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Derivative Instruments (Tables) | 9 Months Ended
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Sep. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Schedule of Derivative Financial Statement Location and Amounts | The notional and fair values of freestanding derivative instruments, before the effect of offset as presented in the Consolidated Statements of Financial Position, are shown below:
| Primary Underlying Risk | Location in the Consolidated Statements of Financial Position |  | September 30, 2024 |  | December 31, 2023
| Notional Amount |  | Carrying Value / Fair Value |  | Notional Amount |  | Carrying Value / Fair Value
|  | Assets |  | Liabilities |  |  | Assets |  | Liabilities
|  |  |  | (Dollars in millions)
Derivatives Designated as Hedging Instruments: |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange forwards | Foreign currency | Other invested assets, Other liabilities |  | $ | 643 |  |  | $ | — |  |  | $ | 14 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Derivatives Not Designated as Hedging Instruments: |  |  |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | Equity | Other invested assets, Other liabilities |  | 45,975 |  |  | 1,900 |  |  | 7 |  |  | 4,084 |  |  | 227 |  |  | — |
Foreign exchange forwards | Foreign currency | Other invested assets, Other liabilities |  | 921 |  |  | — |  |  | 17 |  |  | — |  |  | — |  |  | — |
Embedded Derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Indexed annuity and variable annuity product | Interest rate | Policyholders’ account balances |  | — |  |  | — |  |  | 1,771 |  |  | — |  |  | — |  |  | 873 |
Funds withheld and Modco arrangements | Interest rate | Funds withheld for reinsurance liabilities |  | — |  |  | — |  |  | 278 |  |  | — |  |  | — |  |  | — |
|  |  |  | $ | 47,539 |  |  | $ | 1,900 |  |  | $ | 2,087 |  |  | $ | 4,084 |  |  | $ | 227 |  |  | $ | 873 |
The following represents the financial statement location and amount of gains (losses) related to the derivatives and hedged items that qualify for fair value hedge accounting:
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2024 |  | 2023 |  | 2024 |  | 2023
|  | (Dollars in millions)
Hedged items |  | $ | 13 |  |  | $ | — |  |  | $ | 13 |  |  | $ | — |
Derivatives designated as hedging instruments |  | (13) |  |  | — |  |  | (13) |  |  | — |
Investment related gains (losses) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Schedule of Derivatives Instruments | The following represents the financial statement location and amount of gains (losses) related to the derivatives not designated as hedging instruments:
|  |  | Derivative Gains (Losses) Recognized in Income
|  |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
| Location in the Consolidated Statements of Operations |  | 2024 |  | 2023 |  | 2024 |  | 2023
|  |  | (Dollars in millions)
Equity-indexed options | Change in fair value of insurance-related derivatives and embedded derivatives |  | $ | 382 |  |  | $ | (31) |  |  | $ | 747 |  |  | $ | 40 |
Foreign exchange forwards | Investment related gains (losses) |  | (18) |  |  | — |  |  | (18) |  |  | — |
Embedded derivatives: |  |  |  |  |  |  |  |  |
Indexed annuity and variable annuity product | Change in fair value of insurance-related derivatives and embedded derivatives |  | (527) |  |  | (23) |  |  | (815) |  |  | (94) |
Funds withheld and Modco arrangements | Change in fair value of insurance-related derivatives and embedded derivatives |  | (199) |  |  | — |  |  | (278) |  |  | — |
|  |  | $ | (362) |  |  | $ | (54) |  |  | $ | (364) |  |  | $ | (54) |
Schedule of Derivative Instruments | The fair value of our derivatives by counterparty and each counterparty's current credit rating are as follows:
|  |  |  |  |  |  |  | September 30, 2024 |  |  |  | December 31, 2023
Counterparty |  | Credit Rating (S&P) |  | Credit Rating (Moody's) |  |  |  | Fair Value |  |  |  | Fair Value
|  |  |  |  |  |  |  | (Dollars in millions)
Bank of America |  | A+ |  | Aa1 |  |  |  | $ | 207 |  |  |  |  | $ | 24 |
Barclays |  | A+ |  | A1 |  |  |  | 67 |  |  |  |  | 24 |
Canadian Imperial Bank of Commerce |  | A+ |  | Aa2 |  |  |  | 54 |  |  |  |  | — |
Citibank, N.A. |  | A+ |  | Aa3 |  |  |  | 62 |  |  |  |  | — |
Credit Suisse |  | A- |  | A3 |  |  |  | — |  |  |  |  | 16 |
Goldman Sachs |  | A+ |  | A1 |  |  |  | 29 |  |  |  |  | — |
ING |  | A- |  | Baa1 |  |  |  | 6 |  |  |  |  | 10 |
J.P. Morgan |  | A+ |  | Aa2 |  |  |  | 254 |  |  |  |  | 12 |
Mizuho |  | A |  | A1 |  |  |  | 388 |  |  |  |  | — |
Morgan Stanley |  | A+ |  | Aa3 |  |  |  | 114 |  |  |  |  | 43 |
NATIXIS |  | A+ |  | A1 |  |  |  | 2 |  |  |  |  | 4 |
Royal Bank of Canada |  | AA- |  | A1 |  |  |  | 137 |  |  |  |  | — |
Societe Generale |  | A |  | A1 |  |  |  | 154 |  |  |  |  | — |
Truist |  | A |  | A3 |  |  |  | 115 |  |  |  |  | 59 |
UBS AG |  | A- |  | A3 |  |  |  | 67 |  |  |  |  | — |
Wells Fargo |  | A+ |  | Aa2 |  |  |  | 231 |  |  |  |  | 35 |
|  |  |  |  |  |  |  | $ | 1,887 |  |  |  |  | $ | 227 |
Schedule of Derivative Assets and Effects of Rights of Offset | Information regarding the Company’s exposure to credit loss on the derivatives it holds, including the effect of rights of offset, is presented below:
| Gross Amount of Derivative Instruments (1) |  | Gross Amount Offset in the Consolidated Statements of Financial Position (2) |  | Net Amount Presented in the Consolidated Statements of Financial Position |  | Collateral (Received) Pledged in Cash (3) |  | Collateral (Received) Pledged in Invested Assets (3) |  | Exposure of Net Collateral
| (Dollars in millions)
As of September 30, 2024 |  |  |  |  |  |  |  |  |  |  |
Derivative assets |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | 1,900 |  |  | $ | (13) |  |  | $ | 1,887 |  |  | $ | (1,827) |  |  | $ | (21) |  |  | $ | 39 |
Total derivative assets | $ | 1,900 |  |  | $ | (13) |  |  | $ | 1,887 |  |  | $ | (1,827) |  |  | $ | (21) |  |  | $ | 39 |
Derivative liabilities |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | (7) |  |  | $ | 7 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Foreign exchange forwards | (31) |  |  | 6 |  |  | (25) |  |  | — |  |  | — |  |  | (25) |
Total derivative liabilities | $ | (38) |  |  | $ | 13 |  |  | $ | (25) |  |  | $ | — |  |  | $ | — |  |  | $ | (25) |
As of December 31, 2023 |  |  |  |  |  |  |  |  |  |  |
Derivative assets |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | 227 |  |  | $ | — |  |  | $ | 227 |  |  | $ | (205) |  |  | $ | (21) |  |  | $ | 1 |
Total derivative assets | $ | 227 |  |  | $ | — |  |  | $ | 227 |  |  | $ | (205) |  |  | $ | (21) |  |  | $ | 1 |
Derivative liabilities |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Foreign exchange forwards | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total derivative liabilities | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
(1)Represents derivative assets and liabilities on a gross basis, which are not offset under enforceable master netting agreements that meet all offsetting criteria. (2)Represents netting of derivative exposures covered by qualifying master netting agreements. (3)Excludes a portion of collateral held in cash and invested assets that are excess collateral. As of September 30, 2024 and December 31, 2023, the Company held excess collateral of $24 million and $4 million, respectively.
Schedule of Derivative Liabilities and Effects of Rights of Offset | Information regarding the Company’s exposure to credit loss on the derivatives it holds, including the effect of rights of offset, is presented below:
| Gross Amount of Derivative Instruments (1) |  | Gross Amount Offset in the Consolidated Statements of Financial Position (2) |  | Net Amount Presented in the Consolidated Statements of Financial Position |  | Collateral (Received) Pledged in Cash (3) |  | Collateral (Received) Pledged in Invested Assets (3) |  | Exposure of Net Collateral
| (Dollars in millions)
As of September 30, 2024 |  |  |  |  |  |  |  |  |  |  |
Derivative assets |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | 1,900 |  |  | $ | (13) |  |  | $ | 1,887 |  |  | $ | (1,827) |  |  | $ | (21) |  |  | $ | 39 |
Total derivative assets | $ | 1,900 |  |  | $ | (13) |  |  | $ | 1,887 |  |  | $ | (1,827) |  |  | $ | (21) |  |  | $ | 39 |
Derivative liabilities |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | (7) |  |  | $ | 7 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Foreign exchange forwards | (31) |  |  | 6 |  |  | (25) |  |  | — |  |  | — |  |  | (25) |
Total derivative liabilities | $ | (38) |  |  | $ | 13 |  |  | $ | (25) |  |  | $ | — |  |  | $ | — |  |  | $ | (25) |
As of December 31, 2023 |  |  |  |  |  |  |  |  |  |  |
Derivative assets |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | 227 |  |  | $ | — |  |  | $ | 227 |  |  | $ | (205) |  |  | $ | (21) |  |  | $ | 1 |
Total derivative assets | $ | 227 |  |  | $ | — |  |  | $ | 227 |  |  | $ | (205) |  |  | $ | (21) |  |  | $ | 1 |
Derivative liabilities |  |  |  |  |  |  |  |  |  |  |
Equity-indexed options | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Foreign exchange forwards | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total derivative liabilities | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
(1)Represents derivative assets and liabilities on a gross basis, which are not offset under enforceable master netting agreements that meet all offsetting criteria. (2)Represents netting of derivative exposures covered by qualifying master netting agreements. (3)Excludes a portion of collateral held in cash and invested assets that are excess collateral. As of September 30, 2024 and December 31, 2023, the Company held excess collateral of $24 million and $4 million, respectively.

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