SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

FLIAC has two reportable segments, which we refer to as the "Retained Business" and the "Ceded Business."

The Retained Business consists of variable annuity products with guaranteed lifetime withdrawal benefit features as well as smaller blocks of variable annuity products with certain other living benefit and death benefit features. The Retained Business also includes variable universal life and fixed payout annuity products. The Retained Business is actively managed by FLIAC management and the Successor Company retains the full economic benefits and risks.

The Ceded Business represents certain business (primarily registered index-linked annuities and fixed annuities, which includes fixed indexed and fixed deferred annuities, and other variable annuities) where 100 percent of the assets and liabilities have been fully ceded to Prudential Insurance and Pruco Life under existing coinsurance and modified coinsurance agreements. At June 30, 2023 and December 31, 2022, we had a modified coinsurance payable of $1,678 million and $1,745 million, respectively, equal to the assets held in the Ceded Business, and are included in the net modified coinsurance receivable/payable. Information prior to acquisition has not been revised for the segment presentation and is not comparable following the election of push-down accounting as of April 1, 2022.

The following is the Consolidated Statement of Financial Position by segment:

	June 30, 2023
	Retained Business		Ceded Business		Total
	(in millions)
ASSETS
Total investments	$	4,486	$	1,388	$	5,874
Cash and cash equivalents	351		298		649
Accrued investment income	45		10		55
Reinsurance recoverables	—		200		200
Deposit asset	—		476		476
Goodwill	93		—		93
Income tax	46		—		46
Other assets	70		13		83
Separate account assets	21,981		2,084		24,065
TOTAL ASSETS	$	27,072	$	4,469	$	31,541
LIABILITIES AND EQUITY
LIABILITIES
Insurance liabilities	$	2,711	$	2,273	$	4,984
Net modified coinsurance payable	—		81		81
Other liabilities	774		31		805
Separate account liabilities	21,981		2,084		24,065
TOTAL LIABILITIES	25,466		4,469		29,935
EQUITY	1,606		—		1,606
TOTAL LIABILITIES AND EQUITY	$	27,072	$	4,469	$	31,541

    

	December 31, 2022
	Retained Business		Ceded Business		Total
	(in millions)
ASSETS
Total investments	$	4,257	$	1,630	$	5,887
Cash and cash equivalents	433		439		872
Accrued investment income	41		11		52
Reinsurance recoverables	—		235		235
Net modified coinsurance receivable	—		18		18
Deposit asset	—		607		607
Goodwill	93		—		93
Income tax	50		—		50
Other assets	113		14		127
Separate account assets	21,558		2,043		23,601
TOTAL ASSETS	$	26,545	$	4,997	$	31,542
LIABILITIES AND EQUITY
LIABILITIES
Insurance liabilities	$	2,941	$	2,605	$	5,546
Other liabilities	459		349		808
Separate account liabilities	21,558		2,043		23,601
TOTAL LIABILITIES	24,958		4,997		29,955
EQUITY	1,587		—		1,587
TOTAL LIABILITIES AND EQUITY	$	26,545	$	4,997	$	31,542

The following is comprehensive income by segment:

	Three Months Ended June 30, 2023
	Retained Business		Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	7	$	—	$	7
Policy charges and fee income	115		—		115
Net investment income	58		20		78
Asset management and service fees	23		—		23
Other income	2		1		3
Investment gains (losses), net	(402)		115		(287)
TOTAL REVENUES	(197)		136		(61)
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	(391)		136		(255)
Commission expense	23		—		23
General, administrative and other expenses	16		—		16
TOTAL BENEFITS AND EXPENSES	(352)		136		(216)
INCOME FROM OPERATIONS BEFORE INCOME TAXES	155		—		155
Income tax expense	25		—		25
NET INCOME	$	130	$	—	$	130
Other comprehensive loss, before tax:
Changes in own-credit risk related to insurance liabilities	(115)		—		(115)
Less: Income tax benefit	(25)		—		(25)
Other comprehensive loss, net of taxes	(90)		—		(90)
COMPREHENSIVE INCOME	$	40	$	—	$	40

	Six Months Ended June 30, 2023
	Retained Business		Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	14	$	—	$	14
Policy charges and fee income	232		—		232
Net investment income	114		40		154
Asset management and service fees	45		—		45
Other income	3		1		4
Investment gains (losses), net	(372)		250		(122)
TOTAL REVENUES	36		291		327
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	(206)		291		85
Commission expense	46		—		46
General, administrative and other expenses	34		—		34
TOTAL BENEFITS AND EXPENSES	(126)		291		165
INCOME FROM OPERATIONS BEFORE INCOME TAXES	162		—		162
Income tax expense	25		—		25
NET INCOME	$	137	$	—	$	137
Other comprehensive loss, before tax:
Changes in own-credit risk related to insurance liabilities	(93)		—		(93)
Less: Income tax benefit	(20)		—		(20)
Other comprehensive loss, net of taxes	(73)		—		(73)
COMPREHENSIVE INCOME	$	64	$	—	$	64

	Three Months Ended June 30, 2022
	Retained Business			Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	3		$	—	$	3
Policy charges and fee income	130			—		130
Net investment income	35			62		97
Asset management and service fees	22			—		22
Other income	—			1		1
Investment losses, net	(108)			(1,190)		(1,298)
TOTAL REVENUES	82			(1,127)		(1,045)
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	257		—	(1,127)		(870)
Commission expense	18			—		18
General, administrative and other expenses	38			—		38
TOTAL BENEFITS AND EXPENSES	313			(1,127)		(814)
LOSS FROM OPERATIONS BEFORE INCOME TAXES	(231)			—		(231)
Income tax benefit	(51)			—		(51)
NET LOSS	$	(180)		$	—	$	(180)
Other comprehensive income, before tax:
Changes in own-credit risk related to insurance liabilities	245			—		245
Less: Income tax expense	51			—		51
Other comprehensive income, net of taxes	194			—		194
COMPREHENSIVE INCOME	$	14		$	—	$	14