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Investment Contract Liabilities
 12 Months Ended
Dec. 31, 2021
Text block [abstract]  
Investment Contract Liabilities
Note 7     Investment Contract Liabilities
Investment contract liabilities are contractual obligations that do not contain significant insurance risk. These contracts are measured either at fair value or at amortized cost.
(a) Investment contract liabilities measured at fair value
Investment contract liabilities measured at fair value include certain investment savings and pension products sold primarily in Hong Kong and mainland China. The following table presents the movement in investment contract liabilities measured at fair value.
 
For the years ended December 31,
  
2021
     2020  
Balance, January 1
  
$
    932
 
   $ 789  
New policies
  
 
54
 
     180  
Changes in market conditions
  
 
(38
) 
     90  
Redemptions, surrenders and maturities
  
 
(138
) 
     (108 ) 
Impact of changes in foreign exchange rates
  
 
(8
) 
     (19 ) 
Balance, December 31
  
$
    802
 
   $     932  
(b) Investment contract liabilities measured at amortized cost
Investment contract liabilities measured at amortized cost include several fixed annuity products sold in the U.S. and Canada that provide guaranteed income payments for a contractually determined period and are not contingent on survivorship.
The following table presents carrying and fair values of investment contract liabilities measured at amortized cost.
 
   
2021
           2020  
As at December 31,
  
Amortized
cost, gross of
reinsurance
ceded
(1)
     Fair value          
Amortized
cost, gross of
reinsurance
ceded
(1)
     Fair value  
U.S. fixed annuity products
  
$
  1,380
 
  
$
  1,602
 
               $   1,361     $   1,680  
Canadian fixed annuity products
  
 
935
 
  
 
1,016
 
             995       1,086  
Investment contract liabilities
  
$
2,315
 
  
$
2,618
 
               $   2,356     $ 2,766  
 
(1)
As at December 31, 2021, investment contract liabilities with the carrying value and fair value of $48 and $52, respectively (2020 – $67 and $76, respectively), were reinsured by the Company. The net carrying value and fair value of investment contract liabilities were $2,267 and $2,566 (2020 – $2,289 and $2,690), respectively.
The changes in investment contract liabilities measured at amortized cost was a result of the following business activities.
 
For the years ended December 31,
  
2021
     2020  
Balance, January 1
  
$
2,356
 
   $   2,315  
Policy deposits
  
 
92
 
     202  
Interest
  
 
71
 
     61  
Withdrawals
  
 
(191
) 
     (194 ) 
Fees
  
 
(1
) 
     (1 ) 
Other
  
 
(5
) 
     –  
Impact of changes in foreign exchange rates
  
 
(7
) 
     (27 ) 
Balance, December 31
  
$
  2,315
 
   $ 2,356  
Carrying value of fixed annuity products is amortized at a rate that exactly discounts the projected actual cash flows to the net carrying amount of the liability at the date of issue.
Fair value of fixed annuity products is determined by projecting cash flows according to the contract terms and discounting the cash flows at current market rates adjusted for the Company’s own credit standing. As at December 31, 2021 and 2020, fair value of all investment contract liabilities was determined using Level 2 valuation techniques.
(c) Investment contracts contractual obligations
As at December 31, 2021, the Company’s contractual obligations and commitments relating to the investment contracts are as follows.
 
Payments due by period
    Less than
1 year		     
1 to 3
years
     
3 to 5
years
      Over 5
years		      Total  
Investment contract liabilities
(1)
   
$
  292
 
   
$
  486
 
   
$
  489
 
   
$
  3,542
 
   
$
  4,809
 
 
(1)
Due to the nature of the products, the timing of net cash flows may be before contract maturity. Cash flows are undiscounted.