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Investment Contract Liabilities
 12 Months Ended
Dec. 31, 2020
Text block [abstract]  
Investment Contract Liabilities
Note 7    Investment Contract Liabilities
Investment contract liabilities are contractual obligations that do not contain significant insurance risk. Those contracts are measured either at fair value or at amortized cost.
(a) Investment contract liabilities measured at fair value
Investment contract liabilities measured at fair value include certain investment savings and pension products sold primarily in Hong Kong and mainland China. The following table presents the movement in investment contract liabilities measured at fair value.
 
For the years ended December 31,
 
2020
  2019 
Balance, January 1
 
$
789
 
 $782 
New policies
 
 
180
 
  66 
Changes in market conditions
 
 
90
 
  62 
Redemptions, surrenders and maturities
 
 
  (108
) 
  (86) 
Impact of changes in foreign exchange rates
 
 
(19
) 
  (35) 
Balance, December 31
 
$
932
 
 $    789 
(b) Investment contract liabilities measured at amortized cost
Investment contract liabilities measured at amortized cost include several fixed annuity products sold in
the U.S. and
 
Canada that provide guaranteed income payments for a contractually determined period and are not contingent on survivorship.
The following table presents carrying and fair values of investment contract liabilities measured at amortized cost.
 
  2020     2019 
As at December 31,
 
Amortized
cost, gross of
reinsurance
ceded
(1)
  Fair value     
Amortized
cost, gross of
reinsurance
ceded
(1)
  Fair value 
U.S. fixed annuity products
 
$
  1,361
 
 
$
  1,680
 
         $  1,248  $  1,482 
Canadian fixed annuity products
 
 
995
 
 
 
1,086
 
      1,067   1,158 
Investment contract liabilities
 
$
2,356
 
 
$
2,766
 
         $  2,315  $2,640 
 
(1)
As at December 31, 2020, investment contract liabilities with carrying value and fair value of $67 and $76, respectively (2019 – $93 and $103, respectively), were reinsured by the Company. The net carrying value and fair value of investment contract liabilities were $2,289 and $2,690 (2019 – $2,222 and $2,537), respectively.
 
The changes in investment contract liabilities measured at amortized cost was a result of the following business activities.
 
For the years ended December 31,
 
2020
  2019 
Balance, January 1
 
$
  2,315
 
 $  2,483 
Policy deposits
 
 
202
 
  2 
Interest
 
 
61
 
  62 
Withdrawals
 
 
(194
) 
  (182) 
Fees
 
 
(1
) 
  (3) 
Other
 
 
–
 
  17 
Impact of changes in foreign exchange rates
 
 
(27
) 
  (64) 
Balance, December 31
 
$
2,356
 
 $2,315 
Carrying value of fixed annuity products is amortized at a rate that exactly discounts the projected actual cash flows to the net carrying amount of the liability at the date of issue.
Fair value of fixed annuity products is determined by projecting cash flows according to the contract terms and discounting the cash flows at current market rates adjusted for the Company’s own credit standing. As at December 31, 2020 and 2019,
fair value of 
all investment contract 
liabilities was determined using
 Level 2
valuation techniques
.
(c) Investment contracts contractual obligations
As at December 31, 2020, the Company’s contractual obligations and commitments relating to the investment contracts are as follows.
 
Payments due by period
  Less than
1 year		   
1 to 3
years
   
3 to 5
years
   Over 5
years		   Total 
Investment contract liabilities
(1)
  
$
  297
 
  
$
  514
 
  
$
  520
 
  
$
  4,220
 
  
$
  5,551
 
 
(1)
Due to the nature of the products, the timing of net cash flows may be before contract maturity. Cash flows are undiscounted.