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Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value of Financial Instruments [Abstract]

Carrying And Estimated Fair Values Of Financial Instruments



	As of September 30, 2019						As of December 31, 2018
	Carrying			Fair			Carrying			Fair
	Value			Value			Value			Value
Assets
Fixed maturity AFS securities	$	103,659		$	103,659		$	94,024		$	94,024
Trading securities		4,691			4,691			1,950			1,950
Equity securities		158			158			99			99
Mortgage loans on real estate		15,947			16,757			13,260			13,092
Derivative investments ⁽¹⁾		2,201			2,201			1,107			1,107
Other investments		3,377			3,377			2,255			2,255
Cash and invested cash		2,939			2,939			2,345			2,345
Other assets:
GLB direct embedded derivatives		-			-			123			123
GLB ceded embedded derivatives		241			241			72			72
Indexed annuity ceded embedded derivatives		891			891			902			902
Separate account assets		145,092			145,092			132,833			132,833

Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(2,098	)		(2,098	)		(1,305	)		(1,305	)
Other contract holder funds:
Remaining guaranteed interest and similar contracts		(1,947	)		(1,947	)		(542	)		(542	)
Account values of certain investment contracts		(37,508	)		(47,276	)		(34,535	)		(36,358	)
Short-term debt		(300	)		(304	)		-			-
Long-term debt		(6,070	)		(6,047	)		(5,839	)		(5,604	)
Reinsurance related embedded derivatives		(339	)		(339	)		(3	)		(3	)
Other liabilities:
Derivative liabilities⁽¹⁾		(584	)		(584	)		(160	)		(160	)
GLB direct embedded derivatives		(846	)		(846	)		-			-

⁽¹⁾We have master netting agreements with each of our derivative counterparties, which allow for the netting of our derivative asset and liability positions by counterparty.

Fair Value Of Assets And Liabilities On A Recurring Basis



		As of September 30, 2019
		Quoted
		Prices
		in Active
	Markets for			Significant				Significant
		Identical		Observable				Unobservable				Total
		Assets			Inputs				Inputs			Fair
		(Level 1)			(Level 2)				(Level 3)			Value
Assets
Investments:
Fixed maturity AFS securities:
Corporate bonds		$	-		$	84,002			$	3,909		$	87,911
U.S. government bonds			421			17				-			438
State and municipal bonds			-			5,800				-			5,800
Foreign government bonds			-			329				115			444
RMBS			-			3,277				10			3,287
CMBS			-			1,023				9			1,032
ABS			-			3,955				217			4,172
Hybrid and redeemable preferred securities			77			420				78			575
Trading securities			50			4,075				566			4,691
Equity securities			47			57				54			158
Derivative investments ⁽¹⁾			-			1,667				1,320			2,987
Other investments			153			-				-			153
Cash and invested cash			-			2,939				-			2,939
Other assets:
GLB ceded embedded derivatives			-			-				241			241
Indexed annuity ceded embedded derivatives			-			-				891			891
Separate account assets			571			144,508				-			145,079
Total assets		$	1,319		$	252,069			$	7,410		$	260,798

Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		$	-		$	-			$	(2,098	)	$	(2,098	)
Reinsurance related embedded derivatives			-			(339	)			-			(339	)
Other liabilities:
Derivative liabilities ⁽¹⁾			-			(841	)			(529	)		(1,370	)
GLB direct embedded derivatives			-			-				(846	)		(846	)
Total liabilities		$	-		$	(1,180	)		$	(3,473	)	$	(4,653	)

‎


		As of December 31, 2018
		Quoted
		Prices
		in Active
	Markets for			Significant				Significant
		Identical		Observable				Unobservable				Total
		Assets			Inputs				Inputs			Fair
		(Level 1)			(Level 2)				(Level 3)			Value
Assets
Investments:
Fixed maturity AFS securities:
Corporate bonds		$	-		$	77,079			$	3,269		$	80,348
U.S. government bonds			399			18				-			417
State and municipal bonds			-			5,345				-			5,345
Foreign government bonds			-			339				109			448
RMBS			-			3,366				7			3,373
CMBS			-			802				2			804
ABS			-			2,562				134			2,696
Hybrid and redeemable preferred securities			67			451				75			593
Trading securities			43			1,840				67			1,950
Equity securities			16			58				25			99
Derivative investments ⁽¹⁾			-			727				705			1,432
Other investments			150			-				-			150
Cash and invested cash			-			2,345				-			2,345
Other assets:
GLB direct embedded derivatives			-			-				123			123
GLB ceded embedded derivatives			-			-				72			72
Indexed annuity ceded embedded derivatives			-			-				902			902
Separate account assets			665			132,135				-			132,800
Total assets		$	1,340		$	227,067			$	5,490		$	233,897

Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		$	-		$	-			$	(1,305	)	$	(1,305	)
Reinsurance related embedded derivatives			-			(3	)			-			(3	)
Other liabilities – derivative liabilities ⁽¹⁾			-			(314	)			(171	)		(485	)
Total liabilities		$	-		$	(317	)		$	(1,476	)	$	(1,793	)

⁽¹⁾Derivative investment assets and liabilities are presented within the fair value hierarchy on a gross basis by derivative type and not on a master netting basis by counterparty.

‎

Fair Value Measured On A Recurring Basis Reconciliation



	For the Three Months Ended September 30, 2019
							Gains		Issuances,				Transfers
				Items			(Losses)			Sales,			Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽³⁾			Value
Investments: ⁽⁵⁾
Fixed maturity AFS securities:
Corporate bonds	$	3,648		$	3		$	(49	)	$	256		$	51		$	3,909
Foreign government bonds		113			-			2			-			-			115
RMBS		-			-			-			10			-			10
CMBS		2			-			-			7			-			9
ABS		320			-			1			69			(173	)		217
Hybrid and redeemable
preferred securities		78			-			-			-			-			78
Trading securities		523			10			-			146			(113	)		566
Equity securities		68			(11	)		-			(3	)		-			54
Derivative investments		466			184			119			22			-			791
Other assets: ⁽⁶⁾
GLB ceded embedded derivatives		111			130			-			-			-			241
Indexed annuity ceded embedded derivatives		903			7			-			(19	)		-			891
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁶⁾		(1,973	)		(30	)		-			(95	)		-			(2,098	)
Other liabilities – GLB direct embedded
derivatives ⁽⁶⁾		(1	)		(845	)		-			-			-			(846	)
Total, net	$	4,258		$	(552	)	$	73		$	393		$	(235	)	$	3,937

‎



	For the Three Months Ended September 30, 2018
							Gains		Issuances,				Transfers
				Items			(Losses)			Sales			Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽³⁾			Value
Investments: ⁽⁵⁾
Fixed maturity AFS securities:
Corporate bonds	$	3,181		$	1		$	(30	)	$	88		$	(31	)	$	3,209
Foreign government bonds		108			-			-			-			-			108
RMBS		-			-			-			7			-			7
CMBS		5			-			-			18			-			23
ABS		176			-			-			17			(111	)		82
Hybrid and redeemable
preferred securities		78			-			(1	)		-			-			77
Trading securities		22			-			-			2			(6	)		18
Equity securities		26			-			-			-			-			26
Derivative investments		93			(115	)		(55	)		431			-			354
Other assets: ⁽⁶⁾
GLB direct embedded derivatives		1,248			400			-			-			-			1,648
GLB ceded embedded derivatives		41			(6	)		-			-			-			35
Indexed annuity ceded embedded derivatives		29			4			-			11			-			44
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁶⁾		(1,400	)		(164	)		-			(7	)		-			(1,571	)
Other liabilities – GLB ceded embedded
derivatives ⁽⁶⁾		(131	)		(62	)		-			-			-			(193	)
Total, net	$	3,476		$	58		$	(86	)	$	567		$	(148	)	$	3,867

‎



	For the Nine Months Ended September 30, 2019
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net			Net ⁽³⁾			Value
Investments: ⁽⁵⁾
Fixed maturity AFS securities:
Corporate bonds	$	3,269		$	3		$	45		$	627		$	(35	)	$	3,909
Foreign government bonds		109			-			6			-			-			115
RMBS		7			-			-			10			(7	)		10
CMBS		2			-			-			7			-			9
ABS		134			-			2			477			(396	)		217
Hybrid and redeemable
preferred securities		75			-			3			-			-			78
Trading securities		67			12			-			723			(236	)		566
Equity securities		25			(11	)		-			40			-			54
Derivative investments		534			(128	)		234			151			-			791
Other assets: ⁽⁶⁾
GLB direct embedded derivatives		123			(123	)		-			-			-			-
GLB ceded embedded derivatives		72			169			-			-			-			241
Indexed annuity ceded embedded derivatives		902			128			-			(139	)		-			891
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁶⁾		(1,305	)		(500	)		-			(293	)		-			(2,098	)
Other liabilities – GLB direct embedded
derivatives ⁽⁶⁾		-			(846	)		-			-			-			(846	)
Total, net	$	4,014		$	(1,296	)	$	290		$	1,603		$	(674	)	$	3,937

‎


	For the Nine Months Ended September 30, 2018
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other ⁽¹⁾			Net ⁽²⁾			Net ⁽³⁾⁽⁴⁾			Value
Investments: ⁽⁵⁾
Fixed maturity AFS securities:
Corporate bonds	$	3,091		$	7		$	(137	)	$	319		$	(71	)	$	3,209
U.S. government bonds		5			-			-			(5	)		-			-
Foreign government bonds		110			-			(2	)		-			-			108
RMBS		12			-			-			7			(12	)		7
CMBS		6			1			-			37			(21	)		23
ABS		118			-			(1	)		169			(204	)		82
Hybrid and redeemable
preferred securities		76			-			1			-			-			77
Equity AFS securities		162			-			-			-			(162	)		-
Trading securities		49			(5	)		-			(20	)		(6	)		18
Equity securities		-			-			-			-			26			26
Derivative investments		30			106			(113	)		331			-			354
Other assets: ⁽⁶⁾
GLB direct embedded derivatives		903			745			-			-			-			1,648
GLB ceded embedded derivatives		51			(16	)		-			-			-			35
Indexed annuity ceded embedded derivatives		11			4			-			29			-			44
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives ⁽⁶⁾		(1,418	)		(175	)		-			22			-			(1,571	)
Other liabilities – GLB ceded embedded
derivatives ⁽⁶⁾		(67	)		(126	)		-			-			-			(193	)
Total, net	$	3,139		$	541		$	(252	)	$	889		$	(450	)	$	3,867

⁽¹⁾The changes in fair value of the interest rate swaps are offset by an adjustment to derivative investments (see Note 6).

⁽²⁾Issuances, sales, maturities, settlements, calls, net, includes financial instruments acquired in the Liberty Life transaction as follows: corporate bonds of $67 million and asset-backed securities of $17 million.

⁽³⁾Transfers into or out of Level 3 for AFS and trading securities are reported at amortized cost as of the beginning-of-year. For AFS and trading securities, the difference between beginning-of-period amortized cost and beginning-of-period fair value was included in OCI and earnings, respectively, in the prior period.

⁽⁴⁾Transfers into or out of Level 3 for FHLB stock between equity securities and other investments are reported at cost on our Consolidated Balance Sheets.

⁽⁵⁾Amortization and accretion of premiums and discounts are included in net investment income on our Consolidated Statements of Comprehensive Income (Loss). Gains (losses) from sales, maturities, settlements and calls and OTTI are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

⁽⁶⁾Gains (losses) from sales, maturities, settlements and calls are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

‎

Schedule Of Investment Holdings Movements



	For the Three Months Ended September 30, 2019
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	337		$	-		$	(21	)	$	(44	)	$	(16	)	$	256
RMBS		10			-			-			-			-			10
CMBS		7			-			-			-			-			7
ABS		79			-			-			(10	)		-			69
Trading securities		150			-			-			(4	)		-			146
Equity securities		-			(3	)		-			-			-			(3	)
Derivative investments		132			(36	)		(74	)		-			-			22
Other assets – indexed annuity ceded
embedded derivatives		9			-			-			(28	)		-			(19	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(124	)		-			-			29			-			(95	)
Total, net	$	600		$	(39	)	$	(95	)	$	(57	)	$	(16	)	$	393



	For the Three Months Ended September 30, 2018
	Issuances			Sales		Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	162		$	-	$	(1	)	$	(65	)	$	(8	)	$	88
RMBS		7			-		-			-			-			7
CMBS		18			-		-			-			-			18
ABS		17			-		-			-			-			17
Trading securities		2			-		-			-			-			2
Derivative investments		96			455		(120	)		-			-			431
Other assets – indexed annuity ceded
embedded derivatives		11			-		-			-			-			11
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(83	)		-		-			76			-			(7	)
Total, net	$	230		$	455	$	(121	)	$	11		$	(8	)	$	567

‎



	For the Nine Months Ended September 30, 2019
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	872		$	(18	)	$	(75	)	$	(129	)	$	(23	)	$	627
RMBS		10			-			-			-			-			10
CMBS		7			-			-			-			-			7
ABS		489			-			-			(12	)		-			477
Trading securities		728			-			-			(5	)		-			723
Equity securities		43			(3	)		-			-			-			40
Derivative investments		403			(47	)		(205	)		-			-			151
Other assets – indexed annuity ceded
embedded derivatives		50			-			-			(189	)		-			(139	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(420	)		-			-			127			-			(293	)
Total, net	$	2,182		$	(68	)	$	(280	)	$	(208	)	$	(23	)	$	1,603



	For the Nine Months Ended September 30, 2018
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	785		$	(156	)	$	(3	)	$	(238	)	$	(69	)	$	319
U.S. government bonds		-			(5	)		-			-			-			(5	)
RMBS		7			-			-			-			-			7
CMBS		39			-			-			(2	)		-			37
ABS		186			(17	)		-			-			-			169
Trading securities		4			(24	)		-			-			-			(20	)
Equity securities		1			(1	)		-			-			-			-
Derivative investments		225			460			(354	)		-			-			331
Other assets – indexed annuity ceded
embedded derivatives		29			-			-			-			-			29
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(158	)		-			-			180			-			22
Total, net	$	1,118		$	257		$	(357	)	$	(60	)	$	(69	)	$	889

Changes In Unrealized Gains (Losses) Within Level 3 Financial Instruments Carried At Fair Value And Still Held



	For the Three						For the Nine
	Months Ended						Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Derivative investments	$	204		$	(1	)	$	(65	)	$	105
Embedded derivatives:
Indexed annuity and IUL contracts		(11	)		(11	)		(87	)		(18	)
GLB		(665	)		576			(452	)		1,264
Total, net⁽¹⁾	$	(472	)	$	564		$	(604	)	$	1,351

⁽¹⁾Included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

Components Of The Transfers In And Out Of Level 3



	For the Three								For the Three
	Months Ended								Months Ended
	September 30, 2019								September 30, 2018
	Transfers		Transfers						Transfers		Transfers
	Into		Out of						Into		Out of
	Level 3		Level 3			Total			Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	51	$	-		$	51		$	11	$	(42	)	$	(31	)
ABS		-		(173	)		(173	)		-		(111	)		(111	)
Trading securities		-		(113	)		(113	)		-		(6	)		(6	)
Total, net	$	51	$	(286	)	$	(235	)	$	11	$	(159	)	$	(148	)



	For the Nine								For the Nine
	Months Ended								Months Ended
	September 30, 2019								September 30, 2018
	Transfers		Transfers						Transfers		Transfers
	Into		Out of						Into		Out of
	Level 3		Level 3			Total			Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	136	$	(171	)	$	(35	)	$	54	$	(125	)	$	(71	)
RMBS		-		(7	)		(7	)		-		(12	)		(12	)
CMBS		-		-			-			-		(21	)		(21	)
ABS		-		(396	)		(396	)		-		(204	)		(204	)
Equity AFS securities		-		-			-			-		(162	)		(162	)
Trading securities		5		(241	)		(236	)		-		(6	)		(6	)
Equity securities		-		-			-			26		-			26
Total, net	$	141	$	(815	)	$	(674	)	$	80	$	(530	)	$	(450	)

Fair Value Inputs Quantitative Information



	Fair			Valuation	Significant	Assumption or
	Value			Technique	Unobservable Inputs	Input Ranges
Assets
Investments:
Fixed maturity AFS and trading
securities:
Corporate bonds	$	2,827		Discounted cash flow	Liquidity/duration adjustment ⁽¹⁾	0.4	%	-	24.0	%
Foreign government bonds		76		Discounted cash flow	Liquidity/duration adjustment ⁽¹⁾	1.1	%	-	3.8	%
ABS		24		Discounted cash flow	Liquidity/duration adjustment ⁽¹⁾	3.0	%	-	3.0	%
Hybrid and redeemable
preferred securities		4		Discounted cash flow	Liquidity/duration adjustment ⁽¹⁾	1.5	%	-	1.5	%

Equity securities		21		Discounted cash flow	Liquidity/duration adjustment ⁽¹⁾	4.5	%	-	5.2	%
Other assets:
GLB ceded embedded derivatives		241		Discounted cash flow	Long-term lapse rate ⁽²⁾	1	%	-	30	%
					Utilization of guaranteed withdrawals ⁽³⁾	85	%	-	100	%
					Claims utilization factor ⁽⁴⁾	60	%	-	100	%
					Premiums utilization factor ⁽⁴⁾	80	%	-	115	%
					NPR ⁽⁵⁾	0.02	%	-	0.35	%
					Mortality rate ⁽⁶⁾				⁽⁸⁾
					Volatility ⁽⁷⁾	1	%	-	29	%

Indexed annuity ceded
embedded derivatives		891		Discounted cash flow	Lapse rate ⁽²⁾	1	%	-	9	%
					Mortality rate ⁽⁶⁾				⁽⁸⁾
Liabilities
Future contract benefits – indexed
annuity and IUL contracts
embedded derivatives	$	(2,098	)	Discounted cash flow	Lapse rate ⁽²⁾	1	%	-	9	%
					Mortality rate ⁽⁶⁾				⁽⁸⁾
Other liabilities – GLB direct
embedded derivatives		(846	)	Discounted cash flow	Long-term lapse rate ⁽²⁾	1	%	-	30	%
					Utilization of guaranteed withdrawals ⁽³⁾	85	%	-	100	%
					Claims utilization factor ⁽⁴⁾	60	%	-	100	%
					Premiums utilization factor ⁽⁴⁾	80	%	-	115	%
					NPR ⁽⁵⁾	0.02	%	-	0.35	%
					Mortality rate ⁽⁶⁾				⁽⁸⁾
					Volatility ⁽⁷⁾	1	%	-	29	%

⁽¹⁾The liquidity/duration adjustment input represents an estimated market participant composite of adjustments attributable to liquidity premiums, expected durations, structures and credit quality that would be applied to the market observable information of an investment.

⁽²⁾The lapse rate input represents the estimated probability of a contract surrendering during a year, and thereby forgoing any future benefits. The range for indexed annuity and IUL contracts represents the lapse rates during the surrender charge period.

⁽³⁾The utilization of guaranteed withdrawals input represents the estimated percentage of contract holders that utilize the guaranteed withdrawal feature.

⁽⁴⁾The utilization factors are applied to the present value of claims or premiums, as appropriate, in the GLB reserve calculation to estimate the impact of inefficient withdrawal behavior, including taking less than or more than the maximum guaranteed withdrawal.

⁽⁵⁾The NPR input represents the estimated additional credit spread that market participants would apply to the market observable discount rate when pricing a contract.

⁽⁶⁾The mortality rate input represents the estimated probability of when an individual belonging to a particular group, categorized according to age or some other factor such as gender, will die.

⁽⁷⁾The volatility input represents overall volatilities assumed for the underlying variable annuity funds, which include a mixture of equity and fixed-income assets. Fair value of the variable annuity GLB embedded derivatives would increase if higher volatilities were used for valuation.

⁽⁸⁾The mortality rate is based on a combination of company and industry experience, adjusted for improvement factors.