Segment Information

12 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Segment Information

2. Segment Information

MetLife is organized into five segments: U.S.; Asia; Latin America; EMEA; and MetLife Holdings. In addition, the Company reports certain of its results of operations in Corporate & Other.

U.S.

The U.S. segment offers a broad range of protection products and services aimed at serving the financial needs of customers throughout their lives. These products are sold to corporations and their respective employees, other institutions and their respective members, as well as individuals. The U.S. segment is organized into three businesses: Group Benefits, Retirement and Income Solutions (“RIS”) and Property & Casualty.

•The Group Benefits business offers products such as term, variable and universal life insurance, dental, group and individual disability, vision and accident & health insurance.

•The RIS business offers a broad range of life and annuity-based insurance and investment products, including stable value and pension risk transfer products, institutional income annuities, structured settlements, and capital markets investment products, as well as solutions for funding postretirement benefits and company-, bank- and trust-owned life insurance.

•The Property & Casualty business offers personal lines of property and casualty insurance, including private passenger automobile and homeowners’ insurance. See Note 3 for information on the pending disposition.

Asia

The Asia segment offers a broad range of products to both individuals and corporations, as well as to other institutions, and their respective employees, which include life insurance, accident & health insurance and retirement and savings.

Latin America

The Latin America segment offers a broad range of products to both individuals and corporations, as well as to other institutions, and their respective employees, which include life insurance, retirement and savings, accident & health insurance and credit insurance.

EMEA

The EMEA segment offers products to individuals, corporations, other institutions, and their respective employees, which include life insurance, accident & health insurance, retirement and savings and credit insurance.

MetLife Holdings

The MetLife Holdings segment consists of operations relating to products and businesses that the Company no longer actively markets in the United States. These include variable, universal, term and whole life insurance, variable, fixed and index-linked annuities and long-term care insurance.

Corporate & Other

Corporate & Other contains various start-up, developing and run-off businesses. Also included in Corporate & Other are: the excess capital, as well as certain charges and activities, not allocated to the segments (including external integration and disposition costs, internal resource costs for associates committed to acquisitions and dispositions and enterprise-wide strategic initiative restructuring charges), interest expense related to the majority of the Company’s outstanding debt, expenses associated with certain legal proceedings and income tax audit issues, the elimination of intersegment amounts (which generally relate to affiliated reinsurance, investment expenses and intersegment loans, bearing interest rates commensurate with related borrowings), and the Company’s investment management business (through which the Company provides public fixed income, private capital and real estate investment solutions to institutional investors worldwide).

Financial Measures and Segment Accounting Policies

Adjusted earnings is used by management to evaluate performance and allocate resources. Consistent with GAAP guidance for segment reporting, adjusted earnings is also the Company’s GAAP measure of segment performance and is reported below. Adjusted earnings should not be viewed as a substitute for net income (loss). The Company believes the presentation of adjusted earnings, as the Company measures it for management purposes, enhances the understanding of its performance by highlighting the results of operations and the underlying profitability drivers of the business.

Adjusted earnings is defined as adjusted revenues less adjusted expenses, net of income tax.

The financial measures of adjusted revenues and adjusted expenses focus on the Company’s primary businesses principally by excluding the impact of market volatility, which could distort trends, and revenues and costs related to non-core products and certain entities required to be consolidated under GAAP. Also, these measures exclude results of discontinued operations under GAAP and other businesses that have been or will be sold or exited by MetLife but do not meet the discontinued operations criteria under GAAP and are referred to as divested businesses. Divested businesses also include the net impact of transactions with exited businesses that have been eliminated in consolidation under GAAP and costs relating to businesses that have been or will be sold or exited by MetLife that do not meet the criteria to be included in results of discontinued operations under GAAP. Adjusted revenues also excludes net investment gains (losses) and net derivative gains (losses). Adjusted expenses also excludes goodwill impairments.

The following additional adjustments are made to revenues, in the line items indicated, in calculating adjusted revenues:

•Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to net investment gains (losses) and net derivative gains (losses) and certain variable annuity GMIB fees (“GMIB fees”);

•Net investment income: (i) includes adjustments for earned income on derivatives and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment, (ii) excludes post-tax adjusted earnings adjustments relating to insurance joint ventures accounted for under the equity method, (iii) excludes certain amounts related to contractholder-directed equity securities, (iv) excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP and (v) includes distributions of profits from certain other limited partnership interests that were previously accounted for under the cost method, but are now accounted for at estimated fair value, where the change in estimated fair value is recognized in net investment gains (losses) under GAAP; and

•Other revenues is adjusted for settlements of foreign currency earnings hedges and excludes fees received in association with services provided under transition service agreements (“TSA fees”).

The following additional adjustments are made to expenses, in the line items indicated, in calculating adjusted expenses:

•Policyholder benefits and claims and policyholder dividends excludes: (i) amortization of basis adjustments associated with de-designated fair value hedges of future policy benefits, (ii) changes in the policyholder dividend obligation related to net investment gains (losses) and net derivative gains (losses), (iii) inflation-indexed benefit adjustments associated with contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments, (iv) benefits and hedging costs related to GMIBs (“GMIB costs”) and (v) market value adjustments associated with surrenders or terminations of contracts (“Market value adjustments”);

•Interest credited to policyholder account balances includes adjustments for earned income on derivatives and amortization of premium on derivatives that are hedges of policyholder account balances but do not qualify for hedge accounting treatment and excludes certain amounts related to net investment income earned on contractholder-directed equity securities;

•Amortization of DAC and VOBA excludes amounts related to: (i) net investment gains (losses) and net derivative gains (losses), (ii) GMIB fees and GMIB costs and (iii) Market value adjustments;

•Amortization of negative VOBA excludes amounts related to Market value adjustments;

•Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and

•Other expenses excludes: (i) noncontrolling interests, (ii) implementation of new insurance regulatory requirements costs, and (iii) acquisition, integration and other costs. Other expenses includes TSA fees.

Adjusted earnings also excludes the recognition of certain contingent assets and liabilities that could not be recognized at acquisition or adjusted for during the measurement period under GAAP business combination accounting guidance.

The tax impact of the adjustments mentioned above are calculated net of the U.S. or foreign statutory tax rate, which could differ from the Company’s effective tax rate. Additionally, the provision for income tax (expense) benefit also includes the impact related to the timing of certain tax credits, as well as certain tax reforms.

Set forth in the tables below is certain financial information with respect to the Company’s segments, as well as Corporate & Other, for the years ended December 31, 2020, 2019 and 2018 and at December 31, 2020 and 2019. The segment accounting policies are the same as those used to prepare the Company’s consolidated financial statements, except for adjusted earnings adjustments as defined above. In addition, segment accounting policies include the method of capital allocation described below.

Economic capital is an internally developed risk capital model, the purpose of which is to measure the risk in the business and to provide a basis upon which capital is deployed. The economic capital model accounts for the unique and specific nature of the risks inherent in the Company’s business.

The Company’s economic capital model, coupled with considerations of local capital requirements, aligns segment allocated equity with emerging standards and consistent risk principles. The model applies statistics-based risk evaluation principles to the material risks to which the Company is exposed. These consistent risk principles include calibrating required economic capital shock factors to a specific confidence level and time horizon while applying an industry standard method for the inclusion of diversification benefits among risk types. The Company’s management is responsible for the ongoing production and enhancement of the economic capital model and reviews its approach periodically to ensure that it remains consistent with emerging industry practice standards.

Segment net investment income is credited or charged based on the level of allocated equity; however, changes in allocated equity do not impact the Company’s consolidated net investment income, net income (loss) or adjusted earnings.

Net investment income is based upon the actual results of each segment’s specifically identifiable investment portfolios adjusted for allocated equity. Other costs are allocated to each of the segments based upon: (i) a review of the nature of such costs; (ii) time studies analyzing the amount of employee compensation costs incurred by each segment; and (iii) cost estimates included in the Company’s product pricing.

Year Ended December 31, 2020	U.S.		Asia		Latin America		EMEA		MetLife Holdings		Corporate & Other		Total		Adjustments		Total Consolidated
	(In millions)
Revenues
Premiums	$	27,265	$	6,571	$	2,265	$	2,259	$	3,600	$	22	$	41,982	$	52	$	42,034
Universal life and investment-type product policy fees	1,070		1,892		994		433		1,073		3		5,465		138		5,603
Net investment income	6,903		3,938		992		269		5,184		42		17,328		(211)		17,117
Other revenues	957		61		38		52		238		344		1,690		159		1,849
Net investment gains (losses)	—		—		—		—		—		—		—		(110)		(110)
Net derivative gains (losses)	—		—		—		—		—		—		—		1,349		1,349
Total revenues	36,195		12,462		4,289		3,013		10,095		411		66,465		1,377		67,842
Expenses
Policyholder benefits and claims and policyholder dividends	26,309		5,213		2,406		1,196		6,738		(3)		41,859		692		42,551
Interest credited to policyholder account balances	1,622		1,834		240		109		868		—		4,673		541		5,214
Capitalization of DAC	(453)		(1,652)		(362)		(491)		(39)		(11)		(3,008)		(5)		(3,013)
Amortization of DAC and VOBA	471		1,415		276		454		370		8		2,994		166		3,160
Amortization of negative VOBA	—		(37)		—		(8)		—		—		(45)		—		(45)
Interest expense on debt	7		—		4		1		6		895		913		—		913
Other expenses	4,162		3,481		1,318		1,344		942		625		11,872		263		12,135
Total expenses	32,118		10,254		3,882		2,605		8,885		1,514		59,258		1,657		60,915
Provision for income tax expense (benefit)	853		643		127		81		234		(556)		1,382		127		1,509
Adjusted earnings	$	3,224	$	1,565	$	280	$	327	$	976	$	(547)	5,825
Adjustments to:
Total revenues													1,377
Total expenses													(1,657)
Provision for income tax (expense) benefit													(127)
Net income (loss)													$	5,418			$	5,418

At December 31, 2020	U.S.		Asia (1)		Latin America		EMEA		MetLife Holdings		Corporate & Other		Total
	(In millions)
Total assets	$	291,483	$	173,884	$	75,047	$	28,372	$	184,566	$	41,794	$	795,146
Separate account assets	$	85,316	$	10,825	$	50,073	$	6,083	$	47,673	$	—	$	199,970
Separate account liabilities	$	85,316	$	10,825	$	50,073	$	6,083	$	47,673	$	—	$	199,970

__________________

(1)Total assets includes $146.0 billion of assets from the Company’s Japan operations which represents 18% of total consolidated assets.

Year Ended December 31, 2019	U.S.		Asia		Latin America		EMEA		MetLife Holdings		Corporate & Other		Total		Adjustments		Total Consolidated
	(In millions)
Revenues
Premiums	$	26,801	$	6,632	$	2,723	$	2,177	$	3,748	$	83	$	42,164	$	71	$	42,235
Universal life and investment-type product policy fees	1,078		1,674		1,094		423		1,124		2		5,395		208		5,603
Net investment income	7,021		3,691		1,271		291		5,281		275		17,830		1,038		18,868
Other revenues	887		56		44		54		253		291		1,585		257		1,842
Net investment gains (losses)	—		—		—		—		—		—		—		444		444
Net derivative gains (losses)	—		—		—		—		—		—		—		628		628
Total revenues	35,787		12,053		5,132		2,945		10,406		651		66,974		2,646		69,620
Expenses
Policyholder benefits and claims and policyholder dividends	26,165		5,185		2,623		1,176		6,970		73		42,192		480		42,672
Interest credited to policyholder account balances	1,984		1,710		332		98		905		—		5,029		1,435		6,464
Capitalization of DAC	(484)		(1,913)		(396)		(505)		(28)		(12)		(3,338)		(20)		(3,358)
Amortization of DAC and VOBA	475		1,288		291		428		299		6		2,787		109		2,896
Amortization of negative VOBA	—		(25)		—		(8)		—		—		(33)		—		(33)
Interest expense on debt	10		—		3		—		8		934		955		—		955
Other expenses	4,075		3,818		1,443		1,399		969		1,074		12,778		451		13,229
Total expenses	32,225		10,063		4,296		2,588		9,123		2,075		60,370		2,455		62,825
Provision for income tax expense (benefit)	724		585		227		75		249		(1,201)		659		227		886
Adjusted earnings	$	2,838	$	1,405	$	609	$	282	$	1,034	$	(223)	5,945
Adjustments to:
Total revenues													2,646
Total expenses													(2,455)
Provision for income tax (expense) benefit													(227)
Net income (loss)													$	5,909			$	5,909

At December 31, 2019	U.S.		Asia (1)		Latin America		EMEA		MetLife Holdings		Corporate & Other		Total
	(In millions)
Total assets	$	266,174	$	161,018	$	75,069	$	27,281	$	175,199	$	35,722	$	740,463
Separate account assets	$	75,929	$	9,250	$	52,018	$	5,639	$	45,609	$	—	$	188,445
Separate account liabilities	$	75,929	$	9,250	$	52,018	$	5,639	$	45,609	$	—	$	188,445

__________________

(1)Total assets includes $134.0 billion of assets from the Company’s Japan operations which represents 18% of total consolidated assets.

Year Ended December 31, 2018	U.S.		Asia		Latin America		EMEA		MetLife Holdings		Corporate & Other		Total		Adjustments		Total Consolidated
	(In millions)
Revenues
Premiums	$	28,186	$	6,766	$	2,760	$	2,131	$	3,879	$	118	$	43,840	$	—	$	43,840
Universal life and investment-type product policy fees	1,053		1,630		1,050		431		1,218		—		5,382		120		5,502
Net investment income	6,977		3,317		1,239		293		5,379		178		17,383		(1,217)		16,166
Other revenues	821		51		35		66		250		333		1,556		324		1,880
Net investment gains (losses)	—		—		—		—		—		—		—		(298)		(298)
Net derivative gains (losses)	—		—		—		—		—		—		—		851		851
Total revenues	37,037		11,764		5,084		2,921		10,726		629		68,161		(220)		67,941
Expenses
Policyholder benefits and claims and policyholder dividends	27,765		5,326		2,602		1,127		6,833		80		43,733		174		43,907
Interest credited to policyholder account balances	1,790		1,465		394		100		944		—		4,693		(680)		4,013
Capitalization of DAC	(449)		(1,915)		(377)		(468)		(36)		(8)		(3,253)		(1)		(3,254)
Amortization of DAC and VOBA	477		1,302		209		434		332		6		2,760		215		2,975
Amortization of negative VOBA	—		(39)		(1)		(15)		—		—		(55)		(1)		(56)
Interest expense on debt	12		—		6		—		9		1,032		1,059		63		1,122
Other expenses	3,902		3,840		1,421		1,378		1,081		907		12,529		398		12,927
Total expenses	33,497		9,979		4,254		2,556		9,163		2,017		61,466		168		61,634
Provision for income tax expense (benefit)	736		548		238		88		308		(825)		1,093		86		1,179
Adjusted earnings	$	2,804	$	1,237	$	592	$	277	$	1,255	$	(563)	5,602
Adjustments to:
Total revenues													(220)
Total expenses													(168)
Provision for income tax (expense) benefit													(86)
Net income (loss)													$	5,128			$	5,128

The following table presents total premiums, universal life and investment-type product policy fees and other revenues by major product groups of the Company’s segments, as well as Corporate & Other:

	Years Ended December 31,
	2020		2019		2018
	(In millions)
Life insurance	$	21,256	$	20,759	$	20,550
Accident & health insurance	15,346		15,159		14,489
Annuities	7,916		8,590		10,990
Property and casualty insurance	3,589		3,716		3,651
Other	1,379		1,456		1,542
Total	$	49,486	$	49,680	$	51,222

The following table presents total premiums, universal life and investment-type product policy fees and other revenues associated with the Company’s U.S. and foreign operations:

	Years Ended December 31,
	2020		2019		2018
	(In millions)
U.S.	$	34,717	$	34,433	$	36,078
Foreign:
Japan	6,750		6,608		6,435
Other	8,019		8,639		8,709
Total	$	49,486	$	49,680	$	51,222

Revenues derived from any customer did not exceed 10% of consolidated premiums, universal life and investment-type product policy fees and other revenues for the years ended December 31, 2020 and 2019. Revenues derived from one U.S. segment customer were $6.0 billion for the year ended December 31, 2018, which represented 12% of consolidated premiums, universal life and investment-type product policy fees and other revenues. The revenue was from a single premium received for a pension risk transfer. Revenues derived from any other customer did not exceed 10% of consolidated premiums, universal life and investment-type product policy fees and other revenues for the year ended December 31, 2018.