Other Revenues and Other Expenses

6 Months Ended

Jun. 30, 2020

Other Income and Expenses [Abstract]

Other Revenues and Other Expenses

9. Other Revenues and Other Expenses

Other Revenues

The Company has entered into contracts with mutual funds, fund managers, and their affiliates (collectively, the “Funds”) whereby the Company is paid monthly or quarterly fees (“12b-1 fees”) for providing certain services to customers and distributors of the Funds. The 12b-1 fees are generally equal to a fixed percentage of the average daily balance of the customer’s investment in a fund. The percentage is specified in the contract between the Company and the Funds. Payments are generally collected when due and are neither refundable nor able to offset future fees.

To earn these fees, the Company performs services such as responding to phone inquiries, maintaining records, providing information to distributors and shareholders about fund performance and providing training to account managers and sales agents. The passage of time reflects the satisfaction of the Company’s performance obligations to the Funds and is used to recognize revenue associated with 12b-1 fees.

Other revenues consisted primarily of 12b-1 fees of $55 million and $114 million for the three months and six months ended June 30, 2020, respectively, and $61 million and $119 million for the three months and six months ended June 30, 2019, respectively, of which substantially all were reported in the Annuities segment.

Other Expenses

Information on other expenses was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
	(In millions)
Compensation	$	82	$	73	$	155	$	146
Contracted services and other labor costs	69		56		130		96
Transition services agreements	15		63		51		127
Establishment costs	53		35		93		73
Premium and other taxes, licenses and fees	12		10		23		16
Volume related costs, excluding compensation, net of DAC capitalization	150		141		272		292
Interest expense on debt	17		16		34		26
Other	49		61		99		113
Total other expenses	$	447	$	455	$	857	$	889

Related Party Expenses

See Note 11 for a discussion of related party expenses included in the table above.