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Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2021

Outstanding Derivative Instruments With Off-Balance-Sheet Risks



	As of March 31, 2021						As of December 31, 2020
	Notional		Fair Value				Notional		Fair Value
	Amounts		Asset		Liability		Amounts		Asset		Liability
Qualifying Hedges
Cash flow hedges:
Interest rate contracts ⁽¹⁾	$	3,112	$	7	$	324	$	2,177	$	87	$	563
Foreign currency contracts ⁽¹⁾		3,249		119		147		3,089		147		151
Total cash flow hedges		6,361		126		471		5,266		234		714
Fair value hedges:
Interest rate contracts ⁽¹⁾		1,159		-		196		1,161		-		272
Non-Qualifying Hedges
Interest rate contracts ⁽¹⁾		73,433		1,225		308		135,434		1,587		159
Foreign currency contracts ⁽¹⁾		410		4		6		304		1		8
Equity market contracts ⁽¹⁾		78,321		3,949		1,298		74,610		3,486		1,952
Credit contracts ⁽¹⁾		85		-		-		51		-		-
Embedded derivatives:
GLB direct ⁽²⁾		-		1,831		-		-		450		-
GLB ceded ⁽²⁾		-		42		152		-		82		-
Reinsurance related ⁽³⁾		-		-		244		-		-		392
Indexed annuity and IUL contracts ^{(2) (4)}		-		527		4,170		-		550		3,594
Total derivative instruments	$	159,769	$	7,704	$	6,845	$	216,826	$	6,390	$	7,091

⁽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, 2021
	Less Than		1 - 5		6 - 10		11 - 30		Over 30
	1 Year		Years		Years		Years		Years		Total
Interest rate contracts ⁽¹⁾	$	2,251	$	48,239	$	14,295	$	11,701	$	1,218	$	77,704
Foreign currency contracts ⁽²⁾		354		400		1,249		1,559		97		3,659
Equity market contracts		44,952		18,496		6,274		11		8,588		78,321
Credit contracts		-		20		65		-		-		85
Total derivative instruments
with notional amounts	$	47,557	$	67,155	$	21,883	$	13,271	$	9,903	$	159,769

⁽¹⁾As of March 31, 2021, 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, 2021, the latest maturity date for which we were hedging our exposure to the variability in future cash flows for these instruments was June 16, 2061.

Cumulative Basis Adjustments For Fair Value Hedges



							Cumulative Fair Value
							Hedging Adjustment
							Included in the
	Amortized Cost of the						Amortized Cost of the
	Hedged						Hedged
	Assets / (Liabilities)						Assets / (Liabilities)
	As of			As of			As of		As of
	March 31,			December 31,			March 31,		December 31,
	2021			2020			2021		2020
Line Item in the Consolidated Balance Sheets in
which the Hedged Item is Included
Fixed maturity AFS securities, at fair value	$	738		$	824		$	187	$	271
Long-term debt ⁽¹⁾		(815	)		(900	)		60		(25	)

⁽¹⁾The balance includes $(367) million and $(370) million of unamortized adjustments from discontinued hedges as of March 31, 2021, and December 31, 2020, respectively.

Change In Our Unrealized Gain On Derivative Instruments In Accumulated OCI



	For the Three
	Months Ended
	March 31,
	2021			2020
Unrealized Gain (Loss) on Derivative Instruments
Balance as of beginning-of-year	$	(402	)	$	(11	)
Other comprehensive income (loss):
Cash flow hedges:
Interest rate contracts		152			(383	)
Foreign currency contracts		(63	)		312
Change in foreign currency exchange rate adjustment		47			153
Change in DAC, VOBA, DSI and DFEL		14			(53	)
Income tax benefit (expense)		(30	)		(8	)
Less:
Reclassification adjustment for gains (losses)
included in net income (loss):
Cash flow hedges:
Interest rate contracts ⁽¹⁾		1			-
Interest rate contracts ⁽²⁾		(6	)		(3	)
Foreign currency contracts ⁽¹⁾		10			11
Foreign currency contracts ⁽³⁾		(2	)		1
Associated amortization of DAC, VOBA, DSI and DFEL		(1	)		(6	)
Income tax benefit (expense)		-			(1	)
Balance as of end-of-period	$	(284	)	$	8

⁽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,
	2021									2020
	Realized			Net			Interest			Realized			Net			Interest
	Gain			Investment			and Debt			Gain			Investment			and Debt
	(Loss)			Income			Expense			(Loss)			Income			Expense
Total Line Items in which the
Effects of Fair Value or Cash
Flow Hedges are Recorded	$	(181	)	$	1,510		$	65		$	(24	)	$	1,375		$	68

Qualifying Hedges
Gain or (loss) on fair value
hedging relationships:
Interest rate contracts:
Hedged items		-			(84	)		85			-			127			82
Derivatives designated as
hedging instruments		-			84			(85	)		-			(127	)		(82	)
Gain or (loss) on cash flow
hedging relationships:
Interest rate contracts:
Amount of gain or (loss)
reclassified from AOCI
into income		-			1			(6	)		-			-			(3	)
Foreign currency contracts:
Amount of gain or (loss)
reclassified from AOCI
into income		(2	)		10			-			1			11			-

Non-Qualifying Hedges
Interest rate contracts		(1,159	)		-			-			2,150			-			-
Equity market contracts		1,242			-			-			1,070			-			-
Credit contracts		-			-			-			(4	)		-			-
Embedded derivatives:
GLB		1,188			-			-			(4,369	)		-			-
Reinsurance related		148			-			-			463			-			-
Indexed annuity and IUL
contracts		(594	)		-			-			1,028			-			-

‎

Open Credit Default Swap Liabilities

As of March 31, 2021

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

12/20/2025

⁽³⁾

⁽⁴⁾

BBB+

Basket credit default swaps

6/20/2026

⁽³⁾

⁽⁴⁾

BBB+

As of December 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

12/20/2025

⁽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,
		2021			2020
Maximum potential payout		$	85		$	51
Less: Counterparty thresholds			-			-
Maximum collateral potentially required to post		$	85		$	51

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



	As of March 31, 2021					As of December 31, 2020
	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-	$	1,453	$	(197	)	$	1,233	$	(371	)
A+		1,320		(272	)		1,119		(445	)
A		60		-			53		-
A-		389		(118	)		571		(245	)
	$	3,222	$	(587	)	$	2,976	$	(1,061	)

Schedule Of Offsetting Assets And Liabilities



	As of March 31, 2021
				Embedded
	Derivative			Derivative
	Instruments			Instruments		Total

Financial Assets
Gross amount of recognized assets	$	5,680		$	2,400	$	8,080
Gross amounts offset		(1,848	)		-		(1,848	)
Net amount of assets		3,832			2,400		6,232
Gross amounts not offset:
Cash collateral		(3,222	)		-		(3,222	)
Non-cash collateral		(372	)		-		(372	)
Net amount	$	238		$	2,400	$	2,638

Financial Liabilities
Gross amount of recognized liabilities	$	866		$	4,566	$	5,432
Gross amounts offset		(4	)		-		(4	)
Net amount of liabilities		862			4,566		5,428
Gross amounts not offset:
Cash collateral		(587	)		-		(587	)
Non-cash collateral		-			-		-
Net amount	$	275		$	4,566	$	4,841



	As of December 31, 2020
				Embedded
	Derivative			Derivative
	Instruments			Instruments		Total
Financial Assets
Gross amount of recognized assets	$	4,978		$	1,082	$	6,060
Gross amounts offset		(1,869	)		-		(1,869	)
Net amount of assets		3,109			1,082		4,191
Gross amounts not offset:
Cash collateral		(2,976	)		-		(2,976	)
Non-cash collateral		(56	)		-		(56	)
Net amount	$	77		$	1,082	$	1,159

Financial Liabilities
Gross amount of recognized liabilities	$	1,456		$	3,986	$	5,442
Gross amounts offset		(330	)		-		(330	)
Net amount of liabilities		1,126			3,986		5,112
Gross amounts not offset:
Cash collateral		(1,061	)		-		(1,061	)
Non-cash collateral		-			-		-
Net amount	$	65		$	3,986	$	4,051