Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-32630 | |
Entity Registrant Name | FIDELITY NATIONAL FINANCIAL, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1725106 | |
Entity Address, Address Line One | 601 Riverside Avenue | |
Entity Address, City or Town | Jacksonville | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 32204 | |
City Area Code | 904 | |
Local Phone Number | 854-8100 | |
Title of 12(b) Security | FNF Common Stock, $0.0001 par value | |
Trading Symbol | FNF | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 289,052,633 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001331875 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Investments: | ||
Fixed maturity securities available for sale, at fair value, at March 31, 2021 and December 31, 2020, net of allowance for credit losses of $7 and $19, respectively, and includes pledged fixed maturity securities of $460 and $455, respectively, related to secured trust deposits | $ 27,718 | $ 27,587 |
Derivative investments | 542 | 548 |
Mortgage loans, net of allowance for credit losses of $36 and $39 at March 31, 2021 and December 31, 2020, respectively | 2,374 | 2,031 |
Investments in unconsolidated affiliates | 1,424 | 1,294 |
Other long-term investments | 481 | 482 |
Short-term investments, at March 31, 2021 and December 31, 2020 includes pledged short-term investments of $1 and $1, respectively, related to secured trust deposits | 124 | 769 |
Total investments | 35,392 | 35,047 |
Cash and cash equivalents, at March 31, 2021 and December 31, 2020 includes $283 and $270, respectively, of pledged cash related to secured trust deposits | 3,026 | 2,719 |
Trade and notes receivables, net of allowance of $26 and $28 at March 31, 2021 and December 31, 2020, respectively | 425 | 437 |
Reinsurance recoverable, net of allowance for credit losses of $21 and $21 at March 31, 2021 and December 31, 2020, respectively | 3,465 | 3,211 |
Goodwill | 4,498 | 4,495 |
Prepaid expenses and other assets | 1,041 | 997 |
Lease assets | 358 | 374 |
Other intangible assets, net | 2,393 | 2,264 |
Title plants | 401 | 404 |
Property and equipment, net | 179 | 180 |
Assets of discontinued operations | 311 | 327 |
Total assets | 51,489 | 50,455 |
Liabilities: | ||
Contractholder funds | 29,592 | 28,718 |
Future policy benefits | 3,959 | 4,010 |
Accounts payable and accrued liabilities | 2,469 | 2,402 |
Notes payable | 2,663 | 2,662 |
Reserve for title claim losses | 1,683 | 1,623 |
Funds withheld for reinsurance liabilities | 1,026 | 806 |
Secured trust deposits | 733 | 711 |
Lease liabilities | 398 | 414 |
Income taxes payable | 142 | 56 |
Deferred tax liability | 259 | 300 |
Liabilities of discontinued operations | 339 | 361 |
Total liabilities | 43,263 | 42,063 |
Equity: | ||
FNF common stock, $0.0001 par value; authorized 600,000,000 shares as of March 31, 2021 and December 31, 2020; outstanding of 289,328,879 and 291,448,627 as of March 31, 2021 and December 31, 2020, respectively, and issued of 323,303,805 and 322,622,948 as of March 31, 2021 and December 31, 2020, respectively | 0 | 0 |
Preferred stock, $0.0001 par value; authorized 50,000,000 shares; issued and outstanding, none | 0 | 0 |
Additional paid-in capital | 5,752 | 5,720 |
Retained earnings | 2,893 | 2,394 |
Accumulated other comprehensive earnings | 720 | 1,304 |
Less: Treasury stock, 33,974,926 shares and 31,174,321 shares as of March 31, 2021 and December 31, 2020, respectively, at cost | (1,179) | (1,067) |
Total Fidelity National Financial, Inc. shareholders’ equity | 8,186 | 8,351 |
Non-controlling interests | 40 | 41 |
Total equity | 8,226 | 8,392 |
Total liabilities and equity | 51,489 | 50,455 |
Preferred securities | ||
Investments: | ||
Securities, at fair value | 1,293 | 1,341 |
Equity securities | ||
Investments: | ||
Securities, at fair value | $ 1,436 | $ 995 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Available for sale securities, allowance for credit losses | $ 7 | $ 19 |
Available-for-sale securities, pledged securities, secured trust deposits | 460 | 455 |
Allowance for credit loss | 36 | 39 |
Short-term investments, pledged, secured trust deposits | 1 | 1 |
Cash, pledged, secured trust deposits | 283 | 270 |
Allowance for doubtful accounts, premiums and other receivables | 26 | 28 |
Expected credit losses on reinsurance recoverable | $ 21 | $ 21 |
Common stock, par or stated value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 600,000,000 | 600,000,000 |
Common stock, shares, outstanding (in shares) | 289,328,879 | 291,448,627 |
Common stock, shares, issued (in shares) | 323,303,805 | 322,622,948 |
Preferred stock, par or stated value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Treasury stock (in shares) | 33,974,926 | 31,174,321 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues: | ||
Direct title insurance premiums | $ 746 | $ 546 |
Agency title insurance premiums | 1,058 | 732 |
Escrow, title-related and other fees | 851 | 601 |
Interest and investment income | 402 | 53 |
Recognized gains and losses, net | 43 | (320) |
Total revenues | 3,100 | 1,612 |
Expenses: | ||
Personnel costs | 812 | 614 |
Agent commissions | 807 | 560 |
Other operating expenses | 458 | 411 |
Benefits and other changes in policy reserves | (26) | 0 |
Depreciation and amortization | 183 | 43 |
Provision for title claim losses | 81 | 58 |
Interest expense | 28 | 12 |
Total expenses | 2,343 | 1,698 |
Earnings (loss) from continuing operations before income taxes and equity in earnings of unconsolidated affiliates | 757 | (86) |
Income tax expense (benefit) | 166 | (28) |
Earnings (loss) before equity in earnings of unconsolidated affiliates | 591 | (58) |
Equity in earnings of unconsolidated affiliates | 13 | 1 |
Net earnings (loss) from continuing operations | 604 | (57) |
Net earnings from discontinued operations, net of tax | 5 | 0 |
Net earnings (loss) | 609 | (57) |
Less: Net earnings attributable to non-controlling interests | 4 | 4 |
Net earnings (loss) attributable to Fidelity National Financial, Inc. common shareholders | $ 605 | $ (61) |
Basic | ||
Net earnings (loss) per share from continuing operations attributable to common shareholders (in usd per share) | $ 2.07 | $ (0.22) |
Net earnings per share from discontinued operations attributable to common shareholders (in usd per share) | 0.02 | 0 |
Net earnings (loss) per share attributable to common shareholders, basic (in usd per share) | 2.09 | (0.22) |
Diluted | ||
Net earnings (loss) per share from continuing operations attributable to common shareholders (in usd per share) | 2.06 | (0.22) |
Net earnings per share from discontinued operations attributable to common shareholders (in usd per share) | 0.02 | 0 |
Net earnings (loss) per share attributable to common shareholders, diluted (in usd per share) | $ 2.08 | $ (0.22) |
Weighted average common shares outstanding - basic (in shares) | 289 | 274 |
Weighted average common shares outstanding - diluted (in shares) | 291 | 274 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Statement of Comprehensive Income [Abstract] | |||
Net earnings (loss) | $ 609 | $ (57) | |
Other comprehensive loss: | |||
Unrealized gain (loss) on investments and other financial instruments, net of adjustments to intangible assets and unearned revenue (excluding investments in unconsolidated affiliates) | [1] | (545) | (9) |
Unrealized gain on investments in unconsolidated affiliates | [2] | 9 | 7 |
Unrealized loss on foreign currency translation | [3] | (2) | (10) |
Reclassification adjustments for change in unrealized gains and losses included in net earnings | [4] | (46) | (3) |
Other comprehensive loss | (584) | (15) | |
Comprehensive earnings (loss) | 25 | (72) | |
Less: Comprehensive earnings (loss) attributable to non-controlling interests | 4 | 4 | |
Comprehensive earnings (loss) attributable to Fidelity National Financial, Inc. common shareholders | $ 21 | $ (76) | |
[1] | Net of income tax benefit of $146 million and $3 million for the three-month periods ended March 31, 2021 and 2020, respectively. | ||
[2] | Net of income tax expense of $3 million and $2 million for the three-month periods ended March 31, 2021 and 2020, respectively. | ||
[3] | Net of income tax benefit of $3 million for the three-month period ended March 31, 2020. | ||
[4] | Net of income tax expense of $12 million and $1 million for the three-month periods ended March 31, 2021 and 2020, respectively. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized loss on investments and other financial instruments, tax benefit | $ 146 | $ 3 |
Unrealized gain on investments in unconsolidated affiliates tax expense | 3 | 2 |
Unrealized loss foreign currency translation, tax benefit | 3 | |
Reclassification adjustments for change in unrealized gains and losses included in net earnings, tax expense | $ 12 | $ 1 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Earnings (Loss) | Treasury Stock | Non-controlling Interest | |
Beginning balance (in shares) at Dec. 31, 2019 | 292 | 17 | ||||||
Beginning balance at Dec. 31, 2019 | $ 5,365 | $ 0 | $ 4,581 | $ 1,356 | $ 43 | $ (598) | $ (17) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Exercise of stock options | 2 | 2 | ||||||
Treasury stock repurchased (in shares) | 3 | |||||||
Treasury stock repurchased | (94) | $ (94) | ||||||
Other comprehensive loss — unrealized loss on investments and other financial instruments | (9) | (9) | ||||||
Other comprehensive earnings — unrealized gain on investments in unconsolidated affiliates | 7 | [1] | 7 | |||||
Other comprehensive earnings - unrealized loss on foreign currency translation | (10) | [2] | (10) | |||||
Reclassification adjustments for change in unrealized gains and losses included in net earnings | (3) | [3] | (3) | |||||
Stock-based compensation | 9 | 9 | ||||||
Dividends declared, per common share | (91) | (91) | ||||||
Subsidiary dividends declared to non-controlling interests | (3) | (3) | ||||||
Net earnings (loss) | (57) | (61) | 4 | |||||
Ending balance (in shares) at Mar. 31, 2020 | 292 | 20 | ||||||
Ending balance at Mar. 31, 2020 | 5,116 | $ 0 | 4,592 | 1,204 | 28 | $ (692) | (16) | |
Beginning Balance at Dec. 31, 2019 | 344 | |||||||
Ending Balance at Mar. 31, 2020 | 344 | |||||||
Beginning balance (in shares) at Dec. 31, 2020 | 322 | 31 | ||||||
Beginning balance at Dec. 31, 2020 | 8,392 | $ 0 | 5,720 | 2,394 | 1,304 | $ (1,067) | 41 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Exercise of stock options (in shares) | 1 | |||||||
Exercise of stock options | 21 | 21 | ||||||
Treasury stock repurchased (in shares) | 3 | |||||||
Treasury stock repurchased | (112) | $ (112) | ||||||
Other comprehensive loss — unrealized loss on investments and other financial instruments | (545) | |||||||
Other comprehensive earnings — unrealized gain on investments in unconsolidated affiliates | 9 | [1] | 9 | |||||
Other comprehensive earnings - unrealized loss on foreign currency translation | (2) | [2] | (2) | |||||
Reclassification adjustments for change in unrealized gains and losses included in net earnings | (46) | [3] | (46) | |||||
Stock-based compensation | 11 | 11 | ||||||
Dividends declared, per common share | (106) | (106) | ||||||
Subsidiary dividends declared to non-controlling interests | (5) | (5) | ||||||
Net earnings (loss) | 609 | 605 | 4 | |||||
Ending balance (in shares) at Mar. 31, 2021 | 323 | 34 | ||||||
Ending balance at Mar. 31, 2021 | 8,226 | $ 0 | $ 5,752 | $ 2,893 | $ 720 | $ (1,179) | $ 40 | |
Beginning Balance at Dec. 31, 2020 | 0 | |||||||
Ending Balance at Mar. 31, 2021 | $ 0 | |||||||
[1] | Net of income tax expense of $3 million and $2 million for the three-month periods ended March 31, 2021 and 2020, respectively. | |||||||
[2] | Net of income tax benefit of $3 million for the three-month period ended March 31, 2020. | |||||||
[3] | Net of income tax expense of $12 million and $1 million for the three-month periods ended March 31, 2021 and 2020, respectively. |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividend per common share (in dollars per share) | $ 0.36 | $ 0.33 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 609 | $ (57) |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 183 | 43 |
Equity in earnings of unconsolidated affiliates | (13) | (1) |
(Gain) loss on sales of investments and other assets and asset impairments, net | (71) | 8 |
Interest credited/index credits to contractholder account balances | (62) | 0 |
Deferred policy acquisition costs and deferred sales inducements | (134) | 0 |
Charges assessed to contractholders for mortality and admin | (41) | 0 |
Non-cash lease costs | 34 | 37 |
Operating lease payments | (38) | (38) |
Distributions from unconsolidated affiliates, return on investment | 7 | 0 |
Stock-based compensation cost | 11 | 9 |
Change in valuation of derivatives, equity and preferred securities, net | (18) | 312 |
Changes in assets and liabilities, net of effects from acquisitions: | ||
Change in insurance recoverable | (38) | 0 |
Change in future policy benefits | (51) | 0 |
Change in funds withheld from reinsurers | 217 | 0 |
Net decrease in trade receivables | 14 | 20 |
Net increase in reserve for title claim losses | 60 | 9 |
Net change in income taxes | 144 | (32) |
Net change in other assets and other liabilities | (148) | (205) |
Net cash provided by (used in) operating activities | 665 | 105 |
Cash flows from investing activities: | ||
Proceeds from sales, calls and maturities of investment securities | 1,586 | 265 |
Proceeds from sales of property and equipment | 0 | 9 |
Additions to property and equipment and capitalized software | (22) | (28) |
Purchases of investment securities | (3,283) | (300) |
Net proceeds from (purchases of) sales and maturities of short-term investment securities | 645 | (382) |
Acquisitions/disposals of businesses, net of cash acquired/disposed | (5) | 0 |
Additional investments in unconsolidated affiliates | (1) | (9) |
Distributions from unconsolidated affiliates, return of investment | 24 | 2 |
Net other investing activities | (4) | 4 |
Net cash provided by (used in) investing activities | (1,060) | (439) |
Cash flows from financing activities: | ||
Dividends paid | (104) | (90) |
Subsidiary dividends paid to non-controlling interest shareholders | (5) | (3) |
Exercise of stock options | 21 | 2 |
Net change in secured trust deposits | 23 | 35 |
Payment of contingent consideration for prior period acquisitions | (2) | (7) |
Contractholder account deposits | 1,522 | 0 |
Contractholder account withdrawals | (641) | 0 |
Purchases of treasury stock | (112) | (89) |
Net cash provided by (used in) financing activities | 702 | (152) |
Net increase (decrease) in cash and cash equivalents | 307 | (486) |
Cash and cash equivalents at beginning of period | 2,719 | 1,376 |
Cash and cash equivalents at end of period | $ 3,026 | $ 890 |
Basis of Financial Statements
Basis of Financial Statements | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | Basis of Financial Statements The financial information in this report presented for interim periods is unaudited and includes the accounts of Fidelity National Financial, Inc. and its subsidiaries (collectively, “we,” “us,” “our,” the "Company" or “FNF”) prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All adjustments made were of a normal, recurring nature. This report should be read in conjunction with our Annual Report on Form 10-K (our "Annual Report") for the year ended December 31, 2020. Description of the Business We are a leading provider of (i) title insurance, escrow and other title-related services, including trust activities, trustee sales guarantees, recordings and reconveyances and home warranty products, (ii) technology and transaction services to the real estate and mortgage industries and (iii) annuity and life insurance products. FNF is one of the nation’s largest title insurance companies operating through its title insurance underwriters - Fidelity National Title Insurance Company ("FNTIC"), Chicago Title Insurance Company ("Chicago Title"), Commonwealth Land Title Insurance Company ("Commonwealth Title"), Alamo Title Insurance and National Title Insurance of New York Inc. - which collectively issue more title insurance policies than any other title company in the United States. Through our subsidiary, ServiceLink Holdings, LLC ("ServiceLink"), we provide mortgage transaction services, including title-related services and facilitation of production and management of mortgage loans. We are also a provider of annuity and life insurance products, providing deferred annuities, including fixed index annuities ("FIA"), fixed rate annuities, and immediate annuities and indexed universal life ("IUL") insurance through our wholly-owned subsidiary, F&G Annuities & Life ("F&G"). For information about our reportable segments refe r to Note H Segment Information . Recent Developments Merger of Paysafe Limited ("Paysafe") and Foley Trasimene Acquisition Corp. II ("FTAC II") On December 7, 2020, each of our wholly-owned subsidiaries, FNTIC, Commonwealth Title, Chicago Title and F&G (collectively, the "FTAC II Subscribers"), entered into common stock subscription agreements with Paysafe and FTAC II to purchase in the aggregate $500 million (the "Purchase Price") of common shares, par value $0.001 per share, of Paysafe at a purchase price of $10.00 per share ("the PIPE Investment"). On March 30, 2021, FTAC II merged with Paysafe, an exempted limited company incorporated under the laws of Bermuda and a leading integrated payments platform (the "FTAC II Paysafe Merger"), in accordance with the agreement and plan of merger dated December 7, 2020. The newly combined company operates as Paysafe and is traded on the New York Stock Exchange ("NYSE") under the symbol PSFE. The FTAC II Paysafe Merger was funded with the cash held in trust at FTAC II, forward purchase commitments, private investment in public equity ("PIPE") commitments and equity of Paysafe. On March 30, 2021, the FTAC II Subscribers funded the subscription agreements and received 50 million common shares of Paysafe. As of March 31, 2021, we hold approximately 7% of the outstanding common shares of Paysafe. In connection with the PIPE Investment, we received a fee of 1.6% of the Purchase Price as described in the agreement and plan of merger dated December 7, 2020. Income Tax Income tax expense (benefit) was $166 million and $(28) million in the three-month periods ended March 31, 2021 and 2020, respectively. Income tax expense as a percentage of earnings before income taxes was 22% in the three months ended March 31, 2021. Income tax benefit as a percentage of loss before income taxes was 33% in the three months ended March 31, 2020. The 2020 period includes an additional tax benefit of $7 million related to a 2017 amended return filed in the three months ended March 31, 2020. Earnings Per Share Basic earnings per share, as presented on the Condensed Consolidated Statement of Earnings, is computed by dividing net earnings available to common shareholders in a given period by the weighted average number of common shares outstanding during such period. In periods when earnings are positive, diluted earnings per share is calculated by dividing net earnings available to common shareholders by the weighted average number of common shares outstanding plus the impact of assumed conversions of potentially dilutive securities. For periods when we recognize a net loss, diluted earnings per share is equal to basic earnings per share as the impact of assumed conversions of potentially dilutive securities is considered to be antidilutive. We have granted certain stock options, shares of restricted stock and certain other convertible share based payments which have been treated as common share equivalents for purposes of calculating diluted earnings per share for periods in which positive earnings have been reported. Options or other instruments which provide the ability to purchase shares of our common stock that are antidilutive are excluded from the computation of diluted earnings per share. There were 1 million and 3 million antidilutive instruments outstanding during the three months ended March 31, 2021 and 2020, respectively. Discontinued Operations In connection with the F&G acquisition, certain third party offshore reinsurance businesses acquired were deemed discontinued operations and are presented as such within our Condensed Consolidated Statements of Earnings for the three months ended March 31, 2021. Recent Accounting Pronouncements Adopted Pronouncements In December 2019, the FASB issued ASU 2019-12 Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740), which simplifies various aspects of the income tax accounting guidance and will be applied using different approaches depending on what the specific amendment relates to and, for public entities, are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We adopted this standard as of January 1, 2021, and it had no impact on our unaudited Condensed Consolidated Financial Statements upon adoption. In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20, Receivables - Nonrefundable Fees and Other Costs. The amendments in this update clarify that callable debt securities should be re-evaluated each reporting period to determine if the amortized cost exceeds the amount repayable by the issuer at the next earliest call date, and, if so, the excess should be amortized to the next call date. We adopted this standard as of January 1, 2021 and are applying this guidance on a prospective basis. This pronouncement had no impact on our unaudited Condensed Consolidated Financial Statements upon adoption. Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-12, Financial Services-Insurance (Topic 944), Targeted Improvements to the Accounting for Long-Duration Contracts, effective for fiscal years beginning after December 15, 2022 including interim periods within those fiscal years. This update introduced the following requirements: assumptions used to measure cash flows for traditional and limited-payment contracts must be reviewed at least annually with the effect of changes in those assumptions being recognized in the statement of operations; the discount rate applied to measure the liability for future policy benefits and limited-payment contracts must be updated at each reporting date with the effect of changes in the rate being recognized in other comprehensive income; market risk benefits associated with deposit contracts must be measured at fair value, with the effect of the change in the fair value attributable to a change in the instrument-specific credit risk being recognized in other comprehensive income; deferred acquisition costs are required to be amortized in proportion to premiums, gross profits, or gross margins and those balances must be amortized on a constant level basis over the expected term of the related contracts; deferred acquisition costs must be written off for unexpected contract terminations; and disaggregated rollforwards of beginning to ending balances of the liability for future policy benefits, policyholder account balances, market risk benefits, separate account liabilities and deferred acquisition costs, as well as information about significant inputs, judgments, assumptions, and methods used in measurement are required to be disclosed. The amendments in this ASU may be early adopted as of the beginning of an annual reporting period for which financial statements have not yet been issued, including interim financial statements. We do not currently expect to early adopt this standard. We have identified specific areas that will be impacted by the new guidance and are in the process of assessing the accounting, reporting and/or process changes that will be required to comply as well as the impact of the new guidance on our consolidated financial statements. |
Summary of Reserve for Title Cl
Summary of Reserve for Title Claim Losses | 3 Months Ended |
Mar. 31, 2021 | |
Insurance [Abstract] | |
Summary of Reserve for Title Claim Losses | Summary of Reserve for Title Claim Losses A summary of the reserve for title claim losses follows: Three months ended March 31, 2021 2020 (Dollars in millions) Beginning balance $ 1,623 $ 1,509 Change in insurance recoverable 25 (1) Claim loss provision related to: Current year 81 58 Prior years — — Total title claim loss provision 81 58 Claims paid, net of recoupments related to: Current year — — Prior years (46) (48) Total title claims paid, net of recoupments (46) (48) Ending balance of claim loss reserve for title insurance $ 1,683 $ 1,518 Provision for title insurance claim losses as a percentage of title insurance premiums 4.5 % 4.5 % Several lawsuits have been filed by various parties against Chicago Title Company and Chicago Title Insurance Company as its alter ego (collectively, the “Named Companies”), among others. Generally, plaintiffs claim they are investors who were solicited by Gina Champion-Cain to provide funds that purportedly were to be used for high-interest, short-term loans to parties seeking to acquire California alcoholic beverage licenses. Plaintiffs contend that under California state law, alcoholic beverage license applicants are required to escrow an amount equal to the license purchase price while their applications remain pending with the State. Plaintiffs further alleged that employees of Chicago Title Company participated with Ms. Champion-Cain and her entities in a fraud scheme involving an escrow account maintained by Chicago Title Company into which the plaintiffs’ funds were deposited. The Named Companies have settled or conditionally settled with various parties and/or are participating in court-ordered mediation with all other parties in an effort to fully resolve the claims related to this matter. The following lawsuits were filed in the Superior Court of San Diego County for the State of California. While they have not been consolidated into one action, they have been deemed by the court to be related and are assigned to the same judge for purposes of judicial economy. Unless otherwise noted below, the Named Companies have or will respond to the operative complaints by the respective due dates. On December 13, 2019, a lawsuit styled, Kim Funding, LLC, Kim H. Peterson, Joseph J. Cohen, and ABC Funding Strategies, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in San Diego County Superior Court. Plaintiffs claim losses of more than $250 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. The Named Companies have filed a cross-complaint against Ms. Champion-Cain, among others. On March 6, 2020, a lawsuit styled, Wakefield Capital, LLC, Wakefield Investments, LLC, 2Budz Holding, LLC, Doug and Kristine Heidrich, and Jeff and Heidi Orr v. Chicago Title Co. and Chicago Title Ins. Co., was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $7 million as a result of the alleged fraud scheme, and also seek punitive damages, recovery of attorneys’ fees, and disgorgement. On March 16, 2020, a lawsuit styled, Randolph L. Levin, et al., v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, Betty Elixman, et al., was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $38 million as a result of the alleged fraud scheme, and also seek punitive damages and the recovery of attorneys’ fees. This matter has conditionally settled under confidential terms following mediation. On May 29, 2020, a lawsuit styled, Mark Atherton, et al., v. Chicago Title Co. and Chicago Title Ins. Co., was filed in was filed in San Diego County Superior Court. Plaintiffs claim losses of more than $30 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages, as well as the recovery of attorneys’ fees. This matter has conditionally settled under confidential terms. On June 29, 2020, a lawsuit styled, Susan Heller Fenley Separate Property Trust, DTD 03/04/2010, Susan Heller Fenley Inherited Roth IRA, Shelley Lynn Tarditi Trust and ROJ, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $6 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. On June 29, 2020, a lawsuit styled, Yuan Yu and Polly Yu v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $1 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. On July 7, 2020, a cross-claim styled, Laurie Peterson v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in an existing lawsuit styled, Banc of California, National Association v. Laurie Peterson, which is pending in San Diego County Superior Court. Cross-complaint plaintiff was sued by a bank to recover in excess of $35 million that she allegedly guaranteed to repay for certain investments made by the Banc of California in the alcoholic beverage license scheme. Cross-complaint plaintiff has, in turn, sued the Named Companies in that action seeking in excess of $250 million in monetary losses as well as exemplary damages and attorneys’ fees. On September 3, 2020, a cross-claim styled, Kim H. Peterson Trustee of the Peterson Family Trust dated April 14 1992 v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in an existing lawsuit styled, CalPrivate Bank v. Kim H. Peterson Trustee of the Peterson Family Trust dated April 14 1992, which is pending in Superior Court of San Diego County for the State of California. Cross-complaint plaintiff was sued by a bank to recover in excess of $12 million that the trustee allegedly guaranteed to repay for certain investments made by CalPrivate Bank in the alcoholic beverage license scheme. Cross-complaint plaintiff has, in turn, sued the Named Companies in that action seeking in excess of $250 million in monetary losses as well as exemplary damages and attorneys’ fees. On October 1, 2020, a lawsuit styled, Ovation Fin. Holdings 2 LLC, Ovation Fund Mgmt. II, LLC, Banc of California, N.A. v. Chicago Title Ins. Co., was filed in San Diego County Superior Court. Plaintiffs claim losses of more than $75 million, as well as consequential and punitive damages. The Named Companies have filed a cross-complaint against Ms. Champion-Cain, among others. On November 2, 2020, a lawsuit styled, CalPrivate Bank v. Chicago Title Co. and Chicago Title Ins. Co., was also filed in the Superior Court of San Diego County for the State of California. Plaintiff claims losses in excess of $12 million based upon business loan advances made in the alcoholic beverage license scheme, and also seeks punitive damages and the recovery of attorneys’ fees. The Named Companies have filed a cross-complaint against Ms. Champion-Cain, among others. On February 24, 2021, a putative class action lawsuit styled, Blake E. Allred and Melissa M. Allred v. Chicago Title Co., Chicago Title Ins. Co., was filed in the Superior Court of San Diego County for the State of California. Plaintiffs are seeking compensatory, statutory, treble, and punitive damages. On October 23, 2020, a lawsuit styled, DH Claims LLC v. Chicago Title Co., Chicago Title Ins. Co., and Della Ducharme, was filed in the Superior Court of Orange County for the State of California. Plaintiff claims losses in excess of $2 million as a result of the alleged fraud scheme, and also seeks statutory, treble, and punitive damages, as well as the recovery of attorneys’ fees. This matter has conditionally settled under confidential terms. In addition, Chicago Title Company has conditionally resolved claims from both individual investors and a group of alleged investors under confidential terms during pre-suit mediations. As of March 31, 2021, the Company has recorded an incurred claim loss reserve for legal fees and any remaining unpaid amounts relating to losses on the matters resolved confidentially mentioned above which is included in its consolidated reserve for title claim losses. The Company has also recorded an insurance recoverable for amounts that it expects to recover from its insurance carriers relating to these matters. At this time, the Company is unable to ascertain its liability, if any, and is unable to make an estimate of a reasonably possible claim loss for any of the unresolved claims due to the complex nature of the claims and litigation, the early procedural status of each claim (involving unresolved questions of fact without any rulings on the merits or determinations of liability), the extent of discovery not yet conducted, potential insurance coverage, and an incomplete evaluation of possible defenses, counterclaims, crossclaims or third-party claims that may exist. Moreover, it is likely that in some instances, the claims listed above are duplicative. As further information becomes available, the Company will continue to evaluate the adequacy of its consolidated reserve for title claim losses. As of March 31, 2021, the Company believes that its reserves are adequate to cover its losses related to this matter and other claims. We continually upda te loss reserve estimates as new information becomes known, new loss patterns emerge or as other contributing factors are considered and incorporated into the analysis of reserve for claim losses. Estimating future title loss payments is difficult because of the complex nature of title claims, the long periods of time over which claims are paid, significantly varying dollar amounts of individual claims and other factors. Due to the uncertainty inherent in the process and to the judgment used by management, the ultimate liability may be greater or less than our current reserves. If actual claims loss development varies from what is currently expected and is not offset by other factors, it is possible that additional reserve adjustments may be required in future periods in order to maintain our recorded reserve within a reasonable range of our actuary's central estimate. Our U.S. insurance subsidiaries, FGL Insurance, Fidelity & Guaranty Life Insurance Company of New York ("FGL NY Insurance"), and Raven Re, file financial statements with state insurance regulatory authorities and the National Association of Insurance Commissioners (“NAIC”) that are prepared in accordance with Statutory Accounting Principles (“SAP”) prescribed or permitted by such authorities, which may vary materially from GAAP. Prescribed SAP includes the Accounting Practices and Procedures Manual of the NAIC as well as state laws, regulations and administrative rules. Permitted SAP encompasses all accounting practices not so prescribed. The principal differences between SAP financial statements and financial statements prepared in accordance with GAAP are that SAP financial statements do not reflect DAC, DSI and VOBA, some bond portfolios may be carried at amortized cost, assets and liabilities are presented net of reinsurance, contractholder liabilities are generally valued using more conservative assumptions and certain assets are non-admitted. Accordingly, SAP operating results and SAP capital and surplus may differ substantially from amounts reported in the GAAP basis financial statements for comparable items. FSRC (Cayman) and F&G Life Re (Bermuda) file financial statements with their respective regulators that are based on U.S. GAAP. FGL Insurance applies Iowa-prescribed accounting practices that permit Iowa-domiciled insurers to report equity call options used to economically hedge FIA index credits at amortized cost for statutory accounting purposes and to calculate FIA statutory reserves such that index credit returns will be included in the reserve only after crediting to the annuity contract. This resulted in a $133 million and $144 million decrease to statutory capital and surplus at March 31, 2021 and December 31, 2020, respectively. FGL Insurance’s statutory carrying value of Raven Re reflects the effect of permitted practices Raven Re received to treat the available amount of a letter of credit as an admitted asset which increased Raven Re’s statutory capital and surplus by $85 million at March 31, 2021 and December 31, 2020. Raven Re is also permitted to follow Iowa prescribed statutory accounting practice for its reserves on reinsurance assumed from FGL Insurance which increased Raven Re’s statutory capital and surplus by $5 million at March 31, 2021 and December 31, 2020. Without such permitted statutory accounting practices Raven Re’s statutory capital and surplus (deficit) would be less than $1 million as of March 31, 2021 and would be $(6) million as of December 31, 2020, and its risk-based capital would fall below the minimum regulatory requirements. The letter of credit facility is collateralized by NAIC 1 rated debt securities. If the permitted practice was revoked, the letter of credit could be replaced by the collateral assets with Nomura’s consent. FGL Insurance’s statutory carrying value of Raven Re was $90 million and $84 million at March 31, 2021 and December 31, 2020, respectively. As of March 31, 2021, FGL NY Insurance did not follow any prescribed or permitted statutory accounting practices that differ from the NAIC's statutory accounting practices. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Our measurement of fair value is based on assumptions used by market participants in pricing the asset or liability, which may include inherent risk, restrictions on the sale or use of an asset, or non-performance risk, which may include our own credit risk. We estimate an exchange price is the price in an orderly transaction between market participants to sell the asset or transfer the liability (“exit price”) in the principal market, or the most advantageous market for that asset or liability in the absence of a principal market as opposed to the price that would be paid to acquire the asset or assume a liability (“entry price”). We categorize financial instruments carried at fair value into a three-level fair value hierarchy, based on the priority of inputs to the respective valuation technique. The three-level hierarchy for fair value measurement is defined as follows: Level 1 - Values are unadjusted quoted prices for identical assets and liabilities in active markets accessible at the measurement date. Level 2 - Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices from those willing to trade in markets that are not active, or other inputs that are observable or can be corroborated by market data for the term of the instrument. Such inputs include market interest rates and volatilities, spreads, and yield curves. Level 3 - Certain inputs are unobservable (supported by little or no market activity) and significant to the fair value measurement. Unobservable inputs reflect the Company’s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date based on the best information available in the circumstances. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment. When a determination is made to classify an asset or liability within Level 3 of the fair value hierarchy, the determination is based upon the significance of the unobservable inputs to the overall fair value measurement. Because certain securities trade in less liquid or illiquid markets with limited or no pricing information, the determination of fair value for these securities is inherently more difficult. In addition to the unobservable inputs, Level 3 fair value investments may include observable components, which are components that are actively quoted or can be validated to market-based sources. The carrying amounts and estimated fair values of our financial instruments for which the disclosure of fair values is required, including financial assets and liabilities measured and carried at fair value on a recurring basis, with the exception of investment contracts, portions of other long-term investments and debt which are disclosed later within this footnote, was summarized according to the hierarchy previously described, as follows (in millions): March 31, 2021 Level 1 Level 2 Level 3 Fair Value Carrying Amount Assets Cash and cash equivalents $ 3,026 $ — $ — $ 3,026 $ 3,026 Fixed maturity securities, available-for-sale: Asset-backed securities — 5,069 1,593 6,662 6,662 Commercial mortgage-backed securities — 2,865 25 2,890 2,890 Corporates 36 13,182 1,246 14,464 14,464 Hybrids 161 791 — 952 952 Municipals — 1,376 41 1,417 1,417 Residential mortgage-backed securities — 320 487 807 807 U.S. Government 339 — — 339 339 Foreign Governments — 170 17 187 187 Equity securities 838 590 8 1,436 1,436 Preferred securities 480 812 1 1,293 1,293 Derivative investments 1 541 — 542 542 Short term investments 105 19 — 124 124 Other long-term investments — — 48 48 48 Total financial assets at fair value $ 4,986 $ 25,735 $ 3,466 $ 34,187 $ 34,187 Liabilities Fair value of future policy benefits — — — — — Derivatives: FIA embedded derivatives, included in contractholder funds — — 3,293 3,293 3,293 Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities — 75 — 75 75 Subscription agreements — 4 — 4 4 Preferred shares reimbursement feature embedded derivative — — 4 4 4 Total financial liabilities at fair value $ — $ 79 $ 3,297 $ 3,376 $ 3,376 December 31, 2020 Level 1 Level 2 Level 3 Fair Value Carrying Amount Assets Cash and cash equivalents $ 2,719 $ — $ — $ 2,719 $ 2,719 Fixed maturity securities, available-for-sale: Asset-backed securities — 4,916 1,350 6,266 6,266 Commercial mortgage-backed securities — 2,803 26 2,829 2,829 Corporates 25 13,421 1,289 14,735 14,735 Hybrids 175 815 4 994 994 Municipals — 1,360 43 1,403 1,403 Residential mortgage-backed securities — 342 483 825 825 U.S. Government 342 — — 342 342 Foreign Governments — 176 17 193 193 Equity securities 791 — 5 796 796 Preferred securities 490 851 — 1,341 1,341 Subscription agreements (1) — 199 — 199 199 Derivative investments — 548 — 548 548 Short term investments 769 — — 769 769 Other long-term investments — — 50 50 50 Total financial assets at fair value $ 5,311 $ 25,431 $ 3,267 $ 34,009 $ 34,009 Liabilities Fair value of future policy benefits — — 5 5 5 Derivatives: FIA embedded derivatives, included in contractholder funds — — 3,404 3,404 3,404 Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities — 101 — 101 101 Total financial liabilities at fair value $ — $ 101 $ 3,409 $ 3,510 $ 3,510 (1) Included within equity securities in the accompanying Condensed Consolidated Balance Sheets as of December 31, 2020. Valuation Methodologies Fixed Maturity Securities & Equity Securities We measure the fair value of our securities based on assumptions used by market participants in pricing the security. The most appropriate valuation methodology is selected based on the specific characteristics of the fixed maturity or equity security, and we will then consistently apply the valuation methodology to measure the security’s fair value. Our fair value measurement is based on a market approach, which utilizes prices and other relevant information generated by market transactions involving identical or comparable securities. Sources of inputs to the market approach include third-party pricing services, independent broker quotations, or pricing matrices. We use observable and unobservable inputs in our valuation methodologies. Observable inputs include benchmark yields, reported trades, broker-dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data including market research publications. In addition, market indicators and industry and economic events are monitored and further market data will be acquired when certain thresholds are met. For certain security types, additional inputs may be used, or some of the inputs described above may not be applicable. The significant input used in the fair value measurement of equity securities for which the market approach valuation technique is employed is yield for comparable securities. Increases or decreases in the yields would result in lower or higher, respectively, fair value measurements. For broker-quoted only securities, quotes from market makers or broker-dealers are obtained from sources recognized to be market participants. We believe the broker quotes are prices at which trades could be executed based on historical trades executed at broker-quoted or slightly higher prices. We analyze the third-party valuation methodologies and related inputs to perform assessments to determine the appropriate level within the fair value hierarchy. However, we did not adjust prices received from third parties as of March 31, 2021 or December 31, 2020. Derivative Financial Instruments The fair value of call option is based upon valuation pricing models, which represents what we would expect to receive or pay at the balance sheet date if we canceled the options, entered into offsetting positions, or exercised the options. Fair values for these instruments are determined internally, based on industry accepted valuation pricing models which use market-observable inputs, including interest rates, yield curve volatilities, and other factors. The fair value of futures contracts represents the cumulative unsettled variation margin (open trade equity, net of cash settlements) which represents what we would expect to receive or pay at the balance sheet date if we canceled the contracts or entered into offsetting positions. These contracts are classified as Level 1. The fair value measurement of the FIA embedded derivatives included in contractholder funds is determined through a combination of market observable information and significant unobservable inputs using the option budget method. The market observable inputs are the market value of option and treasury rates. The significant unobservable inputs are the budgeted option cost (i.e., the expected cost to purchase call options in future periods to fund the equity indexed linked feature), surrender rates, mortality multiplier and non-performance spread. The mortality multiplier at March 31, 2021 was applied to the Annuity 2000 mortality tables. Increases or decreases in the market value of an option in isolation would result in a higher or lower, respectively, fair value measurement. Increases or decreases in treasury rates, mortality multiplier, surrender rates, or non-performance spread in isolation would result in a lower or higher fair value measurement, respectively. Generally, a change in any one unobservable input would not directly result in a change in any other unobservable input. The fair value of the reinsurance-related embedded derivative in the funds withheld reinsurance agreement with Kubera Insurance (SAC) Ltd. ("Kubera"), a third party insurer, is estimated based upon the fair value of the assets supporting the funds withheld from reinsurance liabilities. The fair value of the assets is based on a quoted market price of similar assets (Level 2), and therefore the fair value of the embedded derivative is based on market-observable inputs and classified as Level 2. See Note P Reinsurance in our Annual Report on Form 10-K for the year ended December 31, 2020 for further discussion on F&G reinsurance agreements. Other long-term investments Fair value of the available-for-sale embedded derivative is based on an unobservable input, the net asset value of the fund at the balance sheet date. The embedded derivative is similar to a call option on the net asset value of the fund with a strike price of zero since Fidelity & Guaranty Life Insurance Company ("FGL Insurance") will not be required to make any additional payments at maturity of the fund-linked note in order to receive the net asset value of the fund on the maturity date. A Black-Scholes model determines the net asset value of the fund as the fair value of the call option regardless of the values used for the other inputs to the option pricing model. The net asset value of the fund is provided by the fund manager at the end of each calendar month and represents the value an investor would receive if it withdrew its investment on the balance sheet date. Therefore, the key unobservable input used in the Black-Scholes model is the value of the fund. As the value of the fund increases or decreases, the fair value of the embedded derivative will increase or decrease. See further discussion on the available-for-sale embedded derivative in Note E Derivative Financial Instruments . The fair value of the credit-linked note is based on a weighted average of a broker quote and a discounted cash flow analysis. The discounted cash flow approach is based on the expected portfolio cash flows and amortization schedule reflecting investment expectations, adjusted for assumptions on the portfolio's default and recovery rates, and the note's discount rate. The fair value of the note is provided by the fund manager at the end of each quarter. Subscription Agreements for Forward Purchases of Equity of Special Purpose Acquisition Companies Our subscription agreements are accounted for at fair value pursuant to ASC Topic 321, Investments - Equity Securities and considered to be a Level 2 fair value measurement. Fair value is determined using observable inputs including stock prices, volatility assumptions and a discount for the lack of marketability determined using a combination of the Finnerty Model, Asian Put and Synthetic Forward considerations. The selected discount for the lack of marketability was determined as 3.0%. Quantitative information regarding significant unobservable inputs used for recurring Level 3 fair value measurements of financial instruments carried at fair value as of March 31, 2021 and December 31, 2020 are as follows: Fair Value at Valuation Technique Unobservable Input(s) Range (Weighted average) March 31, 2021 (in millions) March 31, 2021 Assets Asset-backed securities $ 1,430 Broker-quoted Offered quotes 48.67% - 115.83% 92.15% Asset-backed securities 163 Third-Party Valuation Offered quotes 0.00% - 104.73% 78.18% Commercial mortgage-backed securities 25 Broker-quoted Offered quotes 128.77% - 128.77% 128.77% Corporates 385 Broker-quoted Offered quotes 91.56% - 110.78% 102.28% Corporates 17 Discounted Cash Flow Discount Rate 44.00% - 100.00% 79.02% Corporates 844 Third-Party Valuation Offered quotes 85.23% - 122.88% 105.67% Municipals 41 Third-Party Valuation Offered quotes 126.62% - 126.62% 126.62% Residential mortgage-backed securities 487 Broker-quoted Offered quotes 0.00% - 115.50% 115.50% Foreign governments 17 Third-Party Valuation Offered quotes 107.19% - 109.61% 107.95% Preferred securities 1 Income-Approach Yield —% Equity securities 2 Black Scholes model Risk Free Rate 0.50% - 0.50% (0.50%) Strike Price $1.50 - $1.50 ($1.50) Volatility 109.66% - 109.66% (109.66%) Dividend Yield 0.00% - 0.00% (0.00%) Equity securities 2 Broker Quoted Offered quotes Equity securities 4 Discounted Cash Flow Discount rate 10.60% - 10.60% (10.60%) Market Comparable Company Analysis EBITDA multiple 6.6 x - 6.6 x (6.6 x ) Other long-term assets: Available-for-sale embedded derivative 29 Third-Party Valuation Market value of fund 100.00% Credit Linked Note 19 Broker-quoted Offered quotes 100.00% Total financial assets at fair value $ 3,466 Liabilities Future policy benefits $ 4 Discounted cash flow Non-performance spread 0.50% Derivatives: FIA embedded derivatives, included in contractholder funds 3,293 Discounted cash flow Market value of option 0.00% - 70.30% 3.76% Swap rates 0.01% - 2.41% 1.21% Mortality multiplier 100.00% - 100.00% 100.00% Surrender rates 0.25% - 55.00% 5.32% Partial withdrawals 2.00% - 3.50% 2.60% Non-performance spread 0.75% - 0.75% 0.75% Option cost 0.05% - 15.94% 2.26% Total financial liabilities at fair value $ 3,297 Fair Value at Valuation Technique Unobservable Input(s) Range (Weighted average) December 31, 2020 (in millions) December 31, 2020 Assets Asset-backed securities $ 1,175 Broker-quoted Offered quotes 85% - 126.15% 103.96% Asset-backed securities 175 Third-Party Valuation Offered quotes 0.00% - 107.25% 79.87% Commercial mortgage-backed securities 26 Broker-quoted Offered quotes 131.59% - 131.59% 131.59% Corporates 388 Broker-quoted Offered quotes 75.20% - 114.68% 103.36% Corporates 901 Third-Party Valuation Offered quotes 88.42% - 125.83% 109.47% Hybrids 4 Third-Party Valuation Offered quotes 112.06% - 112.06% 112.06% Municipals 43 Third-Party Valuation Offered quotes 133.53% - 133.53% 133.53% Residential mortgage-backed securities 483 Broker-quoted Offered quotes 112.58% - 112.58% 112.58% Foreign governments 17 Third-Party Valuation Offered quotes 107.87% - 113.80% 109.72% Equity securities 1 Income-Approach Yield —% Equity securities 1 Black Scholes model Risk Free Rate 0.29% - 0.29% (0.29%) Strike Price $1.50 - $1.50 ($1.50) Volatility 1.00% - 1.00% (1.00%) Dividend Yield 0.00% - 0.00% (0.00%) Equity securities 3 Discounted Cash Flow Discount rate 10.60% - 10.60% (10.60%) Market Comparable Company Analysis EBITDA multiple 6.6x - 6.6x (6.6x) Other long-term assets: Available-for-sale embedded derivative 27 Third-Party Valuation Market value of fund 100.00% Credit Linked Note 23 Broker-quoted Offered quotes 100.00% Total financial assets at fair value $ 3,267 Liabilities Future policy benefits 5 Discounted cash flow Non-performance spread 0.00% Risk margin to reflect uncertainty 0.50% Derivatives: FIA embedded derivatives, included in contractholder funds 3,404 Discounted cash flow Market value of option 0.00% - 67.65% 2.25% Treasury rates 0.08% - 1.65% 0.87% Mortality multiplier 100.00% - 100.00% 100.00% Surrender rates 0.25% - 55.00% 5.24% Partial withdrawals 2.00% - 3.50% 2.58% Non-performance spread 0.74% - 0.74% 0.74% Option cost 0.05% - 16.61% 2.25% Total financial liabilities at fair value $ 3,409 The following tables summarize changes to the Company’s financial instruments carried at fair value and classified within Level 3 of the fair value hierarchy for the three months ended March 31, 2021 and 2020. This summary excludes any impact of amortization of VOBA, DAC and DSI. The gains and losses below may include changes in fair value due in part to observable inputs that are a component of the valuation methodology. Three months ended March 31, 2021 (in millions) Balance at Beginning Total Gains (Losses) Purchases Sales Settlements Net transfer In (Out) of Balance at End of Change in Unrealized Incl in OCI Included in Included in Assets Fixed maturity securities available-for-sale: Asset-backed securities $ 1,350 $ — $ (23) $ 358 $ — $ (92) $ — $ 1,593 $ (4) Commercial mortgage-backed securities 26 — (1) — — — — 25 1 Corporates 1,289 6 (39) 40 (5) (31) (14) 1,246 19 Hybrids 4 — — — — (4) — — — Municipals 43 — (2) — — — — 41 4 Residential mortgage-backed securities 483 — 12 5 — (13) — 487 27 Foreign Governments 17 — — — — — — 17 2 Equity and preferred securities 5 1 — 3 — — — 9 — Other long-term assets: Available-for-sale embedded derivative 27 2 — — — — — 29 — Credit linked note 23 — (4) — — — — 19 — Total assets at Level 3 fair value $ 3,267 $ 9 $ (57) $ 406 $ (5) $ (140) $ (14) $ 3,466 $ 49 Liabilities Future policy benefits $ 5 $ — $ — $ — $ — $ (1) $ — $ 4 $ — FIA embedded derivatives, included in contractholder funds 3,404 (111) — — — — — 3,293 — Total liabilities at Level 3 fair value $ 3,409 $ (111) $ — $ — $ — $ (1) $ — $ 3,297 $ — (a) The net transfers out of Level 3 during the three months ended March 31, 2021 were exclusively to Level 2. Three months ended March 31, 2020 (in millions) Balance at Beginning Total Gains (Losses) Purchases Sales Settlements Net transfer In (Out) of Balance at End of Change in Unrealized Incl in OCI Included in Included in Assets Fixed maturity securities available-for-sale: Corporates $ 17 $ (3) $ — $ — $ — $ — $ — $ 14 $ — Equity securities 1 — — — — — — 1 — Other invested assets: Other long-term investment 120 (61) — — — — (59) — — Total assets at Level 3 fair value $ 138 $ (64) $ — $ — $ — $ — $ (59) $ 15 $ — Valuation Methodologies and Associated Inputs for Financial Instruments Not Carried at Fair Value The following discussion outlines the methodologies and assumptions used to determine the fair value of our financial instruments not carried at fair value. Considerable judgment is required to develop these assumptions used to measure fair value. Accordingly, the estimates shown are not necessarily indicative of the amounts that would be realized in a one-time, current market exchange of all of our financial instruments. Mortgage Loans The fair value of mortgage loans is established using a discounted cash flow method based on internal credit rating, maturity and future income. This yield-based approach is sourced from our third-party vendor. The internal ratings for mortgages in good standing are based on property type, location, market conditions, occupancy, debt service coverage, loan-to-value, quality of tenancy, borrower, and payment record. The inputs used to measure the fair value of our mortgage loans are classified as Level 3 within the fair value hierarchy. Policy Loans (included within Other long-term investments) Fair values for policy loans are estimated from a discounted cash flow analysis, using interest rates currently being offered for loans with similar credit risk. Loans with similar characteristics are aggregated for purposes of the calculations. Company Owned Life Insurance Company owned life insurance (COLI) is a life insurance program used to finance certain employee benefit expenses. The fair value of COLI is based on net realizable value, which is generally cash surrender value. COLI is classified as Level 3 within the fair value hierarchy. Other Invested Assets (included within Other long-term investments) The fair value of the bank loan is estimated using a discounted cash flow method with the discount rate based on weighted average cost of capital ("WACC"). This yield-based approach is sourced from a third-party vendor and the WACC establishes a market participant discount rate by determining the hypothetical capital structure for the asset should it be underwritten as of each period end. Other invested assets are classified as Level 3 within the fair value hierarchy. Investment Contracts Investment contracts include deferred annuities, FIAs, indexed universal life policies ("IULs") and immediate annuities. The fair value of deferred annuity, FIA, and IUL contracts is based on their cash surrender value (i.e. the cost the Company would incur to extinguish the liability) as these contracts are generally issued without an annuitization date. The fair value of immediate annuities contracts is derived by calculating a new fair value interest rate using the updated yield curve and treasury spreads as of the respective reporting date. The Company is not required to, and has not, estimated the fair value of the liabilities under contracts that involve significant mortality or morbidity risks, as these liabilities fall within the definition of insurance contracts that are exceptions from financial instruments that require disclosures of fair value. Other FHLB common stock, Accounts receivable and Notes receivable are carried at cost, which approximates fair value. FHLB common stock is classified as Level 2 within the fair value hierarchy. Accounts receivable and Notes receivable are classified as Level 3 within the fair value hierarchy. Debt The fair value of debt is based on quoted market prices of other debt with similar characteristics. The inputs used to measure the fair value of our outstanding debt are classified as Level 2 within the fair value hierarchy. The following tables provide the carrying value and estimated fair value of our financial instruments that are carried on the unaudited Condensed Consolidated Balance Sheets at amounts other than fair value, summarized according to the fair value hierarchy previously described. March 31, 2021 (in millions) Level 1 Level 2 Level 3 Total Estimated Fair Value Carrying Amount Assets FHLB common stock $ — $ 64 $ — $ 64 $ 64 Commercial mortgage loans — — 1,197 1,197 1,206 Residential mortgage loans — — 1,154 1,154 1,168 Policy loans — — 34 34 34 Other invested assets — — 26 26 26 Company-owned life insurance — — 309 309 309 Trade and notes receivables, net of allowance — — 425 425 425 Total $ — $ 64 $ 3,145 $ 3,209 $ 3,232 Liabilities Investment contracts, included in contractholder funds $ — $ — $ 22,880 $ 22,880 $ 26,244 Debt — 2,796 — 2,796 2,663 Total $ — $ 2,796 $ 22,880 $ 25,676 $ 28,907 December 31, 2020 (in millions) Level 1 Level 2 Level 3 Total Estimated Fair Value Carrying Amount Assets FHLB common stock $ — $ 66 $ — $ 66 $ 66 Commercial mortgage loans — — 926 926 903 Residential mortgage loans — — 1,123 1,123 1,128 Policy loans — — 33 33 33 Other invested assets — — 28 28 28 Company-owned life insurance — — 305 305 305 Trade and notes receivables, net of allowance — — 437 437 437 Total $ — $ 66 $ 2,852 $ 2,918 $ 2,900 Liabilities Investment contracts, included in contractholder funds $ — $ — $ 21,719 $ 21,719 $ 25,199 Debt — 2,896 — 2,896 2,662 Total $ — $ 2,896 $ 21,719 $ 24,615 $ 27,861 The following table includes assets that have not been classified in the fair value hierarchy as the value of these investments are measured using the equity method of accounting or the net asset value ("NAV") per share practical expedient (in millions): Carrying Value After Measurement March 31, 2021 December 31, 2020 Investments in unconsolidated affiliates (equity method of accounting) $ 143 $ 146 Investments in unconsolidated affiliates (NAV) $ 1,281 1,148 For investments for which NAV is used as a practical expedient for fair value, we do not have any significant restrictions in our ability to liquidate their positions in these investments, other than obtaining general partner approval, nor do we believe it is probable a price less than NAV would be received in the event of a liquidation. Equity method investments are reported on a lag of up to three months for investee information not received timely. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Our fixed maturity securities investments have been designated as available-for-sale and are carried at fair value, net of allowance for expected credit losses, with unrealized gains and losses included in AOCI, net of associated adjustments for DAC, VOBA, DSI, UREV, SOP 03-1 reserves, and deferred income taxes. Our equity securities investments are carried at fair value with unrealized gains and losses included in net income (loss). The Company’s consolidated investments at March 31, 2021 and December 31, 2020 are summarized as follows (in millions): March 31, 2021 Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Carrying Value Available-for-sale securities Asset-backed securities $ 6,358 $ — $ 339 $ (35) $ 6,662 $ 6,662 Commercial mortgage-backed securities 2,514 (1) 382 (5) 2,890 2,890 Corporates 14,178 (3) 633 (344) 14,464 14,464 Hybrids 892 — 60 — 952 952 Municipals 1,399 — 43 (25) 1,417 1,417 Residential mortgage-backed securities 774 (3) 37 (1) 807 807 U.S. Government 333 — 6 — 339 339 Foreign Governments 186 — 4 (3) 187 187 Total available-for-sale securities $ 26,634 $ (7) $ 1,504 $ (413) $ 27,718 $ 27,718 December 31, 2020 Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Carrying Value Available-for-sale securities Asset-backed securities $ 5,941 $ — $ 343 $ (18) $ 6,266 $ 6,266 Commercial mortgage-backed/asset-backed securities $ 2,490 $ — $ 342 $ (3) $ 2,829 $ 2,829 Corporates 13,582 (16) 1,184 (15) 14,735 14,735 Hybrids 914 — 80 — 994 994 Municipals 1,333 — 72 (2) 1,403 1,403 Residential mortgage-backed securities 806 (3) 23 (1) 825 825 U.S. Government 332 — 10 — 342 342 Foreign Governments 179 — 14 — 193 193 Total available-for-sale securities $ 25,577 $ (19) $ 2,068 $ (39) $ 27,587 $ 27,587 Securities held on deposit with various state regulatory authorities had a fair value of $17,127 million and $16,714 million at March 31, 2021 and December 31, 2020, respectively. At March 31, 2021 and December 31, 2020, the Company held no material investments that were non-income producing for a period greater than twelve months. At March 31, 2021 and December 31, 2020, the Company's accrued interest receivable balance was $246 million and $235 million, respectively. Accrued interest receivable is classified within Prepaid expenses and other assets within the unaudited Condensed Consolidated Balance Sheets. In accordance with our FHLB agreements, the investments supporting the funding agreement liabilities are pledged as collateral to secure the FHLB funding agreement liabilities and are not available to the Company for general purposes. The collateral investments had a fair value of $1,803 million and $1,622 million as of March 31, 2021 and December 31, 2020, respectively. The amortized cost and fair value of fixed maturity available-for-sale securities by contractual maturities, as applicable, are shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. March 31, 2021 (in millions) Amortized Cost Fair Value Corporates, Non-structured Hybrids, Municipal and Government securities: Due in one year or less $ 531 $ 536 Due after one year through five years 1,919 2,029 Due after five years through ten years 2,260 2,346 Due after ten years 12,252 12,418 Subtotal 16,962 17,329 Other securities which provide for periodic payments: Asset-backed securities 6,358 6,662 Commercial mortgage-backed securities 2,514 2,890 Structured hybrids 26 30 Residential mortgage-backed securities 774 807 Subtotal 9,672 10,389 Total fixed maturity available-for-sale securities $ 26,634 $ 27,718 Allowance for Expected Credit Loss We regularly review AFS securities for declines in fair value that we determine to be credit related. For our fixed maturity securities, we generally consider the following in determining whether our unrealized losses are credit related, and if so, the magnitude of the credit loss: • The extent to which the fair value is less than the amortized cost basis; • The reasons for the decline in value (credit event, currency or interest-rate related, including general credit spread widening); • The financial condition of and near-term prospects of the issuer (including issuer's current credit rating and the probability of full recovery of principal based upon the issuer's financial strength); • Delinquencies and nonperforming assets of underlying collateral; • Expected future default rates; • Collateral value by vintage, geographic region, industry concentration or property type; • Subordination levels or other credit enhancements as of the balance sheet date as compared to origination; and • Contractual and regulatory cash obligations and the issuer's plans to meet such obligations. We recognize an allowance for expected credit losses on fixed maturity securities in an unrealized loss position when it is determined, using the factors discussed above, a component of the unrealized loss is related to credit. We measure the credit loss using a discounted cash flow model that utilizes the single best estimate cash flow and the recognized credit loss is limited to the total unrealized loss on the security (i.e. the fair value floor). Cash flows are discounted using the implicit yield of bonds at their time of purchase and the current book yield for asset and mortgage backed securities as well as variable rate securities. We recognize the expected credit losses in Recognized gains and losses, net in the Consolidated Statements of Earnings, with an offset for the amount of non-credit impairments recognized in AOCI. We do not measure a credit loss allowance on accrued investment income because we write-off accrued interest through to Interest and investment income when collectability concerns arise. We consider the following in determining whether write-offs of a security’s amortized cost is necessary: • We believe amounts related to securities have become uncollectible; or • We intend to sell a security; or • It is more likely than not that we will be required to sell a security prior to recovery. If we intend to sell a fixed maturity security or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis and the fair value of the security is below amortized cost, we will write down the security to current fair value, with a corresponding charge, net of any amount previously recognized as an allowance for expected credit loss, to Recognized gains and losses, net in the accompanying Consolidated Statements of Earnings. If we do not intend to sell a fixed maturity security or it is more likely than not that we will not be required to sell a fixed maturity security before recovery of its amortized cost basis but believe amounts related to a security are uncollectible (generally based on proximity to expected credit loss), an impairment is deemed to have occurred and the amortized cost is written down to the estimated recovery value with a corresponding charge, net of any amount previously recognized as an allowance for expected credit loss, to Recognized gains and losses, net in the accompanying Consolidated Statements of Earnings. The remainder of unrealized loss is held in AOCI. The activity in the allowance for expected credit losses of available-for-sale securities aggregated by investment category were as follows for the three months ended March 31, 2021 (in millions): Three Months Ended March 31, 2021 Additions Reductions Balance at Beginning of Period For credit losses on securities for which losses were not previously recorded For initial credit losses on purchased securities accounted for as PCD financial assets (1) (Additions) reductions in allowance recorded on previously impaired securities For securities sold during the period For securities intended/required to be sold prior to recovery of amortized cost basis Write-offs charged against the allowance Recoveries of amounts previously written off Balance at End of Period Available-for-sale securities Commercial mortgage-backed securities $ — $ (1) $ — $ — $ — $ — $ — — $ (1) Corporates (16) — — 7 — — 3 3 (3) Residential mortgage-backed securities (3) — — — — — — — (3) Total available-for-sale securities $ (19) $ (1) $ — $ 7 $ — $ — $ 3 $ 3 $ (7) (1) Purchased credit deteriorated financial assets ("PCD") Purchased credit-deteriorated available-for-sale debt securities ("PCD"s) are AFS securities purchased at a discount, where part of that discount is attributable to credit. Credit loss allowances are calculated for these securities as of the date of their acquisition, with the initial allowance serving to increase amortized cost. There were no purchases of PCD AFS securities during the three months ended March 31, 2021. The fair value and gross unrealized losses of available-for-sale securities, excluding securities in an unrealized loss position with an allowance for expected credit loss, aggregated by investment category and duration of fair value below amortized cost as of March 31, 2021, and December 31, 2020 were as follows (dollars in millions): March 31, 2021 Less than 12 months 12 months or longer Total Fair Value Gross Unrealized Fair Value Gross Unrealized Fair Value Gross Unrealized Available-for-sale securities Asset-backed securities $ 1,095 $ (35) $ — $ — $ 1,095 $ (35) Commercial mortgage-backed securities 250 (3) — — 250 (3) Corporates 5,634 (344) 1 — 5,635 (344) Hybrids 31 — — — 31 — Municipals 686 (25) — — 686 (25) Residential mortgage-backed securities 37 (1) — — 37 (1) U.S. Government 42 — — — 42 — Foreign Government 98 (3) 5 — 103 (3) Total available-for-sale securities $ 7,873 $ (411) $ 6 $ — $ 7,879 $ (411) Total number of available-for-sale securities in an unrealized loss position less than twelve months 726 Total number of available-for-sale securities in an unrealized loss position twelve months or longer 2 Total number of available-for-sale securities in an unrealized loss position 728 December 31, 2020 Less than 12 months 12 months or longer Total Fair Value Gross Unrealized Fair Value Gross Unrealized Fair Value Gross Unrealized Available-for-sale securities Asset-backed securities $ 477 $ (18) $ — $ — $ 477 $ (18) Commercial mortgage-backed securities 51 (3) — — 51 (3) Corporates $ 865 $ (15) $ 36 $ — $ 901 $ (15) Hybrids 1 — — — 1 — Municipals 115 (2) — — 115 (2) Residential mortgage-backed securities 30 (1) — — 30 (1) U.S. Government 11 — — — 11 — Foreign Government — — — — — — Total available-for-sale securities $ 1,550 $ (39) $ 36 $ — $ 1,586 $ (39) Total number of available-for-sale securities in an unrealized loss position less than twelve months 222 Total number of available-for-sale securities in an unrealized loss position twelve months or longer 11 Total number of available-for-sale securities in an unrealized loss position 233 We determined the increase in unrealized losses as of March 31, 2021 was caused by higher treasury rates, offset by narrower spreads in certain sectors. This in part is expected as the economy continues its |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments The carrying amounts of derivative instruments, including derivative instruments embedded in FIA contracts, as of March 31, 2021 is as follows (in millions): March 31, 2021 December 31, 2020 Assets: Derivative investments: Call options $ 542 $ 548 Futures contracts 1 — Other long-term investments: Other embedded derivatives 27 27 Funds withheld: Embedded derivatives 1 — $ 571 $ 575 Liabilities: Contractholder funds: FIA embedded derivative $ 3,293 $ 3,404 Other liabilities: Reinsurance related embedded derivative 75 101 $ 3,368 $ 3,505 The change in fair value of derivative instruments included in the accompanying unaudited Condensed Consolidated Statements of Earnings is as follows (in millions): Three Months Ended March 31, 2021 Net investment gains (losses): Call options $ 22 Foreign currency forward 4 Reinsurance related embedded derivatives 27 Total net investment gains (losses) $ 53 Benefits and other changes in policy reserves: FIA embedded derivatives $ (111) Additional Disclosures FIA Embedded Derivative and Call Options and Futures We have FIA Contracts that permit the holder to elect an interest rate return or an equity index linked component, where interest credited to the contracts is linked to the performance of various equity indices, primarily the S&P 500 Index. This feature represents an embedded derivative under GAAP. The FIA embedded derivative is valued at fair value and included in the liability for contractholder funds in the accompanying unaudited Condensed Consolidated Balance Sheets with changes in fair value included as a component of Benefits and other changes in policy reserves in the unaudited Condensed Consolidated Statements of Earnings. See a description of the fair value methodology used in Note C Fair Value of Financial Instruments . We purchase derivatives consisting of a combination of call options and futures contracts on the applicable market indices to fund the index credits due to FIA contractholders. The call options are one two three five respective anniversary dates of the index policies, the index used to compute the interest credit is reset and we purchase new one two three five Other market exposures are hedged periodically depending on market conditions and our risk tolerance. Our FIA hedging strategy economically hedges the equity returns and exposes us to the risk that unhedged market exposures result in divergence between changes in the fair value of the liabilities and the hedging assets. We use a variety of techniques, including direct estimation of market sensitivities, to monitor this risk daily. We intend to continue to adjust the hedging strategy as market conditions and our risk tolerance changes. Credit Risk We are exposed to credit loss in the event of non-performance by our counterparties on the call options and reflect assumptions regarding this non-performance risk in the fair value of the call options. The non-performance risk is the net counterparty exposure based on the fair value of the open contracts less collateral held. We maintain a policy of requiring all derivative contracts to be governed by an International Swaps and Derivatives Association (“ISDA”) Master Agreement. Information regarding our exposure to credit loss on the call options we hold as of March 31, 2021, is presented in the following table (in millions): March 31, 2021 Counterparty Credit Rating Notional Fair Value Collateral Net Credit Risk Merrill Lynch AA-/*/A+ $ 1,716 $ 91 $ 51 $ 40 Morgan Stanley */Aa3/A+ 1,612 65 70 — Barclay's Bank A+/A1/A 5,294 105 109 — Canadian Imperial Bank of Commerce AA/Aa2/A+ 2,166 79 79 — Wells Fargo A+/A2/BBB+ 2,537 101 100 1 Goldman Sachs A/A2/BBB+ 268 12 13 — Credit Suisse A/Aa3/A+ 2,013 57 59 — Truist A+/A2/A 1,024 32 32 — Total $ 16,630 $ 542 $ 513 $ 41 (1) An * represents credit ratings that were not available. Collateral Agreements The Company is required to maintain minimum ratings as a matter of routine practice as part of its over-the-counter derivative agreements on ISDA forms. Under some ISDA agreements, the Company has agreed to maintain certain financial strength ratings. A downgrade below these levels provides the counterparty under the agreement the right to terminate the open option contracts between the parties, at which time any amounts payable by the Company or the counterparty would be dependent on the market value of the underlying option contracts. The Company's current rating doesn't allow any counterparty the right to terminate ISDA agreements. In certain transactions, the Company and the counterparty have entered into a collateral support agreement requiring either party to post collateral when the net exposures exceed pre-determined thresholds. For all counterparties, except Merrill Lynch, Credit Suisse, and Truist, this threshold is set to zero. As of March 31, 2021, counterparties posted $513 million of collateral of which $371 million is included in cash and cash equivalents with an associated payable for this collateral included in accounts payable and accrued liabilities on the unaudited Condensed Consolidated Balance Sheet. Accordingly, the maximum amount of loss due to credit risk that the Company would incur if parties to the call options failed completely to perform according to the terms of the contracts was $41 million at March 31, 2021. The Company is required to pay counterparties the effective federal funds rate each day for cash collateral posted to F&G for daily mark to market margin changes. The Company reinvests derivative cash collateral to reduce the interest cost. Cash collateral is invested in overnight investment sweep products which are included in cash and cash equivalents in the accompanying unaudited Condensed Consolidated Balance Sheets. The Company held 404 futures contracts at March 31, 2021. The fair value of the futures contracts represents the cumulative unsettled variation margin (open trade equity, net of cash settlements). The Company provides cash collateral to the counterparties for the initial and variation margin on the futures contracts which is included in cash and cash equivalents in the accompanying unaudited Condensed Consolidated Balance Sheets. The amount of cash collateral held by the counterparties for such contracts was $4 million at March 31, 2021. Reinsurance Related Embedded Derivatives FGL Insurance entered into a reinsurance agreement with Kubera effective December 31, 2018, to cede certain MYGA and deferred annuity statutory reserve on a coinsurance funds withheld basis, net of applicable existing reinsurance. Fair value movements in the funds withheld balances associated with this arrangement create an obligation for FGL Insurance to pay Kubera at a later date, which results in an embedded derivative. This embedded derivative is considered a total return swap with contractual returns that are attributable to the assets and liabilities associated with this reinsurance arrangement. The fair value of the total return swap is based on the change in fair value of the underlying assets held in the funds withheld portfolio. Investment results for the assets that support the coinsurance with funds withheld reinsurance arrangement, including gains and losses from sales, were passed directly to the reinsurer pursuant to contractual terms of the reinsurance arrangement. The reinsurance related embedded derivative is reported in prepaid expenses and other assets if in a net gain position, or accounts payable and accrued liabilities, if in a net loss position, on the unaudited Condensed Consolidated Balance Sheets and the related gains or losses are reported in Recognized gains and losses, net on the unaudited Condensed Consolidated Statements of Earnings. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal and Regulatory Contingencies In the ordinary course of business, we are involved in various pending and threatened litigation matters related to our operations, some of which include claims for punitive or exemplary damages. With respect to our title insurance operations, this customary litigation includes but is not limited to a wide variety of cases arising out of or related to title and escrow claims, for which we make provisions through our loss reserves. See Note B Summary of Reserve for Title Claim Losses for further discussion. Additionally, like other companies, our ordinary course litigation includes a number of class action and purported class action lawsuits, which make allegations related to aspects of our operations. We believe that no actions, other than the matters discussed below, if any, depart from customary litigation incidental to our business. We review lawsuits and other legal and regulatory matters (collectively “legal proceedings”) on an ongoing basis when making accrual and disclosure decisions. When assessing reasonably possible and probable outcomes, management bases its decision on its assessment of the ultimate outcome assuming all appeals have been exhausted. For legal proceedings in which it has been determined that a loss is both probable and reasonably estimable, a liability based on known facts and which represents our best estimate has been recorded. Our accrual for legal and regulatory matters was $15 million and $13 million as of March 31, 2021 and December 31, 2020, respectively. None of the amounts we have currently recorded are considered to be material to our financial condition individually or in the aggregate. Actual losses may materially differ from the amounts recorded and the ultimate outcome of our pending legal proceedings is generally not yet determinable. While some of these matters could be material to our operating results or cash flows for any particular period if an unfavorable outcome results, at present we do not believe that the ultimate resolution of currently pending legal proceedings, either individually or in the aggregate, will have a material adverse effect on our financial condition. Two lawsuits have been filed related to FNF’s acquisition of F&G. On August 4, 2020, a stockholder derivative lawsuit styled, City of Miami General Employees’ and Sanitation Employees’ Retirement Trust v. Fidelity National Financial, et al., was filed in the Court of Chancery of the State of Delaware against the Company, its Board of Directors and others alleging breach of fiduciary duties as directors and officers relating to FNF’s acquisition of F&G. The Company’s Board of Directors (“Board”) has designated a Special Litigation Committee (the “SLC”) consisting of two of the Board’s Directors, and has authorized the SLC, among other things, to investigate and evaluate the claims and allegations asserted in the lawsuit. The Board has also given the SLC the sole authority and power to consider and determine whether or not prosecution of the claims asserted in the lawsuit is in the best interest of the Company and its shareholders, and what action the Company should take with respect to the lawsuit. The parties have agreed to stay the action until June 2021, to allow sufficient time for the SLC to investigate the allegations and provide its evaluation. On August 17, 2020, a lawsuit styled, In the Matter of FGL Holdings, was filed in the Grand Court of the Cayman Islands where dissenting shareholders, Kingfishers LP, Kingstown 1740 Fund LP, Kingstown Partners II LP, Kingstown Partners Master Ltd., and Ktown LP, have asserted statutory appraisal rights relative to their ownership of 12,000,000 shares of F&G stock in connection with the acquisition. They seek a judicial determination of the fair value of their shares of F&G stock under the law of the Cayman Islands, together with interest. Discovery is ongoing. We do not believe the result in either case will have a material adverse effect on our financial condition. From time to time we receive inquiries and requests for information from state insurance departments, attorneys general and other regulatory agencies about various matters relating to our business. Sometimes these take the form of civil investigative demands or subpoenas. We cooperate with all such inquiries and we have responded to or are currently responding to inquiries from multiple governmental agencies. Also, regulators and courts have been dealing with issues arising from foreclosures and related processes and documentation. Various governmental entities are studying the title insurance product, market, pricing, and business practices, and potential regulatory and legislative changes, which may materially affect our business and operations. From time to time, we are assessed fines for violations of regulations or other matters or enter into settlements with such authorities which may require us to pay fines or claims or take other actions. We do not anticipate such fines and settlements, either individually or in the aggregate, will have a material adverse effect on our financial condition. F&G Commitments In our F&G segment, we have unfunded investment commitments as of March 31, 2021 based upon the timing of when investments are executed compared to when the actual investments are funded, as some investments require that funding occur over a period of months or years. A summary of unfunded commitments by invested asset class as of March 31, 2021 is included below (in millions): March 31, 2021 Asset Type Other invested assets $ 584 Fixed maturity securities, available-for-sale 496 Other assets 83 Commercial mortgage loans 46 Residential mortgage loans 4 Total $ 1,213 Subscription Agreements with Acrobat Holdings, Inc., now known as Alight, Inc. ("Alight"), and Foley Trasimene Acquisition Corp. ("FTAC") On January 25, 2021, certain of our wholly-owned subsidiaries, FNTIC, Commonwealth Title, and Chicago Title, entered into common stock subscription agreements (the "FTAC Subscription Agreements") with Alight and FTAC to purchase in the aggregate $150 million of Class A Common Stock, par value $.001 per share, of Alight at a purchase price of $10.00 per share. The closing of the transactions is expected to occur in the second quarter of 2021. For further information related to the FTAC Subscription Agreements, refer to Note A Basis of Presentation in our most recent Annual Report on Form 10-K for the year ended December 31, 2020. |
Dividends
Dividends | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Dividends | DividendsOn May 6, 2021, our Board of Directors declared cash dividends of $0.36 per share, payable on June 30, 2021, to FNF common shareholders of record as of June 16, 2021. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Summarized financial information concerning our reportable segments is shown in the following tables. On June 1, 2020, we completed our acquisition of F&G. As a result we have a new segment as of and for the three months ended March 31, 2021, F&G, which contains our fixed annuity and life insurance businesses. As of and for the three months ended March 31, 2021: Title F&G Corporate and Other Total (In millions) Title premiums $ 1,804 $ — $ — $ 1,804 Other revenues 745 64 42 851 Revenues from external customers 2,549 64 42 2,655 Interest and investment income, including recognized gains and losses (30) 475 — 445 Total revenues 2,519 539 42 3,100 Depreciation and amortization 33 144 6 183 Interest expense — 8 20 28 Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated affiliates 439 356 (38) 757 Income tax expense (benefit) 103 72 (9) 166 Earnings (loss) before equity in earnings (loss) of unconsolidated affiliates 336 284 (29) 591 Equity in earnings (loss) of unconsolidated affiliates 8 — 5 13 Net earnings (loss) from continuing operations $ 344 $ 284 $ (24) $ 604 Assets $ 9,389 $ 40,614 $ 1,486 $ 51,489 Goodwill 2,481 1,751 266 4,498 As of and for the three months ended March 31, 2020: Title Corporate and Other Total (In millions) Title premiums $ 1,278 $ — $ 1,278 Other revenues 610 (9) 601 Revenues from external customers 1,888 (9) 1,879 Interest and investment income, including recognized gains and losses (265) (2) (267) Total revenues 1,623 (11) 1,612 Depreciation and amortization 37 6 43 Interest expense — 12 12 Loss before income taxes and equity in earnings of unconsolidated affiliates (53) (33) (86) Income tax benefit (19) (9) (28) Loss before equity in earnings of unconsolidated affiliates (34) (24) (58) Equity in earnings of unconsolidated affiliates 1 — 1 Net loss $ (33) $ (24) $ (57) Assets $ 8,728 $ 1,476 $ 10,204 Goodwill 2,460 266 2,726 The activities in our segments include the following: • Title. This segment consists of the operations of our title insurance underwriters and related businesses. This segment provides core title insurance and escrow and other title-related services including trust activities, trustee sales guarantees, and home warranty products. This segment also includes our transaction services business, which includes other title-related services used in the production and management of mortgage loans, including mortgage loans that experience default. • F&G . This segment consists of operations of our annuities and life insurance related businesses. This segment issues a broad portfolio of deferred annuities (fixed index and fixed rate annuities), immediate annuities and indexed universal life insurance. • Corporate and Other. This segment consists of the operations of the parent holding company, our real estate technology subsidiaries and our remaining real estate brokerage businesses. This segment also includes certain other unallocated corporate overhead expenses and eliminations of revenues and expenses between it and our Title segment. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information The following supplemental cash flow information is provided with respect to certain cash payment and non-cash investing and financing activities. Three months ended March 31, 2021 2020 Cash paid for: Interest $ 29 $ 22 Income taxes 7 4 Deferred sales inducements 21 — Non-cash investing and financing activities: Change in proceeds of sales of investments available for sale receivable in period $ (9) $ — Change in purchases of investments available for sale payable in period 164 — Change in treasury stock purchases payable in period — 5 Lease liabilities recognized in exchange for lease right-of-use assets 5 8 Remeasurement of lease liabilities 13 22 |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of Revenue Our revenue consists of: Three months ended March 31, 2021 2020 Revenue Stream Income Statement Classification Segment Total Revenue Revenue from insurance contracts: (in millions) Direct title insurance premiums Direct title insurance premiums Title $ 746 $ 546 Agency title insurance premiums Agency title insurance premiums Title 1,058 732 Life insurance premiums, insurance and investment product fees, and other Escrow, title-related and other fees F&G 64 — Home warranty Escrow, title-related and other fees Title 39 43 Total revenue from insurance contracts 1,907 1,321 Revenue from contracts with customers: Escrow fees Escrow, title-related and other fees Title 324 221 Other title-related fees and income Escrow, title-related and other fees Title 205 159 ServiceLink, excluding title premiums, escrow fees, and subservicing fees Escrow, title-related and other fees Title 90 106 Real estate technology Escrow, title-related and other fees Corporate and other 32 27 Real estate brokerage Escrow, title-related and other fees Corporate and other — 6 Other Escrow, title-related and other fees Corporate and other 10 (42) Total revenue from contracts with customers 661 477 Other revenue: Loan subservicing revenue Escrow, title-related and other fees Title 87 81 Interest and investment income Interest and investment income Various 402 53 Recognized gains and losses, net Recognized gains and losses, net Various 43 (320) Total revenues Total revenues $ 3,100 $ 1,612 Our Direct title insurance premiums are recognized as revenue at the time of closing of the underlying transaction as the earnings process is then considered complete. Regulation of title insurance rates varies by state. Premiums are charged to customers based on rates predetermined in coordination with each states' respective Department of Insurance. Cash associated with such revenue is typically collected at closing of the underlying real estate transaction. Premium revenues from agency title operations are recognized when the underlying title order and transaction closing, if applicable, are complete. Revenues from our home warranty business are generated from contracts with customers to provide warranty for major home appliances. Substantially all of our home warranty contracts are one year in length and revenue is recognized ratably over the term of the contract. Escrow fees and Other title-related fees and income in our Title segment are closely related to Direct title insurance premiums and are primarily associated with managing the closing of real estate transactions including the processing of funds on behalf of the transaction participants, gathering and recording the required closing documents, providing notary and home inspection services, and other real estate or title-related activities. Revenue is primarily recognized upon closing of the underlying real estate transaction or completion of services. Cash associated with such revenue is typically collected at closing. Revenues from ServiceLink, excluding its title premiums, escrow fees and loan subservicing fees primarily include revenues from real estate appraisal services and foreclosure processing and facilitation services. Revenues from real estate appraisal services are recognized when all appraisal work is complete, a final report is issued to the client and the client is billed. Revenues from foreclosure processing and facilitation services are primarily recognized upon completion of the services and when billing to the client is complete. Life insurance premiums in our F&G segment reflect premiums for traditional life insurance products and life-contingent immediate annuity products which are recognized as revenue when due from the policyholder. We have ceded the majority of our traditional life business to unaffiliated third party reinsurers. While the base contract has been reinsured, we continue to retain the return of premium rider. Insurance and investment product fees and other consist primarily of the cost of insurance on IUL policies, unearned revenue ("UREV") on IUL policies, policy rider fees primarily on FIA policies and surrender charges assessed against policy withdrawals in excess of the policyholder's allowable penalty-free amounts. Real estate technology revenues are primarily comprised of subscription fees for use of software provided to real estate professionals. Subscriptions are only offered on a month-by-month basis and fees are billed monthly. Revenue is recognized in the month services are provided. Real estate brokerage revenues are primarily comprised of commission revenues earned in association with the facilitation of real estate transactions and are recognized upon closing of the sale of the underlying real estate transaction. Loan subservicing revenues are generated by certain subsidiaries of ServiceLink and are associated with the servicing of mortgage loans on behalf of its customers. Revenue is recognized when the underlying work is performed and billed. Loan subservicing revenues are subject to the recognition requirements of ASC Topic 860. Interest and investment income consists primarily of interest payments received on fixed maturity security holdings and dividends received on equity and preferred security holdings. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, primarily related to revenue from our home warranty business, and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Contract Balances The following table provides information about trade receivables and deferred revenue: March 31, 2021 December 31, 2020 (In millions) Trade receivables $ 390 $ 404 Deferred revenue (contract liabilities) 116 117 Deferred revenue is recorded primarily for our home warranty contracts. Revenues from home warranty products are recognized over the life of the policy, which is primarily one year. The unrecognized portion is recorded as deferred revenue in accounts payable and other accrued liabilities in the unaudited Condensed Consolidated Balance Sheets. During the three months ended March 31, 2021, we recognized $41 million of revenue, which was included in deferred revenue at the beginning of the period. |
Value of Business Acquired, Def
Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements | Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements A summary of the changes in the carrying amounts of the Company's VOBA, DAC and DSI intangible assets are as follows (in millions): VOBA DAC DSI Total Balance at December 31, 2020 $ 1,466 $ 222 $ 36 $ 1,724 Deferrals — 133 21 154 Amortization (132) (8) (8) (148) Interest 8 2 — 10 Unlocking 1 — — 1 Adjustment for net unrealized investment (gains) losses 132 (5) — 127 Balance at March 31, 2021 $ 1,475 $ 344 $ 49 $ 1,868 Amortization of VOBA, DAC, and DSI is based on the current and future expected gross margins or profits recognized, including investment gains and losses. The interest accrual rate utilized to calculate the accretion of interest on VOBA ranged from 0% to 4.71%. The adjustment for unrealized net investment losses (gains) represents the amount of VOBA, DAC, and DSI that would have been amortized if such unrealized gains and losses had been recognized. This is referred to as the “shadow adjustments” as the additional amortization is reflected in AOCI rather than the unaudited Condensed Consolidated Statements of Earnings. As of March 31, 2021, the VOBA balances included cumulative adjustments for net unrealized investment gains of $152 million, the DAC balances included cumulative adjustments for net unrealized investment gains of $30 million, and the DSI balance included net unrealized investment gains of $4 million. For the inforce liabilities as of March 31, 2021, the estimated amortization expense for VOBA in future fiscal periods is as follows (in millions): Estimated Amortization Expense Fiscal Year 2021 59 2022 190 2023 185 2024 172 2025 168 Thereafter 853 |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued OperationsIn connection with the F&G acquisition, certain third party offshore reinsurance businesses acquired were deemed discontinued operations and are presented as such within our Condensed Consolidated Statements of Earnings for the three months ended March 31, 2021. |
F&G Reinsurance
F&G Reinsurance | 3 Months Ended |
Mar. 31, 2021 | |
Reinsurance Disclosures [Abstract] | |
F&G Reinsurance | F&G Reinsurance F&G reinsures portions of its policy risks with other insurance companies. The use of indemnity reinsurance does not discharge an insurer from liability on the insurance ceded. The insurer is required to pay in full the amount of its insurance liability regardless of whether it is entitled to or able to receive payment from the reinsurer. The portion of risks exceeding F&G's retention limit is reinsured. F&G primarily seeks reinsurance coverage in order to limit its exposure to mortality losses and enhance capital management. F&G follows reinsurance accounting when there is adequate risk transfer. If the underlying policy being reinsured is an investment contract or there is inadequate risk transfer, deposit accounting is followed. The effect of reinsurance on net premiums earned and net benefits incurred (benefits paid and reserve changes) for the three months ended March 31, 2021 were as follows (in millions): Three months ended March 31, 2021 Net Premiums Earned Net Benefits Incurred Direct $ 44 $ 293 Ceded (33) (319) Net $ 11 $ (26) Amounts payable or recoverable for reinsurance on paid and unpaid claims are not subject to periodic or maximum limits. F&G did not write off any significant reinsurance balances during the three months ended March 31, 2021. F&G did not commute any ceded reinsurance treaties during the three months ended March 31, 2021. Following the adoption of ASC 326, F&G estimates expected credit losses on reinsurance recoverables using a probability of default/loss given default model. Significant inputs to the model include the reinsurers credit risk, expected timing of recovery, industry-wide historical default experience, senior unsecured bond recovery rates, and credit enhancement features. During the three months ended March 31, 2021, the expected credit loss reserve was not adjusted and remained at $21 million as of March 31, 2021. No policies issued by F&G have been reinsured with any foreign company, which is controlled, either directly or indirectly, by a party not primarily engaged in the business of insurance. F&G has not entered into any reinsurance agreements in which the reinsurer may unilaterally cancel any reinsurance for reasons other than non-payment of premiums or other similar credit issues. Effective May 1, 2020, FGL Insurance entered into an indemnity reinsurance agreement with Canada Life Assurance Company United States Branch, a third party reinsurer, to reinsure FIA policies with guaranteed minimum withdrawal benefits ("GMWB"). In accordance with the terms of this agreement, FGL Insurance cedes a quota share percentage of the net retention of guarantee payments in excess of account value for GMWB. Effective January 1, 2021, FGL Insurance amended to include the GMWB rider for product F&G SecureIncome 7. The effects of this agreement are not accounted for as reinsurance as it does not satisfy the risk transfer requirements for GAAP, since it is not “reasonably possible” that the reinsurer may realize significant loss from assuming the insurance risk. On January 15, 2021, FGL Insurance executed a Funds Withheld Coinsurance Agreement with ASPIDA Life Re Ltd, a Bermuda reinsurer. The effective date of the agreement is January 1, 2021. In accordance with the terms of this agreement, F&G shall cede to the reinsurer, on a fifty percent (50%) funds withheld coinsurance basis, certain multiyear guaranteed annuity business written effective January 1, 2021. Concentration of Reinsurance Risk F&G has a significant concentration of reinsurance risk with third party reinsurers, Wilton Reassurance Company (“Wilton Re”) and Kubera, that could have a material impact on the Company’s financial position in the event that either Wilton Re or Kubera fail to perform their obligations under the various reinsurance treaties. Wilton Re is a wholly-owned subsidiary of Canada Pension Plan Investment Board ("CPPIB"). CPPIB has an AAA issuer credit rating from Standard & Poor's Ratings Services ("S&P") as of March 31, 2021. Kubera is not rated, however, management has attempted to mitigate the risk of non-performance through the funds withheld arrangement. As of March 31, 2021, the net amount recoverable from Wilton Re was $1,489 million and the net amount recoverable from Kubera was $803 million. The Company monitors both the financial condition of individual reinsurers and risk concentration arising from similar activities and economic characteristics of reinsurers to attempt to reduce the risk of default by such reinsurers. The Company believes that all amounts due from Wilton Re and Kubera for periodic treaty settlements are collectible as of March 31, 2021. On March 6, 2019, Scottish Re (U.S.), Inc. (“SRUS”), a Delaware domestic life and health reinsurer of FGL Insurance, was ordered into receivership for purposes of rehabilitation. As of March 31, 2021, the net amount recoverable from SRUS was $50 million. The financial exposure related to these ceded reserves are substantially mitigated via a reinsurance agreement whereby Wilton Re assumes treaty non-performance including credit risk for this business. On July 9, 2019, Pavonia Life Insurance Company of Michigan ("Pavonia"), a Michigan domiciled life, accident, and health insurance company, was placed into rehabilitation. While the court order indicated that Pavonia had a stable financial condition and lack of non-insurance affiliated investments, the Director of the Michigan Department of Insurance and Financial Services ("MDIFS") has concerns relating to Pavonia's parent company. To insulate Pavonia from its parent until a pending acquisition transaction could be consummated, MDIFS placed Pavonia under supervision and rehabilitation. As of March 31, 2021, the net amount recoverable from Pavonia was $94 million. The financial exposure related to these ceded reserves is substantially mitigated via a reinsurance agreement whereby Wilton Re assumes treaty non-performance including credit risk for this business. There have been no other material changes in the reinsurance and the intercompany reinsurance agreements described in our Annual Report on Form 10-K for the year ended December 31, 2020. |
F&G Insurance Subsidiary Financ
F&G Insurance Subsidiary Financial Information and Regulatory Matters | 3 Months Ended |
Mar. 31, 2021 | |
Insurance [Abstract] | |
F&G Insurance Subsidiary Financial Information and Regulatory Matters | Summary of Reserve for Title Claim Losses A summary of the reserve for title claim losses follows: Three months ended March 31, 2021 2020 (Dollars in millions) Beginning balance $ 1,623 $ 1,509 Change in insurance recoverable 25 (1) Claim loss provision related to: Current year 81 58 Prior years — — Total title claim loss provision 81 58 Claims paid, net of recoupments related to: Current year — — Prior years (46) (48) Total title claims paid, net of recoupments (46) (48) Ending balance of claim loss reserve for title insurance $ 1,683 $ 1,518 Provision for title insurance claim losses as a percentage of title insurance premiums 4.5 % 4.5 % Several lawsuits have been filed by various parties against Chicago Title Company and Chicago Title Insurance Company as its alter ego (collectively, the “Named Companies”), among others. Generally, plaintiffs claim they are investors who were solicited by Gina Champion-Cain to provide funds that purportedly were to be used for high-interest, short-term loans to parties seeking to acquire California alcoholic beverage licenses. Plaintiffs contend that under California state law, alcoholic beverage license applicants are required to escrow an amount equal to the license purchase price while their applications remain pending with the State. Plaintiffs further alleged that employees of Chicago Title Company participated with Ms. Champion-Cain and her entities in a fraud scheme involving an escrow account maintained by Chicago Title Company into which the plaintiffs’ funds were deposited. The Named Companies have settled or conditionally settled with various parties and/or are participating in court-ordered mediation with all other parties in an effort to fully resolve the claims related to this matter. The following lawsuits were filed in the Superior Court of San Diego County for the State of California. While they have not been consolidated into one action, they have been deemed by the court to be related and are assigned to the same judge for purposes of judicial economy. Unless otherwise noted below, the Named Companies have or will respond to the operative complaints by the respective due dates. On December 13, 2019, a lawsuit styled, Kim Funding, LLC, Kim H. Peterson, Joseph J. Cohen, and ABC Funding Strategies, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in San Diego County Superior Court. Plaintiffs claim losses of more than $250 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. The Named Companies have filed a cross-complaint against Ms. Champion-Cain, among others. On March 6, 2020, a lawsuit styled, Wakefield Capital, LLC, Wakefield Investments, LLC, 2Budz Holding, LLC, Doug and Kristine Heidrich, and Jeff and Heidi Orr v. Chicago Title Co. and Chicago Title Ins. Co., was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $7 million as a result of the alleged fraud scheme, and also seek punitive damages, recovery of attorneys’ fees, and disgorgement. On March 16, 2020, a lawsuit styled, Randolph L. Levin, et al., v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, Betty Elixman, et al., was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $38 million as a result of the alleged fraud scheme, and also seek punitive damages and the recovery of attorneys’ fees. This matter has conditionally settled under confidential terms following mediation. On May 29, 2020, a lawsuit styled, Mark Atherton, et al., v. Chicago Title Co. and Chicago Title Ins. Co., was filed in was filed in San Diego County Superior Court. Plaintiffs claim losses of more than $30 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages, as well as the recovery of attorneys’ fees. This matter has conditionally settled under confidential terms. On June 29, 2020, a lawsuit styled, Susan Heller Fenley Separate Property Trust, DTD 03/04/2010, Susan Heller Fenley Inherited Roth IRA, Shelley Lynn Tarditi Trust and ROJ, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $6 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. On June 29, 2020, a lawsuit styled, Yuan Yu and Polly Yu v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in San Diego County Superior Court. Plaintiffs claim losses in excess of $1 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. On July 7, 2020, a cross-claim styled, Laurie Peterson v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in an existing lawsuit styled, Banc of California, National Association v. Laurie Peterson, which is pending in San Diego County Superior Court. Cross-complaint plaintiff was sued by a bank to recover in excess of $35 million that she allegedly guaranteed to repay for certain investments made by the Banc of California in the alcoholic beverage license scheme. Cross-complaint plaintiff has, in turn, sued the Named Companies in that action seeking in excess of $250 million in monetary losses as well as exemplary damages and attorneys’ fees. On September 3, 2020, a cross-claim styled, Kim H. Peterson Trustee of the Peterson Family Trust dated April 14 1992 v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman, was filed in an existing lawsuit styled, CalPrivate Bank v. Kim H. Peterson Trustee of the Peterson Family Trust dated April 14 1992, which is pending in Superior Court of San Diego County for the State of California. Cross-complaint plaintiff was sued by a bank to recover in excess of $12 million that the trustee allegedly guaranteed to repay for certain investments made by CalPrivate Bank in the alcoholic beverage license scheme. Cross-complaint plaintiff has, in turn, sued the Named Companies in that action seeking in excess of $250 million in monetary losses as well as exemplary damages and attorneys’ fees. On October 1, 2020, a lawsuit styled, Ovation Fin. Holdings 2 LLC, Ovation Fund Mgmt. II, LLC, Banc of California, N.A. v. Chicago Title Ins. Co., was filed in San Diego County Superior Court. Plaintiffs claim losses of more than $75 million, as well as consequential and punitive damages. The Named Companies have filed a cross-complaint against Ms. Champion-Cain, among others. On November 2, 2020, a lawsuit styled, CalPrivate Bank v. Chicago Title Co. and Chicago Title Ins. Co., was also filed in the Superior Court of San Diego County for the State of California. Plaintiff claims losses in excess of $12 million based upon business loan advances made in the alcoholic beverage license scheme, and also seeks punitive damages and the recovery of attorneys’ fees. The Named Companies have filed a cross-complaint against Ms. Champion-Cain, among others. On February 24, 2021, a putative class action lawsuit styled, Blake E. Allred and Melissa M. Allred v. Chicago Title Co., Chicago Title Ins. Co., was filed in the Superior Court of San Diego County for the State of California. Plaintiffs are seeking compensatory, statutory, treble, and punitive damages. On October 23, 2020, a lawsuit styled, DH Claims LLC v. Chicago Title Co., Chicago Title Ins. Co., and Della Ducharme, was filed in the Superior Court of Orange County for the State of California. Plaintiff claims losses in excess of $2 million as a result of the alleged fraud scheme, and also seeks statutory, treble, and punitive damages, as well as the recovery of attorneys’ fees. This matter has conditionally settled under confidential terms. In addition, Chicago Title Company has conditionally resolved claims from both individual investors and a group of alleged investors under confidential terms during pre-suit mediations. As of March 31, 2021, the Company has recorded an incurred claim loss reserve for legal fees and any remaining unpaid amounts relating to losses on the matters resolved confidentially mentioned above which is included in its consolidated reserve for title claim losses. The Company has also recorded an insurance recoverable for amounts that it expects to recover from its insurance carriers relating to these matters. At this time, the Company is unable to ascertain its liability, if any, and is unable to make an estimate of a reasonably possible claim loss for any of the unresolved claims due to the complex nature of the claims and litigation, the early procedural status of each claim (involving unresolved questions of fact without any rulings on the merits or determinations of liability), the extent of discovery not yet conducted, potential insurance coverage, and an incomplete evaluation of possible defenses, counterclaims, crossclaims or third-party claims that may exist. Moreover, it is likely that in some instances, the claims listed above are duplicative. As further information becomes available, the Company will continue to evaluate the adequacy of its consolidated reserve for title claim losses. As of March 31, 2021, the Company believes that its reserves are adequate to cover its losses related to this matter and other claims. We continually upda te loss reserve estimates as new information becomes known, new loss patterns emerge or as other contributing factors are considered and incorporated into the analysis of reserve for claim losses. Estimating future title loss payments is difficult because of the complex nature of title claims, the long periods of time over which claims are paid, significantly varying dollar amounts of individual claims and other factors. Due to the uncertainty inherent in the process and to the judgment used by management, the ultimate liability may be greater or less than our current reserves. If actual claims loss development varies from what is currently expected and is not offset by other factors, it is possible that additional reserve adjustments may be required in future periods in order to maintain our recorded reserve within a reasonable range of our actuary's central estimate. Our U.S. insurance subsidiaries, FGL Insurance, Fidelity & Guaranty Life Insurance Company of New York ("FGL NY Insurance"), and Raven Re, file financial statements with state insurance regulatory authorities and the National Association of Insurance Commissioners (“NAIC”) that are prepared in accordance with Statutory Accounting Principles (“SAP”) prescribed or permitted by such authorities, which may vary materially from GAAP. Prescribed SAP includes the Accounting Practices and Procedures Manual of the NAIC as well as state laws, regulations and administrative rules. Permitted SAP encompasses all accounting practices not so prescribed. The principal differences between SAP financial statements and financial statements prepared in accordance with GAAP are that SAP financial statements do not reflect DAC, DSI and VOBA, some bond portfolios may be carried at amortized cost, assets and liabilities are presented net of reinsurance, contractholder liabilities are generally valued using more conservative assumptions and certain assets are non-admitted. Accordingly, SAP operating results and SAP capital and surplus may differ substantially from amounts reported in the GAAP basis financial statements for comparable items. FSRC (Cayman) and F&G Life Re (Bermuda) file financial statements with their respective regulators that are based on U.S. GAAP. FGL Insurance applies Iowa-prescribed accounting practices that permit Iowa-domiciled insurers to report equity call options used to economically hedge FIA index credits at amortized cost for statutory accounting purposes and to calculate FIA statutory reserves such that index credit returns will be included in the reserve only after crediting to the annuity contract. This resulted in a $133 million and $144 million decrease to statutory capital and surplus at March 31, 2021 and December 31, 2020, respectively. FGL Insurance’s statutory carrying value of Raven Re reflects the effect of permitted practices Raven Re received to treat the available amount of a letter of credit as an admitted asset which increased Raven Re’s statutory capital and surplus by $85 million at March 31, 2021 and December 31, 2020. Raven Re is also permitted to follow Iowa prescribed statutory accounting practice for its reserves on reinsurance assumed from FGL Insurance which increased Raven Re’s statutory capital and surplus by $5 million at March 31, 2021 and December 31, 2020. Without such permitted statutory accounting practices Raven Re’s statutory capital and surplus (deficit) would be less than $1 million as of March 31, 2021 and would be $(6) million as of December 31, 2020, and its risk-based capital would fall below the minimum regulatory requirements. The letter of credit facility is collateralized by NAIC 1 rated debt securities. If the permitted practice was revoked, the letter of credit could be replaced by the collateral assets with Nomura’s consent. FGL Insurance’s statutory carrying value of Raven Re was $90 million and $84 million at March 31, 2021 and December 31, 2020, respectively. As of March 31, 2021, FGL NY Insurance did not follow any prescribed or permitted statutory accounting practices that differ from the NAIC's statutory accounting practices. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2021 | |
Business Combinations [Abstract] | |
Acquisitions | AcquisitionsF&GOn June 1, 2020, we acquired 100% of the outstanding equity of F&G for approximately $2.7 billion. The acquisition was accounted for as a business combination under FASB Accounting Standards Codification Topic 805, Business Combinations ("Topic 805"). The purchase price has been allocated to F&G's assets acquired and liabilities assumed based on our best estimates of their fair values as of the acquisition date. The fair value of assets acquired and liabilities assumed represent a preliminary allocation as our evaluation of facts and circumstances available as of June 1, 2020 is ongoing. We expect to finalize the purchase price allocation as soon as practicable, but no later than one year from the acquisition date. During the three months ended March 31, 2021, there were no changes to our preliminary allocation of purchase price. |
Basis of Financial Statements (
Basis of Financial Statements (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | The financial information in this report presented for interim periods is unaudited and includes the accounts of Fidelity National Financial, Inc. and its subsidiaries (collectively, “we,” “us,” “our,” the "Company" or “FNF”) prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All adjustments made were of a normal, recurring nature. This report should be read in conjunction with our Annual Report on Form 10-K (our "Annual Report") for the year ended December 31, 2020. |
Earnings Per Share | Earnings Per Share Basic earnings per share, as presented on the Condensed Consolidated Statement of Earnings, is computed by dividing net earnings available to common shareholders in a given period by the weighted average number of common shares outstanding during such period. In periods when earnings are positive, diluted earnings per |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Adopted Pronouncements In December 2019, the FASB issued ASU 2019-12 Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740), which simplifies various aspects of the income tax accounting guidance and will be applied using different approaches depending on what the specific amendment relates to and, for public entities, are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We adopted this standard as of January 1, 2021, and it had no impact on our unaudited Condensed Consolidated Financial Statements upon adoption. In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20, Receivables - Nonrefundable Fees and Other Costs. The amendments in this update clarify that callable debt securities should be re-evaluated each reporting period to determine if the amortized cost exceeds the amount repayable by the issuer at the next earliest call date, and, if so, the excess should be amortized to the next call date. We adopted this standard as of January 1, 2021 and are applying this guidance on a prospective basis. This pronouncement had no impact on our unaudited Condensed Consolidated Financial Statements upon adoption. Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-12, Financial Services-Insurance (Topic 944), Targeted Improvements to the Accounting for Long-Duration Contracts, effective for fiscal years beginning after December 15, 2022 including interim periods within those fiscal years. This update introduced the following requirements: assumptions used to measure cash flows for traditional and limited-payment contracts must be reviewed at least annually with the effect of changes in those assumptions being recognized in the statement of operations; the discount rate applied to measure the liability for future policy benefits and limited-payment contracts must be updated at each reporting date with the effect of changes in the rate being recognized in other comprehensive income; market risk benefits associated with deposit contracts must be measured at fair value, with the effect of the change in the fair value attributable to a change in the instrument-specific credit risk being recognized in other comprehensive income; deferred acquisition costs are required to be amortized in proportion to premiums, gross profits, or gross margins and those balances must be amortized on a constant level basis over the expected term of the related contracts; deferred acquisition costs must be written off for unexpected contract terminations; and disaggregated rollforwards of beginning to ending balances of the liability for future policy benefits, policyholder account balances, market risk benefits, separate account liabilities and deferred acquisition costs, as well as information about significant inputs, judgments, assumptions, and methods used in measurement are required to be disclosed. The amendments in this ASU may be early adopted as of the beginning of an annual reporting period for which financial statements have not yet been issued, including interim financial statements. We do not currently expect to early adopt this standard. We have identified specific areas that will be impacted by the new guidance and are in the process of assessing the accounting, reporting and/or process changes that will be required to comply as well as the impact of the new guidance on our consolidated financial statements. |
Revenue Recognition | Our Direct title insurance premiums are recognized as revenue at the time of closing of the underlying transaction as the earnings process is then considered complete. Regulation of title insurance rates varies by state. Premiums are charged to customers based on rates predetermined in coordination with each states' respective Department of Insurance. Cash associated with such revenue is typically collected at closing of the underlying real estate transaction. Premium revenues from agency title operations are recognized when the underlying title order and transaction closing, if applicable, are complete.Revenues from our home warranty business are generated from contracts with customers to provide warranty for major home appliances. Substantially all of our home warranty contracts are one year in length and revenue is recognized ratably over the term of the contract. |
Revenue Recognition, Other | Interest and investment income consists primarily of interest payments received on fixed maturity security holdings and dividends received on equity and preferred security holdings. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, primarily related to revenue from our home warranty business, and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. |
Revenue Recognition, Services, Real Estate Transactions | Escrow fees and Other title-related fees and income in our Title segment are closely related to Direct title insurance premiums and are primarily associated with managing the closing of real estate transactions including the processing of funds on behalf of the transaction participants, gathering and recording the required closing documents, providing notary and home inspection services, and other real estate or title-related activities. Revenue is primarily recognized upon closing of the underlying real estate transaction or completion of services. Cash associated with such revenue is typically collected at closing. Revenues from ServiceLink, excluding its title premiums, escrow fees and loan subservicing fees primarily include revenues from real estate appraisal services and foreclosure processing and facilitation services. Revenues from real estate appraisal services are recognized when all appraisal work is complete, a final report is issued to the client and the client is billed. Revenues from foreclosure processing and facilitation services are primarily recognized upon completion of the services and when billing to the client is complete. Life insurance premiums in our F&G segment reflect premiums for traditional life insurance products and life-contingent immediate annuity products which are recognized as revenue when due from the policyholder. We have ceded the majority of our traditional life business to unaffiliated third party reinsurers. While the base contract has been reinsured, we continue to retain the return of premium rider. Insurance and investment product fees and other consist primarily of the cost of insurance on IUL policies, unearned revenue ("UREV") on IUL policies, policy rider fees primarily on FIA policies and surrender charges assessed against policy withdrawals in excess of the policyholder's allowable penalty-free amounts. Real estate technology revenues are primarily comprised of subscription fees for use of software provided to real estate professionals. Subscriptions are only offered on a month-by-month basis and fees are billed monthly. Revenue is recognized in the month services are provided. Real estate brokerage revenues are primarily comprised of commission revenues earned in association with the facilitation of real estate transactions and are recognized upon closing of the sale of the underlying real estate transaction. Loan subservicing revenues are generated by certain subsidiaries of ServiceLink and are associated with the servicing of mortgage loans on behalf of its customers. Revenue is recognized when the underlying work is performed and billed. Loan subservicing revenues are subject to the recognition requirements of ASC Topic 860. |
Summary of Reserve for Title _2
Summary of Reserve for Title Claim Losses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Insurance [Abstract] | |
Summary of the Reserve for Claim Losses | A summary of the reserve for title claim losses follows: Three months ended March 31, 2021 2020 (Dollars in millions) Beginning balance $ 1,623 $ 1,509 Change in insurance recoverable 25 (1) Claim loss provision related to: Current year 81 58 Prior years — — Total title claim loss provision 81 58 Claims paid, net of recoupments related to: Current year — — Prior years (46) (48) Total title claims paid, net of recoupments (46) (48) Ending balance of claim loss reserve for title insurance $ 1,683 $ 1,518 Provision for title insurance claim losses as a percentage of title insurance premiums 4.5 % 4.5 % Several lawsuits have been filed by various parties against Chicago Title Company and Chicago Title Insurance Company as its alter ego (collectively, the “Named Companies”), among others. Generally, plaintiffs claim they are investors who were solicited by Gina Champion-Cain to provide funds that purportedly were to be used for high-interest, short-term loans to parties seeking to acquire California alcoholic beverage licenses. Plaintiffs contend that under California state law, alcoholic beverage license applicants are required to escrow an amount equal to the license purchase price while their applications remain pending with the State. Plaintiffs further alleged that employees of Chicago Title Company participated with Ms. Champion-Cain and her entities in a fraud scheme involving an escrow account maintained by Chicago Title Company into which the plaintiffs’ funds were deposited. The Named Companies have settled or conditionally settled with various parties and/or are participating in court-ordered mediation with all other parties in an effort to fully resolve the claims related to this matter. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Carrying at Fair Value on Recurring Basis | The carrying amounts and estimated fair values of our financial instruments for which the disclosure of fair values is required, including financial assets and liabilities measured and carried at fair value on a recurring basis, with the exception of investment contracts, portions of other long-term investments and debt which are disclosed later within this footnote, was summarized according to the hierarchy previously described, as follows (in millions): March 31, 2021 Level 1 Level 2 Level 3 Fair Value Carrying Amount Assets Cash and cash equivalents $ 3,026 $ — $ — $ 3,026 $ 3,026 Fixed maturity securities, available-for-sale: Asset-backed securities — 5,069 1,593 6,662 6,662 Commercial mortgage-backed securities — 2,865 25 2,890 2,890 Corporates 36 13,182 1,246 14,464 14,464 Hybrids 161 791 — 952 952 Municipals — 1,376 41 1,417 1,417 Residential mortgage-backed securities — 320 487 807 807 U.S. Government 339 — — 339 339 Foreign Governments — 170 17 187 187 Equity securities 838 590 8 1,436 1,436 Preferred securities 480 812 1 1,293 1,293 Derivative investments 1 541 — 542 542 Short term investments 105 19 — 124 124 Other long-term investments — — 48 48 48 Total financial assets at fair value $ 4,986 $ 25,735 $ 3,466 $ 34,187 $ 34,187 Liabilities Fair value of future policy benefits — — — — — Derivatives: FIA embedded derivatives, included in contractholder funds — — 3,293 3,293 3,293 Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities — 75 — 75 75 Subscription agreements — 4 — 4 4 Preferred shares reimbursement feature embedded derivative — — 4 4 4 Total financial liabilities at fair value $ — $ 79 $ 3,297 $ 3,376 $ 3,376 December 31, 2020 Level 1 Level 2 Level 3 Fair Value Carrying Amount Assets Cash and cash equivalents $ 2,719 $ — $ — $ 2,719 $ 2,719 Fixed maturity securities, available-for-sale: Asset-backed securities — 4,916 1,350 6,266 6,266 Commercial mortgage-backed securities — 2,803 26 2,829 2,829 Corporates 25 13,421 1,289 14,735 14,735 Hybrids 175 815 4 994 994 Municipals — 1,360 43 1,403 1,403 Residential mortgage-backed securities — 342 483 825 825 U.S. Government 342 — — 342 342 Foreign Governments — 176 17 193 193 Equity securities 791 — 5 796 796 Preferred securities 490 851 — 1,341 1,341 Subscription agreements (1) — 199 — 199 199 Derivative investments — 548 — 548 548 Short term investments 769 — — 769 769 Other long-term investments — — 50 50 50 Total financial assets at fair value $ 5,311 $ 25,431 $ 3,267 $ 34,009 $ 34,009 Liabilities Fair value of future policy benefits — — 5 5 5 Derivatives: FIA embedded derivatives, included in contractholder funds — — 3,404 3,404 3,404 Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities — 101 — 101 101 Total financial liabilities at fair value $ — $ 101 $ 3,409 $ 3,510 $ 3,510 (1) Included within equity securities in the accompanying Condensed Consolidated Balance Sheets as of December 31, 2020. The following tables provide the carrying value and estimated fair value of our financial instruments that are carried on the unaudited Condensed Consolidated Balance Sheets at amounts other than fair value, summarized according to the fair value hierarchy previously described. March 31, 2021 (in millions) Level 1 Level 2 Level 3 Total Estimated Fair Value Carrying Amount Assets FHLB common stock $ — $ 64 $ — $ 64 $ 64 Commercial mortgage loans — — 1,197 1,197 1,206 Residential mortgage loans — — 1,154 1,154 1,168 Policy loans — — 34 34 34 Other invested assets — — 26 26 26 Company-owned life insurance — — 309 309 309 Trade and notes receivables, net of allowance — — 425 425 425 Total $ — $ 64 $ 3,145 $ 3,209 $ 3,232 Liabilities Investment contracts, included in contractholder funds $ — $ — $ 22,880 $ 22,880 $ 26,244 Debt — 2,796 — 2,796 2,663 Total $ — $ 2,796 $ 22,880 $ 25,676 $ 28,907 December 31, 2020 (in millions) Level 1 Level 2 Level 3 Total Estimated Fair Value Carrying Amount Assets FHLB common stock $ — $ 66 $ — $ 66 $ 66 Commercial mortgage loans — — 926 926 903 Residential mortgage loans — — 1,123 1,123 1,128 Policy loans — — 33 33 33 Other invested assets — — 28 28 28 Company-owned life insurance — — 305 305 305 Trade and notes receivables, net of allowance — — 437 437 437 Total $ — $ 66 $ 2,852 $ 2,918 $ 2,900 Liabilities Investment contracts, included in contractholder funds $ — $ — $ 21,719 $ 21,719 $ 25,199 Debt — 2,896 — 2,896 2,662 Total $ — $ 2,896 $ 21,719 $ 24,615 $ 27,861 |
Schedule of Unobservable Inputs Used for Level Three Fair Value Measurements of Financial Instruments on Recurring Basis | Quantitative information regarding significant unobservable inputs used for recurring Level 3 fair value measurements of financial instruments carried at fair value as of March 31, 2021 and December 31, 2020 are as follows: Fair Value at Valuation Technique Unobservable Input(s) Range (Weighted average) March 31, 2021 (in millions) March 31, 2021 Assets Asset-backed securities $ 1,430 Broker-quoted Offered quotes 48.67% - 115.83% 92.15% Asset-backed securities 163 Third-Party Valuation Offered quotes 0.00% - 104.73% 78.18% Commercial mortgage-backed securities 25 Broker-quoted Offered quotes 128.77% - 128.77% 128.77% Corporates 385 Broker-quoted Offered quotes 91.56% - 110.78% 102.28% Corporates 17 Discounted Cash Flow Discount Rate 44.00% - 100.00% 79.02% Corporates 844 Third-Party Valuation Offered quotes 85.23% - 122.88% 105.67% Municipals 41 Third-Party Valuation Offered quotes 126.62% - 126.62% 126.62% Residential mortgage-backed securities 487 Broker-quoted Offered quotes 0.00% - 115.50% 115.50% Foreign governments 17 Third-Party Valuation Offered quotes 107.19% - 109.61% 107.95% Preferred securities 1 Income-Approach Yield —% Equity securities 2 Black Scholes model Risk Free Rate 0.50% - 0.50% (0.50%) Strike Price $1.50 - $1.50 ($1.50) Volatility 109.66% - 109.66% (109.66%) Dividend Yield 0.00% - 0.00% (0.00%) Equity securities 2 Broker Quoted Offered quotes Equity securities 4 Discounted Cash Flow Discount rate 10.60% - 10.60% (10.60%) Market Comparable Company Analysis EBITDA multiple 6.6 x - 6.6 x (6.6 x ) Other long-term assets: Available-for-sale embedded derivative 29 Third-Party Valuation Market value of fund 100.00% Credit Linked Note 19 Broker-quoted Offered quotes 100.00% Total financial assets at fair value $ 3,466 Liabilities Future policy benefits $ 4 Discounted cash flow Non-performance spread 0.50% Derivatives: FIA embedded derivatives, included in contractholder funds 3,293 Discounted cash flow Market value of option 0.00% - 70.30% 3.76% Swap rates 0.01% - 2.41% 1.21% Mortality multiplier 100.00% - 100.00% 100.00% Surrender rates 0.25% - 55.00% 5.32% Partial withdrawals 2.00% - 3.50% 2.60% Non-performance spread 0.75% - 0.75% 0.75% Option cost 0.05% - 15.94% 2.26% Total financial liabilities at fair value $ 3,297 Fair Value at Valuation Technique Unobservable Input(s) Range (Weighted average) December 31, 2020 (in millions) December 31, 2020 Assets Asset-backed securities $ 1,175 Broker-quoted Offered quotes 85% - 126.15% 103.96% Asset-backed securities 175 Third-Party Valuation Offered quotes 0.00% - 107.25% 79.87% Commercial mortgage-backed securities 26 Broker-quoted Offered quotes 131.59% - 131.59% 131.59% Corporates 388 Broker-quoted Offered quotes 75.20% - 114.68% 103.36% Corporates 901 Third-Party Valuation Offered quotes 88.42% - 125.83% 109.47% Hybrids 4 Third-Party Valuation Offered quotes 112.06% - 112.06% 112.06% Municipals 43 Third-Party Valuation Offered quotes 133.53% - 133.53% 133.53% Residential mortgage-backed securities 483 Broker-quoted Offered quotes 112.58% - 112.58% 112.58% Foreign governments 17 Third-Party Valuation Offered quotes 107.87% - 113.80% 109.72% Equity securities 1 Income-Approach Yield —% Equity securities 1 Black Scholes model Risk Free Rate 0.29% - 0.29% (0.29%) Strike Price $1.50 - $1.50 ($1.50) Volatility 1.00% - 1.00% (1.00%) Dividend Yield 0.00% - 0.00% (0.00%) Equity securities 3 Discounted Cash Flow Discount rate 10.60% - 10.60% (10.60%) Market Comparable Company Analysis EBITDA multiple 6.6x - 6.6x (6.6x) Other long-term assets: Available-for-sale embedded derivative 27 Third-Party Valuation Market value of fund 100.00% Credit Linked Note 23 Broker-quoted Offered quotes 100.00% Total financial assets at fair value $ 3,267 Liabilities Future policy benefits 5 Discounted cash flow Non-performance spread 0.00% Risk margin to reflect uncertainty 0.50% Derivatives: FIA embedded derivatives, included in contractholder funds 3,404 Discounted cash flow Market value of option 0.00% - 67.65% 2.25% Treasury rates 0.08% - 1.65% 0.87% Mortality multiplier 100.00% - 100.00% 100.00% Surrender rates 0.25% - 55.00% 5.24% Partial withdrawals 2.00% - 3.50% 2.58% Non-performance spread 0.74% - 0.74% 0.74% Option cost 0.05% - 16.61% 2.25% Total financial liabilities at fair value $ 3,409 |
Changes in Fair Value of Financial Instruments - Assets | The following tables summarize changes to the Company’s financial instruments carried at fair value and classified within Level 3 of the fair value hierarchy for the three months ended March 31, 2021 and 2020. This summary excludes any impact of amortization of VOBA, DAC and DSI. The gains and losses below may include changes in fair value due in part to observable inputs that are a component of the valuation methodology. Three months ended March 31, 2021 (in millions) Balance at Beginning Total Gains (Losses) Purchases Sales Settlements Net transfer In (Out) of Balance at End of Change in Unrealized Incl in OCI Included in Included in Assets Fixed maturity securities available-for-sale: Asset-backed securities $ 1,350 $ — $ (23) $ 358 $ — $ (92) $ — $ 1,593 $ (4) Commercial mortgage-backed securities 26 — (1) — — — — 25 1 Corporates 1,289 6 (39) 40 (5) (31) (14) 1,246 19 Hybrids 4 — — — — (4) — — — Municipals 43 — (2) — — — — 41 4 Residential mortgage-backed securities 483 — 12 5 — (13) — 487 27 Foreign Governments 17 — — — — — — 17 2 Equity and preferred securities 5 1 — 3 — — — 9 — Other long-term assets: Available-for-sale embedded derivative 27 2 — — — — — 29 — Credit linked note 23 — (4) — — — — 19 — Total assets at Level 3 fair value $ 3,267 $ 9 $ (57) $ 406 $ (5) $ (140) $ (14) $ 3,466 $ 49 Liabilities Future policy benefits $ 5 $ — $ — $ — $ — $ (1) $ — $ 4 $ — FIA embedded derivatives, included in contractholder funds 3,404 (111) — — — — — 3,293 — Total liabilities at Level 3 fair value $ 3,409 $ (111) $ — $ — $ — $ (1) $ — $ 3,297 $ — (a) The net transfers out of Level 3 during the three months ended March 31, 2021 were exclusively to Level 2. Three months ended March 31, 2020 (in millions) Balance at Beginning Total Gains (Losses) Purchases Sales Settlements Net transfer In (Out) of Balance at End of Change in Unrealized Incl in OCI Included in Included in Assets Fixed maturity securities available-for-sale: Corporates $ 17 $ (3) $ — $ — $ — $ — $ — $ 14 $ — Equity securities 1 — — — — — — 1 — Other invested assets: Other long-term investment 120 (61) — — — — (59) — — Total assets at Level 3 fair value $ 138 $ (64) $ — $ — $ — $ — $ (59) $ 15 $ — |
Changes in Fair Value of Financial Instruments - Liabilities | The following tables summarize changes to the Company’s financial instruments carried at fair value and classified within Level 3 of the fair value hierarchy for the three months ended March 31, 2021 and 2020. This summary excludes any impact of amortization of VOBA, DAC and DSI. The gains and losses below may include changes in fair value due in part to observable inputs that are a component of the valuation methodology. Three months ended March 31, 2021 (in millions) Balance at Beginning Total Gains (Losses) Purchases Sales Settlements Net transfer In (Out) of Balance at End of Change in Unrealized Incl in OCI Included in Included in Assets Fixed maturity securities available-for-sale: Asset-backed securities $ 1,350 $ — $ (23) $ 358 $ — $ (92) $ — $ 1,593 $ (4) Commercial mortgage-backed securities 26 — (1) — — — — 25 1 Corporates 1,289 6 (39) 40 (5) (31) (14) 1,246 19 Hybrids 4 — — — — (4) — — — Municipals 43 — (2) — — — — 41 4 Residential mortgage-backed securities 483 — 12 5 — (13) — 487 27 Foreign Governments 17 — — — — — — 17 2 Equity and preferred securities 5 1 — 3 — — — 9 — Other long-term assets: Available-for-sale embedded derivative 27 2 — — — — — 29 — Credit linked note 23 — (4) — — — — 19 — Total assets at Level 3 fair value $ 3,267 $ 9 $ (57) $ 406 $ (5) $ (140) $ (14) $ 3,466 $ 49 Liabilities Future policy benefits $ 5 $ — $ — $ — $ — $ (1) $ — $ 4 $ — FIA embedded derivatives, included in contractholder funds 3,404 (111) — — — — — 3,293 — Total liabilities at Level 3 fair value $ 3,409 $ (111) $ — $ — $ — $ (1) $ — $ 3,297 $ — (a) The net transfers out of Level 3 during the three months ended March 31, 2021 were exclusively to Level 2. Three months ended March 31, 2020 (in millions) Balance at Beginning Total Gains (Losses) Purchases Sales Settlements Net transfer In (Out) of Balance at End of Change in Unrealized Incl in OCI Included in Included in Assets Fixed maturity securities available-for-sale: Corporates $ 17 $ (3) $ — $ — $ — $ — $ — $ 14 $ — Equity securities 1 — — — — — — 1 — Other invested assets: Other long-term investment 120 (61) — — — — (59) — — Total assets at Level 3 fair value $ 138 $ (64) $ — $ — $ — $ — $ (59) $ 15 $ — |
Schedule of Net Asset Value | The following table includes assets that have not been classified in the fair value hierarchy as the value of these investments are measured using the equity method of accounting or the net asset value ("NAV") per share practical expedient (in millions): Carrying Value After Measurement March 31, 2021 December 31, 2020 Investments in unconsolidated affiliates (equity method of accounting) $ 143 $ 146 Investments in unconsolidated affiliates (NAV) $ 1,281 1,148 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Consolidated Investments | The Company’s consolidated investments at March 31, 2021 and December 31, 2020 are summarized as follows (in millions): March 31, 2021 Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Carrying Value Available-for-sale securities Asset-backed securities $ 6,358 $ — $ 339 $ (35) $ 6,662 $ 6,662 Commercial mortgage-backed securities 2,514 (1) 382 (5) 2,890 2,890 Corporates 14,178 (3) 633 (344) 14,464 14,464 Hybrids 892 — 60 — 952 952 Municipals 1,399 — 43 (25) 1,417 1,417 Residential mortgage-backed securities 774 (3) 37 (1) 807 807 U.S. Government 333 — 6 — 339 339 Foreign Governments 186 — 4 (3) 187 187 Total available-for-sale securities $ 26,634 $ (7) $ 1,504 $ (413) $ 27,718 $ 27,718 December 31, 2020 Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Carrying Value Available-for-sale securities Asset-backed securities $ 5,941 $ — $ 343 $ (18) $ 6,266 $ 6,266 Commercial mortgage-backed/asset-backed securities $ 2,490 $ — $ 342 $ (3) $ 2,829 $ 2,829 Corporates 13,582 (16) 1,184 (15) 14,735 14,735 Hybrids 914 — 80 — 994 994 Municipals 1,333 — 72 (2) 1,403 1,403 Residential mortgage-backed securities 806 (3) 23 (1) 825 825 U.S. Government 332 — 10 — 342 342 Foreign Governments 179 — 14 — 193 193 Total available-for-sale securities $ 25,577 $ (19) $ 2,068 $ (39) $ 27,587 $ 27,587 |
Investments Classified by Contractual Maturity Date | The amortized cost and fair value of fixed maturity available-for-sale securities by contractual maturities, as applicable, are shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. March 31, 2021 (in millions) Amortized Cost Fair Value Corporates, Non-structured Hybrids, Municipal and Government securities: Due in one year or less $ 531 $ 536 Due after one year through five years 1,919 2,029 Due after five years through ten years 2,260 2,346 Due after ten years 12,252 12,418 Subtotal 16,962 17,329 Other securities which provide for periodic payments: Asset-backed securities 6,358 6,662 Commercial mortgage-backed securities 2,514 2,890 Structured hybrids 26 30 Residential mortgage-backed securities 774 807 Subtotal 9,672 10,389 Total fixed maturity available-for-sale securities $ 26,634 $ 27,718 |
Activity in Allowance for Credit Loses of Available-for-sale Securities Aggregated by Investment Category | The activity in the allowance for expected credit losses of available-for-sale securities aggregated by investment category were as follows for the three months ended March 31, 2021 (in millions): Three Months Ended March 31, 2021 Additions Reductions Balance at Beginning of Period For credit losses on securities for which losses were not previously recorded For initial credit losses on purchased securities accounted for as PCD financial assets (1) (Additions) reductions in allowance recorded on previously impaired securities For securities sold during the period For securities intended/required to be sold prior to recovery of amortized cost basis Write-offs charged against the allowance Recoveries of amounts previously written off Balance at End of Period Available-for-sale securities Commercial mortgage-backed securities $ — $ (1) $ — $ — $ — $ — $ — — $ (1) Corporates (16) — — 7 — — 3 3 (3) Residential mortgage-backed securities (3) — — — — — — — (3) Total available-for-sale securities $ (19) $ (1) $ — $ 7 $ — $ — $ 3 $ 3 $ (7) (1) Purchased credit deteriorated financial assets ("PCD") |
Fair Value and Gross Unrealized Losses of Available-for-sale Securities | The fair value and gross unrealized losses of available-for-sale securities, excluding securities in an unrealized loss position with an allowance for expected credit loss, aggregated by investment category and duration of fair value below amortized cost as of March 31, 2021, and December 31, 2020 were as follows (dollars in millions): March 31, 2021 Less than 12 months 12 months or longer Total Fair Value Gross Unrealized Fair Value Gross Unrealized Fair Value Gross Unrealized Available-for-sale securities Asset-backed securities $ 1,095 $ (35) $ — $ — $ 1,095 $ (35) Commercial mortgage-backed securities 250 (3) — — 250 (3) Corporates 5,634 (344) 1 — 5,635 (344) Hybrids 31 — — — 31 — Municipals 686 (25) — — 686 (25) Residential mortgage-backed securities 37 (1) — — 37 (1) U.S. Government 42 — — — 42 — Foreign Government 98 (3) 5 — 103 (3) Total available-for-sale securities $ 7,873 $ (411) $ 6 $ — $ 7,879 $ (411) Total number of available-for-sale securities in an unrealized loss position less than twelve months 726 Total number of available-for-sale securities in an unrealized loss position twelve months or longer 2 Total number of available-for-sale securities in an unrealized loss position 728 December 31, 2020 Less than 12 months 12 months or longer Total Fair Value Gross Unrealized Fair Value Gross Unrealized Fair Value Gross Unrealized Available-for-sale securities Asset-backed securities $ 477 $ (18) $ — $ — $ 477 $ (18) Commercial mortgage-backed securities 51 (3) — — 51 (3) Corporates $ 865 $ (15) $ 36 $ — $ 901 $ (15) Hybrids 1 — — — 1 — Municipals 115 (2) — — 115 (2) Residential mortgage-backed securities 30 (1) — — 30 (1) U.S. Government 11 — — — 11 — Foreign Government — — — — — — Total available-for-sale securities $ 1,550 $ (39) $ 36 $ — $ 1,586 $ (39) Total number of available-for-sale securities in an unrealized loss position less than twelve months 222 Total number of available-for-sale securities in an unrealized loss position twelve months or longer 11 Total number of available-for-sale securities in an unrealized loss position 233 |
Schedule of Distribution of CMLs, Gross Valuation by Property Type and Geographic Region | The distribution of CMLs, gross of valuation allowances, by property type and geographic region is reflected in the following tables (dollars in millions): March 31, 2021 Gross Carrying Value % of Total Property Type: Hotel $ 19 2 % Industrial - General 337 27 % Industrial - Warehouse 19 2 % Multifamily 314 26 % Office 222 18 % Retail 134 11 % Other 141 12 % Student Housing 25 2 % Total commercial mortgage loans, gross of valuation allowance $ 1,211 100 % Allowance for expected credit loss (5) Total commercial mortgage loans $ 1,206 U.S. Region: East North Central $ 65 5 % East South Central 80 7 % Middle Atlantic 180 15 % Mountain 89 7 % New England 82 7 % Pacific 418 34 % South Atlantic 226 19 % West North Central 13 1 % West South Central 58 5 % Total commercial mortgage loans, gross of valuation allowance $ 1,211 100 % Allowance for expected credit loss (5) Total commercial mortgage loans $ 1,206 December 31, 2020 Gross Carrying Value % of Total Property Type: Hotel $ 19 2 % Industrial - General 302 33 % Industrial - Warehouse 12 1 % Multifamily 165 18 % Office 140 15 % Retail 142 17 % Other 125 14 % Total commercial mortgage loans, gross of valuation allowance $ 905 100 % Allowance for expected credit loss (2) Total commercial mortgage loans $ 903 U.S. Region: East North Central $ 61 7 % East South Central 80 9 % Middle Atlantic 100 11 % Mountain 48 5 % New England 79 9 % Pacific 333 37 % South Atlantic 133 15 % West North Central 13 1 % West South Central 58 6 % Total commercial mortgage loans, gross of valuation allowance $ 905 100 % Allowance for expected credit loss (2) Total commercial mortgage loans $ 903 |
Schedule of Investment in Mortgage Loans by Loan to Value and Debt Service Coverage Ratios | The following table presents the recorded investment in CMLs by LTV and DSC ratio categories and estimated fair value by the indicated loan-to-value ratios at March 31, 2021 (dollars in millions) : Debt-Service Coverage Ratios Total Amount % of Total Estimated Fair Value % of Total >1.25 1.00 - 1.25 <1.00 March 31, 2021 LTV Ratios: Less than 50% $ 543 $ 17 $ 9 $ 569 48 % $ 584 49 % 50% to 60% 270 — — 270 22 % 271 23 % 60% to 75% 269 103 — 372 30 % 342 28 % Commercial mortgage loans $ 1,082 $ 120 $ 9 $ 1,211 100 % $ 1,197 100 % December 31, 2020 LTV Ratios: Less than 50% $ 520 $ 18 $ — $ 538 60 % $ 557 60 % 50% to 60% 237 9 — 246 27 % 251 27 % 60% to 75% 121 — — 121 13 % 119 13 % Commercial mortgage loans $ 878 $ 27 $ — $ 905 100 % $ 927 100 % |
Schedule of Residential Mortgage Loans by State | The distribution of RMLs by state with highest-to-lowest concentration are reflected in the following tables (dollars in millions): March 31, 2021 U.S. State: Unpaid Principal Balance % of Total California $ 182 15 % Florida 154 13 % New Jersey 101 9 % All Other States (1) 747 63 % Total mortgage loans $ 1,184 100 % (1) The individual concentration of each state is less than 9% as of March 31, 2021. December 31, 2020 U.S. State: Unpaid Principal Balance % of Total California $ 164 15 % Florida 188 16 % New Jersey 96 8 % All other states 704 61 % Total mortgage loans $ 1,152 100 % (1) The individual concentration of each state is less than 8% as of December 31, 2020. |
Schedule of Loans with Credit Quality Indicators, Performing or Nonperforming | The credit quality of RMLs as at March 31, 2021, was as follows (dollars in millions): March 31, 2021 December 31, 2020 Performance indicators: Carrying Value % of Total Carrying Value % of Total Performing $ 1,106 92 % $ 1,059 91 % Non-performing 93 8 % 106 9 % Total residential mortgage loans, gross of valuation allowance $ 1,199 100 % $ 1,165 100 % Allowance for expected loan loss (31) — % (37) — % Total residential mortgage loans $ 1,168 100 % $ 1,128 100 % |
Loans Segregated by Risk Rating Exposure | Loans segregated by risk rating exposure as of March 31, 2021, were as follows (in millions): March 31, 2021 Amortized Cost by Origination Year 2021 2020 2019 2018 2017 Prior Total Residential mortgages Current (less than 30 days past due) $ 144 $ 515 $ 292 $ 129 $ — $ — $ 1,080 30-89 days past due — 14 10 1 — — 25 Over 90 days past due — 36 50 3 — — 89 Total residential mortgages $ 144 $ 565 $ 352 $ 133 $ — $ — $ 1,194 Commercial mortgages Current (less than 30 days past due) $ 308 $ 542 $ — $ 6 $ — $ 355 $ 1,211 30-89 days past due — — — — — — — Over 90 days past due — — — — — — — Total commercial mortgage $ 308 $ 542 $ — $ 6 $ — $ 355 $ 1,211 December 31, 2020 Amortized Cost by Origination Year 2020 2019 2018 2017 2016 Prior Total Residential mortgages Current (less than 30 days past due) $ 311 $ 545 $ 68 $ 42 $ 62 $ 2 $ 1,030 30-89 days past due 2 22 2 — — — 26 Over 90 days past due 26 74 3 — — — 103 Total residential mortgages $ 339 $ 641 $ 73 $ 42 $ 62 $ 2 $ 1,159 Commercial mortgages Current (less than 30 days past due) $ 542 $ — $ 6 $ — $ 11 $ 346 $ 905 30-89 days past due — — — — — — — Over 90 days past due — — — — — — — Total commercial mortgage $ 542 $ — $ 6 $ — $ 11 $ 346 $ 905 March 31, 2021 Amortized Cost by Origination Year 2021 2020 2019 2018 2017 Prior Total Commercial mortgages LTV Less than 50% $ 15 $ 228 $ — $ 6 $ — $ 320 $ 569 50% to 60% 43 192 — — — 35 270 60% to 75% 250 122 — — — — 372 Total commercial mortgages $ 308 $ 542 $ — $ 6 $ — $ 355 $ 1,211 Commercial mortgages DSCR Greater than 1.25x $ 205 $ 542 $ — $ 6 $ — $ 328 $ 1,081 1.00x - 1.25x 103 — — — — 18 121 Less than 1.00x — — — — — 9 9 Total commercial mortgages $ 308 $ 542 $ — $ 6 $ — $ 355 $ 1,211 December 31, 2020 Amortized Cost by Origination Year 2020 2019 2018 2017 2016 Prior Total Commercial mortgages LTV Less than 50% $ 228 $ — $ 6 $ — $ — $ 303 $ 537 50% to 60% 192 — — — 11 43 246 60% to 75% 122 — — — — — 122 Total commercial mortgages $ 542 $ — $ 6 $ — $ 11 $ 346 $ 905 Commercial mortgages DSCR Greater than 1.25x $ 542 $ — $ 6 $ — $ 11 $ 319 $ 878 1.00x - 1.25x — — — — — 27 27 Less than 1.00x — — — — — — — Total commercial mortgages $ 542 $ — $ 6 $ — $ 11 $ 346 $ 905 |
Financing Receivable, Nonaccrual | Non-accrual loans by amortized cost as of March 31, 2021 and December 31, 2020, was as follows: Amortized cost of loans on non-accrual March 31, 2021 December 31, 2020 Residential mortgage: $ 90 $ 99 Commercial mortgage: — — Total non-accrual loans $ 90 $ 99 |
Allowance for Expected Credit Losses on Loans | Changes in our allowance for expected credit losses on mortgage loans are recognized in Recognized gains and losses, net in the accompanying unaudited Condensed Consolidated Statements of Earnings. March 31, 2021 Residential Mortgage Commercial Mortgage Total Balance, December 31, 2020 37 2 39 (Reversal of) provision for loan losses $ (6) $ 3 $ (3) Balance, March 31, 2021 $ 31 $ 5 $ 36 |
Schedule of Sources of Net Investment Income Reported | The major sources of Interest and investment income reported on the accompanying unaudited Condensed Consolidated Statements of Earnings were as follows (in millions): Three months ended March 31, 2021 March 31, 2020 Fixed maturity securities, available-for-sale $ 307 $ 17 Equity securities 5 3 Preferred securities 14 6 Mortgage loans 23 — Invested cash and short-term investments — 7 Limited partnerships 80 — Tax deferred property exchange income 4 16 Other investments 8 4 Gross investment income 441 53 Investment expense (39) — Interest and investment income $ 402 $ 53 Recognized Gains and Losses, net Details underlying Recognized gains and losses, net reported on the accompanying unaudited Condensed Consolidated Statements of Earnings were as follows (in millions): Three months ended March 31, 2021 March 31, 2020 Net realized gains on fixed maturity available-for-sale securities $ 40 $ 3 Net realized/unrealized gains (losses) on equity securities (2) (46) (205) Net realized/unrealized gains (losses) on preferred securities (3) (10) (105) Realized losses on other invested assets (3) (9) Change in allowance for expected credit losses 10 (4) Derivatives and embedded derivatives: Realized gains on certain derivative instruments 60 — Unrealized losses on certain derivative instruments (35) — Change in fair value of reinsurance related embedded derivatives (1) 27 — Change in fair value of other derivatives and embedded derivatives — — Realized gains on derivatives and embedded derivatives 52 — Recognized gains and (losses), net $ 43 $ (320) (1) Change in fair value of reinsurance related embedded derivatives is due to held for sale unaffiliated third party business under the fair value option election, and activity related to the FGL Insurance and Kubera reinsurance treaty. (2) Includes net valuation losses of $(46) million for the three months ended March 31, 2021, and net valuation losses of $(205) million for the three months ended March 31, 2020. |
Proceeds from Sale of Fixed Maturity Available-for-sale Securities | The proceeds from the sale of fixed-maturity available for-sale-securities and the gross gains and losses associated with those transactions were as follows (in millions): Three months ended March 31, 2021 March 31, 2020 Proceeds $ 424 $ 63 Gross gains 32 12 Gross losses (8) (1) |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The carrying amounts of derivative instruments, including derivative instruments embedded in FIA contracts, as of March 31, 2021 is as follows (in millions): March 31, 2021 December 31, 2020 Assets: Derivative investments: Call options $ 542 $ 548 Futures contracts 1 — Other long-term investments: Other embedded derivatives 27 27 Funds withheld: Embedded derivatives 1 — $ 571 $ 575 Liabilities: Contractholder funds: FIA embedded derivative $ 3,293 $ 3,404 Other liabilities: Reinsurance related embedded derivative 75 101 $ 3,368 $ 3,505 |
Change in Fair Value of Derivative Instruments | The change in fair value of derivative instruments included in the accompanying unaudited Condensed Consolidated Statements of Earnings is as follows (in millions): Three Months Ended March 31, 2021 Net investment gains (losses): Call options $ 22 Foreign currency forward 4 Reinsurance related embedded derivatives 27 Total net investment gains (losses) $ 53 Benefits and other changes in policy reserves: FIA embedded derivatives $ (111) |
Exposure to Credit Loss on Call Options Held | Information regarding our exposure to credit loss on the call options we hold as of March 31, 2021, is presented in the following table (in millions): March 31, 2021 Counterparty Credit Rating Notional Fair Value Collateral Net Credit Risk Merrill Lynch AA-/*/A+ $ 1,716 $ 91 $ 51 $ 40 Morgan Stanley */Aa3/A+ 1,612 65 70 — Barclay's Bank A+/A1/A 5,294 105 109 — Canadian Imperial Bank of Commerce AA/Aa2/A+ 2,166 79 79 — Wells Fargo A+/A2/BBB+ 2,537 101 100 1 Goldman Sachs A/A2/BBB+ 268 12 13 — Credit Suisse A/Aa3/A+ 2,013 57 59 — Truist A+/A2/A 1,024 32 32 — Total $ 16,630 $ 542 $ 513 $ 41 (1) An * represents credit ratings that were not available. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Unfunded Commitments | A summary of unfunded commitments by invested asset class as of March 31, 2021 is included below (in millions): March 31, 2021 Asset Type Other invested assets $ 584 Fixed maturity securities, available-for-sale 496 Other assets 83 Commercial mortgage loans 46 Residential mortgage loans 4 Total $ 1,213 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Summarized financial information concerning our reportable segments is shown in the following tables. On June 1, 2020, we completed our acquisition of F&G. As a result we have a new segment as of and for the three months ended March 31, 2021, F&G, which contains our fixed annuity and life insurance businesses. As of and for the three months ended March 31, 2021: Title F&G Corporate and Other Total (In millions) Title premiums $ 1,804 $ — $ — $ 1,804 Other revenues 745 64 42 851 Revenues from external customers 2,549 64 42 2,655 Interest and investment income, including recognized gains and losses (30) 475 — 445 Total revenues 2,519 539 42 3,100 Depreciation and amortization 33 144 6 183 Interest expense — 8 20 28 Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated affiliates 439 356 (38) 757 Income tax expense (benefit) 103 72 (9) 166 Earnings (loss) before equity in earnings (loss) of unconsolidated affiliates 336 284 (29) 591 Equity in earnings (loss) of unconsolidated affiliates 8 — 5 13 Net earnings (loss) from continuing operations $ 344 $ 284 $ (24) $ 604 Assets $ 9,389 $ 40,614 $ 1,486 $ 51,489 Goodwill 2,481 1,751 266 4,498 As of and for the three months ended March 31, 2020: Title Corporate and Other Total (In millions) Title premiums $ 1,278 $ — $ 1,278 Other revenues 610 (9) 601 Revenues from external customers 1,888 (9) 1,879 Interest and investment income, including recognized gains and losses (265) (2) (267) Total revenues 1,623 (11) 1,612 Depreciation and amortization 37 6 43 Interest expense — 12 12 Loss before income taxes and equity in earnings of unconsolidated affiliates (53) (33) (86) Income tax benefit (19) (9) (28) Loss before equity in earnings of unconsolidated affiliates (34) (24) (58) Equity in earnings of unconsolidated affiliates 1 — 1 Net loss $ (33) $ (24) $ (57) Assets $ 8,728 $ 1,476 $ 10,204 Goodwill 2,460 266 2,726 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow information | The following supplemental cash flow information is provided with respect to certain cash payment and non-cash investing and financing activities. Three months ended March 31, 2021 2020 Cash paid for: Interest $ 29 $ 22 Income taxes 7 4 Deferred sales inducements 21 — Non-cash investing and financing activities: Change in proceeds of sales of investments available for sale receivable in period $ (9) $ — Change in purchases of investments available for sale payable in period 164 — Change in treasury stock purchases payable in period — 5 Lease liabilities recognized in exchange for lease right-of-use assets 5 8 Remeasurement of lease liabilities 13 22 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Disaggregation of Revenue | Our revenue consists of: Three months ended March 31, 2021 2020 Revenue Stream Income Statement Classification Segment Total Revenue Revenue from insurance contracts: (in millions) Direct title insurance premiums Direct title insurance premiums Title $ 746 $ 546 Agency title insurance premiums Agency title insurance premiums Title 1,058 732 Life insurance premiums, insurance and investment product fees, and other Escrow, title-related and other fees F&G 64 — Home warranty Escrow, title-related and other fees Title 39 43 Total revenue from insurance contracts 1,907 1,321 Revenue from contracts with customers: Escrow fees Escrow, title-related and other fees Title 324 221 Other title-related fees and income Escrow, title-related and other fees Title 205 159 ServiceLink, excluding title premiums, escrow fees, and subservicing fees Escrow, title-related and other fees Title 90 106 Real estate technology Escrow, title-related and other fees Corporate and other 32 27 Real estate brokerage Escrow, title-related and other fees Corporate and other — 6 Other Escrow, title-related and other fees Corporate and other 10 (42) Total revenue from contracts with customers 661 477 Other revenue: Loan subservicing revenue Escrow, title-related and other fees Title 87 81 Interest and investment income Interest and investment income Various 402 53 Recognized gains and losses, net Recognized gains and losses, net Various 43 (320) Total revenues Total revenues $ 3,100 $ 1,612 | |
Information about Trade Receivables and Deferred Revenue | The following table provides information about trade receivables and deferred revenue: March 31, 2021 December 31, 2020 (In millions) Trade receivables $ 390 $ 404 Deferred revenue (contract liabilities) 116 117 | |
Revenue from contract with customer | $ 661 | $ 477 |
Value of Business Acquired, D_2
Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Changes Intangible Assets, VOBA and DAC DSI | A summary of the changes in the carrying amounts of the Company's VOBA, DAC and DSI intangible assets are as follows (in millions): VOBA DAC DSI Total Balance at December 31, 2020 $ 1,466 $ 222 $ 36 $ 1,724 Deferrals — 133 21 154 Amortization (132) (8) (8) (148) Interest 8 2 — 10 Unlocking 1 — — 1 Adjustment for net unrealized investment (gains) losses 132 (5) — 127 Balance at March 31, 2021 $ 1,475 $ 344 $ 49 $ 1,868 |
Estimated Amortization Expense for VOBA in Future Fiscal Periods | For the inforce liabilities as of March 31, 2021, the estimated amortization expense for VOBA in future fiscal periods is as follows (in millions): Estimated Amortization Expense Fiscal Year 2021 59 2022 190 2023 185 2024 172 2025 168 Thereafter 853 |
F&G Reinsurance (Tables)
F&G Reinsurance (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Reinsurance Disclosures [Abstract] | |
Effect of Reinsurance on Premiums Earned, Benefits Incurred and Reserve Changes | The effect of reinsurance on net premiums earned and net benefits incurred (benefits paid and reserve changes) for the three months ended March 31, 2021 were as follows (in millions): Three months ended March 31, 2021 Net Premiums Earned Net Benefits Incurred Direct $ 44 $ 293 Ceded (33) (319) Net $ 11 $ (26) |
Basis of Financial Statements -
Basis of Financial Statements - Recent Developments (Details) - Paysafe Limited - Subscription Agreements with Paysafe Limited and Foley Trasimene Acquisition Corp. II - USD ($) $ / shares in Units, $ in Millions | Mar. 31, 2021 | Dec. 07, 2020 |
Business Acquisition [Line Items] | ||
Subscription agreements, investment | $ 500 | |
Subscription agreement, stock purchase, par value (in usd per share) | $ 0.001 | |
Subscription agreement, stock purchase, share price (in usd per share) | $ 10 | |
Subscriptions funded, shares received (in shares) | 50,000,000 | |
Subscription agreement, ownership interest after purchase, percent | 7.00% | |
Subscriber fee, percentage | 1.60% |
Basis of Financial Statements_2
Basis of Financial Statements - Income Tax (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Income tax expense (benefit) | $ 166 | $ (28) |
Income tax expense as percentage of earnings before income taxes, percent | 22.00% | 33.00% |
Tax benefit related to 2017 amended return | $ 7 |
Basis of Financial Statements_3
Basis of Financial Statements - Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Antidilutive securities excluded from computation of EPS, less than, amount (shares) | 1,000,000 | 3,000,000 |
Summary of Reserve for Title _3
Summary of Reserve for Title Claim Losses (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Loss Contingencies [Line Items] | ||
Change in insurance recoverable | $ 38 | $ 0 |
Title | ||
Loss Contingencies [Line Items] | ||
Beginning balance | 1,623 | 1,509 |
Change in insurance recoverable | 25 | (1) |
Claim loss provision related to: | ||
Current year | 81 | 58 |
Prior years | 0 | 0 |
Total title claim loss provision | 81 | 58 |
Claims paid, net of recoupments related to: | ||
Current year | 0 | 0 |
Prior years | (46) | (48) |
Total title claims paid, net of recoupments | (46) | (48) |
Ending balance of claim loss reserve for title insurance | $ 1,683 | $ 1,518 |
Provision for title insurance claim losses as a percentage of title insurance premiums | 4.50% | 4.50% |
Summary of Reserve for Title _4
Summary of Reserve for Title Claim Losses - Narrative (Details) - Pending Litigation - USD ($) $ in Millions | Nov. 02, 2020 | Oct. 23, 2020 | Oct. 01, 2020 | Sep. 03, 2020 | Jul. 07, 2020 | Jun. 29, 2020 | May 29, 2020 | Mar. 16, 2020 | Mar. 06, 2020 | Dec. 13, 2019 |
Kim Funding, LLC, Kim H. Peterson, Joseph J. Cohen, and ABC Funding Strategies, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 250 | |||||||||
Wakefield Capital, LLC, Wakefield Investments, LLC, 2Budz Holding, LLC, Doug and Kristine Heidrich, and Jeff and Heidi Orr v. Chicago Title Co. and Chicago Title Ins. Co. | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 7 | |||||||||
Randolph L. Levin, et al., v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, Betty Elixman, et al | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 38 | |||||||||
Mark Atherton, et al., v. Chicago Title Co. and Chicago Title Ins. Co. | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 30 | |||||||||
Susan Heller Fenley Separate Property Trust, Susan Heller Fenley Inherited Roth IRA, Shelley Lynn Tarditi Trust and ROJ, LLC v. Chicago Title Co., Chicago Title Ins. Co. et al | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 6 | |||||||||
Yuan Yu and Polly Yu v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 1 | |||||||||
Banc of California, National Association v. Laurie Peterson | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 35 | |||||||||
Laurie Peterson v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 250 | |||||||||
CalPrivate Bank v. Kim H. Peterson Trustee of the Peterson Family Trust dated April 14 1992 | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 12 | |||||||||
Kim H. Peterson Trustee of the Peterson Family Trust dated April 14 1992 v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 250 | |||||||||
Ovation Fin. Holdings 2 LLC, Ovation Fund Mgmt. II, LLC, Banc of California, N.A. v. Chicago Title Ins. Co., and plaintiffs | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 75 | |||||||||
CalPrivate Bank v. Chicago Title Co. and Chicago Title Ins. Co. | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 12 | |||||||||
DH Claims LLC v. Chicago Title Co., Chicago Title Ins. Co., and Della Ducharme | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Plaintiffs claim losses amount | $ 2 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Carrying Amounts of Assets and Liabilities at Estimated Fair Value Measured on a Recurring Basis (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Fixed maturity securities, available for sale | $ 27,718 | $ 27,587 |
Derivative investments | 542 | 548 |
Total financial assets at fair value | 3,466 | 3,267 |
Level 1 | ||
Assets | ||
Cash and cash equivalents | 3,026 | 2,719 |
Derivative investments | 1 | 0 |
Short term investments | 105 | 769 |
Total financial assets at fair value | 4,986 | 5,311 |
Liabilities | ||
Fair value of future policy benefits | 0 | 0 |
Derivatives: | ||
Total financial liabilities at fair value | 0 | 0 |
Level 2 | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Derivative investments | 541 | 548 |
Short term investments | 19 | 0 |
Total financial assets at fair value | 25,735 | 25,431 |
Liabilities | ||
Fair value of future policy benefits | 0 | 0 |
Derivatives: | ||
Total financial liabilities at fair value | 79 | 101 |
Level 3 | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Derivative investments | 0 | 0 |
Short term investments | 0 | 0 |
Total financial assets at fair value | 3,466 | 3,267 |
Liabilities | ||
Fair value of future policy benefits | 0 | 5 |
Derivatives: | ||
Total financial liabilities at fair value | 3,297 | 3,409 |
Fair Value | ||
Assets | ||
Cash and cash equivalents | 3,026 | 2,719 |
Derivative investments | 542 | 548 |
Short term investments | 124 | 769 |
Total financial assets at fair value | 34,187 | 34,009 |
Liabilities | ||
Fair value of future policy benefits | 0 | 5 |
Derivatives: | ||
Total financial liabilities at fair value | 3,376 | 3,510 |
Carrying Value | ||
Assets | ||
Cash and cash equivalents | 3,026 | 2,719 |
Derivative investments | 542 | 548 |
Short term investments | 124 | 769 |
Total financial assets at fair value | 34,187 | 34,009 |
Liabilities | ||
Fair value of future policy benefits | 0 | 5 |
Derivatives: | ||
Total financial liabilities at fair value | 3,376 | 3,510 |
FIA embedded derivatives, included in contractholder funds | Level 1 | ||
Derivatives: | ||
Derivative liability | 0 | 0 |
FIA embedded derivatives, included in contractholder funds | Level 2 | ||
Derivatives: | ||
Derivative liability | 0 | 0 |
FIA embedded derivatives, included in contractholder funds | Level 3 | ||
Derivatives: | ||
Derivative liability | 3,293 | 3,404 |
FIA embedded derivatives, included in contractholder funds | Fair Value | ||
Derivatives: | ||
Derivative liability | 3,293 | 3,404 |
FIA embedded derivatives, included in contractholder funds | Carrying Value | ||
Derivatives: | ||
Derivative liability | 3,293 | 3,404 |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Level 1 | ||
Derivatives: | ||
Derivative liability | 0 | 0 |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Level 2 | ||
Derivatives: | ||
Derivative liability | 75 | 101 |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Level 3 | ||
Derivatives: | ||
Derivative liability | 0 | 0 |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Fair Value | ||
Derivatives: | ||
Derivative liability | 75 | 101 |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Carrying Value | ||
Derivatives: | ||
Derivative liability | 75 | 101 |
Subscription agreements | Level 1 | ||
Derivatives: | ||
Derivative liability | 0 | |
Subscription agreements | Level 2 | ||
Derivatives: | ||
Derivative liability | 4 | |
Subscription agreements | Level 3 | ||
Derivatives: | ||
Derivative liability | 0 | |
Subscription agreements | Fair Value | ||
Derivatives: | ||
Derivative liability | 4 | |
Subscription agreements | Carrying Value | ||
Derivatives: | ||
Derivative liability | 4 | |
Preferred shares reimbursement feature embedded derivative | Level 1 | ||
Derivatives: | ||
Derivative liability | 0 | |
Preferred shares reimbursement feature embedded derivative | Level 2 | ||
Derivatives: | ||
Derivative liability | 0 | |
Preferred shares reimbursement feature embedded derivative | Level 3 | ||
Derivatives: | ||
Derivative liability | 4 | |
Preferred shares reimbursement feature embedded derivative | Fair Value | ||
Derivatives: | ||
Derivative liability | 4 | |
Preferred shares reimbursement feature embedded derivative | Carrying Value | ||
Derivatives: | ||
Derivative liability | 4 | |
Asset-backed securities | ||
Assets | ||
Fixed maturity securities, available for sale | 6,662 | 6,266 |
Asset-backed securities | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
Asset-backed securities | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 5,069 | 4,916 |
Asset-backed securities | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 1,593 | 1,350 |
Asset-backed securities | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 6,662 | 6,266 |
Asset-backed securities | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 6,662 | 6,266 |
Commercial mortgage-backed securities | ||
Assets | ||
Fixed maturity securities, available for sale | 2,890 | 2,829 |
Commercial mortgage-backed securities | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
Commercial mortgage-backed securities | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 2,865 | 2,803 |
Commercial mortgage-backed securities | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 25 | 26 |
Commercial mortgage-backed securities | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 2,890 | 2,829 |
Commercial mortgage-backed securities | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 2,890 | 2,829 |
Corporates | ||
Assets | ||
Fixed maturity securities, available for sale | 14,464 | 14,735 |
Corporates | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 36 | 25 |
Corporates | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 13,182 | 13,421 |
Corporates | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 1,246 | 1,289 |
Corporates | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 14,464 | 14,735 |
Corporates | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 14,464 | 14,735 |
Hybrids | ||
Assets | ||
Fixed maturity securities, available for sale | 952 | 994 |
Hybrids | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 161 | 175 |
Hybrids | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 791 | 815 |
Hybrids | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 4 |
Hybrids | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 952 | 994 |
Hybrids | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 952 | 994 |
Municipals | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
Municipals | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 1,376 | 1,360 |
Municipals | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 41 | 43 |
Municipals | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 1,417 | 1,403 |
Municipals | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 1,417 | 1,403 |
Residential mortgage-backed securities | ||
Assets | ||
Fixed maturity securities, available for sale | 807 | 825 |
Residential mortgage-backed securities | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
Residential mortgage-backed securities | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 320 | 342 |
Residential mortgage-backed securities | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 487 | 483 |
Residential mortgage-backed securities | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 807 | 825 |
Residential mortgage-backed securities | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 807 | 825 |
U.S. Government | ||
Assets | ||
Fixed maturity securities, available for sale | 339 | 342 |
U.S. Government | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 339 | 342 |
U.S. Government | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
U.S. Government | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
U.S. Government | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 339 | 342 |
U.S. Government | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 339 | 342 |
Foreign Governments | ||
Assets | ||
Fixed maturity securities, available for sale | 187 | 193 |
Foreign Governments | Level 1 | ||
Assets | ||
Fixed maturity securities, available for sale | 0 | 0 |
Foreign Governments | Level 2 | ||
Assets | ||
Fixed maturity securities, available for sale | 170 | 176 |
Foreign Governments | Level 3 | ||
Assets | ||
Fixed maturity securities, available for sale | 17 | 17 |
Foreign Governments | Fair Value | ||
Assets | ||
Fixed maturity securities, available for sale | 187 | 193 |
Foreign Governments | Carrying Value | ||
Assets | ||
Fixed maturity securities, available for sale | 187 | 193 |
Equity securities | Level 1 | ||
Assets | ||
Equity securities | 838 | 791 |
Equity securities | Level 2 | ||
Assets | ||
Equity securities | 590 | 0 |
Equity securities | Level 3 | ||
Assets | ||
Equity securities | 8 | 5 |
Equity securities | Fair Value | ||
Assets | ||
Equity securities | 1,436 | 796 |
Equity securities | Carrying Value | ||
Assets | ||
Equity securities | 1,436 | 796 |
Preferred securities | ||
Assets | ||
Equity securities | 1,293 | 1,341 |
Preferred securities | Level 1 | ||
Assets | ||
Equity securities | 480 | 490 |
Preferred securities | Level 2 | ||
Assets | ||
Equity securities | 812 | 851 |
Preferred securities | Level 3 | ||
Assets | ||
Equity securities | 1 | 0 |
Preferred securities | Fair Value | ||
Assets | ||
Equity securities | 1,293 | 1,341 |
Preferred securities | Carrying Value | ||
Assets | ||
Equity securities | 1,293 | 1,341 |
Subscription agreements | Level 1 | ||
Assets | ||
Equity securities | 0 | |
Subscription agreements | Level 2 | ||
Assets | ||
Equity securities | 199 | |
Subscription agreements | Level 3 | ||
Assets | ||
Equity securities | 0 | |
Subscription agreements | Fair Value | ||
Assets | ||
Equity securities | 199 | |
Subscription agreements | Carrying Value | ||
Assets | ||
Equity securities | 199 | |
Other long-term investments | Level 1 | ||
Assets | ||
Other long-term investments | 0 | 0 |
Other long-term investments | Level 2 | ||
Assets | ||
Other long-term investments | 0 | 0 |
Other long-term investments | Level 3 | ||
Assets | ||
Other long-term investments | 48 | 50 |
Other long-term investments | Fair Value | ||
Assets | ||
Other long-term investments | 48 | 50 |
Other long-term investments | Carrying Value | ||
Assets | ||
Other long-term investments | $ 48 | $ 50 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Narrative (Detail) | Mar. 31, 2021$ / Contract |
Other invested assets | Income-Approach | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative, strike price | 0 |
Subscription agreements | Level 2 | Measurement Input, Discount for Lack of Marketability | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Forward purchase agreement, measurement input | 0.030 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Quantitative Information of Unobservable Inputs Used for Level Three Fair Value Measurements of Financial Instruments on Recurring Basis (Detail) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 3,466 | $ 3,267 |
Liabilities, fair value | 3,297 | $ 3,409 |
Future policy benefits | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Risk margin to reflect uncertainty | 0.50% | |
Fixed indexed annuities | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Liabilities, fair value | $ 3,293 | $ 3,404 |
Minimum | Discounted cash flow | Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0.1060 | 0.1060 |
Minimum | Fixed indexed annuities | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Non-performance spread | 0.75% | 0.74% |
Market value of option | 0.00% | 0.00% |
Swap rates | 0.01% | 0.08% |
Mortality multiplier | 100.00% | 100.00% |
Surrender rates | 0.25% | 0.25% |
Partial withdrawals | 2.00% | 2.00% |
Option cost | 0.05% | 0.05% |
Maximum | Discounted cash flow | Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0.1060 | 0.1060 |
Maximum | Fixed indexed annuities | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Non-performance spread | 0.75% | 0.74% |
Market value of option | 70.30% | 67.65% |
Swap rates | 2.41% | 1.65% |
Mortality multiplier | 100.00% | 100.00% |
Surrender rates | 55.00% | 55.00% |
Partial withdrawals | 3.50% | 3.50% |
Option cost | 15.94% | 16.61% |
Weighted Average | Discounted cash flow | Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0.1060 | 0.1060 |
Weighted Average | Fixed indexed annuities | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Non-performance spread | 0.75% | 0.74% |
Market value of option | 3.76% | 2.25% |
Swap rates | 1.21% | 0.87% |
Mortality multiplier | 100.00% | 100.00% |
Surrender rates | 5.32% | 5.24% |
Partial withdrawals | 2.60% | 2.58% |
Option cost | 2.26% | 2.25% |
Asset-backed securities | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 1,430 | $ 1,175 |
Asset-backed securities | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 163 | $ 175 |
Asset-backed securities | Minimum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 48.67% | 85.00% |
Asset-backed securities | Minimum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 0.00% | 0.00% |
Asset-backed securities | Maximum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 115.83% | 126.15% |
Asset-backed securities | Maximum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 104.73% | 107.25% |
Asset-backed securities | Weighted Average | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 92.15% | 103.96% |
Asset-backed securities | Weighted Average | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 78.18% | 79.87% |
Commercial mortgage-backed securities | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 25 | $ 26 |
Commercial mortgage-backed securities | Minimum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 128.77% | 131.59% |
Commercial mortgage-backed securities | Maximum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 128.77% | 131.59% |
Commercial mortgage-backed securities | Weighted Average | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 128.77% | 131.59% |
Corporates | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 385 | $ 388 |
Corporates | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | 844 | $ 901 |
Corporates | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 17 | |
Corporates | Minimum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 91.56% | 75.20% |
Corporates | Minimum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 85.23% | 88.42% |
Corporates | Minimum | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Debt securities | 0.4400 | |
Corporates | Maximum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 110.78% | 114.68% |
Corporates | Maximum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 122.88% | 125.83% |
Corporates | Maximum | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Debt securities | 1 | |
Corporates | Weighted Average | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 102.28% | 103.36% |
Corporates | Weighted Average | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 105.67% | 109.47% |
Corporates | Weighted Average | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Debt securities | 0.7902 | |
Municipals | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 41 | $ 43 |
Municipals | Minimum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 126.62% | 133.53% |
Municipals | Maximum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 126.62% | 133.53% |
Municipals | Weighted Average | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 126.62% | 133.53% |
Residential mortgage-backed securities | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 487 | $ 483 |
Residential mortgage-backed securities | Minimum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 0.00% | 112.58% |
Residential mortgage-backed securities | Maximum | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 115.50% | 112.58% |
Residential mortgage-backed securities | Weighted Average | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 115.50% | 112.58% |
Foreign Governments | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 17 | $ 17 |
Foreign Governments | Minimum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 107.19% | 107.87% |
Foreign Governments | Maximum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 109.61% | 113.80% |
Foreign Governments | Weighted Average | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 107.95% | 109.72% |
Equity securities | Minimum | Broker-quoted | EBITDA Multiple | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 6.6 | 6.6 |
Equity securities | Minimum | Black Scholes model | Risk Free Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0.0050 | 0.0029 |
Equity securities | Minimum | Black Scholes model | Strike Price | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 1.50 | 1.50 |
Equity securities | Minimum | Black Scholes model | Volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 1.0966 | 0.0100 |
Equity securities | Minimum | Black Scholes model | Dividend Yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0 | 0 |
Equity securities | Maximum | Broker-quoted | EBITDA Multiple | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 6.6 | 6.6 |
Equity securities | Maximum | Black Scholes model | Risk Free Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0.0050 | 0.0029 |
Equity securities | Maximum | Black Scholes model | Strike Price | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 1.50 | 1.50 |
Equity securities | Maximum | Black Scholes model | Volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 1.0966 | 0.0100 |
Equity securities | Maximum | Black Scholes model | Dividend Yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0 | 0 |
Equity securities | Weighted Average | Broker-quoted | EBITDA Multiple | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 6.6 | 6.6 |
Equity securities | Weighted Average | Black Scholes model | Risk Free Rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0.0050 | 0.0029 |
Equity securities | Weighted Average | Black Scholes model | Strike Price | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 1.50 | 1.50 |
Equity securities | Weighted Average | Black Scholes model | Volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 1.0966 | 0.0100 |
Equity securities | Weighted Average | Black Scholes model | Dividend Yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity securities | 0 | 0 |
Equity securities | Insurance Subsidiary | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 2 | |
Equity securities | Insurance Subsidiary | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | 4 | $ 3 |
Equity securities | Insurance Subsidiary | Income-Approach | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 1 | $ 1 |
Yield | 0.00% | 0.00% |
Equity securities | Insurance Subsidiary | Black Scholes model | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 2 | $ 1 |
Other invested assets | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 27 | |
Market value of fund | 100.00% | |
Other invested assets | Black Scholes model | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 29 | |
Market value of fund | 100.00% | |
Credit Linked Note | Broker-quoted | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 19 | $ 23 |
Offered quotes | 100.00% | 100.00% |
Future policy benefits, nonperformance risk spread | Future policy benefits | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Liabilities, fair value | $ 4 | $ 5 |
Future policy benefits, nonperformance risk spread | Minimum | Future policy benefits | Discounted cash flow | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Non-performance spread | 0.50% | 0.00% |
Hybrids | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Assets, fair value | $ 4 | |
Hybrids | Minimum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 112.06% | |
Hybrids | Maximum | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 112.06% | |
Hybrids | Weighted Average | Third-Party Valuation | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Offered quotes | 112.06% |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Changes to Fair Value of Financial Instruments Level 3 (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | $ 3,267 | $ 138 |
Assets, Total Gains (Losses) Included in Earnings | 9 | (64) |
Assets, Total Gains (Losses) Included in AOCI | (57) | 0 |
Assets, Purchases | 406 | 0 |
Assets, Sales | (5) | 0 |
Assets, Settlements | (140) | 0 |
Assets, Net transfer In (Out) of Level 3 | (14) | (59) |
Balance at End of Period | 3,466 | 15 |
Change in Unrealized Incl in OCI | 49 | 0 |
Liabilities | ||
Balance at Beginning of Period | 3,409 | |
Liabilities, Total Gains (Losses) Included in Earnings | (111) | |
Liabilities, Total Gains (Losses) Included in AOCI | 0 | |
Liabilities, Purchases | 0 | |
Liabilities, Sales | 0 | |
Liabilities, Settlements | 1 | |
Liabilities, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 3,297 | |
Change in Unrealized Incl in OCI | 0 | |
Future policy benefits | ||
Liabilities | ||
Balance at Beginning of Period | 5 | |
Liabilities, Total Gains (Losses) Included in Earnings | 0 | |
Liabilities, Total Gains (Losses) Included in AOCI | 0 | |
Liabilities, Purchases | 0 | |
Liabilities, Sales | 0 | |
Liabilities, Settlements | 1 | |
Liabilities, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 4 | |
Change in Unrealized Incl in OCI | 0 | |
Embedded Derivatives Included In Contractholder Funds | ||
Liabilities | ||
Balance at Beginning of Period | 3,404 | |
Liabilities, Total Gains (Losses) Included in Earnings | (111) | |
Liabilities, Total Gains (Losses) Included in AOCI | 0 | |
Liabilities, Purchases | 0 | |
Liabilities, Sales | 0 | |
Liabilities, Settlements | 0 | |
Liabilities, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 3,293 | |
Change in Unrealized Incl in OCI | 0 | |
Asset-backed securities | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 1,350 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | (23) | |
Assets, Purchases | 358 | |
Assets, Sales | 0 | |
Assets, Settlements | (92) | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 1,593 | |
Change in Unrealized Incl in OCI | (4) | |
Commercial mortgage-backed securities | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 26 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | (1) | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | 0 | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 25 | |
Change in Unrealized Incl in OCI | 1 | |
Corporates | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 1,289 | 17 |
Assets, Total Gains (Losses) Included in Earnings | 6 | (3) |
Assets, Total Gains (Losses) Included in AOCI | (39) | 0 |
Assets, Purchases | 40 | 0 |
Assets, Sales | (5) | 0 |
Assets, Settlements | (31) | 0 |
Assets, Net transfer In (Out) of Level 3 | (14) | 0 |
Balance at End of Period | 1,246 | 14 |
Change in Unrealized Incl in OCI | 19 | 0 |
Hybrids | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 4 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | 0 | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | (4) | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 0 | |
Change in Unrealized Incl in OCI | 0 | |
Municipals | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 43 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | (2) | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | 0 | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 41 | |
Change in Unrealized Incl in OCI | 4 | |
Residential mortgage-backed securities | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 483 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | 12 | |
Assets, Purchases | 5 | |
Assets, Sales | 0 | |
Assets, Settlements | (13) | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 487 | |
Change in Unrealized Incl in OCI | 27 | |
Foreign Governments | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 17 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | 0 | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | 0 | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 17 | |
Change in Unrealized Incl in OCI | 2 | |
Equity securities | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 5 | 1 |
Assets, Total Gains (Losses) Included in Earnings | 1 | 0 |
Assets, Total Gains (Losses) Included in AOCI | 0 | 0 |
Assets, Purchases | 3 | 0 |
Assets, Sales | 0 | 0 |
Assets, Settlements | 0 | 0 |
Assets, Net transfer In (Out) of Level 3 | 0 | 0 |
Balance at End of Period | 9 | 1 |
Change in Unrealized Incl in OCI | 0 | 0 |
Available-for-sale embedded derivative | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 27 | |
Assets, Total Gains (Losses) Included in Earnings | 2 | |
Assets, Total Gains (Losses) Included in AOCI | 0 | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | 0 | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 29 | |
Change in Unrealized Incl in OCI | 0 | |
Credit linked note | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 23 | |
Assets, Total Gains (Losses) Included in Earnings | 0 | |
Assets, Total Gains (Losses) Included in AOCI | (4) | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | 0 | |
Assets, Net transfer In (Out) of Level 3 | 0 | |
Balance at End of Period | 19 | |
Change in Unrealized Incl in OCI | $ 0 | |
Other long-term investments | ||
Fixed maturity securities available-for-sale: | ||
Balance at Beginning of Period | 120 | |
Assets, Total Gains (Losses) Included in Earnings | (61) | |
Assets, Total Gains (Losses) Included in AOCI | 0 | |
Assets, Purchases | 0 | |
Assets, Sales | 0 | |
Assets, Settlements | 0 | |
Assets, Net transfer In (Out) of Level 3 | (59) | |
Balance at End of Period | 0 | |
Change in Unrealized Incl in OCI | $ 0 |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments - Carrying Value and Estimated Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Trade and notes receivables, net of allowance | $ 425 | $ 437 |
Fair Value | ||
Assets | ||
FHLB common stock | 64 | 66 |
Commercial mortgage loans | 1,197 | 926 |
Residential mortgage loans | 1,154 | 1,123 |
Policy loans | 34 | 33 |
Other invested assets | 26 | 28 |
Company-owned life insurance | 309 | 305 |
Trade and notes receivables, net of allowance | 425 | 437 |
Assets, carried on Balance Sheet at amounts other than fair value | 3,209 | 2,918 |
Liabilities | ||
Liabilities Related to Investment Contracts, Fair Value Disclosure | 22,880 | 21,719 |
Debt instrument | 2,796 | 2,896 |
Liabilities, carried on Balance Sheet at amounts other than fair value | 25,676 | 24,615 |
Carrying Value | ||
Assets | ||
FHLB common stock | 64 | 66 |
Commercial mortgage loans | 1,206 | 903 |
Residential mortgage loans | 1,168 | 1,128 |
Policy loans | 34 | 33 |
Other invested assets | 26 | 28 |
Company-owned life insurance | 309 | 305 |
Trade and notes receivables, net of allowance | 425 | 437 |
Assets, carried on Balance Sheet at amounts other than fair value | 3,232 | 2,900 |
Liabilities | ||
Liabilities Related to Investment Contracts, Fair Value Disclosure | 26,244 | 25,199 |
Debt instrument | 2,663 | 2,662 |
Liabilities, carried on Balance Sheet at amounts other than fair value | 28,907 | 27,861 |
Level 1 | ||
Assets | ||
FHLB common stock | 0 | 0 |
Commercial mortgage loans | 0 | 0 |
Residential mortgage loans | 0 | 0 |
Policy loans | 0 | 0 |
Other invested assets | 0 | 0 |
Company-owned life insurance | 0 | 0 |
Trade and notes receivables, net of allowance | 0 | 0 |
Assets, carried on Balance Sheet at amounts other than fair value | 0 | 0 |
Liabilities | ||
Liabilities Related to Investment Contracts, Fair Value Disclosure | 0 | 0 |
Debt instrument | 0 | 0 |
Liabilities, carried on Balance Sheet at amounts other than fair value | 0 | 0 |
Level 2 | ||
Assets | ||
FHLB common stock | 64 | 66 |
Commercial mortgage loans | 0 | 0 |
Residential mortgage loans | 0 | 0 |
Policy loans | 0 | 0 |
Other invested assets | 0 | 0 |
Company-owned life insurance | 0 | 0 |
Trade and notes receivables, net of allowance | 0 | 0 |
Assets, carried on Balance Sheet at amounts other than fair value | 64 | 66 |
Liabilities | ||
Liabilities Related to Investment Contracts, Fair Value Disclosure | 0 | 0 |
Debt instrument | 2,796 | 2,896 |
Liabilities, carried on Balance Sheet at amounts other than fair value | 2,796 | 2,896 |
Level 3 | ||
Assets | ||
FHLB common stock | 0 | 0 |
Commercial mortgage loans | 1,197 | 926 |
Residential mortgage loans | 1,154 | 1,123 |
Policy loans | 34 | 33 |
Other invested assets | 26 | 28 |
Company-owned life insurance | 309 | 305 |
Trade and notes receivables, net of allowance | 425 | 437 |
Assets, carried on Balance Sheet at amounts other than fair value | 3,145 | 2,852 |
Liabilities | ||
Liabilities Related to Investment Contracts, Fair Value Disclosure | 22,880 | 21,719 |
Debt instrument | 0 | 0 |
Liabilities, carried on Balance Sheet at amounts other than fair value | $ 22,880 | $ 21,719 |
Fair Value of Financial Instr_8
Fair Value of Financial Instruments - NAV (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Investments in unconsolidated affiliates | $ 1,424 | $ 1,294 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Investments in unconsolidated affiliates | 143 | 146 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees | Fair Value Measured at Net Asset Value | ||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||
Investments in unconsolidated affiliates | $ 1,281 | $ 1,148 |
Investments - Consolidated Inve
Investments - Consolidated Investments (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Available-for-sale securities | ||
Amortized Cost | $ 26,634 | $ 25,577 |
Allowance for Expected Credit Losses | (7) | (19) |
Gross Unrealized Gains | 1,504 | 2,068 |
Gross Unrealized Losses | (413) | (39) |
Fair Value/ Carrying Value | 27,718 | 27,587 |
Asset-backed securities | ||
Available-for-sale securities | ||
Amortized Cost | 6,358 | 5,941 |
Allowance for Expected Credit Losses | 0 | 0 |
Gross Unrealized Gains | 339 | 343 |
Gross Unrealized Losses | (35) | (18) |
Fair Value/ Carrying Value | 6,662 | 6,266 |
Commercial mortgage-backed securities | ||
Available-for-sale securities | ||
Amortized Cost | 2,514 | 2,490 |
Allowance for Expected Credit Losses | (1) | 0 |
Gross Unrealized Gains | 382 | 342 |
Gross Unrealized Losses | (5) | (3) |
Fair Value/ Carrying Value | 2,890 | 2,829 |
Corporates | ||
Available-for-sale securities | ||
Amortized Cost | 14,178 | 13,582 |
Allowance for Expected Credit Losses | (3) | (16) |
Gross Unrealized Gains | 633 | 1,184 |
Gross Unrealized Losses | (344) | (15) |
Fair Value/ Carrying Value | 14,464 | 14,735 |
Hybrids | ||
Available-for-sale securities | ||
Amortized Cost | 892 | 914 |
Allowance for Expected Credit Losses | 0 | 0 |
Gross Unrealized Gains | 60 | 80 |
Gross Unrealized Losses | 0 | 0 |
Fair Value/ Carrying Value | 952 | 994 |
Municipals | ||
Available-for-sale securities | ||
Amortized Cost | 1,399 | 1,333 |
Allowance for Expected Credit Losses | 0 | 0 |
Gross Unrealized Gains | 43 | 72 |
Gross Unrealized Losses | (25) | (2) |
Fair Value/ Carrying Value | 1,417 | 1,403 |
Residential mortgage-backed securities | ||
Available-for-sale securities | ||
Amortized Cost | 774 | 806 |
Allowance for Expected Credit Losses | (3) | (3) |
Gross Unrealized Gains | 37 | 23 |
Gross Unrealized Losses | (1) | (1) |
Fair Value/ Carrying Value | 807 | 825 |
U.S. Government | ||
Available-for-sale securities | ||
Amortized Cost | 333 | 332 |
Allowance for Expected Credit Losses | 0 | 0 |
Gross Unrealized Gains | 6 | 10 |
Gross Unrealized Losses | 0 | 0 |
Fair Value/ Carrying Value | 339 | 342 |
Foreign Governments | ||
Available-for-sale securities | ||
Amortized Cost | 186 | 179 |
Allowance for Expected Credit Losses | 0 | 0 |
Gross Unrealized Gains | 4 | 14 |
Gross Unrealized Losses | (3) | 0 |
Fair Value/ Carrying Value | $ 187 | $ 193 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Debt Securities, Available-for-sale [Line Items] | ||
Non-income producing investment fair value | $ 0 | $ 0 |
Accrued interest receivable | 246,000,000 | 235,000,000 |
FHLB collateral pledged | $ 1,803,000,000 | 1,622,000,000 |
Commercial mortgage loans, percentage of investments | 4.00% | |
DSC ratio, amortization period | 25 years | |
Carrying value | $ 1,424,000,000 | $ 1,294,000,000 |
Cannae Holdings Inc. | Equity securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investment owned, (in shares) | 5,706,134 | 5,706,134 |
Investment owned, at fair value | $ 226,000,000 | $ 253,000,000 |
Commitment to Invest | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investment commitment | 1,213,000,000 | |
Crescent Capital BDC Inc. | Commitment to Invest | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investment commitment | 83,000,000 | |
Limited Partnerships | ||
Debt Securities, Available-for-sale [Line Items] | ||
Investment commitment | 550,000,000 | |
Maximum loss exposure, amount | 1,831,000,000 | |
Carrying value | $ 1,281,000,000 | |
United States | ||
Debt Securities, Available-for-sale [Line Items] | ||
Residential mortgage loans, location percentage | 100.00% | |
Commercial Mortgage Loans | ||
Debt Securities, Available-for-sale [Line Items] | ||
Loan to value, threshold (less than) | 75.00% | |
Available-for-sale Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Assets held by insurance regulators | $ 17,127,000,000 | $ 16,714,000,000 |
Residential mortgage loans | ||
Debt Securities, Available-for-sale [Line Items] | ||
Percentage of total investments | 4.00% |
Investments - Amortized Cost an
Investments - Amortized Cost and Fair Value of Fixed Maturity Available-for-Sale Securities (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Due in one year or less, Amortized Cost | $ 531 | |
Due after one year through five years, Amortized Cost | 1,919 | |
Due after five years through ten years, Amortized Cost | 2,260 | |
Due after ten years, Amortized Cost | 12,252 | |
Subtotal, Amortized Cost | 16,962 | |
Other securities which provide for periodic payments, Amortized Cost | 9,672 | |
Amortized Cost | 26,634 | $ 25,577 |
Due in one year or less, Fair Value | 536 | |
Due after one year through five years, Fair Value | 2,029 | |
Due after five years through ten years, Fair Value | 2,346 | |
Due after ten years, Fair Value | 12,418 | |
Subtotal, Fair Value | 17,329 | |
Other securities which provide for periodic payments, Fair Value | 10,389 | |
Total fixed maturity available-for-sale securities, Fair Value | 27,718 | |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Other securities which provide for periodic payments, Amortized Cost | 6,358 | |
Amortized Cost | 6,358 | 5,941 |
Other securities which provide for periodic payments, Fair Value | 6,662 | |
Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Other securities which provide for periodic payments, Amortized Cost | 2,514 | |
Amortized Cost | 2,514 | $ 2,490 |
Other securities which provide for periodic payments, Fair Value | 2,890 | |
Structured hybrids | ||
Debt Securities, Available-for-sale [Line Items] | ||
Other securities which provide for periodic payments, Amortized Cost | 26 | |
Other securities which provide for periodic payments, Fair Value | 30 | |
Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Other securities which provide for periodic payments, Amortized Cost | 774 | |
Other securities which provide for periodic payments, Fair Value | $ 807 |
Investments - Allowance for Cre
Investments - Allowance for Credit Loss Aggregated By Investment Category (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Balance at Beginning of Period | $ (19) |
For credit losses on securities for which losses were not previously recorded | (1) |
For initial credit losses on purchased securities accounted for as PCD financial assets | 0 |
(Additions) reductions in allowance recorded on previously impaired securities | 7 |
For securities sold during the period | 0 |
For securities intended/required to be sold prior to recovery of amortized cost basis | 0 |
Write-offs charged against the allowance | 3 |
Recoveries of amounts previously written off | 3 |
Balance at End of Period | (7) |
Commercial mortgage-backed securities | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Balance at Beginning of Period | 0 |
For credit losses on securities for which losses were not previously recorded | (1) |
For initial credit losses on purchased securities accounted for as PCD financial assets | 0 |
(Additions) reductions in allowance recorded on previously impaired securities | 0 |
For securities sold during the period | 0 |
For securities intended/required to be sold prior to recovery of amortized cost basis | 0 |
Write-offs charged against the allowance | 0 |
Recoveries of amounts previously written off | 0 |
Balance at End of Period | (1) |
Corporates | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Balance at Beginning of Period | (16) |
For credit losses on securities for which losses were not previously recorded | 0 |
For initial credit losses on purchased securities accounted for as PCD financial assets | 0 |
(Additions) reductions in allowance recorded on previously impaired securities | 7 |
For securities sold during the period | 0 |
For securities intended/required to be sold prior to recovery of amortized cost basis | 0 |
Write-offs charged against the allowance | 3 |
Recoveries of amounts previously written off | 3 |
Balance at End of Period | (3) |
Residential mortgage-backed securities | |
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward] | |
Balance at Beginning of Period | (3) |
For credit losses on securities for which losses were not previously recorded | 0 |
For initial credit losses on purchased securities accounted for as PCD financial assets | 0 |
(Additions) reductions in allowance recorded on previously impaired securities | 0 |
For securities sold during the period | 0 |
For securities intended/required to be sold prior to recovery of amortized cost basis | 0 |
Write-offs charged against the allowance | 0 |
Recoveries of amounts previously written off | 0 |
Balance at End of Period | $ (3) |
Investments - Fair Value and Gr
Investments - Fair Value and Gross Unrealized Losses of Available-for-Sale Securities (Details) $ in Millions | Mar. 31, 2021USD ($)security | Dec. 31, 2020USD ($)security |
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | $ 7,873 | $ 1,550 |
Gross Unrealized Losses Less than 12 months | (411) | (39) |
Fair Value, 12 Months or longer | 6 | 36 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 7,879 | 1,586 |
Total Gross Unrealized Losses | $ (411) | $ (39) |
Total number of available-for-sale securities in an unrealized loss position less than twelve months | security | 726 | 222 |
Total number of available-for-sale securities in an unrealized loss position twelve months or longer | security | 2 | 11 |
Total number of available-for-sale securities in an unrealized loss position | security | 728 | 233 |
Asset-backed securities | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | $ 1,095 | $ 477 |
Gross Unrealized Losses Less than 12 months | (35) | (18) |
Fair Value, 12 Months or longer | 0 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 1,095 | 477 |
Total Gross Unrealized Losses | (35) | (18) |
Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 250 | 51 |
Gross Unrealized Losses Less than 12 months | (3) | (3) |
Fair Value, 12 Months or longer | 0 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 250 | 51 |
Total Gross Unrealized Losses | (3) | (3) |
Corporates | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 5,634 | 865 |
Gross Unrealized Losses Less than 12 months | (344) | (15) |
Fair Value, 12 Months or longer | 1 | 36 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 5,635 | 901 |
Total Gross Unrealized Losses | (344) | (15) |
Hybrids | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 31 | 1 |
Gross Unrealized Losses Less than 12 months | 0 | 0 |
Fair Value, 12 Months or longer | 0 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 31 | 1 |
Total Gross Unrealized Losses | 0 | 0 |
Municipals | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 686 | 115 |
Gross Unrealized Losses Less than 12 months | (25) | (2) |
Fair Value, 12 Months or longer | 0 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 686 | 115 |
Total Gross Unrealized Losses | (25) | (2) |
Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 37 | 30 |
Gross Unrealized Losses Less than 12 months | (1) | (1) |
Fair Value, 12 Months or longer | 0 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 37 | 30 |
Total Gross Unrealized Losses | (1) | (1) |
U.S. Government | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 42 | 11 |
Gross Unrealized Losses Less than 12 months | 0 | 0 |
Fair Value, 12 Months or longer | 0 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 42 | 11 |
Total Gross Unrealized Losses | 0 | 0 |
Foreign Governments | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Fair Values, Less than 12 months | 98 | 0 |
Gross Unrealized Losses Less than 12 months | (3) | 0 |
Fair Value, 12 Months or longer | 5 | 0 |
Gross Unrealized Losses, 12 months or longer | 0 | 0 |
Total Fair Value | 103 | 0 |
Total Gross Unrealized Losses | $ (3) | $ 0 |
Investments - Schedule of Comme
Investments - Schedule of Commercial Mortgage Loan Investment (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 905 | |
Commercial mortgage loans, % of Total | 100.00% | |
Commercial Mortgage | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 1,211 | $ 905 |
Allowance for expected credit loss | (5) | 2 |
Total commercial mortgage loans | $ 1,206 | $ 903 |
Commercial mortgage loans, % of Total | 100.00% | 100.00% |
Unpaid Principal Balance | $ 1,211 | $ 905 |
East North Central | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 65 | $ 61 |
Commercial mortgage loans, % of Total | 5.00% | 7.00% |
East South Central | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 80 | $ 80 |
Commercial mortgage loans, % of Total | 7.00% | 9.00% |
Middle Atlantic | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 180 | $ 100 |
Commercial mortgage loans, % of Total | 15.00% | 11.00% |
Mountain | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 89 | $ 48 |
Commercial mortgage loans, % of Total | 7.00% | 5.00% |
New England | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 82 | $ 79 |
Commercial mortgage loans, % of Total | 7.00% | 9.00% |
Pacific | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 418 | $ 333 |
Commercial mortgage loans, % of Total | 34.00% | 37.00% |
South Atlantic | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 226 | $ 133 |
Commercial mortgage loans, % of Total | 19.00% | 15.00% |
West North Central | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 13 | $ 13 |
Commercial mortgage loans, % of Total | 1.00% | 1.00% |
West South Central | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 58 | $ 58 |
Commercial mortgage loans, % of Total | 5.00% | 6.00% |
Hotel | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 19 | $ 19 |
Commercial mortgage loans, % of Total | 2.00% | 2.00% |
Industrial - General | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 337 | $ 302 |
Commercial mortgage loans, % of Total | 27.00% | 33.00% |
Industrial - Warehouse | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 19 | $ 12 |
Commercial mortgage loans, % of Total | 2.00% | 1.00% |
Multifamily | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 314 | $ 165 |
Commercial mortgage loans, % of Total | 26.00% | 18.00% |
Office | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 222 | $ 140 |
Commercial mortgage loans, % of Total | 18.00% | 15.00% |
Retail | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 134 | $ 142 |
Commercial mortgage loans, % of Total | 11.00% | 17.00% |
Other | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 141 | $ 125 |
Commercial mortgage loans, % of Total | 12.00% | 14.00% |
Student Housing | ||
Schedule of Investments [Line Items] | ||
Gross Carrying Value | $ 25 | |
Commercial mortgage loans, % of Total | 2.00% |
Investments - Recorded Investme
Investments - Recorded Investment in CMLs by LTV and DSC Ratio Categories (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Commercial mortgage loans, % of Total | 100.00% | |
Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 1,211 | $ 905 |
Commercial mortgage loans, % of Total | 100.00% | 100.00% |
Fair Value | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 1,197 | $ 927 |
Commercial mortgage loans, % of Total | 100.00% | 100.00% |
Greater than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 1,082 | $ 878 |
Greater than 1.00 but less than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 120 | 27 |
Greater than 1.00 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 9 | 0 |
Less than 50% | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 569 | $ 538 |
Commercial mortgage loans, % of Total | 48.00% | 60.00% |
Less than 50% | Fair Value | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 584 | $ 557 |
Commercial mortgage loans, % of Total | 49.00% | 60.00% |
Less than 50% | Greater than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 543 | $ 520 |
Less than 50% | Greater than 1.00 but less than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 17 | 18 |
Less than 50% | Greater than 1.00 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 9 | 0 |
LTV 50 to 60 Percent | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 270 | $ 246 |
Commercial mortgage loans, % of Total | 22.00% | 27.00% |
LTV 50 to 60 Percent | Fair Value | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 271 | $ 251 |
Commercial mortgage loans, % of Total | 23.00% | 27.00% |
LTV 50 to 60 Percent | Greater than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 270 | $ 237 |
LTV 50 to 60 Percent | Greater than 1.00 but less than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 0 | 9 |
LTV 50 to 60 Percent | Greater than 1.00 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 0 | 0 |
LTV 60 to 75 Percent | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 372 | $ 121 |
Commercial mortgage loans, % of Total | 30.00% | 13.00% |
LTV 60 to 75 Percent | Fair Value | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 342 | $ 119 |
Commercial mortgage loans, % of Total | 28.00% | 13.00% |
LTV 60 to 75 Percent | Greater than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 269 | $ 121 |
LTV 60 to 75 Percent | Greater than 1.00 but less than 1.25 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | 103 | 0 |
LTV 60 to 75 Percent | Greater than 1.00 | Commercial Mortgage | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unpaid Principal Balance | $ 0 | $ 0 |
Investments - Schedule of Resid
Investments - Schedule of Residential Mortgage Loan Investment (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Total Mortgage Loans | ||
Unpaid Principal Balance | $ 1,184 | $ 1,152 |
% of Total | 100.00% | 100.00% |
California | ||
Unpaid Principal Balance | $ 182 | $ 164 |
% of Total | 15.00% | 15.00% |
Florida | ||
Unpaid Principal Balance | $ 154 | $ 188 |
% of Total | 13.00% | 16.00% |
New Jersey | ||
Unpaid Principal Balance | $ 101 | $ 96 |
% of Total | 9.00% | 8.00% |
All Other States | ||
Unpaid Principal Balance | $ 747 | $ 704 |
% of Total | 63.00% | 61.00% |
Investments - Credit Quality of
Investments - Credit Quality of RMLs (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans, net | $ 2,374 | $ 2,031 |
Residential Portfolio Segment | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Carrying Value | 1,199 | 1,165 |
Allowance for expected credit loss | (31) | (37) |
Loans, net | $ 1,168 | $ 1,128 |
% of Total | 100.00% | 100.00% |
Allowance % of Total | 0.00% | 0.00% |
Residential Portfolio Segment | Performing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Carrying Value | $ 1,106 | $ 1,059 |
% of Total | 92.00% | 91.00% |
Residential Portfolio Segment | Non-performing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Carrying Value | $ 93 | $ 106 |
% of Total | 8.00% | 9.00% |
Investments - Loans Segregated
Investments - Loans Segregated by Risk Rating (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
Total non-accrual loans | $ 99 | $ 90 | |
Residential Portfolio Segment | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | $ 144 | 339 | |
2020 | 565 | 641 | |
2019 | 352 | 73 | |
2018 | 133 | 42 | |
2017 | 0 | 62 | |
Prior | 0 | 2 | |
Total | 1,194 | 1,159 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 144 | 339 | |
2019 | 565 | 641 | |
2018 | 352 | 73 | |
2017 | 133 | 42 | |
2016 | 0 | 62 | |
Prior | 0 | 2 | |
Total | 1,194 | 1,159 | |
Total non-accrual loans | 99 | 90 | |
Residential Portfolio Segment | Current (less than 30 days past due) | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 144 | 311 | |
2020 | 515 | 545 | |
2019 | 292 | 68 | |
2018 | 129 | 42 | |
2017 | 0 | 62 | |
Prior | 0 | 2 | |
Total | 1,080 | 1,030 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 144 | 311 | |
2019 | 515 | 545 | |
2018 | 292 | 68 | |
2017 | 129 | 42 | |
2016 | 0 | 62 | |
Prior | 0 | 2 | |
Total | 1,080 | 1,030 | |
Residential Portfolio Segment | 30-89 days past due | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 0 | 2 | |
2020 | 14 | 22 | |
2019 | 10 | 2 | |
2018 | 1 | 0 | |
2017 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 25 | 26 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 0 | 2 | |
2019 | 14 | 22 | |
2018 | 10 | 2 | |
2017 | 1 | 0 | |
2016 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 25 | 26 | |
Residential Portfolio Segment | Over 90 days past due | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 0 | 26 | |
2020 | 36 | 74 | |
2019 | 50 | 3 | |
2018 | 3 | 0 | |
2017 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 89 | 103 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 0 | 26 | |
2019 | 36 | 74 | |
2018 | 50 | 3 | |
2017 | 3 | 0 | |
2016 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 89 | 103 | |
Commercial Mortgage | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 308 | 542 | |
2020 | 542 | 0 | |
2019 | 0 | 6 | |
2018 | 6 | 0 | |
2017 | 0 | 11 | |
Prior | 355 | 346 | |
Total | 1,211 | 905 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 308 | 542 | |
2019 | 542 | 0 | |
2018 | 0 | 6 | |
2017 | 6 | 0 | |
2016 | 0 | 11 | |
Prior | 355 | 346 | |
Total | 1,211 | 905 | |
Total non-accrual loans | 0 | $ 0 | |
Commercial Mortgage | Greater than 1.25 | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 205 | 542 | |
2020 | 542 | 0 | |
2019 | 0 | 6 | |
2018 | 6 | 0 | |
2017 | 0 | 11 | |
Prior | 328 | 319 | |
Total | 1,081 | 878 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 205 | 542 | |
2019 | 542 | 0 | |
2018 | 0 | 6 | |
2017 | 6 | 0 | |
2016 | 0 | 11 | |
Prior | 328 | 319 | |
Total | 1,081 | 878 | |
Commercial Mortgage | Greater than 1.00 but less than 1.25 | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 103 | 0 | |
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
Prior | 18 | 27 | |
Total | 121 | 27 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 103 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
2016 | 0 | 0 | |
Prior | 18 | 27 | |
Total | 121 | 27 | |
Commercial Mortgage | Less than 1.00 | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 0 | 0 | |
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
Prior | 9 | 0 | |
Total | 9 | 0 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
2016 | 0 | 0 | |
Prior | 9 | 0 | |
Total | 9 | 0 | |
Commercial Mortgage | Less than 50% | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 15 | 228 | |
2020 | 228 | 0 | |
2019 | 0 | 6 | |
2018 | 6 | 0 | |
2017 | 0 | 0 | |
Prior | 320 | 303 | |
Total | 569 | 537 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 15 | 228 | |
2019 | 228 | 0 | |
2018 | 0 | 6 | |
2017 | 6 | 0 | |
2016 | 0 | 0 | |
Prior | 320 | 303 | |
Total | 569 | 537 | |
Commercial Mortgage | LTV 50 to 60 Percent | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 43 | 192 | |
2020 | 192 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 11 | |
Prior | 35 | 43 | |
Total | 270 | 246 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 43 | 192 | |
2019 | 192 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
2016 | 0 | 11 | |
Prior | 35 | 43 | |
Total | 270 | 246 | |
Commercial Mortgage | LTV 60 to 75 Percent | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 250 | 122 | |
2020 | 122 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 372 | 122 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 250 | 122 | |
2019 | 122 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
2016 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 372 | 122 | |
Commercial Mortgage | Current (less than 30 days past due) | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 308 | 542 | |
2020 | 542 | 0 | |
2019 | 0 | 6 | |
2018 | 6 | 0 | |
2017 | 0 | 11 | |
Prior | 355 | 346 | |
Total | 1,211 | 905 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 308 | 542 | |
2019 | 542 | 0 | |
2018 | 0 | 6 | |
2017 | 6 | 0 | |
2016 | 0 | 11 | |
Prior | 355 | 346 | |
Total | 1,211 | 905 | |
Commercial Mortgage | 30-89 days past due | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 0 | 0 | |
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 0 | 0 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
2016 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 0 | 0 | |
Commercial Mortgage | Over 90 days past due | |||
Financing Receivable Credit Quality Indicator Current Year Abstract [Abstract] | |||
2021 | 0 | 0 | |
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
Prior | 0 | 0 | |
Total | 0 | 0 | |
Financing Receivable Credit Quality Indicator Prior Year [Abstract] | |||
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 0 | 0 | |
2016 | 0 | 0 | |
Prior | 0 | 0 | |
Total | $ 0 | $ 0 |
Investments - Changes in Allowa
Investments - Changes in Allowance for Expected Credit Losses on Mortgage Loans (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |
Beginning Balance | $ 39 |
(Reversal of) provision for loan losses | (3) |
Ending Balance | 36 |
Residential Portfolio Segment | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |
Beginning Balance | 37 |
(Reversal of) provision for loan losses | (6) |
Ending Balance | 31 |
Commercial Mortgage | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | |
Beginning Balance | 2 |
(Reversal of) provision for loan losses | 3 |
Ending Balance | $ 5 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Schedule of Investments [Line Items] | ||
Gross investment income | $ 441 | $ 53 |
Investment expense | (39) | 0 |
Net investment income | 402 | 53 |
Fixed maturity securities, available-for-sale | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 307 | 17 |
Equity securities | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 5 | 3 |
Preferred securities | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 14 | 6 |
Commercial mortgage loans | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 23 | 0 |
Invested cash and short-term investments | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 0 | 7 |
Limited partnerships | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 80 | 0 |
Tax deferred property exchange income | ||
Schedule of Investments [Line Items] | ||
Gross investment income | 4 | 16 |
Other investments | ||
Schedule of Investments [Line Items] | ||
Gross investment income | $ 8 | $ 4 |
Investments - Investment Gains
Investments - Investment Gains (Losses) Net (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Schedule of Investments [Line Items] | ||
Net realized gains on fixed maturity available-for-sale securities | $ 40,000,000 | $ 3,000,000 |
Realized losses on other invested assets | (3,000,000) | (9,000,000) |
Change in allowance for expected credit losses | 10,000,000 | (4,000,000) |
Realized gains on certain derivative instruments | 60,000,000 | 0 |
Unrealized losses on certain derivative instruments | (35,000,000) | 0 |
Change in fair value of reinsurance related embedded derivatives | 27,000,000 | 0 |
Change in fair value of other derivatives and embedded derivatives | 0 | 0 |
Realized gains on derivatives and embedded derivatives | 52,000,000 | 0 |
Recognized gains and (losses), net | 43,000,000 | (320,000,000) |
Equity securities | ||
Schedule of Investments [Line Items] | ||
Equity Securities, FV-NI, Realized Gain (Loss) | (46,000,000) | (205,000,000) |
Valuation losses | 46,000,000 | 205,000,000 |
Preferred securities | ||
Schedule of Investments [Line Items] | ||
Equity Securities, FV-NI, Realized Gain (Loss) | (10,000,000) | (105,000,000) |
Valuation losses | $ (3,000,000) | $ 42,000,000 |
Investments - Proceeds From the
Investments - Proceeds From the Sale of Fixed-Maturity Available-For-Sale Securities (Details) - Total fixed maturities - Available-for-sale Securities - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Debt Securities, Available-for-sale [Line Items] | ||
Proceeds | $ 424 | $ 63 |
Gross gains | 32 | 12 |
Gross losses | $ (8) | $ (1) |
Derivative Financial Instrume_3
Derivative Financial Instruments - Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Derivative [Line Items] | ||
Total asset derivatives | $ 571 | $ 575 |
Total liability derivatives | 3,368 | 3,505 |
Call options | Derivative investments | ||
Derivative [Line Items] | ||
Total asset derivatives | 542 | 548 |
Futures contracts | Derivative investments | ||
Derivative [Line Items] | ||
Total asset derivatives | 1 | 0 |
Other derivatives and embedded derivatives | Other long-term investments | ||
Derivative [Line Items] | ||
Total asset derivatives | 27 | 27 |
Other derivatives and embedded derivatives | Funds withheld | ||
Derivative [Line Items] | ||
Total asset derivatives | 1 | 0 |
FIA embedded derivative | Contractholder funds | ||
Derivative [Line Items] | ||
Total liability derivatives | 3,293 | 3,404 |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Other Liabilities | ||
Derivative [Line Items] | ||
Total liability derivatives | $ 75 | $ 101 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Schedule of Change in Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Derivative [Line Items] | ||
Change in fair value of reinsurance related embedded derivatives | $ 27 | $ 0 |
Net investment (losses) gains | ||
Derivative [Line Items] | ||
Change in fair value of reinsurance related embedded derivatives | 53 | |
Call options | Net investment (losses) gains | ||
Derivative [Line Items] | ||
Change in fair value of reinsurance related embedded derivatives | 22 | |
Foreign currency forward | Net investment (losses) gains | ||
Derivative [Line Items] | ||
Change in fair value of reinsurance related embedded derivatives | 4 | |
Reinsurance related embedded derivatives, included in accounts payable and accrued liabilities | Net investment (losses) gains | ||
Derivative [Line Items] | ||
Change in fair value of reinsurance related embedded derivatives | 27 | |
FIA embedded derivative | ||
Derivative [Line Items] | ||
Change in fair value of reinsurance related embedded derivatives | $ (111) |
Derivative Financial Instrume_5
Derivative Financial Instruments - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($)contract | |
Embedded derivatives | |
Derivative [Line Items] | |
Term of contract, term one | 1 year |
Term of contract, term two | 2 years |
Term of contract, term three | 3 years |
Term of contract, term four | 5 years |
Call options | Not Designated as Hedging Instrument | |
Derivative [Line Items] | |
Collateral posted | $ 513 |
Maximum amount of loss due to credit risk | 41 |
Call options | Derivatives for Trading and Investment | Not Designated as Hedging Instrument | |
Derivative [Line Items] | |
Collateral posted | 513 |
Maximum amount of loss due to credit risk | 41 |
Call options | Cash and Cash Equivalents | Not Designated as Hedging Instrument | |
Derivative [Line Items] | |
Collateral posted | $ 371 |
Futures contracts | |
Derivative [Line Items] | |
Number of instruments held | contract | 404,000,000 |
Collateral held | $ 4 |
Derivative Financial Instrume_6
Derivative Financial Instruments - FGL's Exposure to Credit Loss on Call Options Held (Detail) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Fair Value | $ 571 | $ 575 |
Not Designated as Hedging Instrument | Call options | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 16,630 | |
Fair Value | 542 | |
Collateral | 513 | |
Net Credit Risk | 41 | |
Not Designated as Hedging Instrument | Call options | Merrill Lynch | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 1,716 | |
Fair Value | 91 | |
Collateral | 51 | |
Net Credit Risk | 40 | |
Not Designated as Hedging Instrument | Call options | Morgan Stanley | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 1,612 | |
Fair Value | 65 | |
Collateral | 70 | |
Net Credit Risk | 0 | |
Not Designated as Hedging Instrument | Call options | Barclay's Bank | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 5,294 | |
Fair Value | 105 | |
Collateral | 109 | |
Net Credit Risk | 0 | |
Not Designated as Hedging Instrument | Call options | Canadian Imperial Bank of Commerce | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 2,166 | |
Fair Value | 79 | |
Collateral | 79 | |
Net Credit Risk | 0 | |
Not Designated as Hedging Instrument | Call options | Wells Fargo | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 2,537 | |
Fair Value | 101 | |
Collateral | 100 | |
Net Credit Risk | 1 | |
Not Designated as Hedging Instrument | Call options | Goldman Sachs | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 268 | |
Fair Value | 12 | |
Collateral | 13 | |
Net Credit Risk | 0 | |
Not Designated as Hedging Instrument | Call options | Credit Suisse | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 2,013 | |
Fair Value | 57 | |
Collateral | 59 | |
Net Credit Risk | 0 | |
Not Designated as Hedging Instrument | Call options | Truist | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | 1,024 | |
Fair Value | 32 | |
Collateral | 32 | |
Net Credit Risk | $ 0 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ / shares in Units, $ in Millions | Aug. 17, 2020shares | Mar. 31, 2021USD ($)lawsuit | Jun. 30, 2021USD ($)$ / shares | Dec. 31, 2020USD ($) |
Other Commitments [Line Items] | ||||
Estimated litigation liability | $ | $ 15 | $ 13 | ||
Alight | Forecast | Subscription Agreements with Alight Holdings, Inc. and Foley Trasimene Acquisition Corp. | Subsequent Event | ||||
Other Commitments [Line Items] | ||||
Subscription agreements, investment | $ | $ 150 | |||
Subscription agreement, stock purchase, par value (in usd per share) | $ / shares | $ 0.001 | |||
Subscription agreement, stock purchase, share price (in usd per share) | $ / shares | $ 10 | |||
Matter of FGL Holdings | ||||
Other Commitments [Line Items] | ||||
Number of lawsuits filed | lawsuit | 2 | |||
Number of shares in which statutory appraisal rights have been claimed (in shares) | shares | 12,000,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Investment Commitments (Details) - Commitment to Invest $ in Millions | Mar. 31, 2021USD ($) |
Other Commitments [Line Items] | |
Unfunded investment commitment | $ 1,213 |
Other invested assets | |
Other Commitments [Line Items] | |
Unfunded investment commitment | 584 |
Fixed maturity securities, available-for-sale | |
Other Commitments [Line Items] | |
Unfunded investment commitment | 496 |
Other assets | |
Other Commitments [Line Items] | |
Unfunded investment commitment | 83 |
Commercial mortgage loans | |
Other Commitments [Line Items] | |
Unfunded investment commitment | 46 |
Residential mortgage loans | |
Other Commitments [Line Items] | |
Unfunded investment commitment | $ 4 |
Dividends (Details)
Dividends (Details) - $ / shares | May 06, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Subsequent Event [Line Items] | |||
Cash dividend per common share (in dollars per share) | $ 0.36 | $ 0.33 | |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Cash dividend per common share (in dollars per share) | $ 0.36 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | |||
Title premiums | $ 1,804 | $ 1,278 | |
Escrow, title-related and other fees | 851 | 601 | |
Revenues from external customers | 2,655 | 1,879 | |
Interest and investment income, including recognized gains and losses | 445 | (267) | |
Total revenues | 3,100 | 1,612 | |
Depreciation and amortization | 183 | 43 | |
Interest expense | 28 | 12 | |
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated affiliates | 757 | (86) | |
Income tax expense (benefit) | 166 | (28) | |
Earnings (loss) before equity in earnings of unconsolidated affiliates | 591 | (58) | |
Equity in earnings (loss) of unconsolidated affiliates | 13 | 1 | |
Net earnings (loss) from continuing operations | 604 | (57) | |
Assets | 51,489 | 10,204 | $ 50,455 |
Goodwill | 4,498 | 2,726 | $ 4,495 |
Corporate and Other | |||
Segment Reporting Information [Line Items] | |||
Title premiums | 0 | 0 | |
Escrow, title-related and other fees | 42 | (9) | |
Revenues from external customers | 42 | (9) | |
Interest and investment income, including recognized gains and losses | 0 | (2) | |
Total revenues | 42 | (11) | |
Depreciation and amortization | 6 | 6 | |
Interest expense | 20 | 12 | |
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated affiliates | (38) | (33) | |
Income tax expense (benefit) | (9) | (9) | |
Earnings (loss) before equity in earnings of unconsolidated affiliates | (29) | (24) | |
Equity in earnings (loss) of unconsolidated affiliates | 5 | 0 | |
Net earnings (loss) from continuing operations | (24) | (24) | |
Assets | 1,486 | 1,476 | |
Goodwill | 266 | 266 | |
Operating Segments | Title | |||
Segment Reporting Information [Line Items] | |||
Title premiums | 1,804 | 1,278 | |
Escrow, title-related and other fees | 745 | 610 | |
Revenues from external customers | 2,549 | 1,888 | |
Interest and investment income, including recognized gains and losses | (30) | (265) | |
Total revenues | 2,519 | 1,623 | |
Depreciation and amortization | 33 | 37 | |
Interest expense | 0 | 0 | |
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated affiliates | 439 | (53) | |
Income tax expense (benefit) | 103 | (19) | |
Earnings (loss) before equity in earnings of unconsolidated affiliates | 336 | (34) | |
Equity in earnings (loss) of unconsolidated affiliates | 8 | 1 | |
Net earnings (loss) from continuing operations | 344 | (33) | |
Assets | 9,389 | 8,728 | |
Goodwill | 2,481 | $ 2,460 | |
Operating Segments | F&G | |||
Segment Reporting Information [Line Items] | |||
Title premiums | 0 | ||
Escrow, title-related and other fees | 64 | ||
Revenues from external customers | 64 | ||
Interest and investment income, including recognized gains and losses | 475 | ||
Total revenues | 539 | ||
Depreciation and amortization | 144 | ||
Interest expense | 8 | ||
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated affiliates | 356 | ||
Income tax expense (benefit) | 72 | ||
Earnings (loss) before equity in earnings of unconsolidated affiliates | 284 | ||
Equity in earnings (loss) of unconsolidated affiliates | 0 | ||
Net earnings (loss) from continuing operations | 284 | ||
Assets | 40,614 | ||
Goodwill | $ 1,751 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash paid for: | ||
Interest | $ 29 | $ 22 |
Income taxes | 7 | 4 |
Deferred sales inducements | 21 | 0 |
Non-cash investing and financing activities: | ||
Change in proceeds of sales of investments available for sale receivable in period | (9) | 0 |
Change in purchases of investments available for sale payable in period | 164 | 0 |
Change in treasury stock purchases payable in period | 0 | (5) |
Lease liabilities recognized in exchange for lease right-of-use assets | 5 | 8 |
Remeasurement of lease liabilities | $ 13 | $ 22 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 661 | $ 477 |
Interest and investment income | 402 | 53 |
Recognized gains and losses, net | 43 | (320) |
Total revenues | 3,100 | 1,612 |
Title | ||
Disaggregation of Revenue [Line Items] | ||
Loan subservicing revenue | 87 | 81 |
Title | Direct title insurance premiums | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 746 | 546 |
Title | Agency title insurance premiums | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 1,058 | 732 |
Title | Home warranty | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 39 | 43 |
Title | Insurance contracts | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 1,907 | 1,321 |
Title | Escrow fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 324 | 221 |
Title | Other title-related fees and income | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 205 | 159 |
Title | ServiceLink, excluding title premiums, escrow fees, and subservicing fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 90 | 106 |
F&G | Life Insurance Premiums, Insurance and Investment Product Fees, Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 64 | 0 |
Corporate and other | Real estate technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 32 | 27 |
Corporate and other | Real estate brokerage | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 0 | 6 |
Corporate and other | Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 10 | $ (42) |
Revenue Recognition - Informati
Revenue Recognition - Information about Receivables and Deferred Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Trade receivables | $ 390 | $ 404 |
Deferred revenue (contract liabilities) | $ 116 | $ 117 |
Policy period | 1 year | |
Revenue recognized | $ 41 |
Value of Business Acquired, D_3
Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements - Summary of Changes in Carrying Amounts of Intangible Assets Including DAC, VOBA and DSI (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Total | |
Balance at beginning of period | $ 1,724 |
F&G acquisition | 1,724 |
Deferrals | 154 |
Amortization | (148) |
Interest | 10 |
Unlocking | 1 |
Adjustment for net unrealized investment (gains) losses | 127 |
Balance at end of period | 1,868 |
VOBA | |
Total | |
Balance at beginning of period | 1,466 |
F&G acquisition | 1,466 |
Deferrals | 0 |
Amortization | (132) |
Interest | 8 |
Unlocking | 1 |
Adjustment for net unrealized investment (gains) losses | 132 |
Balance at end of period | 1,475 |
DAC | |
Total | |
Balance at beginning of period | 222 |
F&G acquisition | 222 |
Deferrals | 133 |
Amortization | (8) |
Interest | 2 |
Unlocking | 0 |
Adjustment for net unrealized investment (gains) losses | (5) |
Balance at end of period | 344 |
DSI | |
Total | |
Balance at beginning of period | 36 |
F&G acquisition | 36 |
Deferrals | 21 |
Amortization | (8) |
Interest | 0 |
Unlocking | 0 |
Adjustment for net unrealized investment (gains) losses | 0 |
Balance at end of period | $ 49 |
Value of Business Acquired, D_4
Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements - Narrative (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
VOBA | |
Finite-Lived Intangible Assets [Line Items] | |
Adjustment for net unrealized investment gains | $ (152) |
VOBA | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Interest accrual rate utilized to calculate accretion of interest | 0.00% |
VOBA | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Interest accrual rate utilized to calculate accretion of interest | 4.71% |
DAC | |
Finite-Lived Intangible Assets [Line Items] | |
Cumulative adjustments for net unrealized investment gains | $ 30 |
Deferred sales inducement, unrealized investment gain | $ 4 |
Value of Business Acquired, D_5
Value of Business Acquired, Deferred Acquisition Costs and Deferred Sales Inducements - Estimated Amortization Expense for VOBA in Future Fiscal Periods (Detail) $ in Millions | Mar. 31, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 | $ 59 |
2022 | 190 |
2023 | 185 |
2024 | 172 |
2025 | 168 |
Thereafter | $ 853 |
F&G Reinsurance - Effect of Rei
F&G Reinsurance - Effect of Reinsurance on Premiums Earned, Benefits Incurred and Reserve Changes (Detail) - Traditional Life Insurance Premiums $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Premiums and other considerations: | |
Direct | $ 44 |
Ceded | (33) |
Net | 11 |
Benefits and Other Changes in Insurance Policy Reserves: | |
Direct | 293 |
Ceded | (319) |
Net | $ (26) |
F&G Reinsurance - Narrative (De
F&G Reinsurance - Narrative (Details) $ in Millions | Jan. 15, 2021 | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Ceded Credit Risk [Line Items] | |||
Expected credit losses on reinsurance recoverable | $ 21 | $ 21 | |
Number of policies reinsured by foreign company not engaged in insurance | 0 | ||
Funds withheld co-insurance basis, percentage | 50.00% | ||
Wilton Reassurance Company | |||
Ceded Credit Risk [Line Items] | |||
Net amount recoverable | $ 1,489 | ||
Kubera Reassurance Company | |||
Ceded Credit Risk [Line Items] | |||
Net amount recoverable | 803 | ||
Scottish Re | |||
Ceded Credit Risk [Line Items] | |||
Net amount recoverable | 50 | ||
Pavonia Life Insurance Company | |||
Ceded Credit Risk [Line Items] | |||
Net amount recoverable | $ 94 |
F&G Insurance Subsidiary Fina_2
F&G Insurance Subsidiary Financial Information and Regulatory Matters - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Statutory Accounting Practices [Line Items] | ||
Increase (decrease) in statutory capital surplus | $ (133) | $ (144) |
Change in statutory capital surplus | 85 | |
Statutory capital and surplus | 90 | 84 |
IOWA | ||
Statutory Accounting Practices [Line Items] | ||
Change in statutory capital surplus | 5 | |
Non-permitted statutory accounting practices | $ 1 | $ (6) |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - F&G $ in Billions | Jun. 01, 2020USD ($) |
Business Acquisition [Line Items] | |
Percentage of outstanding equity acquired | 100.00% |
Consideration transferred | $ 2.7 |