Fair Value Measurements

12 Months Ended

Dec. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company carries certain financial assets and liabilities at estimated fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants. Our fair value framework includes a hierarchy that gives the highest priority to the use of quoted prices in active markets, followed by the use of market observable inputs, followed by the use of unobservable inputs. The fair value hierarchy levels are as follows:

Level 1    Fair values based primarily on unadjusted quoted prices for identical assets or liabilities, in active markets that the Company has the ability to access at the measurement date.

Level 2    Fair values primarily based on observable inputs, other than quoted prices included in Level 1, or based on prices for similar assets and liabilities.

Level 3    Fair values derived when one or more of the significant inputs are unobservable (including assumptions about risk). With little or no observable market, the determination of fair value uses considerable judgment and represents the Company’s best estimate of an amount that could be realized in a market exchange for the asset or liability. Also included are securities that are traded within illiquid markets and/or priced by independent brokers.

Net Asset Value ("NAV") – Other invested assets within separate accounts are typically measured using NAV as a practical expedient in determining fair value and are not classified in the fair value hierarchy. The carrying value reflects the pro rata ownership percentage as indicated by NAV in the investment’s financial statements, which may be adjusted if it’s determined NAV is not calculated consistent with investment company fair value principles. The underlying investments may have significant unobservable inputs, which may include but are not limited to, comparable multiples and weighted average cost of capital rates applied in valuation models or a discounted cash flow model.

The Company will classify the financial asset or liability by level based upon the lowest level input that is significant to the determination of the fair value. In most cases, both observable inputs (e.g., changes in interest rates) and unobservable inputs (e.g., changes in risk assumptions) are used to determine the fair value of assets and liabilities that the Company has classified within Level 3.

The following presents the hierarchy for our assets and liabilities measured at fair value on a recurring basis:

	Total		NAV / Netting [1]		Level 1		Level 2		Level 3
As of December 31, 2023
Assets
Fixed maturities
Asset-backed securities	$	363	$	—	$	—	$	313	$	50
Collateralized loan obligations	966		—		—		847		119
Commercial mortgage-backed securities	1,446		—		—		1,440		6
Corporate bonds	9,545		—		—		8,054		1,491
Foreign government and agencies	404		—		—		404		—
Municipal bonds	803		—		—		803		—
Residential mortgage-backed securities	445		—		—		412		33
U.S. Treasury bonds	882		—		—		882		—
Total fixed maturities, available-for-sale	14,854		—		—		13,155		1,699
Fair value option fixed maturities	252		—		—		27		225
Total fixed maturities	15,106		—		—		13,182		1,924
Equity securities	182		—		9		150		23
Investment funds	238		—		—		—		238
Other investments
Freestanding derivatives [1]	35		(138)		11		22		140
Short-term investments	1,181		—		661		52		468

	Total		NAV / Netting [1]		Level 1		Level 2		Level 3
Reinsurance recoverables
Fixed indexed annuities hedge program	193		—		—		—		193
Reinsurance recoverable for FIA embedded derivative	406		—		—		—		406
Ceded other embedded derivative	(5)		—		—		—		(5)
Ceded market risk benefits	648		—		—		—		648
Total reinsurance recoverables	1,242		—		—		—		1,242
Market risk benefits	578		—		—		—		578
Separate account assets	89,514		200		54,877		34,389		48
Total assets	$	108,076	$	62	$	55,558	$	47,795	$	4,661
Liabilities
Other policyholder funds and benefits payable
Fixed indexed annuities embedded derivatives	$	541	$	—	$	—	$	—	$	541
Other embedded derivative	(5)		—		—		—		(5)
Total other policyholder funds and benefits payable	536		—		—		—		536
Market risk benefits	1,074		—		—		—		1,074
Funds withheld liability
Modified coinsurance embedded derivative	(110)		—		—		(110)		—
Related party modified coinsurance embedded derivative	(192)		—		—		(192)		—
Fixed indexed annuities hedge program retrocession	145		—		—		—		145
Total funds withheld liability	(157)		—		—		(302)		145
Other liabilities
Freestanding derivatives [1]	57		(306)		11		284		68
Total liabilities	$	1,510	$	(306)	$	11	$	(18)	$	1,823
As of December 31, 2022
Assets
Fixed maturities
Asset-backed securities	$	254	$	—	$	—	$	213	$	41
Collateralized loan obligations	676		—		—		567		109
Commercial mortgage-backed securities	1,514		—		—		1,237		277
Corporate bonds	10,241		—		—		9,622		619
Foreign government and agencies	315		—		—		311		4
Municipal bonds	1,040		—		—		1,039		1
Residential mortgage-backed securities	417		—		—		400		17
U.S. Treasury bonds	926		—		—		926		—
Total fixed maturities, available-for-sale	15,383		—		—		14,315		1,068
Fair value option fixed maturities	331		—		—		25		306
Total fixed maturities	15,714		—		—		14,340		1,374
Equity securities	179		—		—		155		24
Investment funds	58		—		—		—		58

	Total		NAV / Netting [1]		Level 1		Level 2		Level 3
Other investments
Freestanding derivatives [1]	83		(112)		—		40		155
Short-term investments	1,489		—		742		610		137
Reinsurance recoverables
Fixed indexed annuities hedge program	49		—		—		—		49
Reinsurance recoverable for FIA embedded derivative	243		—		—		—		243
Funds withheld embedded derivative	129		—		—		129		—
Ceded other embedded derivatives	(29)		—		—		—		(29)
Ceded market risk benefits	894		—		—		—		894
Total reinsurance recoverables	1,286		—		—		129		1,157
Market risk benefits	325		—		—		—		325
Separate account assets	87,255		288		53,775		33,139		53
Total assets	$	106,389	$	176	$	54,517	$	48,413	$	3,283
Liabilities
Other policyholder funds and benefits payable
Fixed indexed annuities embedded derivatives	$	324	$	—	$	—	$	—	$	324
Other embedded derivative	(29)		—		—		—		(29)
Total other policyholder funds and benefits payable	295		—		—		—		295
Market risk benefits	1,204		—		—		—		1,204
Funds withheld liability
Modified coinsurance embedded derivative	(597)		—		—		(597)		—
Fixed indexed annuities hedge program retrocession	37		—		—		—		37
Total funds withheld liability	(560)		—		—		(597)		37
Other liabilities
Freestanding derivatives [1]	105		139		—		(41)		7
Total liabilities	$	1,044	$	139	$	—	$	(638)	$	1,543

[1]“Netting” represents the fair value of freestanding derivatives as well as cash collateral and accrued income offset under master netting agreements. Refer to Note 4 - Derivatives for additional information regarding offsetting of derivatives.

Valuation Techniques

The Company generally determines fair values using valuation techniques that use prices, rates, and other relevant information evident from market transactions involving identical or similar instruments. Valuation techniques also include, where appropriate, estimates of future cash flows that are converted into a single discounted amount using current market expectations. The Company uses a "waterfall" approach comprised of the following pricing sources and techniques, which are listed in priority order:

•Quoted prices, unadjusted, for identical assets or liabilities in active markets, which are classified as Level 1.

•Prices from third-party pricing services, which primarily utilize a combination of techniques. These services utilize recently reported trades of identical, similar, or benchmark securities making adjustments for market observable inputs available through the reporting date. If there are no recently reported trades, they may use a discounted cash flow

technique to develop a price using expected cash flows based upon the anticipated future performance of the underlying collateral discounted at an estimated market rate. Both techniques develop prices that consider the time value of future cash flows and provide a margin for risk, including liquidity and credit risk. Most prices provided by third-party pricing services are classified as Level 2 because the inputs used in pricing the securities are observable. However, some securities that are less liquid or trade less actively are classified as Level 3. Additionally, certain long-dated securities, such as municipal securities and bank loans, include benchmark interest rate or credit spread assumptions that are not observable in the marketplace and are thus classified as Level 3.

•Internal matrix pricing is a valuation process internally developed for private placement securities for which the Company is unable to obtain a price from a third-party pricing service. Internal pricing matrices determine credit spreads that, when combined with risk-free rates, are applied to contractual cash flows to develop a price. The Company develops credit spreads using market based data for public securities adjusted for credit spread differentials between public and private securities, which are obtained from a survey of multiple private placement brokers. The market-based reference credit spread considers the issuer’s sector, financial strength, and term to maturity, using an independent public security index, while the credit spread differential considers the non-public nature of the security. Securities priced using internal matrix pricing are classified as Level 2 because the significant inputs are observable or can be corroborated with observable data.

•Independent broker quotes, which are typically non-binding use inputs that can be difficult to corroborate with observable market based data. Brokers may use present value techniques using assumptions specific to the security types, or they may use recent transactions of similar securities. Due to the lack of transparency in the process that brokers use to develop prices, valuations that are based on independent broker quotes are classified as Level 3.

The fair value of freestanding derivative instruments is determined primarily using a discounted cash flow model or option model technique and incorporates counterparty credit risk. In some cases, quoted market prices for exchange-traded and OTC cleared derivatives may be used and in other cases independent broker quotes may be used. The pricing valuation models primarily use inputs that are observable in the market or can be corroborated by observable market data. The valuation of certain derivatives may include significant inputs that are unobservable, such as volatility levels, and reflect the Company’s view of what other market participants would use when pricing such instruments.

Fair values for FIA embedded derivatives are classified as Level 3 in the fair value hierarchy and are calculated using internally developed models that utilize significant unobservable inputs because active, observable markets do not exist for these items.

Valuation Inputs

Quoted prices for identical assets in active markets are considered Level 1 and consist of on-the-run U.S. Treasuries, money market funds, exchange-traded equity securities, open-ended mutual funds, certain short-term investments, and exchange traded futures and option contracts.

Primary observable and unobservable inputs for level 2 and level 3 fair value measurements are described below.

Fixed Maturities

Structured Securities

Primary observable inputs include: benchmark yields and spreads; monthly payment information; collateral performance, which varies by vintage year and includes delinquency rates, loss severity rates and refinancing assumptions; and credit default swap indices. Primary observable inputs specific to ABS, CLOs, and RMBS include: estimates of future principal prepayments, derived from the characteristics of the underlying structure; and prepayment speeds previously experienced at the interest rate levels projected for the collateral.

Primary unobservable inputs include: independent broker quotes; and credit spreads and interest rates beyond the observable curves. Primary unobservable inputs specific to less liquid securities or those that trade less actively, including subprime RMBS include: estimated cash flows; credit spreads, which include illiquidity premium; constant prepayment rates; constant default rates; and loss severity.

Corporate Bonds

Includes private placement securities for which the Company has elected the fair value option.

Primary observable inputs include: benchmark yields and spreads; reported trades, bids, offers of the same or similar securities; issuer spreads; and credit default swap curves. Primary observable specific to investment grade privately placed securities that utilize internal matrix pricing include credit spreads for public securities of similar quality, maturity, and sector, adjusted for non-public nature.

Primary unobservable inputs include: independent broker quotes; credit spreads beyond the observable curve; and interest rates beyond the observable curve. Primary unobservable inputs specific to below investment grade privately placed securities and private bank loans include credit spreads for public securities of similar quality, maturity, and sector, adjusted for non-public nature.

Foreign Government and Agencies, Municipal Bonds, and U.S. Treasury Bonds

Primary observable inputs include: benchmark yields and spreads; issuer credit default swap curves; political events in emerging market economies; Municipal Securities Rulemaking Board reported trades and material event notices; and issuer financial statements.

Primary unobservable inputs include credit spreads and interest rates beyond the observable curves.

Equity Securities

Primary observable inputs include quoted prices in markets that are not active.

Primary unobservable inputs include internal discounted cash flow models utilizing earnings multiples or other cash flow assumptions.

Investment Funds

There are no primary observable inputs.

Primary unobservable inputs include: prices of privately traded securities; and characteristics of privately traded securities, including yield, duration and spread duration. For equity method investments not held at fair value, the carrying value of the investment is based on the latest capital statement received by the Company for their investment.

Freestanding Derivatives

Credit Derivatives

Primary observable inputs include: swap yield curves; and credit default swap curves.

Foreign Currency Derivatives

Primary observable inputs include: the swap yield curve; currency spot and forward rates; and cross currency basis curves.

Interest Rate Derivatives

Primary observable inputs include the swap yield curve.

Primary unobservable inputs include: independent broker quotes; interest rate volatility; and the swap curve beyond 30 years.

Short-Term Investments

Primary observable inputs include: benchmark yields and spreads; reported trades, bids, and offers; issuer spreads and credit default swap curves; and material event notices and new issue money market rates.

Primary unobservable inputs include independent broker quotes.

Fixed Indexed Annuities Embedded Derivatives

Primary observable inputs include: risk-free rates as represented by the Eurodollar futures, LIBOR deposits and swap rates to derive forward curve rates; correlations of 10 years of observed historical returns across underlying well-known market indices; correlations of historical index returns compared to separate account fund returns; and equity index levels.

Primary unobservable inputs include: market implied equity volatility assumptions; credit standing adjustment assumptions; option budgets; and assumptions about policyholder behavior, such as withdrawal utilization, withdrawal rates, lapse rates, and reset elections.

The fair value for the FIA embedded derivatives are calculated as an aggregation of the following components: Best Estimate Benefits; Credit Standing Adjustment; and Margins. The Company believes the aggregation of these components results in an amount that a market participant in an active liquid market would require, if such a market existed. Each component described in the following discussion is unobservable in the marketplace and requires subjectivity by the Company in determining its value.

Best Estimate Benefits

The Best Estimate Benefits are calculated based on actuarial and capital market assumptions related to projected cash flows, including the present value of benefits and related contract charges, over the lives of the contracts, incorporating unobservable inputs including expectations concerning policyholder behavior.

Credit Standing Adjustment

The credit standing adjustment is an estimate of the adjustment to the fair value that market participants would require in determining fair value to reflect the risk will not be fulfilled. The Company incorporates a blend of estimates of peer company and reinsurer bond spreads and credit default spreads from capital markets.

Margins

The behavior risk margin adds a margin that market participants would require, in determining fair value, for the risk that the Company’s assumptions about policyholder behavior could differ from actual experience. The behavior risk margin is calculated by taking the difference between adverse policyholder behavior assumptions and best estimate assumptions.

Separate Account Assets

Separate account assets include fixed maturities, equity securities (largely consisted of mutual funds), mortgage loans, short-term investments, and other invested assets (largely consisted of investment funds and freestanding derivatives) that are valued in the same manner, and using the same pricing sources and inputs, as those investments held by the Company.

For other invested assets in which fair value represents a share of the NAV 34% and 53% were subject to significant liquidation restrictions as of December 31, 2023 (Successor Company) and December 31, 2022 (Predecessor Company), respectively. As of December 31, 2023 (Successor Company) and December 31, 2022 (Predecessor Company), there were no investment funds that did not allow any form of redemption.

Separate account assets classified as Level 3 primarily include long-dated bank loans, subprime RMBS and commercial mortgage loans.

The following summarizes the significant unobservable inputs for level 3 fixed maturities, freestanding derivatives, and FIA embedded derivatives:

Fair Value		Predominant Valuation Technique	Significant Unobservable Input	Range	Weighted Average [1]	Impact of Increase in Input on Fair Value [2]
As of December 31, 2023
Asset-backed securities
$	50	Discounted cash flows	Spread	251bps to 426bps	316bps	Decrease
Collateralized loan obligations [3]:
$	59	Option model	Spread	268bps to 270bps	269bps	Decrease
Commercial mortgage-backed securities:
$	6	Discounted cash flows	Spread (encompasses prepayment, default risk and loss severity)	1,041bps to 1,041bps	1,041bps	Decrease
Corporate bonds [3]:
$	1,421	Discounted cash flows	Spread	49bps to 894bps	246bps	Decrease
Residential mortgage-backed securities [3]:
$	14	Discounted cash flows	Spread [5]	387bps to 387bps	387bps	Decrease
Fair value option fixed maturities
$	225	Discounted cash flows	Spread	2bps to 312bps	166bps	Decrease
Macro hedge program [3]:
$	(2)	Option model	Equity volatility	10.81% to 31.73%	17.9%	Increase

Fair Value		Predominant Valuation Technique	Significant Unobservable Input	Range	Weighted Average [1]	Impact of Increase in Input on Fair Value [2]
$	84		Interest rate volatility	0.22% to 2.86%	1.2%	Increase
Fixed indexed annuities embedded derivatives:
$	541		Withdrawal rates [6]	0.0% to 15.9%	1.7%	Decrease
			Lapse rates [7]	0.3% to 30.0%	6.4%	Decrease
			Option budgets [8]	0.1% to 3.8%	1.5%	Increase
			Credit standing adjustment [9]	0.6% to 2.5%	1.6%	Decrease
As of December 31, 2022
Collateralized loan obligations [3]:
$	109	Discounted cash flows	Spread	55 bps to 337 bps	325bps	Decrease
Commercial mortgage-backed securities:
$	277	Discounted cash flows	Spread (encompasses prepayment, default risk and loss severity)	419 bps to 1,001 bps	534bps	Decrease
Corporate bonds [3]:
$	901	Discounted cash flows	Spread	71 bps to 719 bps	309bps	Decrease
Residential mortgage-backed securities [3]:
$	13	Discounted cash flows	Spread [5]	62 bps to 227 bps	138bps	Decrease
			Constant prepayment rate [5]	2% to 10%	6.0%	Decrease
			Constant default rate [5]	1% to4%	2.0%	Decrease
			Loss severity [5]	10% to 65%	25.0%	Decrease
Variable annuities macro hedge program [3]:
$	65	Option model	Equity volatility	18% to 64%	26.0%	Increase
97			Interest rate volatility	1% to 1%	1.0%	Increase
Fixed indexed annuities embedded derivatives:
$	324		Withdrawal rates [6]	0.0% to 15.9%	1.7%	Decrease
			Lapse rates [7]	1.0%to 25.0%	6.5%	Decrease
			Option budgets [8]	0.5% to 3.8%	1.6%	Increase
			Credit standing adjustment [9]	0.4% to 3.1%	1.7%	Decrease

[1]The weighted average is determined based on the fair value of the securities.

[2]Conversely, the impact of a decrease in input would have the opposite impact to the fair value as that presented in the table.

[3]Excludes securities for which the Company bases fair value on broker quotations.

[4]Decrease for above market rate coupons and increase for below market rate coupons.

[5]Generally, a change in the assumption used for the constant default rate would have been accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for constant prepayment rate and would have resulted in wider spreads.

[6]Range represents assumed annual percentage of allowable amount withdrawn.

[7]Range represents assumed annual percentages of policyholders electing a full surrender.

[8]Range represents assumed annual budget for index options.

[9]Range represents Company credit spreads.

Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis

The Company uses derivative instruments to manage the risk associated with certain assets and liabilities. However, the derivative instrument may not be classified within the same fair value hierarchy level as the associated asset or liability. Therefore, the realized and unrealized gains and losses on derivatives reported in the Level 3 rollforwards may be offset by realized and unrealized gains and losses of the associated assets and liabilities in other line items of the financial statements.

The following tables present a reconciliation of the beginning and ending balances for Level 3 assets and liabilities measured at fair value on a recurring basis. Assets and liabilities are transferred in and/or out of Level 3 on the date the event or change in circumstances that caused the transfer occurs. The Company evaluates, at least annually, its valuation processes to determine if changes in circumstances has occurred that would result in a transfer between levels. Transfers in and/or out of Level 3 are primarily attributable to the availability of market observable information and the re-evaluation of the observability of pricing inputs. During the 2023 review of the inputs, the Company deemed the spread inputs to be unobservable, and transferred those private securities included in corporate bonds from Level 2 to Level 3.

	Beginning Balance		Total Realized and Unrealized Gains (Losses) in				Net Purchases, Sales, and Settlements		Net Transfers		Ending Balance
			Net Income (Loss)		Other Comprehensive Loss [2]
Year Ended December 31, 2023
Fixed maturities, available-for-sale:
Asset-backed securities	$	41	$	—	$	1	$	8	$	—	$	50
Collateralized loan obligations	109		—		1		9		—		119
Commercial mortgage-backed securities	277		—		6		(65)		(212)		6
Corporate bonds	619		(3)		(68)		497		446		1,491
Foreign government and agencies	4		—		—		—		(4)		—
Municipal bonds	1		—		—		—		(1)		—
Residential mortgage-backed securities	17		—		—		31		(15)		33
Fair value option fixed maturities	306		(24)		—		80		(137)		225
Equity securities	24		—		—		(1)		—		23
Investment funds	58		36		—		7		137		238
Embedded derivatives [1]:
Fixed indexed annuities	(81)		(54)		—		34		(34)		(135)
Other	—		5		—		(5)		—		—
Freestanding derivatives [1]:
Interest rate derivatives	—		(10)		—		—		—		(10)
Variable annuities macro hedge program	148		(498)		—		432		—		82
Short-term investments	137		—		—		368		(37)		468
Fixed indexed annuities hedge program [1]	12		22		—		14		—		48
Ceded market risk benefits	894		(246)		—		—		—		648
Separate account assets	53		3		—		(3)		(5)		48
Year Ended December 31, 2022
Fixed maturities, available-for-sale:
Asset-backed securities	$	—	$	—	$	(2)	$	46	$	(3)	$	41
Collateralized loan obligations	159		—		(1)		26		(75)		109
Commercial mortgage-backed securities	276		—		(26)		34		(7)		277

	Beginning Balance	Total Realized and Unrealized Gains (Losses) in		Net Purchases, Sales, and Settlements	Net Transfers	Ending Balance
		Net Income (Loss)	Other Comprehensive Loss [2]
Corporate bonds	665	(2)	(43)	(15)	14	619
Foreign government and agencies	—	—	(1)	5	—	4
Municipal bonds	1	—	—	—	—	1
Residential mortgage-backed securities	74	—	(1)	(23)	(33)	17
Fair value option fixed maturities	—	(21)	—	327	—	306
Equity securities	21	6	—	(3)	—	24
Investment funds	—	16	—	42	—	58
Embedded derivatives [1]:
Fixed indexed annuities	(524)	200	—	262	(19)	(81)
Other	—	5	—	(5)	—	—
Freestanding derivatives [1]:
Interest rate derivatives	—	22	—	(22)	—	—
Variable annuities macro hedge program	(188)	74	—	262	—	148
						—
Short-term investments	75	—	—	112	(50)	137
Fixed indexed annuities hedge program [1]	—	(22)	—	34	—	12
Ceded market risk benefits	737	157	—	—	—	894
Separate account assets	79	(2)	—	76	(100)	53

[1]Derivative instruments and the FIA hedge program are reported in this table on a net basis for asset (liability) positions.

[2]Recorded in unrealized gain (loss) on available-for-sale securities in the statements of comprehensive income.

The following presents the amount, for recurring fair value measurements categorized within Level 3 of the fair value hierarchy, of the total realized and unrealized gains (losses) for the period included in net income (loss) as shown in the table above:

	Net Investment Income		Investment and Derivative Related Losses, Net		Other [3]		Net Income (Loss)
Year Ended December 31, 2023
Fixed maturities, available-for-sale:
Corporate bonds	$	(3)	$	—	$	—	$	(3)
Fair value option fixed maturities	—		(24)		—		(24)
Investment funds	—		36		—		36
Embedded derivatives:
Fixed indexed annuities	—		(54)		—		(54)
Other	—		5		—		5
Freestanding derivatives:
Interest rate derivatives	—		(10)		—		(10)
Variable annuities macro hedge program	—		(498)		—		(498)

	Net Investment Income		Investment and Derivative Related Losses, Net		Other [3]		Net Income (Loss)
Fixed indexed annuities hedge program	—		22		—		22
Ceded market risk benefits	—		—		(246)		(246)
Separate account assets [2]	—		3		—		3
Year Ended December 31, 2022
Fixed maturities, available-for-sale:
Corporate bonds	$	(2)	$	—	$	—	$	(2)
Fair value option fixed maturities	—		(21)		—		(21)
Equity securities	—		6		—		6
Investment funds	—		16		—		16
Embedded derivatives:
Fixed indexed annuities	—		200		—		200
Other	—		5		—		5
Freestanding derivatives:
Interest rate derivatives	—		22		—		22
Variable annuities macro hedge program	—		74		—		74
Fixed indexed annuities hedge program	—		(22)		—		(22)
Ceded market risk benefits	—		—		157		157
Separate account assets [2]	—		(2)		—		(2)

[1]The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities, which results in a net zero impact on net income for the Company.

[2]Includes both market and non-market impacts in deriving realized and unrealized gains (losses).

[3]Other represents change in MRBs for ceded MRBs and benefits and losses for FIA embedded derivatives.

The following represents the gross components of net purchases, sales, and settlements, and net transfers shown above:

	Purchases		Settlements		Sales		Net		Transfers in		Transfers out		Net
Year Ended December 31, 2023
Fixed maturities, available-for-sale:
Asset-backed securities	$	25	$	(17)	$	—	$	8	$	—	$	—	$	—
Collateralized loan obligations	59		—		(50)		9		—		—		—
Commercial mortgage-backed securities	1		—		(66)		(65)		—		(212)		(212)
Corporate bonds	674		(177)		—		497		488		(42)		446
Foreign government and agencies	—		—		—		—		—		(4)		(4)
Municipal bonds	—		—		—		—		—		(1)		(1)
Residential mortgage-backed securities	33		(2)		—		31		—		(15)		(15)
Fair value option fixed maturities	94		—		(14)		80		—		(137)		(137)
Equity securities	3		—		(4)		(1)		—		—		—
Investment funds	13		(6)		—		7		137		—		137

	Purchases		Settlements		Sales		Net		Transfers in		Transfers out		Net
Embedded derivatives:
Fixed indexed annuities	42		(8)		—		34		(42)		8		(34)
Other	—		(5)		—		(5)		—		—		—
Freestanding derivatives:
Interest rate derivatives	—		—		—		—		—		—		—
Variable annuities macro hedge program	72		—		360		432		—		—		—
Short-term investments	528		(160)		—		368		—		(37)		(37)
Fixed indexed annuities hedge program	32		(18)		—		14		—		—		—
Separate account assets	$	123	$	—	$	(126)	$	(3)	$	43	$	(48)	$	(5)
Year Ended December 31, 2022
Fixed maturities, available-for-sale:
Asset-backed securities	$	52	$	(6)	$	—	$	46	$	—	$	(3)	$	(3)
Collateralized loan obligations	80		(54)		—		26		—		(75)		(75)
Commercial mortgage-backed securities	68		(34)		—		34		—		(7)		(7)
Corporate bonds	132		(137)		(10)		(15)		20		(6)		14
Foreign government and agencies	5		—		—		5		—		—		—
Municipal bonds	—		—		—		—		—		—		—
Residential mortgage-backed securities	22		(26)		(19)		(23)		—		(33)		(33)
Fair value option fixed maturities	327		—		—		327		—		—		—
Equity securities	8		(11)		—		(3)		—		—		—
Investment funds	42		—		—		42		—		—		—
Embedded derivatives:
Fixed indexed annuities	291		(29)		—		262		(41)		22		(19)
Other	—		(5)		—		(5)		—		—		—
Freestanding derivatives:
Interest rate derivatives	—		(22)		—		(22)		—		—		—
Variable annuities macro hedge program	351		(89)		—		262		—		—		—
Short-term investments	192		(80)		—		112		—		(50)		(50)
Fixed indexed annuities hedge program	86		(52)		—		34		—		—		—
Separate account assets	$	99	$	—	$	(23)	$	76	$	—	$	(100)	$	(100)

The following presents the amount, for recurring fair value measurements categorized within Level 3 of the fair value hierarchy still held at the end of the period, of the total unrealized gains (losses) for the period included in net income (loss) and OCI:

	Year Ended December 31,
	2023		2022
	Net Income (Loss)	Other Comprehensive Loss [1]	Net Income (Loss)	Other Comprehensive Loss [1]
Fixed maturities, available-for-sale:

	Year Ended December 31,
	2023				2022
	Net Income (Loss)		Other Comprehensive Loss [1]		Net Income (Loss)		Other Comprehensive Loss [1]
Asset-backed securities	$	—	$	(1)	$	—	$	(2)
Collateralized loan obligations	—		—		—		(1)
Commercial mortgage-backed securities	—		(2)		—		(26)
Corporate bonds	—		(171)		(2)		(43)
Residential mortgage-backed securities	—		—		—		(2)
Fair value option fixed maturities	9		—		(21)		—
Investment funds	(22)		—		16		—
Embedded derivatives:
Other	5		—		5		—
Freestanding derivatives:
Interest rate derivatives	(11)		—		(3)		—
Variable annuities macro hedge program	(216)		—		42		—
Fixed indexed annuities hedge program	22		—		(22)		—
Ceded market risk benefits	(246)		—		157		—
Separate account assets	$	3	$	—	$	(2)	$	—

[1]Recorded in unrealized gain (loss) on available-for-sale securities in the statements of comprehensive income.

The following presents the carrying amount and fair value of the Company’s financial assets and liabilities not carried at fair value:

		As of December 31,
	Fair Value Hierarchy Level	2023				2022
		Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Policy loans	Level 2	$	1,528	$	1,528	$	1,495	$	1,495
Mortgage loans	Level 3	2,019		1,814		2,520		2,232
Liabilities
Other policyholder funds and benefits payable [1]	Level 3	$	9,921	$	8,305	$	10,675	$	8,666
Funds withheld liability	Level 2	10,367		10,367		11,034		11,034

[1]This amount includes contracts accounted for as investment contracts in the scope of ASC 944 and excludes contracts accounted for as insurance contracts, such as our group accident and health, universal life insurance contracts, COLI, and certain FIA and VA contracts with death or other additional benefits.