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Deferred Acquisition Costs and Deferred Sales Inducement Costs
 12 Months Ended
Dec. 31, 2017
Deferred Charges, Insurers [Abstract]  
Deferred acquisition costs and deferred sales inducement costs [Text Block]
Deferred Acquisition Costs and Deferred Sales Inducement Costs
In the third quarter of the year, management updated market-related inputs and implemented model changes related to our living benefit valuation. In addition, management conducted its annual review of life insurance and annuity valuation assumptions relative to current experience and management expectations including modeling changes. These aforementioned changes are collectively referred to as unlocking. The impact of unlocking to DAC for the year ended December 31, 2017 primarily reflected improved persistency and mortality on life insurance contracts and a correction related to a variable annuity model assumption partially offset by updates to market-related inputs to the living benefit valuation. The impact of unlocking to DAC for the year ended December 31, 2016 primarily reflected low interest rates that more than offset benefits from persistency on annuity contracts without living benefits. In addition, the Company’s review of its closed LTC business in the prior year resulted in the write-off of DAC, which was included in the impact of unlocking. The impact of unlocking to DAC for the year ended December 31, 2015 primarily reflected the difference between the Company’s previously assumed interest rates versus the low interest rate environment partially offset by improved persistency.
The balances of and changes in DAC were as follows:
 
2017
 
2016
 
2015
 
(in millions)
 
Balance at January 1
$
2,648

 
$
2,730

 
$
2,613

 
Capitalization of acquisition costs
302

 
360

(1) 
361

 
Amortization, excluding the impact of valuation assumptions review
(279
)
 
(334
)
 
(348
)
 
Amortization, impact of valuation assumptions review
12

 
(81
)
(2) 
(6
)
 
Impact of change in net unrealized securities (gains) losses
(7
)
 
(27
)
 
110

 
Balance a December 31
$
2,676

 
$
2,648

 
$
2,730

 

(1) Includes a $27 million benefit related to the write-off of the deferred reinsurance liability in connection with the loss recognition on LTC business. The benefit was reported in Distribution expenses on the Consolidated Statements of Operations.
(2) Includes a $58 million expense related to the loss recognition on LTC business.
The balances of and changes in DSIC, which is included in other assets, were as follows:
 
2017
 
2016
 
2015
(in millions)
Balance at January 1
$
302

 
$
335

 
$
362

Capitalization of sales inducement costs
4

 
5

 
4

Amortization, excluding the impact of valuation assumptions review
(35
)
 
(42
)
 
(52
)
Amortization, impact of valuation assumptions review
(1
)
 
4

 
1

Impact of change in net unrealized securities (gains) losses
6

 
—

 
20

Balance at December 31
$
276

 
$
302

 
$
335