Level 3 (Tables)

3 Months Ended

Mar. 31, 2019

Investments [Abstract]

Net Realized Capital Gains (Losses)

Net Realized Capital Gains (Losses)
	Successor Company			Predecessor Company
(Before tax)	For the three months ended March 31, 2019			For the three months ended March 31, 2018
Gross gains on sales	$	13		$	21
Gross losses on sales	(8		)	(17		)
Equity securities [1]	2			11
Results of variable annuity hedge program
GMWB derivatives, net	14			4
Macro hedge program	(226		)	18
Total results of variable annuity hedge program	(212		)	22
Transactional foreign currency revaluation	—			(14		)
Non-qualifying foreign currency derivatives	(4		)	17
Other, net [2]	16			(19		)
Net realized capital gains (losses)	$	(193	)	$	21

[1] Includes all changes in fair value and trading gains and losses for equity securities at fair value.

[2]

Includes gains (losses) on non-qualifying derivatives, excluding foreign currency derivatives, of $12 and $(5) for the three months ended March 31, 2019 (Successor Company) and 2018 (Predecessor Company), respectively.

Impairments

Cumulative Credit Impairments
	Successor Company			Predecessor Company
(Before tax)	For the three months ended March 31, 2019			For the three months ended March 31, 2018
Balance as of beginning of period	$	(6	)	$	(88	)
Additions for credit impairments recognized on [1]:
Securities not previously impaired	—			—
Securities previously impaired	—			—
Reductions for credit impairments previously recognized on:
Securities that matured or were sold during the period	6			4
Balance as of end of period	$	—		$	(84	)

[1]

These additions are included in the net OTTI losses recognized in earnings in the Condensed Consolidated Statements of Operations.

Schedule of Available-for-sale Securities

Available-for-Sale Securities

AFS Securities by Type
	Successor Company
	March 31, 2019											December 31, 2018
	Cost or Amortized Cost [1]		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-Credit OTTI [2]		Cost or Amortized Cost [1]		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-Credit OTTI [2]
ABS	$	380	$	3	$	—		$	383	$	—	$	514	$	2	$	—		$	516	$	—
CLOs	996		9		(8		)	997		—		971		5		(13		)	963		—
CMBS	1,453		32		(1		)	1,481		—		1,409		8		(7		)	1,407		—
Corporate	7,855		183		(51		)	8,020		—		7,860		19		(236		)	7,678		(1		)
Foreign govt./govt. agencies	380		14		(1		)	390		—		383		3		(6		)	377		—
Municipal	710		21		—			732		—		738		5		(10		)	734		—
RMBS	980		7		(1		)	986		—		1,034		3		(4		)	1,033		—
U.S. Treasuries	957		31		—			988		—		1,126		8		(3		)	1,131		—
Total fixed maturities, AFS	$	13,711	$	300	$	(62	)	$	13,977	$	—	$	14,035	$	53	$	(279	)	$	13,839	$	(1	)

[1] The cost or amortized cost of assets that support modified coinsurance reinsurance contracts were not adjusted as part of the application of pushdown accounting. As a result, gross unrealized gains (losses) only include subsequent changes in value recorded in AOCI beginning June 1, 2018. Prior changes in value have been recorded in additional paid-in capital.

[2] Represents the amount of cumulative non-credit OTTI losses recognized in OCI on securities that also had credit impairments. These losses are included in gross unrealized losses as of March 31, 2019 (Successor Company) and December 31, 2018 (Successor Company).

Fixed maturities, AFS, by Contractual Maturity Year
	Successor Company
	March 31, 2019				December 31, 2018
Contractual Maturity	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	430	$	429	$	481	$	479
Over one year through five years	1,419		1,433		1,508		1,501
Over five years through ten years	1,885		1,926		1,807		1,783
Over ten years	6,168		6,342		6,311		6,157
Subtotal	9,902		10,130		10,107		9,920
Mortgage-backed and asset-backed securities	3,809		3,847		3,928		3,919
Total fixed maturities, AFS	$	13,711	$	13,977	$	14,035	$	13,839

Investments by Contractual Maturity Year

Fixed maturities, AFS, by Contractual Maturity Year
	Successor Company
	March 31, 2019				December 31, 2018
Contractual Maturity	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	430	$	429	$	481	$	479
Over one year through five years	1,419		1,433		1,508		1,501
Over five years through ten years	1,885		1,926		1,807		1,783
Over ten years	6,168		6,342		6,311		6,157
Subtotal	9,902		10,130		10,107		9,920
Mortgage-backed and asset-backed securities	3,809		3,847		3,928		3,919
Total fixed maturities, AFS	$	13,711	$	13,977	$	14,035	$	13,839

Estimated maturities may differ from contractual maturities due to security call or prepayment provisions. Due to the potential for variability in payment speeds (i.e. prepayments or extensions), mortgage-backed and asset-backed securities are not categorized by contractual maturity.

Unrealized Loss on Investments

Unrealized Losses on AFS Securities

Unrealized Loss Aging for AFS Securities by Type and Length of Time as of March 31, 2019
Successor Company
	Less Than 12 Months							12 Months or More						Total
	Amortized Cost [1]		Fair Value		Unrealized Losses			Amortized Cost [1]		Fair Value		Unrealized Losses		Amortized Cost [1]		Fair Value		Unrealized Losses
ABS	$	102	$	102	$	—		$	—	$	—	$	—	$	102	$	102	$	—
CLOs	885		877		(8		)	—		—		—		885		877		(8		)
CMBS	217		216		(1		)	—		—		—		217		216		(1		)
Corporate	1,634		1,596		(51		)	—		—		—		1,634		1,596		(51		)
Foreign govt./govt. agencies	72		71		(1		)	—		—		—		72		71		(1		)
Municipal	31		31		—			—		—		—		31		31		—
RMBS	297		296		(1		)	—		—		—		297		296		(1		)
U.S. Treasuries	15		15		—			—		—		—		15		15		—
Total fixed maturities, AFS in an unrealized loss position	$	3,253	$	3,204	$	(62	)	$	—	$	—	$	—	$	3,253	$	3,204	$	(62	)

Unrealized Loss Aging for AFS Securities by Type and Length of Time as of December 31, 2018
Successor Company
	Less Than 12 Months							12 Months or More						Total
	Amortized Cost [1]		Fair Value		Unrealized Losses			Amortized Cost [1]		Fair Value		Unrealized Losses		Amortized Cost [1]		Fair Value		Unrealized Losses
ABS	$	179	$	179	$	—		$	—	$	—	$	—	$	179	$	179	$	—
CLOs	887		874		(13		)	—		—		—		887		874		(13		)
CMBS	762		754		(7		)	—		—		—		762		754		(7		)
Corporate	6,748		6,549		(236		)	—		—		—		6,748		6,549		(236		)
Foreign govt./govt. agencies	218		212		(6		)	—		—		—		218		212		(6		)
Municipal	490		480		(10		)	—		—		—		490		480		(10		)
RMBS	727		723		(4		)	—		—		—		727		723		(4		)
U.S. Treasuries	619		616		(3		)	—		—		—		619		616		(3		)
Total fixed maturities, AFS in an unrealized loss position	$	10,630	$	10,387	$	(279	)	$	—	$	—	$	—	$	10,630	$	10,387	$	(279	)

[1]

The cost or amortized cost of assets that support modified coinsurance reinsurance contracts were not adjusted as part of the application of pushdown accounting. As a result, gross unrealized gains (losses) only include subsequent changes in value recorded in AOCI beginning June 1, 2018. Prior changes in value have been recorded in additional paid-in capital.

Valuation Allowance Activity

Valuation Allowance Activity
	Successor Company			Predecessor Company
	For the three months ended March 31, 2019			For the three months ended March 31, 2018
Beginning Balance	$	(5	)	$	—
Reversals	—			—
Deductions	5			—
Ending Balance	$	—		$	—

Loans Credit Quality

Mortgage Loans Credit Quality
	Successor Company
	March 31, 2019			December 31, 2018
Loan-to-value	Carrying Value		Avg. Debt-Service Coverage Ratio	Carrying Value		Avg. Debt-Service Coverage Ratio
65% - 80%	358		1.88x	340		1.78x
Less than 65%	1,727		2.52x	1,760		2.48x
Total mortgage loans	$	2,085	2.41x	$	2,100	2.36x

Mortgage Loans

Mortgage Loans by Region
	Successor Company
	March 31, 2019			December 31, 2018
	Carrying Value		Percent of Total	Carrying Value		Percent of Total
East North Central	$	56	2.7%	$	56	2.7%
East South Central	19		0.9%	19		0.9%
Middle Atlantic	131		6.3%	131		6.2%
Mountain	51		2.4%	51		2.4%
New England	79		3.8%	79		3.7%
Pacific	679		32.6%	684		32.6%
South Atlantic	451		21.6%	457		21.8%
West South Central	225		10.8%	226		10.8%
Other [1]	394		18.9%	397		18.9%
Total mortgage loans	$	2,085	100%	$	2,100	100%

[1] Primarily represents loans collateralized by multiple properties in various regions.

Mortgage Loans by Property Type
	Successor Company
	March 31, 2019			December 31, 2018
	Carrying Value		Percent of Total	Carrying Value		Percent of Total
Commercial
Industrial	$	585	28.1%	$	580	27.6%
Lodging	24		1.2%	24		1.1%
Multifamily	519		24.9%	518		24.7%
Office	459		22.0%	478		22.8%
Retail	284		13.6%	286		13.6%
Single Family	86		4.1%	86		4.1%
Other	128		6.1%	128		6.1%
Total mortgage loans	$	2,085	100%	$	2,100	100%

Offsetting Liabilities

Securities Lending and Repurchase Agreements
	Successor Company
	March 31, 2019		December 31, 2018
	Fair Value		Fair Value
Securities Lending Transactions:
Gross amount of securities on loan	$	297	$	277
Gross amount of associated liability for collateral received [1]	$	304	$	284
Repurchase agreements:
Gross amount of recognized liabilities for repurchase agreements	$	195	$	186
Gross amount of collateral pledged related to repurchase agreements [2]	$	197	$	190
Gross amount of recognized receivables for reverse repurchase agreements [3]	$	35	$	25

[1] Cash collateral received is reinvested in fixed maturities, AFS and short term investments which are included in the Condensed Consolidated Balance Sheets. Amount includes additional securities collateral received of $5 and $1 which are excluded from the Company's Condensed Consolidated Balance Sheets as of March 31, 2019 (Successor Company) and December 31, 2018 (Successor Company), respectively.

[2] Collateral pledged is included within fixed maturities, AFS and short term investments in the Company's Condensed Consolidated Balance Sheets.

[3]

Collateral received is included within short term investments in the Company's Condensed Consolidated Balance Sheets.

Offsetting Derivative Assets and Liabilities (Successor Company)
	(i)			(ii)			(iii) = (i) - (ii)						(iv)				(v) = (iii) - (iv)
							Net Amounts Presented in the Statement of Financial Position							Collateral Disallowed for Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets (Liabilities)			Gross Amounts Offset in the Statement of Financial Position			Derivative Assets [1] (Liabilities) [2]			Accrued Interest and Cash Collateral Received [3] Pledged [2]				Financial Collateral Received [4]			Net Amount
As of March 31, 2019
Other investments	$	253		$	214		$	127		$	(88	)		$	11		$	28
Other liabilities	$	(366	)	$	(66	)	$	(240	)	$	(60	)		$	(298	)	$	(2	)
As of December 31, 2018
Other investments	$	455		$	352		$	212		$	(109	)		$	65		$	38
Other liabilities	$	(327	)	$	(147	)	$	(84	)	$	(96	)		$	(178	)	$	(2	)

[1] Included in other invested assets in the Company's Condensed Consolidated Balance Sheets.

[2] Included in other liabilities in the Company's Condensed Consolidated Balance Sheets and is limited to the net derivative receivable associated with each counterparty.

[3] Included in other investments in the Company's Condensed Consolidated Balance Sheets and is limited to the net derivative payable associated with each counterparty.

[4]

Excludes collateral associated with exchange-traded derivative instruments.