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Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Outstanding Derivative Instruments With Off-Balance-Sheet Risks



	As of March 31, 2020						As of December 31, 2019
	Notional		Fair Value				Notional		Fair Value
	Amounts		Asset		Liability		Amounts		Asset		Liability
Qualifying Hedges
Cash flow hedges:
Interest rate contracts ⁽¹⁾	$	2,397	$	334	$	853	$	2,387	$	108	$	245
Foreign currency contracts ⁽¹⁾		2,912		606		13		2,874		191		51
Total cash flow hedges		5,309		940		866		5,261		299		296
Fair value hedges:
Interest rate contracts ⁽¹⁾		1,170		-		337		1,261		123		203
Non-Qualifying Hedges
Interest rate contracts ⁽¹⁾		119,681		1,890		140		112,921		1,082		219
Foreign currency contracts ⁽¹⁾		166		11		-		262		1		3
Equity market contracts ⁽¹⁾		55,784		2,819		1,112		43,555		1,442		664
Credit contracts ⁽¹⁾		394		-		-		55		-		-
Embedded derivatives:
GLB direct ⁽²⁾		-		-		4,596		-		450		-
GLB ceded ⁽²⁾		-		728		-		-		60		9
Reinsurance related ⁽³⁾		-		137		-		-		-		327
Indexed annuity and IUL contracts ^{(2) (4)}		-		799		1,380		-		927		2,585
Total derivative instruments	$	182,504	$	7,324	$	8,431	$	163,315	$	4,384	$	4,306

⁽¹⁾Reported in derivative investments and other liabilities on our Consolidated Balance Sheets.

⁽²⁾Reported in other assets and other liabilities on our Consolidated Balance Sheets.

⁽³⁾Reported in reinsurance related embedded derivatives on our Consolidated Balance Sheets.

⁽⁴⁾Reported in future contract benefits on our Consolidated Balance Sheets.

Maturity Of The Notional Amounts Of Derivative Financial Instruments



	Remaining Life as of March 31, 2020
	Less Than		1 - 5		6 - 10		11 - 30		Over 30
	1 Year		Years		Years		Years		Years		Total
Interest rate contracts ⁽¹⁾	$	15,089	$	48,226	$	24,802	$	33,300	$	1,831	$	123,248
Foreign currency contracts ⁽²⁾		146		370		1,013		1,507		42		3,078
Equity market contracts		30,822		14,314		4,343		11		6,294		55,784
Credit contracts		-		-		394		-		-		394
Total derivative instruments
with notional amounts	$	46,057	$	62,910	$	30,552	$	34,818	$	8,167	$	182,504

⁽¹⁾As of March 31, 2020, the latest maturity date for which we were hedging our exposure to the variability in future cash flows for these instruments was April 20, 2067.

⁽²⁾As of March 31, 2020, the latest maturity date for which we were hedging our exposure to the variability in future cash flows for these instruments was June 17, 2050.

Cumulative Basis Adjustments For Fair Value Hedges


							Cumulative Fair Value
							Hedging Adjustment Included
	Amortized Cost of the						in the Amortized Cost of the
	Hedged Assets/(Liabilities)						Hedged Asset/(Liabilities)
	As of			As of			As of			As of
	March 31,			December 31,			March 31,			December 31,
	2020			2019			2020			2019
Line Item in the Consolidated Balance Sheets in
which the Hedged Item is Included
AFS fixed maturity securities, at fair value	$	890		$	776		$	328		$	202
Long-term debt ⁽¹⁾		(954	)		(1,035	)		(79	)		(160	)

⁽¹⁾The balance includes $(381) million and $(118) million of unamortized adjustments from discontinued hedges as of March 31, 2020 and December 31, 2019, respectively.

Change In Our Unrealized Gain On Derivative Instruments In Accumulated OCI



	For the Three
	Months Ended
	March 31,
	2020			2019
Unrealized Gain (Loss) on Derivative Instruments
Balance as of beginning-of-year	$	(11	)	$	139
Other comprehensive income (loss):
Cash flow hedges:
Interest rate contracts		(383	)		(47	)
Foreign currency contracts		312			11
Change in foreign currency exchange rate adjustment		153			(14	)
Change in DAC, VOBA, DSI and DFEL		(53	)		6
Income tax benefit (expense)		(8	)		10
Less:
Reclassification adjustment for gains (losses)
included in net income (loss):
Cash flow hedges:
Interest rate contracts ⁽¹⁾		-			1
Interest rate contracts ⁽²⁾		(3	)		(1	)
Foreign currency contracts ⁽¹⁾		11			7
Foreign currency contracts ⁽³⁾		1			1
Associated amortization of DAC, VOBA, DSI and DFEL		(6	)		(1	)
Income tax benefit (expense)		(1	)		(1	)
Balance as of end-of-period	$	8		$	99

⁽¹⁾The OCI offset is reported within net investment income on our Consolidated Statements of Comprehensive Income (Loss).

⁽²⁾The OCI offset is reported within interest and debt expense on our Consolidated Statements of Comprehensive Income (Loss).

⁽³⁾The OCI offset is reported within realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

Effects Of Qualifying And Non-Qualifying Hedges



		Gain (Loss) Recognized in Income
	For the Three Months Ended March 31, 2020
		Realized			Net			Interest
		Gain			Investment			and Debt
		(Loss)			Income			Expense
Total Line Items in which the Effects of Fair Value
or Cash Flow Hedges are Recorded		$	(24	)	$	1,375		$	68

Qualifying Hedges
Gain or (loss) on fair value hedging relationships:
Interest rate contracts:
Hedged items			-			127			82
Derivatives designated as hedging instruments			-			(127	)		(82	)
Gain or (loss) on cash flow hedging relationships:
Interest rate contracts:
Amount of gain or (loss) reclassified from AOCI into income			-			-			(3	)
Foreign currency contracts:
Amount of gain or (loss) reclassified from AOCI into income			1			11			-

Non-Qualifying Hedges
Interest rate contracts			2,150			-			-
Equity market contracts			1,070			-			-
Credit contracts			(4	)		-			-
Embedded derivatives:
GLB			(4,369	)		-			-
Reinsurance related			463			-			-
Indexed annuity and IUL contracts			1,028			-			-


		Gain (Loss) Recognized in Income
	For the Three Months Ended March 31, 2019
		Realized			Net			Interest
		Gain			Investment			and Debt
		(Loss)			Income			Expense
Total Line Items in which the Effects of Fair Value
or Cash Flow Hedges are Recorded		$	(362	)	$	1,251		$	71

Qualifying Hedges
Gain or (loss) on fair value hedging relationships:
Interest rate contracts:
Hedged items			-			24			(34	)
Derivatives designated as hedging instruments			-			(24	)		34
Gain or (loss) on cash flow hedging relationships:
Interest rate contracts:
Amount of gain or (loss) reclassified from AOCI into income			-			1			(1	)
Foreign currency contracts:
Amount of gain or (loss) reclassified from AOCI into income			1			7			-

Non-Qualifying Hedges
Interest rate contracts			357			-			-
Equity market contracts			(458	)		-			-
Embedded derivatives:
GLB			286			-			-
Reinsurance related			(174	)		-			-
Indexed annuity and IUL contracts			(239	)		-			-

Open Credit Default Swap Liabilities

As of March 31, 2020

Credit

Reason

Nature

Rating of

Number

Maximum

for

Underlying

Fair

Potential

Credit Contract Type

Maturity

Entering

Recourse

Obligation ⁽¹⁾

Instruments

Value ⁽²⁾

Payout

Basket credit default swaps

6/20/2025

⁽³⁾

⁽⁴⁾

BBB+

)

394

As of December 31, 2019

Credit

Reason

Nature

Rating of

Number

Maximum

for

Underlying

Fair

Potential

Credit Contract Type

Maturity

Entering

Recourse

Obligation ⁽¹⁾

Instruments

Value ⁽²⁾

Payout

Basket credit default swaps

12/20/2024

⁽³⁾

⁽⁴⁾

BBB+

⁽¹⁾Represents average credit ratings based on the midpoint of the applicable ratings among Moody’s, S&P and Fitch Ratings, as scaled to the corresponding S&P ratings.

⁽²⁾Broker quotes are used to determine the market value of our credit default swaps.

⁽³⁾Credit default swaps were entered into in order to hedge the liability exposure on certain variable annuity products.

⁽⁴⁾Sellers do not have the right to demand indemnification or compensation from third parties in case of a loss (payment) on the contract.

Collateral Support Agreements



		As of			As of
	March 31,			December 31,
		2020			2019
Maximum potential payout		$	394		$	55
Less: Counterparty thresholds			-			-
Maximum collateral potentially required to post		$	394		$	55

Schedule Of Collateral Amounts With Rights To Reclaim Or Obligation To Return Cash



	As of March 31, 2020					As of December 31, 2019
	Collateral		Collateral			Collateral		Collateral
	Posted by		Posted by			Posted by		Posted by
S&P	Counter-		LNC			Counter-		LNC
Credit	Party		(Held by			Party		(Held by
Rating of	(Held by		Counter-			(Held by		Counter-
Counterparty	LNC)		Party)			LNC)		Party)
AA-	$	521	$	(599	)	$	441	$	(167	)
A+		2,674		(493	)		555		(339	)
A		35		-			36		-
A-		712		(397	)		355		(51	)
BBB+		-		-			-		-
	$	3,942	$	(1,489	)	$	1,387	$	(557	)

Schedule Of Offsetting Assets And Liabilities



		As of March 31, 2020
					Embedded
	Derivative				Derivative
	Instruments				Instruments			Total

Financial Assets
Gross amount of recognized assets		$	5,634			$	1,664	$	7,298
Gross amounts offset			(1,217	)			-		(1,217	)
Net amount of assets			4,417				1,664		6,081
Gross amounts not offset:
Cash collateral			(3,942	)			-		(3,942	)
Non-cash collateral			(151	)			-		(151	)
Net amount		$	324			$	1,664	$	1,988

Financial Liabilities
Gross amount of recognized liabilities		$	1,688			$	5,976	$	7,664
Gross amounts offset			(25	)			-		(25	)
Net amount of liabilities			1,663				5,976		7,639
Gross amounts not offset:
Cash collateral			(1,489	)			-		(1,489	)
Non-cash collateral			-				-		-
Net amount		$	174			$	5,976	$	6,150

‎


		As of December 31, 2019
					Embedded
	Derivative				Derivative
	Instruments				Instruments			Total

Financial Assets
Gross amount of recognized assets		$	2,619			$	1,437	$	4,056
Gross amounts offset			(708	)			-		(708	)
Net amount of assets			1,911				1,437		3,348
Gross amounts not offset:
Cash collateral			(1,387	)			-		(1,387	)
Non-cash collateral			(242	)			-		(242	)
Net amount		$	282			$	1,437	$	1,719

Financial Liabilities
Gross amount of recognized liabilities		$	1,005			$	2,921	$	3,926
Gross amounts offset			(138	)			-		(138	)
Net amount of liabilities			867				2,921		3,788
Gross amounts not offset:
Cash collateral			(557	)			-		(557	)
Non-cash collateral			-				-		-
Net amount		$	310			$	2,921	$	3,231