Intangibles

1 Months Ended

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

A summary of the changes in the carrying amounts of the Company's VOBA, DAC and DSI intangible assets are as follows (in millions):


	VOBA		DAC		DSI		Total
Balance at Balance at December 31, 2019	$	—	$	—	$	—	$	—
F&G acquisition	1,890		—		—		1,890
Deferrals	—		28		6		34
Amortization	(3)		—		—		(3)
Interest	3		—		—		3
Unlocking	—		—		—		—
Adjustment for net unrealized investment (gains) losses	(101)		(8)		(2)		(111)
Balance at June 30, 2020	$	1,789	$	20	$	4	$	1,813

Amortization of VOBA, DAC, and DSI is based on the current and future expected gross margins or profits recognized, including investment gains and losses. The interest accrual rate utilized to calculate the accretion of interest on VOBA ranged from 0% to 4.66%. The adjustment for unrealized net investment losses (gains) represents the amount of VOBA, DAC, and DSI that would have been amortized if such unrealized gains and losses had been recognized. This is referred to as the “shadow adjustments” as the additional amortization is reflected in AOCI rather than the unaudited Condensed Consolidated Statements of Operations. As of June 30, 2020, the VOBA balances included cumulative adjustments for net unrealized investment gains of $101 million, the DAC balances included cumulative adjustments for net unrealized investment gains of $8 million, and the DSI balance included net unrealized investment gains of $2 million.

For the inforce liabilities as of June 30, 2020, the estimated amortization expense for VOBA in future fiscal periods is as follows (in millions):


	Estimated Amortization Expense
Fiscal Year
2020	$	95
2021	191
2022	230
2023	212
2024	194
Thereafter	968

The Company had an unearned revenue liability balance of $0 as of June 30, 2020, including deferrals of $(4) million, amortization of $0, interest of $0, unlocking of $0 and adjustment for net unrealized investment gains (losses) of $4 million.

Definite and Indefinite Lived Other Intangible Assets

Other intangible assets as of June 30, 2020 consist of the following (in millions):


	Cost		Accumulated amortization		Net carrying amount		Weighted average useful life (years)
Customer relationships and contracts	$	774	$	(576)	$	198	10
Computer software	384		(237)		147		2 to 10
Value of Distribution Asset (VODA)	185		(1)		184		15
Definite lived trademarks, tradenames, and other	73		(20)		53		10
Indefinite lived tradenames and other	40		N/A		40		Indefinite



Total					$	622

Other intangible assets as of June 30, 2020 consist of the following (in millions):


	Cost		Accumulated amortization		Net carrying amount		Weighted average useful life (years)
Customer relationships and contracts	$	774	$	(576)	$	198	10
Computer software	384		(237)		147		2 to 10
Value of Distribution Asset (VODA)	185		(1)		184		15
Definite lived trademarks, tradenames, and other	73		(20)		53		10
Indefinite lived tradenames and other	40		N/A		40		Indefinite



Total					$	622