Future Policy Benefits

6 Months Ended

Jun. 30, 2024

Insurance [Abstract]

Liability for Future Policy Benefits and Unpaid Claims Disclosure

4. Future Policy Benefits

The Company establishes liabilities for amounts payable under insurance policies. These liabilities are comprised of traditional and limited-payment contracts and associated deferred profit liability (“DPL”), additional insurance liabilities, participating life and short-duration contracts.

The Company’s FPBs on the interim condensed consolidated balance sheets was as follows at:

	June 30, 2024		December 31, 2023
	(In millions)
Traditional and Limited-Payment Contracts:
RIS - Annuities	$	64,338	$	64,324
Asia:
Whole and term life & endowments	11,260		12,874
Accident & health	9,189		10,712
Latin America - Fixed annuities	9,020		9,637
MetLife Holdings - Long-term care	14,455		15,240
Deferred Profit Liabilities:
RIS - Annuities	3,735		3,697
Asia:
Whole and term life & endowments	690		654
Accident & health	788		830
Latin America - Fixed annuities	522		562
Additional Insurance Liabilities:
Asia:
Variable life	1,074		1,258
Universal and variable universal life	354		424
MetLife Holdings - Universal and variable universal life	2,434		2,362
MetLife Holdings - Participating life	48,911		49,543
Other long-duration (1)	10,544		11,099
Short-duration and other	13,679		13,190
Total	$	190,993	$	196,406

__________________

(1) This balance represents liabilities for various smaller product lines across multiple segments, as well as Corporate & Other.

Rollforwards - Traditional and Limited-Payment Contracts

The following information about the direct and assumed liability for FPBs includes disaggregated rollforwards of expected future net premiums and expected future benefits. The products grouped within these rollforwards were selected based upon common characteristics and valuations using similar inputs, judgments, assumptions and methodologies within a particular segment of the business. The adjusted balance in each disaggregated rollforward reflects the remeasurement (gains) losses. All amounts presented in the rollforwards and accompanying financial information do not include a reduction for amounts ceded to reinsurers, except with respect to ending net liability for FPB balances where applicable.

RIS - Annuities

The RIS segment’s annuity products include pension risk transfers, certain structured settlements and certain institutional income annuities, which are mainly single premium spread-based products. The Company reinsures portions of certain newly issued pension risk transfers on a modified coinsurance basis. Information regarding these products was as follows:

	Six Months Ended June 30,
	2024			2023
	(Dollars in millions)
Present Value of Expected Net Premiums
Balance, beginning of period, at current discount rate at balance sheet date	$	—		$	—
Balance, beginning of period, at original discount rate	$	—		$	—
Effect of actual variances from expected experience (1)	(25)			(29)
Adjusted balance	(25)			(29)
Issuances	4,206			2,558
Net premiums collected	(4,181)			(2,529)
Ending balance at original discount rate	—			—
Balance, end of period, at current discount rate at balance sheet date	$	—		$	—
Present Value of Expected FPBs
Balance, beginning of period, at current discount rate at balance sheet date	$	64,515		$	58,695
Balance, beginning of period, at original discount rate	$	64,737		$	61,426
Effect of actual variances from expected experience (1)	(93)			(167)
Adjusted balance	64,644			61,259
Issuances	4,328			2,561
Interest accrual	1,526			1,411
Benefit payments	(2,976)			(2,726)
Ending balance at original discount rate	67,522			62,505
Effect of changes in discount rate assumptions	(2,847)			(2,020)
Balance, end of period, at current discount rate at balance sheet date	64,675			60,485
Cumulative amount of fair value hedging adjustments	(337)			(204)
Net liability for FPBs	64,338			60,281
Less: Reinsurance recoverables	1,933			—
Net liability for FPBs, net of reinsurance	$	62,405		$	60,281
Undiscounted - Expected future benefit payments	$	123,752		$	115,364
Discounted - Expected future benefit payments (at current discount rate at balance sheet date)	$	64,675		$	60,485
Weighted-average duration of the liability	9 years			9 years
Weighted-average interest accretion (original locked-in) rate	4.7		%	4.7		%
Weighted-average current discount rate at balance sheet date	5.6		%	5.3		%

_________________

(1)    For the six months ended June 30, 2024 and 2023, the net effect of actual variances from expected experience was largely offset by the corresponding impact in DPL associated with the RIS segment’s annuity products of $49 million and $98 million, respectively. Excluding the corresponding impact in DPL, for the six months ended June 30, 2023, the net effect of actual variances from expected experience was primarily driven by favorable mortality and model refinements.

Significant Methodologies and Assumptions

When single premium annuity contracts are issued, the FPB reserve is required to be measured at an upper-medium grade discount rate. Due to differences between the upper-medium grade discount rate and pricing assumptions used to determine the contractual premium, the initial FPB reserve at issue for a particular cohort may be greater than the contractual premium received, and the difference must be recognized as an immediate loss at issue. On these cohorts, future experience that differs from expected experience and changes in cash flow assumptions result in the recognition of remeasurement gains and losses with net remeasurement gains limited to the amount of the original loss at issue, after which any favorable experience is deferred and recorded within the DPL. For the six months ended June 30, 2024, the Company incurred a loss at issue of $126 million. This loss at issue was offset by a deferred gain on ceded reinsurance, which will be amortized over the life of the reinsurance agreement.

Asia

Whole and Term Life & Endowments

The Asia segment’s whole and term life & endowment products in Japan and Korea offer various life insurance coverages to customers. Information regarding these products was as follows:

	Six Months Ended June 30,
		2024			2023
		(Dollars in millions)
Present Value of Expected Net Premiums
Balance, beginning of period, at current discount rate at balance sheet date		$	4,561		$	4,682
Balance, beginning of period, at original discount rate		$	4,793		$	4,943
Effect of actual variances from expected experience		(33)			(26)
Adjusted balance		4,760			4,917
Issuances		269			328
Interest accrual		34			27
Net premiums collected		(304)			(300)
Effect of foreign currency translation		(507)			(384)
Ending balance at original discount rate		4,252			4,588
Effect of changes in discount rate assumptions		(277)			(196)
Effect of foreign currency translation on the effect of changes in discount rate assumptions		30			15
Balance, end of period, at current discount rate at balance sheet date		$	4,005		$	4,407
Present Value of Expected FPBs
Balance, beginning of period, at current discount rate at balance sheet date		$	17,435		$	17,463
Balance, beginning of period, at original discount rate		$	17,198		$	18,209
Effect of actual variances from expected experience		(33)			1
Adjusted balance		17,165			18,210
Issuances		269			328
Interest accrual		183			185
Benefit payments		(484)			(624)
Effect of foreign currency translation		(1,813)			(1,360)
Ending balance at original discount rate		15,320			16,739
Effect of changes in discount rate assumptions		(131)			154
Effect of foreign currency translation on the effect of changes in discount rate assumptions		76			11
Balance, end of period, at current discount rate at balance sheet date		15,265			16,904
Cumulative impact of flooring the future policyholder benefits reserve		—			2
Net liability for FPBs		11,260			12,499
Less: Amount due to reinsurer		(1)			(2)
Net liability for FPBs, net of reinsurance		$	11,261		$	12,501
Undiscounted:
Expected future gross premiums		$	8,363		$	8,786
Expected future benefit payments		$	25,574		$	26,771
Discounted (at current discount rate at balance sheet date):
Expected future gross premiums		$	7,140		$	7,691
Expected future benefit payments		$	15,265		$	16,904
Weighted-average duration of the liability		17 years			17 years
Weighted -average interest accretion (original locked-in) rate		2.6		%	2.5		%
Weighted-average current discount rate at balance sheet date		2.8		%	2.5		%

Accident & Health

The Asia segment’s accident & health products in Japan and Korea offer various hospitalization, cancer, critical illness, disability, income protection and personal accident coverage. Information regarding these products was as follows:

	Six Months Ended June 30,
	2024			2023
	(Dollars in millions)
Present Value of Expected Net Premiums
Balance, beginning of period, at current discount rate at balance sheet date	$	19,835		$	21,181
Balance, beginning of period, at original discount rate	$	21,232		$	22,594
Effect of actual variances from expected experience (1)	292			(33)
Adjusted balance	21,524			22,561
Issuances	551			536
Interest accrual	110			120
Net premiums collected	(928)			(1,055)
Effect of foreign currency translation	(2,496)			(1,849)
Ending balance at original discount rate	18,761			20,313
Effect of changes in discount rate assumptions	(1,720)			(1,006)
Effect of foreign currency translation on the effect of changes in discount rate assumptions	187			83
Balance, end of period, at current discount rate at balance sheet date	$	17,228		$	19,390
Present Value of Expected FPBs
Balance, beginning of period, at current discount rate at balance sheet date	$	30,480		$	30,879
Balance, beginning of period, at original discount rate	$	36,010		$	37,189
Effect of actual variances from expected experience (1)	331			(53)
Adjusted balance	36,341			37,136
Issuances	551			536
Interest accrual	232			246
Benefit payments	(614)			(653)
Effect of foreign currency translation	(4,161)			(3,017)
Ending balance at original discount rate	32,349			34,248
Effect of changes in discount rate assumptions	(6,761)			(4,664)
Effect of foreign currency translation on the effect of changes in discount rate assumptions	750			385
Balance, end of period, at current discount rate at balance sheet date	26,338			29,969
Cumulative impact of flooring the future policyholder benefits reserve	79			83
Net liability for FPBs	9,189			10,662
Less: Reinsurance recoverables	143			149
Net liability for FPBs, net of reinsurance	$	9,046		$	10,513
Undiscounted:
Expected future gross premiums	$	36,531		$	39,362
Expected future benefit payments	$	42,531		$	44,435
Discounted (at current discount rate at balance sheet date):
Expected future gross premiums	$	29,420		$	33,399
Expected future benefit payments	$	26,338		$	29,969
Weighted-average duration of the liability	23 years			26 years
Weighted-average interest accretion (original locked-in) rate	1.7		%	1.8		%
Weighted-average current discount rate at balance sheet date	2.8		%	2.3		%

_________________

(1)    For the six months ended June 30, 2024, the net effect of actual variances from expected experience was partially offset by the corresponding impact in DPL associated with the Asia segment’s accident and health products of ($6) million.

Latin America - Fixed Annuities

The Latin America segment’s fixed annuity products in Chile and Mexico offer fixed income annuities that provide for asset distribution needs. Information regarding these products was as follows:

	Six Months Ended June 30,
	2024			2023
	(Dollars in millions)
Present Value of Expected Net Premiums
Balance, beginning of period, at current discount rate at balance sheet date	$	—		$	—
Balance, at beginning of period, at original discount rate	$	—		$	—
Effect of actual variances from expected experience (1)	—			—
Adjusted balance	—			—
Issuances	494			525
Interest accrual	5			5
Net premiums collected	(499)			(530)
Ending balance at original discount rate	—			—
Balance, end of period, at current discount rate at balance sheet date	$	—		$	—
Present Value of Expected FPBs
Balance, beginning of period, at current discount rate at balance sheet date	$	9,637		$	9,265
Balance, beginning of period, at original discount rate	$	9,249		$	8,240
Effect of actual variances from expected experience (1)	(9)			(9)
Adjusted balance	9,240			8,231
Issuances	509			577
Interest accrual	167			173
Benefit payments	(339)			(336)
Inflation adjustment	184			243
Effect of foreign currency translation	(691)			538
Ending balance at original discount rate	9,070			9,426
Effect of changes in discount rate assumptions	(28)			706
Effect of foreign currency translation on the effect of changes in discount rate assumptions	(22)			60
Balance, end of period, at current discount rate at balance sheet date	9,020			10,192
Net liability for FPBs	$	9,020		$	10,192
Undiscounted - Expected future benefit payments	$	13,648		$	14,343
Discounted - Expected future benefit payments (at current discount rate at balance sheet date)	$	9,020		$	10,192
Weighted-average duration of the liability	10 years			11 years
Weighted-average interest accretion (original locked-in) rate	3.6		%	3.9		%
Weighted-average current discount rate at balance sheet date	3.7		%	2.9		%

__________________

(1)    For the six months ended June 30, 2024, the net effect of actual variances from expected experience was not offset by the corresponding impact in DPL associated with the Latin America segment’s fixed annuity products primarily due to the variance related to cohorts with no DPL. For the six months ended June 30, 2023, the net effect of actual variances from expected experience was partially offset by the corresponding impact in DPL associated with the Latin America segment’s fixed annuity products of $3 million.

MetLife Holdings - Long-term Care

The MetLife Holdings segment’s long-term care products offer protection against potentially high costs of long-term health care services. Information regarding these products was as follows:

	Six Months Ended June 30,
	2024			2023
	(Dollars in millions)
Present Value of Expected Net Premiums
Balance, beginning of period, at current discount rate at balance sheet date	$	5,687		$	5,775
Balance, beginning of period, at original discount rate	$	5,566		$	5,807
Effect of actual variances from expected experience	13			83
Adjusted balance	5,579			5,890
Interest accrual	141			149
Net premiums collected	(286)			(293)
Ending balance at original discount rate	5,434			5,746
Effect of changes in discount rate assumptions	(80)			3
Balance, end of period, at current discount rate at balance sheet date	$	5,354		$	5,749
Present Value of Expected FPBs
Balance, beginning of period, at current discount rate at balance sheet date	$	20,927		$	19,619
Balance, beginning of period, at original discount rate	$	20,494		$	20,165
Effect of actual variances from expected experience	31			99
Adjusted balance	20,525			20,264
Interest accrual	540			534
Benefit payments	(421)			(382)
Ending balance at original discount rate	20,644			20,416
Effect of changes in discount rate assumptions	(835)			(169)
Balance, end of period, at current discount rate at balance sheet date	19,809			20,247
Net liability for FPBs	$	14,455		$	14,498
Undiscounted:
Expected future gross premiums	$	10,280		$	10,893
Expected future benefit payments	$	44,653		$	45,653
Discounted (at current discount rate at balance sheet date):
Expected future gross premiums	$	6,715		$	7,089
Expected future benefit payments	$	19,809		$	20,247
Weighted-average duration of the liability	14 years			15 years
Weighted-average interest accretion (original locked-in) rate	5.4		%	5.4		%
Weighted-average current discount rate at balance sheet date	5.8		%	5.5		%

Rollforwards - Additional Insurance Liabilities

The Company establishes additional insurance liabilities for annuitization, death or other insurance benefits for variable life, universal life, and variable universal life contract features where the Company guarantees to the contractholder either a secondary guarantee or a guaranteed paid-up benefit. The policy can remain in force, even if the base policy account value is zero, as long as contractual secondary guarantee requirements have been met.

The following information about the direct liability for additional insurance liabilities includes disaggregated rollforwards. The products grouped within these rollforwards were selected based upon common characteristics and valuations using similar inputs, judgments, assumptions and methodologies within a particular segment of the business. The adjusted balance in each disaggregated rollforward reflects the remeasurement (gains) losses. All amounts presented in these rollforwards and accompanying financial information do not include a reduction for amounts ceded to reinsurers.

Asia

The Asia segment’s variable life, universal life, and variable universal life products in Japan offer a contract feature where the Company guarantees to the contractholder a secondary guarantee. Information regarding these additional insurance liabilities was as follows:

	Six Months Ended June 30,
	2024			2023			2024			2023
	Variable Life						Universal and Variable Universal Life
	(Dollars in millions)
Balance, beginning of period	$	1,258		$	1,381		$	424		$	455
Less: Accumulated other comprehensive income (loss) (“AOCI”) adjustment	—			—			(14)			(33)
Balance, beginning of period, before AOCI adjustment	1,258			1,381			438			488
Effect of actual variances from expected experience	(14)			(8)			(32)			(22)
Adjusted balance	1,244			1,373			406			466
Assessments accrual	(2)			(2)			—			—
Interest accrual	9			10			3			3
Excess benefits paid	(23)			(19)			—			—
Effect of foreign currency translation and other, net	(154)			(119)			(53)			(41)
Balance, end of period, before AOCI adjustment	1,074			1,243			356			428
Add: AOCI adjustment	—			—			(2)			(18)
Balance, end of period	$	1,074		$	1,243		$	354		$	410
Weighted-average duration of the liability	16 years			17 years			43 years			43 years
Weighted-average interest accretion rate	1.5		%	1.5		%	1.5		%	1.5		%

MetLife Holdings

The MetLife Holdings segment’s universal life and variable universal life products offer a contract feature where the Company guarantees to the contractholder a secondary guarantee or a guaranteed paid-up benefit. Information regarding these additional insurance liabilities was as follows:

	Six Months Ended June 30,
	2024			2023
	Universal and Variable Universal Life
	(Dollars in millions)
Balance, beginning of period	$	2,362		$	2,156
Less: AOCI adjustment	(14)			(63)
Balance, beginning of period, before AOCI adjustment	2,376			2,219
Effect of actual variances from expected experience	28			(6)
Adjusted balance	2,404			2,213
Assessments accrual	51			55
Interest accrual	65			61
Excess benefits paid	(70)			(63)
Balance, end of period, before AOCI adjustment	2,450			2,266
Add: AOCI adjustment	(16)			2
Balance, end of period	2,434			2,268
Less: Reinsurance recoverables	2,117			744
Balance, end of period, net of reinsurance	$	317		$	1,524
Weighted-average duration of the liability	15 years			16 years
Weighted-average interest accretion rate	5.5		%	5.6		%

The Company’s gross premiums or assessments and interest expense recognized in the interim condensed consolidated statements of operations and comprehensive income (loss) for long-duration contracts, excluding MetLife Holdings’ participating life contracts, were as follows:

		Six Months Ended June 30,
		2024				2023
		Gross Premiums or Assessments (1)		Interest Expense (2)		Gross Premiums or Assessments (1)		Interest Expense (2)
	(In millions)
Traditional and Limited-Payment Contracts:
RIS - Annuities		$	4,246	$	1,526	$	2,592	$	1,411
Asia:
Whole and term life & endowments		564		149		555		158
Accident & health		1,551		122		1,762		126
Latin America - Fixed annuities		499		162		529		168
MetLife Holdings - Long-term care		362		399		366		385
Deferred Profit Liabilities:
RIS - Annuities		N/A		88		N/A		81
Asia:
Whole and term life & endowments		N/A		17		N/A		14
Accident & health		N/A		9		N/A		9
Latin America - Fixed annuities		N/A		10		N/A		11
Additional Insurance Liabilities:
Asia:
Variable life		55		9		11		10
Universal and variable universal life		(33)		3		(14)		3
MetLife Holdings - Universal and variable universal life		334		65		380		61
Other long-duration		2,132		239		2,015		227
Total		$	9,710	$	2,798	$	8,196	$	2,664

__________________

(1)Gross premiums are related to traditional and limited-payment contracts and are included in premiums. Assessments are related to additional insurance liabilities and are included in universal life and investment-type product policy fees and net investment income.

(2)Interest expense is included in policyholder benefits and claims.

Liabilities for Unpaid Claims and Claim Expenses

Rollforward of Claims and Claim Adjustment Expenses

Information regarding the liabilities for unpaid claims and claim adjustment expenses was as follows:

	Six Months Ended June 30,
	2024		2023
	(In millions)
Balance, beginning of period	$	16,468	$	16,098
Less: Reinsurance recoverables	2,592		2,452
Net balance, beginning of period	13,876		13,646
Incurred related to:
Current period	13,420		13,580
Prior periods (1)	99		306
Total incurred	13,519		13,886
Paid related to:
Current period	(8,723)		(8,546)
Prior periods	(4,921)		(4,959)
Total paid	(13,644)		(13,505)
Net balance, end of period	13,751		14,027
Add: Reinsurance recoverables	2,762		2,590
Balance, end of period (included in FPBs and other policy-related balances)	$	16,513	$	16,617

__________________

(1)For the six months ended June 30, 2024 and 2023, incurred claims and claim adjustment expenses associated with prior periods increased due to events incurred in prior periods but reported in the respective current period.