Segment Information

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company’s four reporting segments are Advice & Wealth Management, Asset Management, Retirement & Protection Solutions and Corporate & Other.

The accounting policies of the segments are the same as those of the Company, except for operating adjustments defined below, the method of capital allocation, the accounting for gains (losses) from intercompany revenues and expenses and not providing for income taxes on a segment basis.

Management uses segment adjusted operating measures in goal setting, as a basis for determining employee compensation and in evaluating performance on a basis comparable to that used by some securities analysts and investors. Consistent with GAAP accounting guidance for segment reporting, adjusted operating earnings is the Company’s measure of segment performance. Adjusted operating earnings should not be viewed as a substitute for GAAP pretax income. The Company believes the presentation of segment adjusted operating earnings, as the Company measures it for management purposes, enhances the understanding of its business by reflecting the underlying performance of its core operations and facilitating a more meaningful trend analysis.

Effective in the third quarter of 2021, management has excluded the impacts of block transfer reinsurance transactions from the adjusted operating measures.

Adjusted operating earnings is defined as adjusted operating net revenues less adjusted operating expenses. Adjusted operating net revenues and adjusted operating expenses exclude net realized investment gains or losses (net of reinsurance accrual); the market impact on non-traditional long-duration products (including variable and fixed deferred annuity contracts and UL insurance contracts), net of hedges and reinsurance accrual; mean reversion related impacts (the impact on VUL products for the difference between assumed and updated separate account investment performance on the reinsurance accrual and additional insurance benefit reserves); the market impact of hedges to offset interest rate and currency changes on unrealized gains or losses for certain investments; block transfer reinsurance transaction impacts; gain or loss on disposal of a business that is not considered discontinued operations; integration and restructuring charges; and the impact of consolidating CIEs. The market impact on non-traditional long-duration products includes changes in market risk benefits and embedded derivative values caused by changes in financial market conditions, net of changes in economic hedge values and unhedged items including the difference between assumed and actual underlying separate account investment performance, fixed income credit exposures, transaction costs and certain policyholder contract elections. The market impact also includes certain valuation adjustments made in accordance with FASB Accounting Standards Codification 820, Fair Value Measurements and Disclosures, including the impact on embedded derivative values of discounting projected benefits to reflect a current estimate of the Company’s life insurance subsidiary’s nonperformance spread.

Concurrent with the adoption of ASU 2018-12, management no longer excludes adjustments for DAC, DSIC and unearned revenue amortization. Amortization of DAC, DSIC, and unearned revenue for long-duration contracts are no longer impacted by markets and are now amortized on a constant-level basis.

The following tables summarize selected financial information by segment and reconcile segment totals to those reported on the consolidated financial statements:

	March 31, 2023		December 31, 2022
	(in millions)
Advice & Wealth Management	$	39,099	$	35,132
Asset Management	7,768		7,967
Retirement & Protection Solutions	102,337		98,901
Corporate & Other	17,436		16,852
Total assets	$	166,640	$	158,852

	Three Months Ended March 31,
	2023		2022
	(in millions)
Adjusted operating net revenues:
Advice & Wealth Management	$	2,265	$	2,042
Asset Management	799		1,017
Retirement & Protection Solutions	824		768
Corporate & Other	126		116
Elimination of segment revenues (1)	(316)		(352)
Total segment adjusted operating net revenues	3,698		3,591
Net realized gains (losses)	3		16
Revenue attributable to consolidated investment entities	41		17
Market impact on non-traditional long-duration products, net	—		1
Total net revenues per consolidated statements of operations	$	3,742	$	3,625

(1) Represents the elimination of intersegment revenues recognized for the three months ended March 31, 2023 and 2022 in each segment as follows: Advice & Wealth Management ($201 million and $228 million, respectively); Asset Management ($17 million and $12 million, respectively); Retirement & Protection Solutions ($102 million and $112 million, respectively); and Corporate & Other ($(4) million and nil, respectively).

	Three Months Ended March 31,
	2023		2022
	(in millions)
Adjusted operating earnings:
Advice & Wealth Management	$	693	$	440
Asset Management	165		285
Retirement & Protection Solutions	194		175
Corporate & Other	(74)		(82)
Total segment adjusted operating earnings	978		818
Net realized gains (losses)	3		16
Net income (loss) attributable to consolidated investment entities	—		2
Market impact on non-traditional long-duration products, net	(475)		180
Integration and restructuring charges	(10)		(10)
Pretax income per consolidated statements of operations	$	496	$	1,006