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Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value of Financial Instruments [Abstract]

Carrying And Estimated Fair Values Of Financial Instruments



	As of June 30, 2020						As of December 31, 2019
	Carrying			Fair			Carrying			Fair
	Value			Value			Value			Value
Assets
Fixed maturity AFS securities	$	113,519		$	113,519		$	105,200		$	105,200
Trading securities		4,651			4,651			4,673			4,673
Equity securities		87			87			103			103
Mortgage loans on real estate		16,578			18,392			16,339			16,872
Derivative investments ⁽¹⁾		2,957			2,957			1,911			1,911
Other investments		4,564			4,564			2,983			2,983
Cash and invested cash		4,201			4,201			2,563			2,563
Other assets:
GLB direct embedded derivatives		-			-			450			450
GLB ceded embedded derivatives		571			571			60			60
Indexed annuity ceded embedded derivatives		664			664			927			927
Separate account assets		146,787			146,787			153,566			153,566

Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(2,272	)		(2,272	)		(2,585	)		(2,585	)
Other contract holder funds:
Remaining guaranteed interest and similar contracts		(1,868	)		(1,868	)		(1,900	)		(1,900	)
Account values of certain investment contracts		(40,081	)		(57,365	)		(38,639	)		(46,822	)
Short-term debt		-			-			(300	)		(304	)
Long-term debt		(6,736	)		(6,561	)		(6,067	)		(6,217	)
Reinsurance related embedded derivatives		(245	)		(245	)		(327	)		(327	)
Other liabilities:
Derivative liabilities⁽¹⁾		(1,279	)		(1,279	)		(349	)		(349	)
GLB direct embedded derivatives		(3,086	)		(3,086	)		-			-
GLB ceded embedded derivatives		-			-			(9	)		(9	)

⁽¹⁾We have master netting agreements with each of our derivative counterparties, which allow for the netting of our derivative asset and liability positions by counterparty.

Schedule of Mortgage Loans With Election Of Fair Value Option



	As of
	June 30,
	2020
Commercial mortgage loans: ⁽¹⁾
Fair value	$	777
Aggregate contractual principal		756

⁽¹⁾As of June 30, 2020, no loans for which the fair value option has been elected were in non-accrual status and none were more than 90 days past due and still accruing.

Fair Value Of Assets And Liabilities On A Recurring Basis



		As of June 30, 2020
		Quoted
		Prices
		in Active
	Markets for			Significant				Significant
		Identical		Observable				Unobservable				Total
		Assets			Inputs				Inputs			Fair
		(Level 1)			(Level 2)				(Level 3)			Value
Assets
Investments:
Fixed maturity AFS securities:
Corporate bonds		$	-		$	91,046			$	4,344		$	95,390
U.S. government bonds			467			32				5			504
State and municipal bonds			-			6,393				-			6,393
Foreign government bonds			-			350				86			436
RMBS			-			3,270				2			3,272
CMBS			-			1,225				1			1,226
ABS			-			5,292				424			5,716
Hybrid and redeemable preferred securities			75			417				90			582
Mortgage loans on real estate			-			777				-			777
Trading securities			5			3,973				673			4,651
Equity securities			12			46				29			87
Derivative investments ⁽¹⁾			-			2,345				2,020			4,365
Cash and invested cash			-			4,201				-			4,201
Other assets:
GLB ceded embedded derivatives			-			-				571			571
Indexed annuity ceded embedded derivatives			-			-				664			664
Separate account assets			552			146,225				-			146,777
Total assets		$	1,111		$	265,592			$	8,909		$	275,612

Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		$	-		$	-			$	(2,272	)	$	(2,272	)
Reinsurance related embedded derivatives			-			(245	)			-			(245	)
Other liabilities:
Derivative liabilities ⁽¹⁾			-			(1,262	)			(1,425	)		(2,687	)
GLB direct embedded derivatives			-			-				(3,086	)		(3,086	)
Total liabilities		$	-		$	(1,507	)		$	(6,783	)	$	(8,290	)

‎


		As of December 31, 2019
		Quoted
		Prices
		in Active
	Markets for			Significant				Significant
		Identical		Observable				Unobservable				Total
		Assets			Inputs				Inputs			Fair
		(Level 1)			(Level 2)				(Level 3)			Value
Assets
Investments:
Fixed maturity AFS securities:
Corporate bonds		$	-		$	84,435			$	4,281		$	88,716
U.S. government bonds			424			6				5			435
State and municipal bonds			-			5,884				-			5,884
Foreign government bonds			-			303				90			393
RMBS			-			3,230				11			3,241
CMBS			-			1,082				1			1,083
ABS			-			4,621				268			4,889
Hybrid and redeemable preferred securities			77			404				78			559
Trading securities			50			3,957				666			4,673
Equity securities			25			48				30			103
Derivative investments ⁽¹⁾			-			1,212				1,735			2,947
Cash and invested cash			-			2,563				-			2,563
Other assets:
GLB direct embedded derivatives			-			-				450			450
GLB ceded embedded derivatives			-			-				60			60
Indexed annuity ceded embedded derivatives			-			-				927			927
Separate account assets			639			152,916				-			153,555
Total assets		$	1,215		$	260,661			$	8,602		$	270,478

Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		$	-		$	-			$	(2,585	)	$	(2,585	)
Reinsurance related embedded derivatives			-			(327	)			-			(327	)
Other liabilities:
Derivative liabilities ⁽¹⁾			-			(518	)			(867	)		(1,385	)
GLB ceded embedded derivatives			-			-				(9	)		(9	)
Total liabilities		$	-		$	(845	)		$	(3,461	)	$	(4,306	)

⁽¹⁾Derivative investment assets and liabilities are presented within the fair value hierarchy on a gross basis by derivative type and not on a master netting basis by counterparty.

‎

Fair Value Measured On A Recurring Basis Reconciliation



	For the Three Months Ended June 30, 2020
							Gains		Issuances,				Transfers
				Items			(Losses)			Sales,			Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽²⁾			Value
Investments: ⁽³⁾
Fixed maturity AFS securities:
Corporate bonds	$	4,103		$	-		$	205		$	(14	)		50		$	4,344
U.S. government bonds		5			-			-			-			-			5
Foreign government bonds		87			-			(1	)		-			-			86
RMBS		1			-			-			-			1			2
CMBS		1			-			-			-			-			1
ABS		196			-			5			236			(13	)		424
Hybrid and redeemable
preferred securities		72			-			4			(4	)		18			90
Trading securities		651			28			-			(14	)		8			673
Equity securities		30			(1	)		-			-			-			29
Derivative investments		2,027			(1,402	)		(12	)		(18	)		-			595
Other assets: ⁽⁴⁾
GLB ceded embedded derivatives		728			(157	)		-			-			-			571
Indexed annuity ceded embedded derivatives		799			304			-			(439	)		-			664
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁴⁾		(1,380	)		(831	)		-			(61	)		-			(2,272	)
Other liabilities – GLB direct embedded
derivatives ⁽⁴⁾		(4,596	)		1,510			-			-			-			(3,086	)
Total, net	$	2,724		$	(549	)	$	201		$	(314	)	$	64		$	2,126

‎



	For the Three Months Ended June 30, 2019
							Gains		Issuances,				Transfers
				Items			(Losses)			Sales,			Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽²⁾			Value
Investments: ⁽³⁾
Fixed maturity AFS securities:
Corporate bonds	$	3,521		$	1		$	24		$	171		$	(69	)	$	3,648
Foreign government bonds		110			-			3			-			-			113
CMBS		2			-			-			-			-			2
ABS		178			-			1			259			(118	)		320
Hybrid and redeemable
preferred securities		78			-			-			-			-			78
Trading securities		236			2			-			371			(86	)		523
Equity securities		25			-			-			43			-			68
Derivative investments		267			71			69			59			-			466
Other assets: ⁽⁴⁾
GLB direct embedded derivatives		439			(439	)		-			-			-			-
GLB ceded embedded derivatives		50			61			-			-			-			111
Indexed annuity ceded embedded derivatives		872			44			-			(13	)		-			903
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁴⁾		(1,730	)		(154	)		-			(89	)		-			(1,973	)
Other liabilities: ⁽⁴⁾
GLB direct embedded derivatives		-			(1	)											(1	)
GLB ceded embedded derivatives		(8	)		8			-			-			-			-
Total, net	$	4,040		$	(407	)	$	97		$	801		$	(273	)	$	4,258


	For the Six Months Ended June 30, 2020
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽²⁾			Value
Investments: ⁽³⁾
Fixed maturity AFS securities:
Corporate bonds	$	4,281		$	-		$	(180	)	$	151		$	92		$	4,344
U.S. government bonds		5			-			-			-			-			5
Foreign government bonds		90			-			(4	)		-			-			86
RMBS		11			-			-			-			(9	)		2
CMBS		1			-			-			-			-			1
ABS		268			-			1			258			(103	)		424
Hybrid and redeemable
preferred securities		78			-			(2	)		(4	)		18			90
Trading securities		666			(4	)		-			(20	)		31			673
Equity securities		30			(1	)		-			-			-			29
Derivative investments		868			(405	)		267			(135	)		-			595
Other assets: ⁽⁴⁾
GLB direct embedded derivatives		450			(450	)		-			-			-			-
GLB ceded embedded derivatives		60			511			-			-			-			571
Indexed annuity ceded embedded derivatives		927			189			-			(452	)		-			664
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁴⁾		(2,585	)		312			-			1			-			(2,272	)
Other liabilities: ⁽⁴⁾
GLB direct embedded derivatives		-			(3,086	)		-			-			-			(3,086	)
GLB ceded embedded derivatives		(9	)		9			-			-			-			-
Total, net	$	5,141		$	(2,925	)	$	82		$	(201	)	$	29		$	2,126

‎


	For the Six Months Ended June 30, 2019
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽²⁾			Value
Investments: ⁽³⁾
Fixed maturity AFS securities:
Corporate bonds	$	3,269		$	-		$	94		$	371		$	(86	)	$	3,648
Foreign government bonds		109			-			4			-			-			113
RMBS		7			-			-			-			(7	)		-
CMBS		2			-			-			-			-			2
ABS		134			-			1			408			(223	)		320
Hybrid and redeemable
preferred securities		75			-			3			-			-			78
Trading securities		67			2			-			577			(123	)		523
Equity securities		25			-			-			43			-			68
Derivative investments		534			(312	)		115			129			-			466
Other assets: ⁽⁴⁾
GLB direct embedded derivatives		123			(123	)		-			-			-			-
GLB ceded embedded derivatives		72			39			-			-			-			111
Indexed annuity ceded embedded derivatives		902			121			-			(120	)		-			903
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁴⁾		(1,305	)		(470	)		-			(198	)		-			(1,973	)
Other liabilities – GLB ceded embedded
derivatives ⁽⁴⁾		-			(1	)		-			-			-			(1	)
Total, net	$	4,014		$	(744	)	$	217		$	1,210		$	(439	)	$	4,258

⁽¹⁾The changes in fair value of the interest rate swaps are offset by an adjustment to derivative investments (see Note 5).

⁽²⁾Transfers into or out of Level 3 for fixed maturity AFS and trading securities are reported at amortized cost as of the beginning-of-year. For fixed maturity AFS and trading securities, the difference between beginning-of-period amortized cost and beginning-of-period fair value was included in OCI and earnings, respectively, in the prior period.

⁽³⁾Amortization and accretion of premiums and discounts are included in net investment income on our Consolidated Statements of Comprehensive Income (Loss). Gains (losses) from sales, maturities, settlements and calls and credit loss expense are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

⁽⁴⁾Gains (losses) from the changes in fair value are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

‎

Schedule Of Investment Holdings Movements



	For the Three Months Ended June 30, 2020
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	193		$	(99	)	$	(36	)	$	(43	)	$	(29	)	$	(14	)
ABS		242			-			-			(6	)		-			236
Hybrid and redeemable preferred
securities		-			(4	)		-			-			-			(4	)
Trading securities		1			-			-			(15	)		-			(14	)
Equity securities		1			(1	)		-			-			-			-
Derivative investments		131			(94	)		(55	)		-			-			(18	)
Other assets – indexed annuity ceded
embedded derivatives		8			-			-			(447	)		-			(439	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(92	)		-			-			31			-			(61	)
Total, net	$	484		$	(198	)	$	(91	)	$	(480	)	$	(29	)	$	(314	)



	For the Three Months Ended June 30, 2019
	Issuances			Sales			Maturities		Settlements				Calls		Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	268		$	(16	)	$	(47	)	$	(34	)	$	-	$	171
ABS		261			-			-			(2	)		-		259
Trading securities		371			-			-			-			-		371
Equity securities		43			-			-			-			-		43
Derivative investments		141			4			(86	)		-			-		59
Other assets – indexed annuity ceded
embedded derivatives		21			-			-			(34	)		-		(13	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(149	)		-			-			60			-		(89	)
Total, net	$	956		$	(12	)	$	(133	)	$	(10	)	$	-	$	801



	For the Six Months Ended June 30, 2020
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	529		$	(172	)	$	(34	)	$	(94	)	$	(78	)	$	151
ABS		279			-			-			(21	)		-			258
Hybrid and redeemable preferred
securities		-			(4	)		-			-			-			(4	)
Trading securities		38			(25	)		-			(33	)		-			(20	)
Equity securities		1			(1	)		-			-			-			-
Derivative investments		249			(218	)		(166	)		-			-			(135	)
Other assets – indexed annuity ceded
embedded derivatives		17			-			-			(469	)		-			(452	)
Future contract benefits – indexed annuity								-
and IUL contracts embedded derivatives		(81	)		-			-			82			-			1
Total, net	$	1,032		$	(420	)	$	(200	)	$	(535	)	$	(78	)	$	(201	)


	For the Six Months Ended June 30, 2019
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	535		$	(18	)	$	(54	)	$	(85	)	$	(7	)	$	371
ABS		410			-			-			(2	)		-			408
Trading securities		578			-			-			(1	)		-			577
Equity securities		43			-			-			-			-			43
Derivative investments		272			(11	)		(132	)		-			-			129
Other assets – indexed annuity ceded
embedded derivatives		40			-			-			(160	)		-			(120	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(296	)		-			-			98			-			(198	)
Total, net	$	1,582		$	(29	)	$	(186	)	$	(150	)	$	(7	)	$	1,210

Changes In Unrealized Gains (Losses) Within Level 3 Financial Instruments Carried At Fair Value And Still Held



	For the Three						For the Six
	Months Ended						Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
GLB	$	1,662		$	(267	)	$	(3,205	)	$	213
Derivative investments		(1,361	)		18			(466	)		(269	)
Embedded derivatives:
Indexed annuity and IUL contracts		230			(44	)		308			(76	)
Total, net⁽¹⁾	$	531		$	(293	)	$	(3,363	)	$	(132	)

⁽¹⁾Included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

Changes in Unrealized Gains (Losses) Included in OCI



	For the Three				For the Six
	Months Ended				Months Ended
		June 30,				June 30,
		2020				2020
Fixed maturity AFS securities:
Corporate bonds		$	174			$	(194	)
Foreign government bonds			(1	)			(4	)
ABS			6				2
Hybrid and redeemable preferred securities			4				(2	)
Total, net		$	183			$	(198	)

Components Of The Transfers In And Out Of Level 3



	For the Three								For the Three
	Months Ended								Months Ended
	June 30, 2020								June 30, 2019
	Transfers		Transfers						Transfers		Transfers
	Into		Out of						Into		Out of
	Level 3		Level 3			Total			Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	135	$	(85	)	$	50		$	2	$	(71	)	$	(69	)
RMBS		1		-			1			-		-			-
ABS		15		(28	)		(13	)		-		(118	)		(118	)
Hybrid and redeemable preferred
securities		18		-			18			-		-			-
Trading securities		10		(2	)		8			5		(91	)		(86	)
Total, net	$	179	$	(115	)	$	64		$	7	$	(280	)	$	(273	)



	For the Six								For the Six
	Months Ended								Months Ended
	June 30, 2020								June 30, 2019
	Transfers		Transfers						Transfers		Transfers
	Into		Out of						Into		Out of
	Level 3		Level 3			Total			Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	254	$	(162	)	$	92		$	85	$	(171	)	$	(86	)
RMBS		1		(10	)		(9	)		-		(7	)		(7	)
ABS		20		(123	)		(103	)		-		(223	)		(223	)
Hybrid and redeemable preferred
securities		18		-			18			-		-			-
Trading securities		33		(2	)		31			5		(128	)		(123	)
Total, net	$	326	$	(297	)	$	29		$	90	$	(529	)	$	(439	)

Fair Value Inputs Quantitative Information



											Weighted
											Average
	Fair			Valuation	Significant	Assumption or					Input
	Value			Technique	Unobservable Inputs	Input Ranges					Range ⁽¹⁾
Assets
Investments:
Fixed maturity AFS and
trading securities:
Corporate bonds	$	2,933		Discounted cash flow	Liquidity/duration adjustment ⁽²⁾	0.1	%	-	79.9	%	2.8	%
Foreign government
bonds		47		Discounted cash flow	Liquidity/duration adjustment ⁽²⁾	6.2	%	-	9.0	%	7.8	%
ABS		21		Discounted cash flow	Liquidity/duration adjustment ⁽²⁾	4.7	%	-	4.7	%	4.7	%
Equity securities		22		Discounted cash flow	Liquidity/duration adjustment ⁽²⁾	4.5	%	-	6.4	%	6.0	%
Other assets – GLB ceded
embedded derivatives		571		Discounted cash flow	Long-term lapse rate ⁽³⁾	1	%	-	30	%	⁽¹⁰⁾
					Utilization of guaranteed withdrawals⁽⁴⁾	85	%	-	100	%	94	%
					Claims utilization factor ⁽⁵⁾	60	%	-	100	%	⁽¹⁰⁾
					Premiums utilization factor ⁽⁵⁾	80	%	-	115	%	⁽¹⁰⁾
					NPR ⁽⁶⁾	0.02	%	-	0.28	%	0.20	%
					Mortality rate ⁽⁷⁾				⁽⁹⁾		⁽¹⁰⁾
					Volatility ⁽⁸⁾	1	%	-	28	%	14.53	%

Indexed annuity ceded
embedded derivatives		664		Discounted cash flow	Lapse rate ⁽³⁾	1	%	-	9	%	⁽¹⁰⁾
					Mortality rate ⁽⁷⁾				⁽⁹⁾		⁽¹⁰⁾
Liabilities
Future contract benefits –
indexed annuity and IUL
contracts embedded
derivatives	$	(2,272	)	Discounted cash flow	Lapse rate ⁽³⁾	1	%	-	9	%	⁽¹⁰⁾
					Mortality rate ⁽⁷⁾				⁽⁹⁾		⁽¹⁰⁾
Other liabilities –
GLB direct embedded
derivatives		(3,086	)	Discounted cash flow	Long-term lapse rate ⁽³⁾	1	%	-	30	%	⁽¹⁰⁾
					Utilization of guaranteed withdrawals ⁽⁴⁾	85	%	-	100	%	94	%
					Claims utilization factor ⁽⁵⁾	60	%	-	100	%	⁽¹⁰⁾
					Premiums utilization factor ⁽⁵⁾	80	%	-	115	%	⁽¹⁰⁾
					NPR ⁽⁶⁾	0.02	%	-	0.28	%	0.20	%
					Mortality rate ⁽⁷⁾				⁽⁹⁾		⁽¹⁰⁾
					Volatility ⁽⁸⁾	1	%	-	28	%	14.53	%

⁽¹⁾Unobservable inputs were weighted by the relative fair value of the instruments, unless otherwise noted.

⁽²⁾The liquidity/duration adjustment input represents an estimated market participant composite of adjustments attributable to liquidity premiums, expected durations, structures and credit quality that would be applied to the market observable information of an investment.

⁽³⁾The lapse rate input represents the estimated probability of a contract surrendering during a year, and thereby forgoing any future benefits. The range for indexed annuity and IUL contracts represents the lapse rates during the surrender charge period.

⁽⁴⁾The utilization of guaranteed withdrawals input represents the estimated percentage of contract holders that utilize the guaranteed withdrawal feature.

⁽⁵⁾The utilization factors are applied to the present value of claims or premiums, as appropriate, in the GLB reserve calculation to estimate the impact of inefficient withdrawal behavior, including taking less than or more than the maximum guaranteed withdrawal.

⁽⁶⁾The NPR input represents the estimated additional credit spread that market participants would apply to the market observable discount rate when pricing a contract. The NPR input was weighted by the absolute value of the sensitivity of the reserve to the NPR assumption.

⁽⁷⁾The mortality rate input represents the estimated probability of when an individual belonging to a particular group, categorized according to age or some other factor such as gender, will die.

⁽⁸⁾The volatility input represents overall volatilities assumed for the underlying variable annuity funds, which include a mixture of equity and fixed-income assets. Fair value of the variable annuity GLB embedded derivatives would increase if higher volatilities were used for valuation. Volatility assumptions vary by fund due to the benchmarking of different indices. The volatility input was weighted by the relative account value assigned to each index.

⁽⁹⁾The mortality rate is based on a combination of company and industry experience, adjusted for improvement factors.

⁽¹⁰⁾A weighted average input range is not a meaningful measurement for lapse rate, utilization factors or mortality rate.