DEFERRED POLICY ACQUISITION COSTS

3 Months Ended

Mar. 31, 2023

DEFERRED POLICY ACQUISITION COSTSThe following tables present a rollforward of deferred policy acquisition costs by reporting segment and disaggregated by product type.


	March 31, 2023
	Aflac Japan								Aflac U.S.
(In millions)	Cancer		Medical and Other Health		Life Insurance		Other		Accident		Disability		Critical Care		Hospital Indemnity		Dental/Vision		Life Insurance		Other		Total
Deferred policy acquisition costs:
Balance at December 31, 2022	$	3,035	$	2,161	$	525	$	55	$	904	$	613	$	1,304	$	418	$	88	$	135	$	1	$	9,239
Capitalization	76		33		9		4		39		31		41		21		2		14		0		270
Amortization expense	(48)		(28)		(9)		0		(34)		(28)		(34)		(16)		(3)		(6)		1		(205)

Foreign currency translation and other	(19)		(13)		(3)		(1)		0		0		0		0		0		0		(1)		(37)
Balance at March 31, 2023	$	3,044	$	2,153	$	522	$	58	$	909	$	616	$	1,311	$	423	$	87	$	143	$	1	$	9,267


	December 31, 2022
	Aflac Japan								Aflac U.S.
(In millions)	Cancer		Medical and Other Health		Life Insurance		Other		Accident		Disability		Critical Care		Hospital Indemnity		Dental/Vision		Life Insurance		Other		Total
Deferred policy acquisition costs:
Balance at December 31, 2021	$	3,464	$	2,372	$	595	$	51	$	887	$	604	$	1,270	$	399	$	90	$	115	$	1	$	9,848
Capitalization	291		161		33		12		147		117		160		80		11		40		0		1,052
Amortization expense	(188)		(112)		(35)		(3)		(130)		(108)		(126)		(61)		(13)		(20)		4		(792)

Foreign currency translation and other	(532)		(260)		(68)		(5)		0		0		0		0		0		0		(4)		(869)
Balance at December 31, 2022	$	3,035	$	2,161	$	525	$	55	$	904	$	613	$	1,304	$	418	$	88	$	135	$	1	$	9,239

The Company uses the following constant level bases to amortize deferred policy acquisition costs:


Policy Type						Constant-level Basis
Life Products (U.S.)						Face Value
Health Products (U.S.)						Policy Count
Health & Life Products (Japan)						Units in Force

Face value is the stated dollar amount that the policy’s beneficiaries receive upon the death of the insured. For life and health products issued in Japan, the constant-level basis used is units in force, which is a proxy for face amount and insurance in force, respectively. Future DAC amortization is impacted by persistency.

There were no changes to the inputs, judgements, assumptions and methods used to determine amortization amounts during the three-month periods ended March 31, 2023 and 2022.

See Note 1 of the Notes to the Consolidated Financial Statements for more information on deferred policy acquisition costs.