One American Row, Hartford, Connecticut 06115
(Address of Depositor’s Principal Executive Offices) (Zip Code)

The Corporation Trust Company (CT Corp)
1209 N Orange Street
Wilmington, Delaware 19801
(Name and Address of Agent for Service)

Approximate Date of Proposed Public Offering: As soon as practicable after the effective date of this Registration Statement.

Title of Securities Being Registered: Units of interest in First Investors Life Variable Annuity Fund A supporting individual flexible premium deferred variable annuity contracts.

Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until Registrant shall file a further amendment which specifically states that this Registration Statement shall become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

Explanatory Note: Units of interest supporting the individual flexible premium deferred variable annuity contracts issued through the Registrant were previously registered on Form N-4 (File Nos. 002-66295; 811-02982). Upon effectiveness of the merger of Foresters Life Insurance and Annuity Company (formerly First Investors Life Insurance Company) with and into Nassau Life Insurance Company (“NNY”), NNY became the obligor of the contracts and the depositor of Registrant, necessitating the filing of a new Registration Statement under the Securities Act of 1933 and an amendment to the Registration Statement under the Investment Company Act of 1940.

Individual Variable Annuity Contract
Issued By
Nassau Life Insurance Company
Through
First Investors Life Variable Annuity Fund A

Administrative Office
Address: Raritan Plaza 1, P.O. Box 7836, Edison, New Jersey 08818-7836
Phone Number: 1-800-832-7783 (9:00 A.M. and 5:00 P.M., Eastern Time)
Website: www.NSRE.com

This supplement updates certain information contained in the prospectus, dated April 23, 2002, for the Individual Variable Annuity Contract (the “Contract”). Please read this supplement carefully and retain it for future reference. Capitalized terms not otherwise defined in this supplement have the meanings given to them in the prospectus.

Nassau Life Insurance Company (“NNY”) is supplementing the prospectus for the Contract to provide information about the acquisition of the issuer of the Contracts, Foresters Life Insurance and Annuity Company (“FLIAC”), by NNY and the subsequent merger (the “Merger”) of FLIAC with and into NNY.

NNY entered into an agreement with FLIAC whereby NNY would purchase FLIAC. The acquisition of FLIAC by NNY was completed on July 1, 2020. Following the acquisition, on July 8, 2020, FLIAC merged with and into NNY, with NNY as the surviving company. Upon completion of the Merger, FLIAC’s corporate existence ceased by operation of law. As the surviving company, NNY assumed all the rights, duties and obligations of FLIAC, including those related to the First Investors Life Variable Annuity Fund A (the “Separate Account” or “Separate Account A”). The Separate Account became a separate account of NNY. NNY assumed legal ownership of the assets of the Separate Account and responsibility for the liabilities and obligations of all outstanding Contracts.

The Merger did not affect the terms of, or the rights and obligations under, the Contracts other than to change the insurance company that provides Contract benefits from FLIAC to NNY. The Contracts continue to be funded by the Separate Account. Contract values did not change as a result of the Merger. No additional charges were imposed and no deductions were made as a result of the Merger. The Merger did not have any tax consequences for Contractowners.

Following the acquisition of FLIAC by NNY, an NNY affiliate, 1851 Securities, Inc., became the principal underwriter for the Contracts.

The Contract is no longer available for new sales, but owners of outstanding Contracts may continue to make additional Purchase Payments.

The information below describes changes to the prospectus as a result of the Merger and otherwise updates information in the prospectus.

The next table shows the operating expenses charged by the Delaware VIP^®Fund for Income Series that you will pay periodically during the time that you own the Contract. More detail concerning the Fund’s fees and expenses is contained in the prospectus for the Fund.

This Example is intended to help you compare the cost of investing in the Contract with the cost of investing in other variable annuity contracts. These costs include Contractowner transaction expenses, the annual administrative charge, Separate Account annual expenses and the Fund operating expenses.

The Example assumes that you invest $10,000 in the Contract for the time periods indicated. The Example also assumes that your investment has a 5% return each year and assumes the total annual Fund operating expenses (before waivers and expense reimbursements) of the Fund. The Example does not reflect the deduction of the annual administrative charge because the assumed Accumulated Value is greater than $1,499 during all periods. Although your actual costs may be higher or lower, based on these assumptions, your costs would be as follows.

If you surrender or do not surrender the Contract, or if you annuitize the Contract, at the end of the applicable time period:

This table shows Accumulation Unit Values and the number of Accumulation Units outstanding for Separate Account A for the last ten fiscal years. You should read the information in the following table in conjunction with the Separate Account’s financial statements contained in the Statement of Additional Information. See “FINANCIAL STATEMENTS” below for instructions on how to obtain the Statement of Additional Information free of charge.

NNY, with its home office at One American Row, Hartford, Connecticut 06115, is a stock life insurance company organized under the laws of the State of New York. NNY is authorized to conduct life and annuity business in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands. The statutory home office of NNY is located at 15 Tech Valley Drive, East Greenbush, New York 12061.

NNY is part of Nassau Financial Group L.P. (the “Nassau Group”). NNY has been operating as an insurance company since 1851. It was acquired by the Nassau Group in 2016. Other affiliates of NNY include 1851 Securities, Inc. (or hereafter “1851”), which is the distributor for the Contracts, and the Nassau Companies of New York, which will provide administrative services for the Contracts.

For information or service concerning a Contract, you may contact us in writing at our Administrative Office located at Raritan Plaza 1, P.O. Box 7836, Edison, New Jersey 08818-7836. You may also call us at 1-800-832-7783 between the hours of 9:00 A.M. and 5:00 P.M., Eastern Time, or fax us at 732-855-5935. You may also contact us through our website at www.NSRE.com.

You should send any Purchase Payments, notices, elections or requests (including requests for the Fund’s prospectus), as well as any other documentation that we require for any purpose in connection with your Contract, to our Administrative Office. No payment, notice, election, request or documentation will be treated as having been “received” by us until we have actually received it, as well as any related forms and items that we require, all in complete and Good Order (i.e., in form and substance acceptable to us) at our Administrative Office. To meet our requirements for processing transactions, we may require that you use our forms. We will notify you and provide you with an address if we designate another office for receipt of information, payments and documents.

Separate Account A was established on September 11, 1979 under New York Insurance Law. Separate Account A is a unit investment trust registered with the Securities and Exchange Commission (“SEC”) under the Investment Company Act of 1940 (the “1940 Act”).

We segregate the assets of Separate Account A from our other assets in our General Account. These assets fall into two categories: (1) assets equal to our reserves and other liabilities under the Contract and (2) additional assets derived from expenses that we charge to Separate Account A. The assets equal to our reserves and liabilities support the Contract. We cannot use these assets to satisfy any of our other obligations. The assets we derive from Contract charges do not support the Contract, and we can transfer these assets in cash to our General Account. Before making a transfer, we will consider any possible adverse impact that the transfer may have on Separate Account A. We credit to, or charge against, Separate Account A realized and unrealized income, gains and losses without regard to our other income, gains and losses. The obligations under the Contract are our obligations.

Separate Account A invests its assets in shares of the Fund at net asset value. We own the shares of the Fund held in Separate Account A, not you. The value of your investment in Separate Account A is determined based on the net asset value of the Fund’s shares and the number of Fund shares held in Separate Account A, the number of Accumulation Units outstanding and attributable to your Contract, and any applicable deductions for charges and expenses under the Contract that reduce the Accumulation Unit value. Separate Account A reinvests any distribution received from the Fund in additional shares of the Fund at net asset value. Separate Account A may make deductions for charges and expenses under the Contract by redeeming the number of equivalent Fund shares at net asset value.

Separate Account A previously invested in shares of the First Investors Life Series Fund for Income (formerly named the First Investors Special Bond Fund, Inc.), a fund of the First Investors Life Series Funds, until October 4, 2019. On that date, the First Investors Life Series Fund for Income was reorganized into a substantially similar series of the Delaware VIP^®Trust called the Delaware VIP^®Fund for Income Series. As a result, shares of the First Investors Life Series Fund for Income held in the Separate Account on October 4, 2019 became shares of the Delaware VIP^®Fund for Income Series, and the Separate Account has invested in shares of the Delaware VIP^®Fund for Income Series since that time.

The Delaware VIP^®Fund for Income Series is a series of the Delaware VIP^®Trust, an open-end management investment company registered with the SEC under the 1940 Act. The Fund’s investment manager is Delaware Management Company. The Fund’s sub-advisers are Macquarie Investment Management Austria Kapitalanlage AG, Macquarie Investment Management Europe Limited and Macquarie Investment Management Global Limited. The Fund’s investment objective is high current income. There is no guarantee that Fund will achieve its stated objective.

The Fund currently offers its shares only through variable insurance products issued by NNY or by other insurance companies. The Fund reserves the right to offer its shares to other separate accounts or directly to NNY. Although the Fund may have a similar name, the same portfolio managers or a similar investment objective as other publicly available mutual funds, the Fund is separate and distinct from such other mutual funds. The Fund will have different portfolio holdings and fees, so its performance will vary from such other mutual funds.

The investment objective, principal investment strategies, principal risks and management of the Fund are further described in the Fund prospectus. You should read the prospectus carefully. You may obtain another copy of the Fund’s prospectus by writing to us at our Administrative Office, located at Raritan Plaza 1, P.O. Box 7836, Edison, New Jersey 08818-7836, calling us at 1-800-832-7783 between the hours of 9:00 A.M. to 5:00 P.M., Eastern Time or faxing us at 732-510-4209. You also can obtain a copy of the Fund’s prospectus at www.delawarefunds.com/dcio/literature.

The assets of our General Account support our insurance obligations and are subject to general liabilities from our business operations and to claims by our general creditors. Amounts paid by us under your Contract that are not paid from the Separate Account (such as annuity payments) are paid from our General Account. Any such payments are subject to our financial strength and claims-paying ability.

How to Obtain More Information. We encourage Contractowners to read and understand our financial statements. Our audited financial statements, as well as the audited financial statements of the Separate Account, are located in the Statement of Additional Information. See “FINANCIAL STATEMENTS” below for instructions on how to obtain the Statement of Additional Information free of charge.

There are deductions from and expenses paid out of the assets of the Fund that are described in the prospectus for the Fund.

This section provides a general summary of the federal tax law as it pertains to the Contract. We believe that the Contract will qualify as a tax-deferred annuity contract for federal income tax purposes and the following summary assumes so. We do not discuss state or local taxes herein, except as noted. The law described herein could change, possibly retroactively. We have the right to modify the Contract in response to changes in the law that affect the favorable tax treatment for annuity owners. We do not offer this summary as tax advice, for which you should consult a qualified tax adviser.

Taxation of a Contract will depend, in part, on whether the Contract is purchased as part of a qualified retirement plan, a traditional IRA or a Roth IRA.

The following discussion does not apply to a Contract that has been purchased as part of a qualified retirement plan or IRA (a “qualified Contract”). If a qualified Contract is purchased, the tax treatment of Purchase Payments, annuity payments, surrenders and death benefits with respect to a qualified Contract will be governed by the tax law applicable to qualified retirement plans and IRAs. However, generally, deductible or “before-tax” Purchase Payments for qualified Contracts will be taxed when distributed from the Contract; the Contract is not forfeitable; and Contract ownership may not be transferred.

Purchase Payments for a Contract purchased outside of a qualified retirement plan or IRA (a “non-qualified” contract) are on an “after-tax” basis, so you only pay federal income tax on your net earnings and net realized gains under the Contract. Generally, these earnings and gains are taxed when you receive distributions thereof under the Contract. The IRS has not reviewed the Contracts for qualification as an appropriate investment for a qualified plan or IRA.

When a non-natural person owns a non-qualified Contract, the Contract generally will not be treated as an annuity for federal tax purposes and thus will not enjoy the benefit of tax deferral. However, a Contract owned by a non-natural person as agent for an individual will be treated as an annuity for those purposes.

This summary assumes that the Contractowner is a natural person who is a U.S. citizen or U.S. resident. The federal tax law applicable to corporate taxpayers, non-U.S. citizens, and non-U.S. residents may be different.

Your Purchase Payments are not deductible from your gross income for federal income tax purposes.

Generally, you pay no federal income tax on increases in your Contract’s Accumulated Value until there is a distribution from a Contract. A distribution occurs when there is a partial or full surrender or annuity payments begin.

Once annuity payments begin, you generally will be taxed for federal income tax purposes only on the net investment income and investment gains you have earned (as ordinary income) and not on the amount of your Purchase Payments. As a result, a portion of each payment is taxable as ordinary income. The remaining portion is a nontaxable recovery of your investment in the Contract. Generally, your investment in the Contract equals the Purchase Payments you made, less any amounts you previously surrendered that were not taxable.

For fixed annuity payments, the tax-free portion of each payment is determined by:

For variable annuity payments, the tax-free portion of each payment is (a) your investment in the Contract divided by (b) the number of expected payments.

The remaining portion of each payment, and all of the payments you receive after you recover your investment in the Contract, are fully taxable. If payments under a life annuity stop because the Annuitant dies, there is a federal income tax deduction for any unrecovered investment in the Contract.

Before annuity payments begin, surrenders are taxed for federal income tax purposes as follows:

If you receive systematic payments that you intend to qualify for the substantially equal periodic payment exception, changes to your systematic payments before you reach age 59½ or within five years (whichever is later) after beginning your systematic payments will result in the retroactive imposition of the 10% federal tax penalty with interest. Other exceptions may apply under certain circumstances. Special rules may also apply to the exceptions noted above.

If the Contract was purchased as an investment for profit, subject to certain rules, you may deduct any loss upon surrender of the Contract as an ordinary loss.

For purposes of surrenders, the Internal Revenue Code treats all non-qualified deferred Contracts that we issue to you in the same calendar year as a single Contract.

Unlike the death benefit on a life insurance policy, the death benefit paid on an annuity contract does not pass to the beneficiary free of federal income tax. Generally, a death benefit is included in the income of the recipient as follows:

The death benefit paid to a Beneficiary on a Contract is ordinary income to the Beneficiary to the extent it exceeds the Contractowner’s investment in the Contract. The Beneficiary must pay federal income tax on this amount at the Beneficiary’s tax rate. Moreover, the death benefit may also be included in the Contractowner’s federal gross estate unless the Beneficiary is the spouse. If the Beneficiary is not the spouse, the Beneficiary may be eligible for a special federal income tax deduction for a portion of the federal estate tax attributable to the death benefit.

Transferring or assigning ownership of the Contract, designating an annuitant other than the owner, selecting or changing Annuity Commencement Dates or exchanging a Contract (unless the exchange qualifies as a tax-free exchange under Section 1035 of the Internal Revenue Code) may result in certain tax consequences, such as liability for federal income and gift taxes, not explained in this prospectus.

The Internal Revenue Code generally requires us to withhold income tax from any Contract distribution, including a partial or total surrender or an annuity payment. The amount of withholding depends, in part, on whether the payment is "periodic" or "non-periodic." For periodic payments (e.g., annuity payments), upon request we withhold from the taxable portion of each payment based on a payroll withholding schedule that assumes a married recipient claiming three withholding exemptions. If you want us to withhold on a different basis, you must file an appropriate withholding certificate with us. For non-periodic payments (e.g., distributions such as partial surrenders), we generally withhold 10% of the taxable portion of each payment.

You may elect not to have the withholding rules apply. For periodic payments, your election is effective for the calendar year for which you file it with us, and for each subsequent year until you amend or modify it. For non-periodic payments, an election is effective when you file it with us, but only for the payment to which it is applicable. We have to notify your recipients of your right to elect not to have taxes withheld.

The Internal Revenue Code generally requires us to report all payments to the Internal Revenue Service.

While we are not discussing the federal estate tax implications of the Contract, owners of variable annuity contracts should keep in mind that the value of an annuity contract owned by a decedent and payable to a beneficiary who survives the decedent is included in the decedent’s gross estate. Depending on the terms of the annuity contract, the value of the annuity included in the gross estate may be the value of the lump sum payment payable to the designated beneficiary or the actuarial value of the payments to be received by the beneficiary. Consult an estate planning adviser for more information.

Under certain circumstances, the Internal Revenue Code may impose a generation-skipping (“GST”) tax when all or part of an annuity contract is transferred to, or a death benefit is paid to, an individual two or more generations younger than the owner. Regulations issued under the Internal Revue Code may require us to deduct the tax from your Contract, or from any applicable payment, and pay it directly to the Internal Revenue Service.

The federal estate tax, gift tax, and GST tax exemptions and maximum rates may be adjusted each year. The potential application of these taxes underscores the importance of seeking guidance from a qualified adviser to help ensure that your estate plan adequately addresses your needs and those of your beneficiaries under all possible scenarios.

Distributions from non-qualified annuity contracts will be considered “investment income” for purposes of the newly enacted Medicare tax on investment income. Thus, in certain circumstances, a 3.8% tax may be applied to some or all of the taxable portion of distributions (e.g. earnings) to individuals whose income exceeds certain threshold amounts. Please consult a tax adviser for more information.

All Contract provisions relating to spousal continuation are available only to a person who meets the definition of “spouse” under federal law. The U.S. Supreme Court has held that same-sex marriages must be permitted under state law and that marriages recognized under state law will be recognized for federal

law purposes. Domestic partnerships and civil unions that are not recognized as legal marriages under state law, however, will not be treated as marriages under federal law. Consult a tax adviser for more information on this subject.

We may benefit from any foreign tax credits attributable to taxes paid by the Fund to foreign jurisdictions to the extent permitted under federal tax law.

We are taxed as a “life insurance company” under the Internal Revenue Code. We do not expect to incur any federal income tax as a result of the net earnings or realized net capital gains attributable to the Separate Account. Based upon this expectation, no charge is currently assessed against the Separate Account for such tax. If we incur such tax in the future, we may assess a charge for such tax against the Separate Account. We may incur state and local income taxes (in addition to premium taxes) attributable to the Separate Account in several states. At present, these taxes are not significant and we currently do not impose any charge for such taxes against the Separate Account. We may, however, assess the Separate Account for such taxes in the future. If any charges for federal, state or local taxes are assessed against the Separate Account in the future, they could reduce the net investment performances of the Separate Account.

In order for the Contract to be treated as an annuity contract for federal income tax purposes, the Separate Account must be “adequately diversified” in accordance with the Internal Revenue Code and Treasury Department regulations. The investment adviser of the Fund monitors the Fund’s investment portfolio to ensure that the diversification requirements are met, because, for purposes thereof, the Fund’s assets are treated as if they are owned by the Separate Account. If the Separate Account failed to satisfy these requirements, you would be currently taxed on the net earnings and net realized gains of the Separate Account unless your Contract was held in a qualified plan or an IRA. The tax would apply from the first quarter of the failure, until we corrected the failure in conformity with a Treasury Department procedure. This is a risk that is common to all variable annuity contracts.

The Fund under the Contract sells its shares not only to the Separate Account but also to other separate accounts that fund variable life insurance policies and variable annuity contracts. We do not anticipate any disadvantage resulting from this arrangement. However, it is possible that a material conflict of interest could arise between the interests of policyowners and contractowners that invest in the same Fund. If such a conflict were to arise, we would take whatever steps were necessary to protect the interests of policyowners and contractowners, including potentially substituting a different fund for the Fund. It is also possible that the failure of one separate account to comply with the federal tax law requirements could cause all of the separate accounts to lose their tax-deferred status. This is a risk that is common to many variable life insurance policies and variable annuities.

Under certain circumstances, a Contractowner’s control of the investments of the Separate Account could cause the Contractowner, rather than us, to be treated as the owner of the assets in the Separate Account for federal tax purposes, which would result in the current taxation of the net income and net realized gains on those assets to the Contractowner. Based upon existing IRS guidance, we do not believe that the ownership rights of a Contractowner under the Contract would result in a Contractowner being treated as the owner of the assets of the Contract. However, we do not know whether additional guidance will be provided by the IRS on this issue and what standards may be contained in such guidance. Therefore, we reserve the right to modify the Contract as necessary to attempt to prevent a Contractowner from being considered the owner of a pro rata share of the assets of the Contract.

The Contracts are no longer offered for new sales, but existing Contractowners may continue to make additional Purchase Payments. As such, the Contract is considered to be continuously offered by NNY and the Separate Account.

Prior to the acquisition of FLIAC by NNY, Foresters Financial Services, Inc. (formerly named First Investors Corporation), an affiliate of FLIAC, served as principal underwriter and distributor for the Contracts. As a result of the acquisition of FLIAC by NNY, effective July 1, 2020, 1851 Securities, Inc., an affiliate of NNY, assumed the role of the principal underwriter and distributor for the Contracts. 1851 also serves as principal underwriter and distributor for other variable insurance products issued by NNY and its affiliated companies. NNY or an affiliate thereof reimburses 1851 for expenses that 1851 incurs in distributing variable insurance products of NNY. 1851 does not receive or retain any fees imposed by NNY under variable insurance products issued by NNY; however, 1851 may receive 12b-1 fees or other payments from underlying funds or their affiliates.

1851’s principal executive offices are located at One American Row, PO Box 5056, Hartford, CT 06102. 1851 is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934 (the “1934 Act”), as well as the securities commissions in the states in which it operates and is a member of the Financial Industry Regulatory Authority (“FINRA”).

1851 and NNY have entered into a selling agreement with Cetera Investment Services LLC (“Cetera”) to cover Cetera’s continued servicing of Contracts held by Cetera customers. This agreement also covers Cetera’s sale and servicing of other variable annuity contracts and variable life insurance policies issued by NNY (including those contracts and policies assumed by NNY in connection with the Merger of FLIAC into NNY). Cetera is registered as a broker-dealer with the SEC under the 1934 Act and is a member of FINRA.

Under our agreement with Cetera, we generally pay compensation to Cetera in the form of commissions when a purchase payment is invested in a Contract. We pay a commission of up to 7% on each Purchase Payment, depending on the dollar amount of the Purchase Payment. No other compensation is paid to Cetera with respect to any other Contractowner transactions under the Contract. After the second Contract year, we may also pay Cetera an amount equal to 0.10% of a Contract’s Accumulation Value on an annual basis.

A portion of the compensation paid by NNY to Cetera is used by Cetera to pay commissions or other compensation to its registered representatives who service the Contract, depending on the agreement between Cetera and the registered representative. Such representatives act as appointed agents of NNY under applicable state insurance law and must be licensed to sell variable insurance products. Cetera or a registered representative may receive different compensation for selling or servicing one variable insurance product compared to another.

To the extent permitted by FINRA rules, overrides and promotional incentives or cash and non-cash payments (including training reimbursement or training expenses) also may be made to Cetera based on Purchase Payments invested in the Contract. Additional payments may be made to Cetera that are not directly related to the investment of additional Purchase Payments in the Contract, such as payments related to the recruitment and training of personnel, production of promotional literature and similar services.

The Contract assesses a front-end sales charge on Purchase Payments, so you directly pay for sales and distribution expenses of NNY when you make a Purchase Payment. You also indirectly pay for sales and distribution expenses of NNY through the mortality and expense risk charge under the Contract. Any profits NNY may realize through receiving the mortality and expense risk charge deducted under your Contract may be used to pay for sales and distribution expenses. NNY may also pay for sales and distribution expenses out of any payments NNY or 1851 may receive for providing administrative, marketing and other support and services to the Fund. Currently, neither NNY nor 1851 receive such payments with respect to the Contracts.

Our variable product business is dependent upon the effective operation of our computer systems and those of our business partners, and so our business may be vulnerable to disruptions from utility outages and susceptible to operational and information security risks resulting from information system failures (e.g., hardware and software malfunctions) and cyber-attacks. These risks include, among other things, the theft, misuse, corruption and destruction of data maintained online or digitally, denial of service attacks on websites and other operational disruption and unauthorized release of confidential customer information. Such system failures and cyber-attacks affecting us, the Fund, intermediaries and other affiliated or third-party service providers may adversely affect us and your interest in the Contract.

We are also exposed to risks related to natural and man-made disasters and catastrophes, such as (but not limited to) storms, fires, floods, earthquakes, public health crises, malicious acts and terrorist acts, any of which could adversely affect our ability to conduct business. A natural or man-made disaster or catastrophe, including a pandemic (such as COVID-19), could affect the ability or willingness of our employees or the employees of our service providers to perform their job responsibilities.

We, like other life insurance companies, are subject to regulatory and legal proceedings, including class action lawsuits, in the ordinary course of our business. Such legal and regulatory matters include proceedings specific to us and other proceedings generally applicable to business practices in the industry in which we operate. In some lawsuits and regulatory proceedings involving insurers, substantial damages have been sought and/or material settlement payments have been made. Although the outcome of any litigation or regulatory proceeding cannot be predicted with certainty, at the present time, we believe that there are no pending or threatened proceedings or lawsuits that are likely to have a material adverse impact on the Separate Account or on our ability to meet our obligations under the Contracts or on 1851 in its role as principal underwriter.

Audited financial statements of the Separate Account and NNY are included in the Statement of Additional Information. For a free copy of the Statement of Additional Information, simply call or write to our Administrative Office or contact us through our website at www.NSRE.com. The Statement of Additional Information is also available on the SEC’s website at www.sec.gov.

Supplement dated July 8, 2020 to the
Statement of Additional Information dated April 23, 2002

This supplement updates certain information contained in the Statement of Additional Information (“SAI”), dated April 23, 2002, for the Individual Variable Annuity contracts (“Contracts”) supported by First Investors Life Variable Annuity Fund A (the “Separate Account” or “Separate Account A”), for which there is a related prospectus dated April 23, 2002, as supplemented on July 8, 2020. Please read this supplement and the SAI carefully in conjunction with the prospectus and retain it for future reference. Capitalized terms not otherwise defined in this supplement have the meanings given to them in the SAI.

On July 1, 2020, Nassau Life Insurance Company (“NNY”) acquired Foresters Life Insurance and Annuity Company (“FLIAC”), the issuer of the Contracts. Following the acquisition, on July 8, 2020, FLIAC merged with and into NNY (the “Merger”), with NNY as the surviving company. Upon completion of the Merger, FLIAC’s corporate existence ceased by operation of law. As the surviving company, NNY assumed all the rights, duties and obligations of FLIAC, including those related to the Separate Account. The Separate Account became a separate account of NNY. NNY assumed legal ownership of the assets of the Separate Account and responsibility for the liabilities and obligations of all outstanding Contracts.

The information below describes changes to the SAI as a result of the Merger and otherwise updates the SAI.

NASSAU LIFE INSURANCE COMPANY. NNY is a stock life insurance company organized under the laws of the State of New York. NNY is authorized to conduct life and annuity business in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands. The statutory home office of NNY is located at 15 Tech Valley Drive, East Greenbush, New York 12061.

The immediate parent of NNY is The Nassau Companies of New York, a Delaware corporation. The Nassau Companies of New York is ultimately controlled by David Dominik. Mr. Dominik ultimately controls NNY through the following intervening companies: The Nassau Companies, Nassau Insurance Group Holdings, L.P., Nassau Insurance Group Holdings GP, LLC and Nassau Financial Group L.P. The nature of the business of Mr. Dominik and the intervening companies includes investing in companies engaged in the business of insurance.

On July 1, 2020, NNY acquired FLIAC, which was formerly the depositor of the Separate Account and issuer of the Contracts. Following the acquisition, FLIAC merged with and into NNY, with NNY as the surviving entity. As a result, on July 8, 2020, NNY became the depositor of the Separate Account and issuer of the Contracts.

CUSTODIAN. NNY, subject to applicable laws and regulations, is the custodian of the securities held in the Separate Account. NNY maintains the records and accounts of the Separate Account.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. KPMG LLP, 345 Park Avenue, New York, New York 10154, is the independent registered public accounting firm for the Separate Account. KPMG LLP, 755 Main Street 11th Floor, Hartford, Connecticut 06103 is the independent auditor for NNY.

UNDERWRITER. NNY and the Separate Account have entered into an Underwriting Agreement with 1851 Securities, Inc. (“1851”), which became effective on July 1, 2020, pursuant to which 1851 serves as principal underwriter for the Contracts. 1851, an affiliate of NNY, has its principal business address at One American Row, Hartford, CT 06102. NNY is no longer offering the Contract for new sales, but owners of existing Contracts may continue to make additional Purchase Payments. 1851 does not retain any commissions paid by NNY, but it is reimbursed by NNY for expenses it incurs for performing its underwriting function. 1851 assumed the role of principal underwriter for the Contracts on July 1, 2020. Consequently, it did not receive any commissions from the Separate Account in connection with the distribution of the Contracts during the fiscal years ended December 31, 2017, 2018 or 2019.

Foresters Financial Services, Inc. (“FFS”), an affiliate of FLIAC, was the previous principal underwriter for the Contracts. For the fiscal years ended December 31, 2017, 2018 and 2019, FFS received no underwriting commissions in connection with the distribution of the Contracts.

ADMINISTRATIVE SERVICES. The Nassau Companies of New York (“NCNY”) provides administrative services for the Contracts through a shared service agreement between NNY and NCNY. NCNY’s principal business address is One American Row, Hartford, CT 06102.

The values of the interests of Contractowners under the variable portion of the Contracts will be affected solely by the investment results of the Separate Account. The financial statements of NNY as contained herein should be considered only as bearing upon NNY’s ability to meet its obligations to Contractowners under the Contracts, and they should not be considered as bearing on the investment performance of the Separate Account.

The following audited financial statements of the Separate Account as of December 31, 2019 and for each of the years in the two-year period then ended and the financial highlights for each of the years in the five-year period then ended, and the audited financial statements of NNY as of December 31, 2019 and 2018, and as of December 31, 2018 and 2017, and for each of the years in each of the two-year periods ended December 31, 2019 and December 31, 2018, replace the audited financial statements of First Investors Life Insurance Company and the Separate Account that were previously included in the SAI.

Experts. The above-referenced financial statements of NNY have been included as part of the SAI in reliance upon the reports of KPMG LLP, an independent auditor, and upon the authority of said firm as experts in accounting and auditing. The above-referenced financial statements of First Investors Life Variable Annuity Fund A have been included as part of the SAI in reliance upon the reports of KPMG LLP, independent registered public accounting firm, and upon the authority of said firm as experts in accounting and auditing.

To the Board of Directors of Foresters Life Insurance and Annuity Company and
Contract Owners of First Investors Life Variable Annuity Fund A:

We have audited the accompanying statement of assets and liabilities of the Fund for Income sub-account that comprises the First Investors Life Variable Annuity Fund A (the Separate Account) as of December 31, 2019, the related statement of operations for the year then ended and statements of changes in net assets for the each of the years in the two-year period then ended, and the related notes including the financial highlights in Note 6 for the five-year period then ended (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund for Income sub-account as of December 31, 2019, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period ended December 31, 2019, in conformity with U.S. generally accepted accounting principles.

These financial statements are the responsibility of the Separate Account’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Separate Account in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Such procedures also included confirmation of securities owned as of December 31, 2019, by correspondence with the transfer agent of the underlying mutual funds. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more of Foresters Life Insurance and Annuity Company’s separate accounts since 2011.

FIRST INVESTORS LIFE
VARIABLE ANNUITY FUND A
Statement of Assets and Liabilities
December 31, 2019

FIRST INVESTORS LIFE
VARIABLE ANNUITY FUND A
Statement of Operations
Year ended December 31, 2019

FIRST INVESTORS LIFE
VARIABLE ANNUITY FUND A
Statements of Changes in Net Assets
Years ended December 31, 2019 and 2018

Nassau Life
Insurance Company
(a wholly owned subsidiary of
The Nassau Companies of New York)
Statutory Financial Statements and
Supplemental Schedules
December 31, 2019 and 2018

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Table of Contents

	Page
Statutory Financial Statements:

Independent Auditors’ Report	1-2

Statements of Admitted Assets, Liabilities, Capital and Surplus	3

Statements of Income and Changes in Capital and Surplus	4

Statements of Cash Flows	5

Notes to Statutory Financial Statements	6-44

Supplementary Schedules:

Summary of Investments - Other than Investments in Related Parties	45-46

Supplementary Insurance Information	47

Supplementary Schedule - Reinsurance	48

Independent Auditors’ Report

The Board of Directors
Nassau Life Insurance Company:

We have audited the accompanying financial statements of Nassau Life Insurance Company, which comprise the statutory statements of admitted assets, liabilities, capital and surplus as of December 31, 2019 and 2018, and the related statutory statements of income and changes in capital and surplus, and cash flows for the years then ended, and the related notes to the statutory financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with statutory accounting practices prescribed or permitted by the New York State Department of Financial Services. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles

As described in Note 2 to the financial statements, the financial statements are prepared by Nassau Life Insurance Company using statutory accounting practices prescribed or permitted by the New York State Department of Financial Services, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the financial statements are not intended to be presented in accordance with U.S. generally accepted accounting principles.

The effects on the financial statements of the variances between the statutory accounting practices described in Note 2 and U.S. generally accepted accounting principles, although not reasonably determinable, are presumed to be material.

Adverse Opinion on U.S. Generally Accepted Accounting Principles

In our opinion, because of the significance of the variances between statutory accounting practices and U.S. generally accepted accounting principles discussed in the Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles paragraph, the financial statements referred to above do not present fairly, in accordance with U.S. generally accepted accounting principles, the financial position of Nassau Life Insurance Company as of December 31, 2019 and 2018, or the results of its operations or its cash flows for the years then ended.

Opinion on Statutory Basis of Accounting

In our opinion, the financial statements referred to above present fairly, in all material respects, the admitted assets, liabilities, capital and surplus of Nassau Life Insurance Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for the years then ended, in accordance with statutory accounting practices prescribed or permitted by the New York State Department of Financial Services described in Note 2.

Other Matter

Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The supplementary information included in the Supplemental Schedules: Supplemental Schedule Summary of Investments - Other than Investments in Related Parties, Supplementary Insurance Information, and Supplementary Schedule - Reinsurance, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by Regulation S-X Rule 7-05 of the Securities and Exchange Commission. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audits of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

[(signed) KPMG LLP]

Hartford, Connecticut
April 24, 2020, except for the Supplemental Schedules, as to which the date is July 8, 2020

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Statements of Admitted Assets, Liabilities, Capital and Surplus

	As of
	December 31,
	2019			2018
		(in thousands)
Assets:
Bonds	$	7,015,955		$	7,212,940
Contract loans		2,333,929			2,326,802
Real estate, at depreciated cost		30,859			30,232
Preferred stock		95,933			125,947
Common stock		57,218			58,649
Mortgage loans		400,498			268,735
Cash and short-term investments		100,651			56,891
Other invested assets		344,563			614,915
Receivables for securities		2,620			7,474
Total cash and invested assets		10,382,226			10,702,585
Deferred and uncollected premiums		63,401			68,807
Due and accrued investment income		143,637			145,362
Reinsurance recoverables		8,979			7,214
Deferred tax asset		56,371			57,337
Receivables from affiliates		10,789			22,164
Other assets		8,129			13,994
Separate account assets		1,060,368			942,308
Total assets	$	11,733,900		$	11,959,771

Liabilities:
Reserves for future policy benefits	$	8,936,348		$	9,191,720
Policyholders’ funds		441,780			462,047
Dividends to policyholders		126,939			118,441
Policy benefits in course of settlement		131,144			136,826
Amounts payable on reinsurance		16,570			26,542
Accrued expenses and general liabilities		68,089			62,182
Current federal and foreign income tax		26,128			16,343
Reinsurance funds withheld liability		223,290			232,124
Interest maintenance reserve (“IMR”)		100,226			100,121
Transfers to (from) separate account due and accrued		(305	)		(821	)
Asset valuation reserve (“AVR”)		155,024			157,027
Separate account liabilities		1,060,368			942,308
Total liabilities		11,285,601			11,444,860

Capital and surplus:
Common stock, $1,000 par value (10,000 shares authorized;
10,000 shares issued and outstanding)		10,000			10,000
Paid-in surplus		228,798			228,798
Surplus notes		126,313			126,286
Special surplus funds		2,500			2,500
Unassigned surplus		80,688			147,327
Total surplus		448,299			514,911
Total liabilities, capital and surplus	$	11,733,900		$	11,959,771

The accompanying notes are an integral part of these financial statements.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Statements of Income and Changes in Capital and Surplus

	For the Years Ended
	December 31,
	2019			2018
	(in thousands)
Income:
Premium and annuity considerations	$	249,857		$	251,976
Net investment income		554,889			588,147
Commissions and expense allowances on reinsurance ceded		13,239			13,191
Reserve adjustments on reinsurance ceded		(220,371	)		(254,682	)
Fees associated with separate account and other miscellaneous income		78,364			90,894
Total income		675,978			689,526

Current and future benefits:
Death benefits		464,062			442,092
Disability and health benefits		3,401			4,215
Annuity benefits and matured endowments		14,056			13,340
Surrender benefits		291,017			259,836
Interest on policy or contract funds		12,789			13,285
Settlement option payments		10,141			10,032
Net transfers to (from) separate accounts, net of reinsurance		(75,805	)		(59,976	)
Change in reserves for future policy benefits and policyholders’ funds		(255,384	)		(259,614	)
Total current and future benefits		464,277			423,210

Operating expenses:
Direct commissions		3,192			3,840
Commissions and expense allowances on reinsurance assumed		1,828			1,958
Premium, payroll and miscellaneous taxes		6,786			8,744
Other operating expenses		109,983			80,700
Total operating expenses		121,789			95,242
Net gain (loss) from operations before dividends and federal income taxes		89,912			171,074
Dividends to policyholders		86,675			77,321
Net gain from operations after dividends and before federal income taxes		3,237			93,753
Federal and foreign income tax expense (benefit)		11,308			(1,473	)
Net gain from operations before realized capital gains (losses)		(8,071	)		95,226
Realized capital gains/(losses), net of income taxes and IMR		(6,580	)		(992	)
Net income/(loss)		(14,651	)		94,234

Changes in capital and surplus:
Change in unrealized capital gains (loss), net of tax		14,950			24,872
Change in deferred income taxes		13,722			(17,766	)
Change in non-admitted assets		(11,505	)		23,917
Change in asset valuation reserve		2,003			4,143
Change in surplus notes		26			26
Dividends to stockholder		(60,000	)		(60,000	)
Other surplus changes, net		(11,157	)		(3,761	)
Net increase (decrease) in capital and surplus		(66,612	)		65,665
Capital and surplus, beginning of year		514,911			449,246
Capital and surplus, end of year	$	448,299		$	514,911

The accompanying notes are an integral part of these financial statements.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Statements of Cash Flows

	For the Years Ended
	December 31,
	2019			2018
	(in thousands)
Cash provided by (used for) operations:
Premiums	$	330,241		$	331,153
Investment and other income		571,495			578,759
Claims and benefits		(1,023,643	)		(935,424	)
Dividends paid		(116,452	)		(121,840	)
Commissions and other expenses		(111,756	)		(137,536	)
Net transfers from separate accounts		76,359			60,168
Federal income taxes recovered (paid)		(384	)		(35,663	)
Net cash provided by (used for) operations		(274,140	)		(260,383	)

Cash provided by (used for) investments:
Proceeds from sales, maturities and repayments of bonds		1,026,310			1,332,418
Proceeds from sales, maturities and repayments of stocks		95,822			42,467
Proceeds from sales, maturities and repayments of other invested assets		450,797			100,771
Proceeds from sales, maturities and repayments of other investments		9,934			2,197
Cost of bonds acquired		(822,030	)		(1,146,988	)
Cost of stocks acquired		(59,117	)		(42,257	)
Cost of mortgage loans acquired		(136,520	)		(181,174	)
Cost of other invested assets acquired		(170,339	)		(80,027	)
Cost of other investments acquired		(2,969	)		(1,739	)
Net decrease (increase) in contract loans		(7,127	)		10,420
Net cash provided by (used for) investments		384,761			36,088

Cash provided by (used for) financing and miscellaneous sources:
Net deposits (withdrawals) of deposit-type contracts		(30,331	)		(11,111	)
Dividends to stockholder		(60,000	)		(60,000	)
Other cash provided (applied)		23,470			(3,710	)
Net cash provided by (used for) financing and miscellaneous uses		(66,861	)		(74,821	)
Net increase (decrease) in cash and short-term investments		43,760			(299,116	)
Cash and short-term investments, beginning of year		56,891			356,007
Cash and short-term investments, end of year	$	100,651		$	56,891

The accompanying notes are an integral part of these financial statements.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

1. Description of Business

Phoenix Mutual Life Insurance Company was organized in Connecticut in 1851. In 1992, in connection with its merger with Home Life Insurance Company, the Company re-domiciled to New York and changed its name to Phoenix Home Life Mutual Insurance Company, or Phoenix Home Life. On June 25, 2001, the effective date of its demutualization, Phoenix Home Life converted from a mutual life insurance company to a stock life insurance company, became a wholly owned subsidiary of The Phoenix Companies, Inc. (“Phoenix”), a publicly owned holding company traded on the New York Stock Exchange, and changed its name to Phoenix Life Insurance Company (“PLIC”). As a result of this conversion, PLIC stopped writing traditional participating life insurance business. PLIC also established a closed block (the “Closed Block”) of existing in-force traditional participating life insurance business to protect the future dividends of these policyholders.

On June 20, 2016, Nassau Insurance Group Holdings L.P. (“Nassau” or “Nassau Re”) completed its acquisition of the Nassau Companies of New York (“NCNY” or the “Parent”) after receipt of insurance regulatory approvals from the Connecticut Insurance Department and the New York Department of Financial Services (“NYDFS” or the “Department”). Founded in April 2015, Nassau Re is a privately held insurance and reinsurance business focused on building a franchise across the insurance value chain. Effective March 31, 2019, Nassau Insurance Group Holdings, L.P. (formerly known as Nassau Reinsurance Group Holdings L.P.) contributed NCNY to The Nassau Companies.

Effective October 10, 2018, PLIC changed its name to Nassau Life Insurance Company (“NNY” or the “Company”). Effective November 13, 2018, the Company’s Parent, The Phoenix Companies, Inc. (“Phoenix”), changed its name to The Nassau Companies of New York. The financial statements of NNY are presented on the basis of accounting practices prescribed or permitted by the NYDFS.

NNY is a provider of life insurance and annuity products. The Company’s life insurance products include whole life, universal life, variable universal life and other insurance products. NNY offers single-life and multiple-life products. Most of the Company’s whole life policies were written prior to the demutualization and are part of the Closed Block. The Company also offers annuity products including both deferred and immediate varieties. Deferred annuities accumulate for a number of years before periodic payments begin and enable the contract owner to save for retirement and provide options that protect against outliving assets during retirement. Immediate annuities are purchased by means of a single lump sum payment and begin paying periodic income within the first year.

As is customary in the life insurance industry, the reinsurance program is designed to protect against adverse mortality experience generally and to reduce the potential loss from a death claim on any one life. Risk is ceded to other insurers under various agreements that cover life insurance policies. The amount of risk ceded depends on an evaluation of the specific risk and applicable retention limits.

2. Summary of Significant Accounting Policies Basis of presentation

The significant accounting policies, which are used by NNY in the preparation of the statutory financial statements, are described below.

These financial statements are prepared on the basis of accounting practices (“STAT”) prescribed or permitted by the NYDFS. These practices are predominately promulgated by the National Association of Insurance Commissioners (the “NAIC”). The material practices are prescribed by the NYDFS. These practices differ from accounting principles generally accepted in the United States of America (“U.S. GAAP”). The major differences from U.S. GAAP practices are as follows:

●	The costs related to acquiring business, principally commissions and certain policy issue expenses, are charged to income in the year incurred for STAT and are capitalized as deferred acquisition costs (“DAC”) and then amortized for U.S. GAAP.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

●	Statutory concepts such as non-admitted assets, asset valuation reserve and interest maintenance reserve are recognized only for STAT.

●	Bonds are primarily carried at amortized cost for STAT and at fair value for U.S. GAAP.

●	For certain deposit-type contracts in the accumulation stage and for annuity products, deposits are reported as annuity considerations (a revenue item) for statutory reporting, while U.S. GAAP reports these as deposits via the balance sheet.

●	Reserves for participating life policies are calculated using various methods allowed under statutory accounting.

●	Non-life subsidiaries are recorded based on the underlying audited U.S. GAAP equity of the investee.

●	Under STAT, for universal life, interest sensitive life, variable universal life policies and variable annuity contracts, premiums or deposits are recognized as revenue and withdrawals are recognized as surrender benefits. Benefits, losses and related expenses are matched with premiums over the related contract periods. Amounts received as payments for universal life, variable universal life and other investment-type contracts are considered deposits and are not included in premiums. Withdrawals taken from these contracts are generally considered returns of policyholder account balances and are not included in surrender benefits for U.S. GAAP.

●	Statutory reserves are based on different assumptions than they are under U.S. GAAP.

●	For STAT, the cost of employee pension benefits, including prior service costs, is recognized as the employer contributions are made to fund the costs. Certain costs of employee post-retirement health benefits are recognized over an employee’s service period. For U.S. GAAP, pension and other post-employment benefit costs and obligations are recognized over the employees’ expected service periods by discounting an estimate of aggregate benefits, adjusted by assumed investment rates of return on benefit plan assets, if applicable.

●	Assets and liabilities are reported net of reinsurance balances for STAT and gross for U.S. GAAP.

●	Surplus notes issued by the Company are recorded as a component of surplus for STAT and as debt for U.S. GAAP.

●	The statutory provision for federal income taxes represents estimated amounts currently payable based on taxable income or loss reported in the current accounting period as well as changes in estimates related to prior year taxes. Deferred income taxes are provided in accordance with Statement of Statutory Accounting Principles (“SSAP”) No. 101, Income Taxes, a Replacement of SSAP No. 10R and SSAP No. 10, and changes in deferred income taxes are recorded through surplus. SSAP 101 adopts the U.S. GAAP valuation allowance standard and also limits the recognition of deferred tax assets (“DTAs”) based on certain admissibility criteria. The U.S. GAAP provision would include a provision for taxes currently payable as well as deferred taxes, both of which would be recorded in the income statement. Under SSAP 101, in conjunction with SSAP 5R as modified to replace the “probable” standard with a “more likely than not” standard, companies must establish a liability related to uncertain tax positions where management determines that it is more likely than not a claimed tax benefit would not be sustained if audited. SSAP 101 specifically rejects the corresponding U.S. GAAP guidance. For U.S. GAAP, the Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes. Income tax expense or benefit is recognized based upon amounts reported in the financial statements and the provisions of currently enacted tax laws. Deferred tax assets and/or liabilities are determined by multiplying the differences between the financial reporting and tax reporting bases for assets and liabilities by the enacted tax rates expected to be in effect when such differences are recovered or settled. Valuation allowances on deferred tax assets are recorded to the extent that management concludes that it is more likely than not that an asset will not be realized. We assess all significant tax positions to determine if a liability for an uncertain tax position is necessary and, if so, the impact on the current or deferred income tax balances.

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results will differ from those estimates. Significant estimates used in determining insurance and contractholder liabilities, income taxes, contingencies and valuation allowances for invested assets are discussed throughout the Notes to Statutory Financial Statements. To be consistent with the current year presentation, certain prior year reclassifications have been made.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Recent accounting pronouncements

The Company did not adopt any accounting standards during 2019 that had a material impact on these financial statements.

Going concern

Management has evaluated the Company’s ability to continue as a going concern and concluded that there is not substantial doubt about the Company’s ability to continue as a going concern.

Liquidity and regulatory capital requirements

NCNY serves as the holding company for NNY and does not have any significant operations of its own. In addition to existing cash and securities, the holding company’s primary source of liquidity consists of dividends from NNY. Dividends to the Parent from NNY are limited under the insurance company laws of New York.

NNY is required to report RBC under the insurance company laws of New York. RBC is based on a formula calculated by applying factors to various assets, premium and statutory reserve items taking into account the risk characteristics of the insurer, including asset risk, insurance risk, interest rate risk and business risk. The insurance laws give the states explicit regulatory authority to require various actions by, or take various actions against, insurers whose total adjusted capital does not exceed certain RBC levels. NNY has RBC ratios in excess of the minimum levels required by the applicable insurance regulations.

NCNY committed to its insurance regulator to maintain NNY’s Company Action Level RBC at or above 300% and its surplus to policyholder reserves ratio (excluding separate accounts) at or above 3.5% through 2023. As of December 31, 2019, RBC and surplus to reserve ratios were in excess of these levels.

Dividends to the Parent from NNY are limited under the insurance company laws of New York. In addition to the statutory limitations on paying dividends, the Company also considers the level of statutory capital and RBC of the entity and other liquidity requirements.

New York Insurance Law allows a domestic stock life insurer to distribute an ordinary dividend where the aggregate amount of such dividend in any calendar year does not exceed the greater of 10% of its surplus to policyholders as of the immediately preceding calendar year or its net gain from operations for the immediately preceding calendar year, not including realized capital gains, not to exceed 30% of its surplus to policyholders as of the immediately preceding calendar year. The foregoing ordinary dividend can only be paid out of earned surplus, which is defined as an insurer’s positive unassigned funds, excluding 85% of the change in net unrealized gains or losses less capital gains tax for the preceding year. Under this section, an insurer cannot distribute an ordinary dividend in the calendar year immediately following a calendar year for which the insurer’s net gain from operations, not including realized capital gains, was negative. If a company does not have sufficient positive earned surplus to pay an ordinary dividend, an ordinary dividend can still be paid where the aggregate amount is the lesser of 10% of its surplus to policyholders as of the immediately preceding calendar year or its net gain from operations for the immediately preceding calendar year, not including realized capital gains. Based on this calculation, NNY does not have the capacity to pay dividends in 2020 without prior approval. During the year ended December 31, 2019, NNY declared and paid $60.0 million in dividends to its Parent.

NNY may have less flexibility to pay dividends to the parent company if the Company experiences declines in either statutory capital or RBC in the future. As a result of Nassau’s acquisition of the Company, Nassau committed to the NYDFS that it would seek prior approval for any dividends paid by NNY for a period of seven years.

Investments

Investments are recognized in accordance with methods prescribed by the NAIC.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Investments in bonds include public and private placement bonds and mortgage-backed securities. Bonds with an NAIC designation of 1-5 are carried at amortized cost using the interest method while those with an NAIC designation of 6 are carried at the lower of amortized cost or fair value. Mortgage-backed and structured securities are assigned an NAIC designation in accordance with SSAP No. 43R, Loan-Backed and Structured Securities. Amortized cost for mortgage-backed and structured securities is determined using the interest method, utilizing anticipated cash flows based upon prepayment assumptions. When actual prepayments differ significantly from anticipated prepayments, the effective yield is recalculated to reflect actual payments to date and any resulting adjustment is included in net investment income. Amortization is adjusted for significant changes in estimated cash flows from the original purchase assumptions.

Redeemable and non-redeemable preferred stock that has a NAIC designation of 1-3 is stated at amortized cost. Those with a designation of 4-6 are carried at the lower of amortized cost or fair value.

Common stock is carried at fair value.

Mortgage loans on real estate are carried at the outstanding principal balance, less any allowances for credit losses.

Contract loans are generally reported at their unpaid balances and are collateralized by the cash values of the related policies.

Short-term investments and cash equivalents are carried at amortized cost. NNY considers highly liquid investments purchased between ninety days and one year of maturity to be short-term investments and highly liquid investments purchased ninety days or less of maturity to be cash equivalents.

Other invested assets primarily include ownership interests in limited partnerships and limited liability companies. Interests in limited partnerships and limited liability companies are carried at cost adjusted for NNY’s equity in undistributed earnings or losses since acquisition, less allowances for other-than-temporary declines in value, based upon audited financial statements in accordance with SSAP No. 48, Joint Ventures, Partnerships and Limited Liability Companies. Recognition of net investment income occurs when cash distributions of income are received.

Investments in affiliates represent direct and indirect ownership in the common stock of subsidiaries.

Home office real estate is generally valued at depreciated cost. Depreciation of real estate is calculated using the straight-line method over the estimated lives of the assets (generally 40 years).

Realized capital gains and losses on investments are determined using the first-in, first-out method. Those realized capital gains and losses resulting from interest rate changes are deferred and amortized to income over the stated maturity of the disposed investment utilizing the Interest Maintenance Reserve (“IMR”) Grouped Method. Unrealized capital gains and losses, resulting from changes in the difference between cost and the carrying value of investments, are reflected in the Statements of Income and Changes in Capital and Surplus.

The Company’s accounting policy requires that a decline in the value of a bond or equity security below its cost or amortized cost basis be assessed to determine if the decline is other-than-temporary. In addition, for securities expected to be sold, an other-than-temporary impairment (“OTTI”) charge is recognized if the Company does not expect the fair value of a security to recover to its cost or amortized cost basis prior to the expected date of sale.

Securities that are in an unrealized loss position are reviewed at least quarterly to determine if an OTTI is present based on certain quantitative and qualitative factors. The primary factors considered in evaluating whether a decline in value for securities not subject to SSAP 43R is other-than-temporary include: (a) the length of time and the extent to which the fair value has been less than cost or amortized cost, (b) changes in the financial condition, credit rating and near-term prospects of the issuer, and (c) whether the debtor is current on contractually obligated payments.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

For securities that are not subject to SSAP 43R, if the decline in value of a bond or equity security is other-than-temporary, a charge is recorded in net realized capital losses equal to the difference between the fair value and cost or amortized cost basis of the security. Credit related other-than-temporary impairment losses are recorded through the AVR while interest related other-than-temporary impairment losses are recorded through the IMR.

For certain securitized financial assets with contractual cash flows (including asset-backed securities), SSAP 43R requires the Company to periodically update its best estimate of cash flows over the life of the security. If management determines that its best estimate of expected future cash flows discounted at the security’s effective yield prior to the impairment are less than its amortized cost, then an OTTI charge is recognized equal to the difference between the amortized cost and the Company’s best estimate of expected future cash flows discounted at the security’s effective yield prior to the impairment. The Company’s best estimate of expected future cash flows discounted at the security’s effective yield prior to the impairment becomes its new cost basis. Estimating future cash flows is a quantitative and qualitative process that incorporates information received from third party sources along with certain internal assumptions and judgments regarding the future performance of the underlying collateral. As a result, actual results may differ from estimates. In addition, if the Company does not have the intent and ability to hold a security subject to the provisions of SSAP 43R until the recovery of value, the security is written down to fair value.

Derivatives

Interest Rate Swaps

An interest rate swap is an agreement between two parties to exchange cash flows in the future. Typically, one of the cash flow streams is based on a fixed interest rate set at the inception of the contract, and the other is a floating rate indexed to a reference rate that resets periodically. At the outset of the contract, generally, there is neither an exchange of cash nor a payment of principal by the parties; hence the term “notional principal.” At each settlement date, the fixed and floating interest rates times the notional principal determine the cash flows to be exchanged, and the resulting net payment amount between these interest cash flows is made from one party to the other.

The Company uses interest rate swaps to hedge against market risks in assets or liabilities from substantial changes in interest rates. In an interest rate swap, the Company agrees with another party (referred to as the counterparty) to exchange cash flows at specified intervals for a set length of time, based on the specified notional principal amount.

The Company uses interest rate swaps to hedge exposure to changes in interest rates. The Company uses interest rate swaps to manage interest rate exposure to certain floating rate available-for-sale debt securities where the terms or expected cash flows of the hedged item closely match the terms or expected cash flows of the swap.

The Company values qualified hedges at cost and changes in the value of these hedges are reflected directly through net investment income. For interest rate swaps used to hedge the cash flow variability or reinvestment risks associated with asset purchases, the impact is reflected through net investment income as the difference between income between bond coupons and swap payments.

The Company had no net gain or loss recognized in unrealized gains (losses) during the reporting period resulting from derivatives that no longer qualify for hedge accounting.

The Company had derivatives accounted for as cash flow hedges of forecasted transaction.

The Company had no derivative contracts with financing premiums.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Net investment income

Net investment income primarily represents interest and dividends received or accrued on bonds, common and preferred stock, short-term investments and real estate. It also includes amortization of any purchase premium or discount using the interest method, adjusted retrospectively for any change in estimated yield-to-maturity. For partnership investments, income is earned when cash distributions of income are received. Investment income due and accrued that is deemed uncollectible is charged against net investment income in the period such determination is made, while investment income greater than 90 days past due is non-admitted and charged directly to surplus. There was $0.9 million and $0.3 million due and accrued investment income non-admitted at December 31, 2019 and 2018, respectively.

Non-admitted assets

In accordance with regulatory requirements, certain assets, including certain receivables, certain investments in limited liability companies, certain deferred tax assets, prepaid expenses and furniture and equipment, are not allowable and must be charged against surplus and are reported in the Statements of Income and Changes in Capital and Surplus. Total non-admitted assets at December 31, 2019 and 2018 were $56.2 million and $44.7 million, respectively. Changes for the years ended December 31, 2019 and 2018 were increases of $11.5 million and decreases of $23.9 million, respectively.

Separate accounts

Separate account assets and liabilities are funds maintained in accounts to meet specific investment objectives of contractholders who bear the investment risk. Investment income and investment gains and losses accrue directly to such contractholders. The assets of each account are legally segregated and are not subject to claims that arise out of any other business of NNY. The assets are carried at fair value and the liabilities are set equal to the assets. Net investment income and realized investment gains and losses for these accounts are excluded from revenues, and the related liability increases are excluded from benefits and expenses. Amounts assessed to the contractholders for management services are included in revenues.

Appreciation or depreciation of NNY’s interest in the separate accounts, including undistributed net investment income, is reflected in net investment income. Contractholders’ interests in net investment income and realized and unrealized capital gains and losses on separate account assets are not reflected in net income.

NNY’s separate account products include variable annuities and variable life insurance contracts. Many of NNY’s variable annuity contracts offer various guaranteed minimum death, accumulation, withdrawal and income benefits. The Company currently reinsures a significant portion of the death benefit guarantees associated with its in-force block of business. Reserves for the guaranteed minimum death, accumulation, withdrawal and income benefits are determined in accordance with Actuarial Guideline 43.

Insurance liabilities

Benefit and loss reserves, included in reserves for future policy benefits, are established in amounts adequate to meet estimated future obligations on policies in force. Benefits to policyholders are charged to operations as incurred.

Reserves for future policy benefits are determined using assumed rates of interest, mortality and morbidity consistent with statutory requirements. Most life insurance reserves for which the 1958 CSO and 1980 CSO mortality tables are used as the mortality basis are determined using a modified preliminary term reserve method. The net level premium method is used in determining life insurance reserves based on earlier mortality tables. For certain products issued on or after January 1, 2000, NNY adopted the 20 year select factors in the NAIC Valuation of Life Insurance Policies Model Regulation for both the basic and the deficiency reserve, and NNY’s X factors for the deficiency reserve. Annuity reserves principally use Actuarial Guideline (AG) 33 and 43 to calculate reserve balances. AG33 uses prescribed methods and assumptions to determine the minimum statutory reserves. AG43 requires that reserves for contracts are based on the greater of the Standard Scenario Amount (SSA) and the Conditional Tail Expectation Amount (CTE). The Company holds reserves greater than those developed under the minimum statutory reserving rules when it is determined that the minimum statutory reserves are inadequate. Actual results could differ from these estimates and may result in the establishment of additional reserves. The Company monitors actual experience and, where circumstances warrant, revises assumptions and the related estimates for policy reserves.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

As of December 31, 2019, the Company calculated its reserves for variable annuity products under the SSA of AG43, which exceeded the CTE scenario. As of December 31, 2018, the Company calculated its reserves under the CTE scenario.

Claim and loss liabilities, included in reserves for future policy benefits, are established in amounts estimated to cover incurred losses. These liabilities are based on individual case estimates for reported losses and estimates of unreported losses based on past experience.

Fees associated with separate accounts and other miscellaneous income

Fees consist of contract charges assessed against the fund values and are recognized, when earned.

Premium income and related expenses

Generally, premium income and annuity considerations are recognized as income when due. Related underwriting expenses, commissions and other costs of acquiring the policies and contracts are charged to operations as incurred. For certain deposit-type variable contracts in the accumulation stage, NNY reports deposits as revenues and withdrawals as benefits. This method of reporting applies to deposits and withdrawals for both general account activity and transfers to/from the separate accounts.

Stockholder dividends

During 2019 and 2018, the Company paid cash dividends of $60.0 million and $60.0 million, respectively, to its parent, Nassau.

Reinsurance

NNY utilizes reinsurance agreements to provide for greater diversification of business, allow management to control exposure to potential losses arising from large risks and provide additional capacity for growth. Reinsurance arrangements do not relieve the Company as primary obligor for policyholder liabilities.

Assets and liabilities related to reinsurance ceded contracts are reported on a net basis.

Policyholder dividends

Certain life insurance policies contain dividend payment provisions that enable the policyholder to participate in the earnings of NNY. The amount of policyholder dividends to be paid is determined annually by NNY’s Board of Directors. The aggregate amount of policyholder dividends is related to the actual interest, mortality, morbidity and expense experience for the year and NNY’s judgment as to the appropriate level of statutory surplus to be retained (see Note 3 – “Significant Transactions, Closed Block”).

Income taxes

The Company is included in the consolidated federal income tax return of NCNY and its subsidiaries. The method of allocation among affiliates of the Company is subject to written agreement approved by the Board of Directors and based upon separate return calculations with current credit for net losses to the extent the losses provide a benefit in the consolidated tax return.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Deferred income taxes result from temporary differences between the tax basis of assets and liabilities and their recorded amounts for financial reporting purposes. Deferred tax assets are admitted in accordance with the admissibility test prescribed by SSAP 101. The change in deferred tax is recorded as a component of surplus.

Employee benefit plans

NCNY sponsors a non-contributory, defined benefit pension plan. Retirement benefits are a function of both years of service and level of compensation. NCNY also sponsors a non-qualified supplemental defined benefit plan to provide benefits in excess of amounts allowed pursuant to the Internal Revenue Code. NCNY’s funding policy is to contribute annually an amount equal to at least the minimum required contribution in accordance with minimum funding standards established by the Employee Retirement Income Security Act of 1974 (“ERISA”). NCNY also provides certain health care and life insurance benefits for active employees.

In addition to its defined benefit plans, NCNY historically provided certain health care and life insurance benefits to eligible retired employees, spouses and other eligible dependents. In September 2018, participants in the plan were notified that benefits under the plan will be terminated effective January 1, 2019.

The Company participates in a qualified, noncontributory defined benefit pension plan and a non-qualified supplemental defined benefit plan sponsored by its parent, NCNY. For purposes of statutory accounting, the Company has no legal obligation for benefits under these plans. The Company’s share of net expenses for these plans was $5.7 million and $8.4 million for 2019 and 2018, respectively.

Nassau Re employees are covered by a qualified defined contribution plan sponsored by the Company’s parent, NCNY. Effective January 1, 2018, NCNY’s match percentage was changed to dollar for dollar to a maximum of 5% of eligible 401(k) earnings. Previously, contributions made by employees were matched, up to 150% on the first 6% of base compensation. The Company’s contribution for the plan was $1.1 million and $0.8 million for 2019 and 2018, respectively.

The Company historically provided certain other postretirement benefits to retired employees through a plan sponsored by its parent, NCNY. For purposes of statutory accounting, the Company has no legal obligation for benefits under this plan. The Company had net benefits of $0.2 million and $18.6 million for 2019 and 2018, respectively. 2018 included the impact from a curtailment of benefits.

Applicable information regarding the actuarial present value of vested and non-vested accumulated plan benefits and the net assets of the plans available for benefits is omitted, as the information is not separately calculated for NNY’s participation in the plans. NCNY, the plan sponsor, establishes an accrued liability and charges any applicable employee benefit expenses to NNY through a cost allocation process. Effective March 31, 2010, all benefit accruals under the funded and unfunded defined benefit plans were frozen.

ASO Uninsured portion of partially insured plans

The total net expense, loss from operations and claim payment volume from the Administrative Services Only (“ASO”) uninsured portion of partially insured plans was insignificant for the year ended December 31, 2019.

Surplus

The portion of unassigned surplus represented or (reduced) by cumulative unrealized gains (losses) was $56.9 million and $97.8 million as of December 31, 2019 and 2018, respectively.

Pursuant to SSAP No. 72, Surplus and Quasi-Reorganizations, in accordance with the change in control discussed in Footnote 1, the Company reclassified its negative unassigned surplus balance of $896.9 million to gross paid-in and contributed surplus as of June 30, 2016, which had the effect of setting the Company’s statutory unassigned surplus to zero as of this date. This change in accounting was approved by the NYDFS. This change had no immediate impact on dividend capacity and no impact to risk based capital.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Non-cash items

The Statements of Cash Flows exclude non-cash items, such as the following:

●	Non-cash investment transactions, such as tax-free exchanges;

●	Accretion of amortization or accrual of discount for investments;

●	Depreciation expense;

●	Modified coinsurance (“MODCO”) reinsurance adjustments, including inception ceded/assumed premium amounts; and

●	Accruals of capital contributions approved by the domiciliary commissioner.

The Statements of Cash Flows exclude the following significant non-cash items for the years ended December 31, 2019 and 2018:

●	$82.7 million and $79.7 million of non-cash investment exchanges as of December 31, 2019 and 2018, respectively.

3. Significant Transactions

Closed block

On the date of demutualization, NNY established the closed block for the benefit of holders of certain individual participating life insurance policies and annuities of NNY for which NNY had a dividend scale payable at the time of demutualization. Assets were allocated to the closed block in an amount that will produce cash flows which, together with anticipated revenues from the policies included in the closed block, are reasonably expected to be sufficient to support obligations and liabilities relating to these policies. This includes, but is not limited to, provisions for the payment of claims and certain expenses and taxes, and to provide for the continuation of policyholder dividend scales in effect at the time of demutualization, if the experience underlying such dividend scales continues, and for appropriate adjustments in such scales if such experience changes. The closed block assets, the cash flows generated by the closed block assets and the anticipated revenues from the policies in the closed block will benefit only the holders of the policies in the closed block. To the extent that, over time, cash flows from the assets allocated to the closed block and claims and other experience related to the closed block are, in the aggregate, more or less favorable than what was assumed when the closed block was established, total dividends paid to closed block policyholders in the future may be greater than or less than the total dividends that would have been paid to these policyholders if the policyholder dividend scales in effect at the time of demutualization had been continued. Any cash flows in excess of amounts assumed will be available for distribution over time to closed block policyholders and will not be available to stockholders. If the closed block has insufficient funds to make guaranteed policy benefit payments, such payments will be made from assets outside of the closed block. The closed block will continue in effect as long as any policy in the closed block remains in force.

The excess of closed block liabilities over closed clock assets at the effective date of the demutualization represents the estimated maximum future earnings from the closed block expected to result from operations attributed to the closed block after income taxes. Earnings of the closed block are recognized in income over the period the policies and contracts in the closed block remain in force. Management believes that over time the actual cumulative earnings of the closed block will approximately equal the expected cumulative earnings due to the effect of dividend changes. If, over the period the closed block remains in existence, the actual cumulative earnings of the closed block are greater than the expected cumulative earnings of the closed block, NNY will pay the excess of the actual cumulative earnings of the closed block over the expected cumulative earnings to closed block policyholders as additional policyholder dividends unless offset by future unfavorable experience of the closed block. If over such period, the actual cumulative earnings of the closed block are less than the expected cumulative earnings of the closed block, NNY will recognize only the actual earnings in income.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

The principal cash flow items that affect the amount of closed block assets and liabilities are premiums, net investment income, purchases and sales of investments, policyholders’ benefits, policyholder dividends, premium taxes and income taxes. The principal income and expense items excluded from the closed block are management and maintenance expenses, commissions, and investment income and realized investment gains and losses of investment assets outside the closed block that support the closed block business.

Pending acquisition

On October 17, 2019, the Company announced the signing of a definitive agreement with The Independent Order of Foresters (“Foresters”) for NNY to acquire Foresters Financial Holding Company, Inc. and Foresters Life Insurance and Annuity Company from Foresters. The transaction is subject to customary closing conditions, including regulatory approval by the New York State Department of Financial Services.

4. Investments

Information pertaining to NNY’s investments, net investment income and capital gains and losses on investments follows.

Bonds, common stock and preferred stock

The carrying value and fair value of investments in bonds, common and preferred stock as of December 31, 2019 were as follows:

	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in thousands)
U.S. government	$	217,344	$	16,763	$	(744	)	$	233,363
All other governments		58,433		8,323		—			66,756
States, territories and possessions		40,104		5,856		—			45,960
Political subdivisions of states, territories
and possessions		61,380		7,985		(68	)		69,297
Special revenue		461,712		46,866		(277	)		508,301
Industrial and miscellaneous (unaffiliated)		3,977,928		375,458		(8,188	)		4,345,198
Parent, subsidiaries and affiliates		15,300		217		(2,063	)		13,454
Hybrid securities		243,211		15,232		(2,716	)		255,727
Mortgage-backed and asset-backed securities		1,940,543		57,040		(16,904	)		1,980,679
Total bonds	$	7,015,955	$	533,740	$	(30,960	)	$	7,518,735

Preferred stock	$	95,933	$	9,050	$	—		$	104,983
Common stock	$	57,218	$	—	$	—		$	57,218

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

The carrying value and fair value of investments in bonds, common and preferred stock as of December 31, 2018 were as follows:

			Gross		Gross
	Carrying		Unrealized		Unrealized			Fair
	Value		Gains		Losses			Value
	(in thousands)
U.S. government	$	208,346	$	8,074	$	(1,131	)	$	215,289
All other governments		77,571		2,693		(742	)		79,522
States, territories and possessions		40,594		2,328		(651	)		42,271
Political subdivisions of states, territories
and possessions		67,174		3,254		(481	)		69,947
Special revenue		495,300		24,727		(4,214	)		515,813
Industrial and miscellaneous (unaffiliated)		4,219,702		107,656		(138,222	)		4,189,136
Parent, subsidiaries and affiliates		14,575		206		(2,159	)		12,622
Hybrid securities		230,896		1,716		(21,254	)		211,358
Mortgage-backed and asset-backed securities		1,858,782		21,106		(41,138	)		1,838,750
Total bonds	$	7,212,940	$	171,760	$	(209,992	)	$	7,174,708

Preferred stock	$	125,947	$	3,283	$	(1,349	)	$	127,881
Common stock	$	58,649	$	—	$	—		$	58,649

The gross unrealized capital gains (losses) on bonds and preferred stock were not reflected in surplus for the years ended December 31, 2019 and 2018.

The aging of temporarily impaired general account debt securities as of December 31, 2019 was as follows:

	Less than 12 months					Greater than 12 months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(in thousands)
Debt Securities
U.S. government	$	4,365	$	(742	)	$	1,186	$	(2	)	$	5,551	$	(744	)
Political subdivisions		405		(10	)		2,660		(58	)		3,065		(68	)
Special revenue		2,189		(30	)		7,003		(247	)		9,192		(277	)
Industrial and miscellaneous (unaffiliated)		39,498		(2,854	)		89,579		(5,334	)		129,077		(8,188	)
Parent, subsidiaries and affiliates		9,298		(1,476	)		2,805		(587	)		12,103		(2,063	)
Hybrid securities		3,319		(7	)		32,168		(2,709	)		35,487		(2,716	)
Mortgage-backed and asset-backed securities		180,628		(2,065	)		351,703		(14,839	)		532,331		(16,904	)
Total bonds	$	239,702	$	(7,184	)	$	487,104	$	(23,776	)	$	726,806	$	(30,960	)
Number of positions at unrealized loss				115					165					280

Preferred stock	$	—	$	—		$	—	$	—		$	—	$	—

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The Company reported $21.5 million and $19.6 million of gross unrealized gains and $1.0 million and $2.0 million of gross unrealized losses related to common stock for the periods ended December 31, 2019 and 2018, respectively, which reflected the difference between cost and fair value for common stock. For the period ended December 31, 2019, the fair value of common stock securities in a continuous unrealized loss position for less than 12 months was $0.7 million with unrealized losses of $0.7 million and the fair value of common stock securities in a continuous unrealized loss position for greater than 12 months was $3.9 million with unrealized losses of $0.3 million.

At December 31, 2019, there are 11 below investment grade debt securities that have been in an unrealized loss position for greater than 12 months. Below investment grade unrealized losses greater than 12 months are $2.8 million. Available-for-sale securities in an unrealized loss position for over 12 months consisted of 165 securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor do we believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, we expect to recover the entire amortized cost basis of these securities. In our evaluation of each security, management considered the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary.

The aging of temporarily impaired general account debt securities as of December 31, 2018 was as follows:

	Less than 12 months					Greater than 12 months					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
							(in thousands)
Debt Securities
U.S. government	$	64,366	$	(870	)	$	6,548	$	(261	)	$	70,914	$	(1,131	)
All other governments		31,770		(729	)		1,987		(13	)		33,757		(742	)
States, territories and possessions		15,852		(650	)		99		(1	)		15,951		(651	)
Political subdivisions		7,842		(278	)		6,174		(203	)		14,016		(481	)
Special revenue		116,932		(2,588	)		27,110		(1,626	)		144,042		(4,214	)
Industrial and miscellaneous (unaffiliated)		2,049,886		(106,405	)		306,222		(31,817	)		2,356,108		(138,222	)
Parents, subsidiaries and affiliates		11,306		(2,159	)		—		—			11,306		(2,159	)
Hybrid securities		118,938		(12,725	)		66,708		(8,529	)		185,646		(21,254	)
Mortgage-backed and asset-backed securities		715,785		(22,243	)		489,872		(18,895	)		1,205,657		(41,138	)
Total bonds	$	3,132,677	$	(148,647	)	$	904,720	$	(61,345	)	$	4,037,397	$	(209,992	)
Number of positions at unrealized loss				943					306					1,249

Preferred stock	$	50,298	$	(1,349	)	$	—	$	—		$	50,298	$	(1,349	)

For the period ended December 31, 2018, the fair value of common stock securities in a continuous unrealized loss position for less than 12 months was $6.4 million with unrealized losses of $0.5 million. The Company had $2.5 million common stock securities in a continuous unrealized loss position for greater than 12 months with unrealized losses of $1.5 million.

For the period ended December 31, 2018, there are 30 below investment grade debt securities that have been in an unrealized loss position for greater than 12 months, and below investment grade unrealized losses greater than 12 months are $10.7 million.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

As of December 31, 2018, available-for-sale securities in an unrealized loss position for over 12 months consisted of 306 securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor do we believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, we expect to recover the entire amortized cost basis of these securities. In our evaluation of each security, management considered the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary.

The carrying value and fair value of bonds as of December 31, 2019 by maturity are shown below.

	Carrying Value		Fair Value
	(in thousands)
Due in one year or less.	$	277,098	$	286,604
Due after one year through five years		1,526,921		1,593,413
Due after five years through ten years		2,418,369		2,537,054
Due after ten years		2,793,567		3,101,664
Total	$	7,015,955	$	7,518,735

Corporate bonds are shown based on contractual maturity or contractual sinking fund payments. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties, or NNY may have the right to put or sell the obligations back to the issuers. Mortgage and asset-backed securities (“ABS”) are not due at a single maturity date and therefore are shown based on the expected cash flows of the underlying loans, which includes estimates of anticipated future prepayments.

The carrying values of securities impaired during the year were $14.8 million and $7.4 million as of December 31, 2019 and 2018, respectively. OTTIs were $19.1 million and $11.4 million in 2019 and 2018, respectively.

Internal and external prepayment models, which are widely accepted by the industry, are used in calculating the effective yield used in determining the carrying value of mortgage-backed and asset-backed securities. The retrospective method is applied in determining the prepayment adjustment.

Loan-backed securities

The Company has elected to use the book value as of January 1, 1994 as the cost for applying the retrospective adjustment method to securities purchased prior to that date, where historical cash flows are not readily available.

Prepayment assumptions for loan-backed structured securities were obtained from industry prepayment models or internal estimates. These assumptions are consistent with current interest rates and the economic environment. The retrospective adjustment method is used to value these securities.

As of December 31, 2019, the Company had no OTTI recognized because the present value of cash flows expected to be collected is greater than the amortized cost basis of the securities.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Real estate and mortgage loans

Real estate, which represents the home office used in Nassau’s operations, carried net of accumulated depreciation and encumbrances, as of December 31 is summarized below:

	2019		2018
	(in thousands)
Real estate	$	30,859	$	30,232
Total real estate	$	30,859	$	30,232

The Company invests in mortgage loans that are collateralized by commercial properties, including multi-family residential buildings, which are managed as a single class of commercial mortgage loans. Mortgage loans are stated at original cost, net of principal payments and amortization. The Company segregates its portfolio by property type and geographic location. As of December 31, 2019 and 2018, the Company had $400.5 million and $268.7 million, respectively, in mortgage loans. The allowance for loans at December 31, 2019 was $0.8 million. There was 0.5 million allowance for loan losses at December 31, 2018.

The following tables reflect the distribution of mortgage loans by property type as of December 31:

	2019		2018
	(in millions)
Industrial	$	21.2	$	13.5
Multifamily		63.8		53.9
Office		72.0		58.4
Retail		132.6		58.4
Self-storage		19.0		11.0
Warehouse		53.0		53.2
Other		39.7		20.8
Total mortgage loans		401.3		269.2
Less: Valuation allowance		0.8		0.5
Net mortgage loans	$	400.5	$	268.7

The following tables reflect the distribution of mortgage loans by geographic region as of December 31:

	2019		2018
	(in millions)
East North Central	$	39.8	$	37.1
Middle Atlantic		21.1		10.2
Mountain		54.4		37.1
New England		3.1		3.2
Pacific		113.9		83.2
South Atlantic		89.2		51.4
West North Central		6.2		6.2
West South Central		73.6		40.8
Total mortgage loans		401.3		269.2
Less: Valuation allowance		0.8		0.5
Net mortgage loans	$	400.5	$	268.7

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

To monitor credit quality, the Company primarily uses RBC code, which is the risk category used in the RBC calculation that is based on debt service coverage ratio and loan-to-value. The codes range from CM1 to CM7, with CM1 being the most stable. The Company holds $366.7 million CM1 loans and $34.6 million CM2 loans as of December 31, 2019. The Company held $243.3 million CM1 loans and $25.9 million CM2 loans as of December 31, 2018. The maximum percentage of any one loan to the value of the collateral security at the time of the loan, exclusive of insured, guaranteed or purchase money mortgages, acquired during 2019 was 87%. As of December 31, 2019, all loans were current.

During 2019, the minimum and maximum lending rates for mortgage loans were 3.7% and 6.8% respectively. There were no taxes, assessments, or amounts advanced not included in the mortgage loan total. There were no impairments on mortgage loans or any loans derecognized as a result of foreclosure and there was no allowance for loan losses for the year ended December 31, 2019.

Other invested assets

Other invested assets as of December 31 are summarized below:

	2019		2018
	(in thousands)
Private equity	$	53,982	$	265,511
Mezzanine partnerships		9,852		148,320
Infrastructure funds		10,946		27,611
Hedge funds		6,811		6,980
Collateralized fund obligation		97,400		—
Mortgage and real estate		871		898
Direct equity		129,534		141,727
Credit funds		22,105		8,432
Other alternative assets		13,062		15,436
Total other invested assets	$	344,563	$	614,915

The Company has unfunded commitments related to its investments in limited partnerships in the amount of $80.2 million and $152.3 million as of December 31, 2019 and 2018, respectively. The Company has no investments in joint ventures, partnerships or limited liability companies that exceed 10% of its admitted assets.

Derivative instruments

Derivative instruments as of December 31 are summarized below:

	2019		2018
	(in thousands)
Swaps:
Notional amount	$	75,000	$	75,000
Fair value	$	6,843	$	1,951
Carrying value	$	—	$	—

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

NNY is exposed to credit risk in the event of nonperformance by counterparties to these financial instruments. NNY does not expect its counterparties to fail to meet their financial obligations because the Company contracts with highly rated counterparties. The credit exposure of these instruments is the positive market value at the reporting date. Management of NNY considers the likelihood of any material loss due to credit risk on these guarantees, interest rate swaps or floors to be remote.

Restricted assets

Restricted assets (including pledged) relate mainly to statutory requirements of various jurisdictions, FHLB Stock and derivative collateral. Restricted assets were $6.1 million and $8.0 million as of December 31, 2019 and 2018, respectively. These are included as assets on the Statements of Admitted Assets, Liabilities, and Capital and Surplus.

The Company is a member of the Federal Home Loan Bank (“FHLB”) of Boston. Membership with the FHLB is part of the Company’s strategy to access funds to support various spread-based businesses and enhance liquidity management. The Company has determined the estimated maximum borrowing capacity as $593.9 million. The Company calculated this amount in accordance with New York Consolidated Laws, Insurance Law - ISC § 1411. Authorization of, and Restrictions on, 1nvestments, whereby the loan shall not exceed, when the loan is made, 5% of its admitted assets as shown by its last sworn statement to the superintendent. During 2019, the Company had maximum collateral pledged with fair value of $73.7 million and carrying value of $70.2 million. The amount borrowed at the time of maximum collateral was $39 million. As of December 31, 2019, the Company had no outstanding borrowings with the FHLB and no amounts pledged. The Company owned $2.3 million and $3.4 million of FHLB capital stock as of December 31, 2019 and 2018, respectively, which was not eligible for redemption.

5GI Securities

NAIC 5GI is assigned by an insurance company to certain obligations that meet all of the following criteria: (1) documentation necessary to permit a full credit analysis of a security by the NAIC Securities Valuation Office (“SVO”) does not exist or an NAIC Credit Rating Provider (“CRP”) credit rating for a Filing Exemption (“FE”) or Private Letter (“PL”) security is not available; and (2) the issuer or obligor is current on all contracted interest and principal payments; and (3) the insurer has an actual expectation of ultimate payment of all contracted interest and principal.

5GI securities as of December 31 are summarized below:

	Number of 5GI Securities		Aggregate BACV				Aggregate Fair Value
Investment	Current Year	Prior Year	Current Year		Prior Year		Current Year		Prior Year
	(in thousands)
(1) Bonds - Amortized Cost	11	30	$	8,661	$	13,676	$	8,818	$	13,205
(2) Loan-backed and structured securities - Amortized Cost	—	—		—		—		—		—
(3) Preferred Stock - Amortized Cost	1	—		—		—		40		—
(4) Preferred Stock - Fair Value	1	—		12		—		12		—
(5) Total (1+2+3+4)	13	30	$	8,673	$	13,676	$	8,870	$	13,205

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Concentrations of credit risk of financial instruments

Credit exposure related to issuers and derivatives counterparties is inherent in investments and derivative contracts with positive fair value or asset balances. We manage credit risk through the analysis of the underlying obligors, issuers and transaction structures. We review our debt security portfolio regularly to monitor the performance of obligors and assess the stability of their credit ratings. We also manage credit risk through industry and issuer diversification and asset allocation. We classify debt securities into investment grade and below-investment-grade securities based on ratings prescribed by the NAIC. In a majority of cases, these classifications will coincide with ratings assigned by one or more Nationally Recognized Statistical Rating Organizations (“NRSROs”); however, for certain structured securities, the NAIC designations may differ from NRSRO designations based on the amortized cost of the securities in our portfolio. Maximum exposure to an issuer or derivative counterparty is defined by quality ratings, with higher quality issuers having larger exposure limits. As of December 31, 2019, we were not exposed to the credit concentration risk of any issuer other than U.S. government and government agencies backed by the faith and credit of the U.S. government, defined as exposure greater than 10% of total admitted assets. The top five largest exposures were HP Communities LLC., Wells Fargo & Company, Anheuser Busch Company, Prudential Financial Inc. and Burlington Northern & Sante Fe. We monitor credit exposures by actively monitoring dollar limits on transactions with specific counterparties. We have an overall limit on below-investment-grade rated issuer exposure. Additionally, the creditworthiness of counterparties is reviewed periodically. We use ISDA Master Agreements with derivative counterparties which may include Credit Support Annexes with collateral provisions to reduce counterparty credit exposures. To further mitigate the risk of loss on derivatives, we only enter into contracts in which the counterparty is a financial institution with a rating of A or higher from at least one NRSRO.

Net investment income

The principal components of net investment income for the years ended December 31 were as follows:

	2019		2018
	(in thousands)
Bonds	$	328,888	$	348,400
Contract loans		182,662		175,413
Cash and short-term investments		4,492		588
Real estate, net of expenses		4,996		1,312
Preferred stock		6,260		7,496
Common stock		2,881		18
Mortgage loans		13,886		8,714
Other invested assets		26,030		59,449
Derivative instruments		443		423
Miscellaneous income		1,473		1,968
Amortization of interest maintenance reserve ("IMR")		13,013		14,478
Less:
Interest expense		9,086		9,086
Other investment expenses		21,049		21,026
Net investment income		554,889		588,147

For the year ended December 31, 2019, the Company had 13 securities called or redeemed by the issuer, resulting in income from prepayment penalties and acceleration fees of $1.6 million.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Capital gains and losses

The principal components of realized gains (losses) and changes in unrealized capital gains (losses) on investments for the years ended December 31 were as follows:

	Realized						Change in Unrealized
	2019			2018			2019			2018
	(in thousands)
Bonds	$	(7,752	)	$	2,054		$	1,373		$	(1,252	)
Preferred stock		(2,202	)		364			2,332			(2,474	)
Common stock		2,207			(235	)		2,936			8,413
Mortgage loans		(258	)		(540	)		—			—
Other invested assets		341			(63	)		12,275			26,851
Derivative instruments		(255	)		—			—			—
Foreign exchange		(23	)		(370	)		8			(54	)
Miscellaneous		223			(640	)		—			—
		(7,719	)		570			18,924			31,484
Income tax benefit (expense)		1,139			(1,562	)		(3,974	)		(6,612	)
Net capital gains (losses)	$	(6,580	)	$	(992	)	$	14,950		$	24,872

Realized losses for 2019 include impairments of $19.1 million, including impairments on bonds of $14.2 million, common stock of $1.8 million and preferred stock of $3.1 million. Realized losses for 2018 include impairments of $11.4 million, including impairments on bonds of $5.8 million, common stock of $5.6 million, preferred stock of $0 and other invested assets of $0.

The proceeds and related gross realized gains and losses from sales of stocks and bonds, for the years ended December 31 were as follows:

	2019		2018
	(in thousands)
Proceeds from sales	$	1,201,293	$	1,454,353
Gross gains on sales.		34,252		21,989
Gross losses on sales		29,917		25,652

5. Investments in Affiliates

The Company has an investment subsidiary, Nassau 2019 CFO LLC and uses the “look through” process, per Paragraph 26 of SSAP No. 97, Investments in Subsidiary, Controlled and Affiliated Entities, to admit the underlying assets of that subsidiary. The Company’s other subsidiary, PM Holdings, has no underlying value ascribed to it. There was no subsidiary equity that was non-admitted as of December 31, 2019 and 2018.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

6. Reserves for Future Policy Benefits

The basis of assumptions for NNY’s major categories of reserves for future policy benefits and claims and settlements as of December 31 is summarized below:

	2019		2018
	(in thousands)
Life insurance:
American Experience, 2.5% to 4.0%	$	1,258	$	1,532
1941 CSO, 2.25% to 4.0%		90,967		100,855
1958 CSO, 2.0% to 6.0%		1,473,056		1,541,961
1980 CSO, <4.5% to 6.0%		2,815,762		2,964,819
1980 CSO Select, 4.5%		37,279		38,718
1980 CSO, 3.5% to 4.5%		4,427,550		4,444,192
2001 CSO 4.0% to 4.25%		58,247		56,642
Various		13,501		18,384
Total life insurance	$	8,917,620	$	9,167,103

Annuities		207,258		218,710

Claim and loss liabilities:
Disability		27,828		31,496
Accident and health		29,980		35,621
Total claim and loss liabilities		57,808		67,117
Subtotal		9,182,686		9,452,930
Supplementary contracts with life contingencies		84,624		83,999
All other		5,050		7,382
Total before reinsurance ceded		9,272,360		9,544,311
Less: Reinsurance ceded		336,012		352,591
Reserves for future policy benefits	$	8,936,348	$	9,191,720

NNY waives deduction of deferred fractional premiums upon death of the insured and returns any portion of the final premium beyond date of death. Surrender values promised in excess of legally computed reserves have been included in miscellaneous reserves.

For a policy on which the substandard extra premium is based upon a multiple of standard mortality, the substandard extra reserve is based upon the excess of such multiple over standard mortality. For a policy carrying a flat extra premium, the extra reserve is one half of the flat extra premium.

The amount of individual insurance in force as of December 31, 2019 and 2018 for which the net premium exceeded the gross premium was $0.6 billion and $0.8 billion, respectively. As of December 31, 2019 and 2018, the Company carried an associated premium deficiency reserve of $3.5 million and $4.3 million, respectively, included in reserves for future policy benefits. Anticipated investment income was utilized in the calculation.

Tabular cost has been determined from the basic data for the calculation of policy reserves. Tabular less actual reserves released has been determined from the basic data for the calculation of reserves and reserves released. Tabular interest has been determined from the basic data for the calculation of policy reserves.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Withdrawal characteristics

Withdrawal characteristics of annuity actuarial reserves and deposit liabilities as of December 31 are as follows:

	2019
			Separate		Separate
			Account		Account
	General		with		Non-
	Account		Guarantees		guaranteed		Total		% of total
	(in thousands)
Individual Annuities
Subject to discretionary withdrawal:
- with market value adjustment	$	14,928	$	6,930	$	—	$	21,858	4	%
- at book value less surrender charge of 5% or more		—		—		—		—	—	%
- at market value		—		—		313,234		313,234	56	%
Subtotal		14,928		6,930		313,234		335,092	60	%

Subject to discretionary withdrawal - without adjustment:
- at book value (minimal or no charge or adjustment)		132,949		—		—		132,949	23	%
Not subject to discretionary withdrawal		91,668		—		3,166		94,834	17	%
Total individual annuity actuarial reserves		239,545		6,930		316,400		562,875	100	%
Less: Reinsurance ceded		8,814		—		—		8,814
Total individual annuity actuarial reserves, net of reinsurance	$	230,731	$	6,930	$	316,400	$	554,061

	2019
			Separate		Separate
			Account		Account
	General		with		Non-
	Account		Guarantees		guaranteed		Total		% of total
	(in thousands)
Group Annuities
Subject to discretionary withdrawal:
- with market value adjustment	$	—	$	—	$	—	$	—	—	%
- at book value less surrender charge of 5% or more		—		—		—		—	—	%
- at market value		—		—		1,454		1,454	3	%
Subtotal		—		—		1,454		1,454	3	%

Subject to discretionary withdrawal - without adjustment:
- at book value (minimal or no charge or adjustment)		23,822		—		—		23,822	44	%
Not subject to discretionary withdrawal		28,513		—		—		28,513	53	%
Total group annuity actuarial reserves		52,335		—		1,454		53,789	100	%
Less: Reinsurance ceded		—		—		—		—
Total group annuity actuarial reserves, net of reinsurance	$	52,335	$	—	$	1,454	$	53,789

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

	2019
			Separate		Separate
			Account		Account
	General		with		Non-
	Account		Guarantees		guaranteed		Total		% of total
	(in thousands)
Deposit-Type Contracts (no life contingencies)
Subject to discretionary withdrawal:
- with market value adjustment	$	—	$	—	$	—	$	—	—	%
- at book value less surrender charge of 5% or more		—		—		—		—	—	%
- at market value		—		—		1,149		1,149	—	%
Subtotal		—		—		1,149		1,149	—	%

Subject to discretionary withdrawal - without adjustment:
- at book value (minimal or no charge or adjustment)		433,302		—		—		433,302	98	%
Not subject to discretionary withdrawal		8,478		—		—		8,478	2	%
Total deposit fund liabilities		441,780		—		1,149		442,929	100	%
Less: Reinsurance ceded		—		—		—		—
Total deposit fund liabilities, net of reinsurance	$	441,780	$	—	$	1,149	$	442,929

							2018
							(in thousands)		% of total
Annuities and deposit fund liabilities
Subject to discretionary withdrawal - with adjustment:
- with market value adjustment							$	23,828	2	%
- at book value less surrender charge of 5% or more								14	—	%
- at market value								295,527	28	%
Subtotal								319,369	30	%

Subject to discretionary withdrawal - without adjustment:
- at book value (minimal or no charge or adjustment)								615,585	57	%
Not subject to discretionary withdrawal								137,334	13	%
Total annuity actuarial reserves and deposit fund liabilities								1,072,288	100	%
Less: Reinsurance ceded								9,547
Total annuity actuarial reserves and deposit fund liabilities, net of reinsurance							$	1,062,741

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Withdrawal characteristics of life actuarial reserves as of December 31, 2019 are as follows:

	General Account						Separate Account - Non-guaranteed
			General
	Account		Account				Account		Cash
	Value		Cash Value		Reserve		Value		Value		Reserve
						(in thousands)
Subject to discretionary withdrawal, surrender values or policy loans:
- Term policies with cash value	$	1,058	$	1,058	$	7,814	$	—	$	—	$	—
- Universal life		664,324		653,032		756,376		—		—		—
- Universal life with secondary guarantees		21,967		19,979		69,448		—		—		—
- Indexed universal life		17		15		15		—		—		—
- Indexed universal life with secondary guarantees		—		—		—		—		—		—
- Indexed life		—		—		—		—		—		—
- Other permanent cash value life insurance		7,562,874		7,562,874		7,933,315		—		—		—
- Variable life		—		—		—		—		—		—
- Variable universal life		87,943		84,935		88,411		733,948		708,844		734,130
- Miscellaneous reserves		—		—		—		—		—		—

Not subject to discretionary withdrawal, with no cash value:
- Term policies without cash value		XXX		XXX		62,240		XXX		XXX		—
- Accidental death benefits		XXX		XXX		523		XXX		XXX		—
- Disability-active lives		XXX		XXX		4,993		XXX		XXX		—
- Disability-disabled lives		XXX		XXX		22,835		XXX		XXX		—
- Miscellaneous reserves		XXX		XXX		4,527		XXX		XXX		—

Total (gross: direct + assumed)		8,338,183		8,321,893		8,950,497		733,948		708,844		734,130
Less: Reinsurance ceded		—		—		297,263		—		—		—
Total, net	$	8,338,183	$	8,321,893	$	8,653,234	$	733,948	$	708,844	$	734,130

Reinsurance with unauthorized companies

NNY has ceded insurance liabilities to insurers not licensed in the State of New York. To the extent such liabilities are not collateralized, New York insurance regulators require the establishment of a liability through a charge to surplus equal to the ceded liabilities placed with such companies. These liabilities were $5.7 million and $0.6 million as of December 31, 2019 and 2018, respectively, and are included in accrued expenses and general liabilities.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Reinsurance agreements with affiliates

An affiliate, PHL Variable Insurance Company (“PHL”) has a treaty in force with the Company, whereby NNY has assumed, on a 90% coinsurance basis, all Phoenix Accumulator Universal Life III and IV sold by PHL from January 1 to December 31, 2008. The reserves ceded to NNY for these policies were $74.6 million and $76.5 million at December 31, 2019 and 2018, respectively.

Effective June 30, 2015, the Company entered into a MODCO reinsurance agreement with PHL. This agreement provides that the Company will retrocede, and PHL will reinsure, 80% of the inforce group executive ordinary (“GEO”) corporate-owned whole life insurance policies assumed by the Company from a third-party. Under MODCO, the assets, which are equal to the statutory reserves held for the reinsured policies, and liabilities associated with the assumed business are retained by the Company. The MODCO reserves under this treaty were $1.1 billion as of December 31, 2019.

Direct business written and reinsurance assumed and ceded

As is customary practice in the insurance industry, NNY assumes and cedes reinsurance as a means of diversifying underwriting risk.

NNY’s reinsurance program varies based on the type of risk, for example:

●	For business sold prior to December 31, 2010, the Company’s retention limit on any one life is $10 million for single life and joint first-to-die policies and $12 million for joint last-to-die policies. Beginning January 1, 2011, the Company’s retention limit on new business is $5 million for single life and joint first-to-die policies and $6 million for second-to-die policies.

●	NNY cedes up to 80% on policies in its term life insurance.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Additional information on direct business written and reinsurance assumed and ceded for the years ended December 31 is set forth below:

	2019			2018
	(in thousands)
Direct premiums and annuity considerations	$	359,486		$	367,246
Reinsurance assumed - non-affiliate		8,774			8,848
Reinsurance assumed - affiliate		21,353			23,037
Reinsurance ceded - non-affiliate		(133,551	)		(140,863	)
Reinsurance ceded - affiliate		(6,205	)		(6,292	)
Net premiums and annuity considerations	$	249,857		$	251,976

Direct commission s and expense allowance	$	3,192		$	3,840
Reinsurance assumed - non-affiliate		244			324
Reinsurance assumed - affiliate		1,585			1,634
Reinsurance ceded - non-affiliate		(5,337	)		(5,791	)
Reinsurance ceded - affiliate		(7,903	)		(7,400	)
Net commissions and expense allowance	$	(8,219	)	$	(7,393	)

Direct policy and contract claims incurred	$	661,521		$	655,434
Reinsurance assumed - non-affiliate		36,408			81,154
Reinsurance assumed - affiliate		28,960			14,551
Reinsurance ceded - non affiliate		(219,084	)		(232,163	)
Reinsurance ceded - affiliate		(26,286	)		(59,329	)
Net policy and contract claims incurred	$	481,519		$	459,647

Direct policy and contract claims payable	$	124,606		$	122,898
Reinsurance assumed - non-affiliate		20,522			47,152
Reinsurance assumed - affiliate		607			163
Reinsurance ceded - non-affiliate		(14,590	)		(33,387	)
Net policy and contract claims payable	$	131,145		$	136,826

Direct life insurance in force	$	26,530,737		$	28,458,804
Reinsurance assumed		2,955,890			2,927,687
Reinsurance ceded		(10,311,574	)		(13,360,421	)
Net insurance in force	$	19,175,053		$	18,026,070

In the event all reinsurance agreements were to be terminated, the Company estimates the aggregate reduction in surplus would be $16.3 million and $17.0 million for the years ended December 31, 2019 and 2018, respectively.

Change in incurred losses and loss adjustment expenses

Reserves on Group Accident and Health policies were $19.1 million as of December 31, 2018. As of December 31, 2019, $2.0 million has been paid for incurred losses attributable to insured events of prior years. Reserves remaining for prior years are now $18.0 million as a result of unpaid claims principally on the Group Accident and Health line of business. Therefore, there has been $0.9 million of unfavorable prior year development since December 31, 2018. Increases or (decreases) are generally the result of ongoing analysis of recent loss development trends. Original estimates are increased or decreased as additional information becomes known regarding individual claims.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

7. Leases and Rentals

Rental expense for operating leases, principally with respect to office equipment and office space, amounted to $1.0 million and $1.3 million in 2019 and 2018, respectively. Future minimum rental payments under non-cancelable operating leases were approximately $2.6 million as of December 31, 2019, payable as follows: 2020 - $0.5 million; 2021 - $0.5 million; 2022 - $0.6 million; 2023 - $0.6 million and 2024 - $0.4 million.

8. Electronic Data Processing Equipment

Electronic data processing (“EDP”) equipment and software, gross, as of December 31, 2019 and 2018 was $34.5 million and $76.9 million, respectively. EDP accumulated depreciation as of December 31, 2019 and 2018 was $30.2 million and $69.6 million, respectively. Depreciation for the year ended December 31, 2019 and 2018 was $3.0 million and $3.7 million, respectively. EDP equipment and software are depreciated over 3 to 7 years, using the straight-line and method. Non-admitted EDP equipment totaled $4.3 million and $7.3 million as of December 31, 2019 and 2018, respectively.

9. Furniture and Fixtures

Furniture and equipment cost as of December 31, 2019 and 2018 was $5.0 million and $6.5 million, respectively. Accumulated depreciation as of December 31, 2019 and 2018 was $4.6 million and $5.9 million, respectively. Depreciation for the years ended December 31, 2019 and 2018 was $0.2 million and $0.2 million, respectively. Non-admitted furniture and equipment totaled $0.4 million and $0.6 million as of December 31, 2019 and 2018, respectively.

Depreciation or amortization periods are generally 7 to 39 years for furniture and equipment, leasehold improvements, and building improvements. Depreciation or amortization is generally calculated using the straight-line method.

10. Premium and Annuity Considerations Deferred and Uncollected

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2019 were as follows:

Type of Business	Gross		Net of Loading
	(in thousands)
Ordinary renewal	$	63,706	$	63,401
Total	$	63,706	$	63,401

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2018 were as follows:

Type of Business	Gross		Net of Loading
	(in thousands)
Ordinary renewal	$	68,799	$	68,807
Total	$	68,799	$	68,807

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

11. Separate Accounts

The Company utilizes separate accounts to record and account for assets and liabilities for particular lines of business and/ or transactions. For the current reporting year, the Company reported assets and liabilities from the following product lines/ transactions into a separate account: variable annuity, variable payout annuity, variable universal life and supplemental contracts. All separate account products are authorized under New York Insurance Law, §4240.

In accordance with the products/transactions recorded within the separate account, the legal insulation of the separate account assets prevents such assets from being generally available to satisfy claims resulting from the general account. As of December 31, 2019 and 2018, the Company’s separate account statement included legally insulated assets of $1,060.4 million and $942.3 million, respectively.

In accordance with the products/transactions recorded within the separate account, some separate account liabilities are guaranteed by the general account. In accordance with the guarantees provided, if the investment proceeds are insufficient to cover the rate of return guaranteed for the product, the policyholder proceeds will be remitted by the general account.

As of December 31, 2019, the general account of the Company had a maximum guarantee for separate account liabilities of $1.1 million. To compensate the general account for the risk taken, the separate account paid risk charges of $0.2 million and $0.6 million for the years ended December 31, 2019 and 2018, respectively. The general account paid $0.2 million and $0.6 million relating to separate account guarantees for the years ended December 31, 2019 and 2018, respectively.

The Company does not engage in securities lending transactions within the separate accounts.

Reserves for separate account liabilities were $1,060.0 million and $941.5 million as of December 31, 2019 and 2018, respectively. Separate account premiums and other considerations received were $28.7 million and $35.8 million for the years ended December 31, 2019 and 2018, respectively, and were reported as revenue in the Statements of Income and Changes in Capital and Surplus. Withdrawals at market value were $81.7 million and $68.4 million for the years ended December 31, 2019 and 2018, respectively, and were reported as benefits in the Statements of Income and Changes in Capital and Surplus.

The net transfers to and from the separate accounts, included in the change in reserves for future policy benefits and policyholders’ funds in the Statements of Income and Changes in Capital and Surplus were as follows:

	2019			2018
	(in thousands)
Transfers to separate accounts	$	28,702		$	35,799
Transfers from separate accounts		(104,374	)		(95,775	)
Other		(133	)		—
Net transfers from separate account		(75,805	)		(59,976	)

Transfers as reported in the Statements of Income and Changes in Capital and Surplus	$	(75,805	)	$	(59,976	)

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

12. Federal Income Taxes

The components of the net deferred tax asset/(liability) at period end and the change in those components are as follows:

	December 31, 2019						December 31, 2018						Change
	Ordinary		Capital		Total		Ordinary		Capital		Total		Ordinary			Capital			Total
	(in thousands)
Gross deferred tax assets	$	164,868	$	6,235	$	171,103	$	138,182	$	6,800	$	144,982	$	26,686		$	(565	)	$	26,121
Statutory valuation allowance		—		—		—		—		—		—		—			—			—
Adjusted gross deferred tax assets		164,868		6,235		171,103		138,182		6,800		144,982		26,686			(565	)		26,121
Less: Deferred tax assets non-admitted		42,390		—		42,390		23,269		6,800		30,069		19,121			(6,800	)		12,321
Subtotal net admitted deferred tax assets		122,478		6,235		128,713		114,913		—		114,913		7,565			6,235			13,800
Less: Deferred tax liabilities		72,023		319		72,342		57,576		—		57,576		14,447			319			14,766
Net deferred tax assets	$	50,455	$	5,916	$	56,371	$	57,337	$	—	$	57,337	$	(6,882	)	$	5,916		$	(966	)

	December 31, 2019						December 31, 2018						Change
	Ordinary		Capital		Total		Ordinary		Capital		Total		Ordinary			Capital			Total
	(in thousands)
Federal income taxes paid in prior years
recoverable through loss carrybacks	$	—	$	—	$	—	$	—	$	—	$	—	$	—		$	—		$	—
Adjusted gross deferred tax assets
expected to be realized after application
of the threshold limitation		50,455		5,916		56,371		57,337		—		57,337		(6,882	)		5,916			(966	)
1) Adjusted gross deferred tax assets
expected to be realized following the
balance sheet date		50,455		5,916		56,371		57,337		—		57,337		(6,882	)		5,916			(966	)
2) Adjusted gross deferred tax assets
allowed per limitation threshold		XXX		XXX		58,789		XXX		XXX		68,636		XXX			XXX			(9,847	)
Adjusted gross deferred tax assets offset
by gross deferred tax liabilities		72,023		319		72,342		57,576		—		57,576		14,447			319			14,766
Deferred tax assets admitted as the
result of application of SSAP 101	$	122,478	$	6,235	$	128,713	$	114,913	$	—	$	114,913	$	7,565		$	6,235		$	13,800

	2019			2018
	($ in thousands)
Ratio percentage used to determine recovery period and threshold limitation amount		930	%		821	%
Amount of adjusted capital and surplus used to determine recovery period
and threshold limitation	$	391,929		$	672,811

	December 31, 2019						December 31, 2018						Change
	Ordinary			Capital			Ordinary			Capital			Ordinary			Capital
	($ in thousands)
Impact of tax planning strategies
Adjusted gross DTAs	$	164,868		$	6,235		$	138,182		$	6,800		$	26,686		$	(565	)
% of total adjusted gross DTAs		—	%		—	%		—	%		—	%		—	%		—	%
Net admitted adjusted gross DTAs	$	122,478		$	6,235		$	114,913		$	—		$	7,565		$	6,235
% of total net admitted adjusted
gross DTAs		—	%		—	%		—	%		—	%		—	%		—	%

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Management believes that it is more likely than not that the Company will be able to utilize the DTA in the future without any tax planning strategies.

The Company believes that there is sufficient positive evidence, including a history of earnings and projected future income generation, to support that it is more likely than not that NNY will realize the tax benefits associated with its deferred tax assets and consequently, it is not required to record a valuation allowance for statutory accounting purposes.

Regarding deferred tax liabilities that are not recognized, the Company has no temporary differences for which deferred tax liabilities have not been established.

The components of current income taxes incurred in the Statements of Income and Changes in Capital and Surplus and the net deferred tax asset/(liability) recognized in the Company’s Statutory Statements of Admitted Assets and Statutory Statements of Liabilities, Capital and Surplus at December 31, 2019 and 2018 were as follows:

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

	2019			2018			Change
	(in thousands)
Current income tax:
Federal	$	11,308		$	(1,473	)	$	12,781
Foreign		—			—			—
Subtotal		11,308			(1,473	)		12,781
Federal income tax on net capital gains		(1,139	)		1,562			(2,701	)
Utilization of capital loss carryforwards		—			—			—
Other		—			—			—
Federal and foreign income tax expense (benefit) incurred	$	10,169		$	89		$	10,080

Deferred tax assets:
Ordinary
Future policyholder benefits	$	43,098		$	45,672		$	(2,574	)
Investments		56,169			27,735			28,434
Deferred acquisition costs		28,013			29,010			(997	)
Policyholder dividends accrual		26,283			24,448			1,835
Fixed assets		—			—			—
Compensation and benefits accrual		3,591			3,901			(310	)
Pension accrual		—			—			—
Net operating loss carryforward		—			—			—
Tax credit carryforward		1,136			2,272			(1,136	)
Other (including items <5% of total ordinary tax assets)		6,579			5,144			1,435
Subtotal		164,869			138,182			26,687
Non-admitted		42,390			23,269			19,121
Admitted ordinary deferred tax assets	$	122,479		$	114,913		$	7,566

Capital:
Investments	$	3,701		$	4,782		$	(1,081	)
Net capital loss carryforward					—			—
Other (including items <5% of total capital tax assets)		2,534			2,018			516
Subtotal		6,235			6,800			(565	)
Non-admitted		—			6,800			(6,800	)
Admitted capital deferred tax assets		6,235			—			6,235
Admitted deferred tax assets	$	128,714		$	114,913		$	13,801

Deferred tax liabilities:
Ordinary
Investments	$	42,075		$	25,125		$	16,950
Fixed assets		2,259			1,050			1,209
Policyholder reserves		22,146			25,857			(3,711	)
Other (including items <5% of total ordinary tax liabilities)		5,543			5,544			(1	)
Subtotal		72,023			57,576			14,447

Capital:
Investments		237			—			237
Other (including items <5% of total ordinary tax liabilities)		82			—			82
Subtotal		319			—			319
Deferred tax liabilities		72,342			57,576			14,766
Net admitted deferred tax assets (liabilities)	$	56,372		$	57,337		$	(965	)

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Reconciliation of federal income tax rate to actual effective rate:

	December 31, 2019
							Effective
	Amount			Tax Effect			Tax Rate
	(in thousands)
Income before taxes	$	(4,482	)	$	(941	)	21.0	%
Interest maintenance reserve		105			22		(0.5	%)
Dividends received deduction		(7,250	)		(1,523	)	34.0	%
Return to provision		—			—		—	%
Change in non-admitted assets		(4,293	)		(902	)	20.1	%
Rate change		—			—		—	%
Other, including prior year true-up		(998	)		(210	)	4.7	%
Total statutory income tax	$	(16,918	)	$	(3,553	)	79.3	%

Federal income taxes incurred				$	13,891		(309.9	%)
Tax on capital gains/(losses)					(1,139	)	25.4	%
Prior year overaccrual/(underaccrual)					(2,583	)	57.6	%
Change in net deferred income tax expense/(benefit)					(13,722	)	306.2	%
Total statutory income tax				$	(3,553	)	79.3	%

	December 31, 2018
							Effective
	Amount			Tax Effect			Tax Rate
	(in thousands)
Income before taxes	$	94,322		$	19,808		21.0	%
Interest maintenance reserve		(15,028	)		(3,156	)	(3.3	%)
Dividends received deduction		(2,285	)		(480	)	(0.5	%)
Return to provision		6,449			1,354		1.4	%
Change in non-admitted assets		4,413			927		1.0	%
Rate change		(7,388	)		(1,551	)	(1.6	%)
Other, including prior year true-up		4,539			953		1.0	%
Total statutory income tax	$	85,022		$	17,855		18.9	%

Federal income taxes incurred				$	1,051		1.1	%
Tax on capital gains/(losses)					1,561		1.7	%
Prior year overaccrual/(underaccrual)					(2,524	)	(2.7	%)
Change in net deferred income tax expense/(benefit)					17,766		18.8	%
Total statutory income tax				$	17,854		18.9	%

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Carryforwards, recoverable taxes and IRC 6603 deposits:

	2019		2018
	(in thousands)
The Company had net operating losses of	$	—	$	—
The Company had capital loss carryforwards of		—		—
The Company had alternative minimum tax credit carryforwards of		1,136		2,272

As a result of The Tax Cuts and Jobs Act (the “TCJA”), the alternative minimum tax (“AMT”) is repealed and related credits will be fully refundable by 2021.

The Company has no income tax expense for 2017, 2018 and 2019 that is available for recoupment in the event of future net capital losses.

There was no aggregate amount of deposits reported as admitted assets under Section 6603 of the Internal Revenue Code as of December 31, 2019 or 2018.

The Company is subject to U.S. federal income tax examinations by tax authorities for years 2015 and after. The Company does not anticipate any material assessments or adjustments to the Company’s liability resulting from the tax examinations of prior open year periods.

Uncertain tax positions are assessed under the applicable statutory accounting guidance. Based upon this review, the Company has no potential tax assessments. As of December 31, 2019, the Company has recognized no amount for interest or penalties related to uncertain tax positions. Based upon existing information, the Company does not expect a material change in the recognized liability in the next 12 months. The Company has no tax loss contingencies for which it is reasonably possible that the total liability will significantly increase within twelve months of the reporting date.

The Company is included in the consolidated federal income tax return of The Nassau Companies, NCNY and its subsidiaries. The following companies were included in the consolidated federal income tax return for 2019, effective March 31, 2019:

The Nassau Companies
The Nassau Companies of New York, Inc.
PM Holdings, Inc.
Nassau Life Insurance Company
Phoenix Founders, Inc.

The method of allocation among affiliates of the Company is subject to written agreement approved by the Board of Directors and based upon separate return calculations with current credit for net losses to the extent the losses provide a benefit in the consolidated tax return.

The TCJA provides a base erosion and anti-abuse tax (“BEAT”) which represents minimum tax calculated on a base equal to the taxpayer’s taxable income determined without regard to: (1) the tax benefits arising from base erosion payments, and (2) the applicable base erosion percentage of any NOL allowed for the tax year. The BEAT rate is 5% for the tax years beginning in calendar year 2018, 10% for tax years beginning in 2019 through 2025 and 12.5% percent for tax years beginning after December 21, 2025. The Company is eligible to join as members of an “Aggregate Group” within the meaning of the IRC and the Aggregate Group’s base erosion payments are less than 3% of the Aggregate Group’s total deductions for the years ended December 31, 2019 and 2018. Accordingly, the BEAT liability was $0 for the years ended December 31, 2019 and 2018.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

	2019		2018
	(in thousands)
Gross AMT credit recognized as:
Current year recoverable	$	1,135,752	$	2,271,504
Deferred tax asset		1,135,752		2,271,504
Beginning balance of AMT credit carryforward		2,271,504		4,543,008
Amounts recovered		1,135,752		2,271,504
Adjustments		—		—
Ending balance of AMT credit	$	1,135,752	$	2,271,504

13. Related Party Transactions

NCNY provides services and facilities to the Company that are reimbursed through shared service agreement/cost allocation process. Expenses allocated by NCNY on the Company’s behalf were $93.1 million and $88.1 million for the years ended December 31, 2019 and 2018, respectively. The amounts payable to NCNY were $5.2 million and $6.2 million as of December 31, 2019 and 2018, respectively.

1851 Securities, Inc. (“1851”), a wholly owned subsidiary of NSRE BD Holdco LLC, is the principal underwriter of the Company’s variable life insurance policies and variable annuity contracts. The Company reimburses 1851 for commissions incurred on behalf of PHL and Nassau Life and Annuity Company (“NLA”). Commissions paid by the Company on behalf of PHL were $3.3 million and $3.7 million for the years ended December 31, 2019 and 2018, respectively. There were no amounts receivable from PHL or NLA as of December 31, 2019 and 2018.

The Company pays commissions to producers who sell non-registered life and annuity products on behalf of PHL and NLA. Commissions paid by the Company on behalf of PHL were $44.6 million and $54.0 million for the years ended December 31, 2019 and 2018, respectively. Commissions paid by the Company on behalf of NLA were $28.2 million for the year ended December 31, 2019. The Company had amounts receivable from PHL and NLA of $1.1 million and $3.7 million as of December 31, 2019, respectively. The Company had amounts receivable from PHL and NLA of $3.4 million and $0.2 million as of December 31, 2018, respectively.

The Company’s affiliate, Nassau Asset Management LLC (“NAMCO”) provides investment and related advisory services through an Investment Management Agreement. Expenses incurred under this agreement were $17.2 million and $17.5 million as of December 31, 2019 and 2018, respectively. Amounts receivable from NAMCO were $0.1 million and $0.4 million for the years ended December 31, 2019 and 2018, respectively.

The Company has investments in various classes of notes of Nassau 2017-II Ltd., Nassau 2018-I Ltd., Nassau 2018-II Ltd., Nassau 2019-I Ltd., Nassau 2019-II Ltd. and Nassau 2019-III Ltd. (the “Nassau CLOs”) totaling $87.0 million par with a fair value of $54.7 million and $52.1 million par with a fair value of $48.0 million at December 31, 2019 and 2018, respectively. The Nassau CLOs are managed by NCC CLO Manager, LLC, an affiliate of NNY.

In September 2019, the Company sold certain of its limited partnership and other invested assets to Nassau CFO Fund, LLC (“Nassau CFO”), a collateralized fund obligation managed by an affiliate. The Company received cash and certain equity interests in Nassau CFO as consideration with no gain or loss recognized on the sale. The Company invested in Class B Notes issued by Nassau CFO which have a par and fair value of $14.9 million at December 31, 2019 and recognized $0.4 million of net investment income for the year ended December 31, 2019. The Company’s equity investment in Nassau CFO was $97.4 million at December 31, 2019 and the Company recorded net investment income from Nassau CFO of $17.0 million for the year ended December 31, 2019.

Saybrus Partners, LLC (“Saybrus”), an affiliate of Nassau, provides wholesaling services to various third party distributors and affiliates of variable life insurance and variable annuities.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

PHL provides premium processing services for the Company, wherein PHL receives payments on the Company’s annuity contracts and forwards those payments to the Company. In connection with these services, the Company had amounts receivable from PHL of $5.2 million and $16.2 million as of December 31, 2019 and 2018, respectively. PHL did not charge any fees for this service.

The Company, through PHL, provides premium processing services for NLA, wherein the Company receives premium payments on NLA life and annuity contracts and then forwards them to NLA. In connection with this service, the Company had amounts due to NLA of $0 and $0.1 million as of December 31, 2019 and 2018, respectively. The Company did not charge for these services.

See Note 6 for additional information on reinsurance agreements with affiliates.

The Company has written intercompany agreements in place with its affiliates that contain a settlement date for amounts owed. As of December 31, 2019, no amounts were overdue.

14. Fair Value Disclosures of Financial Instruments

The fair value of an asset is the amount at which that asset could be bought or sold in a current arms-length transaction. Included in several investment related line items in the financial statements are certain financial instruments carried at fair value. Other financial instruments are periodically measured at fair value, such as when impaired, or, for certain bonds and preferred stock when carried at the lower of cost or market. The fair values presented for certain financial instruments are estimates which, in many cases, may differ significantly from the amounts which could be realized upon immediate liquidation. In cases where market prices are not available, estimates of fair value are based on discounted cash flow analyses, which utilize current interest rates for similar financial instruments, which have comparable terms and credit quality.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

Bonds and preferred stock

We use pricing vendors to estimate fair value for the majority of our public bonds and preferred stocks. The pricing vendors’ estimates are based on market data and use pricing models that vary by asset class and incorporate available trade, bid and other market information. When our pricing vendors are unable to obtain evaluations based on market data, fair value is determined by obtaining a direct broker quote or by using an internal model. For the majority of private bonds and preferred stock, fair value is determined using a discounted cash flow model, which utilizes a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions. When the discounted cash flow model is not appropriate, the Company uses third party broker quotes or other internally developed values.

Common stock

Fair values are based on quoted market prices, where available. If a quoted market price is not available, fair values are estimated using independent pricing sources or internally developed pricing models.

Surplus debentures

Fair values are based on quoted market prices, where available, or quoted market prices of comparable instruments. If a quoted market price is not available, fair values are estimated using independent pricing sources or internally developed pricing models.

Investment contracts

The fair value of guaranteed interest contracts was assumed to be the same as book value.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The fair value of deferred annuities and supplementary contracts without life contingencies with an interest guarantee of one year or less is valued at the amount of the policy reserve. In determining the fair value of deferred annuities and supplementary contracts without life contingencies with interest guarantees greater than one year, a discount rate equal to the appropriate Treasury rate, plus 100 basis points, was used to determine the present value of the projected account value of the policy at the end of the current guarantee period.

Deposit-type funds, including pension deposit administration contracts, dividend accumulations, and other funds left on deposit not involving life contingencies, have interest guarantees of less than one year for which interest credited is closely tied to rates earned on owned assets. For such liabilities, fair value is assumed to be equal to the stated liability balances.

Derivatives

Fair values for over-the-counter (“OTC”) derivative financial instruments, principally forwards, options and swaps, represent the present value of amounts estimated to be received from or paid to a marketplace participant in settlement of these instruments (i.e., the amount we would expect to receive in a derivative asset assignment or would expect to pay to have a derivative liability assumed). These derivatives are valued using pricing models based on the net present value of estimated future cash flows and directly observed prices from exchange-traded derivatives or other OTC trades, while taking into account the counterparty’s credit ratings, or our own credit ratings, as appropriate. Determining the fair value for OTC derivative contracts can require a significant level of estimation and management judgment.

New and/or complex instruments may have immature or limited markets. As a result, the pricing models used for valuation often incorporate significant estimates and assumptions that market participants would use in pricing the instrument, which may impact the results of operations reported in the financial statements. For long-dated and illiquid contracts, extrapolation methods are applied to observed market data in order to estimate inputs and assumptions that are not directly observable. This enables us to mark to market all positions consistently when only a subset of prices are directly observable. Values for OTC derivatives are verified using observed information about the costs of hedging the risk and other trades in the market. As the markets for these products develop, the Company will continually refine its pricing models to correlate more closely to the market risk of these instruments.

Financial assets and liabilities measured at fair value

The Company’s financial assets and liabilities carried at fair value have been classified, for disclosure purposes, based on a hierarchy defined by ASC 820, Fair Value Measurements. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset’s or a liability’s classification is based on the lowest level input that is significant to its measurement. For example, a Level 3 fair value measurement may include inputs that are both observable (Levels 1 and 2) and unobservable (Level 3). The levels of the fair value hierarchy are as follows:

●	Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 1 securities include highly liquid government bonds and exchange-traded equities.

●	Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Examples of such instruments include government-backed mortgage products, certain collateralized mortgage and debt obligations and certain high-yield debt securities.

●	Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs reflect management’s own assumptions about inputs in which market participants would use in pricing these types of assets or liabilities. Level 3 financial instruments include values which are determined using pricing models and third-party evaluation.Additionally, the determination of some fair value estimates utilizes significant management judgments or best estimates.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The following table provides information as of December 31, 2019 about the Company’s financial assets and liabilities measured at fair value on a recurring basis.

	2019
	Level 1		Level 2		Level 3		Total
	(in thousands)
Assets at fair value:
Bonds	$	—	$	18,925	$	4,611	$	23,536
Preferred stock		—		—		9,370		9,370
Common stock [1]		96		2,297		54,825		57,218
Subtotal		96		21,222		68,806		90,124

Derivative assets.		—		6,843		—		6,843
Separate account assets		1,053,184		7,184		—		1,060,368
Total assets at fair value	$	1,053,280	$	35,249	$	68,806	$	1,157,335

____________________

[1]	Includes $2,297 thousand Class A Membership FHLB common stock.

The following table provides information as of December 31, 2018 about the Company’s financial assets and liabilities measured at fair value on a recurring basis.

	2018
	Level 1		Level 2		Level 3		Total
	(in thousands)
Assets at fair value:
Bonds	$	—	$	5,220	$	3,945	$	9,165
Preferred stock		—		—		11,893		11,893
Common stock		978		3,412		54,259		58,649
Subtotal.		978		8,632		70,097		79,707

Separate account assets		935,480		6,828		—		942,308
Total assets at fair value	$	936,458	$	15,460	$	70,097	$	1,022,015

Fair values and changes in the fair values of separate account assets generally accrue directly to the policyholders and are not included in the Company’s revenues and expenses or surplus.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Changes in Level 3 Assets and Liabilities Measured at Fair Value

The following table summarizes the changes in assets and liabilities classified in Level 3. Gains and losses reported in this table may include changes in fair value that are attributable to both observable and unobservable inputs.

	2019			2018
	(in thousands)
Level 3 Assets:
Balance, beginning of period	$	70,097		$	58,688
Purchases		12,905			4,957
Sales		(3,977	)		(4,970	)
Settlements		—			(107	)
Transfers into Level 3		5,862			19,960
Transfers out of Level 3		(16,957	)		(9,728	)
Realized gains (losses)		(3,561	)		(1,661	)
Unrealized gains (losses)		4,437			2,958
Balance, end of period	$	68,806		$	70,097

Transfers in and out of Level 3 occur at the beginning of each period. The securities which were transferred into Level 3 for the years ended December 31, 2019 and 2018 were due to decreased market observability of similar assets and/or changes to NAIC ratings. Transfers out of Level 3 for the year ended December 31, 2019 were due to the increased market observability of similar assets and/or securities previously being held at fair value now being carried at amortized cost. Transfers out of Level 3 for the year ended December 31, 2018 were due to the implementation of due diligence procedures which allowed for a refinement of the analysis of observable inputs as described in more detail above. There were no transfers from Level 2 to Level 1 recorded during the years ended December 31, 2019 and 2018.

For Level 3, inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs reflect management’s best estimate of what hypothetical market participants would use to determine fair value. Examples of valuation techniques used based on unobservable inputs include, but are not limited to, internal models, direct broker quotes and professional judgment.

Below is a listing of the aggregate fair value for all financial instruments as of December 31, 2019 and the level within the fair value hierarchy:

											Not
											Practicable
	Aggregate		Admitted								(Carrying
	Fair Value		Assets		Level 1		Level 2		Level 3		Value)
	(in thousands)
Financial Instruments:
Bonds	$	7,518,735	$	7,015,955	$	—	$	5,088,218	$	2,430,517	$	—
Preferred stock		104,983		95,933		—		65,203		39,780		—
Common stock		57,218		57,218		96		2,297		54,825		—
Mortgage loans		406,978		400,498		—		—		406,978		—
Surplus debentures & capcos		15,000		13,062		—		3,872		11,128		—
Cash, cash equivalents & short terms		100,651		100,651		100,651		—		—		—
Derivatives		6,843		—		—		6,843		—		—
Separate account assets		1,060,368		1,060,368		1,053,184		7,184		—		—
Total financial instruments	$	9,270,776	$	8,743,685	$	1,153,931	$	5,173,617	$	2,943,228	$	—

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

As of December 31, 2019, the Company had no investments where it is not practicable to estimate fair value.

Below is a listing of the aggregate fair value for all financial instruments as of December 31, 2018 and the level within the fair value hierarchy:

											Not
											Practicable
	Aggregate		Admitted								(Carrying
	Fair Value		Assets		Level 1		Level 2		Level 3		Value)
	(in thousands)
Financial Instruments:
Bonds	$	7,174,708	$	7,212,940	$	—	$	4,730,477	$	2,444,231	$	—
Preferred stock		127,881		125,947		—		76,592		51,289		—
Common stock		58,649		58,649		978		3,412		54,259		—
Mortgage loans		266,221		268,735		—		—		266,221		—
Surplus debentures & capcos		14,350		13,244		—		3,406		10,944		—
Cash, cash equivalents & short terms		56,891		56,891		56,645		130		116		—
Derivatives		1,951		—		1,951		—		—		—
Separate account assets		942,308		942,308		935,480		6,828		—		—
Total financial instruments	$	8,642,959	$	8,678,714	$	995,054	$	4,820,845	$	2,827,060	$	—

As of December 31, 2018, the Company had no investments where it is not practicable to estimate fair value.

For the years ended December 31, 2019 and 2018, Level 3 bonds were primarily private placement debt securities priced using our internal discounted cash flow model. Market spreads used in the model were unobservable. Nearly all of these securities were in the Industrial and Miscellaneous category.

15. Surplus Notes

NNY’s 7.15% surplus notes are due December 15, 2034 and were originally issued with a face value of $175.0 million. During September 2012, the Company retired $48.3 million face value of these surplus notes, after receiving prior approval from the Department. Interest payments also require the prior approval of the Department and may be made only out of surplus funds that the Department determines to be available for such payments under New York insurance law. The 7.15% surplus notes were issued December 15, 2004 and interest on the notes is scheduled to be paid on June 15 and December 15 of each year, commencing June 15, 2005. Interest payments for these notes for 2019 and 2018 each totaled $9.1 million. The 7.15% surplus notes may be redeemed at the option of NNY at any time at the “make-whole” redemption price set forth in the offering circular. New York insurance law provides that the notes are not part of the legal liabilities of NNY. The 7.15% notes were issued pursuant to Rule 144A under the Securities Act of 1933. No affiliate holds any portion of the notes.

Below are the details on the outstanding surplus notes (amounts in millions):

Interest

Total

Unapproved

Par Value

Carrying

and/or

Interest

Date

Interest

(Face Value

Value

Principal Paid

and/or

Date of

Issued

Rate

of Notes)

of Notes

Current Year

Principal Paid

Principal

Maturity

(in millions)

12/15/2004

7.15%

126.7

126.3

9.1

192.8

—

12/15/2034

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

16. Commitments and Contingencies

Litigation and regulatory matters

The Company is regularly involved in litigation and arbitration, both as a defendant and as a plaintiff. The litigation and arbitration naming the Company as a defendant ordinarily involves the Company’s businesses and operations. In certain of these matters, the plaintiffs are seeking large and/or indeterminate amounts, including punitive or exemplary damages.

The Company periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations related to the Company’s products and practices. It is the Company’s practice to cooperate fully in these matters.

It is not feasible to predict or determine the ultimate outcome of all litigation, arbitration or regulatory proceedings or to provide reasonable ranges of potential losses. It is believed that the outcome of the Company’s litigation, arbitration, and regulatory matters are not likely, either individually or in the aggregate, to have a material adverse effect on the financial condition of the Company beyond the amounts already reported in these financial statements. However, given the large or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, arbitration and regulatory investigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material adverse effect on the results of operations or cash flows in particular annual periods.

17. Other Commitments

The Company has a technology services agreement related to the management of our IT infrastructure which expires in 2019. As of December 31, 2019, the remaining commitments total $5.5 million.

The Company has an outstanding commitment to purchase $50.0 million in investment grade rated infrastructure bonds through an outside investment advisor. The commitment currently expires on January 5, 2021. The arrangement may be terminated prior to funding the committed amount at the discretion of the Company subject to certain standard provisions for notice and immaterial fees. As of December 31, 2019, $42.0 million has been funded.

As part of its normal investment activities, the Company enters into agreements to fund limited partnerships that make debt and equity investments. As of December 31, 2019, the Company had unfunded commitments of $80.2 million.

In addition, the Company enters into agreements to purchase private placement investments. At December 31, 2019, the Company had open commitments of $39.6 million.

18. Information about Financial Instruments with Off-Balance Sheet Risk

The Company, at December 31, 2019 and 2018, held the following financial instruments with off-balance sheet risk:

	Assets*				Liabilities*
	2019		2018		2019		2018
	(in thousands)
Swaps	$	75,000	$	75,000	$	—	$	—
Total	$	75,000	$	75,000	$	—	$	—

____________________

* Notional amount

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The Company uses derivative instruments including interest rate swaps. A more detailed description of these instruments is provided in Footnote 2 - “Summary of Significant Accounting Policies.”

The Company is not exposed to credit-related losses in the event of nonperformance by counterparties to financial instruments, as the interest rate swaps are fully collateralized. The credit exposure of interest rate swaps is represented by the fair value (market value) of contracts with a positive fair value (market value) at the reporting date.

Because exchange-traded interest rate swaps are affected through a regulated exchange and positions are marked to market on a daily basis, the Company has no exposure to credit-related losses in the event of nonperformance by counterparties to such financial instruments.

The Company is required to put up collateral for any interest rate swap contracts that are entered. The amount of collateral that is required is determined by the exchange on which it is traded. The Company currently puts up cash to satisfy this collateral requirement. As of December 31, 2019, the Company held $(4.8) million of collateral.

The current credit exposure of the Company’s derivative contracts is limited to the fair value at the reporting date. Credit risk is managed by entering into transactions with creditworthy counterparties and obtaining collateral as required. The Company also attempts to minimize its exposure to credit risk through the use of various credit monitoring techniques. Approximately 100% of the net credit exposure to the Company from derivative contracts is with investment-grade counterparties.

19. Appropriated Surplus

Surplus includes amounts available for contingencies, some of which are required by state regulatory authorities. The contingency amounts as of December 31, 2019 and 2018 were $2.5 million.

20. Subsequent Events

The Company evaluated events subsequent to December 31, 2019 and through April 24, 2020, the date of issuance of these financial statements. Subsequent events requiring additional disclosure are as follows:

The Company is continuously monitoring the market and economic turbulence arising from COVID-19. It is too early for the Company to assess the impact of the pandemic on policyholder behavior and underwriting risks and the mid-to-long-term impact on the Company’s investments. In light of the uncertainty as to the length or severity of this pandemic, the Company cannot reasonably estimate the full impact of the pandemic on its operations and financial statements at this time, although it could be material.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Supplemental Schedule
Summary of Investments - Other than Investments in Related Parties
December 31, 2019 and 2018

					Amount shown
	Amortized		Fair		in the
December 31, 2019	Cost		Value		balance sheet
	(in thousands)
Fixed maturities:
Bonds:
U.S. government and government agencies and authorities	$	262,584	$	280,053	$	262,584
States, municipalities and political subdivisions		935,812		1,005,254		935,812
Foreign governments		58,433		66,756		58,433
All other corporate bonds [1]		5,743,826		6,153,216		5,759,126
Redeemable preferred stock		997		3,225		997
Total fixed maturities		7,001,652		7,508,504		7,016,952
Equity securities:
Common stock:
Industrial, miscellaneous and all other		57,218		57,218		57,218
Nonredeemable preferred stock		94,936		101,758		94,936
Total equity securities		152,154		158,976		152,154
Mortgage loans		400,498		406,978		400,498
Real estate, at depreciated cost		30,859		XXX		30,859
Contract loans		2,333,929		XXX		2,333,929
Other invested assets [2]		349,537		351,476		344,563
Cash and short-term investments		100,651		100,651		100,651
Receivables for securities		2,620		XXX		2,620
Total cash and invested assets	$	10,371,900			$	10,382,226

____________________

[1]	Amortized cost and fair value amounts exclude $15,300 and $13,455, respectively, of related-party bonds.
[2]	Difference between amortized cost and amount on balance sheet relates to $4,974 of non-admitted other invested assets.

See accompanying independent auditors’ report.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)* Supplemental Schedule Summary of Investments - Other than Investments in Related Parties
December 31, 2019 and 2018	(continued)

					Amount shown
	Amortized		Fair		in the
December 31, 2018	Cost		Value		balance sheet
	(in thousands)
Fixed maturities:
Bonds:
U.S. government and government agencies and authorities	$	260,286	$	267,101	$	260,286
States, municipalities and political subdivisions		991,382		1,008,524		991,382
Foreign governments		77,571		79,522		77,571
All other corporate bonds [1]		5,869,126		5,806,937		5,883,701
Total fixed maturities		7,198,365		7,162,084		7,212,940
Equity securities:
Common stock:
Industrial, miscellaneous and all other		58,649		58,649		58,649
Nonredeemable preferred stock		125,947		127,881		125,947
Total equity securities		184,596		186,530		184,596
Mortgage loans		268,735		266,221		268,735
Real estate, at depreciated cost		30,232		XXX		30,232
Contract loans		2,326,802		XXX		2,326,802
Other invested assets [2]		617,436		618,541		614,915
Cash and short-term investments		56,891		56,891		56,891
Receivables for securities		7,474		XXX		7,474
Total cash and invested assets	$	10,690,531			$	10,702,585

____________________

[1]	Amortized cost and fair value amounts exclude $14,575 and $12,622, respectively, of related-party bonds.
[2]	Difference between amortized cost and amount on balance sheet relates to $2,521 of non-admitted other invested assets.

See accompanying independent auditors’ report.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Supplementary Insurance Information
For the years ended December 31, 2019 and 2018

	As of December 31,				For the years ended December 31,
	Future policy		Other
	benefits,		policy claims		Premium		Net		Benefits,		Other
	losses and		and benefits		and annuity		investment		claims and		operating
	claims		payable		considerations		income		losses		expenses
	(in thousands)
2019:
Insurance Segment	$	9,505,067	$	131,144	$	249,857	$	554,889	$	464,277	$	121,789

2018:
Insurance Segment	$	9,772,208	$	136,826	$	251,976	$	588,147	$	423,210	$	95,242

See accompanying independent auditors’ report.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Supplementary Schedule - Reinsurance
For the years ended December 31, 2019 and 2018

									Percentage
	Gross		Reinsurance		Reinsurance		Net		of assumed
	amount		ceded		assumed		amount		to net
	(in thousands)
Life insurance in force:
2019	$	26,530,737	$	10,311,574	$	2,955,890	$	19,175,053	15%
2018		28,458,804		13,360,421		2,927,687		18,026,070	16%

Life insurance premiums:
2019	$	359,486	$	139,756	$	30,127	$	249,857	12%
2018		367,246		147,155		31,885		251,976	13%

See accompanying independent auditors’ report.

Nassau Life
Insurance Company
(a wholly owned subsidiary of
The Nassau Companies of New York)
Statutory Financial Statements and
Supplemental Schedules
December 31, 2018 and 2017

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Table of Contents

	Page
Statutory Financial Statements:

Independent Auditors’ Report	1-2

Statements of Admitted Assets, Liabilities, Capital and Surplus	3

Statements of Income and Changes in Capital and Surplus	4

Statements of Cash Flows	5

Notes to Statutory Financial Statements	6-41

Supplemental Schedules:

Summary of Investments - Other than Investments in Related Parties	42-43

Supplementary Insurance Information	44

Supplementary Schedule - Reinsurance	45

Independent Auditors’ Report

The Board of Directors
Nassau Life Insurance Company:

We have audited the accompanying financial statements of Nassau Life Insurance Company, which comprise the statutory statements of admitted assets, liabilities, capital and surplus as of December 31, 2018 and 2017, and the related statutory statements of income and changes in capital and surplus, and cash flows for the years then ended, and the related notes to the statutory financial statements.

Management’s Responsibility for the Financial Statements

Auditors’ Responsibility

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles

Adverse Opinion on U.S. Generally Accepted Accounting Principles

In our opinion, because of the significance of the variances between statutory accounting practices and U.S. generally accepted accounting principles discussed in the Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles paragraph, the financial statements referred to above do not present fairly, in accordance with U.S. generally accepted accounting principles, the financial position of Nassau Life Insurance Company as of December 31, 2018 and 2017, or the results of its operations or its cash flows for the years then ended.

Opinion on Statutory Basis of Accounting

In our opinion, the financial statements referred to above present fairly, in all material respects, the admitted assets, liabilities, capital and surplus of Nassau Life Insurance Company as of December 31, 2018 and 2017, and the results of its operations and its cash flows for the years then ended, in accordance with statutory accounting practices prescribed or permitted by the New York State Department of Financial Services described in Note 2.

Other Matter

[(signed) KPMG LLP]

Hartford, Connecticut
April 29, 2019, except for the Supplemental Schedules, as to which the date is July 8, 2020

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Statements of Admitted Assets, Liabilities, Capital and Surplus

	As of
	December 31,
	2018			2017
		(in thousands)
Assets:
Bonds	$	7,212,940		$	7,417,789
Contract loans		2,326,802			2,337,222
Real estate, at depreciated cost		30,232			30,916
Preferred stock		125,947			124,890
Common stock		58,649			49,416
Mortgage loans		268,735			90,939
Cash and short-term investments		56,891			356,007
Other invested assets		614,915			611,112
Receivables for securities		7,474			6,999
Total cash and invested assets		10,702,585			11,025,290
Deferred and uncollected premiums		68,807			72,326
Due and accrued investment income		145,362			147,447
Reinsurance recoverables		7,214			20,659
Deferred tax asset		57,337			58,828
Receivables from affiliates		22,164			17,081
Other assets		13,994			15,315
Separate account assets		942,308			1,121,235
Total assets	$	11,959,771		$	12,478,181

Liabilities:
Reserves for future policy benefits	$	9,191,720		$	9,451,010
Policyholders’ funds		462,047			464,270
Dividends to policyholders		118,441			122,925
Policy benefits in course of settlement		136,826			157,267
Amounts payable on reinsurance.		26,542			14,744
Accrued expenses and general liabilities		62,182			125,464
Current federal and foreign income tax		16,343			51,916
Reinsurance funds withheld liability		232,124			244,968
Interest maintenance reserve (“IMR”)		100,121			115,149
Transfers to separate account due and accrued		(821	)		(1,183	)
Asset valuation reserve (“AVR”)		157,027			161,170
Separate account liabilities		942,308			1,121,235
Total liabilities		11,444,860			12,028,935

Capital and surplus:
Common stock, $1,000 par value (10,000 shares authorized;
10,000 shares issued and outstanding)		10,000			10,000
Paid-in surplus		228,798			228,798
Surplus notes		126,286			126,260
Special surplus funds		2,500			2,500
Unassigned surplus		147,327			81,688
Total surplus		514,911			449,246
Total liabilities, capital and surplus	$	11,959,771		$	12,478,181

The accompanying notes are an integral part of these financial statements.

Nassau Life Insurance Company

(a wholly owned subsidiary of The Nassau Companies of New York)

Statements of Income and Changes in Capital and Surplus

	For the Years Ended
	December 31,
	2018			2017
	(in thousands)
Income:
Premium and annuity considerations	$	251,976		$	296,611
Net investment income		588,147			625,172
Commissions and expense allowances on reinsurance ceded		13,191			13,385
Reserve adjustments on reinsurance ceded		(254,682	)		(247,110	)
Fees associated with separate account and other miscellaneous income		90,894			103,332
Total income		689,526			791,390

Current and future benefits:
Death benefits		442,092			398,007
Disability and health benefits		4,215			3,528
Annuity benefits and matured endowments		13,340			15,247
Surrender benefits		259,836			319,365
Interest on policy or contract funds		13,285			11,929
Settlement option payments		10,032			10,298
Net transfers to (from) separate accounts, net of reinsurance		(59,976	)		(69,360	)
Change in reserves for future policy benefits and policyholders’ funds		(259,614	)		(220,500	)
Total current and future benefits		423,210			468,514

Operating expenses:
Direct commissions		3,840			4,444
Commissions and expense allowances on reinsurance assumed		1,958			3,062
Premium, payroll and miscellaneous taxes		8,744			8,639
Other operating expenses		80,700			151,049
Total operating expenses		95,242			167,194
Net gain (loss) from operations before dividends and federal income taxes		171,074			155,682
Dividends to policyholders		77,321			79,305
Net gain from operations after dividends and before federal income taxes		93,753			76,377
Federal and foreign income tax expense (benefit)		(1,473	)		14,244
Net gain from operations before realized capital gains (losses)		95,226			62,133
Realized capital gains/(losses), net of income taxes and IMR		(992	)		6,253
Net income/(loss)		94,234			68,386

Changes in capital and surplus:
Change in unrealized capital gains (loss), net of tax		24,872			2,752
Change in deferred income taxes		(17,766	)		(92,394	)
Change in non-admitted assets		23,917			110,872
Change in asset valuation reserve		4,143			(8,272	)
Change in surplus notes		26			26
Dividends to stockholder		(60,000	)		(20,000	)
Other surplus changes, net		(3,761	)		(5,292	)
Net increase (decrease) in capital and surplus		65,665			56,078
Capital and surplus, beginning of year		449,246			393,168
Capital and surplus, end of year	$	514,911		$	449,246

The accompanying notes are an integral part of these financial statements.

Nassau Life Insurance Company

(a wholly owned subsidiary of The Nassau Companies of New York)

Statements of Cash Flows

	For the Years Ended
	December 31,
	2018			2017
	(in thousands)
Cash provided by (used for) operations:
Premiums	$	331,153		$	387,217
Investment and other income		578,759			618,109
Claims and benefits		(935,424	)		(926,695	)
Dividends paid		(121,840	)		(132,066	)
Commissions and other expenses		(137,536	)		(157,842	)
Net transfers from separate accounts		60,168			70,522
Federal income taxes recovered (paid)		(35,663	)		(85	)
Net cash provided by (used for) operations		(260,383	)		(140,840	)

Cash provided by (used for) investments:
Proceeds from sales, maturities and repayments of bonds		1,332,418			3,088,320
Proceeds from sales, maturities and repayments of stocks		42,467			43,144
Proceeds from sales, maturities and repayments of other invested assets		100,771			102,611
Proceeds from sales, maturities and repayments of other investments		2,197			492
Cost of bonds acquired		(1,146,988	)		(2,778,370	)
Cost of stocks acquired		(42,257	)		(24,929	)
Cost of mortgage loans acquired		(181,174	)		(91,305	)
Cost of other invested assets acquired		(80,027	)		(85,353	)
Cost of other investments acquired		(1,739	)		(3,027	)
Net decrease (increase) in contract loans		10,420			(5,039	)
Net cash provided by (used for) investments		36,088			246,544

Cash provided by (used for) financing and miscellaneous sources:
Net deposits (withdrawals) of deposit-type contracts		(11,111	)		(17,546	)
Dividends to stockholder		(60,000	)		(20,000	)
Other cash provided (applied)		(3,710	)		53,477
Net cash provided by (used for) financing and miscellaneous uses		(74,821	)		15,931
Net increase (decrease) in cash and short-term investments		(299,116	)		121,635
Cash and short-term investments, beginning of year		356,007			234,372
Cash and short-term investments, end of year	$	56,891		$	356,007

The accompanying notes are an integral part of these financial statements.

Nassau Life Insurance Company

(a wholly owned subsidiary of The Nassau Companies of New York)

Notes to Statutory Financial Statements

1. Description of Business

Effective October 10, 2018, PLIC changed its name to Nassau Life Insurance Company (“NNY” or the “Company”). Effective November 13, 2018, the Company’s Parent, The Phoenix Companies, Inc. (“Phoenix”), changed its name to The Nassau Companies of New York (“NCNY” or the “Parent”). The financial statements of NNY are presented on the basis of accounting practices prescribed or permitted by the New York Department of Financial Services (the “NYDFS”).

On June 20, 2016, Nassau Insurance Group Holdings L.P. (“Nassau” or “Nassau Re”) completed its acquisition of NCNY after receipt of insurance regulatory approvals from the Connecticut Insurance Department and the NYDFS. Founded in April 2015, Nassau Re is a privately held insurance and reinsurance business focused on building a franchise across the insurance value chain.

NNY is a provider of life insurance and annuity products. The Company’s life insurance products include whole life, universal life, variable universal life and other insurance products. NNY offers single-life and multiple-life products. Most of our whole life policies were written prior to the demutualization and are part of the Closed Block. The Company also offers annuity products including both deferred and immediate varieties. Deferred annuities accumulate for a number of years before periodic payments begin and enable the contract owner to save for retirement and provide options that protect against outliving assets during retirement. Immediate annuities are purchased by means of a single lump sum payment and begin paying periodic income within the first year.

2. Summary of Significant Accounting Policies

Basis of presentation

The significant accounting policies, which are used by NNY in the preparation of the statutory financial statements, are described below.

●	The costs related to acquiring business, principally commissions and certain policy issue expenses, are charged to income in the year incurred for STAT and are capitalized as deferred acquisition costs (“DAC”) and then amortized for U.S. GAAP.
●	Statutory concepts such as non-admitted assets, asset valuation reserve and interest maintenance reserve are recognized only for STAT.
●	Bonds are primarily carried at amortized cost for STAT and at fair value for U.S. GAAP.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

●	For certain deposit-type contracts in the accumulation stage and for annuity products, deposits are reported as annuity considerations (a revenue item) for statutory reporting, while U.S. GAAP reports these as deposits via the balance sheet.
●	Reserves for participating life policies are calculated using various methods allowed under statutory accounting.
●	Non-life subsidiaries are recorded based on the underlying audited U.S. GAAP equity of the investee.
●	Under STAT, for individual participating life policies, premiums are recognized when due. For universal life, interest sensitive life, variable universal life policies and variable annuity contracts, premiums or deposits are recognized as revenue and withdrawals are recognized as surrender benefits. Under U.S. GAAP, premiums are recognized for participating life insurance products and other life insurance products as revenue when due from policyholders. Benefits, losses and related expenses are matched with premiums over the related contract periods. Amounts received as payments for universal life, variable universal life and other investment-type contracts are considered deposits and are not included in premiums. Withdrawals taken from these contracts are generally considered returns of policyholder account balances and are not included in surrender benefits for U.S. GAAP.
●	Statutory reserves are based on different assumptions than they are under U.S. GAAP.
●	For STAT, the cost of employee pension benefits, including prior service costs, is recognized as the employer contributions are made to fund the costs. Certain costs of employee post-retirement health benefits are recognized over an employee’s service period. For U.S. GAAP, pension and other post-employment benefit costs and obligations are recognized over the employees’ expected service periods by discounting an estimate of aggregate benefits, adjusted by assumed investment rates of return on benefit plan assets, if applicable.
●	Assets and liabilities are reported net of reinsurance balances for STAT and gross for U.S. GAAP.
●	Surplus notes issued by the Company are recorded as a component of surplus for STAT and as debt for U.S. GAAP.
●	The statutory provision for federal income taxes represents estimated amounts currently payable based on taxable income or loss reported in the current accounting period as well as changes in estimates related to prior year taxes. Deferred income taxes are provided in accordance with Statement of Statutory Accounting Principles (“SSAP”) No. 101, Income Taxes, a Replacement of SSAP No. 10R and SSAP No. 10, and changes in deferred income taxes are recorded through surplus. SSAP 101 adopts the U.S. GAAP valuation allowance standard and also limits the recognition of deferred tax assets (“DTAs”) based on certain admissibility criteria. The U.S. GAAP provision would include a provision for taxes currently payable as well as deferred taxes, both of which would be recorded in the income statement. Under SSAP 101, in conjunction with SSAP 5R as modified to replace the “probable” standard with a “more likely than not” standard, companies must establish a liability related to uncertain tax positions where management determines that it is more likely than not a claimed tax benefit would not be sustained if audited. SSAP 101 specifically rejects the corresponding U.S. GAAP guidance. For U.S. GAAP, the Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes. Income tax expense or benefit is recognized based upon amounts reported in the financial statements and the provisions of currently enacted tax laws. Deferred tax assets and/or liabilities are determined by multiplying the differences between the financial reporting and tax reporting bases for assets and liabilities by the enacted tax rates expected to be in effect when such differences are recovered or settled. Valuation allowances on deferred tax assets are recorded to the extent that management concludes that it is more likely than not that an asset will not be realized. We assess all significant tax positions to determine if a liability for an uncertain tax position is necessary and, if so, the impact on the current or deferred income tax balances.

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results will differ from those estimates. Significant estimates used in determining insurance and contractholder liabilities, income taxes, contingencies and valuation allowances for investment assets are discussed throughout the Notes to Statutory Financial Statements. To be consistent with the current year presentation, certain prior year reclassifications have been made.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Recent accounting pronouncements

The Company did not adopt any accounting standards during 2018 that had a material impact on these financial statements.

Going concern

Management has evaluated the Company’s ability to continue as a going concern and concluded that there is not substantial doubt about the Company’s ability to continue as a going concern.

Parent company liquidity

NCNY serves as the holding company for NNY and does not have any significant operations of its own. As of December 31, 2018 and 2017, liquidity (cash, short-term investments, available-for-sale debt securities and other near-cash assets, net of contributions payable to subsidiaries and certain other holding company obligations) totaled $93.5 million and $110.4 million, respectively. In addition to existing cash and securities, the holding company’s primary source of liquidity consists of dividends from NNY. Dividends from NNY are limited under the insurance company laws of New York.

NCNY committed to its insurance regulator to maintain NNY’s Company Action Level RBC at or above 300% and its surplus to policyholder reserves ratio (excluding separate accounts) at or above 3.5% through 2023. As of December 31, 2018, RBC and surplus to reserve ratios were in excess of these levels.

Dividends to the Company from NNY are limited under the insurance company laws of New York. In addition to the statutory limitations on paying dividends, the Company also considers the level of statutory capital and RBC of the entity and other liquidity requirements.

New York Insurance Law allows a domestic stock life insurer to distribute an ordinary dividend where the aggregate amount of such dividend in any calendar year does not exceed the greater of 10% of its surplus to policyholders as of the immediately preceding calendar year or its net gain from operations for the immediately preceding calendar year, not including realized capital gains, not to exceed 30% of its surplus to policyholders as of the immediately preceding calendar year. The foregoing ordinary dividend can only be paid out of earned surplus, which is defined as an insurer’s positive unassigned funds, excluding 85% of the change in net unrealized gains or losses less capital gains tax for the preceding year. Under this section, an insurer cannot distribute an ordinary dividend in the calendar year immediately following a calendar year for which the insurer’s net gain from operations, not including realized capital gains, was negative. If a company does not have sufficient positive earned surplus to pay an ordinary dividend, an ordinary dividend can still be paid where the aggregate amount is the lesser of 10% of its surplus to policyholders as of the immediately preceding calendar year or its net gain from operations for the immediately preceding calendar year, not including realized capital gains. Based on this calculation, NNY could pay a dividend of $95.2 million in 2019. During the year ended December 31, 2018, NNY declared and paid $60.0 million, in dividends to the Company.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Investments

Investments are recognized in accordance with methods prescribed by the NAIC.

Investments in bonds include public and private placement bonds and mortgage-backed securities. Bonds with an NAIC designation of 1-5 are carried at amortized cost using the scientific method while those with an NAIC designation of 6 are carried at the lower of amortized cost or fair value. Mortgage-backed and structured securities are assigned an NAIC designation in accordance with SSAP No. 43R, Loan-Backed and Structured Securities. Amortized cost for mortgage-backed and structured securities is determined using the scientific method, utilizing anticipated cash flows based upon prepayment assumptions. When actual prepayments differ significantly from anticipated prepayments, the effective yield is recalculated to reflect actual payments to date and any resulting adjustment is included in net investment income. Amortization is adjusted for significant changes in estimated cash flows from the original purchase assumptions.

Redeemable and non-redeemable preferred stock that has a NAIC designation of 1-3 is stated at amortized cost. Those with a designation of 4-6 are carried at the lower of amortized cost or fair value.

Common stock is carried at fair value.

Mortgage loans on real estate are carried at the outstanding principal balance, less any allowances for credit losses.

Contract loans are generally reported at their unpaid balances and are collateralized by the cash values of the related policies.

Investments in affiliates represent direct and indirect ownership in the common stock of subsidiaries.

Home office real estate is generally valued at depreciated cost. Depreciation of real estate is calculated using the straight-line method over the estimated lives of the assets (generally 40 years).

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Derivatives

Interest Rate Swaps

The Company uses interest rate swaps to hedge the interest rate risks or the so-called “rho” greek risk exposure (referring to the sensitivity of the fair value of assets and liabilities to changes in interest rates) associated with certain annuity products. These hedges are conducted pursuant to its approved Derivatives Use Plan (“DUP”).

The Company has no derivative contracts with financing premiums.

The unrealized gain/(loss) during the period representing equity index options was $0 and $3.2 million as of December 31, 2018 and 2017, respectively.

The Company had no net gain or loss recognized in unrealized gains (losses) during the reporting period resulting from derivatives that no longer qualify for hedge accounting.

The Company had derivatives accounted for as cash flow hedges of forecasted transaction.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Net investment income

Net investment income primarily represents interest and dividends received or accrued on bonds, common and preferred stock, short-term investments and real estate. It also includes amortization of any purchase premium or discount using the interest method, adjusted retrospectively for any change in estimated yield-to-maturity. For partnership investments, income is earned when cash distributions of income are received. Investment income due and accrued that is deemed uncollectible is charged against net investment income in the period such determination is made, while investment income greater than 90 days past due is non-admitted and charged directly to surplus. There was $0.3 million and $0.2 million due and accrued investment income non-admitted at December 31, 2018 and 2017, respectively.

Non-admitted assets

In accordance with regulatory requirements, certain assets, including certain receivables, certain investments in limited liability companies, certain deferred tax assets, prepaid expenses and furniture and equipment, are not allowable and must be charged against surplus and are reported in the Statements of Income and Changes in Capital and Surplus. Total non-admitted assets at December 31, 2018 and 2017 were $44.7 million and $68.6 million, respectively. Changes for the years ended December 31, 2018 and 2017 were decreases of $23.9 million and $110.9 million, respectively.

Separate accounts

Insurance liabilities

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Fees associated with separate accounts and other miscellaneous income

Fees consist of contract charges assessed against the fund values and are recognized, when earned.

Premium income and related expenses

Stockholder dividends

During 2018 and 2017, the Company paid cash dividends of $60.0 million and $20.0 million, respectively, to its parent, Nassau.

New York Insurance Law allows a domestic stock life insurer to distribute an ordinary dividend where the aggregate amount of such dividend in any calendar year does not exceed the greater of 10% of its surplus to policyholders as of the immediately preceding calendar year or its net gain from operations for the immediately preceding calendar year, not including realized capital gains, not to exceed 30% of its surplus to policyholders as of the immediately preceding calendar year. The foregoing ordinary dividend can only be paid out of earned surplus, which is defined as an insurer’s positive unassigned funds, excluding 85% of the change in net unrealized gains or losses less capital gains tax for the preceding year. An insurer cannot distribute an ordinary dividend in the calendar year immediately following a calendar year for which the insurer’s net gain from operations, not including realized capital gains, was negative. If a company does not have sufficient positive earned surplus to pay an ordinary dividend out of §4207(a)(2), an ordinary dividend may still be payable under §4207(a)(3) of the New York Insurance Law. Under §4207(a)(3), a dividend can be paid where the aggregate amount is the lesser of 10% of its surplus to policyholders as of the immediately preceding calendar year or its net gain from operations for the immediately preceding calendar year, not including realized capital gains. Based on these calculation, for 2019, the Company can pay dividends of $95.2 million if allowed by the NYDFS.

Reinsurance

Assets and liabilities related to reinsurance ceded contracts are reported on a net basis.

Policyholder dividends

Income taxes

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Employee benefit plans

The Company participates in a qualified, noncontributory defined benefit pension plan and a non-qualified supplemental defined benefit plan sponsored by its parent, NCNY. For purposes of statutory accounting, the Company has no legal obligation for benefits under these plans. The Company’s share of net expenses for these plans was $8.4 million and $38.9 million for 2018 and 2017, respectively. The decrease in 2018 was due to higher pension contributions made in 2017.

Nassau Re employees are covered by a qualified defined contribution plan sponsored by the Company’s parent, NCNY. Effective January 1, 2018, NCNY’s match percentage was changed to dollar for dollar to a maximum of 5% of eligible 401(k) earnings. Previously, contributions made by employees were matched, up to 150% on the first 6% of base compensation. The Company’s contribution for the plan was $0.8 million and $1.3 million for 2018 and 2017, respectively.

The Company historically provided certain other postretirement benefits to retired employees through a plan sponsored by its parent, NCNY. For purposes of statutory accounting, the Company has no legal obligation for benefits under this plan. The Company had a net benefit of $18.6 million and a net expense of $0.3 million for 2018 and 2017, respectively. 2018 included the impact from a curtailment of benefits.

ASO Uninsured portion of partially insured plans

Surplus

The portion of unassigned surplus represented or (reduced) by cumulative unrealized gains (losses) was $97.8 million and $89.8 million as of December 31, 2018 and 2017, respectively.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

Non-cash items

The Statements of Cash Flows exclude non-cash items, such as the following:

●	Non-cash investment transactions, such as tax-free exchanges;

●	Accretion of amortization or accrual of discount for investments;

●	Depreciation expense;

●	Inception Modified coinsurance (“MODCO”) reinsurance adjustments, including inception ceded/assumed premium amounts; and

●	Accruals of capital contributions approved by the domiciliary commissioner.

The Statements of Cash Flows exclude the following significant non-cash items for the years ended December 31, 2018 and 2017:

●	$79.7 million and $24.7 million of non-cash investment exchanges as of December 31, 2018 and 2017, respectively.

3. Significant Transactions

Closed block

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

4. Investments

Information pertaining to NNY’s investments, net investment income and capital gains and losses on investments follows.

Bonds, common stock and preferred stock

The carrying value and fair value of investments in bonds, common and preferred stock as of December 31, 2018 were as follows:

			Gross		Gross
	Carrying		Unrealized		Unrealized			Fair
	Value		Gains		Losses			Value
	(in thousands)
U.S. government	$	208,346	$	8,074	$	(1,131	)	$	215,289
All other governments		77,571		2,693		(742	)		79,522
States, territories and possessions		40,594		2,328		(651	)		42,271
Political subdivisions of states, territories
and possessions		67,174		3,254		(481	)		69,947
Special revenue		495,300		24,727		(4,214	)		515,813
Industrial and miscellaneous (unaffiliated)		4,219,702		107,656		(138,222	)		4,189,136
Parent, subsidiaries and affiliates		14,575		206		(2,159	)		12,622
Hybrid securities		230,896		1,716		(21,254	)		211,358
Mortgage-backed and asset-backed securities		1,858,782		21,106		(41,138	)		1,838,750
Total bonds	$	7,212,940	$	171,760	$	(209,992	)	$	7,174,708

Preferred stock	$	125,947	$	3,283	$	(1,349	)	$	127,881
Common stock	$	58,649	$	—	$	—		$	58,649

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

The carrying value and fair value of investments in bonds, common and preferred stock as of December 31, 2017 were as follows:

			Gross		Gross
	Carrying		Unrealized		Unrealized			Fair
	Value		Gains		Losses			Value
	(in thousands)
U.S. government	$	51,096	$	1,635	$	(195	)	$	52,536
All other governments		85,583		7,863		(15	)		93,431
States, territories and possessions		40,279		4,372		—			44,651
Political subdivisions of states, territories
and possessions		76,767		6,212		(317	)		82,662
Special revenue		405,636		36,097		(781	)		440,952
Industrial and miscellaneous (unaffiliated)		4,808,975		301,016		(25,367	)		5,084,624
Parent, subsidiaries and affiliates		13,331		1,121		(348	)		14,104
Hybrid securities		159,833		2,742		(3,492	)		159,083
Mortgage-backed and asset-backed securities		1,776,289		37,353		(7,093	)		1,806,549
Total bonds	$	7,417,789	$	398,411	$	(37,608	)	$	7,778,592

Preferred stock	$	124,890	$	5,671	$	—		$	130,561
Common stock	$	49,416	$	—	$	—		$	49,416

The gross unrealized capital gains (losses) on bonds and preferred stock were not reflected in surplus for the years ended December 31, 2018 and 2017.

The aging of temporarily impaired general account debt securities as of December 31, 2018 was as follows:

	Less than 12 months					Greater than 12 months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(in thousands)
Debt Securities
U.S. government	$	64,366	$	(870	)	$	6,548	$	(261	)	$	70,914	$	(1,131	)
All other governments		31,770		(729	)		1,987		(13	)		33,757		(742	)
States, territories and possessions		15,852		(650	)		99		(1	)		15,951		(651	)
Political subdivisions		7,842		(278	)		6,174		(203	)		14,016		(481	)
Special revenue		116,932		(2,588	)		27,110		(1,626	)		144,042		(4,214	)
Industrial and miscellaneous (unaffiliated)		2,049,886		(106,405	)		306,222		(31,817	)		2,356,108		(138,222	)
Parent, subsidiaries and affiliates		11,306		(2,159	)		—		—			11,306		(2,159	)
Hybrid securities		118,938		(12,725	)		66,708		(8,529	)		185,646		(21,254	)
Mortgage-backed and asset-backed securities		715,785		(22,243	)		489,872		(18,895	)		1,205,657		(41,138	)
Total bonds	$	3,132,677	$	(148,647	)	$	904,720	$	(61,345	)	$	4,037,397	$	(209,992	)
Number of positions at unrealized loss				943					306					1,249

Preferred stock	$	50,298	$	(1,349	)	$	—	$	—		$	50,298	$	(1,349	)

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

The Company reported $19.6 million and $12.4 million of gross unrealized gains and $2.0 million and $3.2 million of gross unrealized losses related to common stock for the periods ended December 31, 2018 and 2017, respectively, which reflected the difference between cost and fair value for common stock. For the period ended December 31, 2018, the fair value of common stock securities in a continuous unrealized loss position for less than 12 months was $6.4 million with unrealized losses of $0.5 million and the fair value of common stock securities in a continuous unrealized loss position for greater than 12 months was $2.5 million with unrealized losses of $1.5 million.

At December 31, 2018, there are 30 below investment grade debt securities that have been in an unrealized loss position for greater than 12 months. Below investment grade unrealized losses greater than 12 months are $10.7 million. Available-for-sale securities in an unrealized loss position for over 12 months consisted of 306 securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor do we believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, we expect to recover the entire amortized cost basis of these securities. In our evaluation of each security, management considered the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary.

The aging of temporarily impaired general account debt securities as of December 31, 2017 was as follows:

	Less than 12 months					Greater than 12 months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(in thousands)
Debt Securities
U.S. government	$	2,962	$	(41	)	$	4,522	$	(154	)	$	7,484	$	(195	)
All other governments		1,985		(15	)		1,000		—			2,985		(15	)
States, territories and possessions		—		—			—		—			—		—
Political subdivisions		2,465		(14	)		5,944		(303	)		8,409		(317	)
Special revenue		13,148		(49	)		15,927		(732	)		29,075		(781	)
Industrial and miscellaneous (unaffiliated)		239,872		(8,422	)		198,295		(16,945	)		438,167		(25,367	)
Parents, subsidiaries and affiliates		6,288		(348	)		—		—			6,288		(348	)
Hybrid securities		50,561		(830	)		32,138		(2,662	)		82,699		(3,492	)
Mortgage-backed and asset-backed securities		397,801		(2,882	)		205,274		(4,211	)		603,075		(7,093	)
Total bonds	$	715,082	$	(12,601	)	$	463,100	$	(25,007	)	$	1,178,182	$	(37,608	)
Number of positions at unrealized loss				260					143					403

Preferred stock	$	—	$	—		$	—	$	—		$	—	$	—

For the period ended December 31, 2017, the fair value of common stock securities in a continuous unrealized loss position for less than 12 months was $6.4 million with unrealized losses of $0.4 million. The Company had $9.6 million common stock securities in a continuous unrealized loss position for greater than 12 months with unrealized losses of $2.8 million.

For the period ended December 31, 2017, there are 26 below investment grade debt securities that have been in an unrealized loss position for greater than 12 months, and below investment grade unrealized losses greater than 12 months are $8.8 million.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

As of December 31, 2017, available-for-sale securities in an unrealized loss position for over 12 months consisted of 143 securities. Unrealized losses were not recognized in earnings on these debt securities since the Company neither intends to sell the securities nor do we believe that it is more likely than not that it will be required to sell these securities before recovery of their amortized cost basis. Additionally, based on a security-by-security analysis, we expect to recover the entire amortized cost basis of these securities. In our evaluation of each security, management considered the actual recovery periods for these securities in previous periods of broad market declines. For securities with significant declines, individual security level analysis was performed, which considered any credit enhancements, expectations of defaults on underlying collateral and other available market data, including industry analyst reports and forecasts. Although there may be sustained losses for greater than 12 months on these securities, additional information was obtained related to company performance which did not indicate that the additional losses were other-than-temporary.

The carrying value and fair value of bonds as of December 31, 2018 by maturity are shown below.

	Carrying		Fair
	Value		Value
	(in thousands)
Due in one year or less.	$	344,026	$	348,271
Due after one year through five years		1,421,544		1,438,389
Due after five years through ten years		2,602,359		2,559,455
Due after ten years		2,845,011		2,828,593
Total	$	7,212,940	$	7,174,708

The carrying values of securities impaired during the year were $7.4 million and $24.0 million as of December 31, 2018 and 2017, respectively. OTTIs were $11.4 million and $16.2 million in 2018 and 2017, respectively.

Loan-backed securities

As of December 31, 2018, the Company had no OTTI recognized because the present value of cash flows expected to be collected is greater than the amortized cost basis of the securities.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Real estate and mortgage loans

Real estate, which represents the home office used in Nassau’s operations, carried net of accumulated depreciation and encumbrances, as of December 31 is summarized below:

	2018		2017
	(in thousands)
Real estate	$	30,232	$	30,916
Total real estate	$	30,232	$	30,916

The Company invests in mortgage loans that are collateralized by commercial properties, including multi-family residential buildings, which are managed as a single class of commercial mortgage loans. Mortgage loans are stated at original cost, net of principal payments and amortization. The Company segregates its portfolio by property type and geographic location. As of December 31, 2018 and 2017, the Company had $268.7 million and $90.9 million, respectively, in mortgage loans. The allowance for loans at December 31, 2018 was $0.5 million. There was no allowance for loan losses at December 31, 2017.

The following tables reflect the distribution of mortgage loans by property type as of December 31:

	2018		2017
	(in millions)
Industrial	$	13.5	$	13.8
Multifamily		53.9		29.7
Office		58.4		15.8
Retail		58.4		20.4
Self-storage		11.0		11.2
Warehouse		53.2		—
Other		20.8		—
Total mortgage loans		269.2		90.9
Less: Valuation allowance		0.5		—
Net mortgage loans	$	268.7	$	90.9

The following tables reflect the distribution of mortgage loans by geographic region as of December 31:

	2018		2017
	(in millions)
East North Central	$	37.1	$	15.1
Middle Atlantic		10.2		—
Mountain		37.1		7.5
New England		3.2		—
Pacific		83.2		23.4
South Atlantic		51.4		34.4
West North Central		6.2		—
West South Central		40.8		10.5
Total mortgage loans		269.2		90.9
Less: Valuation allowance		0.5		—
Net mortgage loans	$	268.7	$	90.9

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

To monitor credit quality, the Company primarily uses RBC code, which is the risk category used in the RBC calculation that is based on debt service coverage ratio and loan-to-value. The codes range from CM1 to CM7, with CM1 being the most stable. The Company holds $243.3 million CM1 loans and $25.9 million CM2 loans as of December 31, 2018. The Company held $84.9 million CM1 loans and $6.0 million CM2 loans as of December 31, 2017. All loans held at December 31, 2018 were issued during 2017 or 2018 and therefore have limited history. The maximum percentage of any one loan to the value of the collateral security at the time of the loan, exclusive of insured, guaranteed or purchase money mortgages, acquired during 2018 was 75%. As of December 31, 2018, all loans were current.

During 2018, the minimum and maximum lending rates for mortgage loans were 4.0% and 6.0% respectively. There were no taxes, assessments, or amounts advanced not included in the mortgage loan total. There were no impairments on mortgage loans or any loans derecognized as a result of foreclosure and there was no allowance for loan losses for the year ended December 31, 2018.

Other invested assets

Other invested assets as of December 31 are summarized below:

	2018		2017
	(in thousands)
Private equity	$	265,511	$	272,230
Mezzanine partnerships		148,320		163,503
Infrastructure funds		27,611		30,383
Hedge funds		6,980		7,775
Leverage leases		—		1,875
Mortgage and real estate		898		2,482
Direct equity		141,727		117,204
Credit funds		8,432		—
Other alternative assets		15,436		15,660
Total other invested assets	$	614,915	$	611,112

The Company has unfunded commitments related to its investments in limited partnerships in the amount of $152.3 million and $206.6 million as of December 31, 2018 and 2017, respectively. The Company has no investments in joint ventures, partnerships or limited liability companies that exceed 10% of its admitted assets.

Derivative instruments

Derivative instruments as of December 31 are summarized below:

	2018		2017
	(in thousands)
Swaps:
Notional amount	$	75,000	$	—
Fair value	$	1,951	$	—
Carrying value	$	—	$	—

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Restricted assets

Restricted assets (including pledged) relate mainly to statutory requirements of various jurisdictions, FHLB Stock and derivative collateral pledged as collateral. Restricted assets were $8.0 million and $5.3 million as of December 31, 2018 and 2017, respectively. These are included as assets on the Statements of Admitted Assets, Liabilities, and Capital and Surplus.

The Company is a member of the Federal Home Loan Bank (“FHLB”) of Boston. Membership with the FHLB is part of the Company’s strategy to access funds to support various spread-based businesses and enhance liquidity management. The Company has determined the estimated maximum borrowing capacity as $598.0 million. The Company calculated this amount in accordance with New York Consolidated Laws, Insurance Law - ISC § 1411. Authorization of, and Restrictions on, 1nvestments, whereby the loan shall not exceed, when the loan is made,5% of its admitted assets as shown by its last sworn statement to the superintendent. In 2018, the Company did not conduct business activity (borrowing) with the FHLB and did not pledge any assets to the FHLB. The Company owned $3.4 million of FHLB capital stock as of December 31, 2018, which was not eligible for redemption.

5GI Securities

5GI securities as of December 31 are summarized below:

	Number of 5GI Securities		Aggregate BACV				Aggregate Fair Value
	Current	Prior	Current		Prior		Current		Prior
Investment	Year	Year	Year		Year		Year		Year
	(in thousands)
(1) Bonds - Amortized Cost	30	20	$	13,676	$	8,675	$	13,205	$	7,434
(2) Loan-backed and structured
securities - Amortized Cost	—	3		—		53		—		43
(3) Preferred Stock - Amortized Cost	—	—		—		—		—		—
(4) Preferred Stock - Fair Value	—	—		—		—		—		—
(5) Total (1+2+3+4)	30	23	$	13,676	$	8,728	$	13,205	$	7,477

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Concentrations of credit risk of financial instruments

Credit exposure related to issuers and derivatives counterparties is inherent in investments and derivative contracts with positive fair value or asset balances. We manage credit risk through the analysis of the underlying obligors, issuers and transaction structures. We review our debt security portfolio regularly to monitor the performance of obligors and assess the stability of their credit ratings. We also manage credit risk through industry and issuer diversification and asset allocation. We classify debt securities into investment grade and below-investment-grade securities based on ratings prescribed by the NAIC. In a majority of cases, these classifications will coincide with ratings assigned by one or more Nationally Recognized Statistical Rating Organizations (“NRSROs”); however, for certain structured securities, the NAIC designations may differ from NRSRO designations based on the amortized cost of the securities in our portfolio. Maximum exposure to an issuer or derivative counterparty is defined by quality ratings, with higher quality issuers having larger exposure limits. As of December 31, 2018, we were not exposed to the credit concentration risk of any issuer other than U.S. government and government agencies backed by the faith and credit of the U.S. government, defined as exposure greater than 10% of total admitted assets. The top five largest exposures were Burlington Northern & Santa Fe, Wells Fargo Bank NA, AT&T Inc., Verizon Communications Inc. and Walgreens. We monitor credit exposures by actively monitoring dollar limits on transactions with specific counterparties. We have an overall limit on below-investment-grade rated issuer exposure. Additionally, the creditworthiness of counterparties is reviewed periodically. We use ISDA Master Agreements with derivative counterparties which may include Credit Support Annexes with collateral provisions to reduce counterparty credit exposures. To further mitigate the risk of loss on derivatives, we only enter into contracts in which the counterparty is a financial institution with a rating of A or higher from at least one NRSRO.

Net investment income

The principal components of net investment income for the years ended December 31 were as follows:

	2018		2017
	(in thousands)
Bonds	$	348,400	$	358,172
Contract loans		175,413		175,797
Cash and short-term investments		588		2,004
Real estate, net of expenses		1,312		1,222
Preferred stock		7,496		9,078
Common stock		18		921
Mortgage loans		8,714		1,184
Other invested assets		59,449		87,261
Derivative instruments.		423		—
Miscellaneous income		1,968		1,422
Amortization of interest maintenance reserve ("IMR")		14,478		13,813
Less:
Interest expense		9,086		9,086
Other investment expenses		21,026		16,616
Net investment income		588,147		625,172

For the year ended December 31, 2018, the Company had 34 securities called or redeemed by the issuer, resulting in income from prepayment penalties and acceleration fees of $4.8 million.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Capital gains and losses

The principal components of realized gains (losses) and changes in unrealized capital gains (losses) on investments for the years ended December 31 were as follows:

	Realized						Change in Unrealized
	2018			2017			2018			2017
	(in thousands)
Bonds	$	2,054		$	29,056		$	(1,252	)	$	822
Preferred stock		364			(454	)		(2,474	)		(184	)
Common stock		(235	)		1,820			8,413			1,449
Mortgage loans		(540	)		—			—			—
Other invested assets		(63	)		(1,660	)		26,851			(1,290	)
Derivative instruments		—			(4,108	)		—			3,173
Foreign exchange		(370	)		(195	)		(54	)		264
Miscellaneous		(640	)		(135	)		—			—
		570			24,324			31,484			4,234
Income tax benefit (expense)		(1,562	)		(18,071	)		(6,612	)		(1,482	)
Net capital gains (losses)	$	(992	)	$	6,253		$	24,872		$	2,752

Realized losses for 2018 include impairments of $11.4 million, including impairments on bonds of $5.8 million, common stock of $5.6 million, preferred stock of $0 and other invested assets of $0. Realized losses for 2017 include impairments of $16.2 million, including impairments on bonds of $10.1 million, common stock of $4.1 million, preferred stock of $0.4 million and other invested assets of $1.6 million.

The proceeds and related gross realized gains and losses from sales of stocks and bonds, for the years ended December 31 were as follows:

	2018		2017
	(in thousands)
Proceeds from sales	$	1,454,353	$	3,152,621
Gross gains on sales		21,989		115,961
Gross losses on sales		25,652		19,352

5. Investments in Affiliates

In 2018, The Company formed an investment subsidiary, Nassau 2018 CFO Fund, LLC. The Company uses the “look through” process, per Paragraph 26 of SSAP No. 97, Investments in Subsidiary, Controlled and Affiliated Entities, to admit the underlying assets of the subsidiary. The Company’s other subsidiary, PM Holdings, has no underlying value ascribed to it. There was no subsidiary equity that was non-admitted as of December 31, 2018 and 2017.

Nassau Life Insurance Company *(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

6. Reserves for Future Policy Benefits

The basis of assumptions for NNY’s major categories of reserves for future policy benefits and claims and settlements as of December 31 is summarized below:

	2018		2017
	(in thousands)
Life insurance:
American Experience, 2.5% to 4.0%	$	1,532	$	1,906
1941 CSO, 2.25% to 4.0%		100,855		112,278
1958 CSO, 2.0% to 6.0%		1,541,961		1,621,301
1980 CSO, <4.5% to 6.0%		2,964,819		3,070,302
1980 CSO Select, 4.5%.		38,718		39,383
1980 CSO, 3.5% to 4.5%		4,444,192		4,493,999
2001 CSO 4.0% to 4.25%		56,642		53,483
Various		18,384		23,794
Total life insurance	$	9,167,103	$	9,416,446

Annuities		218,710		229,399

Claim and loss liabilities:
Disability		31,496		34,829
Accident and health.		35,621		38,952
Total claim and loss liabilities		67,117		73,781
Subtotal		9,452,930		9,719,626
Supplementary contracts with life contingencies		83,999		83,665
All other		7,382		13,536
Total before reinsurance ceded		9,544,311		9,816,827
Less: Reinsurance ceded		352,591		365,817
Reserves for future policy benefits	$	9,191,720	$	9,451,010

The amount of individual insurance in force as of December 31, 2018 and 2017 for which the net premium exceeded the gross premium was $0.8 billion and $0.9 billion, respectively. As of December 31, 2018 and 2017, the Company carried an associated premium deficiency reserve of $4.3 million and $5.1 million, respectively, included in reserves for future policy benefits. Anticipated investment income was utilized in the calculation.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Withdrawal characteristics

Withdrawal characteristics of annuity actuarial reserves and deposit liabilities as of December 31 are as follows:

	2018				2017
	(in thousands)		% of total		(in thousands)		% of total
Subject to discretionary withdrawal - with market value adjustment:
- with market value adjustment	$	23,828	2	%	$	25,711	2	%
- at book value less surrender charge of 5% or more		14	—	%		—	—	%
- at market value		295,527	28	%		366,186	32	%
Subtotal		319,369	30	%		391,897	34	%

Subject to discretionary withdrawal - without adjustment:
- at book value (minimal or no charge or adjustment)		615,585	57	%		624,573	54	%
Not subject to discretionary withdrawal		137,334	13	%		145,343	12	%
Total annuity actuarial reserves and deposit fund liabilities		1,072,288	100	%		1,161,813	100	%
Less: Reinsurance ceded		9,547				9,819
Total annuity actuarial reserves and deposit fund liabilities, net of reinsurance	$	1,062,741			$	1,151,994

Reinsurance with unauthorized companies

NNY has ceded insurance liabilities to insurers not licensed in the State of New York. To the extent such liabilities are not collateralized, New York insurance regulators require the establishment of a liability through a charge to surplus equal to the ceded liabilities placed with such companies. These liabilities were $0.6 million and $2.4 million as of December 31, 2018 and 2017, respectively, and are included in accrued expenses and general liabilities.

Reinsurance agreements with affiliates

PHL has a treaty in force with the Company, whereby NNY has assumed, on a 90% coinsurance basis, all Phoenix Accumulator Universal Life III and IV sold by PHL from January 1 to December 31, 2008. The reserves ceded to NNY for these policies were $76.5 million and $75.5 million at December 31, 2018 and 2017, respectively.

Effective June 30, 2015, the Company entered into a MODCO reinsurance agreement with PHL. This agreement provides that the Company will retrocede, and PHL will reinsure, 80% of the inforce GEO corporate-owned whole life insurance policies assumed by the Company from a third-party. Under MODCO, the assets, which are equal to the statutory reserves held for the reinsured policies, and liabilities associated with the assumed business are retained by the Company, and PHL will receive the economic risks and rewards related to the assumed business through MODCO adjustments. PHL, having the right of offset, has offset the MODCO asset and liability.

Direct business written and reinsurance assumed and ceded

As is customary practice in the insurance industry, NNY assumes and cedes reinsurance as a means of diversifying underwriting risk.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

NNY’s reinsurance program varies based on the type of risk, for example:

●	For business sold prior to December 31, 2010, the Company’s retention limit on any one life is $10 million for single life and joint first-to-die policies and $12 million for joint last-to-die policies. Beginning January 1, 2011, the Company’s retention limit on new business is $5 million for single life and joint first-to-die policies and $6 million for second-to-die policies.

●	NNY cedes up to 80% on policies in its term life insurance.

Additional information on direct business written and reinsurance assumed and ceded for the years ended December 31 is set forth below:

	2018			2017
	(in thousands)
Direct premiums and annuity considerations	$	367,246		$	399,472
Reinsurance assumed - non-affiliate		8,848			9,072
Reinsurance assumed - affiliate		23,037			44,953
Reinsurance ceded - non-affiliate		(140,863	)		(150,056	)
Reinsurance ceded - affiliate		(6,292	)		(6,830	)
Net premiums and annuity considerations	$	251,976		$	296,611

Direct commission s and expense allowance.	$	3,840		$	4,444
Reinsurance assumed - non-affiliate		324			595
Reinsurance assumed - affiliate		1,634			2,467
Reinsurance ceded - non-affiliate		(5,791	)		(6,327	)
Reinsurance ceded - affiliate		(7,400	)		(7,058	)
Net commissions and expense allowance	$	(7,393	)	$	(5,879	)

Direct policy and contract claims incurred	$	655,434		$	610,978
Reinsurance assumed - non-affiliate		81,154			65,405
Reinsurance assumed - affiliate		14,551			3,616
Reinsurance ceded - non affiliate		(232,163	)		(201,725	)
Reinsurance ceded - affiliate		(59,329	)		(51,194	)
Net policy and contract claims incurred	$	459,647		$	427,080

Direct policy and contract claims payable.	$	122,898		$	117,623
Reinsurance assumed - non-affiliate		47,152			64,817
Reinsurance assumed - affiliate		163			276
Reinsurance ceded - non-affiliate		(33,387	)		(25,449	)
Net policy and contract claims payable	$	136,826		$	157,267

Direct life insurance in force	$	28,458,804		$	30,497,149
Reinsurance assumed		2,927,687			2,945,450
Reinsurance ceded		(13,360,421	)		(14,202,841	)
Net insurance in force	$	18,026,070		$	19,239,758

In the event all reinsurance agreements were to be terminated, the Company estimates the aggregate reduction in surplus would be $17.0 million and $17.5 million for the years ended December 31, 2018 and 2017, respectively.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Change in incurred losses and loss adjustment expenses

Reserves on Group Accident and Health policies were $21.7 million as of December 31, 2017. As of December 31, 2018, $4.1 million has been paid for incurred losses attributable to insured events of prior years. Reserves remaining for prior years are now $19.1 million as a result of unpaid claims principally on the Group Accident and Health line of business. Therefore, there has been $1.4 million of unfavorable prior year development since December 31, 2017. Increases or (decreases) are generally the result of ongoing analysis of recent loss development trends. Original estimates are increased or decreased as additional information becomes known regarding individual claims.

7. Leases and Rentals

Rental expense for operating leases, principally with respect to office equipment and office space, amounted to $1.3 million and $1.6 million in 2018 and 2017, respectively. Future minimum rental payments under non-cancelable operating leases were approximately $2.8 million as of December 31, 2018, payable as follows: 2019 - $0.6 million; 2020 - $0.5 million; 2021 - $0.5 million; 2022 - $0.6 million and 2023 - $0.6 million.

8. Electronic Data Processing Equipment

Electronic data processing (“EDP”) equipment and software, gross, as of December 31, 2018 and 2017 was $76.9 million and $77.0 million, respectively. EDP accumulated depreciation as of December 31, 2018 and 2017 was $69.6 million and $66.0 million, respectively. Depreciation for the year ended December 31, 2018 and 2017 was $3.7 million and $4.6 million, respectively. EDP equipment and software are depreciated over 3 to 5 years, using straight-line and accelerated methods. Non-admitted EDP equipment totaled $7.3 million and $11.0 million as of December 31, 2018 and 2017, respectively.

9. Furniture and Fixtures

Furniture and equipment cost as of December 31, 2018 and 2017 was $6.5 million and $7.6 million, respectively. Accumulated depreciation as of December 31, 2018 and 2017 was $5.9 million and $6.8 million, respectively. Depreciation for the years ended December 31, 2018 and 2017 was $0.2 million and $0.2 million, respectively. Non-admitted furniture and equipment totaled $0.6 million and $0.8 million as of December 31, 2018 and 2017, respectively.

Depreciation or amortization periods are generally 7 years for furniture and equipment, leasehold improvements, and building improvements. Depreciation or amortization is generally calculated using the straight-line method.

10. Premium and Annuity Considerations Deferred and Uncollected

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2018 were as follows:

Type of Business	Gross		Net of Loading
	(in thousands)
Ordinary new	$	—	$	—
Ordinary renewal		68,799		68,807
Total	$	68,799	$	68,807

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2017 were as follows:

Type of Business	Gross		Net of Loading
	(in thousands)
Ordinary new	$	1	$	1
Ordinary renewal		72,285		72,325
Total	$	72,286	$	72,326

11. Separate Accounts

In accordance with the products/transactions recorded within the separate account, the legal insulation of the separate account assets prevents such assets from being generally available to satisfy claims resulting from the general account. As of December 31, 2018 and 2017, the Company separate account statement included legally insulated assets of $942.3 million and $1,121.2 million, respectively.

As of December 31, 2018, the general account of the Company had a maximum guarantee for separate account liabilities of $3.3 million. To compensate the general account for the risk taken, the separate account paid risk charges of $0.6 million and $0.6 million for the years ended December 31, 2018 and 2017, respectively. The general account paid $0.6 million and $0.6 million relating to separate account guarantees for the years ended December 31, 2018 and 2017, respectively.

The Company does not engage in securities lending transactions within the separate accounts.

Reserves for separate account liabilities were $941.5 million and $1,120.1 million as of December 31, 2018 and 2017, respectively. Separate account premiums and other considerations received were $35.8 million and $37.9 million for the years ended December 31, 2018 and 2017, respectively, and were reported as revenue in the Statements of Income and Changes in Capital and Surplus. Withdrawals at market value were $68.4 million and $83.1 million for the years ended December 31, 2018 and 2017, respectively, and were reported as benefits in the Statements of Income and Changes in Capital and Surplus.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

	2018			2017
	(in thousands)
Transfers to separate accounts	$	35,799		$	37,928
Transfers from separate accounts		(95,775	)		(107,314	)
Other		—			26
Net transfers from separate account		(59,976	)		(69,360	)

Transfers as reported in the Statements of Income and Changes in Capital and Surplus	$	(59,976	)	$	(69,360	)

12. Federal Income Taxes

On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act (“the Act”), which established new laws including, but not limited to, reduction in the federal income tax rate for corporations from 35% to 21%. In 2017, the Company was required to recognize the effect on deferred tax assets and liabilities of a change in tax rates in the period the tax rate change was enacted. Accordingly, the enacted reduction in the U.S. Federal corporate income tax rate resulted in a one-time charge of approximately $71 million for the year ended December 31, 2017. For the year ended December 31, 2018, residual rate reduction adjustments of approximately $2 million were recorded, which were attributable to provision-to-return adjustments related to 2017.

For Statutory accounting purposes, the NAIC adopted INT 18-01, which generally adopted the guidance put forth by the SEC in Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”). SAB 118 directed taxpayers to consider the impact of the U.S. legislation as “provisional” when it did not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the change in tax law. In accordance with SAB 118 and INT 18-01, the Company recorded provisional estimates in its 2017 financial statements associated with tax reserves and the Alternative Minimum Tax Credit (“AMT”), which represented its best estimate based on interpretation of the U.S. legislation at the time. During 2018, the Company subsequently accumulated refined data to finalize the underlying calculations, and the U.S Treasury issued further guidance on the application of certain provisions of the legislation.

As a result, in accordance with SAB 118 and INT-18-01, the adjustment of $127 million to tax reserves as of December 31, 2017 and the reclassification of available refundable AMT credits to current taxes receivable of $2 million pursuant to recently issued guidance is considered final and represents updates to the provisional estimated recorded in 2017.

The Act also provides a base erosion and anti-abuse tax (“BEAT”) which represents minimum tax calculated on a base equal to the taxpayer’s taxable income determined without regard to: (1) the tax benefits arising from base erosion payments, and (2) the applicable base erosion percentage of any NOL allowed for the tax year. The BEAT rate is 5% for the tax years beginning in calendar year 2018, 10% for tax years beginning in 2019 through 2025 and 12.5% percent for tax years beginning after December 21, 2025. The Company believes any BEAT liability is not material for the year ended December 31, 2018.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The components of the net deferred tax asset/(liability) at period end and the change in those components are as follows:

	December 31, 2018						December 31, 2017						Change
	Ordinary		Capital		Total		Ordinary		Capital		Total		Ordinary			Capital			Total
	(in thousands)
Gross deferred tax assets	$	138,182	$	6,800	$	144,982	$	122,613	$	7,414	$	130,027	$	15,569		$	(614	)	$	14,955
Statutory valuation allowance		—		—		—		—		—		—		—			—			—
Adjusted gross deferred tax assets		138,182		6,800		144,982		122,613		7,414		130,027		15,569			(614	)		14,955
Less: Deferred tax assets non-admitted		23,269		6,800		30,069		44,042		7,414		51,456		(20,773	)		(614	)		(21,387	)
Subtotal net admitted deferred tax assets		114,913		—		114,913		78,571		—		78,571		36,342			—			36,342
Less: Deferred tax liabilities		57,576		—		57,576		19,743		—		19,743		37,833			—			37,833
Net deferred tax assets	$	57,337	$	—	$	57,337	$	58,828	$	—	$	58,828	$	(1,491	)	$	—		$	(1,491	)

	December 31, 2018						December 31, 2017									Change
	Ordinary		Capital		Total		Ordinary		Capital		Total		Ordinary			Capital			Total
	(in thousands)
Federal income taxes paid in prior years recoverable through loss carrybacks	$	—	$	—	$	—	$	—	$	—	$	—	$	—		$	—		$	—
Adjusted gross deferred tax assets expected to be realized after application of the threshold limitation		57,337		—		57,337		58,828		—		58,828		(1,491	)		—			(1,491	)
1) Adjusted gross deferred tax assets expected to be realized following the balance sheet date		57,337		—		57,337		61,912		—		61,912		(4,575	)		—			(4,575	)
2) Adjusted gross deferred tax assets allowed per limitation threshold		XXX		XXX		68,636		XXX		XXX		58,828		XXX			XXX			9,808
Adjusted gross deferred tax assets offset by gross deferred tax liabilities		57,576		—		57,576		19,743		—		19,743		37,833			—			37,833
Deferred tax assets admitted as the result of application of SSAP 101	$	114,913	$	—	$	114,913	$	78,571	$	—	$	78,571	$	36,342		$	—		$	36,342

	2018			2017
	($ in thousands)
Ratio percentage used to determine recovery period and threshold limitation amount		821	%		862	%
Amount of adjusted capital and surplus used to determine recovery period
and threshold limitation	$	672,811		$	611,888

	December 31, 2018						December 31, 2017						Change
	Ordinary			Capital			Ordinary			Capital			Ordinary			Capital
	($ in thousands)
Impact of tax planning strategies
Adjusted gross DTAs	$	138,182		$	6,800		$	122,613		$	7,414		$	15,569		$	(614	)
% of total adjusted gross DTAs		—	%		—	%		—	%		—	%		—	%		—	%
Net admitted adjusted gross DTAs	$	114,913		$	—		$	78,571		$	—		$	36,342		$	—
% of total net admitted adjusted gross DTAs		—	%		—	%		—	%		—	%		—	%		—%

Management believes the Company will be able to utilize the DTA in the future without any tax planning strategies.

Regarding deferred tax liabilities that are not recognized, the Company has no temporary differences for which deferred tax liabilities have not been established.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

	2018			2017		Change
	(in thousands)
Current income tax:
Federal	$	(1,473	)	$	14,244	$	(15,717	)
Foreign		—			—		—
Subtotal		(1,473	)		14,244		(15,717	)
Federal income tax on net capital gains		1,562			18,072		(16,510	)
Utilization of capital loss carryforwards		—			—		—
Other		—			—		—
Federal and foreign income tax expense (benefit) incurred	$	89		$	32,316	$	(32,227	)

Deferred tax assets:
Ordinary
Future policyholder benefits	$	45,672		$	20,138	$	25,534
Investments		27,735			31,476		(3,741	)
Deferred acquisition costs		29,010			31,552		(2,542	)
Policyholder dividends accrual		24,448			24,696		(248	)
Fixed assets		—			2,646		(2,646	)
Compensation and benefits accrual		3,901			2,382		1,519
Pension accrual		—			—		—
Net operating loss carryforward		—			—		—
Tax credit carryforward		2,272			4,543		(2,271	)
Other (including items <5% of total ordinary tax assets)		5,144			5,180		(36	)
Subtotal		138,182			122,613		15,569
Non-admitted		23,269			44,042		(20,773	)
Admitted ordinary deferred tax assets	$	114,913		$	78,571	$	36,342

Capital:
Investments	$	4,782		$	4,912	$	(130	)
Net capital loss carryforward		—			—		—
Other (including items <5% of total capital tax assets)		2,018			2,502		(484	)
Subtotal		6,800			7,414		(614	)
Non-admitted		6,800			7,414		(614	)
Admitted capital deferred tax assets		—			—		—
Admitted deferred tax assets	$	114,913		$	78,571	$	36,342

Deferred tax liabilities:
Ordinary
Investments	$	25,125		$	19,743	$	5,382
Fixed assets		1,050			—		1,050
Policyholder reserves		25,857			—		25,857
Other (including items <5% of total ordinary tax liabilities)		5,544			—		5,544
Subtotal		57,576			19,743		37,833

Capital:
Investments		—			—		—
Deferred tax liabilities		57,576			19,743		37,833
Net admitted deferred tax assets (liabilities)	$	57,337		$	58,828	$	(1,491	)

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Reconciliation of federal income tax rate to actual effective rate:

	December 31, 2018
							Effective
	Amount			Tax Effect			Tax Rate
	(in thousands)
Income before taxes	$	94,322		$	19,808		21.0	%
Interest maintenance reserve		(15,028	)		(3,156	)	(3.3	%)
Dividends received deduction		(2,285	)		(480	)	(0.5	%)
Return to provision		6,449			1,354		1.4	%
Change in non-admitted assets		4,413			927		1.0	%
Rate change		(7,388	)		(1,551	)	(1.6	%)
Other, including prior year true-up		4,539			953		1.0	%
Total statutory income tax	$	85,022		$	17,855		18.9	%

Federal income taxes incurred				$	1,051		1.1	%
Tax on capital gains/(losses)					1,561		1.7	%
Prior year overaccrual/(underaccrual)					(2,524	)	(2.7	%)
Change in net deferred income tax expense/(benefit)					17,766		18.8	%
Total statutory income tax				$	17,854		18.9	%

	December 31, 2017
							Effective
	Amount			Tax Effect			Tax Rate
	(in thousands)
Income before taxes	$	100,702		$	35,246		35.0	%
Interest maintenance reserve		52,977			18,542		18.4	%
Dividends received deduction		(8,013	)		(2,805	)	(2.8	%)
Return to provision		(402	)		(141	)	(0.1	%)
Change in non-admitted assets		10,826			3,789		3.8	%
Rate change		201,411			70,494		70.0	%
Other, including prior year true-up		(1,189	)		(416	)	(0.4	%)
Total statutory income tax	$	356,312		$	124,709		123.8	%

Federal income taxes incurred				$	4,205		4.2	%
Tax on capital gains/(losses)					18,071		17.9	%
Prior year overaccrual/(underaccrual)					10,039		10.0	%
Change in net deferred income tax expense/(benefit)					92,394		91.7	%
Total statutory income tax				$	124,709		123.8	%

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Carryforwards, recoverable taxes and IRC 6603 deposits:

	2018		2017
	(in thousands)
The Company had net operating losses of	$	—	$	—
The Company had capital loss carryforwards of		—		—
The Company had alternative minimum tax credit carryforwards of		2,272		4,543

The alternative minimum tax credit carryforwards do not expire.

The Company has no income tax expense for 2016, 2017 and 2018 that are available for recoupment in the event of future net losses.

Deposits admitted under IRC 6603

There were no deposits reported as admitted assets under Section 6603 of the Internal Revenue Service (“IRS”) Code as of December 31, 2018.

Uncertain tax positions are assessed under the applicable statutory accounting guidance. Based upon this review, the Company has no potential tax assessments. As of December 31, 2018, the Company has recognized no amount for interest or penalties related to uncertain tax positions. Based upon existing information, the Company does not expect a material change in the recognized liability in the next 12 months. The Company has no tax loss contingencies for which it is reasonably possible that the total liability will significantly increase within twelve months of the reporting date.

The following companies, except as noted, were included in the consolidated federal income tax return for 2017 and all or part of 2018:

The Nassau Companies of New York, Inc.
PM Holdings, Inc.
Nassau Life Insurance Company
PHL Variable Insurance Company
Nassau Life and Annuity Company
Phoenix Founders, Inc.
1851 Securities, Inc.
American Phoenix Life and Reassurance Company -- Sold in 2017

13. Related Party Transactions

NCNY provides services and facilities to the Company that are reimbursed through shared service agreement/cost allocation process. Expenses allocated by NCNY on the Company’s behalf were $88.1 million and $138.5 million for the years ended December 31, 2018 and 2017, respectively. The amounts payable to NCNY were $6.2 million and $1.2 million as of December 31, 2018 and 2017, respectively.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

1851 Securities, Inc. (“1851”), a wholly owned subsidiary of NSRE BD Holdco LLC, is the principal underwriter of the Company’s variable life insurance policies and variable annuity contracts. The Company reimburses 1851 for commissions incurred on behalf of PHL and NLA. Commissions paid by the Company on behalf of PHL were $3.7 million and $4.8 million for the years ended December 31, 2018 and 2017, respectively. There were no amounts receivable from PHL or NLA as of December 31, 2018 and 2017.

The Company pays commissions to producers who sell non-registered life and annuity products on behalf of PHL and NLA. Commissions paid by the Company on behalf of PHL were $54.0 million and $49.3 million for the years ended December 31, 2018 and 2017, respectively. Commissions paid by the Company on behalf of NLA were $0.3 million for the year ended December 31, 2018. The Company had amounts receivable from PHL and NLA of $3.4 million and $0.2 million as of December 31, 2018, respectively. The Company had amounts receivable from PHL of $3.0 million as of December 31, 2017.

The Company’s affiliate, Nassau Asset Management LLC (“NAMCO”) provides investment and related advisory services through an Investment Management Agreement. Expenses incurred under this agreement were $17.5 million and $16.4 million as of December 31, 2018 and 2017, respectively. Amounts receivable from NAMCO were $0.4 million and $0.2 million for the years ended December 31, 2018 and 2017, respectively.

The Company has investments in various classes of notes of Nassau 2017-I Ltd., Nassau 2017-II Ltd., Nassau 2018-I Ltd., Nassau 2018-II Ltd. and Nassau 2019-I Ltd. Warehouse (the “Nassau CLOs”) totaling $52.1 million par with a fair value of $48.0 million and $13.3 million par with a fair value of $13.1 million at December 31, 2018 and 2017, respectively. The Nassau CLOs are managed by NCC CLO Manager, LLC, an affiliate of NNY.

Saybrus Partners, LLC (“Saybrus”), an affiliate of Nassau, provides wholesaling services to various third party distributors and affiliates of variable life insurance and variable annuities.

PHL provides premium processing services for the Company, wherein PHL receives payments on the Company’s annuity contracts and forwards those payments to the Company. In connection with these services, the Company had amounts receivable from PHL of $16.2 million and $15.3 million as of December 31, 2018 and 2017, respectively. PHL did not charge any fees for this service.

The Company, through PHL, provides premium processing services for NLA, wherein the Company receives premium payments on NLA life and annuity contracts and then forwards them to NLA. In connection with this service, the Company had amounts due to NLA of $0.1 million and $0.6 million as of December 31, 2018 and 2017, respectively. The Company did not charge for these services.

The Company had other transactions with amounts due from PHL of $2.0 million as of December 31, 2018.

See Note 6 for additional information on reinsurance agreements with affiliates.

The Company has written intercompany agreements in place with its affiliates that contain a settlement date for amounts owed. As of December 31, 2018, no amounts were overdue.

14. Fair Value Disclosures of Financial Instruments

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

Bonds and preferred stock

Common stock

Surplus debentures

Investment contracts

The fair value of guaranteed interest contracts was assumed to be the same as book value.

Derivatives

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Financial assets and liabilities measured at fair value

The Company’s financial assets and liabilities carried at fair value have been classified, for disclosure purposes, based on a hierarchy defined by ASC 820, Fair Value Measurements and Disclosures. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset’s or a liability’s classification is based on the lowest level input that is significant to its measurement. For example, a Level 3 fair value measurement may include inputs that are both observable (Levels 1 and 2) and unobservable (Level 3). The levels of the fair value hierarchy are as follows:

●	Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 1 securities include highly liquid government bonds and exchange-traded equities.
●	Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Examples of such instruments include government-backed mortgage products, certain collateralized mortgage and debt obligations and certain high-yield debt securities.
●	Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs reflect management’s own assumptions about inputs in which market participants would use in pricing these types of assets or liabilities. Level 3 financial instruments include values which are determined using pricing models and third-party evaluation. Additionally, the determination of some fair value estimates utilizes significant management judgments or best estimates.

The following table provides information as of December 31, 2018 about the Company’s financial assets and liabilities measured at fair value on a recurring basis.

	2018
	Level 1		Level 2		Level 3		Total
	(in thousands)
Assets at fair value:
Bonds	$	—	$	5,220	$	3,945	$	9,165
Preferred stock		—		—		11,893		11,893
Common stock [1]		978		3,412		54,259		58,649
Subtotal.		978		8,632		70,097		79,707

Separate account assets		935,480		6,828		—		942,308
Total assets at fair value	$	936,458	$	15,460	$	70,097	$	1,022,015

____________________
[1]	Includes $3,412 thousand Class A Membership FHLB common stock.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

The following table provides information as of December 31, 2017 about the Company’s financial assets and liabilities measured at fair value on a recurring basis.

	2017
	Level 1		Level 2		Level 3		Total
	(in thousands)
Assets at fair value:
Bonds	$	—	$	—	$	1,434	$	1,434
Preferred stock		—		—		8,142		8,142
Common stock		304		—		49,112		49,416
Subtotal		304		—		58,688		58,992

Separate account assets		1,112,832		8,403		—		1,121,235
Total assets at fair value	$	1,113,136	$	8,403	$	58,688	$	1,180,227

Fair values and changes in the fair values of separate account assets generally accrue directly to the policyholders and are not included in the Company’s revenues and expenses or surplus.

Changes in Level 3 Assets and Liabilities Measured at Fair Value

	2018			2017
	(in thousands)
Level 3 Assets:
Balance, beginning of period	$	58,688		$	65,144
Purchases		4,957			3,373
Sales		(4,970	)		(8,440	)
Settlements.		(107	)		(4	)
Transfers into Level 3		19,960			12,689
Transfers out of Level 3		(9,728	)		(10,669	)
Realized gains (losses)		(1,661	)		(1,684	)
Unrealized gains (losses)		2,958			(1,721	)
Balance, end of period	$	70,097		$	58,688

Transfers in and out of Level 3 occur at the beginning of each period. The securities which were transferred into Level 3 for the years ended December 31, 2018 and 2017 were due to decreased market observability of similar assets and/or changes to NAIC ratings. Transfers out of Level 3 for the year ended December 31, 2018 were due to the increased market observability of similar assets and/or securities previously being held at fair value now being carried at amortized cost. Transfers out of Level 3 for the year ended December 31, 2017 were due to the implementation of due diligence procedures which allowed for a refinement of the analysis of observable inputs as described in more detail above. There were no transfers from Level 2 to Level 1 recorded during the years ended December 31, 2018 and 2017.

Nassau Life Insurance Company
*(a wholly owned subsidiary of The Nassau Companies of New York)*
Notes to Statutory Financial Statements	(continued)

Below is a listing of the aggregate fair value for all financial instruments as of December 31, 2018 and the level within the fair value hierarchy:

											Not
											Practicable
	Aggregate		Admitted								(Carrying
	Fair Value		Assets		Level 1		Level 2		Level 3		Value)
	(in thousands)
Financial Instruments:
Bonds	$	7,174,708	$	7,212,940	$	—	$	4,730,477	$	2,444,231	$	—
Preferred stock		127,881		125,947		—		76,592		51,289		—
Common stock		58,649		58,649		978		3,412		54,259		—
Mortgage loans		266,221		268,735		—		—		266,221		—
Surplus debentures & capcos		14,350		13,244		—		3,406		10,944		—
Cash, cash equivalents & short terms		56,891		56,891		56,645		130		116		—
Derivatives		1,951		—		1,951		—		—		—
Separate account assets		942,308		942,308		935,480		6,828		—		—
Total financial instruments	$	8,642,959	$	8,678,714	$	995,054	$	4,820,845	$	2,827,060	$	—

As of December 31, 2018, the Company had no investments where it is not practicable to estimate fair value.

Below is a listing of the aggregate fair value for all financial instruments as of December 31, 2017 and the level within the fair value hierarchy:

											Not
											Practicable
	Aggregate		Admitted								(Carrying
	Fair Value		Assets		Level 1		Level 2		Level 3		Value)
	(in thousands)
Financial Instruments:
Bonds	$	7,778,592	$	7,417,789	$	—	$	5,070,949	$	2,707,643	$	—
Preferred stock		130,561		124,890		—		78,662		51,899		—
Common stock		49,416		49,416		304		—		49,112		—
Mortgage loans		90,939		90,939		—		—		90,939		—
Surplus debentures & capcos		15,757		13,809		—		3,704		12,053		—
Cash, cash equivalents & short terms		356,007		356,007		211,350		144,657		—		—
Separate account assets		1,121,235		1,121,235		1,112,832		8,403		—		—
Total financial instruments	$	9,542,507	$	9,174,085	$	1,324,486	$	5,306,375	$	2,911,646	$	—

As of December 31, 2017, the Company had no investments where it is not practicable to estimate fair value.

For the years ended December 31, 2018 and 2017, Level 3 bonds were primarily private placement debt securities priced using our internal discounted cash flow model. Market spreads used in the model were unobservable. Nearly all of these securities were in the Industrial and Miscellaneous category.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

15. Surplus Notes

NNY’s 7.15% surplus notes are due December 15, 2034 and were originally issued with a face value of $175.0 million. During September 2012, the Company retired $48.3 million face value of these surplus notes, after receiving prior approval from the Department. Interest payments also require the prior approval of the Department and may be made only out of surplus funds that the Department determines to be available for such payments under New York insurance law. The 7.15% surplus notes were issued December 15, 2004 and interest on the notes is scheduled to be paid on June 15 and December 15 of each year, commencing June 15, 2005. Interest payments for these notes for 2018 and 2017 each totaled $9.1 million. The 7.15% surplus notes may be redeemed at the option of NNY at any time at the “make-whole” redemption price set forth in the offering circular. New York insurance law provides that the notes are not part of the legal liabilities of NNY. The 7.15% notes were issued pursuant to Rule 144A under the Securities Act of 1933. No affiliate holds any portion of the notes.

Below are the details on the outstanding surplus notes (amounts in millions):

Interest

Total

Unapproved

Par Value

Carrying

and/or

Interest

Date

Interest

(Face Value

Value

Principal Paid

and/or

Date of

Issued

Rate

of Notes)

of Notes

Current Year

Principal Paid

Principal

Maturity

(in millions)

12/15/2004

7.15%

126.7

126.3

9.1

192.8

—

12/15/2034

16. Commitments and Contingencies

Litigation and regulatory matters

17. Other Commitments

The Company has a technology services agreement related to the management of our IT infrastructure which expires in 2019. As of December 31, 2018, the remaining commitments total $8.9 million.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

On January 5, 2015, the Company committed to purchase $50.0 million in investment grade rated infrastructure bonds through an outside investment advisor. These purchases were expected to be made over 24 months. On November 21, 2016, the agreement was amended to extend the purchase period to 36 months. The arrangement may be terminated prior to funding the committed amount at the discretion of the Company subject to certain standard provisions for notice and immaterial fees. As of December 31, 2018, $36.3 million has been funded.

As part of its normal investment activities, the Company enters into agreements to fund limited partnerships that make debt and equity investments. As of December 31, 2018, the Company had unfunded commitments of $152.3 million.

In addition, the Company enters into agreements to purchase private placement investments. At December 31, 2018, the Company had open commitments of $43.5 million.

18. Information about Financial Instruments with Off-Balance Sheet Risk

The Company, at December 31, 2018 and 2017, held the following financial instruments with off-balance sheet risk:

	Assets*				Liabilities*
	2018		2017		2018		2017
	(in thousands)
Swaps	$	75,000	$	—	$	—	$	—
Total	$	75,000	$	—	$	—	$	—

____________________

Notional amount

The Company uses derivative instruments including interest rate swaps. A more detailed description of these instruments is provided in Footnote 2 - “Summary of Significant Accounting Policies.”

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Notes to Statutory Financial Statements

(continued)

19. Appropriated Surplus

Surplus includes amounts available for contingencies, some of which are required by state regulatory authorities. The contingency amounts as of December 31, 2018 and 2017 were $2.5 million.

20. Subsequent Events

The Company evaluated events subsequent to December 31, 2018 and through April 29, 2019, the date of issuance of these financial statements. There were no events occurring subsequent to the end of the year that merited recognition or disclosure in these financial statements.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Supplemental Schedule
Summary of Investments - Other than Investments in Related Parties
December 31, 2018 and 2017

					Amount shown
	Amortized		Fair		in the
December 31, 2018	Cost		Value		balance sheet
		(in thousands)
Fixed maturities:
Bonds:
U.S. government and government agencies and authorities	$	260,286	$	267,101	$	260,286
States, municipalities and political subdivisions		991,382		1,008,524		991,382
Foreign governments		77,571		79,522		77,571
All other corporate bonds [1]		5,869,126		5,806,937		5,883,701
Total fixed maturities		7,198,365		7,162,084		7,212,940
Equity securities:
Common stock:
Industrial, miscellaneous and all other		58,649		58,649		58,649
Nonredeemable preferred stock		125,947		127,881		125,947
Total equity securities		184,596		186,530		184,596
Mortgage loans		268,735		266,221		268,735
Real estate, at depreciated cost		30,232		XXX		30,232
Contract loans		2,326,802		XXX		2,326,802
Other invested assets [2]		617,436		618,541		614,915
Cash and short-term investments		56,891		56,891		56,891
Receivables for securities		7,474		XXX		7,474
Total cash and invested assets	$	10,690,531			$	10,702,585

____________________

[1]	Amortized cost and fair value amounts exclude $14,575 and $12,622, respectively, of related-party bonds.
[2]	Difference between amortized cost and amount on balance sheet relates to $2,521 of non-admitted other invested assets.

See accompanying independent auditors’ report.

(continued)

					Amount shown
	Amortized		Fair		in the
December 31, 2017	Cost		Value		balance sheet
	(in thousands)
Fixed maturities:
Bonds:
U.S. government and government agencies and authorities	$	95,812	$	98,317	$	95,812
States, municipalities and political subdivisions		930,083		975,699		930,083
Foreign governments		85,583		93,431		85,583
All other corporate bonds [1]		6,292,980		6,597,042		6,306,311
Total fixed maturities		7,404,458		7,764,489		7,417,789
Equity securities:
Common stock:
Industrial, miscellaneous and all other		49,416		49,416		49,416
Nonredeemable preferred stock		124,890		130,561		124,890
Total equity securities		174,306		179,977		174,306
Mortgage loans		90,939		90,939		90,939
Real estate, at depreciated cost		30,916		XXX		30,916
Contract loans		2,337,222		XXX		2,337,222
Other invested assets [2]		611,662		613,610		611,112
Cash and short-term investments		356,007		356,007		356,007
Receivables for securities		6,999		XXX		6,999
Total cash and invested assets	$	11,012,509			$	11,025,290

____________________

[1]	Amortized cost and fair value amounts exclude $13,331 and $14,103, respectively, of related-party bonds.
[2]	Difference between amortized cost and amount on balance sheet relates to $550 of non-admitted other invested assets.

See accompanying independent auditors’ report.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Supplementary Insurance Information
For the years ended December 31, 2018 and 2017

	As of December 31,				For the years ended December 31,
	Future policy		Other
	benefits,		policy claims		Premium		Net		Benefits,		Other
	losses and		and benefits		and annuity		investment		claims and		operating
	claims		payable		considerations		income		losses		expenses
	(in thousands)
2018:
Insurance Segment	$	9,772,208	$	136,826		251,976	$	588,147	$	423,210	$	95,242

2017:
Insurance Segment	$	10,038,205	$	157,267	$	296,611	$	625,172	$	468,514	$	167,194

See accompanying independent auditors’ report.

Nassau Life Insurance Company
(a wholly owned subsidiary of The Nassau Companies of New York)
Supplementary Schedule - Reinsurance
For the years ended December 31, 2018 and 2017

									Percentage
	Gross		Reinsurance		Reinsurance		Net		of assumed
	amount		ceded		assumed		amount		to net
	(in thousands)
Life insurance in force:
2018	$	28,458,804	$	13,360,421	$	2,927,687	$	18,026,070	16%
2017		30,497,149		14,202,841		2,945,450		19,239,758	15%

Life insurance premiums:
2018	$	367,246	$	147,155	$	31,885	$	251,976	13%
2017		399,472		156,886		54,025		296,611	18%

See accompanying independent auditors’ report.

¹ Incorporated herein by reference to Post-Effective Amendment No. 23 to the Registration Statement on Form N-4 (File Nos. 002-66295; 811-02982) filed by the Registrant on May 19, 1997.

The following are the directors and officers of NNY. Unless otherwise noted, each director’s and officer’s principal business address is One American Row, Hartford, CT 06102.

Item 26. Persons Controlled by or Under Common Control with the Depositor or Registrant

The Registrant is a separate account of NNY, a stock life insurance company incorporated under the laws of the State of New York. NNY is an indirect subsidiary of Nassau Financial Group L.P. An organization chart of Nassau Financial Group L.P. is set forth below.

As of May 1, 2020, the number of owners of qualified and non-qualified contracts offered by the Registrant was 0 and 102, respectively.

To the full extent permitted by the laws of the State of New York, NNY shall indemnify any person made or threatened to be made a party to any action, proceeding or investigation, whether civil or criminal, by reason of the fact that such person, or such person’s testator or intestate:

against judgements, fines, amounts paid in settlement and reasonable expenses, including attorneys’ fees, actually and necessarily incurred in connection with or as a result of such action, proceeding or investigation, or any appeal therein.

Subject to applicable law, the indemnification provided in this Article VI shall not be deemed to be exclusive of any other rights to which a director, officer or employee of the company seeking indemnification may be entitled.

In addition, the directors and officers of the company are insured against certain liabilities arising out of their conduct in such capacities. The coverage is subject to certain terms and conditions and to the specified coverage limit set forth in the applicable policies.

Under the terms of the underwriting agreement between NNY and 1851 Securities, Inc., NNY will indemnify and hold harmless 1851 Securities, Inc. for any expenses, losses, claims, damages or liabilities (including attorney fees) incurred by reason of any material misrepresentation or omission in a registration statement or prospectus for a variable insurance product for which 1851 Securities, Inc. serves as principal underwriter; provided, however, NNY shall not be required to indemnify for any expenses, losses, claims, damages or liabilities which have resulted from the negligence, misconduct or wrongful act of 1851 Securities, Inc.

Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

The accounts, books and other documents required to be maintained pursuant to Section 31(a) of the Investment Company Act of 1940 and rules promulgated thereunder are maintained by NNY at Vital Records, 563 New Center Road, Flagtown, NJ 08821 (electronic record storage) and at Archive Systems, 25 Commerce Road, Fairfield, NJ 07004 (archive records).

NNY represents that the fees and charges deducted under the contracts described in this Registration Statement, in the aggregate, are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by NNY under the contracts.

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has caused this Registration Statement to be signed on its behalf, in the City of Hartford, and State of Connecticut on this 8th day of July, 2020.

As required by the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated:

Kostas Cheliotis	Dodie C. Kent, Esq.
Vice President, General Counsel, Secretary	Partner
Nassau Re	Eversheds Sutherland (US) LLP
One American Row	1114 Avenue of the Americas, 40th Floor
Hartford, Connecticut 06115	New York, New York 10036

I.	References to First Investors Life Insurance Company (including references to “we,” “us” and “our”) throughout the prospectus that are not otherwise addressed below are replaced with references to NNY. Please note that First Investors Life Insurance Company was renamed FLIAC in September 2015.

II.	References to the First Investors Special Bond Fund, Inc. (including references to the “Special Bond Fund”) throughout the prospectus that are not otherwise addressed below are replaced with references to the Delaware VIP^® Fund for Income Series (or the “Fund”).

III.	The following replaces the information related to total annual operating expenses of the Fund and the subsequent cost example on page 4 under “FEE TABLE.” Please note that the fees and expenses of the Contract have not changed as a result of the Merger, and the following information is being provided solely to update the total annual operating expenses of the Fund and to update the cost example.

Fund Operating Expenses
(as a percentage of Fund assets)¹
Management fees			0.65%
Distribution and service (12b-1) fees			None
Other expenses			0.18%
Total annual Fund operating expenses			0.83%
Fee waivers and expense reimbursements			(0.00)%²
Total annual Fund operating expenses after fee waivers and expense reimbursements			0.83%

¹Based on expenses incurred during the Fund’s fiscal year ended December 31, 2019.
^2.The Fund’s investment manager has contractually agreed to waive all or a portion of its investment advisory fees and/or pay/reimburse expenses (excluding any acquired fund fees and expenses, taxes, interest, short sale dividend and interest expenses, brokerage fees, certain insurance costs and nonroutine expenses or costs, including, but not limited to, those relating to reorganizations, litigation, conducting shareholder meetings and liquidations) in order to prevent total annual Fund operating expenses from exceeding 0.83% of the Fund’s average daily net assets from October 4, 2019 through October 31, 2021. These waivers and reimbursements may only be terminated by agreement of the investment manager and the Fund.

1 year		3 years		5 years		10 years
$849		$1,164		$1,500		$2,447

At	Accumulation Unit	Number of
	Value ($)	Accumulation Units
December 31, 2010	8.26	1,075,899
December 31, 2011	8.67	960,487
December 31, 2012	9.76	891,969
December 31, 2013	10.36	825,813
December 31, 2014	10.36	734,847
December 31, 2015	10.09	645,618
December 31, 2016	11.13	595,190
December 31, 2017	11.80	518,049
December 31, 2018	11.41	440,087
December 31, 2019	12.77	393,064

●	dividing your investment in the Contract by the total amount you expect to receive out of the Contract, and
●	multiplying the result by the amount of the payment.

●	a partial or total surrender is taxed in the year of receipt to the extent that the Contract’s Accumulated Value exceeds the investment in the Contract (that is, on an “income first” basis); and
●	a penalty equal to 10% of the taxable distribution applies to distributions before the taxpayer reaches age 59½ subject to certain exceptions.

●	made on or after the death of a Contractowner;
●	attributable to the taxpayer becoming disabled; or
●	made as part of a series of substantially equal periodic payments for the life or life expectancy of the taxpayer or for the joint life or joint life expectancy of the taxpayer and the spouse.

●	if distributed in a lump sum, it is taxed in the same manner as a surrender of the Contract;
●	if distributed under an annuity payout option, it is taxed in the same manner as annuity payments.

I.	References to First Investors Life Insurance Company throughout the SAI that are not otherwise addressed below are replaced with references to NNY. Please note that First Investors Life Insurance Company was renamed FLIAC in September 2015.

II.	On page 2, the following replaces the section titled “FIRST INVESTORS LIFE INSURANCE COMPANY” under “GENERAL DESCRIPTION”:

		Page
Report of Independent Registered Public Accounting Firm		1

Statement of Assets and Liabilities		2

Statement of Operations		3

Statements of Changes in Net Assets		4

Notes to Financial Statements		5

		Fund for
		Income
Assets:
Investments (note 3):
Number of shares		789,071
Cost	$	5,241,131
Net asset value	$	5,018,492

Liabilities:
Payable to Foresters Life Insurance
and Annuity Company		2,986

Net assets		5,015,506

Net assets represented by
contracts in accumulation period	$	5,015,506

Outstanding Units:
		393,064

Unit Value:
	$	12.774

		Fund for
		Income
Investment income:
Income:
Dividends	$	285,429

Expenses:
Mortality and expense risks (note 5)		36,346
Administrative charges (note 5)		—

Total expenses		36,346

Net investment income (loss)		249,083

Realized gain on investments:
Realized gain distributions		—
Realized gain (loss) on investments		(59,484	)

Realized gains (losses)		(59,484	)

Change in unrealized appreciation
(depreciation) on investments		386,279

Net increase (decrease) in net
assets resulting from operations	$	575,878

		Fund for Income
		2019			2018
Increase (decrease) in net assets:
From operations:
Net investment income (loss)	$	249,083		$	244,259
Realized gain distributions		—			—
Realized gain (loss) on investments		(59,484	)		(64,724	)
Change in unrealized appreciation (depreciation) on investments		386,279			(346,263	)
Net increase (decrease) in net assets resulting from operations		575,878			(166,728	)

From contract transactions:
Net insurance premiums from contract owners		—			—
Transfers between sub-accounts		—			—
Transfers for contract benefits and terminations		(595,203	)		(920,408	)

Increase (decrease) in net assets derived from
contract transactions		(595,203	)		(920,408	)

Net increase (decrease) in net assets		(19,325	)		(1,087,136	)

Net assets:
Beginning of year		5,034,831			6,121,967
End of year	$	5,015,506		$	5,034,831

(1)	Organization

	First Investors Life Variable Annuity Fund A (Separate Account A), a unit investment trust registered under the Investment Company Act of 1940 (the 1940 Act), is a segregated investment account established by Foresters Life Insurance and Annuity Company (FLIAC), formerly First Investors Life Insurance Company, and exists in accordance with the regulations of the New York State Department of Financial Services.

	Assets of Separate Account A have been used to purchase shares in diversified investment funds (Funds). Until October 4, 2019, assets of Separate Account A were used to purchase shares of First Investors Life Series Fund for Income, an open-end diversified management investment company registered under the 1940 Act. On October 4, 2019, each series of the First Investors Life Series Funds managed by Foresters Investment Management Company (FIMCO), an affiliate of FLIAC, reorganized into a substantially similar series of the Delaware VIP Trust, managed by Delaware Management Company, a series of Macquarie Investment Management Business Trust. On October 4, 2019 the Fund name was changed to Delaware Fund For Income.

	FLIAC offers a variable annuity contract through Separate Account A. New contracts are no longer available for sale; however, existing contract holders may continue to make additional payments under their contracts. In addition, contract holders are able to convert their contracts to a Tax Tamer I product offered through First Investors Life Variable Annuity Fund C. Tax Tamer I is no longer available for sale but it does offer more investment options for the contract holder. The contract holder bears the investment risk if the Fund does not meet its stated investment objectives.

(2)	Significant Accounting Policies

Registration Nos.	333-
	811-02982

	Net assets
				Investment
				income ratio	Expense ratio	Total return
	Units	Unit value ($)	($000s)	(%) ¹	(%) ²	(%) ³
Fund for Income:
December 31:
2019	393,064	12.774	5,016	6.75	0.75	11.94
2018	440,087	11.412	5,035	6.43	0.75	(3.31	)
2017	518,049	11.803	6,122	5.15	0.75	6.03
2016	595,190	11.132	6,636	5.64	0.75	10.29
2015	645,618	10.093	6,519	5.78	0.75	(2.58	)


	*(a)*	*Basis of Presentation*

		The financial statements of Separate Account A are presented in conformity with U.S. generally accepted accounting principles based on guidance in Accounting Standards Codification (ASC) 946 Financial Services – Investment Companies.

	*(b)*	*Use of Estimates*

		The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

	*(d)*	*Subsequent Events*

		Management has evaluated subsequent events from the balance sheet date through June 17, 2020, the date that the financial statements were available to be issued.

		The U.S. stock and bond markets have encountered significant volatility and the global economy experienced a downturn during the first quarter of 2020. The conditions directly and indirectly affect the companies in which the underlying Fund invests, which has impacted the valuation of the Fund. Although management cannot quantify the full impact these conditions will have on Separate Account A, to date Fund shares continue to be redeemed in the normal course of business at the current NAV.

	*(e)*	*Investments*

		Shares of the Fund held by Separate Account A are valued at net asset value (NAV) per share of the Fund, which values the underlying investment securities at fair value on a daily basis. The NAV is a Level 1 input within the FASB fair value hierarchy since there is a readily determinable market, there are no restrictions on the Fund’s redemption and sufficient transaction volumes exists. All distributions received from the Fund are reinvested to purchase additional shares of the Fund at net asset value. Investment transactions are accounted for on a trade date basis and average cost is the basis followed in determining the cost of investments sold for financial statement purposes.

	*(f)*	*Investment Income*

		Investment income consists of dividends declared by the Fund and is recognized on the ex-dividend date. Realized gains and losses are recorded on a trade date basis. Reinvested realized gain distributions are recorded when received. Average cost is used as the basis of investments held and sold. The change in the value of the Fund is recorded as unrealized appreciation or depreciation and is included in the accompanying statement of operations.

	*(g)*	*Federal Income Taxes*

		Separate Account A is not taxed separately because its operations are part of the total operations of FLIAC, which is taxed as a life insurance company under the Internal Revenue Code. Separate Account A is not taxed as a regulated investment company under Subchapter M of the Code. Under existing Federal income tax law, no taxes are payable on the investment income or on the capital gains of Separate Account A, accordingly no provision for federal income taxes has been made.

(3)	Investments

	At December 31, 2019, Separate Account A held 789,071 shares of the Fund at a NAV of $6.36, or a fair value of $5,018,492. The cost basis of the investment was $5,241,131. The cost of purchases totaled $285,429 and proceeds from sales totaled $631,599 for the year ended December 31, 2019.

(4)	Changes in Units

	The net decrease in units of 47,033 is comprised of 0 units issued and 47,033 units redeemed during 2019.

(5)	Mortality and Expense Risks and Deductions

	In consideration for its assumption of the mortality and expense risks connected with the Variable Annuity Contracts, FLIAC deducts an amount equal on an annual basis to 0.75% of the daily net asset value of the Fund. This deduction is assessed through a reduction of unit values. An additional administrative charge of $7.50 may be deducted annually by FLIAC from the Accumulated Value of Deferred Annuity Contracts, which have an Accumulated Value of less than $1,500 due to partial surrenders and would be assessed through a redemption of units. There was no deduction under this provision during 2019.

(6)	Financial Highlights

1.	These amounts represent the dividends, excluding distributions of capital gains, received by the sub-account from the underlying mutual fund, divided by the average net assets. These ratios exclude those expenses, such as mortality and expense charges, that are assessed against contract owner accounts either through reductions in unit values or redemption of units. The recognition of investment income by the sub-account is affected by the timing of the declaration of dividends by the underlying fund in which the sub-account invests.

2.	These amounts represent the annualized contract expenses of the separate account, consisting primarily of mortality and expense charges, for the periods indicated. These ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to contract owner accounts through redemption of units and expenses of the underlying fund have been excluded.

3.	These amounts represent the total return for the periods indicated, including changes in value of the underlying fund, and expenses assessed through the reduction of unit values. These ratios do not include any expenses assessed through the redemption of units.

(a)	Financial Statements. Financial statements of First Investors Life Variable Annuity Fund A (the “Registrant” or the “Separate Account”) as of December 31, 2019 and for each of the years in the two-year period then ended and the financial highlights for each of the years in the five-year period then ended, and financial statements of Nassau Life Insurance Company (the “Depositor” or “NNY”) as of December 31, 2019 and 2018, and as of December 31, 2018 and 2017, and for each of the years in each of the two-year periods ended December 31, 2019 and December 31, 2018, are included in Part B of the Registration Statement.

(b)	Exhibits

	(1)	Resolution of the Board of Directors of First Investors Life Insurance Company establishing the Separate Account.¹
	(2)	Not applicable.
	(3)	Underwriting and distribution contracts:
		(a)	Underwriting Agreement between First Investors Life Insurance Company, the Separate Account and First Investors Corporation.¹
		(b)	Specimen Variable Annuity Dealer Agreement between First Investors Corporation and dealers.¹
		(c)	Underwriting Agreement between Foresters Life Insurance and Annuity Company, the Separate Account and 1851 Securities, Inc., filed herewith.
		(d)	Broker-Dealer and General Agent Sales Agreement between Foresters Financial Services, Inc., Foresters Life Insurance and Annuity Company and Cetera Investment Services LLC, filed herewith.
	(4)	Specimen Individual Variable Annuity Contract issued by First Investors Life Insurance Company for participation in the Separate Account.¹
	(5)	Form of application used with the Individual Variable Annuity Contract provided in response to (4) above.¹
	(6)	Depositor instrument of organization and by-laws:
		(a)	Certificate of Incorporation of NNY, filed herewith.
		(b)	By-laws of NNY, filed herewith.
		(c)	Resolutions of the Board of Directors of NNY approving the merger of Foresters Life Insurance and Annuity Company with and into NNY, filed herewith.
	(7)	Not applicable.
	(8)	Material contracts:
		(a)	Fund Participation Agreement between Foresters Life Insurance and Annuity Company, the Separate Account and Delaware VIP® Trust (including Rule 22c-2 shareholder information agreement), filed herewith.
		(b)	Administrative Services Agreement between NNY (formerly Phoenix Life Insurance Company) and Nassau Companies of New York (formerly The Phoenix Companies, Inc.), filed herewith.
	(9)	Opinion and consent of counsel, filed herewith.
	(10)	Consents of Independent Registered Public Accounting Firm, filed herewith.
	(11)	Not applicable.
	(12)	Not applicable.
	(13)	Powers of attorney for Phillip Gass, Thomas Williams, David Monroe, Leanne Bell, Kevin Gregson, Michael Kalen and Leland Launer, filed herewith.

	Name		Positions and Offices with Depositor
	Phillip Gass		President, Chief Executive Officer and Director

	Thomas Buckingham		Vice President, Chief Product and Service Officer

	Kostas Cheliotis		Vice President, General Counsel, Secretary and Director

	David Czerniecki		Vice President, Chief Investment Officer

	Richard Daniel McCoach		Vice President, Chief Information Officer

	William Moorcroft		Chief Compliance Officer, Anti-Money Laundering Officer

	Justin Mosbo		Vice President, Chief Actuary

	Thomas Williams		Vice President, Chief Financial Officer and Director

	Leanne Bell		Director

	Kevin Gregson		Director

	Michael Kalen		Director

	Leland Launer		Director

(1)	is or was a director, officer or employees of the company; or

(2)	serves or served another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise in any capacity at the request of the company, and at the time of such services, was a director, officer or employee of the company

Name		Positions and Offices with Principal
		Underwriter
William Moorcroft		Chief Executive Officer, Chief Compliance Officer and Director

Peter Hosner Jr.*		Chief Financial Officer

Walter Costenbader		Financial and Operations Principal (FinOP)

Thomas Buckingham		Director

Susan Guazzelli		Director

Hayley Maldonado		Director

*Business address is 15 Tech Valley Drive, East Greenbush, New York 12061.

(1) Name of Principal	(2) Net Underwriting	(3) Compensation on	(4) Brokerage	(5) Other
Underwriter	Discounts and Commissions	Redemption	Commissions	Compensation
Foresters Financial Services, Inc.	None	None	None	None

(a)	An undertaking to file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements in the registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted;

(b)	An undertaking to include either: (1) as part of any application to purchase a contract offered by the prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a postcard or similar written communication affixed to or included in the prospectus that the applicant can remove to send for a Statement of Additional Information; and

(c)	An undertaking to deliver any Statement of Additional Information and any financial statements required to be made available under this Form promptly upon written or oral request.

FIRST INVESTORS LIFE VARIABLE ANNUITY FUND A
(Registrant)

By:	/s/ Phillip Gass
Phillip Gass*
President and Chief Executive Officer
Nassau Life Insurance Company

NASSAU LIFE INSURANCE COMPANY
(Depositor)

By:	/s/ Phillip Gass
Phillip Gass*
President and Chief Executive Officer
Nassau Life Insurance Company

Signature	Title	Date
/s/ Phillip Gass	President, Chief Executive Officer	July 8, 2020
Phillip Gass*	and Director

/s/ Thomas Williams	Chief Financial Officer and	July 8, 2020
Thomas Williams*	Director

/s/ David Monroe	Chief Accounting Officer	July 8, 2020
David Monroe*

/s/ Leanne Bell	Director	July 8, 2020
Leanne Bell*

/s/ Kevin Gregson	Director	July 8, 2020
Kevin Gregson*

/s/ Michael Kalen	Director	July 8, 2020
Michael Kalen*

/s/ Leland Launer	Director	July 8, 2020
Leland Launer*

*By:	/s/ Kostas Cheliotis
	Kostas Cheliotis (Attorney-in-Fact pursuant to powers of attorney filed herewith)
	Date: July 8, 2020

Exhibit Number		Description
3(c)		Underwriting Agreement between Foresters Life Insurance and Annuity Company, the Separate Account and 1851 Securities, Inc.

3(d)		Broker-Dealer and General Agent Sales Agreement between Foresters Financial Services, Inc., Foresters Life Insurance and Annuity Company and Cetera Investment Services LLC

6(a)		Certificate of Incorporation of NNY

6(b)		By-laws of NNY

6(c)		Resolutions of the Board of Directors of NNY approving the merger of Foresters Life Insurance and Annuity Company with and into NNY

8(a)		Fund Participation Agreement between Foresters Life Insurance and Annuity Company, the Separate Account and Delaware VIP® Trust (including Rule 22c-2 shareholder information agreement)

8(b)		Administrative Services Agreement between NNY (formerly Phoenix Life Insurance Company) and Nassau Companies of New York (formerly The Phoenix Companies, Inc.)

9		Opinion and consent of counsel

10		Consents of Independent Registered Public Accounting Firm

13		Powers of attorney for Phillip Gass, Thomas Williams, David Monroe, Leanne Bell, Kevin Gregson, Michael Kalen and Leland Launer