SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2024

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

FLIAC has two reportable segments, which we refer to as the "Retained Business" and the "Ceded Business."

The Retained Business consists of variable annuity products with guaranteed lifetime withdrawal benefit features as well as smaller blocks of variable annuity products with certain other living benefit and death benefit features. The Retained Business also includes variable universal life and fixed payout annuity products. The Retained Business is actively managed by FLIAC management and we retain the full economic benefits and risks.

The Ceded Business represents certain business (primarily registered index-linked annuities and fixed annuities, which includes fixed indexed and fixed deferred annuities, and other variable annuities) where 100 percent of the assets and liabilities have been fully ceded to Prudential Insurance and Pruco Life under existing coinsurance and modified coinsurance agreements. At June 30, 2024 and December 31, 2023, we had a modified coinsurance payable of $1,726 million and $1,603 million, respectively, equal to the assets held in the Ceded Business, and are included in the net modified coinsurance payable.

The following is the Consolidated Statement of Financial Position by segment:

	June 30, 2024
	Retained Business		Ceded Business		Total
	(in millions)
ASSETS
Total investments	$	4,550	$	1,645	$	6,195
Cash and cash equivalents	294		85		379
Accrued investment income	53		12		65
Reinsurance recoverables	—		151		151
Deposit asset	—		404		404
Income taxes	78		—		78
Other assets	47		1		48
Separate account assets	21,598		2,077		23,675
TOTAL ASSETS	$	26,620	$	4,375	$	30,995
LIABILITIES AND EQUITY
LIABILITIES
Insurance liabilities	$	2,233	$	2,153	$	4,386
Net modified coinsurance payable	—		128		128
Liabilities associated with secured borrowing arrangements	1,121		2		1,123
Other liabilities	303		15		318
Separate account liabilities	21,598		2,077		23,675
TOTAL LIABILITIES	25,255		4,375		29,630
EQUITY	1,365		—		1,365
TOTAL LIABILITIES AND EQUITY	$	26,620	$	4,375	$	30,995

    

	December 31, 2023
	Retained Business		Ceded Business		Total
	(in millions)
ASSETS
Total investments	$	4,680	$	1,199	$	5,879
Cash and cash equivalents	534		406		940
Accrued investment income	51		9		60
Reinsurance recoverables	—		206		206
Deposit asset	—		438		438
Income taxes	99		—		99
Other assets	61		—		61
Separate account assets	21,800		2,070		23,870
TOTAL ASSETS	$	27,225	$	4,328	$	31,553
LIABILITIES AND EQUITY
LIABILITIES
Insurance liabilities	$	2,835	$	2,168	$	5,003
Net modified coinsurance payable	—		78		78
Liabilities associated with secured borrowing arrangements	967		—		967
Other liabilities	261		12		273
Separate account liabilities	21,800		2,070		23,870
TOTAL LIABILITIES	25,863		4,328		30,191
EQUITY	1,362		—		1,362
TOTAL LIABILITIES AND EQUITY	$	27,225	$	4,328	$	31,553

The following is comprehensive income by segment:

	Three Months Ended June 30, 2024
	Retained Business		Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	8	$	—	$	8
Policy charges and fee income	113		—		113
Net investment income	59		16		75
Asset management and service fees	23		—		23
Investment gains (losses), net	(179)		32		(147)
TOTAL REVENUES	24		48		72
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	14		48		62
Commission expense	23		—		23
General, administrative and other expenses	20		—		20
TOTAL BENEFITS AND EXPENSES	57		48		105
LOSS FROM OPERATIONS BEFORE INCOME TAXES	(33)		—		(33)
Less: Income tax benefit	(3)		—		(3)
NET LOSS	$	(30)	$	—	$	(30)
Other comprehensive income, before tax:
Changes in own-credit risk related to insurance liabilities	61		—		61
Less: Income tax expense	13		—		13
Other comprehensive income, net of taxes	48		—		48
COMPREHENSIVE INCOME	$	18	$	—	$	18

	Six Months Ended June 30, 2024
	Retained Business		Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	18	$	—	$	18
Policy charges and fee income	225		—		225
Net investment income	115		30		145
Asset management and service fees	46		—		46
Other income	2		—		2
Investment gains (losses), net	(604)		136		(468)
TOTAL REVENUES	(198)		166		(32)
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	(418)		166		(252)
Commission expense	46		—		46
General, administrative and other expenses	38		—		38
TOTAL BENEFITS AND EXPENSES	(334)		166		(168)
INCOME FROM OPERATIONS BEFORE INCOME TAXES	136		—		136
Less: Income tax expense	21		—		21
NET INCOME	$	115	$	—	$	115
Other comprehensive income, before tax:
Changes in own-credit risk related to insurance liabilities	48		—		48
Less: Income tax expense	10		—		10
Other comprehensive income, net of taxes	38		—		38
COMPREHENSIVE INCOME	$	153	$	—	$	153

	Three Months Ended June 30, 2023
	Retained Business			Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	7		$	—	$	7
Policy charges and fee income	115			—		115
Net investment income	58			20		78
Asset management and service fees	23			—		23
Other income	2			1		3
Investment gains (losses), net	(402)			115		(287)
TOTAL REVENUES	(197)			136		(61)
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	(391)		—	136		(255)
Commission expense	23			—		23
General, administrative and other expenses	16			—		16
TOTAL BENEFITS AND EXPENSES	(352)			136		(216)
INCOME FROM OPERATIONS BEFORE INCOME TAXES	155			—		155
Less: Income tax expense	25			—		25
NET INCOME	$	130		$	—	$	130
Other comprehensive loss, before tax:
Changes in own-credit risk related to insurance liabilities	(115)			—		(115)
Less: Income tax benefit	(25)			—		(25)
Other comprehensive loss, net of taxes	(90)			—		(90)
COMPREHENSIVE INCOME	$	40		$	—	$	40

	Six Months Ended June 30, 2023
	Retained Business		Ceded Business		Total
	(in millions)
REVENUES
Premiums	$	14	$	—	$	14
Policy charges and fee income	232		—		232
Net investment income	114		40		154
Asset management and service fees	45		—		45
Other income	3		1		4
Investment gains (losses), net	(372)		250		(122)
TOTAL REVENUES	36		291		327
BENEFITS AND EXPENSES
Policyholder benefits and changes in fair value of insurance liabilities	(206)		291		85
Commission expense	46		—		46
General, administrative and other expenses	34		—		34
TOTAL BENEFITS AND EXPENSES	(126)		291		165
INCOME FROM OPERATIONS BEFORE INCOME TAXES	162		—		162
Less: Income tax expense	25		—		25
NET INCOME	$	137	$	—	$	137
Other comprehensive loss, before tax:
Changes in own-credit risk related to insurance liabilities	(93)		—		(93)
Less: Income tax benefit	(20)		—		(20)
Other comprehensive loss, net of taxes	(73)		—		(73)
COMPREHENSIVE INCOME	$	64	$	—	$	64