INVESTMENTS (Tables)

9 Months Ended

Sep. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Fixed Maturities, Available-for-sale Securities

The following tables set forth the composition of fixed maturity securities (excluding investments classified as trading) for the Predecessor Company:

	Predecessor Company
	December 31, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	654	$	74	$	1	$	—	$	727
Obligations of U.S. states and their political subdivisions	281		15		—		—		296
Foreign government bonds	106		9		1		—		114
U.S. public corporate securities	2,345		134		18		—		2,461
U.S. private corporate securities	1,635		24		14		1		1,644
Foreign public corporate securities	793		11		9		—		795
Foreign private corporate securities	920		5		34		—		891
Asset-backed securities(1)	1,058		5		1		—		1,062
Commercial mortgage-backed securities	692		22		8		—		706
Residential mortgage-backed securities(2)	72		3		—		—		75
Total fixed maturities, available-for-sale	$	8,556	$	302	$	86	$	1	$	8,771

(1)Includes credit-tranched securities collateralized by loan obligations, auto loans, education loans, equipment leases and sub-prime mortgages.

(2)Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.

Gross Unrealized Losses on Fixed Maturity Securities

The following tables set forth the fair value and gross unrealized losses on available-for-sale fixed maturity securities without an allowance for credit losses aggregated by investment category and length of time that individual fixed maturity securities had been in a continuous unrealized loss position for the Predecessor Company:

	Predecessor Company
	December 31, 2021
	Less Than Twelve Months				Twelve Months or More				Total
	Fair Value		Gross   Unrealized  Losses		Fair Value		Gross   Unrealized  Losses		Fair Value		Gross   Unrealized  Losses
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	74	$	1	$	—	$	—	$	74	$	1
Obligations of U.S. states and their political subdivisions	5		—		—		—		5		—
Foreign government bonds	13		1		7		—		20		1
U.S. public corporate securities	696		12		153		6		849		18
U.S. private corporate securities	855		14		—		—		855		14
Foreign public corporate securities	522		8		50		1		572		9
Foreign private corporate securities	689		34		—		—		689		34
Asset-backed securities	499		1		—		—		499		1
Commercial mortgage-backed securities	157		5		75		3		232		8
Residential mortgage-backed securities	6		—		—		—		6		—
Total fixed maturities, available-for-sale	$	3,516	$	76	$	285	$	10	$	3,801	$	86

Sources of Fixed Maturity Proceeds, Realized Investment Gains (Losses), and Losses on Impairments

The following table sets forth the sources of fixed maturity proceeds and related investment gains (losses), as well as losses on write-downs and the allowance for credit losses of fixed maturities, for the Predecessor Company:

	Predecessor Company
	Three months ended September 30		Nine months ended September 30
	2021
	(in millions)
Fixed maturities, available-for-sale:
Proceeds from sales(1)	$	216	$	8,009
Proceeds from maturities/prepayments	196		607
Gross investment gains on sales and maturities	157		1,296
Gross investment losses on sales and maturities	(14)		(75)
Write-downs recognized in earnings (2)	—		(23)
(Addition to) release of allowance for credit losses	(2)		(2)

(1)Includes $(243) million of non-cash related proceeds due to the timing of trade settlements for the nine months ended September 30, 2021.

(2)Amounts represent write-downs on securities actively marketed for sale.

The following tables set forth the activity in the allowance for credit losses for fixed maturity securities, for the Predecessor Company:

	Predecessor Company
	Three Months Ended March 31, 2022
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Bonds		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	—	$	—	$	1	$	—	$	—	$	—	$	1
Additions to allowance for credit losses not previously recorded	—		—		—		—		—		—		—
Reductions for securities sold during the period	—		—		—		—		—		—		—
Additions on securities with previous allowance	—		—		—		—		—		—		—
Balance, end of period	$	—	$	—	$	1	$	—	$	—	$	—	$	1

	Predecessor Company
	Three Months Ended September 30, 2021
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Bonds		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Additions to allowance for credit losses not previously recorded	—		—		2		—		—		—		2
Reductions for securities sold during the period	—		—		—		—		—		—		—
Reductions on securities with previous allowance	—		—		—		—		—		—		—
Balance, end of period	$	—	$	—	$	2	$	—	$	—	$	—	$	2

	Predecessor Company
	Nine Months Ended September 30, 2021
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Bonds		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	—	$	—	$	1	$	—	$	—	$	—	$	1
Additions to allowance for credit losses not previously recorded	—		—		3		—		—		—		3
Reductions for securities sold during the period	—		—		(1)		—		—		—		(1)
Reductions on securities with previous allowance	—		—		(1)		—		—		—		(1)
Balance, end of period	$	—	$	—	$	2	$	—	$	—	$	—	$	2

Schedule of Participating Mortgage Loans

The following table sets forth the composition of “Commercial mortgage and other loans,” for the Predecessor Company:

	Predecessor Company
	December 31, 2021
	Amount (in millions)		% of Total
Commercial mortgage and agricultural property loans by property type:
Apartments/Multi-Family	$	385	25.5	%
Hospitality	17		1.1
Industrial	624		41.5
Office	196		13.0
Other	134		8.9
Retail	102		6.7
Total commercial mortgage loans	1,458		96.7	%
Agricultural property loans	51		3.3
Total commercial mortgage and agricultural property loans	1,509		100.0	%
Allowance for credit losses	(5)
Total net commercial mortgage and agricultural property loans	$	1,504

Allowance for Credit Losses

The following tables set forth the activity in the allowance for credit losses for commercial mortgage and other loans for the Predecessor Company:

	Predecessor Company
	Three Months Ended March 31,
	2022
	Commercial Mortgage Loans		Agricultural Property Loans		Total
	(in millions)
Allowance, beginning of period	$	5	$	—	$	5
Release of allowance for expected losses	(1)		—		(1)
Allowance, end of period	$	4	$	—	$	4

	Predecessor Company
	Three Months Ended September 30						Nine Months Ended September 30
	2021
	Commercial Mortgage Loans		Agricultural Property Loans		Total		Commercial Mortgage Loans		Agricultural Property Loans		Total
	(in millions)
Allowance, beginning of period	$	5	$	—	$	5	$	7	$	—	$	7
Addition to (release of) allowance for expected losses	(1)		—		(1)		(3)		—		(3)
Allowance, end of period	$	4	$	—	$	4	$	4	$	—	$	4

Financing Receivable Credit Quality Indicators

The following tables set forth key credit quality indicators based upon the recorded investment gross of allowance for credit losses, for the Predecessor Company:

	Predecessor Company
	December 31, 2021
	Amortized Cost by Origination Year
	2021		2020		2019		2018		2017		Prior		Total
	(in millions)
Commercial Mortgage Loans
Loan-to-Value Ratio:
0%-59.99%	$	150	$	—	$	21	$	7	$	93	$	232	$	503
60%-69.99%	389		33		10		11		39		28		510
70%-79.99%	317		48		17		—		21		21		424
80% or greater	—		—		—		—		—		21		21
Total	$	856	$	81	$	48	$	18	$	153	$	302	$	1,458
Debt Service Coverage Ratio:
Greater or Equal to 1.2x	$	856	$	81	$	48	$	7	$	120	$	295	$	1,407
1.0 - 1.2x	—		—		—		11		—		—		11
Less than 1.0x	—		—		—		—		33		7		40
Total	$	856	$	81	$	48	$	18	$	153	$	302	$	1,458
Agricultural Property Loans
Loan-to-Value Ratio:
0%-59.99%	$	40	$	1	$	—	$	—	$	3	$	7	$	51
60%-69.99%	—		—		—		—		—		—		—
70%-79.99%	—		—		—		—		—		—		—
80% or greater	—		—		—		—		—		—		—
Total	$	40	$	1	$	—	$	—	$	3	$	7	$	51
Debt Service Coverage Ratio:
Greater or Equal to 1.2x	$	40	$	1	$	—	$	—	$	3	$	3	$	47
1.0 - 1.2x	—		—		—		—		—		—		—
Less than 1.0x	—		—		—		—		—		4		4
Total	$	40	$	1	$	—	$	—	$	3	$	7	$	51

Other Invested Assets

The following table sets forth the composition of “Other invested assets,” as of the dates indicated.

	Successor Company		Predecessor Company
	September 30, 2022		December 31, 2021
	(in millions)
LPs/LLCs:
Equity method:
Private equity	$	14	$	19
Real estate-related	5		62
Subtotal equity method	19		81
Fair value:
Private equity	64		4
Real estate-related	—		6
Subtotal fair value	64		10
Total LPs/LLCs	83		91
Derivative instruments	265		3
Other	82		12
Total other invested assets	$	430	$	106

Accrued Investment Income

The following table sets forth the composition of “Accrued investment income,” as of the dates indicated:

	Successor Company		Predecessor Company
	September 30, 2022		December 31, 2021
	(in millions)
Fixed maturity securities	$	45	$	58
Commercial mortgage and other loans	—		3
Other invested assets	6		—
Short-term investments and cash equivalents	5		—
Total accrued investment income	$	56	$	61

Net Investment Income

The following table sets forth “Net investment income” by investment type, for the periods indicated:

	Successor Company				Predecessor Company
	Three Months Ended September 30		Six Months Ended September 30		Three Months Ended March 31		Three Months Ended September 30		Nine Months Ended September 30
	2022						2021
	(in millions)
Fixed maturities securities (1)	$	76	$	156	$	61	$	82	$	308
Equity securities	1		2		1		1		3
Secured receivable	7		18		—		—		—
Commercial mortgage and other loans	—		—		11		14		46
Other invested assets	10		14		29		11		50
Short-term investments and cash equivalents	3		5		1		1		1
Gross investment income	97		195		103		109		408
Less: investment expenses	(5)		(6)		(4)		(8)		(22)
Net investment income	$	92	$	189	$	99	$	101	$	386

(1)Includes fixed maturity securities classified as available-for-sale and trading for the three months ended March 31, 2022 and the three and nine months ended, September 30, 2021.

Schedule of Realized Gain (Loss)

The following table sets forth “Investment gains (losses), net” by investment type, for the periods indicated:

	Successor Company				Predecessor Company
	Three Months Ended September 30		Six Months Ended September 30		Three Months Ended March 31		Three Months Ended September 30		Nine Months Ended September 30
	2022						2021
	(in millions)
Fixed maturity securities (1)	$	(458)	$	(1,102)	$	(21)	$	141	$	1,197
Secured receivable	(8)		(59)		—		—		—
Commercial mortgage and other loans	—		—		—		28		28
Derivatives	24		(560)		502		4,906		6,139
Other invested assets and equity securities	(13)		(32)		—		6		9
Investment gains (losses), net	$	(455)	$	(1,753)	$	481	$	5,081	$	7,373

(1)For the Predecessor Company, includes fixed maturity securities classified as available-for-sale and excludes fixed maturity securities classified as trading.

Net Unrealized Gains and (Losses) on Investments

The following table sets forth net unrealized gains (losses) on investments, as of the dates indicated:

	Predecessor Company
	December 31, 2021
	(in millions)
Fixed maturity securities, available-for-sale without an allowance	$	216
Derivatives designated as cash flow hedges(1)	25
Net unrealized gains on investments	$	241

(1)For more information on cash flow hedges for the Predecessor Company, see Note 6.

Repurchase Agreements and Securities Lending

In the normal course of business, FLIAC sells securities under agreements to repurchase and enters into securities lending transactions. These balances are recorded within Other liabilities in the unaudited interim consolidated statements of financial position.

The following table sets forth the remaining contractual maturities of the Successor Company's outstanding repurchase agreements by security type.

	Successor Company
	September 30, 2022
	Remaining Contractual Maturities of the Agreements
	Overnight & Continuous		Up to 30 days		30-90 days		Total
	(in millions)
U.S. corporate public securities	$	—	$	—	$	200	$	200

The following table sets forth the remaining contractual maturities of the Successor Company's cash collateral received for securities loaned by security type:

	Successor Company
	September 30, 2022
	Remaining Contractual Maturities of the Agreements
	Overnight & Continuous		Up to 30 days		30-90 days		Total
	(in millions)
Equity securities	$	169	$	—	$	—	$	169