XML 49 R37.htm IDEA: XBRL DOCUMENT

Market Risk Benefits (Tables)

6 Months Ended

Jun. 30, 2024

Summary of disaggregated MRB amounts in an asset and liability position (Table)


	June 30, 2024						December 31, 2023
					Net asset						Net asset
	Asset		Liability		(liability)		Asset		Liability		(liability)

	(in millions)
Retirement and Income Solutions:
Individual variable annuities	$	212.3	$	69.3	$	143.0	$	153.4	$	111.9	$	41.5
Principal Asset Management – Principal International:
Asia:
Guaranteed pension (1)		—		—		—		—		21.3		(21.3)
Total MRB per consolidated statements of financial position	$	212.3	$	69.3	$	143.0	$	153.4	$	133.2	$	20.2

(1)The guaranteed pension funds were closed in the second quarter of 2024.

Summary of quantitative information about the significant unobservable inputs used for fair value measurements of MRBs (Table)


	June 30, 2024						December 31, 2023
					Weighted-						Weighted-
	Range of inputs				Average		Range of inputs				Average
Retirement and Income Solutions:
Individual variable annuities
Long-term interest rate (1)	4.51	-	4.60	%	4.55	%	4.00	-	4.20	%	4.10	%
Long-term equity market volatility	18.30	-	32.80	%	21.50	%	18.00	-	33.00	%	22.00	%
Nonperformance risk	0.57	-	1.29	%	1.10	%	0.80	-	1.60	%	1.30	%
Lapse rate	1.10	-	55.00	%	6.16	%	1.10	-	55.00	%	5.90	%
Principal Asset Management – Principal International:
Asia:
Guaranteed pension (2)
Long-term interest rate (1)	N/A		N/A		N/A		4.54	-	4.70	%	4.61	%
Long-term equity market volatility	N/A		N/A		N/A		16.39	-	23.75	%	19.64	%
Nonperformance risk	N/A		N/A		N/A		0.90	-	1.77	%	1.51	%
Lapse rate	N/A		N/A		N/A		4.95	-	19.35	%	16.80	%

(1)	Represents the range of rate curves used in the valuation analysis that we have determined market participants would use when pricing the instrument. The rate curves are derived from an interpolation between various observable swap rates.

(2)	The guaranteed pension funds were closed in the second quarter of 2024.

Retirement and Income Solutions

Market Risk Benefits

Summary of significant changes to inputs and assumptions that impacted the change in the MRB fair value measurement (Table)

	For the six months ended		For the year ended
	June 30, 2024		December 31, 2023
		Change in net		Change in net
	Change in input	MRB asset (liability)	Change in input	MRB asset (liability)
Long-term interest rate	Increased	Favorable	Increased	Favorable
Equity markets	Increased	Favorable	Increased	Favorable
Equity market volatilities	Decreased	Favorable	Decreased	Favorable
Own nonperformance risk	Decreased	Unfavorable	Decreased	Unfavorable

Retirement and Income Solutions | Individual variable annuities

Market Risk Benefits

Summary of net asset (liability) balances and the changes in the valuation of the MRBs (Table)

The net asset (liability) balances and the changes in the valuation of the MRBs for Individual variable annuities were as follows:


	For the six months ended		For the year ended
	June 30, 2024		December 31, 2023

	($ in millions)
Balance at beginning of period	$	41.5	$	(72.2)
Effect of changes in nonperformance risk at beginning of period		7.7		(31.7)
Adjusted balance at beginning of period		49.2		(103.9)
Effect of:
Interest accrual and expected policyholder behavior		(39.3)		(80.9)
Benefit payments		0.5		0.4
Changes in interest rates		68.9		39.9
Changes in equity markets		66.2		155.1
Changes in equity index volatility		19.3		47.9
Actual policyholder behavior different from expected behavior		(3.5)		(4.0)
Changes in other future expected assumptions		—		(5.3)
Adjusted balance at end of period		161.3		49.2
Effect of changes in nonperformance risk at end of period		(18.3)		(7.7)
Balance at end of period	$	143.0	$	41.5

Weighted-average attained age of policyholders (years) (1)		67.6		67.7
Net amount at risk (2)	$	50.0	$	111.2

(1)	The weighted-average attained age is calculated at the contract level using the total contributions since inception and the age of the contractholders.

(2)

The net amount at risk for our GMDB riders is defined as the current GMDB amount in excess of the current account balance. The net amount at risk for our GMWB riders is defined as the greater of the present value of the GMWB payments less the current account balance or zero. For contracts with both GMDB and GMWB riders, the net amount at risk is the greater of the GMDB or GMWB net amount at risk. A decrease in the net amount at risk in 2024 as a result of increases in the equity markets was partially offset by an increase in the net amount at risk as a result of increases in interest rates.

Principal Asset Management | Principal International | Asia | Guaranteed pension

Market Risk Benefits

Summary of net asset (liability) balances and the changes in the valuation of the MRBs (Table)

The net asset (liability) balances and the changes in the valuation of the MRBs for Asia – Guaranteed pension were as follows:


	For the six months ended		For the year ended
	June 30, 2024		December 31, 2023

	($ in millions)
Balance at beginning of period	$	(21.3)	$	(26.0)
Effect of changes in nonperformance risk at beginning of period		1.0		1.2
Adjusted balance at beginning of period		(20.3)		(24.8)
Effect of:
Interest accrual and expected policyholder behavior		(0.2)		(10.1)
Benefit payments (1)		20.2		13.8
Changes in interest rates		(0.6)		1.2
Changes in equity markets		0.7		0.2
Actual policyholder behavior different from expected behavior		0.2		(0.6)
Adjusted balance at end of period		—		(20.3)
Effect of changes in nonperformance risk at end of period		—		(1.0)
Balance at end of period	$	—	$	(21.3)

Weighted-average attained age of policyholders (years) (2)		—		54.0
Net amount at risk (3)	$	—	$	25.1

(1)	The guaranteed pension funds were closed in the second quarter of 2024.

(2)	The weighted-average attained age is calculated at the contract level using the guarantee amounts and the age of the underlying members of the contracts.

(3)	The net amount at risk for the minimum guarantee on withdrawal is defined as the current guaranteed balance in excess of the current account balance.