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Life Policy and Investment Contract Reserves (Tables)

3 Months Ended

Mar. 31, 2025

Policyholder Account Balance [Abstract]

Reserve For Losses Loss Adjustment Expenses Table

The following table summarizes our life policy and investment contract reserves and provides a reconciliation of the balances described in the below tables to those in the condensed consolidated balance sheets:

(Dollars in millions)						March 31, 2025						December 31, 2024
Life policy reserves:
Term						$	1,064					$	1,051
Whole life						412						405
Other						99						98
Subtotal						1,575						1,554
Investment contract reserves:
Deferred annuities						582						595
Universal life						587						586
Structured settlements						116						116
Other						108						109
Subtotal						1,393						1,406
Total life policy and investment contract reserves						$	2,968					$	2,960

Liability for Future Policy Benefit, Activity

The balances and changes in the term and whole life policy reserves included in life policy and investment contract reserves are as follows:

(Dollars in millions)						Three months ended March 31,
						2025												2024
						Term						Whole life						Term						Whole life
Present value of expected net premiums:
Balance, beginning of period						$	1,638					$	218					$	1,700					$	223
Beginning balance at original discount rate						1,719						228						1,712						225
Effect of changes in cash flow assumptions						—						—						—						—
Effect of actual variances from expected experience						(8)						—						(9)						—
Adjusted beginning of period balance						1,711						228						1,703						225
Issuances						35						3						35						5
Interest accrual						19						3						18						2
Net premiums collected						(46)						(7)						(46)						(7)
Ending balance at original discount rate						1,719						227						1,710						225
Effect of changes in discount rate assumptions						(60)						(7)						(50)						(6)
Balance, end of period						1,659						220						1,660						219
Present value of expected future policy benefits:
Balance, beginning of period						2,668						623						2,751						657
Beginning balance at original discount rate						2,812						646						2,765						628
Effect of changes in cash flow assumptions						—						—						—						—
Effect of actual variances from expected experience						(14)						—						(14)						—
Adjusted beginning of period balance						2,798						646						2,751						628
Issuances						36						3						35						5
Interest accrual						32						9						31						8
Benefits paid						(54)						(10)						(37)						(8)
Ending balance at original discount rate						2,812						648						2,780						633
Effect of changes in discount rate assumptions						(109)						(17)						(82)						4
Balance, end of period						2,703						631						2,698						637
Net liability for future policy benefits:
Present value of expected future policy benefits less expected net premiums						1,044						411						1,038						418
Impact of flooring at cohort level						20						1						16						—
Net life policy reserves						1,064						412						1,054						418
Less reinsurance recoverable at original discount rate						(82)						(25)						(100)						(24)
Less effect of discount rate assumption changes on reinsurance recoverable						(8)						(3)						(8)						(4)
Net life policy reserves, after reinsurance recoverable						$	974					$	384					$	946					$	390
Weighted-average duration of the net life policy reserves in years						11						15						11						16

The total impact of flooring at cohort level in the above tables includes the effect of discount rate assumption changes of $3 million and $2 million at March 31, 2025 and 2024, respectively.

The following table shows the amount of undiscounted and discounted expected future benefit payments and expected gross premiums for our term and whole life policies:

(Dollars in millions)						At March 31,
						2025												2024
						Undiscounted						Discounted						Undiscounted						Discounted
Term
Expected future benefit payments						$	4,894					$	2,703					$	4,816					$	2,698
Expected future gross premiums						4,561						2,658						4,386						2,601
Whole life
Expected future benefit payments						$	1,719					$	631					$	1,660					$	637
Expected future gross premiums						692						415						663						402

The following table shows the amount of revenue and interest recognized in the condensed consolidated statements of income related to our term and whole life policies:

(Dollars in millions)												Three months ended March 31,
																		2025						2024
Gross premiums
Term																		$	74					$	74
Whole life																		13						13
Total																		$	87					$	87
Interest accretion
Term																		$	13					$	13
Whole life																		6						6
Total																		$	19					$	19

Adverse development that resulted in an immediate charge to income due to net premiums exceeding gross premiums was immaterial for the three months ended March 31, 2025, and 2024.

The following table shows the weighted-average interest rate for our term and whole life products:

						At March 31,
						2025						2024
Term
Interest accretion rate						5.20		%				5.26		%
Current discount rate						4.96						5.09
Whole life
Interest accretion rate						5.87		%				5.90		%
Current discount rate						5.67						5.40

The discount rate assumption was developed by calculating forward rates from market yield curves of upper-medium grade fixed-income instruments.

Policyholder Account Balance

The following table shows the balances and changes in policyholders' account balances included in investment contract reserves:

(Dollars in millions)									Three months ended March 31,
															2025												2024
																											Deferred annuity						Universal life						Deferred annuity						Universal life
Balance, beginning of period																											$	595					$	456					$	656					$	457
Premiums received																											4						10						9						10
Policy charges																											—						(10)						—						(10)
Surrenders and withdrawals																											(17)						(3)						(37)						(4)
Benefit payments																											(5)						(1)						(3)						(2)
Interest credited																											5						5						6						5
Balance, end of period																											$	582					$	457					$	631					$	456
Weighted average crediting rate																											3.68		%				4.40		%				3.55		%				4.33		%
Net amount at risk																											$	—					$	3,801					$	—					$	3,908
Cash surrender value																											575						428						625						425

Policyholder Account Balance, Guaranteed Minimum Crediting Rate

The following table shows the balance of account values by range of guaranteed minimum crediting rates, in basis points, and the related range of the difference between rates being credited to policyholders and the respective guaranteed minimums for our deferred annuity and universal life contracts:

(Dollars in millions)						At guaranteed minimum						1 to 50 basis points above						51-150 basis points above						Greater than 150 basis points						Total
At March 31, 2025
Deferred annuity
1.00-3.00%						$	2					$	286					$	15					$	233					$	536
3.01-4.00%						46						—						—						—						46
Total						$	48					$	286					$	15					$	233					$	582
Universal life
1.00-3.00%						$	—					$	55					$	65					$	6					$	126
3.01-4.00%						50						—						5						—						55
Greater than 4.00%						276						—						—						—						276
Total						$	326					$	55					$	70					$	6					$	457
At March 31, 2024
Deferred annuity
1.00-3.00%						$	4					$	337					$	15					$	226					$	582
3.01-4.00%						49						—						—						—						49
Total						$	53					$	337					$	15					$	226					$	631
Universal life
1.00-3.00%						$	—					$	60					$	58					$	4					$	122
3.01-4.00%						49						5						—						—						54
Greater than 4.00%						280						—						—						—						280
Total						$	329					$	65					$	58					$	4					$	456

Additional Liability, Long-Duration Insurance

The following table shows the balances and changes in the other additional liability related to the no-lapse guarantees contained within our universal life contracts:

(Dollars in millions)									Three months ended March 31,
															2025						2024
Balance, beginning of period															$	130					$	128
Balance, beginning of period before shadow reserve adjustments															131						129
Effect of changes in cash flow assumptions															—						—
Effect of actual variances from expected experience															2						—
Adjusted beginning of period balance															133						129
Interest accrual															1						1
Excess death benefits															(7)						(2)
Attributed assessments															3						3
Effect of changes in interest rate assumptions															1						(1)
Balance, end of period before shadow reserve adjustments															131						130
Shadow reserve adjustments															(1)						(1)
Balance, end of period															130						129
Less reinsurance recoverable, end of period															8						6
Net other additional liability, after reinsurance recoverable															$	138					$	135
Weighted-average duration of the other additional liability in years															29						31

Separate Account, Liability

The following table shows balances and changes in separate accounts balances during the period:

(Dollars in millions)												Three months ended March 31,
																		2025						2024
Balance, beginning of period																		$	952					$	925
Interest credited before policy charges																		11						10
Benefit payments																		(8)						—
Other																		4						(8)
Balance, end of period																		$	959					$	927
Cash surrender value																		$	949					$	925

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Tabular disclosure of present value of total expected payment to policyholder in excess of present value of total expected assessment from application of revised benefit ratio as of contract issue date. Excludes benefit classified as market risk benefit or under provisions of Topic 815 on derivative and hedging.

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