Accumulated Other Comprehensive Income (Loss)

9 Months Ended

Sep. 30, 2022

Accumulated Other Comprehensive Income (Loss)

Shareholders' equity included the following components of AOCI as of the dates indicated:


	September 30,
	2022		2021
Fixed maturities, net of impairment	$	(3,669)	$	3,521

Derivatives(1)	187		82
DAC/VOBA adjustment on available-for-sale securities(2)	817		(821)		(3)
Premium deficiency reserve adjustment(2)	—		(15)
Other intangibles adjustment on available-for-sale securities(2)	(8)		5

Unrealized capital gains (losses), before tax	(2,673)		2,772
Deferred income tax asset (liability)	684		(459)
Net unrealized capital gains (losses)	(1,989)		2,313
Pension and other postretirement benefits liability, net of tax	3		3
AOCI	$	(1,986)	$	2,316

(1) Gains and losses reported in Accumulated Other Comprehensive Income (AOCI) from hedge transactions that resulted in the acquisition of an identified asset are reclassified into earnings in the same period or periods during which the asset acquired affects earnings. As of September 30, 2022, the portion of the AOCI that is expected to be reclassified into earnings within the next 12 months is $19.

(2) Upon adoption of ASU 2018-12 on January 1, 2023, the DAC/VOBA adjustments on available-for-sale securities, Premium deficiency reserve adjustment and Other intangibles adjustment on available-for-sale securities will be reversed as of the January 1, 2021 transition date and in subsequent periods.

(3) In connection with the closing of the Individual Life Transaction on January 4, 2021, the Company released stranded AOCI and reversed unrealized capital gains (losses) on available-for-sale securities associated with DAC for the disposed entities. In addition, the Company released the unrealized gains for the investments transferred associated with the reinsurance transactions entered into at closing.

Changes in AOCI, including the reclassification adjustments recognized in the Condensed Consolidated Statements of Operations were as follows for the periods indicated:



	Three Months Ended September 30, 2022
	Before-Tax Amount			Income Tax (Benefit)		After-Tax Amount
Available-for-sale securities:
Fixed maturities	$	(1,743)		$	367	$	(1,376)



Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations	(1)			—		(1)
DAC/VOBA	395			(83)		312

Other intangibles	(4)			1		(3)
Change in unrealized gains (losses) on available-for-sale securities	(1,353)			285		(1,068)

Derivatives:
Derivatives	63		(1)	(14)		49
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations	(5)			1		(4)
Change in unrealized gains (losses) on derivatives	58			(13)		45




Change in Accumulated other comprehensive income (loss)	$	(1,295)		$	272	$	(1,023)

(1) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information.



	Nine Months Ended September 30, 2022
	Before-Tax Amount			Income Tax (Benefit)		After-Tax Amount
Available-for-sale securities:
Fixed maturities	$	(6,954)		$	1,461	$	(5,493)



Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations	89			(19)		70
DAC/VOBA	1,585		(1)	(333)		1,252
Premium deficiency reserve adjustment	14			(3)		11
Other intangibles	(13)			3		(10)
Change in unrealized gains (losses) on available-for-sale securities	(5,279)			1,109		(4,170)

Derivatives:
Derivatives	122		(2)	(26)		96
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations	(15)			3		(12)
Change in unrealized gains (losses) on derivatives	107			(23)		84




Change in Accumulated other comprehensive income (loss)	$	(5,172)		$	1,086	$	(4,086)

(1) See the Deferred Policy Acquisition Costs and Value of Business Acquired Note to these Condensed Consolidated Financial Statements for additional information.

(2) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information


	Three Months Ended September 30, 2021
	Before-Tax Amount			Income Tax (Benefit)		After-Tax Amount
Available-for-sale securities:
Fixed maturities	$	(196)		$	41	$	(155)

Other	(2)			—		(2)

Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations	(22)			4		(18)
DAC/VOBA	56			(12)		44

Other intangibles	1			—		1
Change in unrealized gains (losses) on available-for-sale securities	(163)			33		(130)

Derivatives:
Derivatives	23		(1)	(4)		19
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations	(5)			1		(4)
Change in unrealized gains (losses) on derivatives	18			(3)		15




Change in Accumulated other comprehensive income (loss)	$	(145)		$	30	$	(115)

(1) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information .


	Nine Months Ended September 30, 2021
	Before-Tax Amount			Income Tax (Benefit)		After-Tax Amount
Available-for-sale securities:
Fixed maturities	$	(3,295)		$	461	$	(2,834)

Other	(2)			—		(2)

Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations	(1,797)			377		(1,420)
DAC/VOBA	1,250		(1)	(263)		987
Premium deficiency reserve adjustment	445			(93)		352
Other intangibles	420			(88)		332
Change in unrealized gains (losses) on available-for-sale securities	(2,979)			394		(2,585)

Derivatives:
Derivatives	21		(2)	(4)		17
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations	(16)			3		(13)
Change in unrealized gains (losses) on derivatives	5			(1)		4

Pension and other postretirement benefits liability:
Amortization of prior service cost recognized in Operating expenses in the Condensed Consolidated Statements of Operations	(1)			—		(1)
Change in pension and other postretirement benefits liability	(1)			—		(1)
Change in Accumulated other comprehensive income (loss)	$	(2,975)		$	393	$	(2,582)

(1) See the Deferred Policy Acquisition Costs and Value of Business Acquired Note to these Condensed Consolidated Financial Statements for additional information.

(2) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information.