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Risk Management (Tables) | 12 Months Ended
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Dec. 31, 2024
Disclosure of credit risk exposure [line items] |
Summary of Market Risks and Risk Management Strategies |
Risk Management Strategy | Key Market & Liquidity Risk
| Public Equity Risk | Interest Rate and Spread Risk | ALDA Risk | Foreign Currency Exchange Risk | Liquidity Risk
Product design and pricing | ü | ü | ü | ü | ü
Variable annuity guarantee dynamic hedging | ü | ü |  | ü | ü
Macro equity risk hedging | ü |  |  | ü | ü
Asset liability management | ü | ü | ü | ü | ü
Foreign currency exchange management |  |  |  | ü | ü
Liquidity risk management |  |  |  |  | ü
Summary of Investment Categories for Variable Contracts with Guarantees | Variable contracts with guarantees, including variable annuities and variable life, are invested at the policyholder’s discretion subject to contract limitations, in various fund types within the segregated fund accounts and other investments. The account balances by investment category are set out below.
As at December 31, | 2024 | 2023
Investment category |  |
Equity funds | $51,457 | $45,593
Balanced funds | 37,381 | 35,801
Bond funds | 9,017 | 8,906
Money market funds | 1,712 | 1,559
Other debt investments | 2,082 | 1,907
Total | $101,649 | $93,766
Summary of Potential Immediate Impact on Contractual Service Margin, Other Comprehensive Income to Shareholders and Total Comprehensive Income to Shareholders | Potential impacts on contractual service margin, net income attributed to shareholders, other comprehensive income attributed to shareholders, and total comprehensive income attributed to shareholders of an immediate parallel change in interest rates, corporate spreads or swap spreads relative to current rates(1),(2),(3)
As at December 31, 2024 | Interest rates |  | Corporate spreads |  | Swap spreads
(post-tax except CSM) | -50bp | +50bp |  | -50bp | +50bp |  | -20bp | +20bp
CSM | $100 | $(200) |  | $- | $(100) |  | $- | $-
Net income attributed to shareholders | 100 | (100) |  | 100 | (100) |  | 100 | (100)
Other comprehensive income attributed to shareholders | (100) | 200 |  | (200) | 300 |  | (100) | 100
Total comprehensive income attributed to shareholders | - | 100 |  | (100) | 200 |  | - | -
As at December 31, 2023 | Interest rates |  | Corporate spreads |  | Swap spreads
(post-tax except CSM) | -50bp | +50bp |  | -50bp | +50bp |  | -20bp | +20bp
CSM | $- | $(100) |  | $- | $(100) |  | $- | $-
Net income attributed to shareholders | 100 | (100) |  | - | - |  | 100 | (100)
Other comprehensive income attributed to shareholders | (300) | 300 |  | (200) | 300 |  | (100) | 100
Total comprehensive income attributed to shareholders | (200) | 200 |  | (200) | 300 |  | - | -
(1)See “Caution related to sensitivities” above. (2)Estimates include changes to the net actuarial gains/losses with respect to the Company’s pension obligations as a result of changes in interest rates. (3)Includes guaranteed insurance and annuity products, including variable annuity contracts as well as adjustable benefit products where benefits are generally adjusted as interest rates and investment returns change, a portion of which have minimum credited rate guarantees. For adjustable benefit products subject to minimum rate guarantees, the sensitivities are based on the assumption that credited rates will be floored at the minimum.
Summary of Potential Immediate Impacts on Contractual Service Margin, Net Income Attributed to Shareholders, Other Comprehensive Income Attributed to Shareholders, and Total Comprehensive Income Attributed to Shareholders from Changes in ALDA Market Values | Potential immediate impacts on contractual service margin, net income attributed to shareholders, other comprehensive income attributed to shareholders, and total comprehensive income attributed to shareholders from changes in ALDA market values(1)
As at | December 31, 2024 |  | December 31, 2023
(post-tax except CSM) | -10% | +10% |  | -10% | +10%
CSM excluding NCI | $(200) | $200 |  | $(100) | $100
Net income attributed to shareholders(2) | (2,500) | 2,500 |  | (2,400) | 2,400
Other comprehensive income attributed to shareholders | (200) | 200 |  | (200) | 200
Total comprehensive income attributed to shareholders | (2,700) | 2,700 |  | (2,600) | 2,600
(1)See “Caution related to sensitivities” above. (2)Net income attributed to shareholders includes core earnings and the amounts excluded from core earnings.
Summary of Gross Carrying Amount of Financial Instruments Subject to Credit Exposure | Credit quality The following tables present financial instruments subject to credit exposure, without considering any collateral held or other credit enhancements, and other significant credit risk exposures from loan commitments, with allowances, presenting separately Stage 1, Stage 2, and Stage 3 credit risk profiles. For each asset type presented in the table, amortized cost and FVOCI financial instruments are presented together. Amortized cost financial instruments are shown gross of the allowance for credit losses, which is shown separately. FVOCI financial instruments are shown at fair value with the allowance for credit losses shown separately.
As at December 31, 2024 | Stage 1 | Stage 2 | Stage 3 | Total
Debt securities, measured at FVOCI |  |  |  |
Investment grade | $197,840 | $1,338 | $- | $199,178
Non-investment grade | 5,625 | 363 | - | 5,988
Total carrying value | 203,465 | 1,701 | - | 205,166
Allowance for credit losses | 228 | 42 | - | 270
Debt securities, measured at amortized cost |  |  |  |
Investment grade | 1,496 | - | - | 1,496
Non-investment grade | - | - | - | -
Total | 1,496 | - | - | 1,496
Allowance for credit losses | 1 | - | - | 1
Total carrying value, net of allowance | 1,495 | - | - | 1,495
Private placements, measured at FVOCI |  |  |  |
Investment grade | 41,796 | 721 | - | 42,517
Non-investment grade | 5,004 | 1,133 | 148 | 6,285
Total carrying value | 46,800 | 1,854 | 148 | 48,802
Allowance for credit losses | 126 | 127 | 123 | 376
Commercial mortgages, measured at FVOCI |  |  |  |
AAA | 205 | - | - | 205
AA | 7,234 | - | - | 7,234
A | 14,035 | - | - | 14,035
BBB | 5,679 | 873 | - | 6,552
BB | 11 | 663 | - | 674
B and lower | - | 21 | 71 | 92
Total carrying value | 27,164 | 1,557 | 71 | 28,792
Allowance for credit losses | 41 | 39 | 55 | 135
Commercial mortgages, measured at amortized cost |  |  |  |
AAA | - | - | - | -
AA | - | - | - | -
A | 225 | 15 | - | 240
BBB | - | - | - | -
BB | - | - | - | -
B and lower | 112 | 5 | 5 | 122
Total | 337 | 20 | 5 | 362
Allowance for credit losses | 1 | 1 | - | 2
Total carrying value, net of allowance | 336 | 19 | 5 | 360
Residential mortgages, measured at amortized cost |  |  |  |
Performing | 22,870 | 1,151 | - | 24,021
Non-performing | - | - | 41 | 41
Total | 22,870 | 1,151 | 41 | 24,062
Allowance for credit losses | 3 | 2 | 1 | 6
Total carrying value, net of allowance | 22,867 | 1,149 | 40 | 24,056
Loans to Bank clients, measured at amortized cost |  |  |  |
Performing | 2,265 | 38 | - | 2,303
Non-performing | - | - | 10 | 10
Total | 2,265 | 38 | 10 | 2,313
Allowance for credit losses | 1 | 1 | 1 | 3
Total carrying value, net of allowance | 2,264 | 37 | 9 | 2,310
Other invested assets, measured at FVOCI |  |  |  |
Investment grade | - | - | - | -
Non-investment grade | 389 | - | - | 389
Total carrying value | 389 | - | - | 389
Allowance for credit losses | 22 | - | - | 22
Other invested assets, measured at amortized cost |  |  |  |
Investment grade | 4,302 | - | - | 4,302
Non-investment grade | - | - | - | -
Total | 4,302 | - | - | 4,302
Allowance for credit losses | 2 | - | - | 2
Total carrying value, net of allowance | 4,300 | - | - | 4,300
Loan commitments |  |  |  |
Allowance for credit losses | 9 | 1 | 1 | 11
Total carrying value, net of allowance | $309,080 | $6,317 | $273 | $315,670
As at December 31, 2023 | Stage 1 | Stage 2 | Stage 3 | Total
Debt securities, measured at FVOCI |  |  |  |
Investment grade | $197,562 | $2,252 | $- | $199,814
Non-investment grade | 5,367 | 596 | - | 5,963
Total carrying value | 202,929 | 2,848 | - | 205,777
Allowance for credit losses | 283 | 54 | 6 | 343
Debt securities, measured at amortized cost |  |  |  |
Investment grade | 1,373 | - | - | 1,373
Non-investment grade | - | - | - | -
Total | 1,373 | - | - | 1,373
Allowance for credit losses | 1 | - | - | 1
Total carrying value, net of allowance | 1,372 | - | - | 1,372
Private placements, measured at FVOCI |  |  |  |
Investment grade | 37,722 | 1,644 | - | 39,366
Non-investment grade | 5,210 | 295 | 81 | 5,586
Total carrying value | 42,932 | 1,939 | 81 | 44,952
Allowance for credit losses | 126 | 108 | 83 | 317
Commercial mortgages, measured at FVOCI |  |  |  |
AAA | 279 | - | - | 279
AA | 6,815 | - | - | 6,815
A | 14,111 | 86 | - | 14,197
BBB | 5,513 | 984 | - | 6,497
BB | 10 | 532 | - | 542
B and lower | - | 36 | 107 | 143
Total carrying value | 26,728 | 1,638 | 107 | 28,473
Allowance for credit losses | 40 | 42 | 143 | 225
Commercial mortgages, measured at amortized cost |  |  |  |
AAA | - | - | - | -
AA | - | - | - | -
A | 148 | 48 | - | 196
BBB | - | - | - | -
BB | - | - | - | -
B and lower | 145 | 35 | - | 180
Total | 293 | 83 | - | 376
Allowance for credit losses | 1 | 2 | - | 3
Total carrying value, net of allowance | 292 | 81 | - | 373
Residential mortgages, measured at amortized cost |  |  |  |
Performing | 20,898 | 1,570 | - | 22,468
Non-performing | - | - | 60 | 60
Total | 20,898 | 1,570 | 60 | 22,528
Allowance for credit losses | 4 | 2 | 2 | 8
Total carrying value, net of allowance | 20,894 | 1,568 | 58 | 22,520
Loans to Bank clients, measured at amortized cost |  |  |  |
Performing | 2,387 | 44 | - | 2,431
Non-performing | - | - | 8 | 8
Total | 2,387 | 44 | 8 | 2,439
Allowance for credit losses | 2 | - | 1 | 3
Total carrying value, net of allowance | 2,385 | 44 | 7 | 2,436
Other invested assets, measured at FVOCI |  |  |  |
Investment grade | - | - | - | -
Non-investment grade | 360 | - | - | 360
Total carrying value | 360 | - | - | 360
Allowance for credit losses | 16 | - | - | 16
Other invested assets, measured at amortized cost |  |  |  |
Investment grade | 3,791 | - | - | 3,791
Non-investment grade | - | - | - | -
Total | 3,791 | - | - | 3,791
Allowance for credit losses | 1 | - | - | 1
Total carrying value, net of allowance | 3,790 | - | - | 3,790
Loan commitments |  |  |  |
Allowance for credit losses | 9 | 1 | 2 | 12
Total carrying value, net of allowance | $301,682 | $8,118 | $253 | $310,053
Summary of Allowance for Credit Losses by Stage | Allowance for credit losses The following tables provide details on the allowance for credit losses by stage as at and for the year ended December 31, 2024 and 2023.
As at December 31, 2024 | Stage 1 | Stage 2 | Stage 3 | Total
Balance, beginning of year | $483 | $209 | $237 | $929
Net re-measurement due to transfers | 4 | (22) | 18 | -
Transfer to stage 1 | 12 | (12) | - | -
Transfer to stage 2 | (7) | 7 | - | -
Transfer to stage 3 | (1) | (17) | 18 | -
Net originations, purchases, disposals and repayments | 36 | (8) | (159) | (131)
Changes to risk, parameters, and models | (107) | 21 | 81 | (5)
Foreign exchange and other adjustments | 18 | 13 | 4 | 35
Balance, end of year | $434 | $213 | $181 | $828
As at December 31, 2023 | Stage 1 | Stage 2 | Stage 3 | Total
Balance, beginning of year | $511 | $141 | $72 | $724
Net re-measurement due to transfers | 4 | 6 | (10) | -
Transfer to stage 1 | 12 | (11) | (1) | -
Transfer to stage 2 | (6) | 28 | (22) | -
Transfer to stage 3 | (2) | (11) | 13 | -
Net originations, purchases, disposals and repayments | 45 | 8 | (23) | 30
Changes to risk, parameters, and models | (71) | 48 | 233 | 210
Foreign exchange and other adjustments | (6) | 6 | (35) | (35)
Balance, end of year | $483 | $209 | $237 | $929
Summary of Macroeconomic Variables Used to Measure Allowance for Credit Losses | Significant judgements and estimates The following tables show certain key macroeconomic variables used to estimate the ECL allowances by market. For the base case, upside and downside scenarios, the projections are provided for the next 12 months and then for the remaining forecast period, which represents a medium-term view.
|  | Base case scenario |  | Upside scenario |  | Downside scenario 1 |  | Downside scenario 2
As at December 31, 2024 | Current quarter | Next 12 months | Ensuing 4 years |  | Next 12 months | Ensuing 4 years |  | Next 12 months | Ensuing 4 years |  | Next 12 months | Ensuing 4 years
Canada |  |  |  |  |  |  |  |  |  |  |  |
Gross Domestic Product (GDP), in U.S. $ billions | $1,983 | 1.8% | 2.0% |  | 3.3% | 2.3% |  | (2.0)% | 2.3% |  | (3.9)% | 2.2%
Unemployment rate | 6.7% | 6.8% | 6.3% |  | 6.5% | 5.8% |  | 8.1% | 8.2% |  | 8.5% | 10.0%
NYMEX Light Sweet Crude Oil, in U.S. dollars, per barrel | $76.0 | $75.0 | $72.0 |  | $79.0 | $74.0 |  | $59.0 | $66.0 |  | $50.0 | $61.0
U.S. |  |  |  |  |  |  |  |  |  |  |  |
Gross Domestic Product (GDP), in U.S. $ billions | $23,534 | 2.1% | 2.2% |  | 3.6% | 2.3% |  | (2.0)% | 2.7% |  | (4.2)% | 2.5%
Unemployment rate | 4.2% | 4.1% | 4.0% |  | 3.3% | 3.3% |  | 7.3% | 6.1% |  | 7.8% | 8.1%
7-10 Year BBB U.S. Corporate Index | 5.5% | 6.1% | 6.1% |  | 5.9% | 6.2% |  | 5.4% | 5.6% |  | 6.0% | 5.4%
Japan |  |  |  |  |  |  |  |  |  |  |  |
Gross Domestic Product (GDP), in JPY billions | ¥563,281 | 0.9% | 0.7% |  | 2.8% | 0.8% |  | (3.6)% | 1.0% |  | (7.1)% | 1.6%
Unemployment rate | 2.5% | 2.5% | 2.2% |  | 2.4% | 2.1% |  | 3.1% | 2.9% |  | 3.2% | 3.5%
Hong Kong |  |  |  |  |  |  |  |  |  |  |  |
Unemployment rate | 3.0% | 2.9% | 3.0% |  | 2.5% | 2.7% |  | 4.1% | 3.8% |  | 4.6% | 4.6%
Hang Seng Index | 19,448 | 7.0% | 4.1% |  | 18.1% | 3.7% |  | (19.7)% | 9.9% |  | (37.0)% | 13.5%
China |  |  |  |  |  |  |  |  |  |  |  |
Gross Domestic Product (GDP), in CNY billions | ¥114,931 | 4.0% | 4.1% |  | 6.5% | 4.3% |  | (3.0)% | 4.6% |  | (5.7)% | 3.9%
FTSE Xinhua A200 Index | 10,938 | (0.6)% | 4.8% |  | 13.8% | 2.8% |  | (31.1)% | 11.7% |  | (40.5)% | 13.5%
(IV)
Summary of Estimated Expected Credit Losses From All Macroeconomic Scenarios | Sensitivity to changes in economic assumptions The following table shows the ECL allowance balance which resulted from all four macroeconomic scenarios (including the more heavily weighted best estimate baseline scenario, one upside and two downside scenarios) weighted by probability of occurrence and shows an ECL allowance resulting from only the baseline scenario.
As at December 31, | 2024 | 2023
Probability-weighted ECL | $828 | $929
Baseline ECL | $629 | $659
Difference - in amount | $199 | $270
Difference - in percentage | 24.03% | 29.06%
Summary of Effect of Conditional Master Netting and Similar Arrangements | The following tables presents the effect of conditional master netting and similar arrangements. Similar arrangements may include global master repurchase agreements, global master securities lending agreements, and any related rights to financial collateral pledged or received.
|  | Related amounts not set off in the Consolidated Statements of Financial Position |  |
As at December 31, 2024 | Gross amounts of financial instruments(1) | Amounts subject to an enforceable master netting arrangement or similar agreements | Financial and cash collateral pledged (received)(2) | Net amounts including financing entity(3) | Net amounts excluding financing entity
Financial assets |  |  |  |  |  |
Derivative assets | $9,048 |  | $(6,633) | $(1,986) | $429 | $429
Securities lending | 1,021 |  | - | (1,021) | - | -
Reverse repurchase agreements | 1,594 |  | (569) | (1,025) | - | -
Total financial assets | $11,663 |  | $(7,202) | $(4,032) | $429 | $429
Financial liabilities |  |  |  |  |  |
Derivative liabilities | $(15,026) |  | $6,633 | $8,305 | $(88) | $(15)
Repurchase agreements | (668) |  | 569 | 99 | - | -
Total financial liabilities | $(15,694) |  | $7,202 | $8,404 | $(88) | $(15)
|  | Related amounts not set off in the Consolidated Statements of Financial Position |  |
As at December 31, 2023 | Gross amounts of financial instruments(1) | Amounts subject to an enforceable master netting arrangement or similar agreements | Financial and cash collateral pledged (received)(2) | Net amounts including financing entity(3) | Net amounts excluding financing entity
Financial assets |  |  |  |  |  |
Derivative assets | $9,044 |  | $(6,516) | $(2,374) | $154 | $154
Securities lending | 626 |  | - | (626) | - | -
Reverse repurchase agreements | 466 |  | (202) | (264) | - | -
Total financial assets | $10,136 |  | $(6,718) | $(3,264) | $154 | $154
Financial liabilities |  |  |  |  |  |
Derivative liabilities | $(12,600) |  | $6,516 | $5,958 | $(126) | $(57)
Repurchase agreements | (202) |  | 202 | - | - | -
Total financial liabilities | $(12,802) |  | $6,718 | $5,958 | $(126) | $(57)
(1)Financial assets and liabilities include accrued interest of $388 and $779 respectively (2023 – $502 and $913 respectively). (2)Financial and cash collateral exclude over-collateralization. As at December 31, 2024, the Company was over-collateralized on OTC derivative assets, OTC derivative liabilities, securities lending and reverse repurchase agreements and repurchase agreements in the amounts of $641, $2,472, $35 and $nil respectively (2023 – $424, $1,420, $20 and $nil respectively). As at December 31, 2024, collateral pledged (received) does not include collateral-in-transit on OTC instruments or initial margin on exchange-traded contracts or cleared contracts. (3)Includes derivative contracts entered between the Company and its unconsolidated financing entity. The Company does not exchange collateral on derivative contracts entered with this entity. Refer to note 17.
Summary of the Effect of Unconditional Netting | The following tables present the effect of unconditional netting.
As at December 31, 2024 | Gross amounts of financial instruments | Amounts subject to an enforceable netting arrangement | Net amounts of financial instruments
Credit linked note(1) | $1,392 |  | $(1,392) | $-
Variable surplus note | (1,392) |  | 1,392 | -
As at December 31, 2023 | Gross amounts of financial instruments | Amounts subject to an enforceable netting arrangement | Net amounts of financial instruments
Credit linked note(1) | $1,276 |  | $(1,276) | $-
Variable surplus note | (1,276) |  | 1,276 | -
(1)As at December 31, 2024 and 2023, the Company had no fixed surplus notes outstanding. Refer to note 18 (g).
Summary of Debt Securities and Private Placements Portfolio by Sector and Industry Explanatory | The following table presents debt securities and private placements portfolio by sector and industry.
| 2024 |  | 2023
As at December 31, | Carrying value | % of total |  | Carrying value | % of total
Government and agency | $88,376 | 34% |  | $84,739 | 33%
Utilities | 45,812 | 18% |  | 45,952 | 18%
Financial | 38,656 | 15% |  | 39,069 | 15%
Consumer | 31,529 | 12% |  | 31,181 | 12%
Energy | 15,840 | 6% |  | 15,782 | 6%
Industrial | 24,233 | 9% |  | 24,209 | 9%
Other | 15,843 | 6% |  | 16,823 | 7%
Total | $260,289 | 100% |  | $257,755 | 100%
Summary of Geographic Concentration of Insurance and Investment Contract Liabilities, Including Embedded Derivatives | The geographic concentration of the Company’s insurance and investment contract liabilities, including embedded derivatives, is shown below. The disclosure is based on the countries in which the business is written.
As at December 31, 2024 | Insurance contract liabilities | Investment contract liabilities | Reinsurance assets | Net liabilities
U.S. and Canada | $342,146 | $305,563 | $(52,055) | $595,654
Asia and Other | 180,698 | 17,378 | (6,294) | 191,782
Total | $522,844 | $322,941 | $(58,349) | $787,436
As at December 31, 2023 | Insurance contract liabilities | Investment contract liabilities | Reinsurance assets | Net liabilities
U.S. and Canada | $327,458 | $260,046 | $(39,080) | $548,424
Asia and Other | 154,536 | 15,171 | (1,169) | 168,538
Total | $481,994 | $275,217 | $(40,249) | $716,962
Asset classes and individual investment risks |
Disclosure of credit risk exposure [line items] |
Schedule of Risk Concentrations |
As at December 31, | 2024 | 2023
Debt securities and private placements rated as investment grade BBB or higher(1) | 96% | 95%
Government debt securities as a per cent of total debt securities | 40% | 38%
Government private placements as a per cent of total private placements | 9% | 10%
Highest exposure to a single non-government debt security or private placement issuer | $1,121 | $1,131
Largest single issuer as a per cent of the total equity portfolio | 2% | 2%
Income producing commercial office properties (2024 – 35% of real estate, 2023 – 37%) | $4,696 | $4,829
Largest concentration of mortgages and real estate(2) – Ontario Canada (2024 – 28%, 2023 – 29%) | $19,052 | $19,003
(1)Investment grade debt securities and private placements include 37% rated A, 17% rated AA and 15% rated AAA (2023 – 38%, 17% and 15%) investments based on external ratings where available. (2)Mortgages and real estate investments are diversified geographically and by property type.
AA |
Disclosure of credit risk exposure [line items] |
Summary of Credit Default Swap Protection Sold | The following tables present details of the credit default swap protection sold by type of contract and external agency rating for the underlying reference security.
As at December 31, 2024 | Notional amount(1) | Fair value | Weighted average maturity (in years)(2)
Single name CDS(3),(4) – Corporate debt |  |  |
AA | $23 | $1 | 3
A | 68 | 1 | 3
BBB | 23 | - | 2
Total single name CDS | $114 | $2 | 3
Total CDS protection sold | $114 | $2 | 3
As at December 31, 2023 | Notional amount(1) | Fair value | Weighted average maturity (in years)(2)
Single name CDS(3),(4) – Corporate debt |  |  |
AA | $23 | $1 | 4
A | 94 | 2 | 3
BBB | 14 | - | 1
Total single name CDS | $131 | $3 | 3
Total CDS protection sold | $131 | $3 | 3
(1)Notional amounts represent the maximum future payments the Company would have to pay its counterparties assuming a default of the underlying credit and zero recovery on the underlying issuer obligations. (2)The weighted average maturity of the CDS is weighted based on notional amounts. (3)Ratings are based on S&P where available followed by Moody’s, Morningstar DBRS, and Fitch. If no rating is available from a rating agency, an internally developed rating is used. (4)The Company held no purchased credit protection as at December 31, 2024 and 2023.
IFRS 7 |
Disclosure of credit risk exposure [line items] |
Summary of Significant Financial Liabilities | Maturity of financial liabilities(1)
As at December 31, 2024 | Less than 1 year | 1 to 3 years | 3 to 5 years | Over 5 years | Total
Long-term debt | $- | $2,829 | $- | $3,800 | $6,629
Capital instruments | - | - | - | 7,532 | 7,532
Derivatives | 2,320 | 2,304 | 1,244 | 8,379 | 14,247
Deposits from Bank clients(2) | 15,690 | 3,774 | 2,599 | - | 22,063
Lease liabilities | 105 | 151 | 52 | 47 | 355
(1)The amounts shown above are net of the related unamortized deferred issue costs. (2)Carrying value and fair value of deposits from Bank clients as at December 31, 2024 were $22,063 and $22,270, respectively (2023 – $21,616 and $21,518 respectively). Fair value is determined by discounting contractual cash flows, using market interest rates currently offered for deposits with similar terms and conditions. All deposits from Bank clients were categorized in Level 2 of the fair value hierarchy (2023 – Level 2).
Summary of Variable Annuity and Segregated Fund Investment-Related Guarantees Gross and Net of Reinsurance | Variable annuity and segregated fund guarantees, net of reinsurance
| 2024 |  | 2023
As at December 31, | Guarantee value(1) | Fund value | Net amount at risk(1),(2),(3) |  | Guarantee value(1) | Fund value | Net amount at risk(1),(2),(3)
Guaranteed minimum income benefit | $3,628 | $2,780 | $918 |  | $3,864 | $2,735 | $1,156
Guaranteed minimum withdrawal benefit | 33,473 | 33,539 | 3,339 |  | 34,833 | 33,198 | 4,093
Guaranteed minimum accumulation benefit | 18,987 | 19,097 | 70 |  | 18,996 | 19,025 | 116
Gross living benefits(4) | 56,088 | 55,416 | 4,327 |  | 57,693 | 54,958 | 5,365
Gross death benefits(5) | 8,612 | 19,851 | 644 |  | 9,133 | 17,279 | 975
Total gross of reinsurance | 64,700 | 75,267 | 4,971 |  | 66,826 | 72,237 | 6,340
Living benefits reinsured | 23,768 | 23,965 | 3,016 |  | 24,208 | 23,146 | 3,395
Death benefits reinsured | 3,430 | 2,776 | 289 |  | 3,400 | 2,576 | 482
Total reinsured | 27,198 | 26,741 | 3,305 |  | 27,608 | 25,722 | 3,877
Total, net of reinsurance | $37,502 | $48,526 | $1,666 |  | $39,218 | $46,515 | $2,463
(1)Guarantee Value and Net Amount at Risk in respect of guaranteed minimum withdrawal business in Canada and the U.S. reflect the time value of money of these claims. (2)Amount at risk (in-the-money amount) is the excess of guarantee values over fund values on all policies where the guarantee value exceeds the fund value. For guaranteed minimum death benefit, the amount at risk is defined as the current guaranteed minimum death benefit in excess of the current account balance and assumes that all claims are immediately payable. In practice, guaranteed death benefits are contingent and only payable upon the eventual death of policyholders if fund values remain below guarantee values. For guaranteed minimum withdrawal benefit, the amount at risk assumes that the benefit is paid as a lifetime annuity commencing at the earliest contractual income start age. These benefits are also contingent and only payable at scheduled maturity/income start dates in the future, if the policyholders are still living and have not terminated their policies and fund values remain below guarantee values. For all guarantees, the amount at risk is floored at zero at the single contract level. (3)The amount at risk net of reinsurance at December 31, 2024 was $1,666 (December 31, 2023 – $2,463) of which: US$293 (December 31, 2023 – US$391) was on the Company’s U.S. business, $1,021 (December 31, 2023 – $1,559) was on the Company’s Canadian business, US$100 (December 31, 2023 – US$140) was on the Company’s Japan business, and US$56 (December 31, 2023 – US$155) was related to Asia (other than Japan) and the Company’s run-off reinsurance business. (4)Where a policy includes both living and death benefits, the guarantee in excess of the living benefit is included in the death benefit category as outlined in footnote 5. (5)Death benefits include stand-alone guarantees and guarantees in excess of living benefit guarantees where both death and living benefits are provided on a policy.
Summary of Potential Immediate Impact on Net Income Attributed to Shareholders by Changes to Public Equity Returns Explanatory | Potential immediate impact on net income attributed to shareholders arising from changes to public equity returns(1)
| Net income attributed to shareholders
As at December 31, 2024 | -30% | -20% | -10% | +10% | +20% | +30%
Underlying sensitivity |  |  |  |  |  |
Variable annuity and segregated fund guarantees(2) | $(2,050) | $(1,240) | $(560) | $470 | $860 | $1,190
General fund equity investments(3) | (1,240) | (820) | (400) | 390 | 780 | 1,180
Total underlying sensitivity before hedging | (3,290) | (2,060) | (960) | 860 | 1,640 | 2,370
Impact of macro and dynamic hedge assets(4) | 720 | 430 | 190 | (150) | (260) | (360)
Net potential impact on net income attributed to shareholders after impact of hedging and before impact of reinsurance | (2,570) | (1,630) | (770) | 710 | 1,380 | 2,010
Impact of reinsurance | 1,320 | 810 | 370 | (320) | (590) | (830)
Net potential impact on net income attributed to shareholders after impact of hedging and reinsurance | $(1,250) | $(820) | $(400) | $390 | $790 | $1,180
| Net income attributed to shareholders
As at December 31, 2023 | -30% | -20% | -10% | +10% | +20% | +30%
Underlying sensitivity |  |  |  |  |  |
Variable annuity and segregated fund guarantees(2) | $(2,370) | $(1,460) | $(670) | $550 | $1,010 | $1,390
General fund equity investments(3) | (1,170) | (770) | (390) | 380 | 760 | 1,140
Total underlying sensitivity before hedging | (3,540) | (2,230) | (1,060) | 930 | 1,770 | 2,530
Impact of macro and dynamic hedge assets(4) | 880 | 530 | 240 | (190) | (340) | (460)
Net potential impact on net income attributed to shareholders after impact of hedging and before impact of reinsurance | (2,660) | (1,700) | (820) | 740 | 1,430 | 2,070
Impact of reinsurance | 1,470 | 900 | 420 | (350) | (650) | (910)
Net potential impact on net income attributed to shareholders after impact of hedging and reinsurance | $(1,190) | $(800) | $(400) | $390 | $780 | $1,160
(1)See “Caution related to sensitivities” above. (2)For variable annuity contracts measured under the VFA approach, the impact of financial risk and changes in interest rates adjusts CSM, unless the risk mitigation option applies. The Company has elected to apply risk mitigation and therefore, a portion of the impact is reported in net income attributed to shareholders instead of adjusting the CSM. If the CSM for a group of variable annuity contracts is exhausted, the full impact is reported in net income attributed to shareholders. (3)This impact for general fund equity investments includes general fund investments supporting the Company’s insurance contract liabilities, investment in seed money investments (in segregated and mutual funds made by Global WAM segment), and the impact on insurance contract liabilities related to the projected future fee income on variable universal life and other unit-linked products. The impact does not include any potential impact on public equity weightings. The participating policy funds are largely self-supporting and generate no material impact on net income attributed to shareholders as a result of changes in equity markets. (4)Includes the impact of assumed rebalancing of equity hedges in the macro and dynamic hedging program. The impact of dynamic hedging represents the impact of equity hedges offsetting 95% of the dynamically hedged variable annuity liability movement that occurs as a result of market changes, but does not include any impact in respect of other sources of hedge accounting ineffectiveness (e.g., fund tracking, realized volatility, and equity and interest rate correlations different from expected among other factors).
Summary of Potential Immediate Impact on Contractual Service Margin, Other Comprehensive Income to Shareholders and Total Comprehensive Income to Shareholders | Potential immediate impact on contractual service margin, other comprehensive income to shareholders and total comprehensive income to shareholders from changes to public equity market values(1),(2),(3)
As at December 31, 2024 | -30% | -20% | -10% | +10% | +20% | +30%
Variable annuity and segregated fund guarantees reported in CSM | $(3,420) | $(2,110) | $(970) | $840 | $1,580 | $2,250
Impact of risk mitigation - hedging(4) | 940 | 560 | 250 | (190) | (350) | (470)
Impact of risk mitigation - reinsurance(4) | 1,670 | 1,020 | 470 | (400) | (740) | (1,050)
VA net of risk mitigation | (810) | (530) | (250) | 250 | 490 | 730
General fund equity | (1,140) | (740) | (370) | 370 | 750 | 1,110
Contractual service margin (pre-tax) | $(1,950) | $(1,270) | $(620) | $620 | $1,240 | $1,840
Other comprehensive income attributed to shareholders (post-tax)(5) | $(840) | $(560) | $(280) | $270 | $530 | $790
Total comprehensive income attributed to shareholders (post-tax) | $(2,090) | $(1,380) | $(680) | $660 | $1,320 | $1,970
As at December 31, 2023 | -30% | -20% | -10% | +10% | +20% | +30%
Variable annuity and segregated fund guarantees reported in CSM | $(3,810) | $(2,370) | $(1,100) | $940 | $1,760 | $2,470
Impact of risk mitigation - hedging(4) | 1,150 | 700 | 310 | (250) | (450) | (600)
Impact of risk mitigation - reinsurance(4) | 1,850 | 1,140 | 530 | (450) | (830) | (1,150)
VA net of risk mitigation | (810) | (530) | (260) | 240 | 480 | 720
General fund equity | (940) | (610) | (300) | 290 | 590 | 870
Contractual service margin (pre-tax) | $(1,750) | $(1,140) | $(560) | $530 | $1,070 | $1,590
Other comprehensive income attributed to shareholders (post-tax)(5) | $(730) | $(490) | $(240) | $230 | $460 | $680
Total comprehensive income attributed to shareholders (post-tax) | $(1,920) | $(1,290) | $(640) | $620 | $1,240 | $1,840
(1)See “Caution related to sensitivities” above. (2)This estimate assumes that the performance of the dynamic hedging program would not completely offset the gain/loss from the dynamically hedged variable annuity and segregated fund guarantee liabilities. It assumes that the hedge assets are based on the actual position at the period end, and that equity hedges in the dynamic program offset 95% of the hedged variable annuity liability movement that occur as a result of market changes. (3)OSFI rules for segregated fund guarantees reflect full capital impacts of shocks over 20 quarters within a prescribed range. As such, the deterioration in equity markets could lead to further increases in capital requirements after the initial shock. (4)For variable annuity contracts measured under VFA the impact of financial risk and changes in interest rates adjusts CSM, unless the risk mitigation option applies. The Company has elected to apply risk mitigation and therefore a portion of the impact is reported in net income attributed to shareholders instead of adjusting the CSM. If the CSM for a group of variable annuity contracts is exhausted the full impact is reported in net income attributed to shareholders. (5)The impact of financial risk and changes to interest rates for variable annuity contracts is not expected to generate sensitivity in Other Comprehensive Income.

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