||||||||||||||
Investments supporting capital, traditional life and other products | 3.5 | 3.7 | 3.6 | n/a | n/a | n/a | n/a | n/a | n/a |
($ in millions) | Weighted average guaranteed crediting rates | Weighted average current crediting rates | Contractholder funds | ||||||||||||||
Annuities with annual crediting rate resets | 3.17 | % | 3.17 | % | $ | 3,922 | |||||||||||
Annuities with multi-year rate guarantees (1): | |||||||||||||||||
Resettable in next 12 months | 2.18 | 2.67 | 103 | ||||||||||||||
Resettable after 12 months | 2.29 | 2.63 | 425 | ||||||||||||||
Interest-sensitive life insurance | 3.83 | 3.85 | 7,039 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Amortization of DAC before amortization relating to realized capital gains and losses, valuation changes on embedded derivatives that are not hedged and changes in assumptions | $ | 83 | $ | 130 | $ | 134 | |||||||||||
Amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged (1) | (8) | 6 | 10 | ||||||||||||||
Amortization acceleration for changes in assumptions (“DAC unlocking”) | 72 | 44 | 2 | ||||||||||||||
Total amortization of DAC | $ | 147 | $ | 180 | $ | 146 |
($ in millions) | Traditional life and accident and health | Interest-sensitive life insurance | Fixed annuities | Total | |||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 468 | $ | 507 | $ | 459 | $ | 698 | $ | 20 | $ | 27 | $ | 947 | $ | 1,232 | |||||||||||||||||||||||||||||||
Acquisition costs deferred | 19 | 25 | 32 | 30 | — | — | 51 | 55 | |||||||||||||||||||||||||||||||||||||||
Amortization of DAC before amortization relating to realized capital gains and losses, valuation changes on embedded derivatives that are not hedged and changes in assumptions (1) | (51) | (64) | (28) | (59) | (4) | (7) | (83) | (130) | |||||||||||||||||||||||||||||||||||||||
Amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged (1) | — | — | 8 | (6) | — | — | 8 | (6) | |||||||||||||||||||||||||||||||||||||||
Amortization acceleration for DAC unlocking (1) | — | — | (72) | (44) | — | — | (72) | (44) | |||||||||||||||||||||||||||||||||||||||
Effect of unrealized capital gains and losses (2) | — | — | (123) | (160) | — | — | (123) | (160) | |||||||||||||||||||||||||||||||||||||||
Reinsurance assumed from AAC | 121 | — | 124 | — | — | — | 245 | — | |||||||||||||||||||||||||||||||||||||||
Ending balance | $ | 557 | $ | 468 | $ | 400 | $ | 459 | $ | 16 | $ | 20 | $ | 973 | $ | 947 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Traditional life insurance | $ | 2,650 | $ | 2,552 | $ | 2,517 | |||||||||||
Accident and health insurance | 169 | 195 | 203 | ||||||||||||||
Immediate fixed annuities with life contingencies | |||||||||||||||||
Sub-standard structured settlements and group pension terminations (1) | 5,780 | 5,085 | 4,990 | ||||||||||||||
Standard structured settlements and SPIA (2) | 3,134 | 3,362 | 3,420 | ||||||||||||||
Other | 67 | 78 | 109 | ||||||||||||||
Reserve for life-contingent contract benefits | $ | 11,800 | $ | 11,272 | $ | 11,239 | |||||||||||
Interest-sensitive life insurance | $ | 7,794 | $ | 7,442 | $ | 7,369 | |||||||||||
Deferred fixed annuities | 6,003 | 6,468 | 7,123 | ||||||||||||||
Immediate fixed annuities without life contingencies | 2,160 | 2,343 | 2,522 | ||||||||||||||
Other | 524 | 458 | 456 | ||||||||||||||
Contractholder funds | $ | 16,481 | $ | 16,711 | $ | 17,470 | |||||||||||
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Contractholder funds, beginning balance | $ | 16,711 | $ | 17,470 | $ | 18,592 | |||||||||||
Deposits | |||||||||||||||||
Interest-sensitive life insurance | 799 | 819 | 848 | ||||||||||||||
Fixed annuities | 19 | 15 | 15 | ||||||||||||||
Total deposits | 818 | 834 | 863 | ||||||||||||||
Interest credited | 574 | 581 | 597 | ||||||||||||||
Benefits, withdrawals and other adjustments | |||||||||||||||||
Benefits | (733) | (769) | (810) | ||||||||||||||
Surrenders and partial withdrawals | (649) | (844) | (1,095) | ||||||||||||||
Contract charges | (643) | (637) | (645) | ||||||||||||||
Net transfers from separate accounts | 5 | 11 | 7 | ||||||||||||||
Reinsurance assumed from AAC | 256 | — | — | ||||||||||||||
Other adjustments (1) | 142 | 65 | (39) | ||||||||||||||
Total benefits, withdrawals and other adjustments | (1,622) | (2,174) | (2,582) | ||||||||||||||
Contractholder funds, ending balance | $ | 16,481 | $ | 16,711 | $ | 17,470 |
($ in millions) | S&P financial strength rating (1) | Reinsurance recoverable on paid and unpaid benefits | ||||||||||||||||||
2020 | 2019 | |||||||||||||||||||
Prudential Insurance Company of America | AA- | $ | 1,284 | $ | 1,288 | |||||||||||||||
RGA Reinsurance Company | AA- | 166 | 197 | |||||||||||||||||
Swiss Re Life and Health America, Inc. | AA- | 146 | 155 | |||||||||||||||||
Transamerica Life Group | A+ | 78 | 78 | |||||||||||||||||
Munich American Reassurance | AA- | 70 | 80 | |||||||||||||||||
Scottish Re (U.S.), Inc. (2) | N/A | 66 | 73 | |||||||||||||||||
John Hancock Life & Health Insurance Company | AA- | 45 | 50 | |||||||||||||||||
Triton Insurance Company (3) | N/A | 40 | 43 | |||||||||||||||||
American Health & Life Insurance Company (3) | N/A | 29 | 32 | |||||||||||||||||
Security Life of Denver | A+ | 22 | 23 | |||||||||||||||||
Lincoln National Life Insurance | AA- | 21 | 27 | |||||||||||||||||
SCOR Global Life | AA- | 12 | 14 | |||||||||||||||||
American United Life Insurance Company | AA- | 9 | 11 | |||||||||||||||||
Allstate Assurance Company (4) | N/A | — | 408 | |||||||||||||||||
Other (5) | 15 | 14 | ||||||||||||||||||
Credit loss allowance (6) | (14) | (3) | ||||||||||||||||||
Total | $ | 1,989 | $ | 2,490 |
($ in millions) | Fixed income securities | Mortgage loans | ||||||||||||||||||||||||
Carrying value | Investment yield | Carrying value | Investment yield | |||||||||||||||||||||||
2021 | $ | 1,651 | 4.7 | % | $ | 254 | 4.6 | % | ||||||||||||||||||
2022 | 2,008 | 3.7 | 291 | 4.3 | ||||||||||||||||||||||
2023 | 1,853 | 3.4 | 485 | 4.3 |
($ in millions) | December 31, 2020 | Percent to total | |||||||||
Fixed income securities (1) | $ | 23,907 | 68.7 | % | |||||||
Mortgage loans, net | 3,359 | 9.7 | |||||||||
Equity securities (2) | 1,536 | 4.4 | |||||||||
Limited partnership interests | 3,065 | 8.8 | |||||||||
Short-term investments (3) | 974 | 2.8 | |||||||||
Policy loans | 582 | 1.7 | |||||||||
Other, net | 1,375 | 3.9 | |||||||||
Total | $ | 34,798 | 100.0 | % | |||||||
($ in millions) | Market- based | Performance-based | Total | ||||||||||||||
Fixed income securities | $ | 23,886 | $ | 21 | $ | 23,907 | |||||||||||
Mortgage loans, net | 3,359 | — | 3,359 | ||||||||||||||
Equity securities | 1,452 | 84 | 1,536 | ||||||||||||||
Limited partnership interests | 200 | 2,865 | 3,065 | ||||||||||||||
Short-term investments | 974 | — | 974 | ||||||||||||||
Policy loans | 582 | — | 582 | ||||||||||||||
Other, net | 1,054 | 321 | 1,375 | ||||||||||||||
Total | $ | 31,507 | $ | 3,291 | $ | 34,798 | |||||||||||
Percent to total | 90.5 | % | 9.5 | % | 100.0 | % | |||||||||||
Unrealized net capital gains (losses) | |||||||||||||||||
Fixed income securities | $ | 2,385 | $ | — | $ | 2,385 | |||||||||||
Limited partnership interests | — | (2) | (2) | ||||||||||||||
Total | $ | 2,385 | $ | (2) | $ | 2,383 |
Fair value as of | |||||||||||
($ in millions) | December 31, 2020 | December 31, 2019 | |||||||||
U.S. government and agencies | $ | 1,105 | $ | 882 | |||||||
Municipal | 2,007 | 1,755 | |||||||||
Corporate | 20,256 | 18,441 | |||||||||
Foreign government | 96 | 149 | |||||||||
Asset-backed securities (“ABS”) | 424 | 317 | |||||||||
Mortgage-backed securities (“MBS”) | 19 | 181 | |||||||||
Total fixed income securities | $ | 23,907 | $ | 21,725 |
($ in millions) | Investment grade | Below investment grade | Total | ||||||||||||||||||||||||||||||||||||||
Fair value | Unrealized gain (loss) | Fair value | Unrealized gain (loss) | Fair value | Unrealized gain (loss) | Percent rated investment grade | |||||||||||||||||||||||||||||||||||
U.S. government and agencies | $ | 1,105 | $ | 45 | $ | — | $ | — | $ | 1,105 | $ | 45 | 100.0 | % | |||||||||||||||||||||||||||
Municipal | 1,977 | 352 | 30 | 5 | 2,007 | 357 | 98.5 | % | |||||||||||||||||||||||||||||||||
Corporate | |||||||||||||||||||||||||||||||||||||||||
Public | 13,249 | 1,459 | 1,317 | 85 | 14,566 | 1,544 | 91.0 | % | |||||||||||||||||||||||||||||||||
Privately placed | 4,070 | 366 | 1,620 | 59 | 5,690 | 425 | 71.5 | % | |||||||||||||||||||||||||||||||||
Total corporate | 17,319 | 1,825 | 2,937 | 144 | 20,256 | 1,969 | 85.5 | % | |||||||||||||||||||||||||||||||||
Foreign government | 91 | 5 | 5 | — | 96 | 5 | 94.8 | % | |||||||||||||||||||||||||||||||||
ABS | 413 | 2 | 11 | 2 | 424 | 4 | 97.4 | % | |||||||||||||||||||||||||||||||||
MBS | 12 | 1 | 7 | 4 | 19 | 5 | 63.2 | % | |||||||||||||||||||||||||||||||||
Total fixed income securities | $ | 20,917 | $ | 2,230 | $ | 2,990 | $ | 155 | $ | 23,907 | $ | 2,385 | 87.5 | % |
($ in millions) | 2020 | 2019 | |||||||||
U.S. government and agencies | $ | 45 | $ | 34 | |||||||
Municipal | 357 | 272 | |||||||||
Corporate | 1,969 | 1,140 | |||||||||
Foreign government | 5 | 7 | |||||||||
ABS | 4 | 1 | |||||||||
MBS | 5 | 54 | |||||||||
Fixed income securities | 2,385 | 1,508 | |||||||||
Equity method of accounting (“EMA”) limited partnerships | (2) | (2) | |||||||||
Unrealized net capital gains and losses, pre-tax | $ | 2,383 | $ | 1,506 |
($ in millions) | Amortized | Gross unrealized | Fair | ||||||||||||||||||||
cost | Gains | Losses | value | ||||||||||||||||||||
Corporate | $ | 18,287 | $ | 2,009 | $ | (40) | $ | 20,256 | |||||||||||||||
U.S. government and agencies | 1,060 | 45 | — | 1,105 | |||||||||||||||||||
Municipal | 1,650 | 357 | — | 2,007 | |||||||||||||||||||
Foreign government | 91 | 5 | — | 96 | |||||||||||||||||||
ABS | 420 | 6 | (2) | 424 | |||||||||||||||||||
MBS | 14 | 5 | — | 19 | |||||||||||||||||||
Total fixed income securities | $ | 21,522 | $ | 2,427 | $ | (42) | $ | 23,907 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Fixed income securities | $ | 894 | $ | 963 | $ | 991 | |||||||||||
Mortgage loans | 184 | 190 | 188 | ||||||||||||||
Equity securities | 19 | 29 | 39 | ||||||||||||||
Limited partnership interests | 99 | 175 | 327 | ||||||||||||||
Short-term investments | 6 | 31 | 21 | ||||||||||||||
Policy loans | 31 | 34 | 31 | ||||||||||||||
Other | 90 | 93 | 91 | ||||||||||||||
Investment income, before expense | 1,323 | 1,515 | 1,688 | ||||||||||||||
Investment expense | |||||||||||||||||
Investee level expenses (1) | (21) | (27) | (23) | ||||||||||||||
Securities lending expense | (2) | (13) | (10) | ||||||||||||||
Operating costs and expenses | (58) | (64) | (70) | ||||||||||||||
Total investment expense | (81) | (104) | (103) | ||||||||||||||
Net investment income | $ | 1,242 | $ | 1,411 | $ | 1,585 | |||||||||||
Market-based | $ | 1,204 | $ | 1,318 | $ | 1,339 | |||||||||||
Performance-based | 119 | 197 | 349 | ||||||||||||||
Investment income, before expense | $ | 1,323 | $ | 1,515 | $ | 1,688 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Limited partnerships | |||||||||||||||||
Private equity | $ | 84 | $ | 124 | $ | 276 | |||||||||||
Real estate | 15 | 51 | 51 | ||||||||||||||
Performance-based - limited partnerships | 99 | 175 | 327 | ||||||||||||||
Non-limited partnerships | |||||||||||||||||
Private equity | (9) | (1) | 1 | ||||||||||||||
Real estate | 29 | 23 | 21 | ||||||||||||||
Performance-based - non-limited partnerships | 20 | 22 | 22 | ||||||||||||||
Total | |||||||||||||||||
Private equity | 75 | 123 | 277 | ||||||||||||||
Real estate | 44 | 74 | 72 | ||||||||||||||
Total performance-based | $ | 119 | $ | 197 | $ | 349 | |||||||||||
Investee level expenses (1) | $ | (21) | $ | (27) | $ | (23) |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Sales (1) | $ | 42 | $ | 54 | $ | (27) | |||||||||||
Credit losses (2) | |||||||||||||||||
Fixed income securities | (3) | (5) | (8) | ||||||||||||||
Mortgage loans | (36) | — | — | ||||||||||||||
Limited partnership interests | (4) | (2) | — | ||||||||||||||
Other investments | (4) | (14) | (1) | ||||||||||||||
Total credit losses | (47) | (21) | (9) | ||||||||||||||
Valuation of equity investments - appreciation (decline): | |||||||||||||||||
Equity securities | 225 | 276 | (124) | ||||||||||||||
Limited partnerships (3) | 41 | 21 | (22) | ||||||||||||||
Total valuation of equity investments | 266 | 297 | (146) | ||||||||||||||
Valuation and settlements of derivative instruments | 5 | 11 | 7 | ||||||||||||||
Realized capital gains (losses), pre-tax | 266 | 341 | (175) | ||||||||||||||
Income tax (expense) benefit | (57) | (72) | 37 | ||||||||||||||
Realized capital gains (losses), after-tax | $ | 209 | $ | 269 | $ | (138) | |||||||||||
Market-based | $ | 250 | $ | 300 | $ | (202) | |||||||||||
Performance-based | 16 | 41 | 27 | ||||||||||||||
Realized capital gains (losses), pre-tax | $ | 266 | $ | 341 | (175) |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Sales (1) | $ | (8) | $ | 24 | $ | (1) | |||||||||||
Credit losses (2) | (4) | (2) | — | ||||||||||||||
Valuation of equity investments | 35 | 16 | 16 | ||||||||||||||
Valuation and settlements of derivative instruments | (7) | 3 | 12 | ||||||||||||||
Total performance-based | $ | 16 | $ | 41 | $ | 27 |
($ in millions) | 2020 | 2019 | 2018 | ||||||||||||||
Common stock, retained income and additional capital paid-in | $ | 7,040 | $ | 6,894 | $ | 6,439 | |||||||||||
Accumulated other comprehensive income | 1,207 | 915 | 253 | ||||||||||||||
Total shareholder’s equity | 8,247 | 7,809 | 6,692 | ||||||||||||||
Notes due to related parties | 214 | 214 | 140 | ||||||||||||||
Total capital resources | $ | 8,461 | $ | 8,023 | $ | 6,832 |
Rating agency | Rating | ||||
A.M. Best Company, Inc. | A+ | ||||
Moody’s Investors Service, Inc. | A2 |
Potential sources of funds | Potential uses of funds | ||||
Receipt of insurance premiums | Payment of contract benefits, surrenders and withdrawals | ||||
Contractholder fund deposits | Reinsurance cessions and payments | ||||
Reinsurance recoveries | Operating costs and expenses | ||||
Receipts of principal, interest and dividends on investments | Purchase of investments | ||||
Sales of investments | Repayment of securities lending and line of credit agreements | ||||
Funds from securities lending and line of credit agreements | Payment or repayment of intercompany loans | ||||
Intercompany loans | Dividends and return of capital to parent | ||||
Capital contributions from parent | Tax payments/settlements | ||||
Tax refunds/settlements | Debt service expenses and repayment | ||||
Funds from issuance of surplus notes or other notes | Payments for acquisitions |
($ in millions) | December 31, 2020 | Percent to total | |||||||||
Not subject to discretionary withdrawal | $ | 2,618 | 15.9 | % | |||||||
Subject to discretionary withdrawal with adjustments: | |||||||||||
Specified surrender charges (1) | 4,702 | 28.5 | |||||||||
Market value adjustments (2) | 697 | 4.2 | |||||||||
Subject to discretionary withdrawal without adjustments (3) | 8,464 | 51.4 | |||||||||
Total contractholder funds (4) | $ | 16,481 | 100.0 | % |
($ in millions) | Fair value | Percent to total | |||||||||
Fair value based on internal sources | $ | 1,896 | 7.2 | % | |||||||
Fair value based on external sources (1) | 24,521 | 92.8 | |||||||||
Total | $ | 26,417 | 100.0 | % |
($ in millions) | 2020 | 2019 | |||||||||
Investment margin | $ | 116 | $ | 18 | |||||||
Benefit margin | (4) | 26 | |||||||||
Expense margin | (40) | — | |||||||||
Net acceleration | $ | 72 | $ | 44 |
($ in millions) | Increase/(reduction) | ||||||||||
Increase in future investment margins of 25 basis points | $ | 54 | |||||||||
Decrease in future investment margins of 25 basis points | $ | (60) | |||||||||
Decrease in future life mortality by 1% | $ | 15 | |||||||||
Increase in future life mortality by 1% | $ | (16) |
Title of Class (a) | Name and Address of Beneficial Owner (b) | Amount and Nature of Beneficial Ownership (c) | Percent of Class (d) | |||||||||||||||||
Common Stock | Allstate Insurance Company 2775 Sanders Road, Northbrook, IL 60062 | 23,800 | 100% | |||||||||||||||||
N/A | Allstate Insurance Holdings, LLC 2775 Sanders Road, Northbrook, IL 60062 | Indirect voting and investment power of shares owned by Allstate Life Insurance Company(1) | N/A | |||||||||||||||||
N/A | The Allstate Corporation 2775 Sanders Road, Northbrook, IL 60062 | Indirect voting and investment power of shares owned by Allstate Life Insurance Company(2) | N/A |
Name of Beneficial Owner | Amount and Nature of Beneficial Ownership of Allstate Common Stock (a) | Common Stock Subject to Options Exercisable and Restricted Stock Units and Performance Stock Awards for which restrictions expire on or prior to April 30, 2021 --- Included in Column (a) (b) | Percent of Class | ||||||||
John E. Dugenske | 234,796 | 170,042 | * | ||||||||
Angela K. Fontana | 11,503 | 11,503 | * | ||||||||
Mario Imbarrato | 26,619 | 25,353 | * | ||||||||
Rebecca D. Kennedy | 4,326 | 4,225 | * | ||||||||
Jesse E. Merten | 66,334 | 51,099 | * | ||||||||
Julie Parsons | 105,957 | 87,732 | * | ||||||||
John C. Pintozzi | 45,824 | 27,623 | * | ||||||||
Mark Q. Prindiville | 64,710 | 52,859 | * | ||||||||
Mario Rizzo | 180,529 | 140,927 | * | ||||||||
Glenn T. Shapiro | 143,120 | 119,195 | * | ||||||||
Thomas J. Wilson | 2,906,666 | 1,998,383 | * | ||||||||
Steven E. Shebik | 694,770 | 530,722 | * | ||||||||
James M. Flewellen | 24,867 | 20,919 | * | ||||||||
All directors and executive officers as a group (14 total) | 4,514,564 | 3,244,005 | 1.50 | % |
Transaction Description | Approximate dollar value of the amount involved in the transaction, per fiscal year | Related Person(s) involved in the transaction and the approximate dollar value of the Related Person’s interest in the transaction ($) | |||||||||||||||
($) | AIC | AIH | AllCorp | ||||||||||||||
Amended and Restated Service and Expense Agreement between Allstate Insurance Company, The Allstate Corporation and certain affiliates effective January 1, 2004, as amended by Amendment No. 1 effective January 1, 2009, addendum amount Allstate Insurance Company and certain affiliiates dated August 17, 2011.2 | 2018 2019 2020 | 5,804,734,6871 5,455,724,5001 5,410,520,3751 | 1,240,766,409 1,132,529,633 1,145,601,127 | 0 0 0 | 24,791,339 24,562,359 36,757,481 | ||||||||||||
Investment Management Agreement among Allstate Investment Management Company, The Allstate Corporation and certain affiliates effective February 1, 2012; Investment Management Agreement among Allstate Investments, LLC, Allstate Insurance Company, The Allstate Corporation and certain affiliates effective January 1, 2007.2 | 2018 2019 2020 | 159,512,9141 152,460,1431 145,564,7181 | 89,275,012 79,320,950 77,421,912 | 0 0 0 | 0 0 0 | ||||||||||||
Intercompany Loan Agreement among The Allstate Corporation, Allstate Life Insurance Company, and other certain subsidiaries of the Allstate Corporation dated February 1, 1996.2 | 2018 2019 2020 | 1,115,026,4501 247,543,1641 199,388,8711 | 0 0 0 | 0 0 0 | 1,115,026,450 (247,543,164) 199,388,871 | ||||||||||||
Tax Sharing Agreement among The Allstate Corporation and certain affiliates dated as of November 12, 1996.2 | 2018 2019 2020 | 650,000,0011,3 584,887,7341,3 1,303,358,6971,3 | 720,044,054 533,996,157 1,270,024,372 | 0 0 0 | (107,580,643) (87,501,759) (80,120,904) | ||||||||||||
Marketing Coordination and Administrative Services Agreement among Allstate Insurance Company, Allstate Life Insurance Company and Allstate Financial Services, LLC effective January 1, 2003, as amended by First Amendment to Marketing Coordination and Administrative Services Agreement by and among Allstate Life Insurance Company, Allstate Financial Services, LLC and Allstate Insurance Company effective January 1, 2006. | 2018 2019 2020 | 3,774,8531 4,403,9891 7,568,3281 | 3,774,853 4,403,989 7,568,328 | N/A | N/A |
Registration fees | $ | 0.00 | ||||||||||||
Cost of printing and engraving | $ | 353.76 | ||||||||||||
Legal fees | $ | 0.00 | ||||||||||||
Accounting fees | $ | 6,000.00 | ||||||||||||
Mailing fees | $ | 1,485.62 |
ITEM 16. EXHIBITS. | |||||
16(a) | |||||
(1)(1) | |||||
(1)(2) | |||||
(1)(3) | |||||
(2) | |||||
3(i) | |||||
3(ii) | |||||
(4)(1) | |||||
(4)(2) | |||||
(4)(3) | |||||
(4)(4) | |||||
(4)(5) | |||||
(4)(6) | |||||
(4)(7) | |||||
(4)(8) | |||||
(5) | |||||
(8) | Opinion re: tax matters. None. | ||||
(9) | Voting trust agreement. None. | ||||
(10)(1) | |||||
(10)(2) |
(10)(3) | |||||
(10)(4) | |||||
(10)(5) | |||||
(10)(6) | |||||
(10)(7) | |||||
(10)(8) | |||||
(10)(9) | |||||
(10)(10) | |||||
(10)(11) | |||||
(10)(12) | |||||
(10)(13) | |||||
(10)(14) | |||||
(10)(15) | |||||
(10)(16) | |||||
(10)(17) | |||||
(10)(18) | |||||
(10)(19) | |||||
(10)(20) | |||||
(10)(21) | |||||
(10)(22) | |||||
(10)(23) | |||||
(10)(24) | |||||
(10)(25) | |||||
(10)(26) | |||||
(10)(27) | |||||
(10)(28) | |||||
(10)(29) | |||||
(10)(30) | |||||
(10)(31) | |||||
(10)(32) | |||||
(10)(33) | |||||
(10)(34) | |||||
(10)(35) | |||||
(10)(36) | |||||
(10)(37) | |||||
(10)(38) | |||||
(10)(39) | |||||
(10)(40) | |||||
(10)(41) | |||||
(10)(42) | |||||
(10)(43) | |||||
(10)(44) | |||||
(10)(45) | |||||
(10)(46) | |||||
(15) | Letter re: unaudited interim financial information from Independent Registered Public Accounting Firm. Not Applicable. | ||||
(16) | Letter re: change in certifying accountant. Not applicable. | ||||
(21) | Subsidiaries of the Registrant. Filed herewith. | ||||
(23) | Consent of Independent Registered Public Accounting Firm. Filed herewith. | ||||
(24) | |||||
(99) | |||||
(101)(INS XBRL) | Instance Document | ||||
(101)(SCH XBRL) | Taxonomy Extension Schema | ||||
(101)(CAL XBRL) | Taxonomy Extension Calculation Linkbase | ||||
(101)(DEF XBRL) | Taxonomy Extension Definition Linkbase | ||||
(101)(LAB XBRL) | Taxonomy Extension Label Linkbase | ||||
(101)(PRE XBRL) | Taxonomy Extension Presentation Linkbase |
(16)(b) | Financial statement schedules required by Regulation S-X (17 CFR Part 210) and Item 11(e) of Form S-1 are included in Part I. | ||||
By: | /s/ Angela K. Fontana | |||||||
Angela K. Fontana Director, Vice President, General Counsel and Secretary |
*/ John E. Dugenske | Director and Chief Executive Officer | ||||
John E. Dugenske | |||||
/s/ Angela K. Fontana | Director | ||||
Angela K. Fontana | |||||
*/ Mario Imbarrato | Director and Chief Financial Officer | ||||
Mario Imbarrato | |||||
*/ Rebecca D. Kennedy | Director | ||||
Rebecca D. Kennedy | |||||
*/ Jesse E. Merten | Director | ||||
Jesse E. Merten | |||||
*/ Julie Parsons | Director | ||||
Julie Parsons | |||||
*/ John C. Pintozzi | Director and Controller | ||||
John C. Pintozzi | |||||
*/ Mark Q. Prindiville | Director | ||||
Mark Q. Prindiville | |||||
*/ Mario Rizzo | Director | ||||
Mario Rizzo | |||||
*/ Glenn T. Shapiro | Director | ||||
Glenn T. Shapiro | |||||
*/ Thomas J. Wilson | Director | ||||
Thomas J. Wilson |
Exhibit No. | Description | ||||
(10)(44) | |||||
(10)(46) | |||||
(21) | |||||
(23) | |||||
(24) |
If to the Ceding Company: | Allstate Assurance Company 3075 Sanders Rd Northbrook, Illinois 60062 Attn: Chief Financial Officer Facsimile No.: (847) 326-7065 | |||||||
If to the Reinsurer: | Allstate Life Insurance Company 3075 Sanders Rd Northbrook, Illinois 60062 Attn: Chief Financial Officer Facsimile No.: (847) 326-7065 |
Company Name | Domicile | |||||||
AIMCO Private Fund I Holding, LLC | Delaware | |||||||
AIMCO Private Fund I, LLC | Delaware | |||||||
ALIC Reinsurance Company | South Carolina | |||||||
ALINV Mosaic, LLC | Delaware | |||||||
Allstate Assignment Company | Nebraska | |||||||
Allstate Distributors, L.L.C. | Delaware | |||||||
Allstate Finance Company, LLC | Delaware | |||||||
Allstate Financial Advisors, LLC | Delaware | |||||||
Allstate International Assignments, Ltd. | Delaware | |||||||
Allstate Life Insurance Company of New York | New York | |||||||
Allstate Settlement Corporation | Nebraska | |||||||
NBInv AF1, LLC | Delaware | |||||||
NBInv AF2, LLC | Delaware | |||||||
NBInv AF3, LLC | Delaware | |||||||
NBInv AF4, LLC | Delaware | |||||||
NBInv AF5, LLC | Delaware | |||||||
NBInv AF6, LLC | Delaware | |||||||
NBInv AF7, LLC | Delaware | |||||||
NBInv AF8, LLC | Delaware | |||||||
NBInv APAF1, LLC1 | Delaware | |||||||
NBInv Riverside Cars1, LLC2 | Delaware | |||||||
NBInv Riverside Management, LLC1 | Delaware | |||||||
Road Bay Investments, LLC | Delaware | |||||||
West Plaza RE Holdings, LLC | Delaware | |||||||
Document and Entity Information |
12 Months Ended |
---|---|
Dec. 31, 2020 | |
Document and Entity Information | |
Document Type | POS AM |
Entity Registrant Name | ALLSTATE LIFE INSURANCE CO |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Central Index Key | 0000352736 |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Statement of Comprehensive Income [Abstract] | |||
Ceded premiums earned | $ 94 | $ 139 | $ 138 |
Contract charges, reinsurance ceded | 177 | 180 | 188 |
Policyholder benefits and claims incurred, ceded | (176) | (187) | (249) |
Interest credited to contractholder funds | $ (44) | $ (40) | $ (44) |
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Fixed income securities, at fair value, amortized cost | $ 21,522 | $ 20,217 |
Equity securities, at fair value, cost | 1,107 | 1,123 |
Short-term, at fair value, amortized cost | $ 974 | $ 1,191 |
Common stock, par value (in dollars per share) | $ 227 | $ 227 |
Common stock, authorized (in shares) | 23,800 | 23,800 |
Common stock, outstanding (in shares) | 23,800 | 23,800 |
Series A | ||
Redeemable preferred stock, par value (in dollars per share) | $ 100 | $ 100 |
Redeemable preferred stock, authorized (in shares) | 1,500,000 | 1,500,000 |
Redeemable preferred stock, issued (in shares) | 0 | 0 |
Series B | ||
Redeemable preferred stock, par value (in dollars per share) | $ 100 | $ 100 |
Redeemable preferred stock, authorized (in shares) | 1,500,000 | 1,500,000 |
Redeemable preferred stock, issued (in shares) | 0 | 0 |
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Cash flows from operating activities | |||
Net income | $ 136,000,000 | $ 530,000,000 | $ 365,000,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Amortization and other non-cash items | (51,000,000) | (60,000,000) | (58,000,000) |
Realized capital gains and losses | (266,000,000) | (341,000,000) | 175,000,000 |
Gain on disposition of operations | (4,000,000) | (6,000,000) | (6,000,000) |
Interest credited to contractholder funds | 579,000,000 | 585,000,000 | 601,000,000 |
Changes in: | |||
Policy benefits and other insurance reserves | (430,000,000) | (610,000,000) | (612,000,000) |
Deferred policy acquisition costs | 96,000,000 | 125,000,000 | 67,000,000 |
Reinsurance recoverables, net | 90,000,000 | 66,000,000 | 51,000,000 |
Income taxes | (86,000,000) | 8,000,000 | (64,000,000) |
Other operating assets and liabilities | 245,000,000 | 69,000,000 | 136,000,000 |
Net cash provided by operating activities | 309,000,000 | 366,000,000 | 655,000,000 |
Proceeds from sales | |||
Fixed income securities | 3,370,000,000 | 3,800,000,000 | 4,858,000,000 |
Equity securities | 1,591,000,000 | 984,000,000 | 1,257,000,000 |
Limited partnership interests | 336,000,000 | 354,000,000 | 367,000,000 |
Mortgage loans | 212,000,000 | 0 | 0 |
Other investments | 58,000,000 | 61,000,000 | 39,000,000 |
Investment collections | |||
Fixed income securities | 1,333,000,000 | 1,355,000,000 | 1,448,000,000 |
Mortgage loans | 550,000,000 | 537,000,000 | 434,000,000 |
Other investments | 50,000,000 | 76,000,000 | 168,000,000 |
Investment purchases | |||
Fixed income securities | (5,335,000,000) | (4,406,000,000) | (5,444,000,000) |
Equity securities | (1,431,000,000) | (844,000,000) | (1,086,000,000) |
Limited partnership interests | (375,000,000) | (398,000,000) | (551,000,000) |
Mortgage loans | (112,000,000) | (532,000,000) | (552,000,000) |
Other investments | (45,000,000) | (103,000,000) | (270,000,000) |
Change in short-term investments, net | 25,000,000 | (343,000,000) | (3,000,000) |
Change in policy loans and other investments, net | 54,000,000 | (63,000,000) | (69,000,000) |
Net cash provided by investing activities | 281,000,000 | 478,000,000 | 596,000,000 |
Cash flows from financing activities | |||
Contractholder fund deposits | 753,000,000 | 747,000,000 | 771,000,000 |
Contractholder fund withdrawals | (1,373,000,000) | (1,599,000,000) | (1,893,000,000) |
Proceeds from issuance of notes to related parties | 0 | 215,000,000 | 0 |
Repayment of notes to related parties | 0 | (141,000,000) | 0 |
Dividends paid | 0 | (75,000,000) | (250,000,000) |
Other | 23,000,000 | 0 | 28,000,000 |
Net cash used in financing activities | (597,000,000) | (853,000,000) | (1,344,000,000) |
Net decrease in cash | (7,000,000) | (9,000,000) | (93,000,000) |
Cash at beginning of year | 43,000,000 | 52,000,000 | 145,000,000 |
Cash at end of year | $ 36,000,000 | $ 43,000,000 | $ 52,000,000 |
General |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General | General Basis of presentation The accompanying consolidated financial statements include the accounts of Allstate Life Insurance Company (“ALIC”) and its wholly owned subsidiaries (collectively referred to as the “Company”). ALIC is wholly owned by Allstate Insurance Company (“AIC”), which is wholly owned by Allstate Insurance Holdings, LLC, a wholly owned subsidiary of The Allstate Corporation (the “Corporation”). These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). All significant intercompany accounts and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The Company operates as a single segment entity based on the manner in which the Company uses financial information to evaluate business performance and to determine the allocation of resources. Nature of operations The Company offers traditional, interest-sensitive and variable life insurance in New York and term conversion interest-sensitive life insurance countrywide. The Company previously sold traditional life insurance countrywide through June 2019 and variable life insurance nationwide through September 2017. The Company distributes its products through Allstate exclusive agents and exclusive financial specialists. The Company also offers voluntary accident and health insurance through workplace enrolling independent agents and benefits brokers in New York. The Company previously offered and continues to have in force fixed annuities such as deferred and immediate annuities. The Company also previously offered variable annuities and substantially all of this business is reinsured. The following table summarizes premiums and contract charges by product.
The Company, through several subsidiaries, operates in the U.S. (all 50 states and the District of Columbia). For 2020, the top geographic locations for direct statutory premiums and annuity considerations were New York, California, Texas, Florida and Illinois. No other jurisdiction accounted for more than 5% of direct statutory premiums and annuity considerations. Subsequent event
|
Summary of Significant Accounting Policies |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Investments Fixed income securities include bonds, asset-backed securities (“ABS”) and mortgage-backed securities (“MBS”). MBS includes residential and commercial mortgage-backed securities. Fixed income securities, which may be sold prior to their contractual maturity, are designated as available-for-sale (“AFS”) and are carried at fair value. The difference between amortized cost, net of credit loss allowances (“amortized cost, net”) and fair value, net of deferred income taxes and related deferred policy acquisition costs (“DAC”), deferred sales inducement costs (“DSI”) and reserves for life-contingent contract benefits, is reflected as a component of AOCI. The Company excludes accrued interest receivable from the amortized cost basis of its AFS fixed income securities. Cash received from calls and make-whole payments is reflected as a component of proceeds from sales and cash received from maturities and pay-downs is reflected as a component of investment collections within the Consolidated Statements of Cash Flows. Mortgage loans and loans reported in other investments (bank loans and agent loans) are carried at amortized cost, net, which represent the amount expected to be collected. The Company excludes accrued interest receivable from the amortized cost basis of its mortgage, bank and agent loans. Credit loss allowances are estimates of expected credit losses, established for loans upon origination or purchase, and are established considering all relevant information available, including past events, current conditions, and reasonable and supportable forecasts over the life of the loans. Loans are evaluated on a pooled basis when they share similar risk characteristics; otherwise, they are evaluated individually. Equity securities primarily include common stocks, exchange traded and mutual funds, non-redeemable preferred stocks and real estate investment trust equity investments. Certain exchange traded and mutual funds have fixed income securities as their underlying investments. Equity securities are carried at fair value. Equity securities without readily determinable or estimable fair values are measured using the measurement alternative, which is cost less impairment, if any, and adjustments resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. Investments in limited partnership interests are primarily accounted for in accordance with the equity method of accounting (“EMA”) and include interests in private equity funds, real estate funds and other funds. Investments in limited partnership interests purchased prior to January 1, 2018, where the Company’s interest is so minor that it exercises virtually no influence over operating and financial policies are accounted for at fair value primarily utilizing the net asset value (“NAV”) as a practical expedient to determine fair value. Short-term investments, including money market funds, commercial paper, U.S. Treasury bills and other short-term investments, are carried at fair value. Policy loans are carried at unpaid principal balances. Other investments primarily consist of bank loans, real estate, agent loans and derivatives. Bank loans are primarily senior secured corporate loans. Real estate is carried at cost less accumulated depreciation. Agent loans are loans issued to exclusive Allstate agents. Derivatives are carried at fair value. Investment income primarily consists of interest, dividends, income from limited partnership interests, rental income from real estate, and income from certain derivative transactions. Interest is recognized on an accrual basis using the effective yield method and dividends are recorded at the ex-dividend date. Interest income for ABS and MBS is determined considering estimated pay-downs, including prepayments, obtained from third-party data sources and internal estimates. Actual prepayment experience is periodically reviewed and effective yields are recalculated when differences arise between the prepayments originally anticipated and the actual prepayments received and currently anticipated. For ABS and MBS of high credit quality with fixed interest rates, the effective yield is recalculated on a retrospective basis. For all others, the effective yield is generally recalculated on a prospective basis. Net investment income for AFS fixed income securities includes the impact of accreting the credit loss allowance for the time value of money. Accrual of income is suspended for fixed income securities when the timing and amount of cash flows expected to be received is not reasonably estimable. Accrual of income is suspended for mortgage loans, bank loans and agent loans that are in default or when full and timely collection of principal and interest payments is not probable. Accrued income receivable is monitored for recoverability and when not expected to be collected is written off through net investment income. Cash receipts on investments on nonaccrual status are generally recorded as a reduction of amortized cost. Income from limited partnership interests carried at fair value is recognized based upon the changes in fair value of the investee’s equity primarily determined using NAV. Income from EMA limited partnership interests is recognized based on the Company’s share of the partnerships’ earnings. Income from EMA limited partnership interests is generally recognized on a three month delay due to the availability of the related financial statements from investees. Realized capital gains and losses include gains and losses on investment sales, changes in the credit loss allowances related to fixed income securities, mortgage loans, bank loans and agent loans, impairments, valuation changes of equity investments, including equity securities and certain limited partnerships where the underlying assets are predominately public equity securities, and periodic changes in fair value and settlements of certain derivatives including hedge ineffectiveness. Realized capital gains and losses on investment sales are determined on a specific identification basis and are net of credit losses already recognized through an allowance. Derivative and embedded derivative financial instruments Derivative financial instruments include interest rate swaps, credit default swaps, futures (interest rate and equity), options (including swaptions), interest rate caps, warrants, foreign currency swaps, foreign currency forwards, total return swaps and certain investment risk transfer reinsurance agreements. Derivatives required to be separated from the host instrument and accounted for as derivative financial instruments (“subject to bifurcation”) are embedded in equity-indexed life and annuity contracts and reinsured variable annuity contracts. All derivatives are accounted for on a fair value basis and reported as other investments, other assets, other liabilities and accrued expenses or contractholder funds. Embedded derivative instruments subject to bifurcation are also accounted for on a fair value basis and are reported together with the host contract. The change in fair value of derivatives embedded in life and annuity product contracts and subject to bifurcation is reported in contract benefits or interest credited to contractholder funds. Cash flows from embedded derivatives subject to bifurcation and derivatives receiving hedge accounting are reported consistently with the host contracts and hedged risks, respectively, within the Consolidated Statements of Cash Flows. Cash flows from other derivatives are reported in cash flows from investing activities within the Consolidated Statements of Cash Flows. When derivatives meet specific criteria, they may be designated as accounting hedges and accounted for as fair value, cash flow, foreign currency fair value or foreign currency cash flow hedges. The hedged item may be either all or a specific portion of a recognized asset, liability or an unrecognized firm commitment attributable to a particular risk for fair value hedges. At the inception of the hedge, the Company formally documents the hedging relationship and risk management objective and strategy. The documentation identifies the hedging instrument, the hedged item, the nature of the risk being hedged and the methodology used to assess the effectiveness of the hedging instrument in offsetting the exposure to changes in the hedged item’s fair value attributable to the hedged risk. For a cash flow hedge, this documentation includes the exposure to changes in the variability in cash flows attributable to the hedged risk. The Company does not exclude any component of the change in fair value of the hedging instrument from the effectiveness assessment. At each reporting date, the Company confirms that the hedging instrument continues to be highly effective in offsetting the hedged risk. Fair value hedges The change in fair value of hedging instruments used in fair value hedges of investment assets or a portion thereof is reported in net investment income, together with the change in fair value of the hedged items. The change in fair value of hedging instruments used in fair value hedges of contractholder funds liabilities or a portion thereof is reported in interest credited to contractholder funds, together with the change in fair value of the hedged items. Accrued periodic settlements on swaps are reported together with the changes in fair value of the related swaps in net investment income or interest credited to contractholder funds. The amortized cost, net for fixed income securities, the carrying value for mortgage loans or the carrying value of a designated hedged liability is adjusted for the change in fair value of the hedged risk. Cash flow hedges For hedging instruments used in cash flow hedges, the changes in fair value of the derivatives are reported in AOCI. Amounts are reclassified to net investment income or realized capital gains and losses as the hedged or forecasted transaction affects income. Accrued periodic settlements on derivatives used in cash flow hedges are reported in net investment income. The amount reported in AOCI for a hedged transaction is the cumulative gain or loss on the derivative instrument from inception of the hedge less gains or losses previously reclassified from AOCI into income. If the Company expects at any time that the loss reported in AOCI would lead to a net loss on the combination of the hedging instrument and the hedged transaction which may not be recoverable, a loss is recognized immediately in realized capital gains and losses. If an impairment loss is recognized on an asset or an additional obligation is incurred on a liability involved in a hedge transaction, any offsetting gain in AOCI is reclassified and reported together with the impairment loss or recognition of the obligation. Termination of hedge accounting If, subsequent to entering into a hedge transaction, the derivative becomes ineffective (including if the hedged item is sold or otherwise extinguished, the occurrence of a hedged forecasted transaction is no longer probable or the hedged asset has a credit loss), the Company may terminate the derivative position. The Company may also terminate derivative instruments or redesignate them as non-hedge as a result of other events or circumstances. If the derivative instrument is not terminated when a fair value hedge is no longer effective, the future gains and losses recognized on the derivative are reported in realized capital gains and losses. When a fair value hedge is no longer effective, is redesignated as non-hedge or when the derivative has been terminated, the fair value gain or loss on the hedged asset, liability or portion thereof previously recognized in income while the hedge was in place and used to adjust the amortized cost, net of hedged fixed income securities or mortgage loans or carrying value of a hedged liability, is amortized over the remaining life of the hedged asset, liability or portion thereof, and reflected in net investment income or interest credited to contractholder funds beginning in the period that hedge accounting is no longer applied. When a derivative instrument used in a cash flow hedge of an existing asset or liability is no longer effective or is terminated, the gain or loss recognized on the derivative is reclassified from AOCI to income as the hedged risk impacts income. If the derivative instrument is not terminated when a cash flow hedge is no longer effective, future gains and losses recognized on the derivative are reported in realized capital gains and losses. When a derivative instrument used in a cash flow hedge of a forecasted transaction is terminated because it is probable the forecasted transaction will not occur, the gain or loss recognized on the derivative is immediately reclassified from AOCI to realized capital gains and losses in the period that hedge accounting is no longer applied. Non-hedge derivative financial instruments For derivatives for which hedge accounting is not applied, the income statement effects, including fair value gains and losses and accrued periodic settlements, are reported either in realized capital gains and losses or in a single line item together with the results of the associated asset or liability for which risks are being managed. Securities loaned The Company’s business activities include securities lending transactions, which are used primarily to generate net investment income. The proceeds received in conjunction with securities lending transactions can be reinvested in short-term investments or fixed income securities. These transactions are short-term in nature, usually 30 days or less. The Company receives cash collateral for securities loaned in an amount generally equal to 102% and 105% of the fair value of domestic and foreign securities, respectively, and records the related obligations to return the collateral in other liabilities and accrued expenses. The carrying value of these obligations approximates fair value because of their relatively short-term nature. The Company monitors the market value of securities loaned on a daily basis and obtains additional collateral as necessary under the terms of the agreements to mitigate counterparty credit risk. The Company maintains the right and ability to repossess the securities loaned on short notice. Recognition of premium revenues and contract charges, and related benefits and interest credited Traditional life insurance products consist principally of products with fixed and guaranteed premiums and benefits, primarily term and whole life insurance products. Voluntary accident and health insurance products are expected to remain in force for an extended period and therefore are primarily classified as long-duration contracts. Premiums from these products are recognized as revenue when due from policyholders, net of any credit loss allowance for uncollectible premiums. Benefits are reflected in contract benefits and recognized over the life of the policy in relation to premiums. Immediate annuities with life contingencies, including certain structured settlement annuities, provide benefits over a period that extends beyond the period during which premiums are collected. Premiums from these products are recognized as revenue when received at the inception of the contract. Benefits are recognized in relation to premiums with the establishment of a reserve. The change in reserve over time is recorded in contract benefits and primarily relates to accumulation at the discount rate and annuitant mortality. Profits from these policies come primarily from investment income, which is recognized over the life of the contract. Interest-sensitive life contracts, such as universal life and single premium life, are insurance contracts whose terms are not fixed and guaranteed. The terms that may be changed include premiums paid by the contractholder, interest credited to the contractholder account balance and contract charges assessed against the contractholder account balance. Premiums from these contracts are reported as contractholder fund deposits. Contract charges consist of fees assessed against the contractholder account balance for the cost of insurance (mortality risk), contract administration and surrender of the contract prior to contractually specified dates. These contract charges are recognized as revenue when assessed against the contractholder account balance. Contract benefits include life-contingent benefit payments in excess of the contractholder account balance. Contracts that do not subject the Company to significant risk arising from mortality or morbidity are referred to as investment contracts. Fixed annuities, including market value adjusted annuities, equity-indexed annuities and immediate annuities without life contingencies, are considered investment contracts. Consideration received for such contracts is reported as contractholder fund deposits. Contract charges for investment contracts consist of fees assessed against the contractholder account balance for maintenance, administration and surrender of the contract prior to contractually specified dates, and are recognized when assessed against the contractholder account balance. Interest credited to contractholder funds represents interest accrued or paid on interest-sensitive life and investment contracts. Crediting rates for certain fixed annuities and interest-sensitive life contracts are adjusted periodically by the Company to reflect current market conditions subject to contractually guaranteed minimum rates. Crediting rates for indexed life and annuities are generally based on a specified interest rate index or an equity index, such as the Standard & Poor’s 500 Index (“S&P 500”). Interest credited also includes amortization of DSI expenses. DSI is amortized into interest credited using the same method used to amortize DAC. Contract charges for variable life and variable annuity products consist of fees assessed against the contractholder account balances for contract maintenance, administration, mortality, expense and surrender of the contract prior to contractually specified dates. Contract benefits incurred for variable annuity products include guaranteed minimum death, income, withdrawal and accumulation benefits. Substantially all of the Company’s variable annuity business is ceded through reinsurance agreements and the contract charges and contract benefits related thereto are reported net of reinsurance ceded. Other revenue Other revenue represents gross dealer concessions received in connection with sales of non-proprietary products by Allstate exclusive agents and exclusive financial specialists. Other revenue is recognized when performance obligations are fulfilled. Deferred policy acquisition and sales inducement costs Costs that are related directly to the successful acquisition of new or renewal life insurance policies and investment contracts are deferred and recorded as DAC. These costs are principally agent and broker remuneration and certain underwriting expenses. DSI costs, which are deferred and recorded as other assets, relate to sales inducements offered on sales to new customers, principally on fixed annuity and interest-sensitive life contracts. These sales inducements are primarily in the form of additional credits to the customer’s account balance or enhancements to interest credited for a specified period which are in excess of the rates currently being credited to similar contracts without sales inducements. All other acquisition costs are expensed as incurred and included in operating costs and expenses. Amortization of DAC is included in amortization of deferred policy acquisition costs and is described in more detail below. DSI is amortized into income using the same methodology and assumptions as DAC and is included in interest credited to contractholder funds. For traditional life and voluntary accident and health insurance, DAC is amortized over the premium paying period of the related policies in proportion to the estimated revenues on such business. Assumptions used in the amortization of DAC and reserve calculations are established at the time the policy is issued and are generally not revised during the life of the policy. Any deviations from projected business in force resulting from actual policy terminations differing from expected levels and any estimated premium deficiencies may result in a change to the rate of amortization in the period such events occur. Generally, the amortization periods for these policies approximates the estimated lives of the policies. The Company periodically reviews the recoverability of DAC using actual experience and current assumptions. Traditional life insurance products, immediate annuities with life contingencies, and voluntary accident and health insurance products are reviewed individually. If actual experience and current assumptions are adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required for any remaining deficiency. For interest-sensitive life insurance and fixed annuities, DAC and DSI are amortized in proportion to the incidence of the total present value of gross profits, which includes both actual historical gross profits (“AGP”) and estimated future gross profits (“EGP”) expected to be earned over the estimated lives of the contracts. The amortization is net of interest on the prior period DAC balance using rates established at the inception of the contracts. Actual amortization periods generally range from 15-30 years; however, incorporating estimates of the rate of customer surrenders, partial withdrawals and deaths generally results in the majority of the DAC being amortized during the surrender charge period, which is typically 10-20 years for interest-sensitive life and 5-10 years for fixed annuities. The rate of DAC and DSI amortization is reestimated and adjusted by a cumulative charge or credit to income when there is a difference between the incidence of actual versus expected gross profits in a reporting period or when there is a change in total EGP. When DAC or DSI amortization or a component of gross profits for a quarterly period is potentially negative (which would result in an increase of the DAC or DSI balance) as a result of negative AGP, the specific facts and circumstances surrounding the potential negative amortization are considered to determine whether it is appropriate for recognition in the consolidated financial statements. Negative amortization is only recorded when the increased DAC or DSI balance is determined to be recoverable based on facts and circumstances. Recapitalization of DAC and DSI is limited to the originally deferred costs plus interest. AGP and EGP primarily consist of the following components: contract charges for the cost of insurance less mortality costs and other benefits; investment income and realized capital gains and losses less interest credited; and surrender and other contract charges less maintenance expenses. The principal assumptions for determining the amount of EGP are mortality, persistency, expenses, investment returns, including capital gains and losses on assets supporting contract liabilities, interest crediting rates to contractholders, and the effects of any hedges. For products whose supporting investments are exposed to capital losses in excess of the Company’s expectations which may cause periodic AGP to become temporarily negative, EGP and AGP utilized in DAC and DSI amortization may be modified to exclude the excess capital losses. The Company performs quarterly reviews of DAC and DSI recoverability for interest-sensitive life and fixed annuity contracts using current assumptions. If a change in the amount of EGP is significant, it could result in the unamortized DAC or DSI not being recoverable, resulting in a charge which is included as a component of amortization of deferred policy acquisition costs or interest credited to contractholder funds, respectively. The DAC and DSI balances presented include adjustments to reflect the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized capital gains or losses in the respective product investment portfolios were actually realized. The adjustments are recorded net of tax in AOCI. DAC, DSI and deferred income taxes determined on unrealized capital gains and losses and reported in AOCI recognize the impact on shareholder’s equity consistently with the amounts that would be recognized in the income statement on realized capital gains and losses. Customers of the Company may exchange one insurance policy or investment contract for another offered by the Company, or make modifications to an existing investment or life contract issued by the Company. These transactions are identified as internal replacements for accounting purposes. Internal replacement transactions determined to result in replacement contracts that are substantially unchanged from the replaced contracts are accounted for as continuations of the replaced contracts. Unamortized DAC and DSI related to the replaced contracts continue to be deferred and amortized in connection with the replacement contracts. For interest-sensitive life and investment contracts, the EGP of the replacement contracts are treated as a revision to the EGP of the replaced contracts in the determination of amortization of DAC and DSI. For traditional life insurance policies, any changes to unamortized DAC that result from replacement contracts are treated as prospective revisions. Any costs associated with the issuance of replacement contracts are characterized as maintenance costs and expensed as incurred. Internal replacement transactions determined to result in a substantial change to the replaced contracts are accounted for as an extinguishment of the replaced contracts, and any unamortized DAC and DSI related to the replaced contracts are eliminated with a corresponding charge to amortization of deferred policy acquisition costs or interest credited to contractholder funds, respectively. The costs assigned to the right to receive future cash flows from certain business purchased from other insurers are also classified as DAC in the Consolidated Statements of Financial Position. The costs capitalized represent the present value of future profits expected to be earned over the lives of the contracts acquired. These costs are amortized as profits emerge over the lives of the acquired business and are periodically evaluated for recoverability. The present value of future profits was $3 million as of both December 31, 2020 and 2019. Amortization expense of the present value of future profits was $508 thousand, $357 thousand and $249 thousand in 2020, 2019 and 2018, respectively. Reinsurance In the normal course of business, the Company seeks to limit aggregate and single exposure to losses on large risks by purchasing reinsurance. The Company has also used reinsurance to effect the disposition of certain blocks of business. The amounts reported as reinsurance recoverables include amounts billed to reinsurers on losses paid as well as estimates of amounts expected to be recovered from reinsurers on insurance reserves and contractholder funds that have not yet been paid. Reinsurance recoverables on unpaid losses are estimated based upon assumptions consistent with those used in establishing the liabilities related to the underlying reinsured contracts. Insurance reserves are reported gross of reinsurance recoverables. Reinsurance premiums are generally reflected in income in a manner consistent with the recognition of premiums on the reinsured contracts. Reinsurance does not extinguish the Company’s primary liability under the policies written. Therefore, the Company evaluates reinsurer counterparty credit risk and records reinsurance recoverables net of credit loss allowances. The Company assesses counterparty credit risk for individual reinsurers separately when more relevant or on a pooled basis when shared risk characteristics exist. The evaluation considers the credit quality of the reinsurer and the period over which the recoverable balances are expected to be collected. The Company considers factors including past events, current conditions and reasonable and supportable forecasts in the development of the estimate of credit loss allowances. The Company uses a probability of default and loss given default model developed independently of the Company to estimate current expected credit losses. The model utilizes factors including historical industry factors based on the probability of liquidation, and incorporates current loss given default factors reflective of the industry. The Company monitors the credit ratings of reinsurer counterparties and evaluates the circumstances surrounding credit rating changes as inputs into its credit loss assessments. Uncollectible reinsurance recoverable balances are written off against the allowances when there is no reasonable expectation of recovery. The changes in the allowance are reported in contract benefits. Income taxes Income taxes are accounted for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax bases of assets and liabilities at the enacted tax rates. The principal assets and liabilities giving rise to such differences are insurance reserves, investments (including unrealized capital gains and losses) and DAC. A deferred tax asset valuation allowance is established when it is more likely than not such assets will not be realized. The Company recognizes interest expense related to income tax matters in income tax expense and penalties in operating costs and expenses. Reserve for life-contingent contract benefits The reserve for life-contingent contract benefits payable under insurance policies, including traditional life insurance, life-contingent immediate annuities and voluntary accident and health insurance products, is computed on the basis of long-term actuarial assumptions of future investment yields, mortality, morbidity, policy terminations and expenses. These assumptions, which for traditional life insurance are applied using the net level premium method, include provisions for adverse deviation and generally vary by characteristics such as type of coverage, year of issue and policy duration. The assumptions are established at the time the policy is issued and are generally not changed during the life of the policy. The Company periodically reviews the adequacy of reserves using actual experience and current assumptions. If actual experience and current assumptions are adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required for any remaining deficiency. Traditional life insurance products, immediate annuities with life contingencies, and voluntary accident and health insurance are reviewed individually. The Company also reviews these policies for circumstances where projected profits would be recognized in early years followed by projected losses in later years. If this circumstance exists, the Company will accrue a liability, during the period of profits, to offset the losses at such time as the future losses are expected to commence using a method updated prospectively over time. To the extent that unrealized gains on fixed income securities would result in a premium deficiency if those gains were realized, the related increase in reserves for certain immediate annuities with life contingencies is recorded net of tax as a reduction of unrealized net capital gains included in AOCI. Contractholder funds Contractholder funds represent interest-bearing liabilities arising from the sale of products such as interest-sensitive life insurance and fixed annuities. Contractholder funds primarily comprise cumulative deposits received and interest credited to the contractholder less cumulative contract benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses. Contractholder funds also include reserves for secondary guarantees on interest-sensitive life insurance and certain fixed annuity contracts and reserves for certain guarantees on reinsured variable annuity contracts. Separate accounts Separate accounts assets are carried at fair value. The assets of the separate accounts are legally segregated and available only to settle separate accounts contract obligations. Separate accounts liabilities represent the contractholders’ claims to the related assets and are carried at an amount equal to the separate accounts assets. Investment income and realized capital gains and losses of the separate accounts accrue directly to the contractholders and therefore are not included in the Company’s Consolidated Statements of Operations and Comprehensive Income. Deposits to and surrenders and withdrawals from the separate accounts are reflected in separate accounts liabilities and are not included in consolidated cash flows. Absent any contract provision wherein the Company provides a guarantee, variable annuity and variable life insurance contractholders bear the investment risk that the separate accounts’ funds may not meet their stated investment objectives. Substantially all of the Company’s variable annuity business was reinsured beginning in 2006. Measurement of credit losses The Company carries an allowance for expected credit losses for all financial assets measured at amortized cost on the Consolidated Statements of Financial Position. The Company considers past events, current conditions and reasonable and supportable forecasts in estimating an allowance for credit losses. The Company also carries a credit loss allowance for fixed income securities where applicable and, when amortized cost is reported, it is net of credit loss allowances. For additional information, refer to the Investments or Reinsurance topics of this section. The Company also estimates a credit loss allowance for commitments to fund mortgage loans, bank loans and agent loans unless they are unconditionally cancellable by the Company. The related allowance is reported in other liabilities and accrued expenses. The Company’s allowance for credit losses is presented in the following table.
Off-balance sheet financial instruments Commitments to invest, commitments to purchase private placement securities, commitments to fund loans, financial guarantees and credit guarantees have off-balance sheet risk because their contractual amounts are not recorded in the Company’s Consolidated Statements of Financial Position (see Note 7 and Note 11). Consolidation of variable interest entities (“VIEs”) The Company consolidates VIEs when it is the primary beneficiary. A primary beneficiary is the variable interest holder in a VIE with both the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and the obligation to absorb losses, or the right to receive benefits, that could potentially be significant to the VIE. Adopted accounting standard Measurement of Credit Losses on Financial Instruments Effective January 1, 2020 the Company adopted new Financial Accounting Standards Board (“FASB”) guidance related to the measurement of credit losses on financial instruments that primarily affected mortgage loans, bank loans and reinsurance recoverables. Upon adoption of the guidance, the Company recorded a total allowance for expected credit losses of $79 million, pre-tax. After consideration of existing valuation allowances maintained prior to adopting the new guidance, the Company increased its valuation allowances for credit losses to conform to the new requirements which resulted in recognizing a cumulative effect decrease in retained income of $49 million, after-tax, at the date of adoption. The measurement of credit losses for AFS fixed income securities measured at fair value is not affected except that credit losses recognized are limited to the amount by which fair value is below amortized cost and the credit loss adjustment is recognized through a valuation allowance which may change over time but once recorded cannot subsequently be reduced to an amount below zero. Previously these credit loss adjustments were recorded as other-than-temporary impairments and were not reversed once recorded. Pending accounting standards Accounting for Long-Duration Insurance Contracts In August 2018, the FASB issued guidance revising the accounting for certain long-duration insurance contracts. The new guidance introduces material changes to the measurement of the Company’s reserves for traditional life, life-contingent immediate annuities and certain voluntary accident and health insurance products. Under the new guidance, measurement assumptions, including those for mortality, morbidity and policy terminations, will be required to be reviewed and updated at least annually. The effect of updating measurement assumptions other than the discount rate are required to be measured on a retrospective basis and reported in net income. In addition, reserves under the new guidance are required to be discounted using an upper-medium grade fixed income instrument yield that is updated through other comprehensive income at each reporting date. Current GAAP requires the measurement of reserves to utilize assumptions set at policy issuance unless updated current assumptions indicate that recorded reserves are deficient. The new guidance also requires DAC and other capitalized balances currently amortized in proportion to premiums or gross profits to be amortized on a constant level basis over the expected term for all long-duration insurance contracts. DAC will not be subject to loss recognition testing but will be reduced when actual lapse experience exceeds expected experience. The new guidance will no longer require adjustments to DAC and DSI related to unrealized gains and losses on investment securities supporting the related business. All market risk benefit product features will be measured at fair value with changes in fair value recorded in net income with the exception of changes in the fair value attributable to changes in the reporting entity’s own credit risk, which are required to be recognized in OCI. Substantially all of the Company’s market risk benefits relate to variable annuities that are reinsured, and therefore these impacts are not expected to be material to the Company. The new guidance is effective for financial statements issued for reporting periods beginning after December 15, 2022 and restatement of prior periods presented is required. Early adoption is permitted and if elected, restatement of only one prior period is required. The new guidance will be applied to affected contracts and DAC on the basis of existing carrying amounts at the earliest period presented or retrospectively using actual historical experience as of contract inception. The new guidance for market risk benefits is required to be adopted retrospectively. The Company is evaluating the anticipated impacts of applying the new guidance to both retained income and AOCI. The requirements of the new guidance represent a material change from existing GAAP, however, the underlying economics of the business and related cash flows are unchanged. The Company anticipates the financial statement impact of adopting the new guidance to be material, largely attributed to the impact of transitioning to a discount rate based on an upper-medium grade fixed income investment yield. The Company expects the most significant impacts will occur in the run-off annuity business. The revised accounting for DAC will be applied prospectively using the new model and any DAC effects existing in AOCI as a result of applying existing GAAP at the date of adoption will be eliminated. Simplifications to the Accounting for Income Taxes In December 2019, the FASB issued amendments to simplify the accounting for income taxes. The amendments eliminate certain exceptions in the existing guidance including those related to intraperiod tax allocation and deferred tax liability recognition when a subsidiary meets the criteria to apply the equity method of accounting. The amendments require recognition of the effect of an enacted change in tax laws or rates in the period that includes the enactment date, provide an option to not allocate taxes to a legal entity that is not subject to tax as well as other minor changes. The amendments are effective for reporting periods beginning after December 15, 2020. The new guidance specifies which amendments should be applied prospectively, retrospectively or on a modified retrospective basis through a cumulative-effect adjustment to retained income as of the beginning of the year of adoption. The impact of adoption is not expected to be material to the Company’s results of operations or financial position.
|
Supplemental Cash Flow Information |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information | Supplemental Cash Flow Information Non-cash investing activities include $5 million, $67 million and $43 million related to mergers and exchanges completed with equity securities, fixed income securities and limited partnerships, and modifications of certain mortgage loans and other investments in 2020, 2019 and 2018, respectively. Non-cash investing activities also include transfers of invested assets related to a coinsurance reinsurance agreement with Allstate Assurance Company (“AAC”) (see Note 4). Liabilities for collateral received in conjunction with the Company’s securities lending program were $331 million, $522 million and $517 million as of December 31, 2020, 2019 and 2018, respectively, and are reported in other liabilities and accrued expenses. Obligations to return cash collateral for over-the-counter (“OTC”) and cleared derivatives were $3 million, $8 million and $8 million as of December 31, 2020, 2019 and 2018, respectively, and are reported in other liabilities and accrued expenses or other investments. The accompanying cash flows are included in cash flows from operating activities in the Consolidated Statements of Cash Flows along with the activities resulting from management of the proceeds, which for the years ended December 31 are as follows:
|
Related Party Transactions |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions | Related Party Transactions Business operations The Company uses services performed by AIC and other affiliates, and business facilities owned or leased and operated by AIC in conducting its business activities. In addition, the Company shares the services of employees with AIC. The Company reimburses its affiliates for the operating expenses incurred on behalf of the Company. The Company is charged for the cost of these operating expenses based on the level of services provided. Operating expenses, including compensation, retirement and other benefit programs (see Note 15), allocated to the Company were $191 million, $211 million and $235 million in 2020, 2019 and 2018, respectively. Agent loan sale and securitization On December 22, 2016, ALIC’s subsidiary Allstate Finance Company, LLC (“AFC”) sold agent loans with a fair value of $419 million to affiliate Allstate Finance Company Agency Loans LLC (“AFCAL”) and AFCAL used the loans as collateral in the issuance of notes. On December 16, 2019, investors in the notes approved redemption of the original notes and AFCAL issued replacement notes at new terms. Concurrent with redemption, AFC sold agent loans with a fair value of $222 million to AFCAL, and AFCAL used the loans as collateral in the issuance of additional notes. Investors in the notes are as follows:
_______________ (1)As of December 31, 2020 and 2019, $74 million of these notes have an annual interest rate of 3.16% and $140 million have an annual interest rate of 3.36%. AFCAL is a VIE established as a bankruptcy-remote entity whose assets are isolated from those of ALIC and are not available to ALIC’s creditors. ALIC is the primary beneficiary since ALIC has control over the significant activities of AFCAL, the obligation to absorb significant losses and the rights to residual returns. Therefore, AFCAL is included in ALIC’s consolidated financial statements. Transactions between ALIC, AFC and AFCAL are eliminated in consolidation. The Company’s Consolidated Statements of Financial Position included $568 million of agent loans, zero cash and $214 million of notes due to related parties as of December 31, 2020 and $612 million of agent loans, $1 million of cash and $214 million of notes due to related parties as of December 31, 2019 associated with AFCAL. The Company incurred interest expense related to these notes of $7 million in 2020 and $5 million in both 2019 and 2018. Reinsurance The Company has coinsurance reinsurance agreements with its unconsolidated affiliate American Heritage Life Insurance Company (“AHL”) whereby the Company assumes certain interest-sensitive life insurance, fixed annuity contracts and accident and health insurance policies. The amounts assumed are disclosed in Note 9. Effective December 1, 2020, ALIC entered into a coinsurance reinsurance agreement with AAC to assume all of AAC’s term and interest-sensitive life insurance policies, and to recapture certain interest-sensitive life insurance policies previously ceded to AAC. In connection with the agreement, the Company recorded invested assets of $534 million, DAC of $245 million, reserve for life-contingent contract benefits of $118 million, contractholder funds of $256 million and reduced reinsurance recoverables by $397 million. The $59 million gain on the transaction was recorded as an increase to additional capital paid-in since the transaction was between entities under common control. ALIC enters into certain intercompany reinsurance transactions with its wholly owned subsidiaries. ALIC enters into these transactions in order to maintain underwriting control and spread risk among various legal entities. These reinsurance agreements have been approved by the appropriate regulatory authorities. All significant intercompany transactions have been eliminated in consolidation. Broker-Dealer agreement The Company receives distribution services from Allstate Financial Services, LLC, an affiliated broker-dealer company, for certain annuity and variable life insurance contracts sold by Allstate exclusive agents and exclusive financial specialists. For these services, the Company incurred commission and other distribution expenses of $3 million in each year of 2020, 2019 and 2018. Structured settlement annuities The Company previously issued structured settlement annuities, a type of immediate annuity, to fund structured settlements in matters involving AIC. In most cases, these annuities were issued under a “qualified assignment” whereby Allstate Assignment Company and prior to July 1, 2001 Allstate Settlement Corporation (“ASC”), both wholly owned subsidiaries of ALIC, purchased annuities from ALIC and assumed AIC’s obligation to make future payments. AIC issued surety bonds to guarantee the payment of structured settlement benefits assumed by ASC (from both AIC and non-related parties) and funded by certain annuity contracts issued by the Company through June 30, 2001. ASC entered into a General Indemnity Agreement pursuant to which it indemnified AIC for any liabilities associated with the surety bonds and gave AIC certain collateral security rights with respect to the annuities and certain other rights in the event of any defaults covered by the surety bonds. ALIC guaranteed the payment of structured settlement benefits on all contracts issued on or after July 1, 2001. Reserves recorded by the Company for annuities that are guaranteed by the surety bonds of AIC were $4.73 billion and $4.57 billion as of December 31, 2020 and 2019, respectively. Income taxes The Company is a party to a federal income tax allocation agreement with the Corporation (see Note 12). Surplus notes On December 2, 2016, the Company purchased for cash a $40 million, 3.07% surplus note due December 2, 2036 that was issued by AAC. No payment of principal or interest was permitted on the surplus note without the written approval from the proper regulatory authority. The surplus note was classified as fixed income securities on the Consolidated Statements of Financial Position. The Company recorded investment income on this surplus note of $1 million in each year of 2020, 2019 and 2018. On December 1, 2020, with regulatory approval, AAC repaid the entire principal of this surplus note. Liquidity and intercompany loan agreements The Company is party to an Amended and Restated Intercompany Liquidity Agreement (“Liquidity Agreement”) with certain of its affiliates, which include, but are not limited to, AIC, AAC and the Corporation. The Liquidity Agreement allows for short-term advances of funds to be made between parties for liquidity and other general corporate purposes. The Liquidity Agreement does not establish a commitment to advance funds on the part of any party. The Company and AIC each serve as a lender and borrower, AAC and certain other affiliates serve only as borrowers, and the Corporation serves only as a lender. The maximum amount of advances each party may make or receive is limited to $1 billion. Netting or offsetting of advances made and received is not permitted. Advances between the parties are required to have specified due dates less than or equal to 364 days from the date of the advance and be payable upon demand by written request from the lender at least 10 business days prior to the demand date. The borrower may make prepayments of the outstanding principal balance of an advance without penalty. Advances will bear interest equal to or greater than the rate applicable to 30-day commercial paper issued by the Corporation on the date the advance is made with an adjustment on the first day of each month thereafter. The Company had no amounts outstanding under the Liquidity Agreement as of December 31, 2020 or 2019. In addition to the Liquidity Agreement, the Company has an intercompany loan agreement with the Corporation. The amount of intercompany loans available to the Company is at the discretion of the Corporation. The maximum amount of loans the Corporation will have outstanding to all its eligible subsidiaries at any given point in time is limited to $1 billion. The Corporation may use commercial paper borrowings, bank lines of credit and securities lending to fund intercompany borrowings. The Company had no amounts outstanding under the intercompany loan agreement as of December 31, 2020 or 2019. Road Bay Investments, LLC (“RBI”), a consolidated subsidiary of ALIC, has a Revolving Loan Credit Agreement (“Credit Agreement”) with AHL, according to which AHL agreed to extend revolving credit loans to RBI. As security for its obligations under the Credit Agreement, RBI entered into a Pledge and Security Agreement with AHL, according to which RBI agreed to grant a pledge of and security interest in RBI’s right, title, and interest in certain assets of RBI. The Company had no amounts outstanding under the Credit Agreement as of December 31, 2020 or 2019. Capital support agreement The Company has a capital support agreement with AIC. Under the terms of this agreement, AIC agrees to provide capital to maintain the amount of statutory capital and surplus necessary to maintain a company action level risk-based capital (“RBC”) ratio of at least 150%. AIC’s obligation to provide capital to the Company under the agreement is limited to an aggregate amount of $1 billion. In exchange for providing this capital, the Company will pay AIC an annual commitment fee of 1% of the amount of the Capital and Surplus maximum that remains available on January 1 of such year. The Company or AIC have the right to terminate this agreement when: 1) the Company qualifies for a financial strength rating from S&P, Moody’s or A.M. Best, without giving weight to the existence of this agreement, that is the same or better than its rating with such support; 2) the Company’s RBC ratio is at least 300%; or 3) AIC no longer directly or indirectly owns at least 50% of the voting stock of the Company. During 2020 and 2019, no capital had been provided by AIC under this agreement. External financing agreement In January 2017, ALIC Reinsurance Company (“ALIC Re”), a wholly owned subsidiary of the Company, entered into a master transaction agreement with Bueller Financing LLC (“Bueller”), an external financing provider. In accordance with the agreement, Bueller issued a variable funding puttable note (“credit-linked note”) that is held in a trust. The credit-linked note can be put back to Bueller for cash in the event certain ALIC Re statutory reserves and capital are depleted. The balance of the credit-linked note will vary based on the statutory reserve balance with a maximum value of $1.75 billion. The impacts of the agreement are eliminated in consolidation and have no impact on the Consolidated Statements of Financial Position. Dividends The Company did not pay dividends in 2020 and paid $75 million and $250 million to AIC in the form of cash in 2019 and 2018, respectively.
|
Investments |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Investments Portfolio composition The composition of the investment portfolio is presented as follows:
Fair values The amortized cost, gross unrealized gains and losses and fair value for fixed income securities are as follows:
Scheduled maturities The scheduled maturities for fixed income securities are as follows:
Actual maturities may differ from those scheduled as a result of calls and make-whole payments by the issuers. ABS and MBS are shown separately because of potential prepayment of principal prior to contractual maturity dates. Net investment income Net investment income for the years ended December 31 is as follows:
Realized capital gains and losses Realized capital gains (losses) by asset type for the years ended December 31 are as follows:
Realized capital gains (losses) by transaction type for the years ended December 31 are as follows:
_______________ (1)Due to the adoption of the measurement of credit losses on financial instruments accounting standard, prior period other-than-temporary impairment write-downs are now presented as credit losses. (2)Includes valuation of equity securities and certain limited partnership interests where the underlying assets are predominately public equity securities. Gross realized gains (losses) on sales of fixed income securities for the years ended December 31 are as follows:
The following table presents the net pre-tax appreciation (decline) recognized in net income of equity securities and limited partnership interests carried at fair value that are still held as of December 31, 2020 and 2019, respectively.
Credit losses recognized in net income (1) for the years ended December 31 are as follows:
_______________ (1)Due to the adoption of the measurement of credit losses on financial instruments accounting standard, realized capital losses previously reported as other-than-temporary impairment write-downs are now presented as credit losses. Unrealized net capital gains and losses Unrealized net capital gains and losses included in AOCI are as follows:
____________ (1)Unrealized net capital gains and losses for limited partnership interests represent the Company’s share of EMA limited partnerships’ OCI. Fair value and gross unrealized gains and losses are not applicable. (2)The insurance reserves adjustment represents the amount by which the reserve balance would increase if the net unrealized gains in the applicable product portfolios were realized and reinvested at lower interest rates, resulting in a premium deficiency. This adjustment primarily relates to structured settlement annuities with life contingencies (a type of immediate fixed annuity). (3)The DAC and DSI adjustment balance represents the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized gains or losses in the respective product portfolios were realized. Change in unrealized net capital gains and losses The change in unrealized net capital gains and losses for the years ended December 31 is as follows:
Mortgage loans The Company’s mortgage loans are commercial mortgage loans collateralized by a variety of commercial real estate property types located across the United States and totaled $3.36 billion and $3.99 billion, net of credit loss allowance, as of December 31, 2020 and 2019, respectively. Substantially all of the commercial mortgage loans are non-recourse to the borrower. The following table shows the principal geographic distribution of commercial real estate represented in the Company’s mortgage loan portfolio. No other state represented more than 5% of the portfolio as of December 31.
The types of properties collateralizing the mortgage loans as of December 31 are as follows:
The contractual maturities of the mortgage loan portfolio as of December 31, 2020 are as follows:
Limited partnerships Investments in limited partnership interests include interests in private equity funds, real estate funds and other funds. Principal factors influencing carrying value appreciation or decline include operating performance, comparable public company earnings multiples, capitalization rates and the economic environment. For equity method limited partnerships, the Company recognizes an impairment loss when evidence demonstrates that the loss is other than temporary. Evidence of a loss in value that is other than temporary may include the absence of an ability to recover the carrying amount of the investment or the inability of the investee to sustain a level of earnings that would justify the carrying amount of the investment. Changes in fair value limited partnerships are recorded through net investment income and therefore are not tested for impairment. The carrying value for limited partnership interest as of December 31 is as follows:
____________ (1)Other consists of certain limited partnership interests where the underlying assets are predominately public equity and debt securities. Municipal bonds The Company maintains a diversified portfolio of municipal bonds which totaled $2.01 billion and $1.76 billion as of December 31, 2020 and 2019, respectively. The municipal bond portfolio includes general obligations of state and local issuers and revenue bonds (including pre-refunded bonds, which are bonds for which an irrevocable trust has been established to fund the remaining payments of principal and interest). The following table shows the principal geographic distribution of municipal bond issuers represented in the Company’s portfolio as of December 31. No other state represents more than 5% of the portfolio.
Short-term investments Short-term investments, including money market funds, commercial paper, U.S. Treasury bills and other short-term investments, are carried at fair value. As of December 31, 2020 and 2019, the fair value of short-term investments totaled $974 million and $1.19 billion, respectively. Policy loans Policy loans are carried at unpaid principal balances. As of December 31, 2020 and 2019, the carrying value of policy loans totaled $582 million and $557 million, respectively. Other investments Other investments primarily consist of agent loans, real estate, bank loans and derivatives. Agent loans are loans issued to exclusive Allstate agents and are carried at amortized cost, net. Real estate is carried at cost less accumulated depreciation. Bank loans are primarily senior secured corporate loans and are carried at amortized cost, net. Derivatives are carried at fair value. The following table summarizes other investments by asset type.
Concentration of credit risk As of December 31, 2020, the Company is not exposed to any credit concentration risk of a single issuer and its affiliates greater than 10% of the Company’s shareholder’s equity, other than the U.S. government and its agencies. Securities loaned The Company’s business activities include securities lending programs with third parties, mostly large banks. As of December 31, 2020 and 2019, fixed income and equity securities with a carrying value of $322 million and $506 million, respectively, were on loan under these agreements. Interest income on collateral, net of fees, was $1 million in each of 2020, 2019 and 2018. Other investment information Included in fixed income securities are below investment grade assets totaling $2.99 billion and $2.83 billion as of December 31, 2020 and 2019, respectively. As of December 31, 2020, fixed income securities and short-term investments with a carrying value of $21 million were on deposit with regulatory authorities as required by law. As of December 31, 2020, the carrying value of fixed income securities and other investments that were non-income producing was $38 million. Portfolio monitoring and credit losses Fixed income securities The Company has a comprehensive portfolio monitoring process to identify and evaluate each fixed income security that may require a credit loss allowance. For each fixed income security in an unrealized loss position, the Company assesses whether management with the appropriate authority has made the decision to sell or whether it is more likely than not the Company will be required to sell the security before recovery of the amortized cost basis for reasons such as liquidity, contractual or regulatory purposes. If a security meets either of these criteria, any existing credit loss allowance would be written-off against the amortized cost basis of the asset along with any remaining unrealized losses, with incremental losses recorded in earnings. If the Company has not made the decision to sell the fixed income security and it is not more likely than not the Company will be required to sell the fixed income security before recovery of its amortized cost basis, the Company evaluates whether it expects to receive cash flows sufficient to recover the entire amortized cost basis of the security. The Company calculates the estimated recovery value based on the best estimate of future cash flows considering past events, current conditions and reasonable and supportable forecasts. The estimated future cash flows are discounted at the security’s current effective rate and is compared to the amortized cost of the security. The determination of cash flow estimates is inherently subjective, and methodologies may vary depending on facts and circumstances specific to the security. All reasonably available information relevant to the collectability of the security is considered when developing the estimate of cash flows expected to be collected. That information generally includes, but is not limited to, the remaining payment terms of the security, prepayment speeds, the financial condition and future earnings potential of the issue or issuer, expected defaults, expected recoveries, the value of underlying collateral, origination vintage year, geographic concentration of underlying collateral, available reserves or escrows, current subordination levels, third-party guarantees and other credit enhancements. Other information, such as industry analyst reports and forecasts, credit ratings, financial condition of the bond insurer for insured fixed income securities, and other market data relevant to the realizability of contractual cash flows, may also be considered. The estimated fair value of collateral will be used to estimate recovery value if the Company determines that the security is dependent on the liquidation of collateral for ultimate settlement. If the Company does not expect to receive cash flows sufficient to recover the entire amortized cost basis of the fixed income security, a credit loss allowance is recorded in earnings for the shortfall in expected cash flows; however, the amortized cost, net of the credit loss allowance, may not be lower than the fair value of the security. The portion of the unrealized loss related to factors other than credit remains classified in AOCI. If the Company determines that the fixed income security does not have sufficient cash flow or other information to estimate a recovery value for the security, the Company may conclude that the entire decline in fair value is deemed to be credit related and the loss is recorded in earnings. When a security is sold or otherwise disposed or when the security is deemed uncollectible and written off, the Company removes amounts previously recognized in the credit loss allowance. Recoveries after write-offs are recognized when received. Accrued interest excluded from the amortized cost of fixed income securities totaled $198 million as of December 31, 2020 and is reported within the accrued investment income line of the Consolidated Statements of Financial Position. The Company monitors accrued interest and writes off amounts when they are not expected to be received. The Company’s portfolio monitoring process includes a quarterly review of all securities to identify instances where the fair value of a security compared to its amortized cost is below internally established thresholds. The process also includes the monitoring of other credit loss indicators such as ratings, ratings downgrades and payment defaults. The securities identified, in addition to other securities for which the Company may have a concern, are evaluated for potential credit losses using all reasonably available information relevant to the collectability or recovery of the security. Inherent in the Company’s evaluation of credit losses for these securities are assumptions and estimates about the financial condition and future earnings potential of the issue or issuer. Some of the factors that may be considered in evaluating whether a decline in fair value requires a credit loss allowance are: 1) the financial condition, near-term and long-term prospects of the issue or issuer, including relevant industry specific market conditions and trends, geographic location and implications of rating agency actions and offering prices; 2) the specific reasons that a security is in an unrealized loss position, including overall market conditions which could affect liquidity; and 3) the extent to which the fair value has been less than amortized cost. Rollforward of credit loss allowance for fixed income securities for the year ended December 31, 2020 is as follows:
____________ (1)Allowance for fixed income securities as of December 31, 2020 comprised $1 million of ABS. The following table summarizes the gross unrealized losses and fair value of securities by the length of time that individual securities have been in a continuous unrealized loss position.
The following table summarizes gross unrealized losses by unrealized loss position and credit quality as of December 31, 2020.
_______________ (1)Below investment grade fixed income securities include $7 million that have been in an unrealized loss position for less than twelve months. (2)Related to securities with an unrealized loss position less than 20% of amortized cost, net, the degree of which suggests that these securities do not pose a high risk of having credit losses. (3)No below investment grade fixed income securities have been in an unrealized loss position for a period of twelve or more consecutive months. (4)Evaluated based on factors such as discounted cash flows and the financial condition and near-term and long-term prospects of the issue or issuer and were determined to have adequate resources to fulfill contractual obligations. Investment grade is defined as a security having a rating of Aaa, Aa, A or Baa from Moody’s, a rating of AAA, AA, A or BBB from S&P Global Ratings (“S&P”), a comparable rating from another nationally recognized rating agency, or a comparable internal rating if an externally provided rating is not available. Market prices for certain securities may have credit spreads which imply higher or lower credit quality than the current third-party rating. Unrealized losses on investment grade securities are principally related to an increase in market yields which may include increased risk-free interest rates or wider credit spreads since the time of initial purchase. The unrealized losses are expected to reverse as the securities approach maturity. ABS and MBS in an unrealized loss position were evaluated based on actual and projected collateral losses relative to the securities’ positions in the respective securitization trusts, security specific expectations of cash flows, and credit ratings. This evaluation also takes into consideration credit enhancement, measured in terms of (i) subordination from other classes of securities in the trust that are contractually obligated to absorb losses before the class of security the Company owns, and (ii) the expected impact of other structural features embedded in the securitization trust beneficial to the class of securities the Company owns, such as overcollateralization and excess spread. Municipal bonds in an unrealized loss position were evaluated based on the underlying credit quality of the primary obligor, obligation type and quality of the underlying assets. As of December 31, 2020, the Company has not made the decision to sell and it is not more likely than not the Company will be required to sell fixed income securities with unrealized losses before recovery of the amortized cost basis. Loans The Company establishes a credit loss allowance for mortgage loans, agent loans and bank loans when they are originated or purchased, and for unfunded commitments unless they are unconditionally cancellable by the Company. The Company uses a probability of default and loss given default model for mortgage loans and bank loans to estimate current expected credit losses that considers all relevant information available including past events, current conditions, and reasonable and supportable forecasts over the life of an asset. The Company also considers such factors as historical losses, expected prepayments and various economic factors. For mortgage loans the Company considers origination vintage year and property level information such as debt service coverage, property type, property location and collateral value. For bank loans the Company considers the credit rating of the borrower, credit spreads and type of loan. After the reasonable and supportable forecast period, the Company’s model reverts to historical loss trends. Given the less complex and homogenous nature of agent loans, the Company estimates current expected credit losses using historical loss experience over the estimated life of the loans, adjusted for current conditions, reasonable and supportable forecasts and expected prepayments. Loans are evaluated on a pooled basis when they share similar risk characteristics. The Company monitors loans through a quarterly credit monitoring process to determine when they no longer share similar risk characteristics and are to be evaluated individually when estimating credit losses. Loans are written off against their corresponding allowances when there is no reasonable expectation of recovery. If a loan recovers after a write-off, the estimate of expected credit losses includes the expected recovery. Accrual of income is suspended for loans that are in default or when full and timely collection of principal and interest payments is not probable. Accrued income receivable is monitored for recoverability and when not expected to be collected is written off through net investment income. Cash receipts on loans on non-accrual status are generally recorded as a reduction of amortized cost. Accrued interest is excluded from the amortized cost of loans and is reported within the accrued investment income line of the Consolidated Statements of Financial Position. As of December 31, 2020, accrued interest totaled $13 million, $2 million and $1 million for mortgage loans, agent loans and bank loans, respectively. Mortgage loans When it is determined a mortgage loan shall be evaluated individually, the Company uses various methods to estimate credit losses on individual loans such as using collateral value less estimated costs to sell where applicable, including when foreclosure is probable or when repayment is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. When collateral value is used, the mortgage loans may not have a credit loss allowance when the fair value of the collateral exceeds the loan’s amortized cost. An alternative approach may be utilized to estimate credit losses using the present value of the loan’s expected future repayment cash flows discounted at the loan’s current effective interest rate. Individual loan credit loss allowances are adjusted for subsequent changes in the fair value of the collateral less costs to sell, when applicable, or present value of the loan’s expected future repayment cash flows. Debt service coverage ratio is considered a key credit quality indicator when mortgage loan credit loss allowances are estimated. Debt service coverage ratio represents the amount of estimated cash flow from the property available to the borrower to meet principal and interest payment obligations. Debt service coverage ratio estimates are updated annually or more frequently if conditions are warranted based on the Company’s credit monitoring process. The following table reflects mortgage loans amortized cost by debt service coverage ratio distribution and year of origination as of December 31.
____________ (1)Due to the adoption of the measurement of credit losses on financial instruments accounting standard, prior valuation allowance is now presented as an allowance for expected credit losses. Mortgage loans with a debt service coverage ratio below 1.0 that are not considered impaired primarily relate to situations where the borrower has the financial capacity to fund the revenue shortfalls from the properties for the foreseeable term, the decrease in cash flows from the properties is considered temporary, or there are other risk mitigating factors such as additional collateral, escrow balances or borrower guarantees. Payments on all mortgage loans were current as of December 31, 2020, 2019 and 2018. During the fourth quarter of 2020, the Company sold $217 million of mortgage loans, net of a $15 million credit loss allowance, resulting in a net realized capital loss of $4 million. The rollforward of credit loss allowance for mortgage loans for the years ended December 31 is as follows:
Agent loans The Company monitors agent loans to determine when they should be removed from the pool and assessed for credit losses individually by using internal credit risk grades that classify the loans into risk categories. The categorization is based on relevant information about the ability of borrowers to service their debt, such as historical payment experience, current business trends, cash flow coverage and collateral quality. Internal credit risk grades are updated annually or more frequently if conditions are warranted based on the Company’s credit monitoring process. As of December 31, 2020, 85% of agent loans balance represents the top three highest credit quality categories. The allowance for agent loans totaled $5 million as of December 31, 2020 and did not change from January 1, 2020. Bank loans When it is determined a bank loan shall be evaluated individually, the Company uses various methods to estimate credit losses on individual loans such as the present value of the loan’s expected future repayment cash flows discounted at the loan’s current effective interest rate. Credit ratings of the borrower are considered a key credit quality indicator when bank loan credit loss allowances are estimated. The ratings are updated quarterly and are either received from a nationally recognized rating agency or a comparable internal rating is derived if an externally provided rating is not available. The year of origination is determined to be the year in which the asset is acquired. The bank loans amortized cost by credit rating and year of origination as of December 31 is as follows:
The rollforward of credit loss allowance for bank loans for the years ended December 31 is as follows:
|
Fair Value of Assets and Liabilities |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Assets and liabilities recorded on the Consolidated Statements of Financial Position at fair value are categorized in the fair value hierarchy based on the observability of inputs to the valuation techniques as follows: Level 1: Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company can access. Level 2: Assets and liabilities whose values are based on the following: (a)Quoted prices for similar assets or liabilities in active markets; (b)Quoted prices for identical or similar assets or liabilities in markets that are not active; or (c)Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3: Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Unobservable inputs reflect the Company’s estimates of the assumptions that market participants would use in valuing the assets and liabilities. The availability of observable inputs varies by instrument. In situations where fair value is based on internally developed pricing models or inputs that are unobservable in the market, the determination of fair value requires more judgment. The degree of judgment exercised by the Company in determining fair value is typically greatest for instruments categorized in Level 3. In many instances, valuation inputs used to measure fair value fall into different levels of the fair value hierarchy. The category level in the fair value hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company uses prices and inputs that are current as of the measurement date, including during periods of market disruption. In periods of market disruption, the ability to observe prices and inputs may be reduced for many instruments. The Company is responsible for the determination of fair value and the supporting assumptions and methodologies. The Company gains assurance that assets and liabilities are appropriately valued through the execution of various processes and controls designed to ensure the overall reasonableness and consistent application of valuation methodologies, including inputs and assumptions, and compliance with accounting standards. For fair values received from third parties or internally estimated, the Company’s processes and controls are designed to ensure that the valuation methodologies are appropriate and consistently applied, the inputs and assumptions are reasonable and consistent with the objective of determining fair value, and the fair values are accurately recorded. For example, on a continuing basis, the Company assesses the reasonableness of individual fair values that have stale security prices or that exceed certain thresholds as compared to previous fair values received from valuation service providers or brokers or derived from internal models. The Company performs procedures to understand and assess the methodologies, processes and controls of valuation service providers. In addition, the Company may validate the reasonableness of fair values by comparing information obtained from valuation service providers or brokers to other third-party valuation sources for selected securities. The Company performs ongoing price validation procedures such as back-testing of actual sales, which corroborate the various inputs used in internal models to market observable data. When fair value determinations are expected to be more variable, the Company validates them through reviews by members of management who have relevant expertise and who are independent of those charged with executing investment transactions. The Company has two types of situations where investments are classified as Level 3 in the fair value hierarchy: (1) Specific inputs significant to the fair value estimation models are not market observable. This primarily occurs in the Company’s use of broker quotes to value certain securities where the inputs have not been corroborated to be market observable, and the use of valuation models that use significant non-market observable inputs. (2) Quotes continue to be received from independent third-party valuation service providers and all significant inputs are market observable; however, there has been a significant decrease in the volume and level of activity for the asset when compared to normal market activity such that the degree of market observability has declined to a point where categorization as a Level 3 measurement is considered appropriate. The indicators considered in determining whether a significant decrease in the volume and level of activity for a specific asset has occurred include the level of new issuances in the primary market, trading volume in the secondary market, the level of credit spreads over historical levels, applicable bid-ask spreads, and price consensus among market participants and other pricing sources. Certain assets are not carried at fair value on a recurring basis, including mortgage loans, bank loans, agent loans and policy loans, and these are only included in the fair value hierarchy disclosure when the individual investment is reported at fair value. In determining fair value, the Company principally uses the market approach which generally utilizes market transaction data for the same or similar instruments. To a lesser extent, the Company uses the income approach which involves determining fair values from discounted cash flow methodologies. For the majority of Level 2 and Level 3 valuations, a combination of the market and income approaches is used. Summary of significant inputs and valuation techniques for Level 2 and Level 3 assets and liabilities measured at fair value on a recurring basis Level 2 measurements •Fixed income securities: U.S. government and agencies, municipal, corporate - public and foreign government: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. Corporate - privately placed: Privately placed are valued using a discounted cash flow model that is widely accepted in the financial services industry and uses market observable inputs and inputs derived principally from, or corroborated by, observable market data. The primary inputs to the discounted cash flow model include an interest rate yield curve, as well as published credit spreads for similar assets in markets that are not active that incorporate the credit quality and industry sector of the issuer. Corporate - privately placed also includes redeemable preferred stock that are valued using quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, underlying stock prices and credit spreads. ABS and MBS: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, collateral performance and credit spreads. Certain ABS are valued based on non-binding broker quotes whose inputs have been corroborated to be market observable. ABS and residential MBS include prepayment speeds as a primary input for valuation. •Equity securities: The primary inputs to the valuation include quoted prices or quoted net asset values for identical or similar assets in markets that are not active. •Short-term: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. •Other investments: Free-standing exchange listed derivatives that are not actively traded are valued based on quoted prices for identical instruments in markets that are not active. Over-the-counter (“OTC”) derivatives, including interest rate swaps, foreign currency swaps, total return swaps, foreign exchange forward contracts, options and certain credit default swaps, are valued using models that rely on inputs such as interest rate yield curves, implied volatilities, index price levels, currency rates, and credit spreads that are observable for substantially the full term of the contract. The valuation techniques underlying the models are widely accepted in the financial services industry and do not involve significant judgment. Level 3 measurements •Fixed income securities: Municipal: Comprise municipal bonds that are not rated by third-party credit rating agencies. The primary inputs to the valuation of these municipal bonds include quoted prices for identical or similar assets in markets that exhibit less liquidity relative to those markets supporting Level 2 fair value measurements, contractual cash flows, benchmark yields and credit spreads. Also included are municipal bonds valued based on non-binding broker quotes where the inputs have not been corroborated to be market observable. Corporate - public and privately placed, ABS and MBS: Primarily valued based on non-binding broker quotes where the inputs have not been corroborated to be market observable. Other inputs for corporate fixed income securities include an interest rate yield curve, as well as published credit spreads for similar assets that incorporate the credit quality and industry sector of the issuer. •Equity securities: The primary inputs to the valuation include quoted prices or quoted net asset values for identical or similar assets in markets that exhibit less liquidity relative to those markets supporting Level 2 fair value measurements. •Other investments: Certain OTC derivatives, such as interest rate caps and certain credit default swaps, are valued using models that are widely accepted in the financial services industry. These are categorized as Level 3 as a result of the significance of non-market observable inputs such as volatility. Other primary inputs include interest rate yield curves and credit spreads. •Contractholder funds: Derivatives embedded in certain life and annuity contracts are valued internally using models widely accepted in the financial services industry that determine a single best estimate of fair value for the embedded derivatives within a block of contractholder liabilities. The models primarily use stochastically determined cash flows based on the contractual elements of embedded derivatives, projected option cost and applicable market data, such as interest rate yield curves and equity index volatility assumptions. These are categorized as Level 3 as a result of the significance of non-market observable inputs. Investments excluded from the fair value hierarchy Limited partnerships carried at fair value, which do not have readily determinable fair values, use NAV provided by the investees and are excluded from the fair value hierarchy. These investments are generally not redeemable by the investees and generally cannot be sold without approval of the general partner. The Company receives distributions of income and proceeds from the liquidation of the underlying assets of the investees, which usually takes place in years 4-9 of the typical contractual life of 10-12 years. As of December 31, 2020, the Company has commitments to invest $166 million in these limited partnership interests. The following table summarizes the Company’s assets and liabilities measured at fair value as of December 31, 2020.
The following table summarizes the Company’s assets and liabilities measured at fair value as of December 31, 2019.
The following table summarizes quantitative information about the significant unobservable inputs used in Level 3 fair value measurements.
The embedded derivatives are equity-indexed and forward starting options in certain life and annuity products that provide customers with interest crediting rates based on the performance of the S&P 500. If the projected option cost increased (decreased), it would result in a higher (lower) liability fair value. As of December 31, 2020 and 2019, Level 3 fair value measurements of fixed income securities total $153 million and $208 million, respectively, and include $24 million and $38 million, respectively, of securities valued based on non-binding broker quotes where the inputs have not been corroborated to be market observable. As the Company does not develop the Level 3 fair value unobservable inputs for these fixed income securities, they are not included in the table above. However, an increase (decrease) in credit spreads for fixed income securities valued based on non-binding broker quotes would result in a lower (higher) fair value. The following table presents the rollforward of Level 3 assets and liabilities held at fair value during the year ended December 31, 2020.
The following table presents the total Level 3 gains (losses) included in net income for the year ended December 31, 2020.
The following table presents the rollforward of Level 3 assets and liabilities held at fair value during the year ended December 31, 2019.
The following table presents the total Level 3 gains (losses) included in net income for the year ended December 31, 2019.
The following table presents the rollforward of Level 3 assets and liabilities held at fair value during the year ended December 31, 2018.
____________________ (1)Comprises $1 million of assets. The following table presents the total Level 3 gains (losses) included in net income for the year ended December 31, 2018.
Transfers into Level 3 during 2020, 2019 and 2018 included situations where a quote was not provided by the Company’s independent third-party valuation service provider and as a result the price was stale or had been replaced with a broker quote where the inputs had not been corroborated to be market observable resulting in the security being classified as Level 3. Transfers into Level 3 during 2020 also included derivatives embedded in equity-indexed universal life contracts related to reinsurance assumed from AAC. Transfers into Level 3 during 2019 also included derivatives embedded in equity-indexed universal life contracts due to refinements in the valuation modeling resulting in an increase in significance of non-market observable inputs. Transfers out of Level 3 during 2020, 2019 and 2018 included situations where a broker quote was used in the prior period and a quote became available from the Company’s independent third-party valuation service provider in the current period. A quote utilizing the new pricing source was not available as of the prior period, and any gains or losses related to the change in valuation source for individual securities were not significant. The table below provides valuation changes included in net income and OCI for Level 3 assets and liabilities held as of December 31.
___________________ (1)Effective January 1, 2020, the Company adopted the fair value accounting standard that prospectively requires the disclosure of valuation changes reported in OCI. Presented below are the carrying values and fair value estimates of financial instruments not carried at fair value.
____________________ (1)Represents the amounts reported on the Consolidated Statements of Financial Position.
|
Derivative Financial Instruments and Off-balance sheet Financial Instruments |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments and Off-balance sheet Financial Instruments | Derivative Financial Instruments and Off-balance sheet Financial InstrumentsThe Company uses derivatives for risk reduction and to increase investment portfolio returns through asset replication. Risk reduction activity is focused on managing the risks with certain assets and liabilities arising from the potential adverse impacts from changes in risk-free interest rates, changes in equity market valuations, increases in credit spreads and foreign currency fluctuations. Asset replication refers to the “synthetic” creation of assets through the use of derivatives. The Company replicates fixed income securities using a combination of a credit default swap, index total return swap, options, or a foreign currency forward contract and one or more highly rated fixed income securities, primarily investment grade host bonds, to synthetically replicate the economic characteristics of one or more cash market securities. The Company replicates equity securities using futures, index total return swaps and options to increase equity exposure. The Company utilizes several derivative strategies to manage risk. Asset-liability management is a risk management strategy that is principally employed to balance the respective interest-rate sensitivities of the Company’s assets and liabilities. Depending upon the attributes of the assets acquired and liabilities issued, derivative instruments such as interest rate swaps, caps, swaptions and futures are utilized to change the interest rate characteristics of existing assets and liabilities to ensure the relationship is maintained within specified ranges and to reduce exposure to rising or falling interest rates. Fixed income index total return swaps are used to offset valuation losses in the portfolio during periods of declining market values. Credit default swaps are typically used to mitigate the credit risk within the Company’s fixed income portfolio. Futures and options are used for hedging the equity exposure contained in the Company’s equity indexed life and annuity product contracts that offer equity returns to contractholders. In addition, the Company uses equity index total return swaps, options and futures to offset valuation losses in the equity portfolio during periods of declining equity market values. Foreign currency swaps and forwards are primarily used to reduce the foreign currency risk associated with holding foreign currency denominated investments. The Company also has derivatives embedded in non-derivative host contracts that are required to be separated from the host contracts and accounted for at fair value with changes in fair value of embedded derivatives reported in net income. The Company’s primary embedded derivatives are equity options in life and annuity product contracts, which provide returns linked to equity indices to contractholders. When derivatives meet specific criteria, they may be designated as accounting hedges and accounted for as fair value, cash flow, foreign currency fair value or foreign currency cash flow hedges. The Company designates certain investment risk transfer reinsurance agreements as fair value hedges when the hedging instrument is highly effective in offsetting the risk of changes in the fair value of the hedged item. The fair value of the hedged liability is reported in contractholder funds in the Consolidated Statements of Financial Position. The impact from results of the fair value hedge is reported in interest credited to contractholder funds in the Consolidated Statements of Operations and Comprehensive Income. The Company designates certain of its foreign currency swap contracts as cash flow hedges when the hedging instrument is highly effective in offsetting the exposure of variations in cash flows for the hedged risk that could affect net income. Amounts are reclassified to net investment income or realized capital gains and losses as the hedged item affects net income. The notional amounts specified in the contracts are used to calculate the exchange of contractual payments under the agreements and are generally not representative of the potential for gain or loss on these agreements. However, the notional amounts specified in credit default swaps where the Company has sold credit protection represent the maximum amount of potential loss, assuming no recoveries. Fair value, which is equal to the carrying value, is the estimated amount that the Company would receive or pay to terminate the derivative contracts at the reporting date. The carrying value amounts for OTC derivatives are further adjusted for the effects, if any, of enforceable master netting agreements and are presented on a net basis, by counterparty agreement, in the Consolidated Statements of Financial Position. For those derivatives which qualify and have been designated as fair value accounting hedges, net income includes the changes in the fair value of both the derivative instrument and the hedged risk. For cash flow hedges, gains and losses are amortized from AOCI and are reported in net income in the same period the forecasted transactions being hedged impact net income. Non-hedge accounting is generally used for “portfolio” level hedging strategies where the terms of the individual hedged items do not meet the strict homogeneity requirements to permit the application of hedge accounting. For non-hedge derivatives, net income includes changes in fair value and accrued periodic settlements, when applicable. With the exception of non-hedge derivatives used for asset replication and non-hedge embedded derivatives, all of the Company’s derivatives are evaluated for their ongoing effectiveness as either accounting hedge or non-hedge derivative financial instruments on at least a quarterly basis. Fair value hedges The Company had one derivative designated as a fair value hedge and had no foreign currency contracts designated as fair value hedges during 2020, 2019 and 2018. Cash flow hedges The Company had no derivatives designated as cash flow hedges during 2020 and 2019 and one foreign currency contract designated as a cash flow hedge during 2018. The following table provides a summary of the volume and fair value positions of derivative instruments as well as their reporting location in the Consolidated Statement of Financial Position as of December 31, 2020.
_________________________________________ (1) Volume for OTC and cleared derivative contracts is represented by their notional amounts. Volume for exchange traded derivatives is represented by the number of contracts, which is the basis on which they are traded. (n/a = not applicable) The following table provides a summary of the volume and fair value positions of derivative instruments as well as their reporting location in the Consolidated Statement of Financial Position as of December 31, 2019.
The following table provides gross and net amounts for the Company’s OTC derivatives, all of which are subject to enforceable master netting agreements.
The following table provides a summary of the impacts of the Company’s foreign currency contracts in cash flow hedging relationships for the years ended December 31.
The following tables present gains and losses from valuation and settlements reported on derivatives not designated as accounting hedging instruments in the Consolidated Statements of Operations and Comprehensive Income.
The Company manages its exposure to credit risk by utilizing highly rated counterparties, establishing risk control limits, executing legally enforceable master netting agreements (“MNAs”) and obtaining collateral where appropriate. The Company uses MNAs for OTC derivative transactions that permit either party to net payments due for transactions and collateral is either pledged or obtained when certain predetermined exposure limits are exceeded. As of December 31, 2020, counterparties pledged $3 million in collateral to the Company, and the Company pledged $6 million in cash and securities to counterparties which includes $5 million of collateral posted under MNAs for contracts containing credit-risk contingent provisions that are in a liability position. The Company has not incurred any losses on derivative financial instruments due to counterparty nonperformance. Other derivatives, including futures and certain option contracts, are traded on organized exchanges which require margin deposits and guarantee the execution of trades, thereby mitigating any potential credit risk. Counterparty credit exposure represents the Company’s potential loss if all of the counterparties concurrently fail to perform under the contractual terms of the contracts and all collateral, if any, becomes worthless. This exposure is measured by the fair value of OTC derivative contracts with a positive fair value at the reporting date reduced by the effect, if any, of legally enforceable master netting agreements. The following table summarizes the counterparty credit exposure as of December 31 by counterparty credit rating as it relates to the Company’s OTC derivatives.
_________________________ (1)Allstate uses the lower of S&P’s or Moody’s long-term debt issuer ratings. (2)Only OTC derivatives with a net positive fair value are included for each counterparty. For certain exchange traded and cleared derivatives, margin deposits are required as well as daily cash settlements of margin accounts. As of December 31, 2020, the Company pledged $6 million in the form of margin deposits. Market risk is the risk that the Company will incur losses due to adverse changes in market rates and prices. Market risk exists for all of the derivative financial instruments the Company currently holds, as these instruments may become less valuable due to adverse changes in market conditions. To limit this risk, the Company’s senior management has established risk control limits. In addition, changes in fair value of the derivative financial instruments that the Company uses for risk management purposes are generally offset by the change in the fair value or cash flows of the hedged risk component of the related assets, liabilities or forecasted transactions. Certain of the Company’s derivative instruments contain credit-risk-contingent cross-default provisions. Credit-risk-contingent cross-default provisions allow the counterparties to terminate the derivative agreement if the Company defaults by pre-determined threshold amounts on certain debt instruments. The following summarizes the fair value of derivative instruments with credit-risk-contingent features that are in a gross liability position, as well as the fair value of assets and collateral that are netted against the liability in accordance with provisions within legally enforceable MNAs.
Credit derivatives - selling protection A credit default swap (“CDS”) is a derivative instrument, representing an agreement between two parties to exchange the credit risk of a specified entity (or a group of entities), or an index based on the credit risk of a group of entities (all commonly referred to as the “reference entity” or a portfolio of “reference entities”), in return for a periodic premium. In selling protection, CDS are used to replicate fixed income securities and to complement the cash market when credit exposure to certain issuers is not available or when the derivative alternative is less expensive than the cash market alternative. CDS typically have a five-year term. The following table shows the CDS notional amounts by credit rating and fair value of protection sold.
In selling protection with CDS, the Company sells credit protection on an identified single name, a basket of names in a first-to-default (“FTD”) structure or credit derivative index (“CDX”) that is generally investment grade, and in return receives periodic premiums through expiration or termination of the agreement. With single name CDS, this premium or credit spread generally corresponds to the difference between the yield on the reference entity’s public fixed maturity cash instruments and swap rates at the time the agreement is executed. With a FTD basket, because of the additional credit risk inherent in a basket of named reference entities, the premium generally corresponds to a high proportion of the sum of the credit spreads of the names in the basket and the correlation between the names. CDX is utilized to take a position on multiple (generally 125) reference entities. Credit events are typically defined as bankruptcy, failure to pay, or restructuring, depending on the nature of the reference entities. If a credit event occurs, the Company settles with the counterparty, either through physical settlement or cash settlement. In a physical settlement, a reference asset is delivered by the buyer of protection to the Company, in exchange for cash payment at par, whereas in a cash settlement, the Company pays the difference between par and the prescribed value of the reference asset. When a credit event occurs in a single name or FTD basket (for FTD, the first credit event occurring for any one name in the basket), the contract terminates at the time of settlement. For CDX, the reference entity’s name incurring the credit event is removed from the index while the contract continues until expiration. The maximum payout on a CDS is the contract notional amount. A physical settlement may afford the Company with recovery rights as the new owner of the asset. The Company monitors risk associated with credit derivatives through individual name credit limits at both a credit derivative and a combined cash instrument/credit derivative level. The ratings of individual names for which protection has been sold are also monitored. Off-balance sheet financial instruments The contractual amounts of off-balance sheet financial instruments as of December 31 are as follows:
In the preceding table, the contractual amounts represent the amount at risk if the contract is fully drawn upon, the counterparty defaults and the value of any underlying security becomes worthless. Unless noted otherwise, the Company does not require collateral or other security to support off-balance sheet financial instruments with credit risk. Commitments to invest in limited partnership interests represent agreements to acquire new or additional participation in certain limited partnership investments. The Company enters into these agreements in the normal course of business. Because the investments in limited partnerships are not actively traded, it is not practical to estimate the fair value of these commitments. Private placement commitments represent commitments to purchase private placement debt and private equity securities at a future date. The Company enters into these agreements in the normal course of business. The fair value of the debt commitments generally cannot be estimated on the date the commitment is made as the terms and conditions of the underlying private placement securities are not yet final. Because the private equity securities are not actively traded, it is not practical to estimate fair value of the commitments. Other loan commitments are agreements to lend to a borrower provided there is no violation of any condition established in the contract. The Company enters into these agreements to commit to future loan fundings at predetermined interest rates. Unless unconditionally cancellable, the Company recognizes a credit loss allowance on such commitments. Commitments have either fixed or varying expiration dates or other termination clauses. The fair value of these commitments is insignificant.
|
Reserve for Life-Contingent Contract Benefits and Contractholder Funds |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserve for Life-Contingent Contract Benefits and Contractholder Funds | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserve for Life-Contingent Contract Benefits and Contractholder Funds | Reserve for Life-Contingent Contract Benefits and Contractholder Funds As of December 31, the reserve for life-contingent contract benefits consists of the following:
The following table highlights the key assumptions generally used in calculating the reserve for life-contingent contract benefits.
______________________ (1)In 2006, the Company disposed of substantially all of its variable annuity business through reinsurance agreements with The Prudential Insurance Company of America, a subsidiary of Prudential Financial, Inc. (collectively “Prudential”). In the third quarter of 2020, the premium deficiency evaluation of the Company’s immediate annuities with life contingencies resulted in a premium deficiency reserve of $226 million. The long-term investment yield assumption was lowered, which resulted in the prior sufficiency changing to a deficiency. The deficiency was recognized as an increase in the reserve for life contingent contract benefits. The original assumptions used to establish reserves were updated to reflect current assumptions, and the primary changes included mortality expectations, where annuitants are living longer than originally anticipated, and long-term investment yields. In 2019, the Company’s reviews concluded that no premium deficiency adjustments were necessary. To the extent that unrealized gains on fixed income securities would result in a premium deficiency had those gains actually been realized, an insurance reserves adjustment is recorded for certain immediate annuities with life contingencies. This liability is included in the reserve for life-contingent contract benefits with respect to this unrealized deficiency. The offset to this liability is recorded as a reduction of the unrealized net capital gains included in AOCI. This liability was $496 million and $126 million as of December 31, 2020 and 2019, respectively. As of December 31, contractholder funds consist of the following:
The following table highlights the key contract provisions relating to contractholder funds.
______________________ (1)In 2006, the Company disposed of substantially all of its variable annuity business through reinsurance agreements with Prudential. Contractholder funds activity for the years ended December 31 is as follows:
The Company offered various guarantees to variable annuity contractholders. In 2006, the Company disposed of substantially all of its variable annuity business through reinsurance agreements with Prudential. Liabilities for variable contract guarantees related to death benefits are included in the reserve for life-contingent contract benefits and the liabilities related to the income, withdrawal and accumulation benefits are included in contractholder funds. All liabilities for variable contract guarantees are reported on a gross basis on the balance sheet with a corresponding reinsurance recoverable asset for those contracts subject to reinsurance. Absent any contract provision wherein the Company guarantees either a minimum return or account value upon death, a specified contract anniversary date, partial withdrawal or annuitization, variable annuity and variable life insurance contractholders bear the investment risk that the separate accounts’ funds may not meet their stated investment objectives. The account balances of variable annuity contracts’ separate accounts with guarantees included $2.94 billion and $2.66 billion of equity, fixed income and balanced mutual funds and $238 million and $252 million of money market mutual funds as of December 31, 2020 and 2019, respectively. The table below presents information regarding the Company’s variable annuity contracts with guarantees. The Company’s variable annuity contracts may offer more than one type of guarantee in each contract; therefore, the sum of amounts listed exceeds the total account balances of variable annuity contracts’ separate accounts with guarantees.
____________ (1)Defined as the estimated current guaranteed minimum death benefit in excess of the current account balance as of the balance sheet date. (2)Defined as the estimated present value of the guaranteed minimum annuity payments in excess of the current account balance. (3)Defined as the estimated current guaranteed minimum withdrawal balance (initial deposit) in excess of the current account balance as of the balance sheet date. (4)Defined as the estimated present value of the guaranteed minimum accumulation balance in excess of the current account balance. The liability for death and income benefit guarantees is equal to a benefit ratio multiplied by the cumulative contract charges earned, plus accrued interest less contract excess guarantee benefit payments. The benefit ratio is calculated as the estimated present value of all expected contract excess guarantee benefits divided by the present value of all expected contract charges. The establishment of reserves for these guarantees requires the projection of future fund values, mortality, persistency and customer benefit utilization rates. These assumptions are periodically reviewed and updated. For guarantees related to death benefits, benefits represent the projected excess guaranteed minimum death benefit payments. For guarantees related to income benefits, benefits represent the present value of the minimum guaranteed annuitization benefits in excess of the projected account balance at the time of annuitization. Projected benefits and contract charges used in determining the liability for certain guarantees are developed using models and stochastic scenarios that are also used in the development of estimated expected gross profits. Underlying assumptions for the liability related to income benefits include assumed future annuitization elections based on factors such as the extent of benefit to the potential annuitant, eligibility conditions and the annuitant’s attained age. The liability for guarantees is re-evaluated periodically, and adjustments are made to the liability balance through a charge or credit to contract benefits. Guarantees related to the majority of withdrawal and accumulation benefits are considered to be derivative financial instruments; therefore, the liability for these benefits is established based on its fair value. The following table summarizes the liabilities for guarantees.
The following table summarizes reserves included in total liability balance for guarantees by type of benefit as of December 31.
|
Reinsurance |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance | ReinsuranceThe Company reinsures certain of its risks to other insurers primarily under yearly renewable term, coinsurance and modified coinsurance agreements. These agreements result in a passing of the agreed-upon percentage of risk to the reinsurer in exchange for negotiated reinsurance premium payments. Modified coinsurance is similar to coinsurance, except that the cash and investments that support the liability for contract benefits are not transferred to the assuming company and settlements are made on a net basis between the companies. For certain term life insurance policies issued prior to October 2009, the Company ceded up to 90% of the mortality risk depending on the year of policy issuance under coinsurance agreements to a pool of thirteen unaffiliated reinsurers. Effective October 2009, mortality risk on term business is ceded under yearly renewable term agreements under which the Company cedes mortality in excess of its retention, which is consistent with how the Company generally reinsures its permanent life insurance business. The following table summarizes those retention limits by period of policy issuance.
In addition, the Company has used reinsurance to effect the disposition of certain blocks of business. The Company had reinsurance recoverables of $1.28 billion and $1.29 billion as of December 31, 2020 and 2019, respectively, due from Prudential related to the disposal of substantially all of its variable annuity business that was effected through reinsurance agreements. The amounts ceded to Prudential for the years ended December 31 are as follows:
As of December 31, 2020 and 2019, the Company had reinsurance recoverables of $99 million and $112 million, respectively, due from subsidiaries of Citigroup (Triton Insurance and American Health and Life Insurance) and Scottish Re (U.S.), Inc. in connection with the disposition of substantially all of the direct response distribution business in 2003. As of December 31, 2020 and 2019, the Company had $66 million and $73 million, of reinsurance recoverables related to Scottish Re (U.S.), Inc. On December 14, 2018, the Delaware Insurance Commissioner placed Scottish Re (U.S.), Inc. under regulatory supervision. On March 6, 2019, the Chancery Court of the State of Delaware entered a Rehabilitation and Injunction Order (the “Rehabilitation Order”) in response to a petition filed by the Insurance Commissioner (the “Petition”). The Company joined in a joint motion filed on behalf of several affected parties asking the court to allow a specified amount of offsetting claim payments and losses against premiums remitted to Scottish Re (U.S.), Inc. The Company also filed a separate motion related to the reimbursement of claim payments where Scottish Re (U.S.), Inc. is also acting as administrator. The Court has not yet ruled on either of these motions. In the interim, the Company and several other affected parties have been permitted to exercise certain setoff rights while the parties address any potential disputes. On June 30, 2020, pursuant to the Petition, Scottish Re (U.S.), Inc. submitted a proposed Plan of Rehabilitation (“Plan”) for consideration by the Court. On November 2, 2020, the Court issued a Third Amended Order to Show Cause scheduling a hearing on the Petition and Plan for May 25, 2021. The Company continues to monitor Scottish Re (U.S.), Inc. for future developments and will reevaluate its allowance for expected credit losses as new information becomes available. The Company is the assuming reinsurer for Lincoln Benefit Life Company’s (“LBL’s”) life insurance business sold through the Allstate agency channel and LBL’s payout annuity business in force prior to the sale of LBL on April 1, 2014. Under the terms of the reinsurance agreement, the Company is required to have a trust with assets greater than or equal to the statutory reserves ceded by LBL to the Company, measured on a monthly basis. As of December 31, 2020, the trust held $6.29 billion of investments, which are reported in the Consolidated Statement of Financial Position. ALIC and its subsidiary ALNY are parties to a reinsurance treaty through which ALNY cedes reinvestment related risk on its structured settlement annuities to ALIC. The reinsurance treaty is eliminated in consolidation. In 2019, ALIC established a trust for the benefit of ALNY and will maintain it with assets equal to or greater than ALNY’s statutory-basis cession. As of December 31, 2020, the trust held $1.56 billion of investments, which are reported in the Consolidated Statement of Financial Position. As of December 31, 2020, the gross life insurance in force was $435.85 billion of which $63.70 billion was ceded to unaffiliated reinsurers. The effects of reinsurance on premiums and contract charges for the years ended December 31 are as follows:
The effects of reinsurance on contract benefits for the years ended December 31 are as follows:
The effects of reinsurance on interest credited to contractholder funds for the years ended December 31 are as follows:
Reinsurance recoverables, net of allowance, as of December 31 are summarized in the following table.
As of December 31, 2020 and 2019, approximately 94% and 78%, respectively, of the Company’s reinsurance recoverables are due from companies rated A- or better by S&P. The following table shows the rollforward of the credit loss allowance for reinsurance recoverables for the year ended December 31.
|
Deferred Policy Acquisition and Sales Inducement Costs |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Policy Acquisition and Sales Inducement Costs | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Policy Acquisition and Sales Inducement Costs | Deferred Policy Acquisition and Sales Inducement Costs Deferred policy acquisition costs for the years ended December 31 are as follows:
DSI activity, which primarily relates to fixed annuities and interest-sensitive life contracts, for the years ended December 31 was as follows:
|
Guarantees and Contingent Liabilities |
12 Months Ended |
---|---|
Dec. 31, 2020 | |
Guarantees [Abstract] | |
Guarantees and Contingent Liabilities | Guarantees and Contingent Liabilities Guaranty funds Under state insurance guaranty fund laws, insurers doing business in a state can be assessed, up to prescribed limits, for certain obligations of insolvent insurance companies to policyholders and claimants. Amounts assessed to each company are typically related to its proportion of business written in each state. The Company’s policy is to accrue assessments when the entity for which the insolvency relates has met its state of domicile’s statutory definition of insolvency and the amount of the loss is reasonably estimable. In most states, the definition is met with a declaration of financial insolvency by a court of competent jurisdiction. In certain states there must also be a final order of liquidation. Since most states allow a credit against premium or other state related taxes for assessments, an asset is recorded based on paid and accrued assessments for the amount the Company expects to recover on the respective state’s tax return and is realized over the period allocated by each state. As of both December 31, 2020 and 2019, the liability balance included in other liabilities and accrued expenses was $4 million. The related premium tax offsets included in other assets were $6 million as of both December 31, 2020 and 2019. Guarantees In the normal course of business, the Company provides standard indemnifications to contractual counterparties in connection with numerous transactions, including acquisitions and divestitures. The types of indemnifications typically provided include indemnifications for breaches of representations and warranties, taxes and certain other liabilities, such as third-party lawsuits. The indemnification clauses are often standard contractual terms and are entered into in the normal course of business based on an assessment that the risk of loss would be remote. The terms of the indemnifications vary in duration and nature. In many cases, the maximum obligation is not explicitly stated and the contingencies triggering the obligation to indemnify have not occurred and are not expected to occur. Consequently, the maximum amount of the obligation under such indemnifications is not determinable. Historically, the Company has not made any material payments pursuant to these obligations. The aggregate liability balance related to all guarantees was not material as of December 31, 2020. Regulation and compliance The Company is subject to extensive laws, regulations and regulatory actions. From time to time, regulatory authorities or legislative bodies seek to impose additional regulations regarding agent and broker compensation, regulate the nature of and amount of investments, impose fines and penalties for unintended errors or mistakes, impose additional regulations regarding cybersecurity and privacy, and otherwise expand overall regulation of insurance products and the insurance industry. In addition, the Company is subject to laws and regulations administered and enforced by federal agencies, international agencies, and other organizations, including but not limited to the Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the U.S. Department of Justice. The Company has established procedures and policies to facilitate compliance with laws and regulations, to foster prudent business operations, and to support financial reporting. The Company routinely reviews its practices to validate compliance with laws and regulations and with internal procedures and policies. As a result of these reviews, from time to time the Company may decide to modify some of its procedures and policies. Such modifications, and the reviews that led to them, may be accompanied by payments being made and costs being incurred. The ultimate changes and eventual effects of these actions on the Company’s business, if any, are uncertain.
|
Income Taxes |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes ALIC and its subsidiaries (the “Allstate Life Group”) join with the Corporation (the “Allstate Group”) in the filing of a consolidated federal income tax return and are party to a federal income tax allocation agreement (the “Allstate Tax Sharing Agreement”). Under the Allstate Tax Sharing Agreement, the Allstate Life Group pays to or receives from the Corporation the amount, if any, by which the Allstate Group’s federal income tax liability is affected by virtue of inclusion of the Allstate Life Group in the consolidated federal income tax return. Effectively, this results in the Allstate Life Group’s annual income tax provision being computed, with adjustments, as if the Allstate Life Group filed a separate return. Deferred income taxes result from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements that will result in taxable or deductible amounts in future years. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in years in which those temporary differences are expected to be recovered or settled. Deferred tax assets and liabilities are adjusted through income tax expense as changes in tax laws or rates are enacted. The Internal Revenue Service (“IRS”) has completed its exam of the Allstate Group’s 2013 through 2016 federal income tax returns. The 2017 and 2018 audit cycle is expected to begin in the first quarter of 2021. Any adjustments that may result from IRS examinations of the Allstate Group’s tax returns are not expected to have a material effect on the consolidated financial statements. The Company recognizes tax positions in the consolidated financial statements only when it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized on settlement. A liability is established for differences between positions taken in a tax return and amounts recognized in the consolidated financial statements. The Company had $12 million, $14 million and $14 million liability for unrecognized tax benefits as of December 31, 2020, 2019 and 2018, respectively. The change in the liability for unrecognized tax benefits in 2020 related to a decrease for settlements. The $12 million increase in the liability for unrecognized tax benefits in 2018 related to the increase for tax positions taken in the current year. The Company believes that the unrecognized tax benefits balance will not materially change within the next twelve months. The components of the deferred income tax assets and liabilities as of December 31 are as follows:
Although realization is not assured, management believes it is more likely than not that the deferred tax assets will be realized based on the Company’s assessment that the deductions ultimately recognized for tax purposes will be fully utilized. The components of income tax expense for the years ended December 31 are as follows:
The Company paid taxes of $30 million, $62 million and $30 million in 2020, 2019 and 2018, respectively. The Company had current income tax receivable of $35 million as of December 31, 2020 and current income tax payable of $29 million as of December 31, 2019. A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations for the years ended December 31 is as follows:
|
Capital Structure |
12 Months Ended |
---|---|
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Capital Structure | Capital Structure Debt outstanding All of the Company’s outstanding debt as of December 31, 2020 and 2019 relates to intercompany obligations. These obligations reflect notes due to related parties and are discussed in Note 4. The Company paid $7 million, $5 million and $5 million of interest on debt in 2020, 2019 and 2018, respectively. The Company had $85 million and $61 million of investment-related debt that is reported in other liabilities and accrued expenses as of December 31, 2020 and 2019, respectively.
|
Statutory Financial Information and Dividend Limitations |
12 Months Ended |
---|---|
Dec. 31, 2020 | |
Statutory Financial Information and Dividend Limitations | |
Statutory Financial Information and Dividend Limitations | Statutory Financial Information and Dividend Limitations ALIC and its insurance subsidiaries prepare their statutory-basis financial statements in conformity with accounting practices prescribed or permitted by the insurance department of the applicable state of domicile. Prescribed statutory accounting practices include a variety of publications of the National Association of Insurance Commissioners (“NAIC”), as well as state laws, regulations and general administrative rules. Permitted statutory accounting practices encompass all accounting practices not so prescribed. All states require domiciled insurance companies to prepare statutory-basis financial statements in conformity with the NAIC Accounting Practices and Procedures Manual, subject to any deviations prescribed or permitted by the applicable insurance commissioner or director. Statutory accounting practices differ from GAAP primarily since they require charging policy acquisition and certain sales inducement costs to expense as incurred, establishing life insurance reserves based on different actuarial assumptions, and valuing certain investments and establishing deferred taxes on a different basis. ALIC and its insurance subsidiaries had a statutory net loss of $125 million in 2020 and statutory net income of $363 million and $410 million in 2019 and 2018, respectively. Statutory capital and surplus was $3.93 billion and $3.81 billion as of December 31, 2020 and 2019, respectively. Dividend Limitations The ability of ALIC to pay dividends is dependent on business conditions, income, cash requirements and other relevant factors. The payment of shareholder dividends by ALIC to AIC without the prior approval of the Illinois Department of Insurance (“IL DOI”) is limited to formula amounts based on net income and capital and surplus, determined in conformity with statutory accounting practices, as well as the timing and amount of dividends paid in the preceding twelve months. The Company did not pay dividends in 2020. The maximum amount of dividends ALIC will be able to pay without prior IL DOI approval at a given point in time during 2021 is $393 million. The payment of a dividend in excess of this amount requires 30 days advance written notice to the IL DOI. The dividend is deemed approved, unless the IL DOI disapproves it within the 30 day notice period. Additionally, any dividend must be paid out of unassigned surplus excluding unrealized appreciation from investments, which for ALIC totaled $864 million as of December 31, 2020, and cannot result in capital and surplus being less than the minimum amount required by law. ALIC may receive dividends from time to time from its insurance subsidiaries. The ability of these insurance subsidiaries to pay dividends is generally dependent on business conditions, income, cash requirements, and other relevant factors. Insurance subsidiaries cannot pay dividends to ALIC without prior DOI approval at any given point during 2021. ALIC did not receive dividends from its insurance subsidiaries during 2020 or 2019. Under state insurance laws, insurance companies are required to maintain paid up capital of not less than the minimum capital requirement applicable to the types of insurance they are authorized to write. Insurance companies are also subject to risk-based capital (“RBC”) requirements adopted by state insurance regulators. A company’s “authorized control level RBC” is calculated using various factors applied to certain financial balances and activity. Companies that do not maintain adjusted statutory capital and surplus at a level in excess of the company action level RBC, which is two times authorized control level RBC, are required to take specified actions. Company action level RBC is significantly in excess of the minimum capital requirements. Total adjusted statutory capital and surplus and authorized control level RBC of ALIC were $4.44 billion and $622 million, respectively, as of December 31, 2020. ALIC’s insurance subsidiaries are included as a component of ALIC’s total statutory capital and surplus. Intercompany transactions Notification and approval of intercompany lending activities is also required by the IL DOI when ALIC does not have unassigned surplus and for transactions that exceed a level that is based on a formula using statutory admitted assets and statutory surplus.
|
Benefit Plans |
12 Months Ended |
---|---|
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
Benefit Plans | Benefit Plans Pension and other postretirement plans Defined benefit pension plans and other postretirement plans, sponsored by the Corporation, cover most full-time employees, certain part-time employees and employee-agents. Benefits under the pension plans are based upon the employee’s length of service and eligible annual compensation. The Corporation also provides a medical coverage subsidy for eligible employees hired before January 1, 2003, including their eligible dependents, when they retire. In September 2020, the Corporation announced it will eliminate the medical coverage subsidy effective January 1, 2021 for employees who are not eligible to retire as of December 31, 2020. The cost allocated to the Company for these plans was $2 million, $3 million and $2 million in 2020, 2019 and 2018, respectively. The Corporation has reserved the right to modify or terminate its benefit plans at any time and for any reason. Allstate 401(k) Savings Plan Employees of AIC are eligible to become members of the Allstate 401(k) Savings Plan (“Allstate Plan”). The Corporation’s contributions are based on the Corporation’s matching obligation. The cost allocated to the Company for the Allstate Plan was $4 million, $4 million and $5 million in 2020, 2019 and 2018, respectively.
|
Other Comprehensive Income |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive Income | Other Comprehensive Income The components of other comprehensive income (loss) on a pre-tax and after-tax basis for the years ended December 31 are as follows:
|
SCHEDULE I - SUMMARY OF INVESTMENTS OTHER THAN INVESTMENTS IN RELATED PARTIES |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SCHEDULE I - SUMMARY OF INVESTMENTS OTHER THAN INVESTMENTS IN RELATED PARTIES | SCHEDULE I - SUMMARY OF INVESTMENTS OTHER THAN INVESTMENTS IN RELATED PARTIES DECEMBER 31, 2020
|
SCHEDULE IV - REINSURANCE |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SCHEDULE IV - REINSURANCE | SCHEDULE IV - REINSURANCE
______________________________ (1)No reinsurance or coinsurance income was netted against premium ceded in 2020, 2019 or 2018.
|
SCHEDULE V - VALUATION ALLOWANCES AND QUALIFYING ACCOUNTS |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SCHEDULE V - VALUATION ALLOWANCES AND QUALIFYING ACCOUNTS | SCHEDULE V - VALUATION ALLOWANCES AND QUALIFYING ACCOUNTS
(1)Effective January 1, 2020, the Company adopted the measurement of credit losses on financial instruments accounting standard that primarily affected mortgage loans, bank loans and reinsurance recoverables.
|
Summary of Significant Accounting Policies (Policies) |
12 Months Ended |
---|---|
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying consolidated financial statements include the accounts of Allstate Life Insurance Company (“ALIC”) and its wholly owned subsidiaries (collectively referred to as the “Company”). ALIC is wholly owned by Allstate Insurance Company (“AIC”), which is wholly owned by Allstate Insurance Holdings, LLC, a wholly owned subsidiary of The Allstate Corporation (the “Corporation”). These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). All significant intercompany accounts and transactions have been eliminated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The Company operates as a single segment entity based on the manner in which the Company uses financial information to evaluate business performance and to determine the allocation of resources.
|
Investments | Investments Fixed income securities include bonds, asset-backed securities (“ABS”) and mortgage-backed securities (“MBS”). MBS includes residential and commercial mortgage-backed securities. Fixed income securities, which may be sold prior to their contractual maturity, are designated as available-for-sale (“AFS”) and are carried at fair value. The difference between amortized cost, net of credit loss allowances (“amortized cost, net”) and fair value, net of deferred income taxes and related deferred policy acquisition costs (“DAC”), deferred sales inducement costs (“DSI”) and reserves for life-contingent contract benefits, is reflected as a component of AOCI. The Company excludes accrued interest receivable from the amortized cost basis of its AFS fixed income securities. Cash received from calls and make-whole payments is reflected as a component of proceeds from sales and cash received from maturities and pay-downs is reflected as a component of investment collections within the Consolidated Statements of Cash Flows. Mortgage loans and loans reported in other investments (bank loans and agent loans) are carried at amortized cost, net, which represent the amount expected to be collected. The Company excludes accrued interest receivable from the amortized cost basis of its mortgage, bank and agent loans. Credit loss allowances are estimates of expected credit losses, established for loans upon origination or purchase, and are established considering all relevant information available, including past events, current conditions, and reasonable and supportable forecasts over the life of the loans. Loans are evaluated on a pooled basis when they share similar risk characteristics; otherwise, they are evaluated individually. Equity securities primarily include common stocks, exchange traded and mutual funds, non-redeemable preferred stocks and real estate investment trust equity investments. Certain exchange traded and mutual funds have fixed income securities as their underlying investments. Equity securities are carried at fair value. Equity securities without readily determinable or estimable fair values are measured using the measurement alternative, which is cost less impairment, if any, and adjustments resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. Investments in limited partnership interests are primarily accounted for in accordance with the equity method of accounting (“EMA”) and include interests in private equity funds, real estate funds and other funds. Investments in limited partnership interests purchased prior to January 1, 2018, where the Company’s interest is so minor that it exercises virtually no influence over operating and financial policies are accounted for at fair value primarily utilizing the net asset value (“NAV”) as a practical expedient to determine fair value. Short-term investments, including money market funds, commercial paper, U.S. Treasury bills and other short-term investments, are carried at fair value. Policy loans are carried at unpaid principal balances. Other investments primarily consist of bank loans, real estate, agent loans and derivatives. Bank loans are primarily senior secured corporate loans. Real estate is carried at cost less accumulated depreciation. Agent loans are loans issued to exclusive Allstate agents. Derivatives are carried at fair value. Investment income primarily consists of interest, dividends, income from limited partnership interests, rental income from real estate, and income from certain derivative transactions. Interest is recognized on an accrual basis using the effective yield method and dividends are recorded at the ex-dividend date. Interest income for ABS and MBS is determined considering estimated pay-downs, including prepayments, obtained from third-party data sources and internal estimates. Actual prepayment experience is periodically reviewed and effective yields are recalculated when differences arise between the prepayments originally anticipated and the actual prepayments received and currently anticipated. For ABS and MBS of high credit quality with fixed interest rates, the effective yield is recalculated on a retrospective basis. For all others, the effective yield is generally recalculated on a prospective basis. Net investment income for AFS fixed income securities includes the impact of accreting the credit loss allowance for the time value of money. Accrual of income is suspended for fixed income securities when the timing and amount of cash flows expected to be received is not reasonably estimable. Accrual of income is suspended for mortgage loans, bank loans and agent loans that are in default or when full and timely collection of principal and interest payments is not probable. Accrued income receivable is monitored for recoverability and when not expected to be collected is written off through net investment income. Cash receipts on investments on nonaccrual status are generally recorded as a reduction of amortized cost. Income from limited partnership interests carried at fair value is recognized based upon the changes in fair value of the investee’s equity primarily determined using NAV. Income from EMA limited partnership interests is recognized based on the Company’s share of the partnerships’ earnings. Income from EMA limited partnership interests is generally recognized on a three month delay due to the availability of the related financial statements from investees. Realized capital gains and losses include gains and losses on investment sales, changes in the credit loss allowances related to fixed income securities, mortgage loans, bank loans and agent loans, impairments, valuation changes of equity investments, including equity securities and certain limited partnerships where the underlying assets are predominately public equity securities, and periodic changes in fair value and settlements of certain derivatives including hedge ineffectiveness. Realized capital gains and losses on investment sales are determined on a specific identification basis and are net of credit losses already recognized through an allowance.
|
Derivative and embedded derivative financial instruments | Derivative and embedded derivative financial instruments Derivative financial instruments include interest rate swaps, credit default swaps, futures (interest rate and equity), options (including swaptions), interest rate caps, warrants, foreign currency swaps, foreign currency forwards, total return swaps and certain investment risk transfer reinsurance agreements. Derivatives required to be separated from the host instrument and accounted for as derivative financial instruments (“subject to bifurcation”) are embedded in equity-indexed life and annuity contracts and reinsured variable annuity contracts. All derivatives are accounted for on a fair value basis and reported as other investments, other assets, other liabilities and accrued expenses or contractholder funds. Embedded derivative instruments subject to bifurcation are also accounted for on a fair value basis and are reported together with the host contract. The change in fair value of derivatives embedded in life and annuity product contracts and subject to bifurcation is reported in contract benefits or interest credited to contractholder funds. Cash flows from embedded derivatives subject to bifurcation and derivatives receiving hedge accounting are reported consistently with the host contracts and hedged risks, respectively, within the Consolidated Statements of Cash Flows. Cash flows from other derivatives are reported in cash flows from investing activities within the Consolidated Statements of Cash Flows. When derivatives meet specific criteria, they may be designated as accounting hedges and accounted for as fair value, cash flow, foreign currency fair value or foreign currency cash flow hedges. The hedged item may be either all or a specific portion of a recognized asset, liability or an unrecognized firm commitment attributable to a particular risk for fair value hedges. At the inception of the hedge, the Company formally documents the hedging relationship and risk management objective and strategy. The documentation identifies the hedging instrument, the hedged item, the nature of the risk being hedged and the methodology used to assess the effectiveness of the hedging instrument in offsetting the exposure to changes in the hedged item’s fair value attributable to the hedged risk. For a cash flow hedge, this documentation includes the exposure to changes in the variability in cash flows attributable to the hedged risk. The Company does not exclude any component of the change in fair value of the hedging instrument from the effectiveness assessment. At each reporting date, the Company confirms that the hedging instrument continues to be highly effective in offsetting the hedged risk. Fair value hedges The change in fair value of hedging instruments used in fair value hedges of investment assets or a portion thereof is reported in net investment income, together with the change in fair value of the hedged items. The change in fair value of hedging instruments used in fair value hedges of contractholder funds liabilities or a portion thereof is reported in interest credited to contractholder funds, together with the change in fair value of the hedged items. Accrued periodic settlements on swaps are reported together with the changes in fair value of the related swaps in net investment income or interest credited to contractholder funds. The amortized cost, net for fixed income securities, the carrying value for mortgage loans or the carrying value of a designated hedged liability is adjusted for the change in fair value of the hedged risk. Cash flow hedges For hedging instruments used in cash flow hedges, the changes in fair value of the derivatives are reported in AOCI. Amounts are reclassified to net investment income or realized capital gains and losses as the hedged or forecasted transaction affects income. Accrued periodic settlements on derivatives used in cash flow hedges are reported in net investment income. The amount reported in AOCI for a hedged transaction is the cumulative gain or loss on the derivative instrument from inception of the hedge less gains or losses previously reclassified from AOCI into income. If the Company expects at any time that the loss reported in AOCI would lead to a net loss on the combination of the hedging instrument and the hedged transaction which may not be recoverable, a loss is recognized immediately in realized capital gains and losses. If an impairment loss is recognized on an asset or an additional obligation is incurred on a liability involved in a hedge transaction, any offsetting gain in AOCI is reclassified and reported together with the impairment loss or recognition of the obligation. Termination of hedge accounting If, subsequent to entering into a hedge transaction, the derivative becomes ineffective (including if the hedged item is sold or otherwise extinguished, the occurrence of a hedged forecasted transaction is no longer probable or the hedged asset has a credit loss), the Company may terminate the derivative position. The Company may also terminate derivative instruments or redesignate them as non-hedge as a result of other events or circumstances. If the derivative instrument is not terminated when a fair value hedge is no longer effective, the future gains and losses recognized on the derivative are reported in realized capital gains and losses. When a fair value hedge is no longer effective, is redesignated as non-hedge or when the derivative has been terminated, the fair value gain or loss on the hedged asset, liability or portion thereof previously recognized in income while the hedge was in place and used to adjust the amortized cost, net of hedged fixed income securities or mortgage loans or carrying value of a hedged liability, is amortized over the remaining life of the hedged asset, liability or portion thereof, and reflected in net investment income or interest credited to contractholder funds beginning in the period that hedge accounting is no longer applied. When a derivative instrument used in a cash flow hedge of an existing asset or liability is no longer effective or is terminated, the gain or loss recognized on the derivative is reclassified from AOCI to income as the hedged risk impacts income. If the derivative instrument is not terminated when a cash flow hedge is no longer effective, future gains and losses recognized on the derivative are reported in realized capital gains and losses. When a derivative instrument used in a cash flow hedge of a forecasted transaction is terminated because it is probable the forecasted transaction will not occur, the gain or loss recognized on the derivative is immediately reclassified from AOCI to realized capital gains and losses in the period that hedge accounting is no longer applied. Non-hedge derivative financial instruments For derivatives for which hedge accounting is not applied, the income statement effects, including fair value gains and losses and accrued periodic settlements, are reported either in realized capital gains and losses or in a single line item together with the results of the associated asset or liability for which risks are being managed.
|
Securities loaned | Securities loaned The Company’s business activities include securities lending transactions, which are used primarily to generate net investment income. The proceeds received in conjunction with securities lending transactions can be reinvested in short-term investments or fixed income securities. These transactions are short-term in nature, usually 30 days or less. The Company receives cash collateral for securities loaned in an amount generally equal to 102% and 105% of the fair value of domestic and foreign securities, respectively, and records the related obligations to return the collateral in other liabilities and accrued expenses. The carrying value of these obligations approximates fair value because of their relatively short-term nature. The Company monitors the market value of securities loaned on a daily basis and obtains additional collateral as necessary under the terms of the agreements to mitigate counterparty credit risk. The Company maintains the right and ability to repossess the securities loaned on short notice.
|
Recognition of premium revenues and contract charges, and related benefits and interest credited | Recognition of premium revenues and contract charges, and related benefits and interest credited Traditional life insurance products consist principally of products with fixed and guaranteed premiums and benefits, primarily term and whole life insurance products. Voluntary accident and health insurance products are expected to remain in force for an extended period and therefore are primarily classified as long-duration contracts. Premiums from these products are recognized as revenue when due from policyholders, net of any credit loss allowance for uncollectible premiums. Benefits are reflected in contract benefits and recognized over the life of the policy in relation to premiums. Immediate annuities with life contingencies, including certain structured settlement annuities, provide benefits over a period that extends beyond the period during which premiums are collected. Premiums from these products are recognized as revenue when received at the inception of the contract. Benefits are recognized in relation to premiums with the establishment of a reserve. The change in reserve over time is recorded in contract benefits and primarily relates to accumulation at the discount rate and annuitant mortality. Profits from these policies come primarily from investment income, which is recognized over the life of the contract. Interest-sensitive life contracts, such as universal life and single premium life, are insurance contracts whose terms are not fixed and guaranteed. The terms that may be changed include premiums paid by the contractholder, interest credited to the contractholder account balance and contract charges assessed against the contractholder account balance. Premiums from these contracts are reported as contractholder fund deposits. Contract charges consist of fees assessed against the contractholder account balance for the cost of insurance (mortality risk), contract administration and surrender of the contract prior to contractually specified dates. These contract charges are recognized as revenue when assessed against the contractholder account balance. Contract benefits include life-contingent benefit payments in excess of the contractholder account balance. Contracts that do not subject the Company to significant risk arising from mortality or morbidity are referred to as investment contracts. Fixed annuities, including market value adjusted annuities, equity-indexed annuities and immediate annuities without life contingencies, are considered investment contracts. Consideration received for such contracts is reported as contractholder fund deposits. Contract charges for investment contracts consist of fees assessed against the contractholder account balance for maintenance, administration and surrender of the contract prior to contractually specified dates, and are recognized when assessed against the contractholder account balance. Interest credited to contractholder funds represents interest accrued or paid on interest-sensitive life and investment contracts. Crediting rates for certain fixed annuities and interest-sensitive life contracts are adjusted periodically by the Company to reflect current market conditions subject to contractually guaranteed minimum rates. Crediting rates for indexed life and annuities are generally based on a specified interest rate index or an equity index, such as the Standard & Poor’s 500 Index (“S&P 500”). Interest credited also includes amortization of DSI expenses. DSI is amortized into interest credited using the same method used to amortize DAC. Contract charges for variable life and variable annuity products consist of fees assessed against the contractholder account balances for contract maintenance, administration, mortality, expense and surrender of the contract prior to contractually specified dates. Contract benefits incurred for variable annuity products include guaranteed minimum death, income, withdrawal and accumulation benefits. Substantially all of the Company’s variable annuity business is ceded through reinsurance agreements and the contract charges and contract benefits related thereto are reported net of reinsurance ceded.
|
Other revenue | Other revenue Other revenue represents gross dealer concessions received in connection with sales of non-proprietary products by Allstate exclusive agents and exclusive financial specialists. Other revenue is recognized when performance obligations are fulfilled.
|
Deferred policy acquisition and sales inducement costs | Deferred policy acquisition and sales inducement costs Costs that are related directly to the successful acquisition of new or renewal life insurance policies and investment contracts are deferred and recorded as DAC. These costs are principally agent and broker remuneration and certain underwriting expenses. DSI costs, which are deferred and recorded as other assets, relate to sales inducements offered on sales to new customers, principally on fixed annuity and interest-sensitive life contracts. These sales inducements are primarily in the form of additional credits to the customer’s account balance or enhancements to interest credited for a specified period which are in excess of the rates currently being credited to similar contracts without sales inducements. All other acquisition costs are expensed as incurred and included in operating costs and expenses. Amortization of DAC is included in amortization of deferred policy acquisition costs and is described in more detail below. DSI is amortized into income using the same methodology and assumptions as DAC and is included in interest credited to contractholder funds. For traditional life and voluntary accident and health insurance, DAC is amortized over the premium paying period of the related policies in proportion to the estimated revenues on such business. Assumptions used in the amortization of DAC and reserve calculations are established at the time the policy is issued and are generally not revised during the life of the policy. Any deviations from projected business in force resulting from actual policy terminations differing from expected levels and any estimated premium deficiencies may result in a change to the rate of amortization in the period such events occur. Generally, the amortization periods for these policies approximates the estimated lives of the policies. The Company periodically reviews the recoverability of DAC using actual experience and current assumptions. Traditional life insurance products, immediate annuities with life contingencies, and voluntary accident and health insurance products are reviewed individually. If actual experience and current assumptions are adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required for any remaining deficiency. For interest-sensitive life insurance and fixed annuities, DAC and DSI are amortized in proportion to the incidence of the total present value of gross profits, which includes both actual historical gross profits (“AGP”) and estimated future gross profits (“EGP”) expected to be earned over the estimated lives of the contracts. The amortization is net of interest on the prior period DAC balance using rates established at the inception of the contracts. Actual amortization periods generally range from 15-30 years; however, incorporating estimates of the rate of customer surrenders, partial withdrawals and deaths generally results in the majority of the DAC being amortized during the surrender charge period, which is typically 10-20 years for interest-sensitive life and 5-10 years for fixed annuities. The rate of DAC and DSI amortization is reestimated and adjusted by a cumulative charge or credit to income when there is a difference between the incidence of actual versus expected gross profits in a reporting period or when there is a change in total EGP. When DAC or DSI amortization or a component of gross profits for a quarterly period is potentially negative (which would result in an increase of the DAC or DSI balance) as a result of negative AGP, the specific facts and circumstances surrounding the potential negative amortization are considered to determine whether it is appropriate for recognition in the consolidated financial statements. Negative amortization is only recorded when the increased DAC or DSI balance is determined to be recoverable based on facts and circumstances. Recapitalization of DAC and DSI is limited to the originally deferred costs plus interest. AGP and EGP primarily consist of the following components: contract charges for the cost of insurance less mortality costs and other benefits; investment income and realized capital gains and losses less interest credited; and surrender and other contract charges less maintenance expenses. The principal assumptions for determining the amount of EGP are mortality, persistency, expenses, investment returns, including capital gains and losses on assets supporting contract liabilities, interest crediting rates to contractholders, and the effects of any hedges. For products whose supporting investments are exposed to capital losses in excess of the Company’s expectations which may cause periodic AGP to become temporarily negative, EGP and AGP utilized in DAC and DSI amortization may be modified to exclude the excess capital losses. The Company performs quarterly reviews of DAC and DSI recoverability for interest-sensitive life and fixed annuity contracts using current assumptions. If a change in the amount of EGP is significant, it could result in the unamortized DAC or DSI not being recoverable, resulting in a charge which is included as a component of amortization of deferred policy acquisition costs or interest credited to contractholder funds, respectively. The DAC and DSI balances presented include adjustments to reflect the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized capital gains or losses in the respective product investment portfolios were actually realized. The adjustments are recorded net of tax in AOCI. DAC, DSI and deferred income taxes determined on unrealized capital gains and losses and reported in AOCI recognize the impact on shareholder’s equity consistently with the amounts that would be recognized in the income statement on realized capital gains and losses. Customers of the Company may exchange one insurance policy or investment contract for another offered by the Company, or make modifications to an existing investment or life contract issued by the Company. These transactions are identified as internal replacements for accounting purposes. Internal replacement transactions determined to result in replacement contracts that are substantially unchanged from the replaced contracts are accounted for as continuations of the replaced contracts. Unamortized DAC and DSI related to the replaced contracts continue to be deferred and amortized in connection with the replacement contracts. For interest-sensitive life and investment contracts, the EGP of the replacement contracts are treated as a revision to the EGP of the replaced contracts in the determination of amortization of DAC and DSI. For traditional life insurance policies, any changes to unamortized DAC that result from replacement contracts are treated as prospective revisions. Any costs associated with the issuance of replacement contracts are characterized as maintenance costs and expensed as incurred. Internal replacement transactions determined to result in a substantial change to the replaced contracts are accounted for as an extinguishment of the replaced contracts, and any unamortized DAC and DSI related to the replaced contracts are eliminated with a corresponding charge to amortization of deferred policy acquisition costs or interest credited to contractholder funds, respectively.The costs assigned to the right to receive future cash flows from certain business purchased from other insurers are also classified as DAC in the Consolidated Statements of Financial Position. The costs capitalized represent the present value of future profits expected to be earned over the lives of the contracts acquired. These costs are amortized as profits emerge over the lives of the acquired business and are periodically evaluated for recoverability.
|
Reinsurance | Reinsurance In the normal course of business, the Company seeks to limit aggregate and single exposure to losses on large risks by purchasing reinsurance. The Company has also used reinsurance to effect the disposition of certain blocks of business. The amounts reported as reinsurance recoverables include amounts billed to reinsurers on losses paid as well as estimates of amounts expected to be recovered from reinsurers on insurance reserves and contractholder funds that have not yet been paid. Reinsurance recoverables on unpaid losses are estimated based upon assumptions consistent with those used in establishing the liabilities related to the underlying reinsured contracts. Insurance reserves are reported gross of reinsurance recoverables. Reinsurance premiums are generally reflected in income in a manner consistent with the recognition of premiums on the reinsured contracts. Reinsurance does not extinguish the Company’s primary liability under the policies written. Therefore, the Company evaluates reinsurer counterparty credit risk and records reinsurance recoverables net of credit loss allowances. The Company assesses counterparty credit risk for individual reinsurers separately when more relevant or on a pooled basis when shared risk characteristics exist. The evaluation considers the credit quality of the reinsurer and the period over which the recoverable balances are expected to be collected. The Company considers factors including past events, current conditions and reasonable and supportable forecasts in the development of the estimate of credit loss allowances. The Company uses a probability of default and loss given default model developed independently of the Company to estimate current expected credit losses. The model utilizes factors including historical industry factors based on the probability of liquidation, and incorporates current loss given default factors reflective of the industry. The Company monitors the credit ratings of reinsurer counterparties and evaluates the circumstances surrounding credit rating changes as inputs into its credit loss assessments. Uncollectible reinsurance recoverable balances are written off against the allowances when there is no reasonable expectation of recovery. The changes in the allowance are reported in contract benefits.
|
Income taxes | Income taxes Income taxes are accounted for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax bases of assets and liabilities at the enacted tax rates. The principal assets and liabilities giving rise to such differences are insurance reserves, investments (including unrealized capital gains and losses) and DAC. A deferred tax asset valuation allowance is established when it is more likely than not such assets will not be realized. The Company recognizes interest expense related to income tax matters in income tax expense and penalties in operating costs and expenses.
|
Reserve for life-contingent contract benefits | Reserve for life-contingent contract benefits The reserve for life-contingent contract benefits payable under insurance policies, including traditional life insurance, life-contingent immediate annuities and voluntary accident and health insurance products, is computed on the basis of long-term actuarial assumptions of future investment yields, mortality, morbidity, policy terminations and expenses. These assumptions, which for traditional life insurance are applied using the net level premium method, include provisions for adverse deviation and generally vary by characteristics such as type of coverage, year of issue and policy duration. The assumptions are established at the time the policy is issued and are generally not changed during the life of the policy. The Company periodically reviews the adequacy of reserves using actual experience and current assumptions. If actual experience and current assumptions are adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required for any remaining deficiency. Traditional life insurance products, immediate annuities with life contingencies, and voluntary accident and health insurance are reviewed individually. The Company also reviews these policies for circumstances where projected profits would be recognized in early years followed by projected losses in later years. If this circumstance exists, the Company will accrue a liability, during the period of profits, to offset the losses at such time as the future losses are expected to commence using a method updated prospectively over time. To the extent that unrealized gains on fixed income securities would result in a premium deficiency if those gains were realized, the related increase in reserves for certain immediate annuities with life contingencies is recorded net of tax as a reduction of unrealized net capital gains included in AOCI.
|
Contractholder funds | Contractholder funds Contractholder funds represent interest-bearing liabilities arising from the sale of products such as interest-sensitive life insurance and fixed annuities. Contractholder funds primarily comprise cumulative deposits received and interest credited to the contractholder less cumulative contract benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses. Contractholder funds also include reserves for secondary guarantees on interest-sensitive life insurance and certain fixed annuity contracts and reserves for certain guarantees on reinsured variable annuity contracts.
|
Separate accounts | Separate accounts Separate accounts assets are carried at fair value. The assets of the separate accounts are legally segregated and available only to settle separate accounts contract obligations. Separate accounts liabilities represent the contractholders’ claims to the related assets and are carried at an amount equal to the separate accounts assets. Investment income and realized capital gains and losses of the separate accounts accrue directly to the contractholders and therefore are not included in the Company’s Consolidated Statements of Operations and Comprehensive Income. Deposits to and surrenders and withdrawals from the separate accounts are reflected in separate accounts liabilities and are not included in consolidated cash flows. Absent any contract provision wherein the Company provides a guarantee, variable annuity and variable life insurance contractholders bear the investment risk that the separate accounts’ funds may not meet their stated investment objectives. Substantially all of the Company’s variable annuity business was reinsured beginning in 2006.
|
Measurement of credit losses | Measurement of credit losses The Company carries an allowance for expected credit losses for all financial assets measured at amortized cost on the Consolidated Statements of Financial Position. The Company considers past events, current conditions and reasonable and supportable forecasts in estimating an allowance for credit losses. The Company also carries a credit loss allowance for fixed income securities where applicable and, when amortized cost is reported, it is net of credit loss allowances. For additional information, refer to the Investments or Reinsurance topics of this section. The Company also estimates a credit loss allowance for commitments to fund mortgage loans, bank loans and agent loans unless they are unconditionally cancellable by the Company. The related allowance is reported in other liabilities and accrued expenses.
|
Off-balance sheet financial instruments | Off-balance sheet financial instruments Commitments to invest, commitments to purchase private placement securities, commitments to fund loans, financial guarantees and credit guarantees have off-balance sheet risk because their contractual amounts are not recorded in the Company’s Consolidated Statements of Financial Position (see Note 7 and Note 11).
|
Consolidation of variable interest entities | Consolidation of variable interest entities (“VIEs”) The Company consolidates VIEs when it is the primary beneficiary. A primary beneficiary is the variable interest holder in a VIE with both the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and the obligation to absorb losses, or the right to receive benefits, that could potentially be significant to the VIE.
|
Adopted accounting standard and Pending accounting standard | Adopted accounting standard Measurement of Credit Losses on Financial Instruments Effective January 1, 2020 the Company adopted new Financial Accounting Standards Board (“FASB”) guidance related to the measurement of credit losses on financial instruments that primarily affected mortgage loans, bank loans and reinsurance recoverables. Upon adoption of the guidance, the Company recorded a total allowance for expected credit losses of $79 million, pre-tax. After consideration of existing valuation allowances maintained prior to adopting the new guidance, the Company increased its valuation allowances for credit losses to conform to the new requirements which resulted in recognizing a cumulative effect decrease in retained income of $49 million, after-tax, at the date of adoption. The measurement of credit losses for AFS fixed income securities measured at fair value is not affected except that credit losses recognized are limited to the amount by which fair value is below amortized cost and the credit loss adjustment is recognized through a valuation allowance which may change over time but once recorded cannot subsequently be reduced to an amount below zero. Previously these credit loss adjustments were recorded as other-than-temporary impairments and were not reversed once recorded. Pending accounting standards Accounting for Long-Duration Insurance Contracts In August 2018, the FASB issued guidance revising the accounting for certain long-duration insurance contracts. The new guidance introduces material changes to the measurement of the Company’s reserves for traditional life, life-contingent immediate annuities and certain voluntary accident and health insurance products. Under the new guidance, measurement assumptions, including those for mortality, morbidity and policy terminations, will be required to be reviewed and updated at least annually. The effect of updating measurement assumptions other than the discount rate are required to be measured on a retrospective basis and reported in net income. In addition, reserves under the new guidance are required to be discounted using an upper-medium grade fixed income instrument yield that is updated through other comprehensive income at each reporting date. Current GAAP requires the measurement of reserves to utilize assumptions set at policy issuance unless updated current assumptions indicate that recorded reserves are deficient. The new guidance also requires DAC and other capitalized balances currently amortized in proportion to premiums or gross profits to be amortized on a constant level basis over the expected term for all long-duration insurance contracts. DAC will not be subject to loss recognition testing but will be reduced when actual lapse experience exceeds expected experience. The new guidance will no longer require adjustments to DAC and DSI related to unrealized gains and losses on investment securities supporting the related business. All market risk benefit product features will be measured at fair value with changes in fair value recorded in net income with the exception of changes in the fair value attributable to changes in the reporting entity’s own credit risk, which are required to be recognized in OCI. Substantially all of the Company’s market risk benefits relate to variable annuities that are reinsured, and therefore these impacts are not expected to be material to the Company. The new guidance is effective for financial statements issued for reporting periods beginning after December 15, 2022 and restatement of prior periods presented is required. Early adoption is permitted and if elected, restatement of only one prior period is required. The new guidance will be applied to affected contracts and DAC on the basis of existing carrying amounts at the earliest period presented or retrospectively using actual historical experience as of contract inception. The new guidance for market risk benefits is required to be adopted retrospectively. The Company is evaluating the anticipated impacts of applying the new guidance to both retained income and AOCI. The requirements of the new guidance represent a material change from existing GAAP, however, the underlying economics of the business and related cash flows are unchanged. The Company anticipates the financial statement impact of adopting the new guidance to be material, largely attributed to the impact of transitioning to a discount rate based on an upper-medium grade fixed income investment yield. The Company expects the most significant impacts will occur in the run-off annuity business. The revised accounting for DAC will be applied prospectively using the new model and any DAC effects existing in AOCI as a result of applying existing GAAP at the date of adoption will be eliminated. Simplifications to the Accounting for Income Taxes In December 2019, the FASB issued amendments to simplify the accounting for income taxes. The amendments eliminate certain exceptions in the existing guidance including those related to intraperiod tax allocation and deferred tax liability recognition when a subsidiary meets the criteria to apply the equity method of accounting. The amendments require recognition of the effect of an enacted change in tax laws or rates in the period that includes the enactment date, provide an option to not allocate taxes to a legal entity that is not subject to tax as well as other minor changes. The amendments are effective for reporting periods beginning after December 15, 2020. The new guidance specifies which amendments should be applied prospectively, retrospectively or on a modified retrospective basis through a cumulative-effect adjustment to retained income as of the beginning of the year of adoption. The impact of adoption is not expected to be material to the Company’s results of operations or financial position.
|
Fair value measurement | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Assets and liabilities recorded on the Consolidated Statements of Financial Position at fair value are categorized in the fair value hierarchy based on the observability of inputs to the valuation techniques as follows: Level 1: Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company can access. Level 2: Assets and liabilities whose values are based on the following: (a)Quoted prices for similar assets or liabilities in active markets; (b)Quoted prices for identical or similar assets or liabilities in markets that are not active; or (c)Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3: Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Unobservable inputs reflect the Company’s estimates of the assumptions that market participants would use in valuing the assets and liabilities. The availability of observable inputs varies by instrument. In situations where fair value is based on internally developed pricing models or inputs that are unobservable in the market, the determination of fair value requires more judgment. The degree of judgment exercised by the Company in determining fair value is typically greatest for instruments categorized in Level 3. In many instances, valuation inputs used to measure fair value fall into different levels of the fair value hierarchy. The category level in the fair value hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company uses prices and inputs that are current as of the measurement date, including during periods of market disruption. In periods of market disruption, the ability to observe prices and inputs may be reduced for many instruments. The Company is responsible for the determination of fair value and the supporting assumptions and methodologies. The Company gains assurance that assets and liabilities are appropriately valued through the execution of various processes and controls designed to ensure the overall reasonableness and consistent application of valuation methodologies, including inputs and assumptions, and compliance with accounting standards. For fair values received from third parties or internally estimated, the Company’s processes and controls are designed to ensure that the valuation methodologies are appropriate and consistently applied, the inputs and assumptions are reasonable and consistent with the objective of determining fair value, and the fair values are accurately recorded. For example, on a continuing basis, the Company assesses the reasonableness of individual fair values that have stale security prices or that exceed certain thresholds as compared to previous fair values received from valuation service providers or brokers or derived from internal models. The Company performs procedures to understand and assess the methodologies, processes and controls of valuation service providers. In addition, the Company may validate the reasonableness of fair values by comparing information obtained from valuation service providers or brokers to other third-party valuation sources for selected securities. The Company performs ongoing price validation procedures such as back-testing of actual sales, which corroborate the various inputs used in internal models to market observable data. When fair value determinations are expected to be more variable, the Company validates them through reviews by members of management who have relevant expertise and who are independent of those charged with executing investment transactions. The Company has two types of situations where investments are classified as Level 3 in the fair value hierarchy: (1) Specific inputs significant to the fair value estimation models are not market observable. This primarily occurs in the Company’s use of broker quotes to value certain securities where the inputs have not been corroborated to be market observable, and the use of valuation models that use significant non-market observable inputs. (2) Quotes continue to be received from independent third-party valuation service providers and all significant inputs are market observable; however, there has been a significant decrease in the volume and level of activity for the asset when compared to normal market activity such that the degree of market observability has declined to a point where categorization as a Level 3 measurement is considered appropriate. The indicators considered in determining whether a significant decrease in the volume and level of activity for a specific asset has occurred include the level of new issuances in the primary market, trading volume in the secondary market, the level of credit spreads over historical levels, applicable bid-ask spreads, and price consensus among market participants and other pricing sources. Certain assets are not carried at fair value on a recurring basis, including mortgage loans, bank loans, agent loans and policy loans, and these are only included in the fair value hierarchy disclosure when the individual investment is reported at fair value. In determining fair value, the Company principally uses the market approach which generally utilizes market transaction data for the same or similar instruments. To a lesser extent, the Company uses the income approach which involves determining fair values from discounted cash flow methodologies. For the majority of Level 2 and Level 3 valuations, a combination of the market and income approaches is used. Summary of significant inputs and valuation techniques for Level 2 and Level 3 assets and liabilities measured at fair value on a recurring basis Level 2 measurements •Fixed income securities: U.S. government and agencies, municipal, corporate - public and foreign government: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. Corporate - privately placed: Privately placed are valued using a discounted cash flow model that is widely accepted in the financial services industry and uses market observable inputs and inputs derived principally from, or corroborated by, observable market data. The primary inputs to the discounted cash flow model include an interest rate yield curve, as well as published credit spreads for similar assets in markets that are not active that incorporate the credit quality and industry sector of the issuer. Corporate - privately placed also includes redeemable preferred stock that are valued using quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, underlying stock prices and credit spreads. ABS and MBS: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, collateral performance and credit spreads. Certain ABS are valued based on non-binding broker quotes whose inputs have been corroborated to be market observable. ABS and residential MBS include prepayment speeds as a primary input for valuation. •Equity securities: The primary inputs to the valuation include quoted prices or quoted net asset values for identical or similar assets in markets that are not active. •Short-term: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. •Other investments: Free-standing exchange listed derivatives that are not actively traded are valued based on quoted prices for identical instruments in markets that are not active. Over-the-counter (“OTC”) derivatives, including interest rate swaps, foreign currency swaps, total return swaps, foreign exchange forward contracts, options and certain credit default swaps, are valued using models that rely on inputs such as interest rate yield curves, implied volatilities, index price levels, currency rates, and credit spreads that are observable for substantially the full term of the contract. The valuation techniques underlying the models are widely accepted in the financial services industry and do not involve significant judgment. Level 3 measurements •Fixed income securities: Municipal: Comprise municipal bonds that are not rated by third-party credit rating agencies. The primary inputs to the valuation of these municipal bonds include quoted prices for identical or similar assets in markets that exhibit less liquidity relative to those markets supporting Level 2 fair value measurements, contractual cash flows, benchmark yields and credit spreads. Also included are municipal bonds valued based on non-binding broker quotes where the inputs have not been corroborated to be market observable. Corporate - public and privately placed, ABS and MBS: Primarily valued based on non-binding broker quotes where the inputs have not been corroborated to be market observable. Other inputs for corporate fixed income securities include an interest rate yield curve, as well as published credit spreads for similar assets that incorporate the credit quality and industry sector of the issuer. •Equity securities: The primary inputs to the valuation include quoted prices or quoted net asset values for identical or similar assets in markets that exhibit less liquidity relative to those markets supporting Level 2 fair value measurements. •Other investments: Certain OTC derivatives, such as interest rate caps and certain credit default swaps, are valued using models that are widely accepted in the financial services industry. These are categorized as Level 3 as a result of the significance of non-market observable inputs such as volatility. Other primary inputs include interest rate yield curves and credit spreads. •Contractholder funds: Derivatives embedded in certain life and annuity contracts are valued internally using models widely accepted in the financial services industry that determine a single best estimate of fair value for the embedded derivatives within a block of contractholder liabilities. The models primarily use stochastically determined cash flows based on the contractual elements of embedded derivatives, projected option cost and applicable market data, such as interest rate yield curves and equity index volatility assumptions. These are categorized as Level 3 as a result of the significance of non-market observable inputs.
|
General (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of premiums and contract charges by product | The following table summarizes premiums and contract charges by product.
|
Summary of Significant Accounting Policies (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of allowance for credit loss | The Company’s allowance for credit losses is presented in the following table.
Rollforward of credit loss allowance for fixed income securities for the year ended December 31, 2020 is as follows:
____________ (1)Allowance for fixed income securities as of December 31, 2020 comprised $1 million of ABS. The rollforward of credit loss allowance for bank loans for the years ended December 31 is as follows:
|
Supplemental Cash Flow Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of supplemental cash flow information from collateralized securities received | The accompanying cash flows are included in cash flows from operating activities in the Consolidated Statements of Cash Flows along with the activities resulting from management of the proceeds, which for the years ended December 31 are as follows:
|
Related Party Transactions (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of notes due to related parties | Investors in the notes are as follows:
_______________ (1)As of December 31, 2020 and 2019, $74 million of these notes have an annual interest rate of 3.16% and $140 million have an annual interest rate of 3.36%.
|
Investments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of investments | The composition of the investment portfolio is presented as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule for fixed income securities at amortized cost, gross unrealized gains and losses and fair value | The amortized cost, gross unrealized gains and losses and fair value for fixed income securities are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule for fixed income securities based on contractual maturities | The scheduled maturities for fixed income securities are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of net investment income | Net investment income for the years ended December 31 is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of realized capital gains and losses by asset type | Realized capital gains (losses) by asset type for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of realized capital gains and losses by transaction type | Realized capital gains (losses) by transaction type for the years ended December 31 are as follows:
_______________ (1)Due to the adoption of the measurement of credit losses on financial instruments accounting standard, prior period other-than-temporary impairment write-downs are now presented as credit losses. (2)Includes valuation of equity securities and certain limited partnership interests where the underlying assets are predominately public equity securities.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of valuation changes | Gross realized gains (losses) on sales of fixed income securities for the years ended December 31 are as follows:
The following table presents the net pre-tax appreciation (decline) recognized in net income of equity securities and limited partnership interests carried at fair value that are still held as of December 31, 2020 and 2019, respectively.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of other-than-temporary impairment losses by asset type | Credit losses recognized in net income (1) for the years ended December 31 are as follows:
_______________ (1)Due to the adoption of the measurement of credit losses on financial instruments accounting standard, realized capital losses previously reported as other-than-temporary impairment write-downs are now presented as credit losses.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of unrealized net capital gains and losses included in accumulated other comprehensive income | Unrealized net capital gains and losses included in AOCI are as follows:
____________ (1)Unrealized net capital gains and losses for limited partnership interests represent the Company’s share of EMA limited partnerships’ OCI. Fair value and gross unrealized gains and losses are not applicable. (2)The insurance reserves adjustment represents the amount by which the reserve balance would increase if the net unrealized gains in the applicable product portfolios were realized and reinvested at lower interest rates, resulting in a premium deficiency. This adjustment primarily relates to structured settlement annuities with life contingencies (a type of immediate fixed annuity). (3)The DAC and DSI adjustment balance represents the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized gains or losses in the respective product portfolios were realized.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of change in unrealized net capital gains and losses | The change in unrealized net capital gains and losses for the years ended December 31 is as follows:
The following table shows the principal geographic distribution of commercial real estate represented in the Company’s mortgage loan portfolio. No other state represented more than 5% of the portfolio as of December 31.
The types of properties collateralizing the mortgage loans as of December 31 are as follows:
The contractual maturities of the mortgage loan portfolio as of December 31, 2020 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying value for limited partnership interests | The carrying value for limited partnership interest as of December 31 is as follows:
____________ (1)Other consists of certain limited partnership interests where the underlying assets are predominately public equity and debt securities.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Principal geographic distribution of municipal bond | The following table shows the principal geographic distribution of municipal bond issuers represented in the Company’s portfolio as of December 31. No other state represents more than 5% of the portfolio.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of other investments | The following table summarizes other investments by asset type.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of allowance for credit loss | The Company’s allowance for credit losses is presented in the following table.
Rollforward of credit loss allowance for fixed income securities for the year ended December 31, 2020 is as follows:
____________ (1)Allowance for fixed income securities as of December 31, 2020 comprised $1 million of ABS. The rollforward of credit loss allowance for bank loans for the years ended December 31 is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of gross unrealized losses and fair value of fixed income and equity securities by length of time | The following table summarizes the gross unrealized losses and fair value of securities by the length of time that individual securities have been in a continuous unrealized loss position.
The following table summarizes gross unrealized losses by unrealized loss position and credit quality as of December 31, 2020.
_______________ (1)Below investment grade fixed income securities include $7 million that have been in an unrealized loss position for less than twelve months. (2)Related to securities with an unrealized loss position less than 20% of amortized cost, net, the degree of which suggests that these securities do not pose a high risk of having credit losses. (3)No below investment grade fixed income securities have been in an unrealized loss position for a period of twelve or more consecutive months. (4)Evaluated based on factors such as discounted cash flows and the financial condition and near-term and long-term prospects of the issue or issuer and were determined to have adequate resources to fulfill contractual obligations.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of carrying value of non-impaired fixed and variable rate mortgage loans by debt service coverage ratio distribution | The following table reflects mortgage loans amortized cost by debt service coverage ratio distribution and year of origination as of December 31.
____________ (1)Due to the adoption of the measurement of credit losses on financial instruments accounting standard, prior valuation allowance is now presented as an allowance for expected credit losses.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of rollforward of the valuation allowance on impaired mortgage loans | The rollforward of credit loss allowance for mortgage loans for the years ended December 31 is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of bank loans amortized cost by credit quality and year of origination | The bank loans amortized cost by credit rating and year of origination as of December 31 is as follows:
|
Fair Value of Assets and Liabilities (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of quantitative information about the significant unobservable inputs used in Level 3 fair value measurements | The following table summarizes the Company’s assets and liabilities measured at fair value as of December 31, 2020.
The following table summarizes the Company’s assets and liabilities measured at fair value as of December 31, 2019.
The following table summarizes quantitative information about the significant unobservable inputs used in Level 3 fair value measurements.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of rollforward of Level 3 assets and liabilities held at fair value on a recurring basis | The following table presents the rollforward of Level 3 assets and liabilities held at fair value during the year ended December 31, 2020.
The following table presents the total Level 3 gains (losses) included in net income for the year ended December 31, 2020.
The following table presents the rollforward of Level 3 assets and liabilities held at fair value during the year ended December 31, 2019.
The following table presents the total Level 3 gains (losses) included in net income for the year ended December 31, 2019.
The following table presents the rollforward of Level 3 assets and liabilities held at fair value during the year ended December 31, 2018.
____________________ (1)Comprises $1 million of assets. The following table presents the total Level 3 gains (losses) included in net income for the year ended December 31, 2018.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of change in unrealized gains and losses included in net income for Level 3 assets and liabilities held | The table below provides valuation changes included in net income and OCI for Level 3 assets and liabilities held as of December 31.
___________________ (1)Effective January 1, 2020, the Company adopted the fair value accounting standard that prospectively requires the disclosure of valuation changes reported in OCI.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of carrying values and fair value estimates of financial instruments not carried at fair value | Presented below are the carrying values and fair value estimates of financial instruments not carried at fair value.
____________________ (1)Represents the amounts reported on the Consolidated Statements of Financial Position.
|
Derivative Financial Instruments and Off-balance sheet Financial Instruments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of volume and fair value positions of derivative instruments and reporting location in the condensed consolidated statement of financial position | The following table provides a summary of the volume and fair value positions of derivative instruments as well as their reporting location in the Consolidated Statement of Financial Position as of December 31, 2020.
_________________________________________ (1) Volume for OTC and cleared derivative contracts is represented by their notional amounts. Volume for exchange traded derivatives is represented by the number of contracts, which is the basis on which they are traded. (n/a = not applicable) The following table provides a summary of the volume and fair value positions of derivative instruments as well as their reporting location in the Consolidated Statement of Financial Position as of December 31, 2019.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of gross and net amounts about the Company's OTC derivatives subject to enforceable master netting arrangements | The following table provides gross and net amounts for the Company’s OTC derivatives, all of which are subject to enforceable master netting agreements.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of impacts on operations and AOCI from foreign currency contracts, cash flow hedges | The following table provides a summary of the impacts of the Company’s foreign currency contracts in cash flow hedging relationships for the years ended December 31.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of gains and losses from valuation, settlements, and hedge ineffectiveness, fair value hedges and derivatives not designated as hedges | The following tables present gains and losses from valuation and settlements reported on derivatives not designated as accounting hedging instruments in the Consolidated Statements of Operations and Comprehensive Income.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of counterparty credit exposure by counterparty credit rating | The following table summarizes the counterparty credit exposure as of December 31 by counterparty credit rating as it relates to the Company’s OTC derivatives.
_________________________ (1)Allstate uses the lower of S&P’s or Moody’s long-term debt issuer ratings. (2)Only OTC derivatives with a net positive fair value are included for each counterparty.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of derivative instruments with credit features in a liability position, including fair value of assets and collateral netted against the liability | The following summarizes the fair value of derivative instruments with credit-risk-contingent features that are in a gross liability position, as well as the fair value of assets and collateral that are netted against the liability in accordance with provisions within legally enforceable MNAs.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of CDS notional amounts by credit rating and fair value of protection sold | The following table shows the CDS notional amounts by credit rating and fair value of protection sold.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contractual amounts of off-balance-sheet financial instruments | The contractual amounts of off-balance sheet financial instruments as of December 31 are as follows:
|
Reserve for Life-Contingent Contract Benefits and Contractholder Funds (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserve for Life-Contingent Contract Benefits and Contractholder Funds | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of reserve for life-contingent contract benefits | As of December 31, the reserve for life-contingent contract benefits consists of the following:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of key assumptions generally used in calculating the reserve for life-contingent contract benefits | The following table highlights the key assumptions generally used in calculating the reserve for life-contingent contract benefits.
______________________ (1)In 2006, the Company disposed of substantially all of its variable annuity business through reinsurance agreements with The Prudential Insurance Company of America, a subsidiary of Prudential Financial, Inc. (collectively “Prudential”)
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of contractholder funds | As of December 31, contractholder funds consist of the following:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of key contract provisions relating to contractholder funds | The following table highlights the key contract provisions relating to contractholder funds.
______________________ (1)In 2006, the Company disposed of substantially all of its variable annuity business through reinsurance agreements with Prudential.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of contractholder funds activity | Contractholder funds activity for the years ended December 31 is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of variable annuity contracts with guarantees | The table below presents information regarding the Company’s variable annuity contracts with guarantees. The Company’s variable annuity contracts may offer more than one type of guarantee in each contract; therefore, the sum of amounts listed exceeds the total account balances of variable annuity contracts’ separate accounts with guarantees.
____________ (1)Defined as the estimated current guaranteed minimum death benefit in excess of the current account balance as of the balance sheet date. (2)Defined as the estimated present value of the guaranteed minimum annuity payments in excess of the current account balance. (3)Defined as the estimated current guaranteed minimum withdrawal balance (initial deposit) in excess of the current account balance as of the balance sheet date. (4)Defined as the estimated present value of the guaranteed minimum accumulation balance in excess of the current account balance.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of liabilities for guarantees | The following table summarizes the liabilities for guarantees.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserves included in total liability balance for guarantees | The following table summarizes reserves included in total liability balance for guarantees by type of benefit as of December 31.
|
Reinsurance (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of retention limits by period of policy issuance | The following table summarizes those retention limits by period of policy issuance.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of reinsurance premium ceded | The amounts ceded to Prudential for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of effects of reinsurance on premiums and contract charges | The effects of reinsurance on premiums and contract charges for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of effects of reinsurance on contract benefits | The effects of reinsurance on contract benefits for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of effects of reinsurance on interest credited to contractholder funds | The effects of reinsurance on interest credited to contractholder funds for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of reinsurance recoverables on paid and unpaid benefits | Reinsurance recoverables, net of allowance, as of December 31 are summarized in the following table.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of rollforward of credit loss allowance for reinsurance recoverables | The following table shows the rollforward of the credit loss allowance for reinsurance recoverables for the year ended December 31.
|
Deferred Policy Acquisition and Sales Inducement Costs (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Policy Acquisition and Sales Inducement Costs | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of deferred policy acquisition costs | Deferred policy acquisition costs for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of DSI activity for Allstate Financial | DSI activity, which primarily relates to fixed annuities and interest-sensitive life contracts, for the years ended December 31 was as follows:
|
Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of the deferred income tax assets and liabilities | The components of the deferred income tax assets and liabilities as of December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of income tax expense | The components of income tax expense for the years ended December 31 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations | A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations for the years ended December 31 is as follows:
|
Other Comprehensive Income (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of other comprehensive (loss) income on a pre-tax and after-tax basis | The components of other comprehensive income (loss) on a pre-tax and after-tax basis for the years ended December 31 are as follows:
|
General (Details) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020
USD ($)
state
|
Dec. 31, 2019
USD ($)
|
Dec. 31, 2018
USD ($)
|
|
Premiums and contract charges by product | |||
Premiums | $ 618 | $ 677 | $ 704 |
Contract charges | 675 | 682 | 695 |
Total premiums and contract charges | $ 1,293 | 1,359 | 1,399 |
Number of states in which entity is authorized to operate | state | 50 | ||
Minimum percentage of premiums from one jurisdiction to be considered as significant (in percent) | 5.00% | ||
Traditional life insurance | |||
Premiums and contract charges by product | |||
Premiums | $ 531 | 557 | 582 |
Accident and health insurance | |||
Premiums and contract charges by product | |||
Premiums | 87 | 120 | 122 |
Interest-sensitive life insurance | |||
Premiums and contract charges by product | |||
Contract charges | 665 | 669 | 680 |
Fixed annuities | |||
Premiums and contract charges by product | |||
Contract charges | $ 10 | $ 13 | $ 15 |
Summary of Significant Accounting Policies - Allowance for credit losses (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Jan. 01, 2020 |
Dec. 31, 2019 |
---|---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Investments | $ 81 | $ 57 | |
Reinsurance recoverables | 15 | 14 | $ 3 |
Other assets | 7 | 7 | |
Assets | 103 | 78 | |
Commitments to fund mortgage loans, bank loans and agent loans | 0 | 1 | |
Liabilities | 0 | 1 | |
Total | 103 | ||
Fixed income securities | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fixed income securities | 1 | 0 | 0 |
Mortgage loans | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Allowance for credit loss | 59 | 36 | $ 3 |
Bank loans | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Allowance for credit loss | 16 | 16 | |
Agent loans | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Allowance for credit loss | $ 5 | $ 5 |
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Supplemental Cash Flow Information [Abstract] | |||
Transfer from investments | $ 5 | $ 67 | $ 43 |
Liabilities for collateral received | 331 | 522 | 517 |
Obligations to return cash collateral for over-the-counter ("OTC") derivatives reported in other liabilities and accrued expenses or other investments | $ 3 | $ 8 | $ 8 |
Supplemental Cash Flow Information - Activities resulting from management of proceeds (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Net change in proceeds managed | |||
Net change in fixed income securities | $ 0 | $ 28 | $ 94 |
Net change in short-term investments | 196 | (33) | (77) |
Operating cash flow provided (used) | 196 | (5) | 17 |
Net change in cash | 0 | 0 | 0 |
Net change in proceeds managed | 196 | (5) | 17 |
Change in Liabilities for Collateral [Roll Forward] | |||
Liabilities for collateral, beginning of year | (530) | (525) | (542) |
Liabilities for collateral, end of year | (334) | (530) | (525) |
Operating cash flow (used) provided | $ (196) | $ 5 | $ (17) |
Investments - Portfolio composition (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Investments [Abstract] | ||
Fixed income securities, at fair value | $ 23,907 | $ 21,725 |
Mortgage loans, net | 3,359 | 3,988 |
Equity securities, at fair value | 1,536 | 1,469 |
Limited partnership interests | 3,065 | 3,250 |
Short-term investments, at fair value | 974 | 1,191 |
Policy loans | 582 | 557 |
Other, net | 1,375 | 1,427 |
Total investments | $ 34,798 | $ 33,607 |
Investments - Scheduled maturities (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Amortized cost, net | ||
Due in one year or less | $ 1,625 | |
Due after one year through five years | 6,974 | |
Due after five years through ten years | 8,255 | |
Due after ten years | 4,234 | |
Subtotal | 21,088 | |
ABS and MBS | 434 | |
Amortized cost, net | 21,522 | $ 20,217 |
Fair value | ||
Due in one year or less | 1,651 | |
Due after one year through five years | 7,423 | |
Due after five years through ten years | 9,197 | |
Due after ten years | 5,193 | |
Subtotal | 23,464 | |
ABS and MBS | 443 | |
Total | $ 23,907 | $ 21,725 |
Investments - Net investment income (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Net investment income | |||
Investment income, before expense | $ 1,323 | $ 1,515 | $ 1,688 |
Investment expense | (81) | (104) | (103) |
Net investment income | 1,242 | 1,411 | 1,585 |
Fixed income securities | |||
Net investment income | |||
Investment income, before expense | 894 | 963 | 991 |
Mortgage loans | |||
Net investment income | |||
Investment income, before expense | 184 | 190 | 188 |
Equity securities | |||
Net investment income | |||
Investment income, before expense | 19 | 29 | 39 |
Limited partnership interests | |||
Net investment income | |||
Investment income, before expense | 99 | 175 | 327 |
Short-term investments | |||
Net investment income | |||
Investment income, before expense | 6 | 31 | 21 |
Policy loans | |||
Net investment income | |||
Investment income, before expense | 31 | 34 | 31 |
Other | |||
Net investment income | |||
Investment income, before expense | $ 90 | $ 93 | $ 91 |
Investments - Schedule of gain (loss) on investments by transaction type (Details) - Fixed income securities - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Debt Securities, Available-for-sale [Line Items] | |||
Gross realized gains | $ 101 | $ 65 | $ 34 |
Gross realized losses | $ (44) | $ (35) | $ (66) |
Investments - Valuation changes (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Investments | ||
Total | $ 329 | $ 273 |
Equity securities | ||
Investments | ||
Total | 229 | 216 |
Limited partnership interests | ||
Investments | ||
Total | $ 100 | $ 57 |
Investments - Unrealized net capital gains and losses (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Fair value | ||
Fair value | $ 23,907 | $ 21,725 |
Short-term investments | 974 | 1,191 |
Gross unrealized Gains | ||
Fixed income securities | 2,427 | 1,549 |
Short-term investments | 0 | 0 |
Gross unrealized Losses | ||
Fixed income securities | (42) | (41) |
Short-term investments | 0 | 0 |
Unrealized net gains (losses) | ||
Fixed income securities | 2,385 | 1,508 |
Short-term investments | 0 | 0 |
EMA limited partnerships | (2) | (2) |
Unrealized net capital gains and losses, pre-tax | 2,383 | 1,506 |
Amounts recognized for: | ||
Amounts recognized for: | (496) | (126) |
DAC and DSI | (363) | (213) |
Amounts recognized | (859) | (339) |
Deferred income taxes | (320) | (245) |
Total unrealized net capital gains and losses | $ 1,204 | $ 922 |
Investments - Principal geographic distribution of municipal bonds (Details) |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Texas | ||
Municipal Bonds | ||
Percentage of municipal bonds carrying value | 16.80% | 17.80% |
California | ||
Municipal Bonds | ||
Percentage of municipal bonds carrying value | 16.80% | 15.00% |
Oregon | ||
Municipal Bonds | ||
Percentage of municipal bonds carrying value | 11.30% | 12.60% |
New Jersey | ||
Municipal Bonds | ||
Percentage of municipal bonds carrying value | 7.40% | 6.70% |
Illinois | ||
Municipal Bonds | ||
Percentage of municipal bonds carrying value | 6.20% | 6.30% |
New York | ||
Municipal Bonds | ||
Percentage of municipal bonds carrying value | 5.30% | 7.00% |
Investments - Other investments by type (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Net investment income | ||
Other, net | $ 1,375 | $ 1,427 |
Agent loans, net | ||
Net investment income | ||
Other, net | 631 | 666 |
Real estate | ||
Net investment income | ||
Other, net | 315 | 292 |
Bank loans, net | ||
Net investment income | ||
Other, net | 245 | 344 |
Derivatives and other | ||
Net investment income | ||
Other, net | $ 184 | $ 125 |
Investments - Rollforward of credit loss allowance for fixed income securities (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Jan. 01, 2020 |
|
Fixed income securities | ||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ 0 | |
Credit losses on securities for which credit losses not previously reported | (3) | |
Reduction of allowance related to sales | 2 | |
Write-offs | 0 | |
Ending balance | (1) | |
Fixed income securities | 1 | $ 0 |
Asset-backed securities | ||
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | ||
Ending balance | (1) | |
Fixed income securities | $ 1 |
Investments - Rollforward of credit loss allowance for mortgage loans (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Bank loans | |||
Rollforward of the valuation allowance on impaired mortgage loans | |||
Beginning balance | $ 0 | ||
Net increases related to credit losses | (4) | ||
Reduction of allowance related to sales | 3 | ||
Write-offs | 1 | ||
Ending balance | (16) | $ 0 | |
Accounting Standards Update 2016-13 | Bank loans | |||
Rollforward of the valuation allowance on impaired mortgage loans | |||
Beginning balance | (16) | ||
Ending balance | (16) | ||
Accounting Standards Update 2016-13 | Mortgage loans | |||
Rollforward of the valuation allowance on impaired mortgage loans | |||
Beginning balance | (33) | ||
Ending balance | (33) | ||
Mortgage loans | |||
Rollforward of the valuation allowance on impaired mortgage loans | |||
Beginning balance | (3) | ||
Net increases related to credit losses | (37) | 0 | $ 0 |
Reduction of allowance related to sales | 15 | ||
Loans transferred due to reinsurance agreement with AAC | (1) | ||
Write-offs | 0 | ||
Ending balance | $ (59) | $ (3) |
Investments - Rollforward of credit loss allowance for bank loans (Details) - Bank loans $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2020
USD ($)
| |
Rollforward of the valuation allowance on impaired mortgage loans | |
Beginning balance | $ 0 |
Net increases related to credit losses | (4) |
Reduction of allowance related to sales | 3 |
Write-offs | 1 |
Ending balance | (16) |
Accounting Standards Update 2016-13 | |
Rollforward of the valuation allowance on impaired mortgage loans | |
Beginning balance | $ (16) |
Ending balance |
Fair Value of Assets and Liabilities - Significant unobservable inputs (Details) - Equity-indexed and forward starting options in life and annuity product contracts - Significant unobservable inputs (Level 3) $ in Millions |
Dec. 31, 2020
USD ($)
|
Dec. 31, 2019
USD ($)
|
---|---|---|
Quantitative information about the significant unobservable inputs | ||
Fair value | $ (483) | $ (395) |
Projected option cost | Minimum | ||
Quantitative information about the significant unobservable inputs | ||
Weighted average | 0.010 | 0.010 |
Projected option cost | Maximum | ||
Quantitative information about the significant unobservable inputs | ||
Weighted average | 0.042 | 0.042 |
Projected option cost | Weighted average | ||
Quantitative information about the significant unobservable inputs | ||
Weighted average | 0.0280 | 0.0257 |
Derivative Financial Instruments and Off-balance sheet Financial Instruments - Gross and net amounts for OTC derivatives (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Asset derivatives | ||
Gross amount | $ 189 | $ 124 |
Derivative asset, counterparty netting | (4) | 0 |
Net amount on balance sheet | 185 | 124 |
Liability derivatives | ||
Gross amount | (631) | (492) |
Derivative liability, counterparty netting | 1 | 10 |
Net amount on balance sheet | (630) | (482) |
OTC derivatives | ||
Asset derivatives | ||
Gross amount | 6 | 10 |
Derivative asset, counterparty netting | (5) | (10) |
Derivative asset, cash collateral (received) pledged | (1) | 0 |
Net amount on balance sheet | 0 | 0 |
Securities collateral (received) pledged | 0 | 0 |
Net amount | 0 | 0 |
Liability derivatives | ||
Gross amount | (9) | (5) |
Derivative liability, counterparty netting | 5 | 10 |
Derivative liability offsets under cash collateral pledged | 4 | (7) |
Net amount on balance sheet | 0 | (2) |
Securities collateral (received) pledged | 0 | 0 |
Net amount | $ 0 | $ (2) |
Derivative Financial Instruments and Off-balance sheet Financial Instruments - Counterparty credit exposure and other (Details) $ in Millions |
Dec. 31, 2020
USD ($)
counter-party
|
Dec. 31, 2019
USD ($)
counter-party
|
---|---|---|
Credit Derivatives | ||
Number of counter-parties | counter-party | 3 | 5 |
Notional amount | $ 94 | $ 296 |
Credit exposure | 3 | 7 |
Exposure, net of collateral | 0 | 0 |
Gross liability fair value of contracts containing credit-risk-contingent features | 8 | 4 |
Gross asset fair value of contracts containing credit-risk-contingent features and subject to MNAs | (3) | (3) |
Collateral posted under MNAs for contracts containing credit-risk-contingent features | (5) | (1) |
Maximum amount of additional exposure for contracts with credit-risk-contingent features if all features were triggered concurrently | $ 0 | $ 0 |
A plus | ||
Credit Derivatives | ||
Number of counter-parties | counter-party | 3 | 5 |
Notional amount | $ 94 | $ 296 |
Credit exposure | 3 | 7 |
Exposure, net of collateral | $ 0 | $ 0 |
Derivative Financial Instruments and Off-balance sheet Financial Instruments - Off-balance sheet financial instruments (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Commitments to invest in limited partnership interests | $ 918 | $ 1,063 |
Private placement commitments | 0 | 16 |
Other loan commitments | $ 75 | $ 118 |
Reserve for Life-Contingent Contract Benefits and Contractholder Funds - Narrative (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Sep. 30, 2020 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Reserve for life-contingent contract benefits with respect to deficiency | $ 496,000,000 | $ 126,000,000 | |
Life and Annuity Insurance Product Line | Allstate Annuities | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Premium deficiency charge for immediate annuities, after tax | $ 226,000,000 | ||
Variable annuities | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | |||
Account balances of separate accounts with guarantees, invested in equity, fixed income and balanced mutual funds | 2,940,000,000 | 2,660,000,000 | |
Account balances of separate accounts with guarantees, invested in money market mutual funds | $ 238,000,000 | $ 252,000,000 |
Reserve for Life-Contingent Contract Benefits and Contractholder Funds - Contractholder funds (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Contractholder funds activity | |||
Balance, beginning of year | $ 16,711 | $ 17,470 | $ 18,592 |
Deposits | 818 | 834 | 863 |
Interest credited | 574 | 581 | 597 |
Benefits | (733) | (769) | (810) |
Surrenders and partial withdrawals | (649) | (844) | (1,095) |
Contract charges | (643) | (637) | (645) |
Net transfers from separate accounts | 5 | 11 | 7 |
Reinsurance assumed from AAC | 256 | 0 | 0 |
Other adjustments | 142 | 65 | (39) |
Balance, end of year | $ 16,481 | $ 16,711 | $ 17,470 |
Reserve for Life-Contingent Contract Benefits and Contractholder Funds - Variable annuity contracts with guarantees and other (Details) - Variable annuities - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
|
In the event of death | ||
Variable annuity contracts with guarantees | ||
Separate account value | $ 3,174 | $ 2,908 |
Net amount at risk | $ 308 | $ 373 |
Average attained age of contractholders (in years) | 72 years | 71 years |
Liability for guarantees related to income benefits | ||
Variable annuity contracts with guarantees | ||
Separate account value | $ 925 | $ 848 |
Net amount at risk | 140 | 173 |
For cumulative periodic withdrawals | ||
Variable annuity contracts with guarantees | ||
Separate account value | 178 | 190 |
Net amount at risk | 12 | 13 |
Guaranteed accumulation benefits | ||
Variable annuity contracts with guarantees | ||
Separate account value | 93 | 123 |
Net amount at risk | $ 11 | $ 15 |
Weighted average waiting period until guarantee date (in years) | 3 years | 4 years |
Reserve for Life-Contingent Contract Benefits and Contractholder Funds - Liabilities for guarantees narrative (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
---|---|---|---|
Liabilities for guarantees: | |||
Liability for guarantees | $ 476 | $ 418 | $ 443 |
Variable annuities | |||
Liabilities for guarantees: | |||
Liability for guarantees | 476 | 418 | 443 |
Variable annuities | In the event of death | |||
Liabilities for guarantees: | |||
Liability for guarantees | 67 | 78 | 109 |
Variable annuities | Liability for guarantees related to income benefits | |||
Liabilities for guarantees: | |||
Liability for guarantees | 24 | 21 | 36 |
Variable annuities | Guaranteed accumulation benefits | |||
Liabilities for guarantees: | |||
Liability for guarantees | 18 | 18 | 25 |
Variable annuities | For cumulative periodic withdrawals | |||
Liabilities for guarantees: | |||
Liability for guarantees | 15 | 14 | 14 |
Variable annuities | Other guarantees | |||
Liabilities for guarantees: | |||
Liability for guarantees | $ 352 | $ 287 | $ 259 |
Reinsurance - Reinsurance items (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Reinsurance recoverable | |||
Interest credited to contractholder funds | $ 44 | $ 40 | $ 44 |
Prudential | |||
Reinsurance recoverable | |||
Premiums and contract charges | 64 | 65 | 72 |
Contract benefits | 46 | (4) | 87 |
Interest credited to contractholder funds | 20 | 19 | 20 |
Operating costs and expenses | 12 | 12 | 14 |
Affiliate | |||
Reinsurance recoverable | |||
Premiums and contract charges | 44 | 49 | 51 |
Contract benefits | 37 | 35 | 35 |
Interest credited to contractholder funds | 18 | 20 | 20 |
Non-affiliate | |||
Reinsurance recoverable | |||
Premiums and contract charges | 227 | 270 | 275 |
Contract benefits | 139 | 152 | 214 |
Interest credited to contractholder funds | $ 26 | $ 20 | $ 24 |
Reinsurance - Ceded to Prudential (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Reinsurance | |||
Interest credited to contractholder funds | $ 44 | $ 40 | $ 44 |
Prudential | |||
Reinsurance | |||
Premiums and contract charges | 64 | 65 | 72 |
Contract benefits | 46 | (4) | 87 |
Interest credited to contractholder funds | 20 | 19 | 20 |
Operating costs and expenses | $ 12 | $ 12 | $ 14 |
Reinsurance - Rollforward of credit loss allowance for reinsurance recoverables (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Reinsurance Recoverable, Allowance for Credit Loss [Roll Forward] | ||
Reinsurance recoverable, allowance for credit loss, beginning balance | $ (3) | |
Cumulative effect of change in accounting principle | $ (11) | |
Increase in the provision for credit losses | (1) | |
Write-offs | 0 | |
Reinsurance recoverable, allowance for credit loss, ending balance | $ (15) |
Reinsurance - Retention limits by period of policy issuance (Details) - USD ($) |
1 Months Ended | 33 Months Ended | 45 Months Ended | 48 Months Ended | 106 Months Ended |
---|---|---|---|---|---|
Aug. 31, 1998 |
Dec. 31, 2017 |
Mar. 31, 2011 |
Mar. 31, 2015 |
Jun. 30, 2007 |
|
Reinsurance | |||||
Reinsurance retention policy, amount retained | $ 1,000,000 | $ 5,000,000 | $ 2,000,000 | ||
Retention level for contracts issued to individuals age 70 and over | 3,000,000 | ||||
Retention level for certain large contracts meeting specific criteria | $ 10,000,000 | $ 5,000,000 | |||
Single life | |||||
Reinsurance | |||||
Reinsurance retention policy, amount retained | $ 2,000,000 | $ 5,000,000 | |||
Retention level for contracts issued to individuals age 70 and over | 3,000,000 | ||||
Retention level for certain large contracts meeting specific criteria | 10,000,000 | ||||
Joint life | |||||
Reinsurance | |||||
Reinsurance retention policy, amount retained | 8,000,000 | ||||
Retention level for certain large contracts meeting specific criteria | $ 10,000,000 |
Deferred Policy Acquisition and Sales Inducement Costs (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Deferred policy acquisition costs | |||
Balance, beginning of year | $ 947 | $ 1,232 | $ 1,156 |
Acquisition costs deferred | 51 | 55 | 78 |
Amortization charged to income | (147) | (180) | (146) |
Effect of unrealized gains and losses | (123) | (160) | 144 |
Reinsurance assumed from AAC | 245 | 0 | 0 |
Balance, end of year | 973 | 947 | 1,232 |
DSI activity relates to fixed annuities and interest-sensitive life contracts | |||
Balance, beginning of year | 27 | 34 | 36 |
Amortization charged to income | (5) | (5) | (4) |
Effect of unrealized gains and losses | 3 | (2) | 2 |
Balance, end of year | $ 25 | $ 27 | $ 34 |
Guarantees and Contingent Liabilities (Details) - Guaranty funds - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Guarantees and Contingent Liabilities | ||
Liability for insurance assessments | $ 4 | $ 4 |
Insurance assessments, premium tax offsets | $ 6 | $ 6 |
Income Taxes - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Components of the deferred income tax assets and liabilities | |||
Unrecognized tax benefits | $ 12 | $ 14 | $ 14 |
Unrecognized tax benefits, increase in liability | 12 | ||
Income taxes paid | 30 | 62 | $ 30 |
Current income tax receivable | $ 35 | ||
Current income tax payable | $ 29 |
Income Taxes - Components of the deferred income tax assets and liabilities (Details) - USD ($) $ in Millions |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Deferred tax assets | ||
Deferred reinsurance gain | $ 5 | $ 6 |
Other assets | 1 | 1 |
Total deferred tax assets | 6 | 7 |
Deferred tax liabilities | ||
Unrealized net capital gains | (320) | (245) |
Life and annuity reserves | (231) | (253) |
Investments | (181) | (185) |
DAC | (181) | (169) |
Other liabilities | (49) | (49) |
Total deferred tax liabilities | (962) | (901) |
Net deferred tax liability | $ (956) | $ (894) |
Income Taxes - Components of income tax expense (benefit) (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Income Tax Disclosure [Abstract] | |||
Current | $ 26 | $ 76 | $ 116 |
Deferred | (19) | 52 | (99) |
Total income tax expense | $ 7 | $ 128 | $ 17 |
Income Taxes - Reconciliation of income tax percentage (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Income Tax Disclosure [Abstract] | |||
Statutory federal income tax rate - expense | 21.00% | 21.00% | 21.00% |
Tax credits | (14.90%) | (1.90%) | (3.20%) |
Adjustments to prior year tax liabilities | (3.10%) | 0.20% | (0.30%) |
Dividends received deduction | (1.90%) | (0.50%) | (0.70%) |
State income taxes | 3.40% | 0.50% | 1.50% |
Non-deductible expenses | 0.00% | 0.10% | 0.00% |
Tax Legislation benefit | 0.00% | 0.00% | (14.00%) |
Other | (0.10%) | 0.00% | 0.10% |
Effective income tax rate - expense | 4.40% | 19.40% | 4.40% |
Capital Structure (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Debt Instrument [Line Items] | |||
Interest paid | $ 7 | $ 5 | $ 5 |
Other liabilities and accrued expenses | 1,007 | 1,181 | |
Limited Partnership | |||
Debt Instrument [Line Items] | |||
Other liabilities and accrued expenses | $ 85 | $ 61 |
Statutory Financial Information and Dividend Limitations (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020
USD ($)
|
Dec. 31, 2019
USD ($)
|
Dec. 31, 2018
USD ($)
|
|
Statutory Accounting Practices [Line Items] | |||
Statutory net income (loss) | $ (125,000,000) | $ 363,000,000 | $ 410,000,000 |
Statutory capital and surplus | 3,930,000,000 | 3,810,000,000 | |
Dividends paid | 0 | 75,000,000 | $ 250,000,000 |
Maximum amount of dividends ALIC able to pay without prior IL DOI approval | 393,000,000 | ||
Deficit position used to determine payment of dividends | $ 864,000,000 | ||
Multiplier of authorized control level RBC to determine action level RBC | 2 | ||
Statutory accounting practices, statutory capital and surplus, adjusted balance | $ 4,440,000,000 | ||
Authorized control level RBC | 622,000,000 | ||
Subsidiaries | |||
Statutory Accounting Practices [Line Items] | |||
Proceeds from dividends | $ 0 | $ 0 |
Benefit Plans (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2018 |
|
Allstate 401(k) Savings Plan | |||
Cost allocated to Allstate 401(k) Savings Plan | $ 4 | $ 4 | $ 5 |
Pension benefits | |||
Benefit Plans | |||
Allocated Cost (Credit) | $ 2 | $ 3 | $ 2 |
Y0K44TH\"
M/M*UB.$!<1(Z%6\AN2!1YQL)@S!PZ$5MRI'5B_Y'RA\B7+81+FV$RZ\B/.XK
M.+6$;O?EPYJ,[QT ';FA=L/7G&=M*ZL6>-]UM547&-COD\EI\EJD!I/O!E,?T \NCS4G
M_/D_$%"=O7UW]O[!@)I)V BHR^2U2)VE?7>6OBSRX^'8PN6V3IR^NQTX[(UM
MH/-6X,Y;/W#2'0#'3^9)-V"E*FH+[P*=KH+OE/4'1#'0F2/X&>^] YT\@I_V
MOB PWTV/5R)@XGOC ,E?!X$@A?+<&EPMH.&;Q@K^H]]AJ
M\>V#Q]F'$ QO)H+1AC]8.@O"PA;DB]CQY]:9?B (($K*)U5SR;6#"CW ZP9AX@BB8:TH1V+#L)'S?*8_ 80M/-_=:/>6@R JI\O9:_,2,LJ1Q
M(MWJ]FBGN/3#-'('OW,W-OOX"]SN5%!N972W7,$FK1*S$V^4,3.P4Y?\'7P:
M'IK$8<5E B/HF:9/CL3?K*J"T!_[>"%[#4E T$%' F#F<7*^6P)S9Y7KDZ1;
M$E(2A2A<-OT*D]-M;)W"&(X'KG&@V]N>J$4B'A#"MC 54W?!5,1GN,"BVO>.
M%1%4E_,7\E@R>?F#-B=P0L:X9R7J*NCN 4(.PH6*=*YKLM)@QZ)>S5%BMY*.
M:].,Q3UR<,A $#_S/AU?S,0\'W.?CL\N^F^^.6P83KQOT ^@1G7RZPXP\E!@
MS9 5Q#$
M.B@W)&2+U_QG4;X'/!O!54--D8.]DE:-P"5*7%'E>[#/"G X0<4I.6&?)#7"
MO2NI-G&F1>*"D&JH([.4_>6WR6"WEUU?* C'T> RZ9^C6=*81S_Z*SIP D)_
MP7K--=Z;%M5-#@YHZVBO2C95UTZBY;&H@\IYG"$?6U,]\K%/]=A/?;>LUOW$
M9NF4.2?L8:M8'K#LE+ML]P1.U*E](7OX%2U.,ACR ZA3A3F;.] ,MF9[+DQA
MY 1X^J
M<;$,@ S':]H @7GBX)8._^CV"^P[AH$B6N6JU/(9U :#C2T?%!
MI -@826$2K4Q%H&\(I!N/YTJ]!$%/>F=30O]9:Y+L9)Q<*76O143<)^FUJ.[$*WUO=CYC^MD4W0W3_!O&@X$^&<4#4,Q#O
MWH0BAG[D!;[TJV(N.08I3@ A8OVPR9L2,]HL+2_1PEG38AUE-MJ I5E%N)4W
M=K-K7W34)HPKA*[IO&MXO*VL/KM S0-+2]YGM^*>PXAWREA,MP!R245K)+5Q
M= $PLNR?RDJ7R>:H$YH>#4(0*HREXN>:37XEL_X/P7UV Y=B@(>IML+O8Y_5
M@\XY!-\ERW#:
)-:'IL&"8:22Q:QX+[%Q
MA^NY0K4E4C Q%<_?=CO4L$3%*DL6C JX%3[+TR39P)I5-6+_[6 ';4;3;ERV
M->GZ?ZT\&GXX3E;)J
M5&LKW0JC%J\.+B<_7YW2>E[P>Z4V-OM9D"1SK;_0AYORU<$),:1J53BB(/'7
MG;I6=4V$P,8?@>9!.I(VYC]'ZN]8=L@REU9=Z_I?5>E6KPZ>'8A2+617N\]Z
M\XL*\IP1O4+7EO\4&[]VAL5%9YUNPF9PT%2M_UM^#7K(-CP[>6##-&R8,M_^
M(.;RC73R]4NC-\+0:E"C'UA4W@WFJI:,
BY4>FPU,*4H+?)F\G8E\\R#(G_4)*0:KY!FFY <9,YU/X
M-Y[!GW__MV48A"_IXV **M#DZ28] <^"\1QD$P%K]37A> J
"6U/;TS&9#LV=4II;9%,IM:&X\%-#*