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Fair Value of Assets and Liabilities Fair Value of Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2024

Schedule Of Fair Value Assets and Liabilities Measured on Recurring Basis Table Text Block

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 are summarized below (dollars in millions):


March 31, 2024:			Fair Value Measurements Using:
	Total		Level 1		Level 2		Level 3
Assets: (1)
Fixed maturity securities available-for-sale:
Corporate	$	41,048	$	—	$	35,969	$	5,079
Canadian government	3,713		—		3,713		—
Japanese government	5,204		—		5,204		—
ABS	4,945		—		3,580		1,365
CMBS	1,861		—		1,829		32
RMBS	1,150		—		1,149		1
U.S. government	2,786		2,694		86		6
State and political subdivisions	1,116		—		1,095		21
Other foreign government	4,004		—		3,971		33
Total fixed maturity securities available-for-sale	65,827		2,694		56,596		6,537
Equity securities	144		75		—		69
Funds withheld at interest – embedded derivatives	(284)		—		—		(284)
Funds withheld at interest	55		—		—		55
Cash equivalents	2,698		2,698		—		—
Short-term investments	280		178		92		10
Other invested assets:
Derivatives	70		—		70		—

Other	20		—		20		—
Total other invested assets	90		—		90		—

Total	$	68,810	$	5,645	$	56,778	$	6,387
Liabilities:
Interest-sensitive contract liabilities – embedded derivatives	$	398	$	—	$	—	$	398
Funds withheld at interest – embedded derivatives	(190)		—		—		(190)
Derivatives – other liabilities	294		—		294		—
Total	$	502	$	—	$	294	$	208

(1)Excludes limited partnerships that are measured at estimated fair value using the NAV per share (or its equivalent) as a practical expedient. As of March 31, 2024, the fair value of such investments was $893 million.


December 31, 2023:			Fair Value Measurements Using:
	Total		Level 1		Level 2		Level 3
Assets: (1)
Fixed maturity securities available-for-sale:
Corporate	$	38,755	$	—	$	33,822	$	4,933
Canadian government	3,917		—		3,917		—
Japanese government	3,131		—		3,131		—
ABS	4,429		—		3,064		1,365
CMBS	1,773		—		1,714		59
RMBS	1,079		—		1,078		1
U.S. government	2,520		2,426		87		7
State and political subdivisions	1,114		—		1,095		19
Other foreign government	3,749		—		3,714		35
Total fixed maturity securities available-for-sale	60,467		2,426		51,622		6,419
Equity securities	139		69		—		70
Funds withheld at interest – embedded derivatives	(377)		—		—		(377)
Funds withheld at interest	54		—		—		54
Cash equivalents	1,335		1,322		13		—
Short-term investments	187		90		95		2
Other invested assets:
Derivatives	97		—		97		—
Other	22		—		22		—


Total other invested assets	119		—		119		—
Total	$	61,924	$	3,907	$	51,849	$	6,168
Liabilities:
Interest-sensitive contract liabilities – embedded derivatives	$	415	$	—	$	—	$	415
Funds withheld at interest – embedded derivatives	(206)		—		—		(206)
Derivatives – other liabilities	197		—		197		—
Total	$	406	$	—	$	197	$	209

(1)Excludes limited partnerships that are measured at estimated fair value using the NAV per share (or its equivalent) as a practical expedient. As of December 31, 2023, the fair value of such investments was $856 million.

Fair Value Measurement Inputs and Valuation Techniques [Table Text Block]

The following table presents quantitative information about significant unobservable inputs used in Level 3 fair value measurements that are developed internally by the Company as of March 31, 2024 and December 31, 2023 (dollars in millions):


	Estimated Fair Value				Valuation Technique	Unobservable Input	Range (Weighted Average)
	March 31, 2024		December 31, 2023				March 31, 2024	December 31, 2023
Assets:
Corporate	$	160	$	91	Market comparable securities	Liquidity premium	0-2% (1%)	0-2% (1%)
						EBITDA Multiple	6.7x-11.0x (8.9x)	6.0x-8.5x (7.1x)
ABS	292		268		Market comparable securities	Liquidity premium	0-9% (2%)	0-18% (2%)
U.S. government	6		7		Market comparable securities	Liquidity premium	0-1% (1%)	0-1% (1%)


Equity securities	29		31		Market comparable securities	Liquidity premium	4%	4%
						EBITDA Multiple	6.9x-12.4x (10.4x)	8.4x-12.3x (10.1x)
Funds withheld at interest – embedded derivatives	6		(50)		Total return swap	Mortality	0-100% (3%)	0-100% (3%)
						Lapse	0-35% (18%)	0-35% (18%)
						Withdrawal	0-10% (4%)	0-5% (4%)
						CVA	0-5% (0%)	0-5% (0%)
						Crediting rate	1-4% (2%)	1-4% (2%)


Liabilities:
Interest-sensitive contract liabilities – embedded derivatives – indexed annuities	398		415		Discounted cash flow	Mortality	0-100% (3%)	0-100% (3%)
						Lapse	0-35% (17%)	0-35% (17%)
						Withdrawal	0-10% (4%)	0-5% (4%)
						Option budget projection	1-4% (2%)	1-4% (2%)

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]


For the three months ended March 31, 2024:	Fixed maturity securities available-for-sale														Funds withheld at interest –embedded derivatives, net (1)		Funds withheld at interest		Interest-sensitive contract liabilities – embedded derivatives
	Corporate		Foreign govt		Structured securities		U.S. and local govt		Equity securities		Cash equivalents		Short-term investments
Fair value, beginning of period	$	4,933	$	35	$	1,425	$	26	$	70	$	—	$	2	$	(171)	$	54	$	(415)
Total gains/losses (realized/unrealized)
Included in earnings, net:
Net investment income	2		—		1		—		—		—		—		—		2		—
Investment related gains (losses), net	(24)		—		(2)		—		(3)		—		—		77		—		—



Interest credited	—		—		—		—		—		—		—		—		—		(20)
Included in other comprehensive income (loss)	11		(2)		2		—		—		—		—		—		(1)		—

Purchases (2)	428		—		46		—		2		—		8		—		1		12
Sales (2)	(119)		—		(23)		—		—		—		—		—		—		—
Settlements (2)	(118)		—		(60)		(1)		—		—		—		—		(1)		25
Transfers into Level 3	—		—		30		2		—		—		—		—		—		—
Transfers out of Level 3	(34)		—		(21)		—		—		—		—		—		—		—
Fair value, end of period	$	5,079	$	33	$	1,398	$	27	$	69	$	—	$	10	$	(94)	$	55	$	(398)
Total gains/losses (realized/unrealized) recorded for the period relating to those Level 3 assets and liabilities that were still held at the end of the period
Included in earnings, net:
Net investment income	$	1	$	—	$	1	$	—	$	—	$	—	$	—	$	—	$	2	$	—
Investment related gains (losses), net	(27)		—		(3)		—		(3)		—		—		77		—		—


Interest credited	—		—		—		—		—		—		—		—		—		46
Included in other comprehensive income (loss)	12		(2)		2		—		—		—		—		—		(1)		—

(1)Funds withheld at interest – embedded derivative assets and liabilities are presented net for purposes of the rollforward.

(2)The amount reported within purchases, sales and settlements is the purchase price (for purchases) and the sales/settlement proceeds (for sales and settlements) based upon the actual date purchased or sold/settled. Items purchased and sold/settled in the same period are excluded from the rollforward. The Company had no issuances during the period.


For the three months ended March 31, 2023:	Fixed maturity securities available-for-sale														Funds withheld at interest –embedded derivatives, net (1)		Funds withheld at interest		Interest-sensitive contract liabilities – embedded derivatives
	Corporate		Foreign govt		Structured securities		U.S. and local govt		Equity securities		Cash equivalents		Short-term investments
Fair value, beginning of period	$	4,299	$	35	$	1,353	$	35	$	66	$	—	$	13	$	(8)	$	54	$	(530)
Total gains/losses (realized/unrealized)
Included in earnings, net:
Net investment income	1		—		1		—		—		—		—		—		(2)		—
Investment related gains (losses), net	(1)		—		1		—		—		—		(1)		37		—		—

Interest credited	—		—		—		—		—		—		—		—		—		16

Included in other comprehensive income (loss)	55		2		33		(1)		—		—		—		—		1		—

Purchases (2)	318		—		98		—		2		1		1		—		—		2
Sales (2)	—		—		—		—		—		—		—		—		—		—
Settlements (2)	(59)		—		(62)		(1)		—		—		—		—		—		17
Transfers into Level 3	—		—		64		—		—		—		—		—		—		—
Transfers out of Level 3	—		—		(27)		(5)		—		—		(6)		—		—		—
Fair value, end of period	$	4,613	$	37	$	1,461	$	28	$	68	$	1	$	7	$	29	$	53	$	(495)
Total gains/losses (realized/unrealized) recorded for the period relating to those Level 3 assets and liabilities that were still held at the end of the period
Included in earnings, net:
Net investment income	$	1	$	—	$	1	$	—	$	—	$	—	$	—	$	—	$	(2)	$	—
Investment related gains (losses), net	(2)		—		—		—		—		—		(1)		37		—		—


Interest credited	—		—		—		—		—		—		—		—		—		(1)
Included in other comprehensive income (loss)	52		2		33		(1)		—		—		—		—		1		—

(1)Funds withheld at interest – embedded derivative assets and liabilities are presented net for purposes of the rollforward.

Financial Instruments Carrying Amounts And Estimated Fair Value [Table Text Block]

The following table presents the carrying values and estimated fair values of the Company’s financial instruments, which were not measured at fair value on a recurring basis, as of March 31, 2024 and December 31, 2023 (dollars in millions). For additional information regarding the methods and significant assumptions used by the Company to estimate these fair values, see Note 13 – “Fair Value of Assets and Liabilities” in the Notes to Consolidated Financial Statements included in the Company’s 2023 Annual Report. This table excludes any payables or receivables for collateral under repurchase/reverse repurchase agreements and other transactions. The estimated fair value of the excluded amount approximates carrying value as they equal the amount of cash collateral received/paid.


March 31, 2024:	Carrying Value (1)		Estimated Fair Value		Fair Value Measurement Using:
					Level 1		Level 2		Level 3
Assets:
Mortgage loans	$	7,539	$	7,116	$	—	$	—	$	7,116
Policy loans	1,198		1,198		—		1,198		—
Funds withheld at interest	5,871		5,485		—		—		5,485
Limited partnerships – cost method	71		74		—		—		74
Cash and cash equivalents	3,237		3,237		3,237		—		—
Short-term investments	47		47		47		—		—
Other invested assets	1,015		832		5		64		763
Accrued investment income	808		808		—		808		—
Liabilities:
Interest-sensitive contract liabilities (2)	$	22,283	$	21,916	$	—	$	—	$	21,916
Funds withheld at interest	4,599		4,341		—		—		4,341
Long-term debt	4,427		4,235		—		—		4,235


December 31, 2023:
Assets:
Mortgage loans	$	7,377	$	6,975	$	—	$	—	$	6,975
Policy loans	1,206		1,206		—		1,206		—
Funds withheld at interest	6,005		5,547		—		—		5,547
Limited partnerships – cost method	71		73		—		—		73
Cash and cash equivalents	1,635		1,635		1,635		—		—
Short-term investments	35		35		35		—		—
Other invested assets	1,019		841		4		63		774
Accrued investment income	759		759		—		759		—
Liabilities:
Interest-sensitive contract liabilities (2)	$	21,797	$	21,665	$	—	$	—	$	21,665
Funds withheld at interest	4,689		4,400		—		—		4,400
Long-term debt	4,427		4,243		—		—		4,243

(1)Carrying values presented herein may differ from those in the Company’s condensed consolidated balance sheets because certain items within the respective financial statement captions may be measured at fair value on a recurring basis.

(2)Carrying values and estimated fair values presented herein include a reinsurance recoverable of $2.1 billion and $2.2 billion as of March 31, 2024 and December 31, 2023, respectively.

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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