REINSURANCE AGREEMENTS

9 Months Ended

Sep. 30, 2018

Insurance [Abstract]

Reinsurance Agreements

REINSURANCE AGREEMENTS

Effective February 1, 2018, the Company entered into a coinsurance reinsurance agreement (the “Coinsurance Agreement”) to cede 90% of its single premium deferred annuities (SPDA) products issued between 1978-2001 and its Guaranteed Growth Annuity (GGA) single premium deferred annuity products issued between 2001-2014. As a result of this agreement, the Company transferred securities with a market value of $604 million and cash of $31 million to equal the statutory reserves of approximately $635 million. As the risks transferred by the Company to the reinsurer under the Coinsurance Agreement are not considered insurance risks and therefore do not qualify for reinsurance accounting, the Company applied deposit accounting. Accordingly, the Company recorded the transferred assets of $635 million as a deposit asset recorded in Other assets, net of the ceding commissions paid to the reinsurer.