Other Revenues and Other Expenses

9 Months Ended

Sep. 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 $59 million and $173 million for the three months and nine months ended September 30, 2020, respectively, and $60 million and $179 million for the three months and nine months ended September 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 September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In millions)
Compensation	$	79	$	71	$	234	$	217
Contracted services and other labor costs	50		66		180		162
Transition services agreements	35		62		86		189
Establishment costs	40		20		133		93
Premium and other taxes, licenses and fees	10		14		33		30
Volume related costs, excluding compensation, net of DAC capitalization	147		144		419		436
Interest expense on debt	17		17		51		43
Other	91		70		190		183
Total other expenses	$	469	$	464	$	1,326	$	1,353

Related Party Expenses

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