Deferred Policy Acquisition Costs (Tables)

6 Months Ended

Jun. 30, 2023

The following tables provide the balances of and changes in deferred policy acquisition costs for the Company’s Traditional business for the six months ended June 30, 2023 and 2022 (dollars in millions):


Six months ended June 30, 2023:	U.S. and Latin America – Traditional		Canada – Traditional		Europe, Middle East and Africa – Traditional		Asia Pacific – Traditional
Balance, beginning of year	$	2,087	$	171	$	294	$	1,043
Capitalization	119		5		44		52
Amortization expense	(73)		(6)		(18)		(30)
Foreign currency translation	1		4		(2)		(15)
Balance, end of period	$	2,134	$	174	$	318	$	1,050


Six months ended June 30, 2022:	U.S. and Latin America – Traditional		Canada – Traditional		Europe, Middle East and Africa – Traditional		Asia Pacific – Traditional
Balance, beginning of year	$	1,947	$	191	$	270	$	1,056
Capitalization	131		4		39		54
Amortization expense	(71)		(7)		(19)		(37)
Foreign currency translation	—		(3)		(18)		(32)
Balance, end of period	$	2,007	$	185	$	272	$	1,041

The following tables provide the balances of and changes in deferred policy acquisition costs for the Company’s Financial Solutions business for the six months ended June 30, 2023 and 2022 (dollars in millions):


Six months ended June 30, 2023:	U.S. and Latin America – Financial Solutions		Canada – Financial Solutions		Europe, Middle East and Africa – Financial Solutions		Asia Pacific – Financial Solutions
Balance, beginning of year	$	341	$	—	$	—	$	188
Capitalization	—		—		—		116
Amortization expense	(21)		—		—		(15)
Foreign currency translation	—		—		—		(4)
Balance, end of period	$	320	$	—	$	—	$	285


Six months ended June 30, 2022:	U.S. and Latin America – Financial Solutions		Canada – Financial Solutions		Europe, Middle East and Africa – Financial Solutions		Asia Pacific – Financial Solutions
Balance, beginning of year	$	312	$	—	$	—	$	81
Capitalization	31		—		—		42
Amortization expense	(35)		—		—		(6)
Foreign currency translation	—		—		—		(1)
Balance, end of period	$	308	$	—	$	—	$	116

The reconciliation of deferred policy acquisition costs to the condensed consolidated balance sheets as of June 30, 2023 and 2022 is as follows (dollars in millions):


	June 30,
	2023		2022
Deferred policy acquisition costs included in the rollforwards:
Traditional:
U.S. and Latin America	$	2,134	$	2,007
Canada	174		185
Europe, Middle East and Africa	318		272
Asia Pacific	1,050		1,041
Financial Solutions:
U.S. and Latin America	320		308
Canada	—		—
Europe, Middle East and Africa	—		—
Asia Pacific	285		116
Other long-duration business:
Corporate and Other	5		6
Total deferred policy acquisition costs	$	4,286	$	3,935