Equity

9 Months Ended

Sep. 30, 2021

EQUITY

Accumulated Other Comprehensive Income (Loss)

AOCI represents the cumulative OCI items that are reported separate from net income and detailed on the Unaudited Interim Statements of Operations and Comprehensive Income (Loss). The balance of and changes in each component of AOCI as of and for the nine months ended September 30, 2021 and 2020 are as follows:


	Accumulated Other Comprehensive Income (Loss)
	Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses)(1)		Total Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance, December 31, 2020	$	(708)	$	1,533,767	$	1,533,059
Change in OCI before reclassifications	(117)		(354,151)		(354,268)
Amounts reclassified from AOCI	0		(1,225,663)		(1,225,663)
Income tax benefit (expense)	25		331,761		331,786
Balance, September 30, 2021	$	(800)	$	285,714	$	284,914


	Accumulated Other Comprehensive Income (Loss)
	Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses)(1)		Total Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance, December 31, 2019	$	(934)	$	429,546	$	428,612
Change in OCI before reclassifications	(154)		1,586,843		1,586,689
Amounts reclassified from AOCI	0		(26,350)		(26,350)
Income tax benefit (expense)	32		(327,704)		(327,672)
Balance, September 30, 2020	$	(1,056)	$	1,662,335	$	1,661,279

(1)Includes cash flow hedges of $15 million and $(43) million as of September 30, 2021 and December 31, 2020, respectively, and $23 million and $0 million as of September 30, 2020 and December 31, 2019, respectively.

Reclassifications out of Accumulated Other Comprehensive Income (Loss)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
	(in thousands)
Amounts reclassified from AOCI(1)(2):
Net unrealized investment gains (losses):
Cash flow hedges—Currency/ Interest rate(3)	$	10,792	$	(9,602)	$	29,094	$	11,188
Net unrealized investment gains (losses) on available-for-sale securities	140,824		73		1,196,569		15,162
Total net unrealized investment gains (losses)(4)	151,616		(9,529)		1,225,663		26,350
Total reclassifications for the period	$	151,616	$	(9,529)	$	1,225,663	$	26,350

(1)All amounts are shown before tax.

(2)Positive amounts indicate gains/benefits reclassified out of AOCI. Negative amounts indicate losses/costs reclassified out of AOCI.

(3)See Note 4 for additional information on cash flow hedges.

(4)See table below for additional information on unrealized investment gains (losses), including the impact on DAC and other costs and future policy benefits and other liabilities.

Net Unrealized Investment Gains (Losses)

Net unrealized investment gains (losses) on available-for-sale fixed maturity securities and certain other invested assets and other assets are included in the Company’s Unaudited Interim Statements of Financial Position as a component of AOCI. Changes in these amounts include reclassification adjustments to exclude from OCI those items that are included as part of “Net income” for a period that had been part of OCI in earlier periods. The amounts for the periods indicated below, split between amounts related to net unrealized investment gains (losses) on available-for-sale fixed maturity securities on which an allowance for credit losses has been recognized, and all other net unrealized investment gains (losses), are as follows:


	Net Unrealized Gains (Losses) on Investments on Available-for-Sale Fixed Maturity Securities on which an allowance for credit losses has been recognized		Net Unrealized Gains (Losses) on All Other Investments(1)		DAC and Other Costs(2)		Future Policy Benefits and Other Liabilities(3)		Income Tax Benefit (Expense)		Accumulated Other Comprehensive Income (Loss) Related To Net Unrealized Investment Gains (Losses)
	(in thousands)
Balance, December 31, 2020	$	2	$	2,369,107	$	(363,429)	$	(63,159)	$	(408,754)	$	1,533,767
Net investment gains (losses) on investments arising during the period	2,017		(742,086)		0		0		155,611		(584,458)
Reclassification adjustment for (gains) losses included in net income	(1,991)		(1,223,672)		0		0		257,295		(968,368)
Reclassification due to allowance for credit losses recorded during the period	125		(125)		0		0		0		0


Impact of net unrealized investment (gains) losses	0		0		325,247		60,671		(81,145)		304,773
Balance, September 30, 2021	$	153	$	403,224	$	(38,182)	$	(2,488)	$	(76,993)	$	285,714

(1)Includes cash flow hedges. See Note 4 for information on cash flow hedges.

(2)"Other costs" primarily includes reinsurance recoverables, DSI and VOBA.

(3)"Other liabilities" primarily includes reinsurance payables and deferred reinsurance gains.