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Financial Services, Insurance, ASU 2018-12 Transition (Tables)

3 Months Ended

Mar. 31, 2023

ASU 2018-12 Transition [Abstract]

Accounting Standards Update and Change in Accounting Principle [Table Text Block]

The effect of transition adjustments on stockholders’ equity at January 1, 2021 due to the adoption of ASU 2018-12 was as follows:

						Retained Earnings (Deficit)						AOCI
						(In millions)
Liability for future policy benefits						$	(436)					$	(2,073)
Market risk benefits and related adjustments						(6,237)						(3,454)
DAC and VOBA						—						520
Reinsurance recoverables						(141)						34
Deferred income tax asset						1,431						1,044
Total						$	(5,383)					$	(3,929)

The balances of and changes in LFPBs at January 1, 2021 due to the adoption of ASU 2018-12 were as follows:

						Term and Whole Life Insurance						Income Annuities						Structured Settlement and Pension Risk Transfer Annuities
						(In millions)
Balance at December 31, 2020						$	2,854					$	4,311					$	10,115
Removal of related balances in AOCI						—						(203)						(1,784)
Change in cash flow assumptions						14						(171)						200
Initial recognition of deferred profit liabilities						—						176						217
Change in discount rate assumptions						536						754						2,770
Adjusted balance at January 1, 2021						3,404						4,867						11,518
Less: Reinsurance recoverable						85						29						102
Adjusted balance at January 1, 2021, net of reinsurance						$	3,319					$	4,838					$	11,416

The balance of and changes in liabilities classified as MRBs at January 1, 2021 due to the adoption of ASU 2018-12 were as follows:

						Variable Annuities
						(In millions)
Balance at December 31, 2020						$	8,924
Adjustment for the difference between carrying amount and estimated fair value, except for the difference due to nonperformance risk						6,010
Adjustment for cumulative effect of changes in nonperformance risk since issuance						3,454
Adjusted balance at January 1, 2021						18,388
Less: Reinsurance recoverable						169
Adjusted balance at January 1, 2021, net of reinsurance						$	18,219

The balances of and changes in DAC and VOBA on January 1, 2021 due to the adoption of ASU 2018-12 were as follows:

						Variable Annuities						Fixed Rate Annuities						Index-Linked Annuities						Term and Whole Life Insurance						Universal Life Insurance
						(In millions)
DAC:
Balance at December 31, 2020						$	2,440					$	64					$	886					$	527					$	492
Removal of related amounts in AOCI						472						—						—						—						(23)
Adjusted balance at January 1, 2021						$	2,912					$	64					$	886					$	527					$	469
VOBA:
Balance at December 31, 2020						$	363					$	76					$	—					$	8					$	55
Removal of related amounts in AOCI						65						—						—						—						6
Adjusted balance at January 1, 2021						$	428					$	76					$	—					$	8					$	61

The following tables present amounts previously reported in 2022 and 2021, the effect on those amounts of the change due to the adoption of ASU 2018-12 as described in Note 1, and the currently reported amounts in the Unaudited Interim Consolidated Balance Sheets and Unaudited Interim Consolidated Statements of Operations and Comprehensive Income (Loss). See Notes 4 and 5 for more information.

						December 31, 2022																		December 31, 2021
						As Previously Reported						Effect of Change						As Currently Reported						As Previously Reported						Effect of Change						As Currently Reported
						(In millions)
Total assets						$	225,580					$	(733)					$	224,847					$	259,840					$	2,417					$	262,257
Future policy benefits						$	41,569					$	(10,072)					$	31,497					$	43,807					$	(3,817)					$	39,990
Policyholder account balances						$	74,836					$	(1,309)					$	73,527					$	66,851					$	(1,602)					$	65,249
Market risk benefit liabilities						$	—					$	10,389					$	10,389					$	—					$	16,034					$	16,034
Total liabilities						$	219,542					$	(293)					$	219,249					$	243,633					$	10,174					$	253,807
Retained earnings (deficit)						$	(637)					$	242					$	(395)					$	(642)					$	(3,632)					$	(4,274)
Accumulated other comprehensive income (loss)						$	(5,424)					$	(682)					$	(6,106)					$	4,172					$	(4,125)					$	47
Total equity						$	6,038					$	(440)					$	5,598					$	16,207					$	(7,757)					$	8,450
Total liabilities and equity						$	225,580					$	(733)					$	224,847					$	259,840					$	2,417					$	262,257

						Year Ended December 31, 2022																		Year Ended December 31, 2021
						As Previously Reported						Effect of Change						As Currently Reported						As Previously Reported						Effect of Change						As Currently Reported
						(In millions)
Universal life and investment-type product policy fees						$	3,141					$	(706)					$	2,435					$	3,636					$	(656)					$	2,980
Net derivative gains (losses)						$	304					$	(896)					$	(592)					$	(2,469)					$	(1,514)					$	(3,983)
Total revenues						$	8,473					$	(1,600)					$	6,873					$	7,142					$	(2,166)					$	4,976
Policyholder benefits and claims						$	4,165					$	(1,972)					$	2,193					$	3,443					$	(697)					$	2,746
Change in market risk benefits						$	—					$	(4,104)					$	(4,104)					$	—					$	(4,134)					$	(4,134)
Total expenses						$	8,645					$	(6,504)					$	2,141					$	7,350					$	(4,383)					$	2,967
Net income (loss)						$	10					$	3,874					$	3,884					$	(103)					$	1,751					$	1,648

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- Definition

Tabular disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-3

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-Name Accounting Standards Codification
-Topic 250
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Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Name Accounting Standards Codification
-Topic 270
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-Section 45
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482989/270-10-45-12

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-Name Accounting Standards Codification
-Topic 270
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482989/270-10-45-13

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