Investments (Tables)

12 Months Ended

Dec. 31, 2017

Investments, Debt and Equity Securities [Abstract]

Fixed Maturity and Equity Securities Available-for-Sale

The following table presents the fixed maturity and equity securities AFS by sector at:

	December 31, 2017											December 31, 2016
	Cost or Amortized Cost		Gross Unrealized							Estimated Fair Value		Cost or Amortized Cost		Gross Unrealized							Estimated Fair Value
			Gains		Temporary Losses		OTTI Losses (1)							Gains		Temporary Losses		OTTI Losses (1)
										(In millions)
Fixed maturity securities: (2)
U.S. corporate	$	20,647	$	1,822	$	89	$	—		$	22,380	$	20,663	$	1,287	$	285	$	—		$	21,665
U.S. government and agency	14,185		1,844		116		—			15,913		11,872		1,281		237		—			12,916
RMBS	7,588		283		57		(3		)	7,817		7,876		203		139		—			7,940
Foreign corporate	6,457		376		62		—			6,771		6,071		220		168		—			6,123
State and political subdivision	3,573		532		6		1			4,098		3,520		376		38		—			3,858
CMBS	3,259		48		17		(1		)	3,291		3,687		40		32		(1		)	3,696
ABS	1,779		19		2		—			1,796		2,600		11		13		—			2,598
Foreign government	1,111		159		3		—			1,267		1,000		114		11		—			1,103
Total fixed maturity securities	$	58,599	$	5,083	$	352	$	(3	)	$	63,333	$	57,289	$	3,532	$	923	$	(1	)	$	59,899
Equity securities (2)	$	212	$	21	$	1	$	—		$	232	$	280	$	29	$	9	$	—		$	300

______________

(1) Noncredit OTTI losses included in AOCI in an unrealized gain position are due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. See also “— Net Unrealized Investment Gains (Losses).”

(2) Redeemable preferred stock is reported within U.S. corporate and foreign corporate fixed maturity securities and non-redeemable preferred stock is reported within equity securities. Included within fixed maturity securities are Structured Securities.

Available-for-sale fixed maturity securities by contractual maturity date

The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at December 31, 2017:

	Due in One Year or Less		Due After One Year Through Five Years		Due After Five Years Through Ten Years		Due After Ten Years		Structured Securities		Total Fixed Maturity Securities
	(In millions)
Amortized cost	$	1,833	$	10,018	$	11,131	$	22,991	$	12,626	$	58,599
Estimated fair value	$	1,838	$	10,347	$	11,458	$	26,786	$	12,904	$	63,333

Continuous Gross Unrealized Loss and OTTI Loss for Fixed Maturity and Equity Securities Available-for-Sale

The following table presents the estimated fair value and gross unrealized losses of fixed maturity and equity securities AFS in an unrealized loss position, aggregated by sector and by length of time that the securities have been in a continuous unrealized loss position at:

	December 31, 2017								December 31, 2016
	Less than 12 Months				Equal to or Greater than 12 Months				Less than 12 Months				Equal to or Greater than 12 Months
	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
	(Dollars in millions)
Fixed maturity securities:
U.S. corporate	$	1,762	$	21	$	1,413	$	68	$	4,632	$	187	$	699	$	98
U.S. government and agency	4,764		36		1,573		80		4,396		237		—		—
RMBS	2,308		13		1,292		41		3,457		107		818		32
Foreign corporate	636		8		559		54		1,443		64		573		104
State and political subdivision	171		3		106		4		887		35		29		3
CMBS	603		6		335		10		1,553		26		171		5
ABS	165		—		75		2		450		5		461		8
Foreign government	152		2		50		1		242		10		6		1
Total fixed maturity securities	$	10,561	$	89	$	5,403	$	260	$	17,060	$	671	$	2,757	$	251
Equity securities:	$	17	$	—	$	10	$	1	$	57	$	2	$	40	$	7
Total number of securities in an unrealized loss position	914				623				1,711				475

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Mortgage loans are summarized as follows at:

	December 31,
	2017					2016
	Carrying Value			% of Total		Carrying Value			% of Total
	(Dollars in millions)
Mortgage loans:
Commercial	$	7,233		67.9	%	$	6,497		69.9	%
Agricultural	2,200			20.7		1,830			19.7
Residential	1,138			10.7		867			9.3
Subtotal (1)	10,571			99.3		9,194			98.9
Valuation allowances (2)	(46		)	(0.4	)	(40		)	(0.4	)
Subtotal mortgage loans, net	10,525			98.9		9,154			98.5
Commercial mortgage loans held by CSEs — FVO	115			1.1		136			1.5
Total mortgage loans, net	$	10,640		100.0	%	$	9,290		100.0	%

(1) The Company purchases unaffiliated mortgage loans under a master participation agreement from a former affiliate, simultaneously with the former affiliate’s origination or acquisition of mortgage loans. The aggregate amount of unaffiliated mortgage loan participation interests purchased by the Company from the former affiliate during the years ended December 31, 2017, 2016 and 2015 were $1.2 billion, $2.4 billion and $2.0 billion, respectively. In connection with the mortgage loan participations, the former affiliate collected mortgage loan principal and interest payments on the Company’s behalf and the former affiliate remitted such payments to the Company in the amount of $945 million, $1.6 billion and $1.0 billion during the years ended December 31, 2017, 2016 and 2015, respectively.

Purchases of mortgage loans from third parties were $420 million and $619 million for the years ended December 31, 2017 and 2016, respectively, and were primarily comprised of residential mortgage loans.

(2) The valuation allowances were primarily from collective evaluation (non-specific loan related).

Investment in leveraged leases

Investment in leveraged leases consisted of the following at:

	December 31,
	2017			2016
	(In millions)
Rental receivables, net	$	87		$	87
Estimated residual values	14			14
Subtotal	101			101
Unearned income	(35		)	(32		)
Investment in leveraged leases, net of non-recourse debt	$	66		$	69

Components of net unrealized investment gains (losses) included in accumulated other comprehensive income (loss)

The components of net unrealized investment gains (losses), included in AOCI, were as follows:

	Years Ended December 31,
	2017			2016			2015
	(In millions)
Fixed maturity securities	$	4,722		$	2,600		$	2,283
Fixed maturity securities with noncredit OTTI losses included in AOCI	2			1			(23		)
Total fixed maturity securities	4,724			2,601			2,260
Equity securities	39			32			54
Derivatives	231			397			370
Short-term investments	—			(42		)	—
Other	(8		)	59			79
Subtotal	4,986			3,047			2,763
Amounts allocated from:
Future policy benefits	(2,370		)	(922		)	(126		)
DAC and VOBA related to noncredit OTTI losses recognized in AOCI	(2		)	(2		)	(1		)
DAC, VOBA and DSI	(260		)	(193		)	(198		)
Subtotal	(2,632		)	(1,117		)	(325		)
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI	1			—			9
Deferred income tax benefit (expense)	(495		)	(653		)	(827		)
Net unrealized investment gains (losses)	$	1,860		$	1,277		$	1,620

The changes in net unrealized investment gains (losses) were as follows:

	Years Ended December 31,
	2017			2016			2015
	(In millions)
Balance at January 1,	$	1,277		$	1,620		$	2,628
Fixed maturity securities on which noncredit OTTI losses have been recognized	1			24			15
Unrealized investment gains (losses) during the year	1,938			260			(2,303		)
Unrealized investment gains (losses) relating to:
Future policy benefits	(1,448		)	(796		)	487
DAC and VOBA related to noncredit OTTI losses recognized in AOCI	—			(1		)	1
DAC, VOBA and DSI	(67		)	5			208
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI	1			(9		)	(5		)
Deferred income tax benefit (expense)	158			174			589
Balance at December 31,	$	1,860		$	1,277		$	1,620
Change in net unrealized investment gains (losses)	$	583		$	(343	)	$	(1,008	)

Securities Lending

Elements of the securities lending program are presented below at:

	December 31,
	2017		2016
	(In millions)
Securities on loan: (1)
Amortized cost	$	3,085	$	5,895
Estimated fair value	$	3,748	$	6,555
Cash collateral received from counterparties (2)	$	3,791	$	6,642
Security collateral received from counterparties (3)	$	29	$	27
Reinvestment portfolio — estimated fair value	$	3,823	$	6,571

______________

(1) Included within fixed maturity securities.

(2) Included within payables for collateral under securities loaned and other transactions.

(3) Security collateral received from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected on the consolidated financial statements.

The cash collateral liability by loaned security type and remaining tenor of the agreements were as follows at:

	December 31, 2017								December 31, 2016
	Remaining Tenor of Securities Lending Agreements								Remaining Tenor of Securities Lending Agreements
	Open (1)		1 Month or Less		1 to 6 Months		Total		Open (1)		1 Month or Less		1 to 6 Months		Total
	(In millions)
Cash collateral liability by loaned security type:
U.S. government and agency	$	1,626	$	964	$	1,201	$	3,791	$	2,129	$	1,906	$	1,743	$	5,778
U.S. corporate	—		—		—		—		—		480		—		480
Agency RMBS	—		—		—		—		—		—		274		274
Foreign corporate	—		—		—		—		—		58		—		58
Foreign government	—		—		—		—		—		52		—		52
Total	$	1,626	$	964	$	1,201	$	3,791	$	2,129	$	2,496	$	2,017	$	6,642

_____________

(1) The related loaned security could be returned to the Company on the next business day which would require the Company to immediately return the cash collateral.

Invested Assets on Deposit, Held in Trust and Pledged as Collateral

Brighthouse Life Insurance Company has also entered into funding agreements with FHLBs. The liabilities for these funding agreements are included in policyholder account balances. Information related to FHLB funding agreements was as follows at:

	December 31,
	2017		2016
	(In millions)
Liabilities	$	595	$	645

Invested assets on deposit, held in trust and pledged as collateral are presented below at estimated fair value at:

	December 31,
	2017		2016
	(In millions)
Invested assets on deposit (regulatory deposits) (1)	$	8,259	$	7,644
Invested assets held in trust (reinsurance agreements) (2)	2,634		9,054
Invested assets pledged as collateral (3)	3,199		3,548
Total invested assets on deposit, held in trust, and pledged as collateral	$	14,092	$	20,246

__________________

(1) The Company has assets, primarily fixed maturity securities, on deposit with governmental authorities relating to certain policy holder liabilities, of which $34 million of the assets on deposit balance represents restricted cash at both December 31, 2017 and 2016.

(2) The Company has assets, primarily fixed maturity securities, held in trust relating to certain reinsurance transactions. $42 million and $15 million of the assets held in trust balance represents restricted cash at December 31, 2017 and 2016, respectively.

(3) The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Note 4) and derivative transactions (see Note 8).

Purchased credit impaired investments, by invested asset class, held

The following table presents activity for the accretable yield on PCI fixed maturity securities for:

	Years Ended December 31,
	2017			2016
	(In millions)
Accretable yield, January 1,	$	419		$	400
Investments purchased	1			142
Accretion recognized in earnings	(67		)	(66		)
Disposals	(10		)	(8		)
Reclassification (to) from nonaccretable difference	34			(49		)
Accretable yield, December 31,	$	377		$	419

The following table presents information about PCI fixed maturity securities acquired during the periods indicated:

	Years Ended December 31,
	2017		2016
	(In millions)
Contractually required payments (including interest)	$	3	$	558
Cash flows expected to be collected (1)	$	3	$	483
Fair value of investments acquired	$	2	$	341

______________

(1) Represents undiscounted principal and interest cash flow expectations, at the date of acquisition.

The Company’s PCI fixed maturity securities were as follows at:

	December 31,
	2017		2016
	(In millions)
Outstanding principal and interest balance (1)	$	1,237	$	1,458
Carrying value (2)	$	1,020	$	1,113

______________

(1) Represents the contractually required payments, which is the sum of contractual principal, whether or not currently due, and accrued interest.

(2) Estimated fair value plus accrued interest.

The Components of Net Investment Income

The components of net investment income were as follows:

	Years Ended December 31,
	2017		2016		2015
	(In millions)
Investment income:
Fixed maturity securities	$	2,347	$	2,567	$	2,398
Equity securities	12		19		19
Mortgage loans	442		393		367
Policy loans	49		54		54
Real estate and real estate joint ventures	53		32		108
Other limited partnership interests	182		163		134
Cash, cash equivalents and short-term investments	30		20		9
Other	25		25		22
Subtotal	3,140		3,273		3,111
Less: Investment expenses	175		173		126
Subtotal, net	2,965		3,100		2,985
FVO CSEs — interest income — commercial mortgage loans	8		11		16
Net investment income	$	2,973	$	3,111	$	3,001

The components of net investment gains (losses)

The components of net investment gains (losses) were as follows:

	Years Ended December 31,
	2017			2016			2015
	(In millions)
Total gains (losses) on fixed maturity securities:
Total OTTI losses recognized — by sector and industry:
U.S. and foreign corporate securities — by industry:
Industrial	$	—		$	(16	)	$	(3	)
Consumer	—			—			(8		)
Utility	—			—			(6		)
Total U.S. and foreign corporate securities	—			(16		)	(17		)
RMBS	—			(6		)	(14		)
State and political subdivision	(1		)	—			—
OTTI losses on fixed maturity securities recognized in earnings	(1		)	(22		)	(31		)
Fixed maturity securities — net gains (losses) on sales and disposals	(25		)	(28		)	(60		)
Total gains (losses) on fixed maturity securities	(26		)	(50		)	(91		)
Total gains (losses) on equity securities:
OTTI losses on equity securities recognized in earnings	(4		)	(2		)	(3		)
Equity securities — net gains (losses) on sales and disposals	26			10			18
Total gains (losses) on equity securities	22			8			15
Mortgage loans	(9		)	5			(11		)
Real estate and real estate joint ventures	4			(34		)	98
Other limited partnership interests	(11		)	(7		)	(1		)
Other	(4		)	11			(2		)
Subtotal	(24		)	(67		)	8
FVO CSEs:
Commercial mortgage loans	(3		)	(2		)	(7		)
Long-term debt - related to commercial mortgage loans	1			1			4
Non-investment portfolio gains (losses)	(1		)	1			—
Subtotal	(3		)	—			(3		)
Total net investment gains (losses)	$	(27	)	$	(67	)	$	5

Proceeds from sales or disposals of fixed maturity and equity securities and the components of fixed maturity and equity securities net investment gains and losses

Proceeds from sales or disposals of fixed maturity and equity securities and the components of fixed maturity and equity securities net investment gains (losses) were as shown in the table below.

	Years Ended December 31,
	2017			2016			2015			2017			2016			2015
	Fixed Maturity Securities									Equity Securities
	(In millions)
Proceeds	$	11,974		$	39,210		$	32,085		$	68		$	48		$	80
Gross investment gains	$	58		$	253		$	184		$	27		$	10		$	26
Gross investment losses	(83		)	(281		)	(244		)	(1		)	—			(8		)
OTTI losses	(1		)	(22		)	(31		)	(4		)	(2		)	(3		)
Net investment gains (losses)	$	(26	)	$	(50	)	$	(91	)	$	22		$	8		$	15

Rollforward of the Cumulative Credit Loss Component of OTTI income (loss)

The table below presents a rollforward of the cumulative credit loss component of OTTI loss recognized in earnings on fixed maturity securities still held for which a portion of the OTTI loss was recognized in OCI:

	Years Ended December 31,
	2017			2016
	(In millions)
Balance at January 1,	$	28		$	66
Additions:
Additional impairments — credit loss OTTI on securities previously impaired	—			5
Reductions:
Sales (maturities, pay downs or prepayments) of securities previously impaired as credit loss OTTI	(28		)	(42		)
Increase in cash flows — accretion of previous credit loss OTTI	—			(1		)
Balance at December 31,	$	—		$	28

Schedule of Invested Assets Transferred To and From Affiliates

The Company previously transferred fixed maturity securities, mortgage loans, real estate and real estate joint ventures, to and from former affiliates, which were as follows:

	Years Ended December 31,
	2017			2016		2015
	(In millions)
Estimated fair value of invested assets transferred to former affiliates	$	292		$	1,495	$	185
Amortized cost of invested assets transferred to former affiliates	$	294		$	1,400	$	169
Net investment gains (losses) recognized on transfers	$	(2	)	$	27	$	16
Change in additional paid-in-capital recognized on transfers	$	—		$	68	$	—
Estimated fair value of invested assets transferred from former affiliates	$	—		$	5,582	$	928

Variable Interest Entity, Primary Beneficiary [Member]

Variable Interest Entity [Line Items]

Variable Interest Entities

The following table presents the total assets and total liabilities relating to VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated at:

	December 31,
	2017		2016
	(In millions)
MRSC (collateral financing arrangement ) (1)	$	—	$	3,422
CSEs: (2)
Assets:
Mortgage loans (commercial mortgage loans)	115		136
Accrued investment income	1		1
Total assets	$	116	$	137
Liabilities:
Long-term debt	$	11	$	23
Other liabilities	—		1
Total liabilities	$	11	$	24

______________

(1) In April 2017, these assets were liquidated and the proceeds were used to repay the MRSC collateral financing arrangement (see Note 3).

(2) The Company consolidates entities that are structured as CMBS. The assets of these entities can only be used to settle their respective liabilities, and under no circumstances is the Company liable for any principal or interest shortfalls should any arise. The Company’s exposure was limited to that of its remaining investment in these entities of $86 million and $95 million at estimated fair value at December 31, 2017 and 2016, respectively.

Variable Interest Entity, Not Primary Beneficiary [Member]

Variable Interest Entity [Line Items]

Variable Interest Entities

The carrying amount and maximum exposure to loss relating to VIEs in which the Company holds a significant variable interest but is not the primary beneficiary and which have not been consolidated were as follows at:

	December 31,
	2017				2016
	Carrying Amount		Maximum Exposure to Loss (1)		Carrying Amount		Maximum Exposure to Loss (1)
	(In millions)
Fixed maturity securities AFS:
Structured Securities (2)	$	11,136	$	11,136	$	12,809	$	12,809
U.S. and foreign corporate	501		501		536		536
Other limited partnership interests	1,509		2,460		1,491		2,287
Real estate joint ventures	24		27		17		22
Other investments (3)	47		52		60		66
Total	$	13,217	$	14,176	$	14,913	$	15,720

______________

(1) The maximum exposure to loss relating to fixed maturity and equity securities AFS is equal to their carrying amounts or the carrying amounts of retained interests. The maximum exposure to loss relating to other limited partnership interests and real estate joint ventures is equal to the carrying amounts plus any unfunded commitments. Such a maximum loss would be expected to occur only upon bankruptcy of the issuer or investee.

(2) For these variable interests, the Company’s involvement is limited to that of a passive investor in mortgage-backed or asset-backed securities issued by trusts that do not have substantial equity.

(3) Other investments are comprised of other invested assets and non-redeemable preferred stock.

Commercial

Mortgage Loans on Real Estate [Line Items]

Disclosure of the mortgage loans portfolio segment by the recorded investment, prior to valuation allowances, by credit quality indicator categories

The credit quality of commercial mortgage loans was as follows at:

	Recorded Investment										Estimated Fair Value		% of Total
	Debt Service Coverage Ratios						Total		% of Total
	> 1.20x		1.00x - 1.20x		< 1.00x
	(Dollars in millions)
December 31, 2017
Loan-to-value ratios:
Less than 65%	$	6,167	$	293	$	33	$	6,493	89.7	%	$	6,654	90.0	%
65% to 75%	642		—		14		656		9.1		658		8.9
76% to 80%	42		—		9		51		0.7		50		0.7
Greater than 80%	—		9		24		33		0.5		30		0.4
Total	$	6,851	$	302	$	80	$	7,233	100.0	%	$	7,392	100.0	%
December 31, 2016
Loan-to-value ratios:
Less than 65%	$	5,718	$	230	$	167	$	6,115	94.1	%	$	6,197	94.3	%
65% to 75%	291		—		19		310		4.8		303		4.6
76% to 80%	34		—		—		34		0.5		33		0.5
Greater than 80%	24		14		—		38		0.6		37		0.6
Total	$	6,067	$	244	$	186	$	6,497	100.0	%	$	6,570	100.0	%

Agricultural

Mortgage Loans on Real Estate [Line Items]

Disclosure of the mortgage loans portfolio segment by the recorded investment, prior to valuation allowances, by credit quality indicator categories

The credit quality of agricultural mortgage loans was as follows at:

	December 31,
	2017				2016
	Recorded Investment		% of Total		Recorded Investment		% of Total
	(Dollars in millions)
Loan-to-value ratios:
Less than 65%	$	2,039	92.7	%	$	1,789	97.8	%
65% to 75%	161		7.3		41		2.2
Total	$	2,200	100.0	%	$	1,830	100.0	%

Residential

Mortgage Loans on Real Estate [Line Items]

Disclosure of the mortgage loans portfolio segment by the recorded investment, prior to valuation allowances, by credit quality indicator categories

The credit quality of residential mortgage loans was as follows at:

	December 31,
	2017				2016
	Recorded Investment		% of Total		Recorded Investment		% of Total
	(Dollars in millions)
Performance indicators:
Performing	$	1,106	97.2	%	$	856	98.7	%
Nonperforming	32		2.8		11		1.3
Total	$	1,138	100.0	%	$	867	100.0	%