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Investments
 12 Months Ended
Dec. 31, 2023
Investments [Abstract]  
Investments Investments
Available-for-Sale Debt Securities
The following table presents the balances of AFS debt securities, by major security type:
Amortized Cost
Allowance for Credit Losses
Gross Unrealized GainsGross Unrealized LossesFair Value
As of December 31, 2023 (Successor Company)
Fixed maturities, available-for-sale
Asset-backed securities
$376 $— $3 $(16)$363 
Collateralized loan obligations
970 (2)3 (5)966 
Commercial mortgage-backed securities
1,639 (7)— (186)1,446 
Corporate bonds
11,245 (7)22 (1,715)9,545 
Foreign government and agencies
442 — 10 (48)404 
Municipal bonds
961 — — (158)803 
Residential mortgage-backed securities
508 — — (63)445 
U.S. Treasury bonds
1,194 — — (312)882 
Total fixed maturities, available-for-sale
$17,335 $(16)$38 $(2,503)$14,854 
Short-term investments, available-for-sale
$28 — — — $28 
As of December 31, 2022 (Successor Company)
Fixed maturities, available-for-sale
Asset-backed securities
$276 $— $— $(22)$254 
Collateralized loan obligations
703 — — (27)676 
Commercial mortgage-backed securities
1,724 — 1 (211)1,514 
Corporate bonds
12,565 — 2 (2,326)10,241 
Foreign government and agencies
377 — — (62)315 
Municipal bonds
1,309 — — (269)1,040 
Residential mortgage-backed securities
503 — — (86)417 
U.S. Treasury bonds
1,232 — — (306)926 
Total fixed maturities, available-for-sale
$18,689 $— $3 $(3,309)$15,383 

The following table presents the balances of AFS debt securities, by contractual maturity:
Successor Company
As of December 31, 2023As of December 31, 2022
Amortized Cost
Fair
Value
Amortized Cost
Fair
Value
One year or less
$392 $378 $445 $437 
Over one year through five years2,305 2,178 2,392 2,214 
Over five years through ten years3,351 2,960 4,438 3,732 
Over ten years7,822 6,144 8,209 6,140 
Structured securities
3,493 3,222 3,205 2,860 
Total
$17,363 $14,882 $18,689 $15,383 

Estimated maturities may differ from contractual maturities due to call or prepayment provisions. Due to the potential for variability in payment speeds (i.e., prepayments or extensions).
The following tables present the Company’s unrealized loss aging for AFS debt securities, by major security type and length of time that the securities were in a continuous unrealized loss position:
Less Than 12 Months12 Months or MoreTotal
Fair
Value		Unrealized
Losses		Fair
Value		Unrealized
Losses		Fair
Value		Unrealized
Losses
As of December 31, 2023 (Successor Company)
Fixed maturities, available-for-sale
Asset-backed securities
$75 $(2)$181 $(14)$256 $(16)
Collateralized loan obligations
238 (1)296 (4)534 (5)
Commercial mortgage-backed securities
43 (4)1,373 (182)1,416 (186)
Corporate bonds
376 (32)8,299 (1,683)8,675 (1,715)
Foreign government and agencies
1 — 290 (48)291 (48)
Municipal bonds
8 (1)794 (157)802 (158)
Residential mortgage-backed securities
— — 408 (63)408 (63)
U.S. Treasury bonds
6 (4)870 (308)876 (312)
Total fixed maturities, available-for-sale
$747 $(44)$12,511 $(2,459)$13,258 $(2,503)
As of December 31, 2022 (Successor Company)
Fixed maturities, available-for-sale
Asset-backed securities
$96 $(5)$162 $(17)$258 $(22)
Collateralized loan obligations
644 (27)11 — 655 (27)
Commercial mortgage-backed securities
819 (102)682 (109)1,501 (211)
Corporate bonds
6,659 (1,544)3,412 (782)10,071 (2,326)
Foreign government and agencies
185 (41)128 (21)313 (62)
Municipal bonds
859 (219)180 (50)1,039 (269)
Residential mortgage-backed securities
123 (20)293 (66)416 (86)
U.S. Treasury bonds
864 (293)63 (13)927 (306)
Total fixed maturities, available-for-sale
$10,249 $(2,251)$4,931 $(1,058)$15,180 $(3,309)

As of December 31, 2023, fixed maturities, AFS in an unrealized loss position consisted of 3,643 instruments and were primarily depressed due to increasing interest rates and/or widening credit spreads since the purchase and/or application of pushdown accounting dates. As of December 31, 2023, 67% of these fixed maturities were depressed less than 20% of cost or amortized cost.
The Company neither has an intention to sell nor does it expect to be required to sell the fixed maturities. The decision to record credit losses on fixed maturities, AFS in the form of an ACL requires us to make qualitative and quantitative estimates of expected future cash flows. Actual cash flows could deviate significantly from our expectations resulting in realized losses in future periods.
Sales
Sales of AFS debt securities in 2023 were primarily a result of strategic asset allocations, tactical changes to the portfolio driven by changing market conditions, and duration and liquidity management. Proceeds from sales of AFS debt securities were $1,304 for the year ended December 31, 2023 (Successor Company), $5,897 for the year ended December 31, 2022 (Successor Company), $2,372 for the period of December 31, 2021 (Successor Company) and $1,007 for the six months ended June 30, 2021 (Predecessor Company).
Allowance for Credit Losses
Developing the Company’s best estimate of expected future cash flows for ACL on AFS debt securities is a quantitative and qualitative process that incorporates information received from third-party sources along with certain internal assumptions regarding the future performance. Cash flows are discounted at the effective yield that is used to record interest income. The Company's considerations include, but are not limited to (a) changes in the financial condition of the issuer and/or the underlying collateral, (b) whether the issuer is current on contractually obligated interest and principal payments, (c) credit
ratings, (d) payment structure of the security and (e) the extent to which the fair value has been less than the amortized cost of the security.
For non-structured securities, assumptions include, but are not limited to: economic and industry-specific trends and fundamentals, instrument-specific developments including changes in credit ratings, industry earnings multiples and the issuer’s ability to restructure, access capital markets, and execute asset sales.
For structured securities, assumptions include, but are not limited to, various performance indicators such as historical and projected default and recovery rates, credit ratings, current and projected delinquency rates, loan-to-value ratios ("LTV"), average cumulative collateral loss rates that vary by vintage year, prepayment speeds, and property value declines. These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries which may include estimating the underlying collateral value.
The following presents a rollforward of the ACL for AFS debt securities, by major security type:
Collateralized Loan Obligations
Commercial Mortgage-Backed Securities
Corporate Bonds
Total
Balance as of January 1, 2022 (Successor Company)
$— $— $— $— 
Initial credit losses
— — 1 1 
Write-offs
— — (1)(1)
Balance as of December 31, 2022 (Successor Company) [1]
— — — — 
Initial credit losses
2 7 8 17 
Reduction for sales
— — (1)(1)
Balance at December 31, 2023 (Successor Company)[1]
$2 $7 $7 $16 
[1]As of December 31, 2023 and 2022 (Successor Company), the Company held no PCD AFS debt securities.

Net Investment Income
Net investment income by asset class consists of the following:
Successor CompanyPredecessor Company
For the Years Ended December 31,For the Period of July 1, 2021 to December 31, 2021For the Six Months Ended June 30, 2021
20232022
Fixed maturities [1]
$695 $620 $174 $243 
Equity securities
11 10 10 2 
Mortgage loans
80 74 32 45 
Policy loans
90 82 36 40 
Investment funds
116 168 259 216 
Other investments [2]
(381)(146)1 1 
Investment expense
(21)(30)(14)(13)
Total net investment income$590 $778 $498 $534 
[1]    Includes net investment income on short-term investments and excludes amounts related to fixed maturities where the FVO was elected.
[2]    Includes income from derivatives that qualify for hedge accounting and hedge fixed maturities along with income on assets from the COLI block of business. Includes the accretion using a risk-free rate on the book value of investment portfolios of modified coinsurance arrangements
Investment and Derivative Related Losses, Net
Investment and derivative related losses, net by asset class consists of the following:
Successor CompanyPredecessor Company
For the Years Ended December 31,For the Period of July 1, 2021 to December 31, 2021For the Six Months Ended June 30, 2021
20232022
Available-for-sale debt securities
Gross gains on sales1 2 14 55 
Gross losses on sales(194)(532)(20)(8)
Net realized gain/loss on other disposals(12)— — — 
Net realized investment related gains (losses) on available-for-sale debt securities
$(205)$(530)$(6)$47 
Provision for credit losses on fixed maturities, available-for-sale
(16)(1)— — 
Net recognized investment related losses on fair value option fixed maturities(11)(21)— — 
Net realized investment related gains (losses) on equity securities
12 5 19 — 
Net unrealized investment related gains (losses) on equity securities still held at the end of the period
(8)(24)(3)— 
Provision for credit losses on mortgage loans
(11)(3)— 6 
Net recognized investment related gains on fair value option investment funds41 16 — — 
Embedded derivatives [1]
198 1,014 15 80 
Freestanding derivatives [1]
(926)(297)(73)(379)
Fixed indexed annuities hedge program
22 (247)— — 
Other, net(25)12 (2)4 
Investment and derivative related losses, net
$(929)$(76)$(50)$(242)
[1]     Refer to the Non-Qualifying Derivatives section of Note 4 - Derivatives for additional information.
Accrued Interest Receivable
Accrued interest receivable recorded in other assets on the balance sheets consists of the following, by asset class:
Successor Company
As of December 31,
20232022
Available-for-sale debt securities
$161 $182 
Mortgage loans
6 8 

Mortgage Loans
The following table presents the Company’s mortgage loans, by geographic location:
Successor Company
December 31, 2023December 31, 2022
Amortized
Cost
Percent of Total
Amortized
Cost
Percent of Total
East North Central$87 4.3 %$74 2.9 %
East South Central34 1.7 %32 1.3 %
Middle Atlantic175 8.6 %194 7.7 %
Mountain176 8.6 %185 7.3 %
New England70 3.4 %82 3.2 %
Pacific462 22.6 %535 21.1 %
South Atlantic621 30.3 %694 27.4 %
West North Central40 1.9 %— — %
West South Central213 10.4 %180 7.1 %
Other [1]
167 8.2 %559 22.0 %
Total mortgage loans$2,045 100 %$2,535 100 %
[1]    Primarily represents loans collateralized by multiple properties in various regions.
The following table presents the Company’s mortgage loans, by property type:
Successor Company
December 31, 2023December 31, 2022
Amortized
Cost
Percent of Total
Amortized
Cost
Percent of Total
Commercial
Industrial$711 34.8 %$787 31.0 %
Multifamily617 30.2 %669 26.4 %
Office340 16.6 %383 15.1 %
Retail377 18.4 %443 17.5 %
Single Family— — %253 10.0 %
Total mortgage loans$2,045 100 %$2,535 100 %

Allowance for Credit Losses
The Company reviews mortgage loans on a quarterly basis to estimate the ACL, with changes in the ACL recorded in investment and derivative related losses, net. Apart from an ACL recorded on individual mortgage loans where the borrower is experiencing financial difficulties, the Company records an ACL on the pool of mortgage loans based on lifetime expected credit losses. The Company utilizes a third-party forecasting model to estimate lifetime expected credit losses at a loan level under multiple economic scenarios. The scenarios use macroeconomic data provided by an internationally
recognized economics firm that generates forecasts of varying economic factors such as GDP growth, unemployment and interest rates. The economic scenarios are projected over 10 years. The first two years to four years of the 10-year period assume a specific modeled economic scenario (including moderate upside, moderate recession and severe recession scenarios) and then revert to historical long-term assumptions over the remaining period. Using these economic scenarios, the forecasting model projects property-specific operating income and capitalization rates used to estimate the value of a future operating income stream. The operating income and the property valuations derived from capitalization rates are compared to loan payment and principal amounts to create debt-service coverage ratios ("DSCRs") and LTVs over the forecast period. The Company's process also considers qualitative factors. The model overlays historical data about mortgage loan performance based on DSCRs and LTVs and projects the probability of default, amount of loss given a default and resulting expected loss through maturity for each loan under each economic scenario. Economic scenarios are probability-weighted based on a statistical analysis of the forecasted economic factors and qualitative analysis. The Company records the change in the ACL on mortgage loans based on the weighted-average expected credit losses across the selected economic scenarios. When a borrower is experiencing financial difficulty, including when foreclosure is probable, the Company measures an ACL on individual mortgage loans. The ACL is established for any shortfall between the amortized cost of the loan and the fair value of the collateral less costs to sell. Estimates of collectibility from an individual borrower require the use of significant management judgment and include the probability and timing of borrower default and loss severity estimates. In addition, cash flow projections may change based upon new information about the borrower's ability to pay and/or the value of underlying collateral such as changes in projected property value estimates. As of December 31, 2023 and 2022 (Successor Company), the Company did not have any mortgage loans for which an ACL was established on an individual basis.
There were no mortgage loans held-for-sale as of December 31, 2023 and 2022 (Successor Company). In addition, as of December 31, 2023 and 2022 (Successor Company), the Company had no mortgage loans that have had extensions or restructurings other than what is allowable under the original terms of the contract. As of December 31, 2023 and 2022 (Successor Company), the Company held no PCD mortgage loans.
The following table presents a rollforward of the ACL for mortgage loans:

Successor CompanyPredecessor Company
For the Years Ended December 31,For the Period of July 1, 2021 to December 31, 2021For the Six Months Ended June 30, 2021
20232022
Beginning balance$15 $12 $— $17 
Cumulative effect of pushdown accounting— — 12 — 
Adjusted beginning balance ACL15 12 12 17 
Current-period provision11 3 — (6)
Ending balance$26 $15 $12 $11 

The increase in the allowance for the year ended December 31, 2023 (Successor Company) was primarily attributable to changes in market conditions and an update in assumptions. The increase in the allowance for the year ended December 31, 2022 (Successor Company) was primarily attributable to the deteriorating economic conditions and the potential impact on real estate property valuations and, to a lesser extent, net additions of new loans. The increase in the allowance for the period of July 1, 2021 to December 31, 2021 (Successor Company) was the result of pushdown accounting. The decrease in the allowance for the six months ended June 30, 2021 (Predecessor Company), is the result of improved economic scenarios, including improved GDP growth and unemployment, and higher property valuations as compared to the prior periods.
Credit Quality Indicators
The weighted-average LTV ratio at origination of the Company’s mortgage loans held as of December 31, 2023 (Successor Company) was 60%. LTV ratios compare the loan amount to the value of the underlying property collateralizing the loan with property values based on appraisals performed at origination. Factors considered in estimating property values include, among other things, actual and expected property cash flows, geographic market data and the ratio of the
property's net operating income to its value. DSCR compares a property’s net operating income to the borrower’s principal and interest payments which are updated no less than annually through reviews of underlying properties.
The following represents the LTV ratio and DSCR for mortgage loans, by origination year:
As of December 31, 2023 (Successor Company)
20232022202120202019
Prior
Total
Amortized cost for loan-to-values:
Greater than 80%
$— $56 $16 $— $— $48 $120 
65% to 80%
— 81 137 23 27 175 443 
Less than 65%
19 235 198 49 165 816 1,482 
Total
19 372 351 72 192 1,039 2,045 
Amortized cost for debt-service coverage ratios:
Greater than 1.50x
— 239 301 72 171 952 1,735 
1.15x to 1.50x
3 50 29 — 13 87 182 
0.95x to 1.15x
16 19 16 — 8 — 59 
Less than 0.95x
— 64 5 — — — 69 
Total
19 372 351 72 192 1,039 2,045 
Average loan-to-value for debt-service coverage ratios:
Greater than 1.50x
— %54.3 %58.6 %55.9 %54.2 %49.4 %52.4 %
1.15x to 1.50x
51.6 %38.6 %62.2 %— %69.5 %61.5 %55.7 %
0.95x to 1.15x
39.8 %77.5 %84.3 %— %76.9 %— %68.8 %
Less than 0.95x
— %77.1 %50.3 %— %— %— %75.2 %
Weighted average
42.7 %57.4 %59.7 %56.2 %56.3 %50.4 %54.0 %

As of December 31, 2022 (Successor Company)
20222021202020192018
Prior
Total
Amortized cost for loan-to-values:
Greater than 80%
$54 $— $— $— $— $41 $95 
65% to 80%
10 21 14 27 116 60 248 
Less than 65%
461 379 166 220 181 785 2,192 
Total
525 400 180 247 297 886 2,535 
Amortized cost for debt-service coverage ratios:
Greater than 1.50x
229 372 175 225 181 762 1,944 
1.15x to 1.50x
27 28 — 14 74 122 265 
0.95x to 1.15x
16 — — 8 42 — 66 
Less than 0.95x
— — 5 — — 2 7 
Not applicable [1]
253 — — — — — 253 
Total
525 400 180 247 297 886 2,535 
Weighted average loan-to-value for debt-service coverage ratios:
Greater than 1.50x
51.1 %53.9 %34.4 %45.1 %51.7 %51.3 %49.6 %
1.15x to 1.50x
29.2 %55.6 %— %65.0 %65.4 %52.0 %54.4 %
0.95x to 1.15x
50.1 %— %— %72.8 %71.7 %— %66.7 %
Less than 0.95x
— %— %50.0 %— %— %47.3 %50.8 %
Not applicable [1]
60.9 %— %— %— %— %— %60.9 %
Weighted average
54.6 %54.0 %34.8 %47.1 %57.9 %51.4 %51.7 %
[1]Represents certain construction and other mortgage loans in which rent is not collected.
Past-Due Mortgage Loans
Mortgage loans are considered past due if a payment of principal or interest is not received according to the contractual terms of the loan agreement, which typically includes a grace period. As of December 31, 2023 and 2022 (Successor Company), the Company held no mortgage loans considered past due.
Repurchase Agreements and Other Collateral Transactions
The Company enters into securities financing transactions as a way to earn additional income or manage liquidity, primarily through repurchase agreements.
Repurchase Agreements
From time to time, the Company enters into repurchase agreements to manage liquidity or to earn incremental income. A repurchase agreement is a transaction in which one party (transferor) agrees to sell securities to another party (transferee) in return for cash (or securities), with a simultaneous agreement to repurchase the same securities at a specified price at a later date. The maturity of these transactions is generally of ninety days or less. Repurchase agreements include master netting provisions that provide both parties the right to offset claims and apply securities held by them with respect to their obligations in the event of a default. Although the Company has the contractual right to offset claims, the Company's current positions do not meet the specific conditions for net presentation.
Under repurchase agreements, the Company transfers collateral of U.S. government and government agency securities and receives cash. For repurchase agreements, the Company obtains cash in an amount equal to at least 95% of the fair value of the securities transferred. The agreements require additional collateral to be transferred under specified conditions and provide the counterparty the right to sell or re-pledge the securities transferred. The cash received from the repurchase program is typically invested in short-term investments or fixed maturities and is reported as an asset on the Company's balance sheets. The Company accounts for the repurchase agreements as collateralized borrowings. The securities transferred under repurchase agreements are included in fixed maturities, AFS with the obligation to repurchase those securities recorded in other liabilities on the Company's balance sheets. As noted above, the Company’s current positions do not permit net presentation, however, the following presents the potential effect of rights of setoff associated with repurchase agreements:
Successor Company
As of December 31,
20232022
Gross amounts recognized
$(421)$(564)
Gross amounts not offset:
Financial instruments [1]
439 577 
Net amount
$18 $13 
[1]Included within fixed maturities and short-term investments on the Company's balance sheets.
Refer to Note 4 - Derivatives the potential effect of rights of set-off associated with recognized derivative assets and liabilities.
Other Collateral Transactions
The Company is required by law to deposit securities with government agencies in certain states in which it conducts business. As of December 31, 2023 and 2022 (Successor Company), the fair value of securities on deposit was $22 and $20, respectively.
For disclosure of collateral in support of derivative transactions, refer to the Derivative Collateral Arrangements section of Note 4 - Derivatives.
Variable Interest Entities
As of December 31, 2023 and 2022, the Company did not hold any investment in a VIE for which it was the primary beneficiary.
The Company’s maximum exposure to loss as of December 31, 2023 and 2022 of non-consolidated VIE included in investment funds on the Company's balance sheets is limited to $1,428 and $1,300, respectively. The Company’s maximum exposure to loss as of December 31, 2023 and 2022 of non-consolidated VIEs included in fixed maturities on the Company's balance sheets is limited to $4,124 and $323, respectively. As of December 31, 2023 and 2022, the Company
had outstanding commitments totaling $939 and $410, respectively, whereby the Company is committed to fund these investments and may be called by the VIE during the commitment period to fund the purchase of new investments and partnership expenses. These investments are generally of a passive nature in that the Company does not take an active role in management.
Equity Method Investments
The majority of the Company's investment funds, including hedge funds, mortgage and real estate funds, and private equity and other funds, are accounted for under the equity method of accounting. The Company recognized total equity method income of $116 and $168 for the years ended December 31, 2023 and 2022 (Successor Company). Equity method income is reported in net investment income. The Company’s maximum exposure to loss as of December 31, 2023 (Successor Company) is limited to the total carrying value of $1.4 billion. In addition, the Company has outstanding commitments totaling approximately $559 related to as of December 31, 2023 (Successor Company).
For the year ended December 31, 2023 (Successor Company), aggregate net investment income from investment funds exceeded 10% of the Company’s pre-tax net income. Accordingly, the Company is disclosing summarized financial data in the subsequent table which reflects the latest available financial information. This aggregated summarized financial data does not represent the Company’s proportionate share of the investment's assets or earnings.
Successor Company
As of December 31,
(in billions)
2023
2022
Total assets
$176.4 $172.7 
Total liabilities
29.4 28.6 
Net income12.7 6.6 
Concentration of Credit Risk
The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk. The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk. The following table discloses the Company’s investment exposure to any credit concentration risk of a single issuer greater than 10% of the Company's shareholder’s equity, other than the U.S. government and certain U.S. government agencies:
Market Value
Pacific Investment Management Inc.$370 
Morgan Stanley263 
Wells Fargo & Company256 
J.P. Morgan Chase & Co.229 
Citigroup180 
Madison Capital Funding179 
Deutsche Telekom157 
Strategic Partners Fund VIII L.P.145 
Bank Of America Corp.134 
UBS128 
Comm Mortgage Trust 115 
HSBC Holdings Plc113 
Goldman Sachs Group Inc.105