Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 01, 2019 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity File Number | 001-37905 | |
Entity Central Index Key | 0001685040 | |
Entity Registrant Name | Brighthouse Financial, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-3846992 | |
Entity Address, Address Line One | 11225 North Community House Road, | |
Entity Address, City or Town | Charlotte, | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28277 | |
City Area Code | 980 | |
Local Phone Number | 365-7100 | |
Entity Listings [Line Items] | ||
Current Fiscal Year End Date | --12-31 | |
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 | 107,943,076 | |
6.250% Junior Subordinated Debentures due 2058 | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | 6.250% Junior Subordinated Debentures due 2058 | |
Trading Symbol | BHFAL | |
Security Exchange Name | NASDAQ | |
Common Stock, par value $0.01 per share | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | BHF | |
Security Exchange Name | NASDAQ | |
Depositary Shares, each representing a 1/1,000th interest in a share of 6.600% Non-Cumulative Preferred Stock, Series A | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Depositary Shares, each representing a 1/1,000th interest in a share | |
Trading Symbol | BHFAP | |
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Investments: | ||
Fixed maturity securities available-for-sale, at estimated fair value (amortized cost: $63,115 and $60,920, respectively) | $ 70,723 | $ 62,608 |
Equity securities, at estimated fair value | 148 | 140 |
Mortgage loans (net of valuation allowances of $64 and $57, respectively) | 15,359 | 13,694 |
Policy loans | 1,332 | 1,421 |
Real estate limited partnerships and limited liability companies | 458 | 451 |
Other limited partnership interests | 1,895 | 1,840 |
Short-term investments, principally at estimated fair value | 1,985 | 0 |
Other invested assets, principally at estimated fair value | 4,734 | 3,027 |
Total investments | 96,634 | 83,181 |
Cash and cash equivalents | 4,289 | 4,145 |
Accrued investment income | 732 | 724 |
Premiums, reinsurance and other receivables | 14,385 | 13,697 |
Deferred policy acquisition costs and value of business acquired | 5,317 | 5,717 |
Current income tax recoverable | 14 | 1 |
Other assets | 577 | 573 |
Separate account assets | 103,928 | 98,256 |
Total assets | 225,876 | 206,294 |
Liabilities | ||
Liability for Future Policy Benefit, after Reinsurance | 39,846 | 36,209 |
Policyholder account balances | 44,919 | 40,054 |
Other policy-related balances | 3,079 | 3,000 |
Payables for collateral under securities loaned and other transactions | 5,291 | 5,057 |
Long-term debt | 4,365 | 3,963 |
Current income tax payable | 0 | 15 |
Deferred income tax liability | 1,749 | 972 |
Other liabilities | 4,939 | 4,285 |
Separate account liabilities | 103,928 | 98,256 |
Total liabilities | 208,116 | 191,811 |
Contingencies, Commitments and Guarantees (Note 11) | ||
Brighthouse Financial, Inc.’s stockholders’ equity: | ||
Preferred stock, par value $0.01 per share; $425 aggregate liquidation preference at September 30, 2019 | 0 | 0 |
Common stock, par value $0.01 per share; 1,000,000,000 shares authorized; 120,614,815 and 120,448,018 shares issued, respectively; 109,264,305 and 117,532,336 shares outstanding, respectively | 1 | 1 |
Additional paid-in capital | 12,897 | 12,473 |
Retained earnings (deficit) | 1,662 | 1,346 |
Treasury stock, at cost; 11,350,510 and 2,915,682 shares, respectively | (432) | (118) |
Accumulated other comprehensive income (loss) | 3,567 | 716 |
Total Brighthouse Financial, Inc.’s stockholders’ equity | 17,695 | 14,418 |
Noncontrolling interests | 65 | 65 |
Total equity | 17,760 | 14,483 |
Total liabilities and equity | $ 225,876 | $ 206,294 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Assets | ||
Amortized cost of fixed maturity securities available-for-sale | $ 63,115 | $ 60,920 |
Mortgage loans valuation allowances | $ 64 | $ 57 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Liquidation Preference, Value | $ 425 | $ 0 |
Brighthouse Financial, Inc.’s stockholders’ equity: | ||
Treasury stock, shares | 11,350,510 | 2,915,682 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 120,614,815 | 120,448,018 |
Common stock, shares outstanding | 109,264,305 | 117,532,336 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenues | ||||
Premiums | $ 214 | $ 225 | $ 673 | $ 677 |
Universal life and investment-type product policy fees | 867 | 972 | 2,630 | 2,936 |
Net investment income | 928 | 853 | 2,681 | 2,476 |
Other revenues | 94 | 105 | 282 | 308 |
Net investment gains (losses) | 27 | (42) | 79 | (121) |
Net derivative gains (losses) | 1,057 | (691) | (97) | (1,337) |
Total revenues | 3,187 | 1,422 | 6,248 | 4,939 |
Expenses | ||||
Policyholder benefits and claims | 1,319 | 822 | 2,936 | 2,373 |
Interest credited to policyholder account balances | 272 | 273 | 795 | 809 |
Amortization of deferred policy acquisition costs and value of business acquired | 181 | 30 | 373 | 581 |
Other expenses | 611 | 665 | 1,824 | 1,974 |
Total expenses | 2,383 | 1,790 | 5,928 | 5,737 |
Income (loss) before provision for income tax | 804 | (368) | 320 | (798) |
Provision for income tax expense (benefit) | 119 | (99) | (14) | (226) |
Net income (loss) | 685 | (269) | 334 | (572) |
Less: Net income (loss) attributable to noncontrolling interests | 2 | 2 | 4 | 5 |
Net income (loss) attributable to Brighthouse Financial, Inc. | 683 | (271) | 330 | (577) |
Less: Preferred stock dividends | 7 | 0 | 14 | 0 |
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | 676 | (271) | 316 | (577) |
Comprehensive income (loss) | 1,550 | (532) | 3,185 | (1,617) |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 2 | 2 | 4 | 5 |
Comprehensive income (loss) attributable to Brighthouse Financial, Inc. | $ 1,548 | $ (534) | $ 3,181 | $ (1,622) |
Basic | $ 6.09 | $ (2.26) | $ 2.77 | $ (4.82) |
Diluted | $ 6.06 | $ (2.26) | $ 2.75 | $ (4.82) |
Consolidated Statements of Equi
Consolidated Statements of Equity (Unaudited) - USD ($) $ in Millions | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings (Deficit) | Treasury Stock at Cost | Accumulated Other Comprehensive Income (Loss) | Brighthouse Financial, Inc.’s Stockholders’ Equity | Noncontrolling Interests | Restatement adjustment | Restatement adjustmentPreferred Stock | Restatement adjustmentCommon Stock | Restatement adjustmentAdditional Paid-in Capital | Restatement adjustmentRetained Earnings (Deficit) | Restatement adjustmentTreasury Stock at Cost | Restatement adjustmentAccumulated Other Comprehensive Income (Loss) | Restatement adjustmentBrighthouse Financial, Inc.’s Stockholders’ Equity | Restatement adjustmentNoncontrolling Interests |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 14,580 | $ 65 | $ 14,576 | $ 65 | ||||||||||||||
Cumulative effect of change in accounting principle and other, net of income tax | (4) | $ 75 | $ (79) | $ (4) | ||||||||||||||
Beginning Balance at Dec. 31, 2017 | $ 0 | $ 1 | $ 12,432 | 406 | $ 0 | 1,676 | 14,515 | $ 0 | $ 1 | $ 12,432 | $ 481 | $ 0 | $ 1,597 | $ 14,511 | ||||
Share-based compensation | 12 | 12 | 12 | |||||||||||||||
Change in noncontrolling interests | (3) | 0 | (3) | |||||||||||||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | (306) | (306) | 3 | |||||||||||||||
Net income (loss) | (303) | |||||||||||||||||
Other comprehensive income (loss), net of income tax | (782) | (782) | (782) | |||||||||||||||
Ending Balance at Jun. 30, 2018 | 0 | 1 | 12,444 | 175 | 0 | 815 | 13,435 | |||||||||||
Beginning Balance at Dec. 31, 2017 | 0 | 1 | 12,432 | 406 | 0 | 1,676 | 14,515 | $ 0 | $ 1 | $ 12,432 | $ 481 | $ 0 | $ 1,597 | $ 14,511 | ||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | (577) | |||||||||||||||||
Net income (loss) | (572) | |||||||||||||||||
Ending Balance at Sep. 30, 2018 | 0 | 1 | 12,469 | (96) | (42) | 552 | 12,884 | |||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 13,500 | 65 | ||||||||||||||||
Beginning Balance at Jun. 30, 2018 | 0 | 1 | 12,444 | 175 | 0 | 815 | 13,435 | |||||||||||
Treasury stock acquired in connection with share repurchases | (42) | (42) | (42) | |||||||||||||||
Share-based compensation | 25 | 25 | 25 | |||||||||||||||
Change in noncontrolling interests | (2) | 0 | (2) | |||||||||||||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | (271) | (271) | (271) | 2 | ||||||||||||||
Net income (loss) | (269) | |||||||||||||||||
Other comprehensive income (loss), net of income tax | (263) | (263) | (263) | |||||||||||||||
Ending Balance at Sep. 30, 2018 | 0 | 1 | 12,469 | (96) | (42) | 552 | 12,884 | |||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 12,949 | 65 | ||||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 14,483 | 65 | ||||||||||||||||
Beginning Balance at Dec. 31, 2018 | 14,418 | 0 | 1 | 12,473 | 1,346 | (118) | 716 | 14,418 | ||||||||||
Preferred stock issuance | 412 | 0 | 412 | 412 | ||||||||||||||
Treasury stock acquired in connection with share repurchases | (188) | (188) | (188) | |||||||||||||||
Share-based compensation | 8 | 8 | 8 | |||||||||||||||
Dividends on preferred stock | (7) | (7) | (7) | |||||||||||||||
Change in noncontrolling interests | (2) | 0 | (2) | |||||||||||||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | (353) | (353) | 2 | |||||||||||||||
Net income (loss) | (351) | |||||||||||||||||
Other comprehensive income (loss), net of income tax | 1,986 | 1,986 | 1,986 | |||||||||||||||
Ending Balance at Jun. 30, 2019 | 0 | 1 | 12,893 | 986 | (306) | 2,702 | 16,276 | |||||||||||
Beginning Balance at Dec. 31, 2018 | 14,418 | 0 | 1 | 12,473 | 1,346 | (118) | 716 | 14,418 | ||||||||||
Treasury stock acquired in connection with share repurchases | (314) | |||||||||||||||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | 316 | |||||||||||||||||
Net income (loss) | 334 | |||||||||||||||||
Ending Balance at Sep. 30, 2019 | 17,695 | 0 | 1 | 12,897 | 1,662 | (432) | 3,567 | 17,695 | ||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 16,341 | 65 | ||||||||||||||||
Beginning Balance at Jun. 30, 2019 | 0 | 1 | 12,893 | 986 | (306) | 2,702 | 16,276 | |||||||||||
Treasury stock acquired in connection with share repurchases | (126) | (126) | (126) | |||||||||||||||
Share-based compensation | 4 | 4 | 4 | |||||||||||||||
Dividends on preferred stock | (7) | (7) | (7) | |||||||||||||||
Change in noncontrolling interests | (2) | 0 | (2) | |||||||||||||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | 676 | 683 | 683 | 2 | ||||||||||||||
Net income (loss) | 685 | |||||||||||||||||
Other comprehensive income (loss), net of income tax | 865 | 865 | 865 | |||||||||||||||
Ending Balance at Sep. 30, 2019 | 17,695 | $ 0 | $ 1 | $ 12,897 | $ 1,662 | $ (432) | $ 3,567 | $ 17,695 | ||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 17,760 | $ 65 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Cash Flows [Abstract] | ||
Net cash provided by (used in) operating activities | $ 1,322 | $ 1,496 |
Cash flows from investing activities | ||
Sales, maturities and repayments of fixed maturity securities | 11,888 | 11,680 |
Sales, maturities and repayments of equity securities | 29 | 15 |
Sales, maturities and repayments of mortgage loans | 933 | 446 |
Sales, maturities and repayments of real estate limited partnerships and limited liability companies | 2 | 87 |
Sales, maturities and repayments of other limited partnership interests | 203 | 137 |
Purchases of fixed maturity securities | (13,412) | (12,005) |
Purchases of equity securities | (3) | (1) |
Purchases of mortgage loans | (2,625) | (2,771) |
Purchases of real estate limited partnerships and limited liability companies | (13) | (31) |
Purchases of other limited partnership interests | (308) | (194) |
Cash received in connection with freestanding derivatives | 1,179 | 1,142 |
Cash paid in connection with freestanding derivatives | (1,705) | (2,286) |
Net change in policy loans | 89 | 81 |
Net change in short-term investments | (1,977) | 196 |
Net change in other invested assets | 21 | 35 |
Net cash provided by (used in) investing activities | (5,699) | (3,469) |
Cash flows from financing activities | ||
Policyholder account balances: Deposits | 5,689 | 4,704 |
Policyholder account balances: Withdrawals | (2,021) | (2,199) |
Net change in payables for collateral under securities loaned and other transactions | 234 | (126) |
Long-term debt issued | 1,000 | 375 |
Long-term debt repaid | (601) | (9) |
Preferred stock issued, net of issuance costs | 412 | 0 |
Dividends on preferred stock | (14) | 0 |
Treasury stock acquired in connection with share repurchases | (314) | (42) |
Financing element on certain derivative instruments and other derivative related transactions, net | 179 | (386) |
Other, net | (43) | (57) |
Net cash provided by (used in) financing activities | 4,521 | 2,260 |
Change in cash, cash equivalents and restricted cash | 144 | 287 |
Cash, cash equivalents and restricted cash, beginning of period | 4,145 | 1,857 |
Cash, cash equivalents and restricted cash, end of period | 4,289 | 2,144 |
Supplemental disclosures of cash flow information | ||
Net cash paid (received) for interest | 108 | 83 |
Net cash paid (received) for income tax | $ 8 | $ 3 |
Business, Basis of Presentation
Business, Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business, Basis of Presentation and Summary of Significant Accounting Policies | 1. Business, Basis of Presentation and Summary of Significant Accounting Policies Business “Brighthouse Financial” and the “Company” refer to Brighthouse Financial, Inc. and its subsidiaries (formerly, MetLife U.S. Retail Separation Business). Brighthouse Financial, Inc. (“BHF”) is a holding company formed to own the legal entities that historically operated a substantial portion of MetLife, Inc.’s (together with its subsidiaries and affiliates, “MetLife”) former Retail segment. BHF was incorporated in Delaware on August 1, 2016 in preparation for MetLife, Inc.’s separation of a substantial portion of its former Retail segment, as well as certain portions of its former Corporate Benefit Funding segment (the “Separation”), which was completed on August 4, 2017. In connection with the Separation, 80.8% of MetLife, Inc.’s interest in BHF was distributed to holders of MetLife, Inc.’s common stock and MetLife, Inc. retained the remaining 19.2% . On June 14, 2018, MetLife, Inc. divested its remaining shares of BHF common stock (the “MetLife Divestiture”). As a result, MetLife, Inc. and its subsidiaries and affiliates are no longer considered related parties subsequent to the MetLife Divestiture. Brighthouse Financial is one of the largest providers of annuity and life insurance products in the United States through multiple independent distribution channels and marketing arrangements with a diverse network of distribution partners. The Company is organized into three segments: Annuities; Life; and Run-off. In addition, the Company reports certain of its results of operations in Corporate & Other. Basis of Presentation The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported on the interim condensed consolidated financial statements. In applying these policies and estimates, management makes subjective and complex judgments that frequently require assumptions about matters that are inherently uncertain. Many of these policies, estimates and related judgments are common in the insurance and financial services industries; others are specific to the Company’s business and operations. Actual results could differ from these estimates. Consolidation The accompanying interim condensed consolidated financial statements include the accounts of Brighthouse Financial, as well as partnerships and limited liability companies (“LLCs”) in which the Company has control. Intercompany accounts and transactions have been eliminated. The Company uses the equity method of accounting for investments in limited partnerships and LLCs when it has more than a minor ownership interest or more than a minor influence over the investee’s operations. The Company generally recognizes its share of the investee’s earnings on a three-month lag in instances where the investee’s financial information is not sufficiently timely or when the investee’s reporting period differs from the Company’s reporting period. When the Company has virtually no influence over the investee’s operations, the investment is carried at fair value. Reclassifications Certain amounts in the prior year periods’ interim condensed consolidated financial statements and related footnotes thereto have been reclassified to conform with the 2019 presentation as may be discussed throughout the Notes to the Interim Condensed Consolidated Financial Statements. The accompanying interim condensed consolidated financial statements are unaudited and reflect all adjustments (including normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in conformity with GAAP. Interim results are not necessarily indicative of full year performance. The December 31, 2018 consolidated balance sheet data was derived from audited consolidated financial statements included in Brighthouse Financial, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 Annual Report”), which include all disclosures required by GAAP. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the consolidated and combined financial statements of the Company included in the 2018 Annual Report. Adoption of New Accounting Pronouncements Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are not expected to have a material impact on the Company’s financial statements. There were no ASUs adopted during 2019 that had a material impact on the Company’s financial statements. ASUs issued but not yet adopted as of September 30, 2019 are summarized in the table below. Standard Description Effective Date Impact on Financial Statements ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract The amendments to Topic 350 require the capitalization of certain implementation costs incurred in a cloud computing arrangement that is a service contract, resulting in changes to the timing of the costs’ recognition. The requirements align with the existing requirements to capitalize implementation costs incurred to develop or obtain internal-use software. January 1, 2020 using the prospective method or retrospective method (with early adoption permitted) Effective January 1, 2020, the Company will adopt this guidance using the prospective method. As a result, no transition impact will be recognized on adoption. ASU 2018-12, Financial Services-Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts The amendments to Topic 944 will result in significant changes to the accounting for long-duration insurance contracts. These changes (1) require all guarantees that qualify as market risk benefits to be measured at fair value, (2) require more frequent updating of assumptions and modify existing discount rate requirements for certain insurance liabilities, (3) modify the methods of amortization for deferred acquisition costs (“DAC”), and (4) require new qualitative and quantitative disclosures around insurance contract asset and liability balances and the judgments, assumptions and methods used to measure those balances. The market risk benefit guidance is required to be applied on a retrospective basis, while the changes to guidance for insurance liabilities and DAC may be applied to existing carrying amounts on the effective date or on a retrospective basis. The amendments were originally effective on January 1, 2021. On October 16, 2019, the FASB voted to change the effective date of the ASU to January 1, 2022. The Company is in the early stages of evaluating the new guidance and therefore is unable to estimate the impact to its financial statements. The most significant impact will be the measurement of liabilities for variable annuity guarantees. ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The amendments to Topic 326 replace the incurred loss impairment methodology for certain financial instruments with one that reflects expected credit losses based on historical loss information, current conditions, and reasonable and supportable forecasts. The new guidance also requires that an other-than- temporary impairment (“OTTI”) on a debt security will be recognized as an allowance going forward, such that improvements in expected future cash flows after an impairment will no longer be reflected as a prospective yield adjustment through net investment income, but rather a reversal of the previous impairment and recognized through realized investment gains and losses. January 1, 2020 using the modified retrospective method (with early adoption permitted beginning January 1, 2019) The Company expects to reduce retained earnings upon adoption due to an increase in its allowance for credit losses; the amount is not expected to be material. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | 2. Segment Information The Company is organized into three segments: Annuities; Life; and Run-off. In addition, the Company reports certain of its results of operations in Corporate & Other. Annuities The Annuities segment consists of a variety of variable, fixed, index-linked and income annuities designed to address contract holders’ needs for protected wealth accumulation on a tax-deferred basis, wealth transfer and income security. Life The Life segment consists of insurance products and services, including term, universal, whole and variable life products designed to address policyholders’ needs for financial security and protected wealth transfer, which may be provided on a tax-advantaged basis. Run-off The Run-off segment consists of products no longer actively sold and which are separately managed, including structured settlements, pension risk transfer contracts, certain company-owned life insurance policies, funding agreements and universal life with secondary guarantees. Corporate & Other Corporate & Other contains the excess capital not allocated to the segments and interest expense related to the majority of the Company’s outstanding debt, as well as expenses associated with certain legal proceedings and income tax audit issues. Corporate & Other also includes the elimination of intersegment amounts, long-term care and workers’ compensation business reinsured through 100% quota share reinsurance agreements, and term life insurance sold direct to consumers, which is no longer being offered for new sales. Financial Measures and Segment Accounting Policies Adjusted earnings is a financial measure used by management to evaluate performance, allocate resources and facilitate comparisons to industry results. Consistent with GAAP guidance for segment reporting, adjusted earnings is also used to measure segment performance. The Company believes the presentation of adjusted earnings, as the Company measures it for management purposes, enhances the understanding of its performance by the investor community. Adjusted earnings should not be viewed as a substitute for net income (loss) available to BHF’s common shareholders and excludes net income (loss) attributable to noncontrolling interests and preferred stock dividends. Adjusted earnings, which may be positive or negative, focuses on the Company’s primary businesses principally by excluding the impact of market volatility, which could distort trends. The following are significant items excluded from total revenues, net of income tax, in calculating adjusted earnings: • Net investment gains (losses); • Net derivative gains (losses) except earned income on derivatives and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment; and • Certain variable annuity guaranteed minimum income benefits (“GMIBs”) fees (“GMIB Fees”) and amortization of unearned revenue related to net investment gains (losses) and net derivative gains (losses). The following are significant items excluded from total expenses, net of income tax, in calculating adjusted earnings: • Amounts associated with benefits related to GMIBs (“GMIB Costs”); • Amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and market value adjustments associated with surrenders or terminations of contracts (“Market Value Adjustments”); and • Amortization of DAC and value of business acquired (“VOBA”) related to: (i) net investment gains (losses), (ii) net derivative gains (losses), (iii) GMIB Fees and GMIB Costs and (iv) Market Value Adjustments. The tax impact of the adjustments mentioned above is calculated net of the statutory tax rate, which could differ from the Company’s effective tax rate. The segment accounting policies are the same as those used to prepare the Company’s condensed consolidated financial statements, except for the adjustments to calculate adjusted earnings described above. In addition, segment accounting policies include the methods of capital allocation described below. Segment investment and capitalization targets are based on statutory oriented risk principles and metrics. Segment invested assets backing liabilities are based on net statutory liabilities plus excess capital. For the variable annuity business, the excess capital held is based on the target statutory total asset requirement consistent with the Company’s variable annuity risk management strategy. For insurance businesses other than variable annuities, excess capital held is based on a percentage of required statutory risk-based capital. Assets in excess of those allocated to the segments, if any, are held in Corporate & Other. Segment net investment income reflects the performance of each segment’s respective invested assets. Set forth in the tables below are the operating results with respect to the Company’s segments, as well as Corporate & Other, for the three months and nine months ended September 30, 2019 and 2018 . Operating Results Three Months Ended September 30, 2019 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 255 $ 91 $ (543 ) $ (67 ) $ (264 ) Provision for income tax expense (benefit) 52 18 (117 ) (57 ) (104 ) Post-tax adjusted earnings 203 73 (426 ) (10 ) (160 ) Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 9 9 Adjusted earnings $ 203 $ 73 $ (426 ) $ (19 ) (169 ) Adjustments for: Net investment gains (losses) 27 Net derivative gains (losses) 1,057 Other adjustments to net income (16 ) Provision for income tax (expense) benefit (223 ) Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 676 Interest revenue $ 461 $ 117 $ 327 $ 23 Interest expense $ — $ — $ — $ 49 Operating Results Three Months Ended September 30, 2018 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 487 $ 78 $ (134 ) $ (117 ) $ 314 Provision for income tax expense (benefit) 86 17 (29 ) (32 ) 42 Post-tax adjusted earnings 401 61 (105 ) (85 ) 272 Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 2 2 Adjusted earnings $ 401 $ 61 $ (105 ) $ (87 ) 270 Adjustments for: Net investment gains (losses) (42 ) Net derivative gains (losses) (691 ) Other adjustments to net income 51 Provision for income tax (expense) benefit 141 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ (271 ) Interest revenue $ 399 $ 115 $ 322 $ 16 Interest expense $ — $ — $ — $ 39 Operating Results Nine Months Ended September 30, 2019 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 939 $ 194 $ (587 ) $ (224 ) $ 322 Provision for income tax expense (benefit) 176 38 (127 ) (100 ) (13 ) Post-tax adjusted earnings 763 156 (460 ) (124 ) 335 Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 18 18 Adjusted earnings $ 763 $ 156 $ (460 ) $ (142 ) 317 Adjustments for: Net investment gains (losses) 79 Net derivative gains (losses) (97 ) Other adjustments to net income 16 Provision for income tax (expense) benefit 1 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 316 Interest revenue $ 1,352 $ 330 $ 942 $ 57 Interest expense $ — $ — $ — $ 144 Operating Results Nine Months Ended September 30, 2018 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 1,025 $ 205 $ (79 ) $ (327 ) $ 824 Provision for income tax expense (benefit) 177 41 (18 ) (87 ) 113 Post-tax adjusted earnings 848 164 (61 ) (240 ) 711 Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 5 5 Adjusted earnings $ 848 $ 164 $ (61 ) $ (245 ) 706 Adjustments for: Net investment gains (losses) (121 ) Net derivative gains (losses) (1,337 ) Other adjustments to net income (164 ) Provision for income tax (expense) benefit 339 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ (577 ) Interest revenue $ 1,138 $ 334 $ 979 $ 38 Interest expense $ — $ — $ — $ 113 The following table presents total revenues with respect to the Company’s segments, as well as Corporate & Other: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Annuities $ 1,184 $ 1,160 $ 3,495 $ 3,453 Life 320 346 953 1,054 Run-off 484 536 1,487 1,594 Corporate & Other 47 47 132 112 Adjustments 1,152 (667 ) 181 (1,274 ) Total $ 3,187 $ 1,422 $ 6,248 $ 4,939 The following table presents total assets with respect to the Company’s segments, as well as Corporate & Other, at: September 30, 2019 December 31, 2018 (In millions) Annuities $ 154,811 $ 141,489 Life 20,954 20,449 Run-off 36,080 32,393 Corporate & Other 14,031 11,963 Total $ 225,876 $ 206,294 |
Insurance
Insurance | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Insurance | 3. Insurance Guarantees As discussed in Notes 1 and 3 of the Notes to the Consolidated and Combined Financial Statements included in the 2018 Annual Report, the Company issues variable annuity contracts with guaranteed minimum benefits. Guaranteed minimum accumulation benefits (“GMABs”), the non-life contingent portion of guaranteed minimum withdrawal benefits (“GMWBs”) and certain portions of GMIBs that do not require the policyholder to annuitize are accounted for as embedded derivatives in policyholder account balances and are further discussed in Note 5 . The Company also has universal and variable life insurance contracts with secondary guarantees. Information regarding the Company’s guarantee exposure was as follows at: September 30, 2019 December 31, 2018 In the Event of Death At Annuitization In the Event of Death At Annuitization (Dollars in millions) Annuity Contracts (1), (2) Variable Annuity Guarantees Total account value (3) $ 101,594 $ 58,572 $ 96,865 $ 55,967 Separate account value $ 96,645 $ 57,390 $ 91,837 $ 54,731 Net amount at risk $ 7,393 (4) $ 5,003 (5) $ 11,073 (4) $ 4,128 (5) Average attained age of contract holders 68 years 68 years 68 years 68 years September 30, 2019 December 31, 2018 Secondary Guarantees (Dollars in millions) Universal Life Contracts Total account value (3) $ 6,000 $ 6,099 Net amount at risk (6) $ 71,641 $ 73,131 Average attained age of policyholders 66 years 65 years Variable Life Contracts Total account value (3) $ 3,387 $ 3,230 Net amount at risk (6) $ 21,763 $ 23,004 Average attained age of policyholders 50 years 50 years __________________ (1) The Company’s annuity contracts with guarantees may offer more than one type of guarantee in each contract. Therefore, the amounts listed above may not be mutually exclusive. (2) Includes direct business, but excludes offsets from hedging or reinsurance, if any. Therefore, the net amount at risk presented reflects the economic exposures of living and death benefit guarantees associated with variable annuities, but not necessarily their impact on the Company. See Note 5 of the Notes to the Consolidated and Combined Financial Statements included in the 2018 Annual Report for a discussion of guaranteed minimum benefits which have been reinsured. (3) Includes the contract holder’s investments in the general account and separate account, if applicable. (4) Defined as the death benefit less the total account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date and includes any additional contractual claims associated with riders purchased to assist with covering income taxes payable upon death. (5) Defined as the amount (if any) that would be required to be added to the total account value to purchase a lifetime income stream, based on current annuity rates, equal to the minimum amount provided under the guaranteed benefit. This amount represents the Company’s potential economic exposure to such guarantees in the event all contract holders were to annuitize on the balance sheet date, even though the contracts contain terms that allow annuitization of the guaranteed amount only after the 10th anniversary of the contract, which not all contract holders have achieved. (6) Defined as the guarantee amount less the account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | 4. Investments See Note 1 of the Notes to the Consolidated and Combined Financial Statements included in the 2018 Annual Report for a description of the Company’s accounting policies for investments and Note 6 for information about the fair value hierarchy for investments and the related valuation methodologies. Fixed Maturity Securities Available-for-sale (“AFS”) Fixed Maturity Securities AFS by Sector The following table presents the fixed maturity securities AFS by sector at: September 30, 2019 December 31, 2018 Amortized Gross Unrealized Estimated Amortized Gross Unrealized Estimated Gains Temporary OTTI Gains Temporary OTTI (In millions) Fixed maturity securities: U.S. corporate $ 27,968 $ 3,011 $ 77 $ — $ 30,902 $ 24,312 $ 830 $ 669 $ — $ 24,473 U.S. government and agency 5,518 2,229 1 — 7,746 7,944 1,263 112 — 9,095 RMBS 8,712 511 13 (5 ) 9,215 8,428 246 129 (2 ) 8,547 Foreign corporate 9,089 679 118 — 9,650 8,183 159 316 — 8,026 CMBS 5,241 341 3 — 5,579 5,292 43 88 (1 ) 5,248 State and political subdivision 3,209 780 — — 3,989 3,200 412 15 — 3,597 ABS 1,899 28 10 — 1,917 2,135 13 22 — 2,126 Foreign government 1,479 251 5 — 1,725 1,426 102 32 — 1,496 Total fixed maturity securities $ 63,115 $ 7,830 $ 227 $ (5 ) $ 70,723 $ 60,920 $ 3,068 $ 1,383 $ (3 ) $ 62,608 __________________ (1) Noncredit OTTI losses included in accumulated other comprehensive income (loss) (“AOCI”) in an unrealized gain position are due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. The Company held no non-income producing fixed maturity securities at September 30, 2019 . The Company held non-income producing fixed maturity securities with an estimated fair value of less than $1 million at December 31, 2018 . Maturities of Fixed Maturity Securities The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at September 30, 2019 : Due in One Year or Less Due After One Year Through Five Years Due After Five Years Through Ten Years Due After Ten Years Structured Securities (1) Total Fixed Maturity Securities (In millions) Amortized cost $ 1,957 $ 6,764 $ 12,584 $ 25,958 $ 15,852 $ 63,115 Estimated fair value $ 1,963 $ 6,959 $ 13,422 $ 31,668 $ 16,711 $ 70,723 __________________ (1) Structured securities include residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”) and asset-backed securities (“ABS”) (collectively, “Structured Securities”). Actual maturities may differ from contractual maturities due to the exercise of call or prepayment options. Fixed maturity securities not due at a single maturity date have been presented in the year of final contractual maturity. Structured Securities are shown separately, as they are not due at a single maturity. Continuous Gross Unrealized Losses for Fixed Maturity Securities AFS by Sector The following table presents the estimated fair value and gross unrealized losses of fixed maturity securities AFS in an unrealized loss position, aggregated by sector and by length of time that the securities have been in a continuous unrealized loss position at: September 30, 2019 December 31, 2018 Less than 12 Months Equal to or Greater than 12 Months Less than 12 Months Equal to or Greater than 12 Months Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses (Dollars in millions) Fixed maturity securities: U.S. corporate $ 1,621 $ 43 $ 414 $ 34 $ 10,584 $ 470 $ 2,328 $ 199 U.S. government and agency 106 1 — — 412 8 1,543 104 RMBS 536 3 453 5 1,627 26 2,611 101 Foreign corporate 832 28 642 90 3,982 203 774 113 CMBS 102 1 190 2 2,317 53 803 34 State and political subdivision 15 — 8 — 346 7 158 8 ABS 449 3 504 7 1,422 21 70 1 Foreign government 52 5 — — 521 26 132 6 Total fixed maturity securities $ 3,713 $ 84 $ 2,211 $ 138 $ 21,211 $ 814 $ 8,419 $ 566 Total number of securities in an unrealized loss position 693 320 3,027 1,028 Evaluation of AFS Securities for OTTI and Evaluating Temporarily Impaired AFS Securities Evaluation and Measurement Methodologies Management considers a wide range of factors about the security issuer and uses its best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for near-term recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. Considerations used in the impairment evaluation process include, but are not limited to: (i) the length of time and the extent to which the estimated fair value has been below amortized cost; (ii) the potential for impairments when the issuer is experiencing significant financial difficulties; (iii) the potential for impairments in an entire industry sector or sub-sector; (iv) the potential for impairments in certain economically depressed geographic locations; (v) the potential for impairments where the issuer, series of issuers or industry has suffered a catastrophic loss or has exhausted natural resources; (vi) whether the Company has the intent to sell or will more likely than not be required to sell a particular security before the decline in estimated fair value below amortized cost recovers; (vii) with respect to Structured Securities, changes in forecasted cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security; (viii) the potential for impairments due to weakening of foreign currencies on non-functional currency denominated fixed maturity securities that are near maturity; and (ix) other subjective factors, including concentrations and information obtained from regulators and rating agencies. For securities in an unrealized loss position, an OTTI is recognized in earnings when it is anticipated that the amortized cost will not be recovered. When either: (i) the Company has the intent to sell the security; or (ii) it is more likely than not that the Company will be required to sell the security before recovery, the OTTI recognized in earnings is the entire difference between the security’s amortized cost and estimated fair value. If neither of these conditions exists, the difference between the amortized cost of the security and the present value of projected future cash flows expected to be collected is recognized as an OTTI in earnings (“credit loss”). If the estimated fair value is less than the present value of projected future cash flows expected to be collected, this portion of OTTI related to other-than-credit factors (“noncredit loss”) is recorded in other comprehensive income (“OCI”). Current Period Evaluation Based on the Company’s current evaluation of its AFS securities in an unrealized loss position in accordance with its impairment policy, and the Company’s current intentions and assessments (as applicable to the type of security) about holding, selling and any requirements to sell these securities, the Company concluded that these securities were not other-than-temporarily impaired at September 30, 2019 . Gross unrealized losses on fixed maturity securities decreased $1.2 billion during the nine months ended September 30, 2019 to $222 million . The decrease in gross unrealized losses for the nine months ended September 30, 2019 was primarily attributable to decreasing longer-term interest rates and narrowing credit spreads. At September 30, 2019 , $11 million of the total $222 million of gross unrealized losses were from eleven fixed maturity securities with an unrealized loss position of 20% or more of amortized cost for six months or greater. Mortgage Loans Mortgage Loans by Portfolio Segment Mortgage loans are summarized as follows at: September 30, 2019 December 31, 2018 Carrying Value % of Total Carrying Value % of Total (Dollars in millions) Mortgage loans: Commercial $ 9,473 61.7 % $ 8,529 62.3 % Agricultural 3,291 21.4 2,946 21.5 Residential 2,659 17.3 2,276 16.6 Subtotal (1) 15,423 100.4 13,751 100.4 Valuation allowances (2) (64 ) (0.4 ) (57 ) (0.4 ) Total mortgage loans, net $ 15,359 100.0 % $ 13,694 100.0 % __________________ (1) Purchases of mortgage loans from third parties were $159 million and $722 million for the three months and nine months ended September 30, 2019 , respectively, and $816 million and $1.4 billion for the three months and nine months ended September 30, 2018 , respectively, and were primarily comprised of residential mortgage loans. (2) The valuation allowances were primarily from collective evaluation (non-specific loan related). Information on commercial, agricultural and residential mortgage loans is presented in the tables below. Valuation Allowance Methodology Mortgage loans are considered to be impaired when it is probable that, based upon current information and events, the Company will be unable to collect all amounts due under the loan agreement. Specific valuation allowances are established using the same methodology for all three portfolio segments as the excess carrying value of a loan over either (i) the present value of expected future cash flows discounted at the loan’s original effective interest rate, (ii) the estimated fair value of the loan’s underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan’s observable market price. A common evaluation framework is used for establishing non-specific valuation allowances for all loan portfolio segments; however, a separate non-specific valuation allowance is calculated and maintained for each loan portfolio segment that is based on inputs unique to each loan portfolio segment. Non-specific valuation allowances are established for pools of loans with similar risk characteristics where a property-specific or market-specific risk has not been identified, but for which the Company expects to incur a credit loss. These evaluations are based upon several loan portfolio segment-specific factors, including the Company’s experience for loan losses, defaults and loss severity, and loss expectations for loans with similar risk characteristics. These evaluations are revised as conditions change and new information becomes available. Credit Quality of Commercial Mortgage Loans The credit quality of commercial mortgage loans was as follows at: Recorded Investment Debt Service Coverage Ratios % of Total Estimated Fair Value % of Total > 1.20x 1.00x - 1.20x < 1.00x Total (Dollars in millions) September 30, 2019 Loan-to-value ratios: Less than 65% $ 8,355 $ 128 $ 141 $ 8,624 91.0 % $ 9,111 91.2 % 65% to 75% 684 18 — 702 7.4 729 7.3 76% to 80% 138 — 9 147 1.6 146 1.5 Total $ 9,177 $ 146 $ 150 $ 9,473 100.0 % $ 9,986 100.0 % December 31, 2018 Loan-to-value ratios: Less than 65% $ 7,470 $ 89 $ 34 $ 7,593 89.0 % $ 7,668 89.0 % 65% to 75% 762 — 24 786 9.2 798 9.3 76% to 80% 141 — 9 150 1.8 145 1.7 Total $ 8,373 $ 89 $ 67 $ 8,529 100.0 % $ 8,611 100.0 % Credit Quality of Agricultural Mortgage Loans The credit quality of agricultural mortgage loans was as follows at: September 30, 2019 December 31, 2018 Recorded Investment % of Total Recorded Investment % of Total (Dollars in millions) Loan-to-value ratios: Less than 65% $ 3,046 92.6 % $ 2,623 89.0 % 65% to 75% 243 7.3 322 10.9 76% to 80% 2 0.1 1 0.1 Total $ 3,291 100.0 % $ 2,946 100.0 % The estimated fair value of agricultural mortgage loans was $3.4 billion and $2.9 billion at September 30, 2019 and December 31, 2018 , respectively. Credit Quality of Residential Mortgage Loans The credit quality of residential mortgage loans was as follows at: September 30, 2019 December 31, 2018 Recorded Investment % of Total Recorded Investment % of Total (Dollars in millions) Performance indicators: Performing $ 2,621 98.6 % $ 2,240 98.4 % Nonperforming 38 1.4 36 1.6 Total $ 2,659 100.0 % $ 2,276 100.0 % The estimated fair value of residential mortgage loans was $2.7 billion and $2.3 billion at September 30, 2019 and December 31, 2018 , respectively. Past Due, Nonaccrual and Modified Mortgage Loans T h e Company has a high quality, well performing mortgage loan portfolio, with over 99% of all mortgage loans classified as performing at both September 30, 2019 and December 31, 2018 . The Company defines delinquency consistent with industry practice, when mortgage loans are past due as follows: commercial and residential mortgage loans — 60 days and agricultural mortgage loans — 90 days. The Company had no commercial mortgage loans past due or in nonaccrual status at either September 30, 2019 or December 31, 2018 . Agricultural mortgage loans past due totaled $7 million and less than $1 million at September 30, 2019 and December 31, 2018 , respectively. The Company had no agricultural mortgage loans in nonaccrual status at either September 30, 2019 or December 31, 2018 . Residential mortgage loans past due and in nonaccrual status totaled $38 million and $36 million at September 30, 2019 and December 31, 2018 , respectively. During the three months and nine months ended September 30, 2019 and 2018, the Company did not have a significant number of mortgage loans modified in a troubled debt restructuring. Other Invested Assets Freestanding derivatives with positive estimated fair values comprise over 90% of other invested assets. See Note 5 for information about freestanding derivatives with positive estimated fair values. Other invested assets also includes tax credit and renewable energy partnerships, leveraged leases and Federal Home Loan Bank stock. Net Unrealized Investment Gains (Losses) Unrealized investment gains (losses) on fixed maturity securities and the effect on DAC, VOBA, deferred sales inducements (“DSI”) and future policy benefits, that would result from the realization of the unrealized gains (losses), are included in net unrealized investment gains (losses) in AOCI. The components of net unrealized investment gains (losses), included in AOCI, were as follows: September 30, 2019 December 31, 2018 (In millions) Fixed maturity securities $ 7,608 $ 1,691 Derivatives 416 264 Other (14 ) (13 ) Subtotal 8,010 1,942 Amounts allocated from: Future policy benefits (3,050 ) (886 ) DAC, VOBA and DSI (386 ) (90 ) Subtotal (3,436 ) (976 ) Deferred income tax benefit (expense) (961 ) (203 ) Net unrealized investment gains (losses) $ 3,613 $ 763 The changes in net unrealized investment gains (losses) were as follows: Nine Months Ended (In millions) Balance, December 31, 2018 $ 763 Unrealized investment gains (losses) during the period 6,068 Unrealized investment gains (losses) relating to: Future policy benefits (2,164 ) DAC, VOBA and DSI (296 ) Deferred income tax benefit (expense) (758 ) Balance, September 30, 2019 $ 3,613 Change in net unrealized investment gains (losses) $ 2,850 Concentrations of Credit Risk There were no investments in any counterparty that were greater than 10% of the Company’s equity, other than the U.S. government and its agencies, at both September 30, 2019 and December 31, 2018 . Securities Lending Elements of the securities lending program are presented below at: September 30, 2019 December 31, 2018 (In millions) Securities on loan: (1) Amortized cost $ 2,055 $ 3,056 Estimated fair value $ 3,214 $ 3,628 Cash collateral received from counterparties (2) $ 3,244 $ 3,646 Security collateral received from counterparties (3) $ 35 $ 55 Reinvestment portfolio — estimated fair value $ 3,354 $ 3,658 __________________ (1) Included within fixed maturity securities. (2) Included within payables for collateral under securities loaned and other transactions. (3) Security collateral received from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected on the consolidated financial statements. The cash collateral liability by loaned security type and remaining tenor of the agreements were as follows at: September 30, 2019 December 31, 2018 Remaining Tenor of Securities Lending Agreements Remaining Tenor of Securities Lending Agreements Open (1) 1 Month or Less 1 to 6 Months Total Open (1) 1 Month or Less 1 to 6 Months Total (In millions) U.S. government and agency $ 1,561 $ 1,283 $ 400 $ 3,244 $ 1,474 $ 1,823 $ 349 $ 3,646 __________________ (1) The related loaned security could be returned to the Company on the next business day which would require the Company to immediately return the cash collateral. If the Company is required to return significant amounts of cash collateral on short notice and is forced to sell securities to meet the return obligation, it may have difficulty selling such collateral that is invested in securities in a timely manner, be forced to sell securities in a volatile or illiquid market for less than what otherwise would have been realized under normal market conditions, or both. The estimated fair value of the securities on loan related to the cash collateral on open at September 30, 2019 was $1.5 billion , all of which were U.S. government and agency securities which, if put back to the Company, could be immediately sold to satisfy the cash requirement. The reinvestment portfolio acquired with the cash collateral consisted principally of fixed maturity securities (including agency RMBS, U.S. and foreign corporate securities, ABS, non-agency RMBS and U.S. government and agency securities) with 55% invested in agency RMBS, cash and cash equivalents and U.S. government and agency securities at September 30, 2019 Invested Assets on Deposit, Held in Trust and Pledged as Collateral Invested assets on deposit, held in trust and pledged as collateral are presented below at estimated fair value at: September 30, 2019 December 31, 2018 (In millions) Invested assets on deposit (regulatory deposits) (1) $ 9,443 $ 8,176 Invested assets held in trust (reinsurance agreements) (2) 4,429 3,455 Invested assets pledged as collateral (3) 3,471 3,341 Total invested assets on deposit, held in trust and pledged as collateral $ 17,343 $ 14,972 __________________ (1) The Company has assets, primarily fixed maturity securities, on deposit with governmental authorities relating to certain policyholder liabilities, of which $75 million and $55 million of the assets on deposit balance represents restricted cash at September 30, 2019 and December 31, 2018 , respectively. (2) The Company has assets, primarily fixed maturity securities, held in trust relating to certain reinsurance transactions. $132 million and $87 million of the assets held in trust balance represents restricted cash at September 30, 2019 and December 31, 2018 , respectively. (3) The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Note 3 of the Notes to the Consolidated and Combined Financial Statements included in the 2018 Annual Report) and derivative transactions (see Note 5 ). See “— Securities Lending” for information regarding securities on loan. Variable Interest Entities The Company has invested in legal entities that are variable interest entities (“VIEs”). VIEs are consolidated when the investor is the primary beneficiary. A primary beneficiary is the variable interest holder in a VIE with both the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and the obligation to absorb losses, or the right to receive benefits that could potentially be significant to the VIE. There were no material VIEs for which the Company has concluded that it is the primary beneficiary at September 30, 2019 or December 31, 2018 . The Company’s investments in unconsolidated VIEs are described below. Fixed Maturity Securities The Company invests in U.S. corporate bonds, foreign corporate bonds, and Structured Securities issued by VIEs. The Company is not obligated to provide any financial or other support to these VIEs, other than the original investment. The Company’s involvement with these entities is limited to that of a passive investor. The Company has no unilateral right to appoint or remove the servicer, special servicer, or investment manager, which are generally viewed as having the power to direct the activities that most significantly impact the economic performance of the VIE, nor does the Company function in any of these roles. The Company does not have the obligation to absorb losses or the right to receive benefits from the entity that could potentially be significant to the entity; as a result, the Company has determined it is not the primary beneficiary, or consolidator, of the VIE. The Company’s maximum exposure to loss on these fixed maturity securities is limited to the amortized cost of these investments. See “— Fixed Maturity Securities AFS” for information on these securities. Limited Partnerships and LLCs The Company holds investments in certain limited partnerships and LLCs which are VIEs. These ventures include real estate limited partnerships/LLCs, private equity funds, hedge funds, and to a lesser extent tax credit and renewable energy partnerships. The Company is not considered the primary beneficiary, or consolidator, when its involvement takes the form of a limited partner interest and is restricted to a role of a passive investor, as a limited partner’s interest does not provide the Company with any substantive kick-out or participating rights, nor does it provide the Company with the power to direct the activities of the fund. The Company’s maximum exposure to loss on these investments is limited to: (i) the amount invested in debt or equity of the VIE and (ii) commitments to the VIE, as described in Note 11 . The carrying amount and maximum exposure to loss related to the VIEs in which the Company concluded that it holds a variable interest, but is not the primary beneficiary, were as follows at: September 30, 2019 December 31, 2018 Carrying Maximum to Loss Carrying Maximum (In millions) Fixed maturity securities $ 13,361 $ 12,592 $ 13,099 $ 13,099 Limited partnerships and LLCs 1,846 3,067 1,756 3,145 Total $ 15,207 $ 15,659 $ 14,855 $ 16,244 Net Investment Income The components of net investment income were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Investment income: Fixed maturity securities $ 665 $ 641 $ 1,997 $ 1,907 Equity securities 2 1 6 5 Mortgage loans 172 138 507 384 Policy loans 18 17 51 67 Real estate limited partnerships and limited liability companies 12 12 32 36 Other limited partnership interests 67 69 143 159 Cash, cash equivalents and short-term investments 30 8 67 21 Other 12 20 31 42 Subtotal 978 906 2,834 2,621 Less: Investment expenses 50 53 153 145 Net investment income $ 928 $ 853 $ 2,681 $ 2,476 Net Investment Gains (Losses) Components of Net Investment Gains (Losses) The components of net investment gains (losses) were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Fixed maturity securities $ 28 $ (34 ) $ 81 $ (138 ) Equity securities 3 (1 ) 14 (5 ) Mortgage loans (1 ) (5 ) (8 ) (12 ) Real estate limited partnerships and limited liability companies — — — 42 Other limited partnership interests (3 ) — (8 ) — Other — (2 ) — (8 ) Total net investment gains (losses) $ 27 $ (42 ) $ 79 $ (121 ) Sales or Disposals of Fixed Maturity Securities Investment gains and losses on sales of securities are determined on a specific identification basis. Proceeds from sales or disposals of fixed maturity securities and the components of fixed maturity securities net investment gains (losses) were as shown in the table below. Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Proceeds $ 1,628 $ 3,091 $ 8,586 $ 8,428 Gross investment gains $ 45 $ 58 $ 218 $ 70 Gross investment losses (17 ) (92 ) (137 ) (208 ) Net investment gains (losses) $ 28 $ (34 ) $ 81 $ (138 ) |
Derivatives
Derivatives | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 5. Derivatives Accounting for Derivatives Freestanding Derivatives Freestanding derivatives are carried on the Company’s balance sheet either as assets within other invested assets or as liabilities within other liabilities at estimated fair value. The Company does not offset the estimated fair value amounts recognized for derivatives executed with the same counterparty under the same master netting agreement. If a derivative is not designated or did not qualify as an accounting hedge, changes in the estimated fair value of the derivative are reported in net derivative gains (losses) except for economic hedges of limited partnerships and LLCs which are presented in net investment income. The Company generally reports cash received or paid for a derivative in the investing activity section of the statement of cash flows except for cash flows of certain derivative options with deferred premiums, which are reported in the financing activity section of the statement of cash flows. Hedge Accounting The Company primarily designates derivatives as a hedge of a forecasted transaction or a variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). When a derivative is designated as a cash flow hedge and is determined to be highly effective, changes in fair value are recorded in OCI and subsequently reclassified into the statement of operations when the Company’s earnings are affected by the variability in cash flows of the hedged item. To qualify for hedge accounting, at the inception of the hedging relationship, the Company formally documents its risk management objective and strategy for undertaking the hedging transaction, as well as its designation of the hedge. In its hedge documentation, the Company sets forth how the hedging instrument is expected to hedge the designated risks related to the hedged item and sets forth the method that will be used to retrospectively and prospectively assess the hedging instrument’s effectiveness. A derivative designated as a hedging instrument must be assessed as being highly effective in offsetting the designated risk of the hedged item. Hedge effectiveness is formally assessed at inception and at least quarterly throughout the life of the designated hedging relationship. The Company discontinues hedge accounting prospectively when: (i) it is determined that the derivative is no longer highly effective in offsetting changes in the estimated fair value or cash flows of a hedged item; (ii) the derivative or hedged item expires, is sold, terminated, or exercised; (iii) it is no longer probable that the hedged forecasted transaction will occur; or (iv) the derivative is de-designated as a hedging instrument. When hedge accounting is discontinued the derivative is carried at its estimated fair value on the balance sheet, with changes in its estimated fair value recognized in the current period as net derivative gains (losses). The changes in estimated fair value of derivatives previously recorded in OCI related to discontinued cash flow hedges are released into the statement of operations when the Company’s earnings are affected by the variability in cash flows of the hedged item. When the hedged item matures or is sold, or the forecasted transaction is not probable of occurring, the Company immediately reclassifies any remaining balances in OCI to net derivative gains (losses). Embedded Derivatives Derivative Strategies The Company maintains an overall risk management strategy that incorporates the use of derivative instruments to minimize its exposure to various market risks, including interest rate, foreign currency exchange rate, credit and equity market. Derivatives are financial instruments with values derived from interest rates, foreign currency exchange rates, credit spreads and/or other financial indices. Derivatives may be exchange-traded or contracted in the over-the-counter (“OTC”) market. Certain of the Company’s OTC derivatives are cleared and settled through central clearing counterparties (“OTC-cleared”), while others are bilateral contracts between two counterparties (“OTC-bilateral”). Interest Rate Derivatives Interest rate swaps: The Company primarily uses interest rate swaps to hedge interest rate exposure in variable annuity products and minimum guarantees embedded in universal life products. Interest rate swaps are used in nonqualifying hedging relationships. Interest rate caps: The Company uses interest rate caps to protect its floating rate liabilities against rises in interest rates above a specified level, and against interest rate exposure arising from mismatches between assets and liabilities. Interest rate caps are used in nonqualifying hedging relationships. Interest rate futures: The Company uses exchange-traded interest rate futures contracts to hedge minimum guarantees embedded in certain variable annuity products offered by the Company. Exchange-traded interest rate futures are used in nonqualifying hedging relationships. Swaptions: The Company uses swaptions to hedge interest rate risk associated with the Company’s variable annuity and universal life products. Swaptions are used in nonqualifying hedging relationships. Swaptions are included in interest rate options. Interest rate forwards: The Company uses interest rate forwards to hedge minimum guarantees embedded in universal life products. Interest rate forwards are used in cash flow and nonqualifying hedging relationships. Foreign Currency Exchange Rate Derivatives Foreign currency swaps: The Company uses foreign currency swaps to convert foreign currency denominated cash flows to U.S. dollars to reduce cash flow fluctuations due to changes in currency exchange rates. Foreign currency swaps are used in cash flow and nonqualifying hedging relationships. Foreign currency forwards: The Company uses foreign currency forwards to hedge currency exposure on its invested assets. Foreign currency forwards are used in nonqualifying hedging relationships. Credit Derivatives Credit default swaps: The Company uses credit default swaps to create synthetic credit investments to replicate credit exposure that is more economically attractive than what is available in the market or otherwise unavailable (written credit protection), or to reduce credit loss exposure on certain assets that the Company owns (purchased credit protection). Credit default swaps are used in nonqualifying hedging relationships. Equity Derivatives Equity futures: The Company uses exchange-traded equity futures to hedge minimum guarantees embedded in certain variable annuity products against adverse changes in equity markets. Exchange-traded equity futures are used in nonqualifying hedging relationships. Equity index options: The Company uses equity index options primarily to hedge minimum guarantees embedded in certain variable annuity products against adverse changes in equity markets. Additionally, the Company uses equity index options to hedge index-linked annuity products against adverse changes in equity markets. Equity index options are used in nonqualifying hedging relationships. Equity total return swaps: The Company uses equity total return swaps to hedge minimum guarantees embedded in certain variable annuity products against adverse changes equity markets. Equity total return swaps are used in nonqualifying hedging relationships. Equity variance swaps: The Company uses equity variance swaps to hedge minimum guarantees embedded in certain variable annuity products offered by the Company. Equity variance swaps are used in nonqualifying hedging relationships. Primary Risks Managed by Derivatives The following table presents the primary underlying risk exposure, gross notional amount, and estimated fair value of the Company’s derivatives, held at: September 30, 2019 December 31, 2018 Primary Underlying Risk Exposure Gross Notional Estimated Fair Value Gross Notional Estimated Fair Value Assets Liabilities Assets Liabilities (In millions) Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate forwards Interest rate $ 460 $ 51 $ — $ — $ — $ — Foreign currency swaps Foreign currency exchange rate 2,737 320 16 2,524 211 30 Total qualifying hedges 3,197 371 16 2,524 211 30 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate swaps Interest rate 8,731 1,049 32 10,747 528 558 Interest rate caps Interest rate 3,350 2 — 3,350 21 — Interest rate futures Interest rate — — — 54 — — Interest rate options Interest rate 27,250 1,771 375 17,168 168 61 Interest rate forwards Interest rate 4,143 241 15 — — — Foreign currency swaps Foreign currency exchange rate 1,078 146 13 1,409 101 18 Foreign currency forwards Foreign currency exchange rate 118 2 — 125 — — Credit default swaps — purchased Credit 12 — — 98 3 — Credit default swaps — written Credit 1,734 31 — 1,820 14 3 Equity futures Equity market — — — 169 — — Equity index options Equity market 46,099 766 1,503 45,815 1,372 1,207 Equity variance swaps Equity market 5,574 95 249 5,574 80 232 Equity total return swaps Equity market 5,037 41 33 3,920 280 3 Total non-designated or nonqualifying derivatives 103,126 4,144 2,220 90,249 2,567 2,082 Embedded derivatives: Ceded guaranteed minimum income benefits Other N/A 303 — N/A 228 — Direct guaranteed minimum benefits Other N/A — 2,391 N/A — 1,642 Direct index-linked annuities Other N/A — 1,566 N/A — 488 Assumed index-linked annuities Other N/A — 316 N/A — 96 Total embedded derivatives N/A 303 4,273 N/A 228 2,226 Total $ 106,323 $ 4,818 $ 6,509 $ 92,773 $ 3,006 $ 4,338 Based on gross notional amounts, a substantial portion of the Company’s derivatives was not designated or did not qualify as part of a hedging relationship at both September 30, 2019 and December 31, 2018 Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) deferred in AOCI (In millions) Three Months Ended September 30, 2019 Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate derivatives $ — $ — $ 1 $ — $ 51 Foreign currency exchange rate derivatives — — 9 — 109 Total cash flow hedges — — 10 — 160 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives 1,657 — — — — Foreign currency exchange rate derivatives 49 (3 ) — — — Credit derivatives 2 — — — — Equity derivatives (18 ) — — — — Embedded derivatives (630 ) — — — — Total non-qualifying hedges 1,060 (3 ) — — — Total $ 1,060 $ (3 ) $ 10 $ — $ 160 Three Months Ended September 30, 2018 Derivatives Designated as Hedging Instruments: Fair value hedges: Interest rate derivatives $ (2 ) $ 2 $ — $ — $ — Total fair value hedges (2 ) 2 — — — Cash flow hedges: Interest rate derivatives 46 — 1 — (3 ) Foreign currency exchange rate derivatives — — 8 — (4 ) Total cash flow hedges 46 — 9 — (7 ) Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives (266 ) — — — — Foreign currency exchange rate derivatives 6 (3 ) — — — Credit derivatives 11 — — — — Equity derivatives (447 ) — — — — Embedded derivatives (38 ) — — (2 ) — Total non-qualifying hedges (734 ) (3 ) — (2 ) — Total $ (690 ) $ (1 ) $ 9 $ (2 ) $ (7 ) Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) deferred in AOCI (In millions) Nine Months Ended September 30, 2019 Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate derivatives $ 28 $ — $ 2 $ — $ 51 Foreign currency exchange rate derivatives 19 (23 ) 26 — 150 Total cash flow hedges 47 (23 ) 28 — 201 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives 2,906 — — — — Foreign currency exchange rate derivatives 71 (6 ) — — — Credit derivatives 32 — — — — Equity derivatives (1,808 ) — — — — Embedded derivatives (1,316 ) — — — — Total non-qualifying hedges (115 ) (6 ) — — — Total $ (68 ) $ (29 ) $ 28 $ — $ 201 Nine Months Ended September 30, 2018 Derivatives Designated as Hedging Instruments: Fair value hedges: Interest rate derivatives $ (12 ) $ 12 $ 1 $ — $ — Total fair value hedges (12 ) 12 1 — — Cash flow hedges: Interest rate derivatives 62 — 4 — (5 ) Foreign currency exchange rate derivatives (1 ) — 19 — 33 Total cash flow hedges 61 — 23 — 28 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives (1,190 ) — — — — Foreign currency exchange rate derivatives 29 (4 ) — — — Credit derivatives 7 — — — — Equity derivatives (904 ) — — — — Embedded derivatives 664 — — (4 ) — Total non-qualifying hedges (1,394 ) (4 ) — (4 ) — Total $ (1,345 ) $ 8 $ 24 $ (4 ) $ 28 At September 30, 2019 and December 31, 2018 , the balance in AOCI associated with cash flow hedges was $416 million and $264 million , respectively. Credit Derivatives In connection with synthetically created credit investment transactions, the Company writes credit default swaps for which it receives a premium to insure credit risk. If a credit event occurs, as defined by the contract, the contract may be cash settled or it may be settled gross by the Company paying the counterparty the specified swap notional amount in exchange for the delivery of par quantities of the referenced credit obligation. The following table presents the estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps at: September 30, 2019 December 31, 2018 Rating Agency Designation of Referenced Credit Obligations (1) Estimated Fair Value of Credit Default Swaps Maximum Amount of Future Payments under Credit Default Swaps Weighted Average Years to Maturity (2) Estimated Fair Value of Credit Default Swaps Maximum Amount of Future Payments under Credit Default Swaps Weighted Average Years to Maturity (2) (Dollars in millions) Aaa/Aa/A $ 9 $ 615 2.4 $ 8 $ 689 2.0 Baa 22 1,119 5.3 3 1,131 5.0 Total $ 31 $ 1,734 4.3 $ 11 $ 1,820 3.9 __________________ (1) The Company has written credit protection on both single name and index references. The rating agency designations are based on availability and the midpoint of the applicable ratings among Moody’s Investors Service, Standard & Poor’s Global Ratings and Fitch Ratings. If no rating is available from a rating agency, then an internally developed rating is used. (2) The weighted average years to maturity of the credit default swaps is calculated based on weighted average gross notional amounts. Counterparty Credit Risk The Company may be exposed to credit-related losses in the event of counterparty nonperformance on derivative instruments. Generally, the credit exposure is the fair value at the reporting date less any collateral received from the counterparty. The Company manages its credit risk by: (i) entering into derivative transactions with creditworthy counterparties governed by master netting agreements; (ii) trading through regulated exchanges and central clearing counterparties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review. See Note 6 for a description of the impact of credit risk on the valuation of derivatives. The estimated fair values of the Company’s net derivative assets and net derivative liabilities after the application of master netting agreements and collateral were as follows at: Gross Amounts Not Offset on the Consolidated Balance Sheets Gross Amount Recognized Financial Instruments (1) Collateral Received/Pledged (2) Net Amount Off-balance Sheet Securities Collateral (3) Net Amount After Securities Collateral (In millions) September 30, 2019 Derivative assets $ 4,575 $ (1,599 ) $ (1,851 ) $ 1,125 $ (1,089 ) $ 36 Derivative liabilities $ 2,232 $ (1,599 ) $ — $ 633 $ (633 ) $ — December 31, 2018 Derivative assets $ 2,833 $ (1,671 ) $ (1,062 ) $ 100 $ (86 ) $ 14 Derivative liabilities $ 2,104 $ (1,671 ) $ — $ 433 $ (433 ) $ — __________________ (1) Represents amounts subject to an enforceable master netting agreement or similar agreement. (2) The amount of cash collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreement. (3) Securities collateral received by the Company is not recorded on the balance sheet. Amounts do not include excess of collateral pledged or received. The Company’s collateral arrangements generally require the counterparty in a net liability position, after considering the effect of netting agreements, to pledge collateral when the amount owed by that counterparty reaches a minimum transfer amount. Certain of these arrangements also include credit contingent provisions which permit the party with positive fair value to terminate the derivative at the current fair value or demand immediate full collateralization from the party in a net liability position, in the event that the financial strength or credit rating of the party in a net liability position falls below a certain level. The following table presents the aggregate estimated fair value of derivatives in a net liability position containing such credit contingent provisions and the aggregate estimated fair value of assets posted as collateral for such instruments. September 30, 2019 December 31, 2018 (In millions) Estimated fair value of derivatives in a net liability position (1) $ 633 $ 433 Estimated Fair Value of Collateral Provided (2): Fixed maturity securities $ 1,250 $ 797 __________________ (1) After taking into consideration the existence of netting agreements. (2) Substantially all of the Company’s collateral arrangements provide for daily posting of collateral for the full value of the derivative contract. As a result, if the credit contingent provisions of derivative contracts in a net liability position were triggered, minimal additional assets would be required to be posted as collateral or needed to settle the instruments immediately. |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value | 6. Fair Value Considerable judgment is often required in interpreting market data to develop estimates of fair value, and the use of different assumptions or valuation methodologies may have a material effect on the estimated fair value amounts. Recurring Fair Value Measurements The assets and liabilities measured at estimated fair value on a recurring basis and their corresponding placement in the fair value hierarchy, are presented below. Investments that do not have a readily determinable fair value and are measured at net asset value (or equivalent) as a practical expedient to estimated fair value are excluded from the fair value hierarchy. September 30, 2019 Fair Value Hierarchy Level 1 Level 2 Level 3 Total Estimated (In millions) Assets Fixed maturity securities: U.S. corporate $ — $ 30,466 $ 436 $ 30,902 U.S. government and agency 1,667 6,079 — 7,746 RMBS — 9,138 77 9,215 Foreign corporate — 9,260 390 9,650 CMBS — 5,545 34 5,579 State and political subdivision — 3,916 73 3,989 ABS — 1,853 64 1,917 Foreign government — 1,725 — 1,725 Total fixed maturity securities 1,667 67,982 1,074 70,723 Equity securities 11 133 4 148 Short-term investments 1,299 686 — 1,985 Derivative assets: (1) Interest rate — 3,114 — 3,114 Foreign currency exchange rate — 455 13 468 Credit — 22 9 31 Equity market — 803 99 902 Total derivative assets — 4,394 121 4,515 Embedded derivatives within asset host contracts (2) — — 303 303 Separate account assets 224 103,704 — 103,928 Total assets $ 3,201 $ 176,899 $ 1,502 $ 181,602 Liabilities Derivative liabilities: (1) Interest rate $ — $ 422 $ — $ 422 Foreign currency exchange rate — 28 1 29 Equity market — 1,534 251 1,785 Total derivative liabilities — 1,984 252 2,236 Embedded derivatives within liability host contracts (2) — — 4,273 4,273 Total liabilities $ — $ 1,984 $ 4,525 $ 6,509 December 31, 2018 Fair Value Hierarchy Level 1 Level 2 Level 3 Total Estimated (In millions) Assets Fixed maturity securities: U.S. corporate $ — $ 24,150 $ 323 $ 24,473 U.S. government and agency 2,722 6,373 — 9,095 RMBS — 8,541 6 8,547 Foreign corporate — 7,617 409 8,026 CMBS — 5,120 128 5,248 State and political subdivision — 3,523 74 3,597 ABS — 2,087 39 2,126 Foreign government — 1,496 — 1,496 Total fixed maturity securities 2,722 58,907 979 62,608 Equity securities 13 124 3 140 Derivative assets: (1) Interest rate — 717 — 717 Foreign currency exchange rate — 301 11 312 Credit — 10 7 17 Equity market — 1,634 98 1,732 Total derivative assets — 2,662 116 2,778 Embedded derivatives within asset host contracts (2) — — 228 228 Separate account assets 217 98,038 1 98,256 Total assets $ 2,952 $ 159,731 $ 1,327 $ 164,010 Liabilities Derivative liabilities: (1) Interest rate $ — $ 619 $ — $ 619 Foreign currency exchange rate — 48 — 48 Credit — 2 1 3 Equity market — 1,205 237 1,442 Total derivative liabilities — 1,874 238 2,112 Embedded derivatives within liability host contracts (2) — — 2,226 2,226 Total liabilities $ — $ 1,874 $ 2,464 $ 4,338 __________________ (1) Derivative assets are presented within other invested assets on the consolidated balance sheets and derivative liabilities are presented within other liabilities on the consolidated balance sheets. The amounts are presented gross in the tables above to reflect the presentation on the consolidated balance sheets, but are presented net for purposes of the rollforward in the Fair Value Measurements Using Significant Unobservable Inputs (Level 3) tables. (2) Valuation Controls and Procedures The Company monitors and provides oversight of valuation controls and policies for securities, mortgage loans and derivatives, which are primarily executed by its valuation service providers. The valuation methodologies used to determine fair values prioritize the use of observable market prices and market-based parameters and determines that judgmental valuation adjustments, when applied, are based upon established policies and are applied consistently over time. The valuation methodologies for securities, mortgage loans and derivatives are reviewed on an ongoing basis and revised when necessary. In addition, the Chief Accounting Officer periodically reports to the Audit Committee of Brighthouse Financial’s Board of Directors regarding compliance with fair value accounting standards. The fair value of financial assets and financial liabilities is based on quoted market prices, where available. The Company assesses whether prices received represent a reasonable estimate of fair value through controls designed to ensure valuations represent an exit price. Valuation service providers perform several controls, including certain monthly controls, which include, but are not limited to, analysis of portfolio returns to corresponding benchmark returns, comparing a sample of executed prices of securities sold to the fair value estimates, reviewing the bid/ask spreads to assess activity, comparing prices from multiple independent pricing services and ongoing due diligence to confirm that independent pricing services use market-based parameters. The process includes a determination of the observability of inputs used in estimated fair values received from independent pricing services or brokers by assessing whether these inputs can be corroborated by observable market data. Independent non-binding broker quotes, also referred to herein as “consensus pricing,” are used for non-significant portion of the portfolio. Prices received from independent brokers are assessed to determine if they represent a reasonable estimate of fair value by considering such pricing relative to the current market dynamics and current pricing for similar financial instruments. Valuation service providers also apply a formal process to challenge any prices received from independent pricing services that are not considered representative of estimated fair value. If prices received from independent pricing services are not considered reflective of market activity or representative of estimated fair value, independent non-binding broker quotations are obtained. If obtaining an independent non-binding broker quotation is unsuccessful, valuation service providers will use the last available price. The Company reviews outputs of the valuation service providers’ controls and performs additional controls, including certain monthly controls, which include but are not limited to, performing balance sheet analytics to assess reasonableness of period to period pricing changes, including any price adjustments. Price adjustments are applied if prices or quotes received from independent pricing services or brokers are not considered reflective of market activity or representative of estimated fair value. The Company did not have significant price adjustments during the nine months ended September 30, 2019 . Determination of Fair Value Fixed Maturity Securities The fair values for actively traded marketable bonds, primarily U.S. government and agency securities, are determined using the quoted market prices and are classified as Level 1 assets. For fixed maturity securities classified as Level 2 assets, fair values are determined using either a market or income approach and are valued based on a variety of observable inputs as described below. U.S. corporate and foreign corporate securities: Fair value is determined using third-party commercial pricing services, with the primary inputs being quoted prices in markets that are not active, benchmark yields, spreads off benchmark yields, new issuances, issuer rating, trades of identical or comparable securities, or duration. Privately-placed securities are valued using the additional key inputs: market yield curve, call provisions, observable prices and spreads for similar public or private securities that incorporate the credit quality and industry sector of the issuer, and delta spread adjustments to reflect specific credit-related issues. U.S. government and agency, state and political subdivision and foreign government securities: Fair value is determined using third-party commercial pricing services, with the primary inputs being quoted prices in markets that are not active, benchmark U.S. Treasury yield or other yields, spread off the U.S. Treasury yield curve for the identical security, issuer ratings and issuer spreads, broker dealer quotes, and comparable securities that are actively traded. Structured Securities: Fair value is determined using third-party commercial pricing services, with the primary inputs being quoted prices in markets that are not active, spreads for actively traded securities, spreads off benchmark yields, expected prepayment speeds and volumes, current and forecasted loss severity, ratings, geographic region, weighted average coupon and weighted average maturity, average delinquency rates and debt service coverage ratios. Other issuance-specific information is also used, including, but not limited to; collateral type, structure of the security, vintage of the loans, payment terms of the underlying asset, payment priority within tranche, and deal performance. Equity Securities and Short-term Investments The fair value for actively traded equity securities and short-term investments are determined using quoted market prices and are classified as Level 1 assets. For financial instruments classified as Level 2 assets or liabilities, fair values are determined using a market approach and are valued based on a variety of observable inputs as described below. Equity securities and short-term investments: Fair value is determined using third-party commercial pricing services, with the primary input being quoted prices in markets that are not active. Derivatives The fair values for exchange-traded derivatives are determined using the quoted market prices and are classified as Level 1 assets. For OTC-bilateral derivatives and OTC-cleared derivatives classified as Level 2 assets or liabilities, fair values are determined using the income approach. Valuations of non-option-based derivatives utilize present value techniques, whereas valuations of option-based derivatives utilize option pricing models which are based on market standard valuation methodologies and a variety of observable inputs. The significant inputs to the pricing models for most OTC-bilateral and OTC-cleared derivatives are inputs that are observable in the market or can be derived principally from, or corroborated by, observable market data. Certain OTC-bilateral and OTC-cleared derivatives may rely on inputs that are significant to the estimated fair value that are not observable in the market or cannot be derived principally from, or corroborated by, observable market data. These unobservable inputs may involve significant management judgment or estimation. Even though unobservable, these inputs are based on assumptions deemed appropriate given the circumstances and management believes they are consistent with what other market participants would use when pricing such instruments. Most inputs for OTC-bilateral and OTC-cleared derivatives are mid-market inputs but, in certain cases, liquidity adjustments are made when they are deemed more representative of exit value. Market liquidity, as well as the use of different methodologies, assumptions and inputs, may have a material effect on the estimated fair values of the Company’s derivatives and could materially affect net income. The credit risk of both the counterparty and the Company are considered in determining the estimated fair value for all OTC-bilateral and OTC-cleared derivatives, and any potential credit adjustment is based on the net exposure by counterparty after taking into account the effects of netting agreements and collateral arrangements. The Company values its OTC-bilateral and OTC-cleared derivatives using standard swap curves which may include a spread to the risk-free rate, depending upon specific collateral arrangements. This credit spread is appropriate for those parties that execute trades at pricing levels consistent with similar collateral arrangements. As the Company and its significant derivative counterparties generally execute trades at such pricing levels and hold sufficient collateral, additional credit risk adjustments are not currently required in the valuation process. The Company’s ability to consistently execute at such pricing levels is in part due to the netting agreements and collateral arrangements that are in place with all of its significant derivative counterparties. An evaluation of the requirement to make additional credit risk adjustments is performed by the Company each reporting period. Embedded Derivatives Embedded derivatives principally include certain direct and ceded variable annuity guarantees and equity crediting rates within index-linked annuity contracts. Embedded derivatives are recorded at estimated fair value with changes in estimated fair value reported in net income. The Company issues certain variable annuity products with guaranteed minimum benefits. GMWBs, GMABs and certain GMIBs contain embedded derivatives, which are measured at estimated fair value separately from the host variable annuity contract, with changes in estimated fair value reported in net derivative gains (losses). These embedded derivatives are classified within policyholder account balances on the consolidated balance sheets. The Company determines the fair value of these embedded derivatives by estimating the present value of projected future benefits minus the present value of projected future fees using actuarial and capital market assumptions including expectations of policyholder behavior. The calculation is based on in-force business and is performed using standard actuarial valuation software which projects future cash flows from the embedded derivative over multiple risk neutral stochastic scenarios using observable risk-free rates. The percentage of fees included in the initial fair value measurement is not updated in subsequent periods. Capital market assumptions, such as risk-free rates and implied volatilities, are based on market prices for publicly traded instruments to the extent that prices for such instruments are observable. Implied volatilities beyond the observable period are extrapolated based on observable implied volatilities and historical volatilities. Actuarial assumptions, including mortality, lapse, withdrawal and utilization, are unobservable and are reviewed at least annually based on actuarial studies of historical experience. The valuation of these guarantee liabilities includes nonperformance risk adjustments and adjustments for a risk margin related to non-capital market inputs. The nonperformance adjustment is determined by taking into consideration publicly available information relating to spreads in the secondary market for BHF’s debt. These observable spreads are then adjusted to reflect the priority of these liabilities and claims paying ability of the issuing insurance subsidiaries as compared to BHF’s overall financial strength. Risk margins are established to capture the non-capital market risks of the instrument which represent the additional compensation a market participant would require to assume the risks related to the uncertainties of such actuarial assumptions as annuitization, premium persistency, partial withdrawal and surrenders. The establishment of risk margins requires the use of significant management judgment, including assumptions of the amount and cost of capital needed to cover the guarantees. The Company issues and assumes through reinsurance index-linked annuities which allow the policyholder to participate in returns from equity indices. The crediting rates associated with these features are embedded derivatives which are measured at estimated fair value separately from the host fixed annuity contract, with changes in estimated fair value reported in net derivative gains (losses). These embedded derivatives are classified within policyholder account balances on the consolidated balance sheets. The estimated fair value of crediting rates associated with index-linked annuities is determined using a combination of an option pricing model and an option-budget approach. The valuation of these embedded derivatives also includes the establishment of a risk margin, as well as changes in nonperformance risk. Transfers Into or Out of Level 3: Assets and liabilities are transferred into Level 3 when a significant input cannot be corroborated with market observable data. This occurs when market activity decreases significantly and underlying inputs cannot be observed, current prices are not available, and/or when there are significant variances in quoted prices, thereby affecting transparency. Assets and liabilities are transferred out of Level 3 when circumstances change such that a significant input can be corroborated with market observable data. This may be due to a significant increase in market activity, a specific event, or one or more significant input(s) becoming observable. Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) The following table presents certain quantitative information about the significant unobservable inputs used in the fair value measurement, and the sensitivity of the estimated fair value to changes in those inputs, for the more significant asset and liability classes measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at: September 30, 2019 December 31, 2018 Impact of Increase in Input on Estimated Valuation Techniques Significant Unobservable Inputs Range Range Embedded derivatives Direct, assumed and ceded guaranteed minimum benefits • Option pricing techniques • Mortality rates 0.02% - 11.31% 0.02% - 11.31% Decrease (1) • Lapse rates 0.25% - 16.00% 0.25% - 16.00% Decrease (2) • Utilization rates 0.00% - 25.00% 0.00% - 25.00% Increase (3) • Withdrawal rates 0.25% - 10.00% 0.25% - 10.00% (4) • Long-term equity volatilities 16.50% - 22.00% 16.50% - 22.00% Increase (5) • Nonperformance risk spread 0.61% - 2.37% 1.91% - 2.66% Decrease (6) ___________________ (1) Mortality rates vary by age and by demographic characteristics such as gender. Range shown reflects the mortality rate for policyholders between 35 and 90 years old, which represents the majority of the business with living benefits. Mortality rate assumptions are set based on company experience and include an assumption for mortality improvement. (2) Range reflects base lapse rates for major product categories for duration 1-20, which represents majority of business with living benefit riders. Base lapse rates are adjusted at the contract level based on a comparison of the actuarially calculated guaranteed values and the current policyholder account value, as well as other factors, such as the applicability of any surrender charges. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse. Lapse rates are also generally assumed to be lower in periods when a surrender charge applies. (3) The utilization rate assumption estimates the percentage of contract holders with a GMIB or lifetime withdrawal benefit who will elect to utilize the benefit upon becoming eligible in a given year. The range shown represents the floor and cap of the GMIB dynamic election rates across varying levels of in-the-money. For lifetime withdrawal guarantee riders, the assumption is that everyone will begin withdrawals once account value reaches zero which is equivalent to a 100% utilization rate. Utilization rates may vary by the type of guarantee, the amount by which the guaranteed amount is greater than the account value, the contract’s withdrawal history and by the age of the policyholder. (4) The withdrawal rate represents the percentage of account balance that any given policyholder will elect to withdraw from the contract each year. The withdrawal rate assumption varies by age and duration of the contract, and also by other factors such as benefit type. For any given contract, withdrawal rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. For GMWBs, any increase (decrease) in withdrawal rates results in an increase (decrease) in the estimated fair value of the guarantees. For GMABs and GMIBs, any increase (decrease) in withdrawal rates results in a decrease (increase) in the estimated fair value. (5) Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available. For any given contract, long-term equity volatility rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. (6) Nonperformance risk spread varies by duration. For any given contract, multiple nonperformance risk spreads will apply, depending on the duration of the cash flow being discounted for purposes of valuing the embedded derivative. The Company does not develop unobservable inputs used in measuring fair value for all other assets and liabilities classified within Level 3; therefore, these are not included in the table above. The other Level 3 assets and liabilities primarily included fixed maturity securities and derivatives. For fixed maturity securities valued based on non-binding broker quotes, an increase (decrease) in credit spreads would result in a higher (lower) fair value. For derivatives valued based on third-party pricing models, an increase (decrease) in credit spreads would generally result in a higher (lower) fair value. The following tables summarize the change of all assets and (liabilities) measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Fixed Maturity Securities Corporate (1) Structured Securities State and Foreign Equity Short-term Net Net Embedded Separate (In millions) Three Months Ended Balance, beginning of period $ 765 $ 108 $ 74 $ — $ 4 $ 6 $ (134 ) $ (3,121 ) $ — Total realized/unrealized gains (losses) included in net income (loss) (5) (6) — — — — — — (2 ) (630 ) — Total realized/unrealized gains (losses) included in AOCI — 1 — — — — 3 — — Purchases (7) 118 61 — — — — — — — Sales (7) (22 ) (6 ) (1 ) — — (6 ) — — — Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (219 ) — Transfers into Level 3 (8) 49 29 — — — — — — — Transfers out of Level 3 (8) (84 ) (18 ) — — — — 2 — — Balance, end of period $ 826 $ 175 $ 73 $ — $ 4 $ — $ (131 ) $ (3,970 ) $ — Three Months Ended Balance, beginning of period $ 1,872 $ 1,268 $ 8 $ — $ 120 $ — $ (284 ) $ (1,241 ) $ 4 Total realized/unrealized gains (losses) included in net income (loss) (5) (6) — 10 2 — (2 ) — (4 ) (40 ) — Total realized/unrealized gains (losses) included in AOCI (44 ) (8 ) (2 ) — — — — — — Purchases (7) 56 287 — — — — — — 1 Sales (7) (51 ) (114 ) (6 ) — — — — — — Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (154 ) — Transfers into Level 3 (8) 20 3 — — 9 — — — — Transfers out of Level 3 (8) (208 ) (172 ) (2 ) — (5 ) — — — (1 ) Balance, end of period $ 1,645 $ 1,274 $ — $ — $ 122 $ — $ (288 ) $ (1,435 ) $ 4 Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2019 (9) $ — $ — $ — $ — $ — $ — $ (2 ) $ (705 ) $ — Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2018 (9) $ — $ 4 $ — $ — $ — $ — $ (4 ) $ (37 ) $ — Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Fixed Maturity Securities Corporate (1) Structured Securities State and Foreign Equity Short-term Net Net Embedded Separate (In millions) Nine Months Ended Balance, beginning of period $ 732 $ 173 $ 74 $ — $ 3 $ — $ (122 ) $ (1,998 ) $ 1 Total realized/unrealized gains (losses) included in net income (loss) (5) (6) — 1 — — — — (10 ) (1,316 ) — Total realized/unrealized gains (losses) included in AOCI 11 3 — — — — 5 — — Purchases (7) 179 75 — — — — — — — Sales (7) (78 ) (24 ) (1 ) — — — — — (1 ) Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (656 ) — Transfers into Level 3 (8) 147 92 — — 1 — — — — Transfers out of Level 3 (8) (165 ) (145 ) — — — — (4 ) — — Balance, end of period $ 826 $ 175 $ 73 $ — $ 4 $ — $ (131 ) $ (3,970 ) $ — Nine Months Ended Balance, beginning of period $ 1,997 $ 1,230 $ — $ 5 $ 124 $ 14 $ (279 ) $ (1,660 ) $ 5 Total realized/unrealized gains (losses) included in net income (loss) (5) (6) 2 21 — — (4 ) — (12 ) 660 — Total realized/unrealized gains (losses) included in AOCI (121 ) (10 ) — — — — — — — Purchases (7) 164 339 — — — — 3 — 1 Sales (7) (184 ) (229 ) — — (3 ) (14 ) — — (1 ) Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (435 ) (1 ) Transfers into Level 3 (8) 20 — — — 10 — — — — Transfers out of Level 3 (8) (233 ) (77 ) — (5 ) (5 ) — — — — Balance, end of period $ 1,645 $ 1,274 $ — $ — $ 122 $ — $ (288 ) $ (1,435 ) $ 4 Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2019 (9) $ — $ 1 $ — $ — $ — $ — $ (11 ) $ (1,531 ) $ — Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2018 (9) $ (1 ) $ 14 $ — $ — $ (4 ) $ — $ (12 ) $ 867 $ — _______________ (1) Comprised of U.S. and foreign corporate securities. (2) Freestanding derivative assets and liabilities are presented net for purposes of the rollforward. (3) Embedded derivative assets and liabilities are presented net for purposes of the rollforward. (4) Investment performance related to separate account assets is fully offset by corresponding amounts credited to contract holders within separate account liabilities. Therefore, such changes in estimated fair value are not recorded in net income (loss). For the purpose of this disclosure, these changes are presented within net investment gains (losses). (5) Amortization of premium/accretion of discount is included within net investment income. Impairments charged to net income (loss) on securities are included in net investment gains (losses). Lapses associated with net embedded derivatives are included in net derivative gains (losses). Substantially all realized/unrealized gains (losses) included in net income (loss) for net derivatives and net embedded derivatives are reported in net derivative gains (losses). (6) Interest and dividend accruals, as well as cash interest coupons and dividends received, are excluded from the rollforward. (7) Items purchased/issued and then sold/settled in the same period are excluded from the rollforward. Fees attributed to embedded derivatives are included in settlements. (8) Gains and losses, in net income (loss) and OCI, are calculated assuming transfers into and/or out of Level 3 occurred at the beginning of the period. Items transferred into and then out of Level 3 in the same period are excluded from the rollforward. (9) Changes in unrealized gains (losses) included in net income (loss) relate to assets and liabilities still held at the end of the respective periods. Substantially all changes in unrealized gains (losses) included in net income (loss) for net derivatives and net embedded derivatives are reported in net derivative gains (losses). Fair Value of Financial Instruments Carried at Other Than Fair Value The following tables provide fair value information for financial instruments that are carried on the balance sheet at amounts other than fair value. These tables exclude the following financial instruments: cash and cash equivalents, accrued investment income, payables for collateral under securities loaned and other transactions and those short-term investments that are not securities and therefore are not included in the three level hierarchy table disclosed in the “— Recurring Fair Value Measurements” section. The estimated fair value of the excluded financial instruments, which are primarily classified in Level 2, approximates carrying value as they are short-term in nature such that the Company believes there is minimal risk of material changes in interest rates or credit quality. All remaining balance sheet amounts excluded from the tables below are not considered financial instruments subject to this disclosure. The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows at: September 30, 2019 Fair Value Hierarchy Carrying Level 1 Level 2 Level 3 Total Estimated Fair Value (In millions) Assets Mortgage loans $ 15,359 $ — $ — $ 16,073 $ 16,073 Policy loans $ 1,332 $ — $ 555 $ 1,094 $ 1,649 Other invested assets $ 63 $ — $ 50 $ 13 $ 63 Premiums, reinsurance and other receivables $ 1,786 $ — $ 47 $ 2,151 $ 2,198 Liabilities Policyholder account balances $ 15,611 $ — $ — $ 15,818 $ 15,818 Long-term debt $ 4,365 $ — $ 3,283 $ 1,000 $ 4,283 Other liabilities $ 862 $ — $ 640 $ 222 $ 862 Separate account liabilities $ 1,126 $ — $ 1,126 $ — $ 1,126 December 31, 2018 Fair Value Hierarchy Carrying Level 1 Level 2 Level 3 Total Estimated Fair Value (In millions) Assets Mortgage loans $ 13,694 $ — $ — $ 13,860 $ 13,860 Policy loans $ 1,421 $ — $ 656 $ 959 $ 1,615 Other invested assets $ 77 $ — $ 64 $ 13 $ 77 Premiums, reinsurance and other receivables $ 1,609 $ — $ 32 $ 1,664 $ 1,696 Liabilities Policyholder account balances $ 15,332 $ — $ — $ 13,861 $ 13,861 Long-term debt $ 3,963 $ — $ 2,758 $ 600 $ 3,358 Other liabilities $ 330 $ — $ 118 $ 212 $ 330 Separate account liabilities $ 1,029 $ — $ 1,029 $ — $ 1,029 |
Long-term Debt
Long-term Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-term Debt | 7. Long-term Debt Revolving Credit Facility On May 7, 2019, BHF entered into an amended and restated revolving credit agreement with respect to a $1.0 billion senior unsecured revolving credit facility (the “2019 Revolving Credit Facility”) scheduled to mature in May 2024, all of which may be used for revolving loans and/or letters of credit . The 2019 Revolving Credit Facility replaced BHF’s former $2.0 billion senior unsecured revolving credit facility, which was scheduled to mature in December 2021. Debt issuance costs incurred related to the 2019 Revolving Credit Facility were not significant. Term Loan Facility On February 1, 2019, BHF entered into a term loan agreement with respect to a $1.0 billion unsecured term loan facility (as amended, the “2019 Term Loan Facility”) scheduled to mature in February 2024. On February 1, 2019, BHF borrowed $1.0 billion under the 2019 Term Loan Facility, terminated its former term loan facility due December 2, 2019 (the “2017 Term Loan Facility”) without penalty and repaid $600 million of borrowings outstanding under the 2017 Term Loan Facility, with the remainder of the proceeds to be used for general corporate purposes. Debt issuance costs incurred related to the 2019 Term Loan Facility were not significant. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Equity | 8. Equity Preferred Stock On March 25, 2019, BHF issued depositary shares, each representing a 1/1,000th ownership interest in a share of BHF’s perpetual 6.600% Series A non-cumulative preferred stock (the “Series A Preferred Stock”) and in the aggregate representing 17,000 shares of Series A Preferred Stock, with a stated amount of $25,000 per share, for aggregate net cash proceeds of $412 million . Dividends, if declared, will accrue and be payable quarterly, in arrears, at an annual rate of 6.600% on the stated amount per share. In connection with the issuance of the depositary shares and the underlying Series A Preferred Stock, BHF incurred $13 million of issuance costs, which have been recorded as a reduction of additional paid-in capital. On May 15, 2019, BHF declared a dividend of $412.50 per share, for a total of $7 million , on the Series A Preferred Stock, which was paid on June 25, 2019 to stockholders of record as of June 10, 2019. On August 15, 2019, BHF declared a dividend of $412.50 per share, for a total of $7 million , on the Series A Preferred Stock, which was paid on September 25, 2019 to stockholders of record as of September 10, 2019. Common Stock Repurchase Program On May 3, 2019, BHF authorized the repurchase of up to an additional $400 million of its common stock. Repurchases made under such authorization may be made through open market purchases, including pursuant to 10b5-1 plans or pursuant to accelerated stock repurchase plans, from time to time at management’s discretion in accordance with applicable federal securities laws. During the three months and nine months ended September 30, 2019 , BHF repurchased 3,401,947 shares and 8,395,371 shares, respectively, of its common stock through open market purchases, pursuant to 10b5-1 plans, for $126 million and $314 million , respectively. At September 30, 2019 , BHF had $181 million remaining under its common stock repurchase program. Accumulated Other Comprehensive Income (Loss) Information regarding changes in the balances of each component of AOCI was as follows: Three Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, June 30, 2019 $ 2,564 $ 181 $ (20 ) $ (23 ) $ 2,702 OCI before reclassifications 970 160 (3 ) — 1,127 Deferred income tax benefit (expense) (204 ) (33 ) — — (237 ) AOCI before reclassifications, net of income tax 3,330 308 (23 ) (23 ) 3,592 Amounts reclassified from AOCI (30 ) (1 ) — — (31 ) Deferred income tax benefit (expense) 6 — — — 6 Amounts reclassified from AOCI, net of income tax (24 ) (1 ) — — (25 ) Balance, September 30, 2019 $ 3,306 $ 307 $ (23 ) $ (23 ) $ 3,567 Three Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, June 30, 2018 $ 690 $ 168 $ (19 ) $ (24 ) $ 815 OCI before reclassifications (310 ) (7 ) (7 ) — (324 ) Deferred income tax benefit (expense) 66 1 1 — 68 AOCI before reclassifications, net of income tax 446 162 (25 ) (24 ) 559 Amounts reclassified from AOCI 38 (47 ) — — (9 ) Deferred income tax benefit (expense) (8 ) 10 — — 2 Amounts reclassified from AOCI, net of income tax 30 (37 ) — — (7 ) Balance, September 30, 2018 $ 476 $ 125 $ (25 ) $ (24 ) $ 552 Nine Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, December 31, 2018 $ 576 $ 187 $ (27 ) $ (20 ) $ 716 OCI before reclassifications 3,515 201 4 (3 ) 3,717 Deferred income tax benefit (expense) (738 ) (42 ) — — (780 ) AOCI before reclassifications, net of income tax 3,353 346 (23 ) (23 ) 3,653 Amounts reclassified from AOCI (59 ) (49 ) — — (108 ) Deferred income tax benefit (expense) 12 10 — — 22 Amounts reclassified from AOCI, net of income tax (47 ) (39 ) — — (86 ) Balance, September 30, 2019 $ 3,306 $ 307 $ (23 ) $ (23 ) $ 3,567 Nine Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, December 31, 2017 $ 1,572 $ 154 $ (24 ) $ (26 ) $ 1,676 Cumulative effect of change in accounting principle, net of income tax (79 ) — — — (79 ) Balance, January 1, 2018 1,493 154 (24 ) (26 ) 1,597 OCI before reclassifications (1,448 ) 28 (1 ) 3 (1,418 ) Deferred income tax benefit (expense) 325 (6 ) — (1 ) 318 AOCI before reclassifications, net of income tax 370 176 (25 ) (24 ) 497 Amounts reclassified from AOCI 138 (65 ) — — 73 Deferred income tax benefit (expense) (32 ) 14 — — (18 ) Amounts reclassified from AOCI, net of income tax 106 (51 ) — — 55 Balance, September 30, 2018 $ 476 $ 125 $ (25 ) $ (24 ) $ 552 __________________ (1) See Note 4 for information on offsets to investments related to future policy benefits, DAC, VOBA and DSI. Information regarding amounts reclassified out of each component of AOCI was as follows: AOCI Components Amounts Reclassified from AOCI Consolidated Statements of Operations and Comprehensive Income (Loss) Locations Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Net unrealized investment gains (losses): Net unrealized investment gains (losses) $ 31 $ (36 ) $ 86 $ (137 ) Net investment gains (losses) Net unrealized investment gains (losses) — — — 1 Net investment income Net unrealized investment gains (losses) (1 ) (2 ) (27 ) (2 ) Net derivative gains (losses) Net unrealized investment gains (losses), before income tax 30 (38 ) 59 (138 ) Income tax (expense) benefit (6 ) 8 (12 ) 32 Net unrealized investment gains (losses), net of income tax 24 (30 ) 47 (106 ) Unrealized gains (losses) on derivatives - cash flow hedges: Interest rate swaps — 15 28 31 Net derivative gains (losses) Interest rate swaps 1 — 2 2 Net investment income Interest rate forwards — 31 — 31 Net derivative gains (losses) Interest rate forwards — 1 — 2 Net investment income Foreign currency swaps — — 19 (1 ) Net derivative gains (losses) Gains (losses) on cash flow hedges, before income tax 1 47 49 65 Income tax (expense) benefit — (10 ) (10 ) (14 ) Gains (losses) on cash flow hedges, net of income tax 1 37 39 51 Total reclassifications, net of income tax $ 25 $ 7 $ 86 $ (55 ) |
Other Revenues and Other Expens
Other Revenues and Other Expenses | 9 Months Ended |
Sep. 30, 2019 | |
Other Income and Expenses [Abstract] | |
Other Revenue and Other Expenses | 9. Other Revenues and Other Expenses Other Revenues The Company has entered into contracts with mutual funds, fund managers, and their affiliates (collectively, the “Funds”) whereby the Company is paid monthly or quarterly fees (“12b-1 fees”) for providing certain services to customers and distributors of the Funds. The 12b-1 fees are generally equal to a fixed percentage of the average daily balance of the customer’s investment in a fund. The percentage is specified in the contract between the Company and the Funds. Payments are generally collected when due and are neither refundable nor able to offset future fees. To earn these fees, the Company performs services such as responding to phone inquiries, maintaining records, providing information to distributors and shareholders about fund performance and providing training to account managers and sales agents. The passage of time reflects the satisfaction of the Company’s performance obligations to the Funds and is used to recognize revenue associated with 12b-1 fees. Other revenues consisted primarily of 12b-1 fees of $84 million and $251 million for the three months and nine months ended September 30, 2019 , respectively, and $91 million and $275 million for the three months and nine months ended September 30, 2018 , respectively, of which substantially all were reported in the Annuities segment. Other Expenses Information on other expenses was as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Compensation $ 76 $ 67 $ 238 $ 220 Contracted services and other labor costs 73 63 185 189 Transition services agreements 64 70 196 215 Establishment costs 13 87 85 190 Premium and other taxes, licenses and fees 15 12 35 55 Separate account fees 123 133 365 401 Volume related costs, excluding compensation, net of DAC capitalization 155 161 472 486 Interest expense on debt 49 39 144 113 Other 43 33 104 105 Total other expenses $ 611 $ 665 $ 1,824 $ 1,974 |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | 10. Earnings Per Common Share The following table sets forth the calculation of earnings per common share: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions, except share and per share data) Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 676 $ (271 ) $ 316 $ (577 ) Weighted average common shares outstanding — basic 110,915,416 119,657,443 114,195,767 119,734,128 Dilutive effect of share-based awards 612,064 — 546,931 — Weighted average common shares outstanding — diluted 111,527,480 119,657,443 114,742,698 119,734,128 Earnings per common share: Basic $ 6.09 $ (2.26 ) $ 2.77 $ (4.82 ) Diluted $ 6.06 $ (2.26 ) $ 2.75 $ (4.82 ) Basic loss per common share equaled diluted loss per common share for the three months and nine months ended September 30, 2018 . The diluted shares were not utilized in the per share calculation for these periods, as the inclusion of such shares would have an antidilutive effect. For the three months and nine months ended September 30, 2019 , weighted average shares used for calculating earnings per diluted common share excludes 196,492 out-of-the-money stock options, as the inclusion of such shares would be antidilutive to the earnings per common share calculation due to the average share price for the three months and nine months ended September 30, 2019 . |
Contingencies, Commitments and
Contingencies, Commitments and Guarantees | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies, Commitments and Guarantees | 11. Contingencies, Commitments and Guarantees Contingencies Litigation The Company is a defendant in a number of litigation matters. In some of the matters, large and/or indeterminate amounts, including punitive and treble damages, are sought. Modern pleading practice in the U.S. permits considerable variation in the assertion of monetary damages or other relief. Jurisdictions may permit claimants not to specify the monetary damages sought or may permit claimants to state only that the amount sought is sufficient to invoke the jurisdiction of the trial court. In addition, jurisdictions may permit plaintiffs to allege monetary damages in amounts well exceeding reasonably possible verdicts in the jurisdiction for similar matters. This variability in pleadings, together with the actual experience of the Company in litigating or resolving through settlement numerous claims over an extended period of time, demonstrates to management that the monetary relief which may be specified in a lawsuit or claim bears little relevance to its merits or disposition value. Due to the vagaries of litigation, the outcome of a litigation matter and the amount or range of potential loss at particular points in time may normally be difficult to ascertain. Uncertainties can include how fact finders will evaluate documentary evidence and the credibility and effectiveness of witness testimony, and how trial and appellate courts will apply the law in the context of the pleadings or evidence presented, whether by motion practice, or at trial or on appeal. Disposition valuations are also subject to the uncertainty of how opposing parties and their counsel will themselves view the relevant evidence and applicable law. The Company establishes liabilities for litigation and regulatory loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. It is possible that some matters could require the Company to pay damages or make other expenditures or establish accruals in amounts that could not be estimated at September 30, 2019 . Matters as to Which an Estimate Can Be Made For some loss contingency matters, the Company is able to estimate a reasonably possible range of loss. For such matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made. As of September 30, 2019 , the Company estimates the aggregate range of reasonably possible losses in excess of amounts accrued for these matters to be $0 to $10 million . Matters as to Which an Estimate Cannot Be Made For other matters, the Company is not currently able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from other parties and investigation of factual allegations, rulings by the court on motions or appeals, analysis by experts, and the progress of settlement negotiations. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation contingencies and updates its accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews . Sales Practices Claims Over the past several years, the Company has faced claims and regulatory inquiries and investigations, alleging improper marketing or sales of individual life insurance policies, annuities or other products. The Company continues to defend vigorously against the claims in these matters. The Company believes adequate provision has been made in its consolidated financial statements for all probable and reasonably estimable losses for sales practices matters. Summary Various litigation, claims and assessments against the Company, in addition to those discussed previously and those otherwise provided for in the Company’s consolidated financial statements, have arisen in the course of the Company’s business, including, but not limited to, in connection with its activities as an insurer, investor and taxpayer. Further, state insurance regulatory authorities and other federal and state authorities regularly make inquiries and conduct investigations concerning the Company’s compliance with applicable insurance and other laws and regulations. It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings. In some of the matters referred to previously, large and/or indeterminate amounts, including punitive and treble damages, are sought. Although, in light of these considerations, it is possible that an adverse outcome in certain cases could have a material effect upon the Company’s financial position, based on information currently known by the Company’s management, in its opinion, the outcomes of such pending investigations and legal proceedings are not likely to have such an effect. However, given the large and/or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect on the Company’s consolidated net income or cash flows in particular quarterly or annual periods. Commitments Mortgage Loan Commitments The Company commits to lend funds under mortgage loan commitments. The amounts of these mortgage loan commitments were $235 million and $492 million at September 30, 2019 and December 31, 2018 , respectively. Commitments to Fund Partnership Investments, Bank Credit Facilities, Bridge Loans and Private Corporate Bond Investments The Company commits to fund partnership investments and to lend funds under bank credit facilities and private corporate bond investments. The amounts of these unfunded commitments were $1.9 billion at both September 30, 2019 and December 31, 2018 . Guarantees In the normal course of its business, the Company has provided certain indemnities, guarantees and commitments to third parties such that it may be required to make payments now or in the future. In the context of acquisition, disposition, investment and other transactions, the Company has provided indemnities and guarantees, including those related to tax, environmental and other specific liabilities and other indemnities and guarantees that are triggered by, among other things, breaches of representations, warranties or covenants provided by the Company. In addition, in the normal course of business, the Company provides indemnifications to counterparties in contracts with triggers similar to the foregoing, as well as for certain other liabilities, such as third-party lawsuits. These obligations are often subject to time limitations that vary in duration, including contractual limitations and those that arise by operation of law, such as applicable statutes of limitation. In some cases, the maximum potential obligation under the indemnities and guarantees is subject to a contractual limitation ranging from less than $1 million to $122 million , with a cumulative maximum of $128 million , while in other cases such limitations are not specified or applicable. Since certain of these obligations are not subject to limitations, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these guarantees in the future. Management believes that it is unlikely the Company will have to make any material payments under these indemnities, guarantees, or commitments. In addition, the Company indemnifies its directors and officers as provided in its charters and by-laws. Also, the Company indemnifies its agents for liabilities incurred as a result of their representation of the Company’s interests. Since these indemnities are generally not subject to limitation with respect to duration or amount, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these indemnities in the future. The Company’s recorded liabilities were $1 million and $2 million at September 30, 2019 and December 31, 2018 , respectively, for indemnities, guarantees and commitments. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 12. Related Party Transactions The following table summarizes income and expense from affiliated transactions with MetLife prior to the MetLife Divestiture (see Note 1 ) for the periods indicated: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Income (1) $ — $ — $ — $ (182 ) Expense (2) $ — $ — $ — $ 133 __________________ (1) Primarily includes the net impact of reinsurance ceded to MetLife. (2) Primarily includes costs incurred with MetLife related to shared services, offset by reinsurance ceded to MetLife. |
Business, Basis of Presentati_2
Business, Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates, Policy [Policy Text Block] | Basis of Presentation The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported on the interim condensed consolidated financial statements. In applying these policies and estimates, management makes subjective and complex judgments that frequently require assumptions about matters that are inherently uncertain. Many of these policies, estimates and related judgments are common in the insurance and financial services industries; others are specific to the Company’s business and operations. Actual results could differ from these estimates. |
Consolidation of Subsidiaries, Policy [Policy Text Block] | Consolidation The accompanying interim condensed consolidated financial statements include the accounts of Brighthouse Financial, as well as partnerships and limited liability companies (“LLCs”) in which the Company has control. Intercompany accounts and transactions have been eliminated. The Company uses the equity method of accounting for investments in limited partnerships and LLCs when it has more than a minor ownership interest or more than a minor influence over the investee’s operations. The Company generally recognizes its share of the investee’s earnings on a three-month lag in instances where the investee’s financial information is not sufficiently timely or when the investee’s reporting period differs from the Company’s reporting period. When the Company has virtually no influence over the investee’s operations, the investment is carried at fair value. Reclassifications Certain amounts in the prior year periods’ interim condensed consolidated financial statements and related footnotes thereto have been reclassified to conform with the 2019 presentation as may be discussed throughout the Notes to the Interim Condensed Consolidated Financial Statements. The accompanying interim condensed consolidated financial statements are unaudited and reflect all adjustments (including normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in conformity with GAAP. Interim results are not necessarily indicative of full year performance. The December 31, 2018 consolidated balance sheet data was derived from audited consolidated financial statements included in Brighthouse Financial, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 Annual Report”), which include all disclosures required by GAAP. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the consolidated and combined financial statements of the Company included in the 2018 Annual Report. |
New Accounting Pronouncements, Policy [Policy Text Block] | Adoption of New Accounting Pronouncements Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are not expected to have a material impact on the Company’s financial statements. There were no ASUs adopted during 2019 that had a material impact on the Company’s financial statements. ASUs issued but not yet adopted as of September 30, 2019 are summarized in the table below. Standard Description Effective Date Impact on Financial Statements ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract The amendments to Topic 350 require the capitalization of certain implementation costs incurred in a cloud computing arrangement that is a service contract, resulting in changes to the timing of the costs’ recognition. The requirements align with the existing requirements to capitalize implementation costs incurred to develop or obtain internal-use software. January 1, 2020 using the prospective method or retrospective method (with early adoption permitted) Effective January 1, 2020, the Company will adopt this guidance using the prospective method. As a result, no transition impact will be recognized on adoption. ASU 2018-12, Financial Services-Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts The amendments to Topic 944 will result in significant changes to the accounting for long-duration insurance contracts. These changes (1) require all guarantees that qualify as market risk benefits to be measured at fair value, (2) require more frequent updating of assumptions and modify existing discount rate requirements for certain insurance liabilities, (3) modify the methods of amortization for deferred acquisition costs (“DAC”), and (4) require new qualitative and quantitative disclosures around insurance contract asset and liability balances and the judgments, assumptions and methods used to measure those balances. The market risk benefit guidance is required to be applied on a retrospective basis, while the changes to guidance for insurance liabilities and DAC may be applied to existing carrying amounts on the effective date or on a retrospective basis. The amendments were originally effective on January 1, 2021. On October 16, 2019, the FASB voted to change the effective date of the ASU to January 1, 2022. The Company is in the early stages of evaluating the new guidance and therefore is unable to estimate the impact to its financial statements. The most significant impact will be the measurement of liabilities for variable annuity guarantees. ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The amendments to Topic 326 replace the incurred loss impairment methodology for certain financial instruments with one that reflects expected credit losses based on historical loss information, current conditions, and reasonable and supportable forecasts. The new guidance also requires that an other-than- temporary impairment (“OTTI”) on a debt security will be recognized as an allowance going forward, such that improvements in expected future cash flows after an impairment will no longer be reflected as a prospective yield adjustment through net investment income, but rather a reversal of the previous impairment and recognized through realized investment gains and losses. January 1, 2020 using the modified retrospective method (with early adoption permitted beginning January 1, 2019) The Company expects to reduce retained earnings upon adoption due to an increase in its allowance for credit losses; the amount is not expected to be material. |
Investments, Policy [Policy Text Block] | Actual maturities may differ from contractual maturities due to the exercise of call or prepayment options. Fixed maturity securities not due at a single maturity date have been presented in the year of final contractual maturity. Structured Securities are shown separately, as they are not due at a single maturity. Maturities of Fixed Maturity Securities Evaluation of AFS Securities for OTTI and Evaluating Temporarily Impaired AFS Securities Evaluation and Measurement Methodologies Management considers a wide range of factors about the security issuer and uses its best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for near-term recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. Considerations used in the impairment evaluation process include, but are not limited to: (i) the length of time and the extent to which the estimated fair value has been below amortized cost; (ii) the potential for impairments when the issuer is experiencing significant financial difficulties; (iii) the potential for impairments in an entire industry sector or sub-sector; (iv) the potential for impairments in certain economically depressed geographic locations; (v) the potential for impairments where the issuer, series of issuers or industry has suffered a catastrophic loss or has exhausted natural resources; (vi) whether the Company has the intent to sell or will more likely than not be required to sell a particular security before the decline in estimated fair value below amortized cost recovers; (vii) with respect to Structured Securities, changes in forecasted cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security; (viii) the potential for impairments due to weakening of foreign currencies on non-functional currency denominated fixed maturity securities that are near maturity; and (ix) other subjective factors, including concentrations and information obtained from regulators and rating agencies. For securities in an unrealized loss position, an OTTI is recognized in earnings when it is anticipated that the amortized cost will not be recovered. When either: (i) the Company has the intent to sell the security; or (ii) it is more likely than not that the Company will be required to sell the security before recovery, the OTTI recognized in earnings is the entire difference between the security’s amortized cost and estimated fair value. If neither of these conditions exists, the difference between the amortized cost of the security and the present value of projected future cash flows expected to be collected is recognized as an OTTI in earnings (“credit loss”). If the estimated fair value is less than the present value of projected future cash flows expected to be collected, this portion of OTTI related to other-than-credit factors (“noncredit loss”) is recorded in other comprehensive income (“OCI”). The Company defines delinquency consistent with industry practice, when mortgage loans are past due as follows: commercial and residential mortgage loans — 60 days and agricultural mortgage loans — 90 days. Past Due, Nonaccrual and Modified Mortgage Loans Valuation Allowance Methodology Mortgage loans are considered to be impaired when it is probable that, based upon current information and events, the Company will be unable to collect all amounts due under the loan agreement. Specific valuation allowances are established using the same methodology for all three portfolio segments as the excess carrying value of a loan over either (i) the present value of expected future cash flows discounted at the loan’s original effective interest rate, (ii) the estimated fair value of the loan’s underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan’s observable market price. A common evaluation framework is used for establishing non-specific valuation allowances for all loan portfolio segments; however, a separate non-specific valuation allowance is calculated and maintained for each loan portfolio segment that is based on inputs unique to each loan portfolio segment. Non-specific valuation allowances are established for pools of loans with similar risk characteristics where a property-specific or market-specific risk has not been identified, but for which the Company expects to incur a credit loss. These evaluations are based upon several loan portfolio segment-specific factors, including the Company’s experience for loan losses, defaults and loss severity, and loss expectations for loans with similar risk characteristics. These evaluations are revised as conditions change and new information becomes available. Variable Interest Entities The Company has invested in legal entities that are variable interest entities (“VIEs”). VIEs are consolidated when the investor is the primary beneficiary. A primary beneficiary is the variable interest holder in a VIE with both the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and the obligation to absorb losses, or the right to receive benefits that could potentially be significant to the VIE. |
Derivatives, Policy [Policy Text Block] | Accounting for Derivatives Freestanding Derivatives Freestanding derivatives are carried on the Company’s balance sheet either as assets within other invested assets or as liabilities within other liabilities at estimated fair value. The Company does not offset the estimated fair value amounts recognized for derivatives executed with the same counterparty under the same master netting agreement. If a derivative is not designated or did not qualify as an accounting hedge, changes in the estimated fair value of the derivative are reported in net derivative gains (losses) except for economic hedges of limited partnerships and LLCs which are presented in net investment income. The Company generally reports cash received or paid for a derivative in the investing activity section of the statement of cash flows except for cash flows of certain derivative options with deferred premiums, which are reported in the financing activity section of the statement of cash flows. Hedge Accounting The Company primarily designates derivatives as a hedge of a forecasted transaction or a variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). When a derivative is designated as a cash flow hedge and is determined to be highly effective, changes in fair value are recorded in OCI and subsequently reclassified into the statement of operations when the Company’s earnings are affected by the variability in cash flows of the hedged item. To qualify for hedge accounting, at the inception of the hedging relationship, the Company formally documents its risk management objective and strategy for undertaking the hedging transaction, as well as its designation of the hedge. In its hedge documentation, the Company sets forth how the hedging instrument is expected to hedge the designated risks related to the hedged item and sets forth the method that will be used to retrospectively and prospectively assess the hedging instrument’s effectiveness. A derivative designated as a hedging instrument must be assessed as being highly effective in offsetting the designated risk of the hedged item. Hedge effectiveness is formally assessed at inception and at least quarterly throughout the life of the designated hedging relationship. The Company discontinues hedge accounting prospectively when: (i) it is determined that the derivative is no longer highly effective in offsetting changes in the estimated fair value or cash flows of a hedged item; (ii) the derivative or hedged item expires, is sold, terminated, or exercised; (iii) it is no longer probable that the hedged forecasted transaction will occur; or (iv) the derivative is de-designated as a hedging instrument. When hedge accounting is discontinued the derivative is carried at its estimated fair value on the balance sheet, with changes in its estimated fair value recognized in the current period as net derivative gains (losses). The changes in estimated fair value of derivatives previously recorded in OCI related to discontinued cash flow hedges are released into the statement of operations when the Company’s earnings are affected by the variability in cash flows of the hedged item. When the hedged item matures or is sold, or the forecasted transaction is not probable of occurring, the Company immediately reclassifies any remaining balances in OCI to net derivative gains (losses). Embedded Derivatives Counterparty Credit Risk The Company may be exposed to credit-related losses in the event of counterparty nonperformance on derivative instruments. Generally, the credit exposure is the fair value at the reporting date less any collateral received from the counterparty. The Company manages its credit risk by: (i) entering into derivative transactions with creditworthy counterparties governed by master netting agreements; (ii) trading through regulated exchanges and central clearing counterparties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting Information, by Segment | Set forth in the tables below are the operating results with respect to the Company’s segments, as well as Corporate & Other, for the three months and nine months ended September 30, 2019 and 2018 . Operating Results Three Months Ended September 30, 2019 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 255 $ 91 $ (543 ) $ (67 ) $ (264 ) Provision for income tax expense (benefit) 52 18 (117 ) (57 ) (104 ) Post-tax adjusted earnings 203 73 (426 ) (10 ) (160 ) Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 9 9 Adjusted earnings $ 203 $ 73 $ (426 ) $ (19 ) (169 ) Adjustments for: Net investment gains (losses) 27 Net derivative gains (losses) 1,057 Other adjustments to net income (16 ) Provision for income tax (expense) benefit (223 ) Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 676 Interest revenue $ 461 $ 117 $ 327 $ 23 Interest expense $ — $ — $ — $ 49 Operating Results Three Months Ended September 30, 2018 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 487 $ 78 $ (134 ) $ (117 ) $ 314 Provision for income tax expense (benefit) 86 17 (29 ) (32 ) 42 Post-tax adjusted earnings 401 61 (105 ) (85 ) 272 Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 2 2 Adjusted earnings $ 401 $ 61 $ (105 ) $ (87 ) 270 Adjustments for: Net investment gains (losses) (42 ) Net derivative gains (losses) (691 ) Other adjustments to net income 51 Provision for income tax (expense) benefit 141 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ (271 ) Interest revenue $ 399 $ 115 $ 322 $ 16 Interest expense $ — $ — $ — $ 39 Operating Results Nine Months Ended September 30, 2019 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 939 $ 194 $ (587 ) $ (224 ) $ 322 Provision for income tax expense (benefit) 176 38 (127 ) (100 ) (13 ) Post-tax adjusted earnings 763 156 (460 ) (124 ) 335 Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 18 18 Adjusted earnings $ 763 $ 156 $ (460 ) $ (142 ) 317 Adjustments for: Net investment gains (losses) 79 Net derivative gains (losses) (97 ) Other adjustments to net income 16 Provision for income tax (expense) benefit 1 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 316 Interest revenue $ 1,352 $ 330 $ 942 $ 57 Interest expense $ — $ — $ — $ 144 Operating Results Nine Months Ended September 30, 2018 Annuities Life Run-off Corporate & Other Total (In millions) Pre-tax adjusted earnings $ 1,025 $ 205 $ (79 ) $ (327 ) $ 824 Provision for income tax expense (benefit) 177 41 (18 ) (87 ) 113 Post-tax adjusted earnings 848 164 (61 ) (240 ) 711 Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends — — — 5 5 Adjusted earnings $ 848 $ 164 $ (61 ) $ (245 ) 706 Adjustments for: Net investment gains (losses) (121 ) Net derivative gains (losses) (1,337 ) Other adjustments to net income (164 ) Provision for income tax (expense) benefit 339 Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ (577 ) Interest revenue $ 1,138 $ 334 $ 979 $ 38 Interest expense $ — $ — $ — $ 113 The following table presents total assets with respect to the Company’s segments, as well as Corporate & Other, at: September 30, 2019 December 31, 2018 (In millions) Annuities $ 154,811 $ 141,489 Life 20,954 20,449 Run-off 36,080 32,393 Corporate & Other 14,031 11,963 Total $ 225,876 $ 206,294 |
Reconciliation of Revenue from Segments to Consolidated | The following table presents total revenues with respect to the Company’s segments, as well as Corporate & Other: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Annuities $ 1,184 $ 1,160 $ 3,495 $ 3,453 Life 320 346 953 1,054 Run-off 484 536 1,487 1,594 Corporate & Other 47 47 132 112 Adjustments 1,152 (667 ) 181 (1,274 ) Total $ 3,187 $ 1,422 $ 6,248 $ 4,939 |
Insurance (Tables)
Insurance (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Insurance [Abstract] | |
Guarantees related to Annuity, Universal and Variable Life Contracts | Information regarding the Company’s guarantee exposure was as follows at: September 30, 2019 December 31, 2018 In the Event of Death At Annuitization In the Event of Death At Annuitization (Dollars in millions) Annuity Contracts (1), (2) Variable Annuity Guarantees Total account value (3) $ 101,594 $ 58,572 $ 96,865 $ 55,967 Separate account value $ 96,645 $ 57,390 $ 91,837 $ 54,731 Net amount at risk $ 7,393 (4) $ 5,003 (5) $ 11,073 (4) $ 4,128 (5) Average attained age of contract holders 68 years 68 years 68 years 68 years September 30, 2019 December 31, 2018 Secondary Guarantees (Dollars in millions) Universal Life Contracts Total account value (3) $ 6,000 $ 6,099 Net amount at risk (6) $ 71,641 $ 73,131 Average attained age of policyholders 66 years 65 years Variable Life Contracts Total account value (3) $ 3,387 $ 3,230 Net amount at risk (6) $ 21,763 $ 23,004 Average attained age of policyholders 50 years 50 years __________________ (1) The Company’s annuity contracts with guarantees may offer more than one type of guarantee in each contract. Therefore, the amounts listed above may not be mutually exclusive. (2) Includes direct business, but excludes offsets from hedging or reinsurance, if any. Therefore, the net amount at risk presented reflects the economic exposures of living and death benefit guarantees associated with variable annuities, but not necessarily their impact on the Company. See Note 5 of the Notes to the Consolidated and Combined Financial Statements included in the 2018 Annual Report for a discussion of guaranteed minimum benefits which have been reinsured. (3) Includes the contract holder’s investments in the general account and separate account, if applicable. (4) Defined as the death benefit less the total account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date and includes any additional contractual claims associated with riders purchased to assist with covering income taxes payable upon death. (5) Defined as the amount (if any) that would be required to be added to the total account value to purchase a lifetime income stream, based on current annuity rates, equal to the minimum amount provided under the guaranteed benefit. This amount represents the Company’s potential economic exposure to such guarantees in the event all contract holders were to annuitize on the balance sheet date, even though the contracts contain terms that allow annuitization of the guaranteed amount only after the 10th anniversary of the contract, which not all contract holders have achieved. (6) Defined as the guarantee amount less the account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Fixed Maturity Securities AFS by Sector | The following table presents the fixed maturity securities AFS by sector at: September 30, 2019 December 31, 2018 Amortized Gross Unrealized Estimated Amortized Gross Unrealized Estimated Gains Temporary OTTI Gains Temporary OTTI (In millions) Fixed maturity securities: U.S. corporate $ 27,968 $ 3,011 $ 77 $ — $ 30,902 $ 24,312 $ 830 $ 669 $ — $ 24,473 U.S. government and agency 5,518 2,229 1 — 7,746 7,944 1,263 112 — 9,095 RMBS 8,712 511 13 (5 ) 9,215 8,428 246 129 (2 ) 8,547 Foreign corporate 9,089 679 118 — 9,650 8,183 159 316 — 8,026 CMBS 5,241 341 3 — 5,579 5,292 43 88 (1 ) 5,248 State and political subdivision 3,209 780 — — 3,989 3,200 412 15 — 3,597 ABS 1,899 28 10 — 1,917 2,135 13 22 — 2,126 Foreign government 1,479 251 5 — 1,725 1,426 102 32 — 1,496 Total fixed maturity securities $ 63,115 $ 7,830 $ 227 $ (5 ) $ 70,723 $ 60,920 $ 3,068 $ 1,383 $ (3 ) $ 62,608 __________________ (1) Noncredit OTTI losses included in accumulated other comprehensive income (loss) (“AOCI”) in an unrealized gain position are due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. |
Maturities of Fixed Maturity Securities | The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at September 30, 2019 : Due in One Year or Less Due After One Year Through Five Years Due After Five Years Through Ten Years Due After Ten Years Structured Securities (1) Total Fixed Maturity Securities (In millions) Amortized cost $ 1,957 $ 6,764 $ 12,584 $ 25,958 $ 15,852 $ 63,115 Estimated fair value $ 1,963 $ 6,959 $ 13,422 $ 31,668 $ 16,711 $ 70,723 __________________ (1) Structured securities include residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”) and asset-backed securities (“ABS”) (collectively, “Structured Securities”). |
Continuous Gross Unrealized Losses for Fixed Maturity Securities AFS by Sector | The following table presents the estimated fair value and gross unrealized losses of fixed maturity securities AFS in an unrealized loss position, aggregated by sector and by length of time that the securities have been in a continuous unrealized loss position at: September 30, 2019 December 31, 2018 Less than 12 Months Equal to or Greater than 12 Months Less than 12 Months Equal to or Greater than 12 Months Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses Estimated Fair Value Gross Unrealized Losses (Dollars in millions) Fixed maturity securities: U.S. corporate $ 1,621 $ 43 $ 414 $ 34 $ 10,584 $ 470 $ 2,328 $ 199 U.S. government and agency 106 1 — — 412 8 1,543 104 RMBS 536 3 453 5 1,627 26 2,611 101 Foreign corporate 832 28 642 90 3,982 203 774 113 CMBS 102 1 190 2 2,317 53 803 34 State and political subdivision 15 — 8 — 346 7 158 8 ABS 449 3 504 7 1,422 21 70 1 Foreign government 52 5 — — 521 26 132 6 Total fixed maturity securities $ 3,713 $ 84 $ 2,211 $ 138 $ 21,211 $ 814 $ 8,419 $ 566 Total number of securities in an unrealized loss position 693 320 3,027 1,028 |
Mortgage Loans by Portfolio Segment | Mortgage loans are summarized as follows at: September 30, 2019 December 31, 2018 Carrying Value % of Total Carrying Value % of Total (Dollars in millions) Mortgage loans: Commercial $ 9,473 61.7 % $ 8,529 62.3 % Agricultural 3,291 21.4 2,946 21.5 Residential 2,659 17.3 2,276 16.6 Subtotal (1) 15,423 100.4 13,751 100.4 Valuation allowances (2) (64 ) (0.4 ) (57 ) (0.4 ) Total mortgage loans, net $ 15,359 100.0 % $ 13,694 100.0 % __________________ (1) Purchases of mortgage loans from third parties were $159 million and $722 million for the three months and nine months ended September 30, 2019 , respectively, and $816 million and $1.4 billion for the three months and nine months ended September 30, 2018 , respectively, and were primarily comprised of residential mortgage loans. (2) The valuation allowances were primarily from collective evaluation (non-specific loan related). |
Credit Quality of Mortgage Loans by Portfolio Segment | The credit quality of commercial mortgage loans was as follows at: Recorded Investment Debt Service Coverage Ratios % of Total Estimated Fair Value % of Total > 1.20x 1.00x - 1.20x < 1.00x Total (Dollars in millions) September 30, 2019 Loan-to-value ratios: Less than 65% $ 8,355 $ 128 $ 141 $ 8,624 91.0 % $ 9,111 91.2 % 65% to 75% 684 18 — 702 7.4 729 7.3 76% to 80% 138 — 9 147 1.6 146 1.5 Total $ 9,177 $ 146 $ 150 $ 9,473 100.0 % $ 9,986 100.0 % December 31, 2018 Loan-to-value ratios: Less than 65% $ 7,470 $ 89 $ 34 $ 7,593 89.0 % $ 7,668 89.0 % 65% to 75% 762 — 24 786 9.2 798 9.3 76% to 80% 141 — 9 150 1.8 145 1.7 Total $ 8,373 $ 89 $ 67 $ 8,529 100.0 % $ 8,611 100.0 % The credit quality of agricultural mortgage loans was as follows at: September 30, 2019 December 31, 2018 Recorded Investment % of Total Recorded Investment % of Total (Dollars in millions) Loan-to-value ratios: Less than 65% $ 3,046 92.6 % $ 2,623 89.0 % 65% to 75% 243 7.3 322 10.9 76% to 80% 2 0.1 1 0.1 Total $ 3,291 100.0 % $ 2,946 100.0 % The credit quality of residential mortgage loans was as follows at: September 30, 2019 December 31, 2018 Recorded Investment % of Total Recorded Investment % of Total (Dollars in millions) Performance indicators: Performing $ 2,621 98.6 % $ 2,240 98.4 % Nonperforming 38 1.4 36 1.6 Total $ 2,659 100.0 % $ 2,276 100.0 % |
Net Unrealized Investment Gains (Losses) | The components of net unrealized investment gains (losses), included in AOCI, were as follows: September 30, 2019 December 31, 2018 (In millions) Fixed maturity securities $ 7,608 $ 1,691 Derivatives 416 264 Other (14 ) (13 ) Subtotal 8,010 1,942 Amounts allocated from: Future policy benefits (3,050 ) (886 ) DAC, VOBA and DSI (386 ) (90 ) Subtotal (3,436 ) (976 ) Deferred income tax benefit (expense) (961 ) (203 ) Net unrealized investment gains (losses) $ 3,613 $ 763 The changes in net unrealized investment gains (losses) were as follows: Nine Months Ended (In millions) Balance, December 31, 2018 $ 763 Unrealized investment gains (losses) during the period 6,068 Unrealized investment gains (losses) relating to: Future policy benefits (2,164 ) DAC, VOBA and DSI (296 ) Deferred income tax benefit (expense) (758 ) Balance, September 30, 2019 $ 3,613 Change in net unrealized investment gains (losses) $ 2,850 |
Securities Lending | Elements of the securities lending program are presented below at: September 30, 2019 December 31, 2018 (In millions) Securities on loan: (1) Amortized cost $ 2,055 $ 3,056 Estimated fair value $ 3,214 $ 3,628 Cash collateral received from counterparties (2) $ 3,244 $ 3,646 Security collateral received from counterparties (3) $ 35 $ 55 Reinvestment portfolio — estimated fair value $ 3,354 $ 3,658 __________________ (1) Included within fixed maturity securities. (2) Included within payables for collateral under securities loaned and other transactions. (3) Security collateral received from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected on the consolidated financial statements. The cash collateral liability by loaned security type and remaining tenor of the agreements were as follows at: September 30, 2019 December 31, 2018 Remaining Tenor of Securities Lending Agreements Remaining Tenor of Securities Lending Agreements Open (1) 1 Month or Less 1 to 6 Months Total Open (1) 1 Month or Less 1 to 6 Months Total (In millions) U.S. government and agency $ 1,561 $ 1,283 $ 400 $ 3,244 $ 1,474 $ 1,823 $ 349 $ 3,646 __________________ (1) The related loaned security could be returned to the Company on the next business day which would require the Company to immediately return the cash collateral. |
Invested Assets on Deposit, Held in Trust and Pledged as Collateral | Invested assets on deposit, held in trust and pledged as collateral are presented below at estimated fair value at: September 30, 2019 December 31, 2018 (In millions) Invested assets on deposit (regulatory deposits) (1) $ 9,443 $ 8,176 Invested assets held in trust (reinsurance agreements) (2) 4,429 3,455 Invested assets pledged as collateral (3) 3,471 3,341 Total invested assets on deposit, held in trust and pledged as collateral $ 17,343 $ 14,972 __________________ (1) The Company has assets, primarily fixed maturity securities, on deposit with governmental authorities relating to certain policyholder liabilities, of which $75 million and $55 million of the assets on deposit balance represents restricted cash at September 30, 2019 and December 31, 2018 , respectively. (2) The Company has assets, primarily fixed maturity securities, held in trust relating to certain reinsurance transactions. $132 million and $87 million of the assets held in trust balance represents restricted cash at September 30, 2019 and December 31, 2018 , respectively. (3) The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Note 3 of the Notes to the Consolidated and Combined Financial Statements included in the 2018 Annual Report) and derivative transactions (see Note 5 ). |
Variable Interest Entities | The carrying amount and maximum exposure to loss related to the VIEs in which the Company concluded that it holds a variable interest, but is not the primary beneficiary, were as follows at: September 30, 2019 December 31, 2018 Carrying Maximum to Loss Carrying Maximum (In millions) Fixed maturity securities $ 13,361 $ 12,592 $ 13,099 $ 13,099 Limited partnerships and LLCs 1,846 3,067 1,756 3,145 Total $ 15,207 $ 15,659 $ 14,855 $ 16,244 |
Components of Net Investment Income | The components of net investment income were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Investment income: Fixed maturity securities $ 665 $ 641 $ 1,997 $ 1,907 Equity securities 2 1 6 5 Mortgage loans 172 138 507 384 Policy loans 18 17 51 67 Real estate limited partnerships and limited liability companies 12 12 32 36 Other limited partnership interests 67 69 143 159 Cash, cash equivalents and short-term investments 30 8 67 21 Other 12 20 31 42 Subtotal 978 906 2,834 2,621 Less: Investment expenses 50 53 153 145 Net investment income $ 928 $ 853 $ 2,681 $ 2,476 |
Components of Net Investment Gains (Losses) | The components of net investment gains (losses) were as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Fixed maturity securities $ 28 $ (34 ) $ 81 $ (138 ) Equity securities 3 (1 ) 14 (5 ) Mortgage loans (1 ) (5 ) (8 ) (12 ) Real estate limited partnerships and limited liability companies — — — 42 Other limited partnership interests (3 ) — (8 ) — Other — (2 ) — (8 ) Total net investment gains (losses) $ 27 $ (42 ) $ 79 $ (121 ) |
Sales or Disposals of Fixed Maturity Securities | Proceeds from sales or disposals of fixed maturity securities and the components of fixed maturity securities net investment gains (losses) were as shown in the table below. Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Proceeds $ 1,628 $ 3,091 $ 8,586 $ 8,428 Gross investment gains $ 45 $ 58 $ 218 $ 70 Gross investment losses (17 ) (92 ) (137 ) (208 ) Net investment gains (losses) $ 28 $ (34 ) $ 81 $ (138 ) |
Derivatives (Tables)
Derivatives (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location | The following table presents the primary underlying risk exposure, gross notional amount, and estimated fair value of the Company’s derivatives, held at: September 30, 2019 December 31, 2018 Primary Underlying Risk Exposure Gross Notional Estimated Fair Value Gross Notional Estimated Fair Value Assets Liabilities Assets Liabilities (In millions) Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate forwards Interest rate $ 460 $ 51 $ — $ — $ — $ — Foreign currency swaps Foreign currency exchange rate 2,737 320 16 2,524 211 30 Total qualifying hedges 3,197 371 16 2,524 211 30 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate swaps Interest rate 8,731 1,049 32 10,747 528 558 Interest rate caps Interest rate 3,350 2 — 3,350 21 — Interest rate futures Interest rate — — — 54 — — Interest rate options Interest rate 27,250 1,771 375 17,168 168 61 Interest rate forwards Interest rate 4,143 241 15 — — — Foreign currency swaps Foreign currency exchange rate 1,078 146 13 1,409 101 18 Foreign currency forwards Foreign currency exchange rate 118 2 — 125 — — Credit default swaps — purchased Credit 12 — — 98 3 — Credit default swaps — written Credit 1,734 31 — 1,820 14 3 Equity futures Equity market — — — 169 — — Equity index options Equity market 46,099 766 1,503 45,815 1,372 1,207 Equity variance swaps Equity market 5,574 95 249 5,574 80 232 Equity total return swaps Equity market 5,037 41 33 3,920 280 3 Total non-designated or nonqualifying derivatives 103,126 4,144 2,220 90,249 2,567 2,082 Embedded derivatives: Ceded guaranteed minimum income benefits Other N/A 303 — N/A 228 — Direct guaranteed minimum benefits Other N/A — 2,391 N/A — 1,642 Direct index-linked annuities Other N/A — 1,566 N/A — 488 Assumed index-linked annuities Other N/A — 316 N/A — 96 Total embedded derivatives N/A 303 4,273 N/A 228 2,226 Total $ 106,323 $ 4,818 $ 6,509 $ 92,773 $ 3,006 $ 4,338 |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The following tables present the amount and location of gains (losses), including earned income, recognized for derivatives and gains (losses) pertaining to hedged items presented in net derivative gains (losses): Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) deferred in AOCI (In millions) Three Months Ended September 30, 2019 Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate derivatives $ — $ — $ 1 $ — $ 51 Foreign currency exchange rate derivatives — — 9 — 109 Total cash flow hedges — — 10 — 160 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives 1,657 — — — — Foreign currency exchange rate derivatives 49 (3 ) — — — Credit derivatives 2 — — — — Equity derivatives (18 ) — — — — Embedded derivatives (630 ) — — — — Total non-qualifying hedges 1,060 (3 ) — — — Total $ 1,060 $ (3 ) $ 10 $ — $ 160 Three Months Ended September 30, 2018 Derivatives Designated as Hedging Instruments: Fair value hedges: Interest rate derivatives $ (2 ) $ 2 $ — $ — $ — Total fair value hedges (2 ) 2 — — — Cash flow hedges: Interest rate derivatives 46 — 1 — (3 ) Foreign currency exchange rate derivatives — — 8 — (4 ) Total cash flow hedges 46 — 9 — (7 ) Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives (266 ) — — — — Foreign currency exchange rate derivatives 6 (3 ) — — — Credit derivatives 11 — — — — Equity derivatives (447 ) — — — — Embedded derivatives (38 ) — — (2 ) — Total non-qualifying hedges (734 ) (3 ) — (2 ) — Total $ (690 ) $ (1 ) $ 9 $ (2 ) $ (7 ) Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) deferred in AOCI (In millions) Nine Months Ended September 30, 2019 Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate derivatives $ 28 $ — $ 2 $ — $ 51 Foreign currency exchange rate derivatives 19 (23 ) 26 — 150 Total cash flow hedges 47 (23 ) 28 — 201 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives 2,906 — — — — Foreign currency exchange rate derivatives 71 (6 ) — — — Credit derivatives 32 — — — — Equity derivatives (1,808 ) — — — — Embedded derivatives (1,316 ) — — — — Total non-qualifying hedges (115 ) (6 ) — — — Total $ (68 ) $ (29 ) $ 28 $ — $ 201 Nine Months Ended September 30, 2018 Derivatives Designated as Hedging Instruments: Fair value hedges: Interest rate derivatives $ (12 ) $ 12 $ 1 $ — $ — Total fair value hedges (12 ) 12 1 — — Cash flow hedges: Interest rate derivatives 62 — 4 — (5 ) Foreign currency exchange rate derivatives (1 ) — 19 — 33 Total cash flow hedges 61 — 23 — 28 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives (1,190 ) — — — — Foreign currency exchange rate derivatives 29 (4 ) — — — Credit derivatives 7 — — — — Equity derivatives (904 ) — — — — Embedded derivatives 664 — — (4 ) — Total non-qualifying hedges (1,394 ) (4 ) — (4 ) — Total $ (1,345 ) $ 8 $ 24 $ (4 ) $ 28 |
Components of Net Derivatives Gains (Losses) | The following tables present the amount and location of gains (losses), including earned income, recognized for derivatives and gains (losses) pertaining to hedged items presented in net derivative gains (losses): Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) deferred in AOCI (In millions) Three Months Ended September 30, 2019 Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate derivatives $ — $ — $ 1 $ — $ 51 Foreign currency exchange rate derivatives — — 9 — 109 Total cash flow hedges — — 10 — 160 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives 1,657 — — — — Foreign currency exchange rate derivatives 49 (3 ) — — — Credit derivatives 2 — — — — Equity derivatives (18 ) — — — — Embedded derivatives (630 ) — — — — Total non-qualifying hedges 1,060 (3 ) — — — Total $ 1,060 $ (3 ) $ 10 $ — $ 160 Three Months Ended September 30, 2018 Derivatives Designated as Hedging Instruments: Fair value hedges: Interest rate derivatives $ (2 ) $ 2 $ — $ — $ — Total fair value hedges (2 ) 2 — — — Cash flow hedges: Interest rate derivatives 46 — 1 — (3 ) Foreign currency exchange rate derivatives — — 8 — (4 ) Total cash flow hedges 46 — 9 — (7 ) Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives (266 ) — — — — Foreign currency exchange rate derivatives 6 (3 ) — — — Credit derivatives 11 — — — — Equity derivatives (447 ) — — — — Embedded derivatives (38 ) — — (2 ) — Total non-qualifying hedges (734 ) (3 ) — (2 ) — Total $ (690 ) $ (1 ) $ 9 $ (2 ) $ (7 ) Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) deferred in AOCI (In millions) Nine Months Ended September 30, 2019 Derivatives Designated as Hedging Instruments: Cash flow hedges: Interest rate derivatives $ 28 $ — $ 2 $ — $ 51 Foreign currency exchange rate derivatives 19 (23 ) 26 — 150 Total cash flow hedges 47 (23 ) 28 — 201 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives 2,906 — — — — Foreign currency exchange rate derivatives 71 (6 ) — — — Credit derivatives 32 — — — — Equity derivatives (1,808 ) — — — — Embedded derivatives (1,316 ) — — — — Total non-qualifying hedges (115 ) (6 ) — — — Total $ (68 ) $ (29 ) $ 28 $ — $ 201 Nine Months Ended September 30, 2018 Derivatives Designated as Hedging Instruments: Fair value hedges: Interest rate derivatives $ (12 ) $ 12 $ 1 $ — $ — Total fair value hedges (12 ) 12 1 — — Cash flow hedges: Interest rate derivatives 62 — 4 — (5 ) Foreign currency exchange rate derivatives (1 ) — 19 — 33 Total cash flow hedges 61 — 23 — 28 Derivatives Not Designated or Not Qualifying as Hedging Instruments: Interest rate derivatives (1,190 ) — — — — Foreign currency exchange rate derivatives 29 (4 ) — — — Credit derivatives 7 — — — — Equity derivatives (904 ) — — — — Embedded derivatives 664 — — (4 ) — Total non-qualifying hedges (1,394 ) (4 ) — (4 ) — Total $ (1,345 ) $ 8 $ 24 $ (4 ) $ 28 |
Schedule of estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps | The following table presents the estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps at: September 30, 2019 December 31, 2018 Rating Agency Designation of Referenced Credit Obligations (1) Estimated Fair Value of Credit Default Swaps Maximum Amount of Future Payments under Credit Default Swaps Weighted Average Years to Maturity (2) Estimated Fair Value of Credit Default Swaps Maximum Amount of Future Payments under Credit Default Swaps Weighted Average Years to Maturity (2) (Dollars in millions) Aaa/Aa/A $ 9 $ 615 2.4 $ 8 $ 689 2.0 Baa 22 1,119 5.3 3 1,131 5.0 Total $ 31 $ 1,734 4.3 $ 11 $ 1,820 3.9 __________________ (1) The Company has written credit protection on both single name and index references. The rating agency designations are based on availability and the midpoint of the applicable ratings among Moody’s Investors Service, Standard & Poor’s Global Ratings and Fitch Ratings. If no rating is available from a rating agency, then an internally developed rating is used. (2) The weighted average years to maturity of the credit default swaps is calculated based on weighted average gross notional amounts. |
Estimated Fair Value of Derivative Assets and Liabilities after Master Netting Agreements and Cash Collateral | The estimated fair values of the Company’s net derivative assets and net derivative liabilities after the application of master netting agreements and collateral were as follows at: Gross Amounts Not Offset on the Consolidated Balance Sheets Gross Amount Recognized Financial Instruments (1) Collateral Received/Pledged (2) Net Amount Off-balance Sheet Securities Collateral (3) Net Amount After Securities Collateral (In millions) September 30, 2019 Derivative assets $ 4,575 $ (1,599 ) $ (1,851 ) $ 1,125 $ (1,089 ) $ 36 Derivative liabilities $ 2,232 $ (1,599 ) $ — $ 633 $ (633 ) $ — December 31, 2018 Derivative assets $ 2,833 $ (1,671 ) $ (1,062 ) $ 100 $ (86 ) $ 14 Derivative liabilities $ 2,104 $ (1,671 ) $ — $ 433 $ (433 ) $ — __________________ (1) Represents amounts subject to an enforceable master netting agreement or similar agreement. (2) The amount of cash collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreement. (3) Securities collateral received by the Company is not recorded on the balance sheet. Amounts do not include excess of collateral pledged or received. |
Estimated Fair Value of Derivative Assets and Liabilities after Master Netting Agreements and Cash Collateral | The estimated fair values of the Company’s net derivative assets and net derivative liabilities after the application of master netting agreements and collateral were as follows at: Gross Amounts Not Offset on the Consolidated Balance Sheets Gross Amount Recognized Financial Instruments (1) Collateral Received/Pledged (2) Net Amount Off-balance Sheet Securities Collateral (3) Net Amount After Securities Collateral (In millions) September 30, 2019 Derivative assets $ 4,575 $ (1,599 ) $ (1,851 ) $ 1,125 $ (1,089 ) $ 36 Derivative liabilities $ 2,232 $ (1,599 ) $ — $ 633 $ (633 ) $ — December 31, 2018 Derivative assets $ 2,833 $ (1,671 ) $ (1,062 ) $ 100 $ (86 ) $ 14 Derivative liabilities $ 2,104 $ (1,671 ) $ — $ 433 $ (433 ) $ — __________________ (1) Represents amounts subject to an enforceable master netting agreement or similar agreement. (2) The amount of cash collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreement. (3) Securities collateral received by the Company is not recorded on the balance sheet. Amounts do not include excess of collateral pledged or received. |
Schedule of Derivative Instruments | Derivatives are financial instruments with values derived from interest rates, foreign currency exchange rates, credit spreads and/or other financial indices. Derivatives may be exchange-traded or contracted in the over-the-counter (“OTC”) market. Certain of the Company’s OTC derivatives are cleared and settled through central clearing counterparties (“OTC-cleared”), while others are bilateral contracts between two counterparties (“OTC-bilateral”). The following table presents the aggregate estimated fair value of derivatives in a net liability position containing such credit contingent provisions and the aggregate estimated fair value of assets posted as collateral for such instruments. September 30, 2019 December 31, 2018 (In millions) Estimated fair value of derivatives in a net liability position (1) $ 633 $ 433 Estimated Fair Value of Collateral Provided (2): Fixed maturity securities $ 1,250 $ 797 __________________ (1) After taking into consideration the existence of netting agreements. (2) Substantially all of the Company’s collateral arrangements provide for daily posting of collateral for the full value of the derivative contract. As a result, if the credit contingent provisions of derivative contracts in a net liability position were triggered, minimal additional assets would be required to be posted as collateral or needed to settle the instruments immediately. |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Recurring Fair Value Measurements | September 30, 2019 Fair Value Hierarchy Level 1 Level 2 Level 3 Total Estimated (In millions) Assets Fixed maturity securities: U.S. corporate $ — $ 30,466 $ 436 $ 30,902 U.S. government and agency 1,667 6,079 — 7,746 RMBS — 9,138 77 9,215 Foreign corporate — 9,260 390 9,650 CMBS — 5,545 34 5,579 State and political subdivision — 3,916 73 3,989 ABS — 1,853 64 1,917 Foreign government — 1,725 — 1,725 Total fixed maturity securities 1,667 67,982 1,074 70,723 Equity securities 11 133 4 148 Short-term investments 1,299 686 — 1,985 Derivative assets: (1) Interest rate — 3,114 — 3,114 Foreign currency exchange rate — 455 13 468 Credit — 22 9 31 Equity market — 803 99 902 Total derivative assets — 4,394 121 4,515 Embedded derivatives within asset host contracts (2) — — 303 303 Separate account assets 224 103,704 — 103,928 Total assets $ 3,201 $ 176,899 $ 1,502 $ 181,602 Liabilities Derivative liabilities: (1) Interest rate $ — $ 422 $ — $ 422 Foreign currency exchange rate — 28 1 29 Equity market — 1,534 251 1,785 Total derivative liabilities — 1,984 252 2,236 Embedded derivatives within liability host contracts (2) — — 4,273 4,273 Total liabilities $ — $ 1,984 $ 4,525 $ 6,509 December 31, 2018 Fair Value Hierarchy Level 1 Level 2 Level 3 Total Estimated (In millions) Assets Fixed maturity securities: U.S. corporate $ — $ 24,150 $ 323 $ 24,473 U.S. government and agency 2,722 6,373 — 9,095 RMBS — 8,541 6 8,547 Foreign corporate — 7,617 409 8,026 CMBS — 5,120 128 5,248 State and political subdivision — 3,523 74 3,597 ABS — 2,087 39 2,126 Foreign government — 1,496 — 1,496 Total fixed maturity securities 2,722 58,907 979 62,608 Equity securities 13 124 3 140 Derivative assets: (1) Interest rate — 717 — 717 Foreign currency exchange rate — 301 11 312 Credit — 10 7 17 Equity market — 1,634 98 1,732 Total derivative assets — 2,662 116 2,778 Embedded derivatives within asset host contracts (2) — — 228 228 Separate account assets 217 98,038 1 98,256 Total assets $ 2,952 $ 159,731 $ 1,327 $ 164,010 Liabilities Derivative liabilities: (1) Interest rate $ — $ 619 $ — $ 619 Foreign currency exchange rate — 48 — 48 Credit — 2 1 3 Equity market — 1,205 237 1,442 Total derivative liabilities — 1,874 238 2,112 Embedded derivatives within liability host contracts (2) — — 2,226 2,226 Total liabilities $ — $ 1,874 $ 2,464 $ 4,338 __________________ (1) Derivative assets are presented within other invested assets on the consolidated balance sheets and derivative liabilities are presented within other liabilities on the consolidated balance sheets. The amounts are presented gross in the tables above to reflect the presentation on the consolidated balance sheets, but are presented net for purposes of the rollforward in the Fair Value Measurements Using Significant Unobservable Inputs (Level 3) tables. (2) |
Fair Value Inputs, Quantitative Information | The following table presents certain quantitative information about the significant unobservable inputs used in the fair value measurement, and the sensitivity of the estimated fair value to changes in those inputs, for the more significant asset and liability classes measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at: September 30, 2019 December 31, 2018 Impact of Increase in Input on Estimated Valuation Techniques Significant Unobservable Inputs Range Range Embedded derivatives Direct, assumed and ceded guaranteed minimum benefits • Option pricing techniques • Mortality rates 0.02% - 11.31% 0.02% - 11.31% Decrease (1) • Lapse rates 0.25% - 16.00% 0.25% - 16.00% Decrease (2) • Utilization rates 0.00% - 25.00% 0.00% - 25.00% Increase (3) • Withdrawal rates 0.25% - 10.00% 0.25% - 10.00% (4) • Long-term equity volatilities 16.50% - 22.00% 16.50% - 22.00% Increase (5) • Nonperformance risk spread 0.61% - 2.37% 1.91% - 2.66% Decrease (6) ___________________ (1) Mortality rates vary by age and by demographic characteristics such as gender. Range shown reflects the mortality rate for policyholders between 35 and 90 years old, which represents the majority of the business with living benefits. Mortality rate assumptions are set based on company experience and include an assumption for mortality improvement. (2) Range reflects base lapse rates for major product categories for duration 1-20, which represents majority of business with living benefit riders. Base lapse rates are adjusted at the contract level based on a comparison of the actuarially calculated guaranteed values and the current policyholder account value, as well as other factors, such as the applicability of any surrender charges. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in-the-money contracts are less likely to lapse. Lapse rates are also generally assumed to be lower in periods when a surrender charge applies. (3) The utilization rate assumption estimates the percentage of contract holders with a GMIB or lifetime withdrawal benefit who will elect to utilize the benefit upon becoming eligible in a given year. The range shown represents the floor and cap of the GMIB dynamic election rates across varying levels of in-the-money. For lifetime withdrawal guarantee riders, the assumption is that everyone will begin withdrawals once account value reaches zero which is equivalent to a 100% utilization rate. Utilization rates may vary by the type of guarantee, the amount by which the guaranteed amount is greater than the account value, the contract’s withdrawal history and by the age of the policyholder. (4) The withdrawal rate represents the percentage of account balance that any given policyholder will elect to withdraw from the contract each year. The withdrawal rate assumption varies by age and duration of the contract, and also by other factors such as benefit type. For any given contract, withdrawal rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. For GMWBs, any increase (decrease) in withdrawal rates results in an increase (decrease) in the estimated fair value of the guarantees. For GMABs and GMIBs, any increase (decrease) in withdrawal rates results in a decrease (increase) in the estimated fair value. (5) Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available. For any given contract, long-term equity volatility rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. (6) Nonperformance risk spread varies by duration. For any given contract, multiple nonperformance risk spreads will apply, depending on the duration of the cash flow being discounted for purposes of valuing the embedded derivative. |
Fair Value, Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables summarize the change of all assets and (liabilities) measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Fixed Maturity Securities Corporate (1) Structured Securities State and Foreign Equity Short-term Net Net Embedded Separate (In millions) Three Months Ended Balance, beginning of period $ 765 $ 108 $ 74 $ — $ 4 $ 6 $ (134 ) $ (3,121 ) $ — Total realized/unrealized gains (losses) included in net income (loss) (5) (6) — — — — — — (2 ) (630 ) — Total realized/unrealized gains (losses) included in AOCI — 1 — — — — 3 — — Purchases (7) 118 61 — — — — — — — Sales (7) (22 ) (6 ) (1 ) — — (6 ) — — — Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (219 ) — Transfers into Level 3 (8) 49 29 — — — — — — — Transfers out of Level 3 (8) (84 ) (18 ) — — — — 2 — — Balance, end of period $ 826 $ 175 $ 73 $ — $ 4 $ — $ (131 ) $ (3,970 ) $ — Three Months Ended Balance, beginning of period $ 1,872 $ 1,268 $ 8 $ — $ 120 $ — $ (284 ) $ (1,241 ) $ 4 Total realized/unrealized gains (losses) included in net income (loss) (5) (6) — 10 2 — (2 ) — (4 ) (40 ) — Total realized/unrealized gains (losses) included in AOCI (44 ) (8 ) (2 ) — — — — — — Purchases (7) 56 287 — — — — — — 1 Sales (7) (51 ) (114 ) (6 ) — — — — — — Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (154 ) — Transfers into Level 3 (8) 20 3 — — 9 — — — — Transfers out of Level 3 (8) (208 ) (172 ) (2 ) — (5 ) — — — (1 ) Balance, end of period $ 1,645 $ 1,274 $ — $ — $ 122 $ — $ (288 ) $ (1,435 ) $ 4 Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2019 (9) $ — $ — $ — $ — $ — $ — $ (2 ) $ (705 ) $ — Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2018 (9) $ — $ 4 $ — $ — $ — $ — $ (4 ) $ (37 ) $ — Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Fixed Maturity Securities Corporate (1) Structured Securities State and Foreign Equity Short-term Net Net Embedded Separate (In millions) Nine Months Ended Balance, beginning of period $ 732 $ 173 $ 74 $ — $ 3 $ — $ (122 ) $ (1,998 ) $ 1 Total realized/unrealized gains (losses) included in net income (loss) (5) (6) — 1 — — — — (10 ) (1,316 ) — Total realized/unrealized gains (losses) included in AOCI 11 3 — — — — 5 — — Purchases (7) 179 75 — — — — — — — Sales (7) (78 ) (24 ) (1 ) — — — — — (1 ) Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (656 ) — Transfers into Level 3 (8) 147 92 — — 1 — — — — Transfers out of Level 3 (8) (165 ) (145 ) — — — — (4 ) — — Balance, end of period $ 826 $ 175 $ 73 $ — $ 4 $ — $ (131 ) $ (3,970 ) $ — Nine Months Ended Balance, beginning of period $ 1,997 $ 1,230 $ — $ 5 $ 124 $ 14 $ (279 ) $ (1,660 ) $ 5 Total realized/unrealized gains (losses) included in net income (loss) (5) (6) 2 21 — — (4 ) — (12 ) 660 — Total realized/unrealized gains (losses) included in AOCI (121 ) (10 ) — — — — — — — Purchases (7) 164 339 — — — — 3 — 1 Sales (7) (184 ) (229 ) — — (3 ) (14 ) — — (1 ) Issuances (7) — — — — — — — — — Settlements (7) — — — — — — — (435 ) (1 ) Transfers into Level 3 (8) 20 — — — 10 — — — — Transfers out of Level 3 (8) (233 ) (77 ) — (5 ) (5 ) — — — — Balance, end of period $ 1,645 $ 1,274 $ — $ — $ 122 $ — $ (288 ) $ (1,435 ) $ 4 Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2019 (9) $ — $ 1 $ — $ — $ — $ — $ (11 ) $ (1,531 ) $ — Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at September 30, 2018 (9) $ (1 ) $ 14 $ — $ — $ (4 ) $ — $ (12 ) $ 867 $ — _______________ (1) Comprised of U.S. and foreign corporate securities. (2) Freestanding derivative assets and liabilities are presented net for purposes of the rollforward. (3) Embedded derivative assets and liabilities are presented net for purposes of the rollforward. (4) Investment performance related to separate account assets is fully offset by corresponding amounts credited to contract holders within separate account liabilities. Therefore, such changes in estimated fair value are not recorded in net income (loss). For the purpose of this disclosure, these changes are presented within net investment gains (losses). (5) Amortization of premium/accretion of discount is included within net investment income. Impairments charged to net income (loss) on securities are included in net investment gains (losses). Lapses associated with net embedded derivatives are included in net derivative gains (losses). Substantially all realized/unrealized gains (losses) included in net income (loss) for net derivatives and net embedded derivatives are reported in net derivative gains (losses). (6) Interest and dividend accruals, as well as cash interest coupons and dividends received, are excluded from the rollforward. (7) Items purchased/issued and then sold/settled in the same period are excluded from the rollforward. Fees attributed to embedded derivatives are included in settlements. (8) Gains and losses, in net income (loss) and OCI, are calculated assuming transfers into and/or out of Level 3 occurred at the beginning of the period. Items transferred into and then out of Level 3 in the same period are excluded from the rollforward. (9) Changes in unrealized gains (losses) included in net income (loss) relate to assets and liabilities still held at the end of the respective periods. Substantially all changes in unrealized gains (losses) included in net income (loss) for net derivatives and net embedded derivatives are reported in net derivative gains (losses). |
Fair Value of Financial Instruments Carried at Other Than Fair Value | The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows at: September 30, 2019 Fair Value Hierarchy Carrying Level 1 Level 2 Level 3 Total Estimated Fair Value (In millions) Assets Mortgage loans $ 15,359 $ — $ — $ 16,073 $ 16,073 Policy loans $ 1,332 $ — $ 555 $ 1,094 $ 1,649 Other invested assets $ 63 $ — $ 50 $ 13 $ 63 Premiums, reinsurance and other receivables $ 1,786 $ — $ 47 $ 2,151 $ 2,198 Liabilities Policyholder account balances $ 15,611 $ — $ — $ 15,818 $ 15,818 Long-term debt $ 4,365 $ — $ 3,283 $ 1,000 $ 4,283 Other liabilities $ 862 $ — $ 640 $ 222 $ 862 Separate account liabilities $ 1,126 $ — $ 1,126 $ — $ 1,126 December 31, 2018 Fair Value Hierarchy Carrying Level 1 Level 2 Level 3 Total Estimated Fair Value (In millions) Assets Mortgage loans $ 13,694 $ — $ — $ 13,860 $ 13,860 Policy loans $ 1,421 $ — $ 656 $ 959 $ 1,615 Other invested assets $ 77 $ — $ 64 $ 13 $ 77 Premiums, reinsurance and other receivables $ 1,609 $ — $ 32 $ 1,664 $ 1,696 Liabilities Policyholder account balances $ 15,332 $ — $ — $ 13,861 $ 13,861 Long-term debt $ 3,963 $ — $ 2,758 $ 600 $ 3,358 Other liabilities $ 330 $ — $ 118 $ 212 $ 330 Separate account liabilities $ 1,029 $ — $ 1,029 $ — $ 1,029 |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | Information regarding changes in the balances of each component of AOCI was as follows: Three Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, June 30, 2019 $ 2,564 $ 181 $ (20 ) $ (23 ) $ 2,702 OCI before reclassifications 970 160 (3 ) — 1,127 Deferred income tax benefit (expense) (204 ) (33 ) — — (237 ) AOCI before reclassifications, net of income tax 3,330 308 (23 ) (23 ) 3,592 Amounts reclassified from AOCI (30 ) (1 ) — — (31 ) Deferred income tax benefit (expense) 6 — — — 6 Amounts reclassified from AOCI, net of income tax (24 ) (1 ) — — (25 ) Balance, September 30, 2019 $ 3,306 $ 307 $ (23 ) $ (23 ) $ 3,567 Three Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, June 30, 2018 $ 690 $ 168 $ (19 ) $ (24 ) $ 815 OCI before reclassifications (310 ) (7 ) (7 ) — (324 ) Deferred income tax benefit (expense) 66 1 1 — 68 AOCI before reclassifications, net of income tax 446 162 (25 ) (24 ) 559 Amounts reclassified from AOCI 38 (47 ) — — (9 ) Deferred income tax benefit (expense) (8 ) 10 — — 2 Amounts reclassified from AOCI, net of income tax 30 (37 ) — — (7 ) Balance, September 30, 2018 $ 476 $ 125 $ (25 ) $ (24 ) $ 552 Nine Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, December 31, 2018 $ 576 $ 187 $ (27 ) $ (20 ) $ 716 OCI before reclassifications 3,515 201 4 (3 ) 3,717 Deferred income tax benefit (expense) (738 ) (42 ) — — (780 ) AOCI before reclassifications, net of income tax 3,353 346 (23 ) (23 ) 3,653 Amounts reclassified from AOCI (59 ) (49 ) — — (108 ) Deferred income tax benefit (expense) 12 10 — — 22 Amounts reclassified from AOCI, net of income tax (47 ) (39 ) — — (86 ) Balance, September 30, 2019 $ 3,306 $ 307 $ (23 ) $ (23 ) $ 3,567 Nine Months Ended Unrealized Unrealized Foreign Defined Benefit Plans Adjustment Total (In millions) Balance, December 31, 2017 $ 1,572 $ 154 $ (24 ) $ (26 ) $ 1,676 Cumulative effect of change in accounting principle, net of income tax (79 ) — — — (79 ) Balance, January 1, 2018 1,493 154 (24 ) (26 ) 1,597 OCI before reclassifications (1,448 ) 28 (1 ) 3 (1,418 ) Deferred income tax benefit (expense) 325 (6 ) — (1 ) 318 AOCI before reclassifications, net of income tax 370 176 (25 ) (24 ) 497 Amounts reclassified from AOCI 138 (65 ) — — 73 Deferred income tax benefit (expense) (32 ) 14 — — (18 ) Amounts reclassified from AOCI, net of income tax 106 (51 ) — — 55 Balance, September 30, 2018 $ 476 $ 125 $ (25 ) $ (24 ) $ 552 __________________ (1) See Note 4 for information on offsets to investments related to future policy benefits, DAC, VOBA and DSI. |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Information regarding amounts reclassified out of each component of AOCI was as follows: AOCI Components Amounts Reclassified from AOCI Consolidated Statements of Operations and Comprehensive Income (Loss) Locations Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Net unrealized investment gains (losses): Net unrealized investment gains (losses) $ 31 $ (36 ) $ 86 $ (137 ) Net investment gains (losses) Net unrealized investment gains (losses) — — — 1 Net investment income Net unrealized investment gains (losses) (1 ) (2 ) (27 ) (2 ) Net derivative gains (losses) Net unrealized investment gains (losses), before income tax 30 (38 ) 59 (138 ) Income tax (expense) benefit (6 ) 8 (12 ) 32 Net unrealized investment gains (losses), net of income tax 24 (30 ) 47 (106 ) Unrealized gains (losses) on derivatives - cash flow hedges: Interest rate swaps — 15 28 31 Net derivative gains (losses) Interest rate swaps 1 — 2 2 Net investment income Interest rate forwards — 31 — 31 Net derivative gains (losses) Interest rate forwards — 1 — 2 Net investment income Foreign currency swaps — — 19 (1 ) Net derivative gains (losses) Gains (losses) on cash flow hedges, before income tax 1 47 49 65 Income tax (expense) benefit — (10 ) (10 ) (14 ) Gains (losses) on cash flow hedges, net of income tax 1 37 39 51 Total reclassifications, net of income tax $ 25 $ 7 $ 86 $ (55 ) |
Other Revenues and Other Expe_2
Other Revenues and Other Expenses Other Revenues and Expenses (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Operating Cost and Expense, by Component [Table Text Block] | Information on other expenses was as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Compensation $ 76 $ 67 $ 238 $ 220 Contracted services and other labor costs 73 63 185 189 Transition services agreements 64 70 196 215 Establishment costs 13 87 85 190 Premium and other taxes, licenses and fees 15 12 35 55 Separate account fees 123 133 365 401 Volume related costs, excluding compensation, net of DAC capitalization 155 161 472 486 Interest expense on debt 49 39 144 113 Other 43 33 104 105 Total other expenses $ 611 $ 665 $ 1,824 $ 1,974 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | The following table sets forth the calculation of earnings per common share: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions, except share and per share data) Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 676 $ (271 ) $ 316 $ (577 ) Weighted average common shares outstanding — basic 110,915,416 119,657,443 114,195,767 119,734,128 Dilutive effect of share-based awards 612,064 — 546,931 — Weighted average common shares outstanding — diluted 111,527,480 119,657,443 114,742,698 119,734,128 Earnings per common share: Basic $ 6.09 $ (2.26 ) $ 2.77 $ (4.82 ) Diluted $ 6.06 $ (2.26 ) $ 2.75 $ (4.82 ) |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions [Table Text Block] | The following table summarizes income and expense from affiliated transactions with MetLife prior to the MetLife Divestiture (see Note 1 ) for the periods indicated: Three Months Ended Nine Months Ended 2019 2018 2019 2018 (In millions) Income (1) $ — $ — $ — $ (182 ) Expense (2) $ — $ — $ — $ 133 __________________ (1) Primarily includes the net impact of reinsurance ceded to MetLife. (2) Primarily includes costs incurred with MetLife related to shared services, offset by reinsurance ceded to MetLife. |
Business, Basis of Presentati_3
Business, Basis of Presentation and Summary of Significant Accounting Policies (Narrative) (Details) - Segment | 9 Months Ended | |
Sep. 30, 2019 | Aug. 04, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Number of Reportable Segments | 3 | |
Spinoff | ||
Restructuring Cost and Reserve [Line Items] | ||
Common Stock Distribution by Parent | 80.80% | |
Common Stock Retained by Parent | 19.20% |
Segment Information (Operating
Segment Information (Operating Results) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||||
Pre-tax adjusted earnings | $ 804 | $ (368) | $ 320 | $ (798) | ||
Provision for income tax expense (benefit) | 119 | (99) | (14) | (226) | ||
Post-tax adjusted earnings | 685 | (269) | $ (351) | $ (303) | 334 | (572) |
Net investment gains (losses) | 27 | (42) | 79 | (121) | ||
Net derivative gains (losses) | 1,057 | (691) | (97) | (1,337) | ||
Other adjustments to net income | 94 | 105 | 282 | 308 | ||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | 676 | (271) | 316 | (577) | ||
Annuities | ||||||
Segment Reporting Information [Line Items] | ||||||
Interest revenue | 461 | 399 | 1,352 | 1,138 | ||
Interest expense | 0 | 0 | 0 | 0 | ||
Life | ||||||
Segment Reporting Information [Line Items] | ||||||
Interest revenue | 117 | 115 | 330 | 334 | ||
Interest expense | 0 | 0 | 0 | 0 | ||
Run-off | ||||||
Segment Reporting Information [Line Items] | ||||||
Interest revenue | 327 | 322 | 942 | 979 | ||
Interest expense | 0 | 0 | 0 | 0 | ||
Corporate & Other | ||||||
Segment Reporting Information [Line Items] | ||||||
Interest revenue | 23 | 16 | 57 | 38 | ||
Interest expense | 49 | 39 | 144 | 113 | ||
Operating Segments | ||||||
Segment Reporting Information [Line Items] | ||||||
Pre-tax adjusted earnings | (264) | 314 | 322 | 824 | ||
Provision for income tax expense (benefit) | (104) | 42 | (13) | 113 | ||
Post-tax adjusted earnings | (160) | 272 | 335 | 711 | ||
Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends | 9 | 2 | 18 | 5 | ||
Adjusted earnings | (169) | 270 | 317 | 706 | ||
Operating Segments | Annuities | ||||||
Segment Reporting Information [Line Items] | ||||||
Pre-tax adjusted earnings | 255 | 487 | 939 | 1,025 | ||
Provision for income tax expense (benefit) | 52 | 86 | 176 | 177 | ||
Post-tax adjusted earnings | 203 | 401 | 763 | 848 | ||
Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends | 0 | 0 | 0 | 0 | ||
Adjusted earnings | 203 | 401 | 763 | 848 | ||
Operating Segments | Life | ||||||
Segment Reporting Information [Line Items] | ||||||
Pre-tax adjusted earnings | 91 | 78 | 194 | 205 | ||
Provision for income tax expense (benefit) | 18 | 17 | 38 | 41 | ||
Post-tax adjusted earnings | 73 | 61 | 156 | 164 | ||
Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends | 0 | 0 | 0 | 0 | ||
Adjusted earnings | 73 | 61 | 156 | 164 | ||
Operating Segments | Run-off | ||||||
Segment Reporting Information [Line Items] | ||||||
Pre-tax adjusted earnings | (543) | (134) | (587) | (79) | ||
Provision for income tax expense (benefit) | (117) | (29) | (127) | (18) | ||
Post-tax adjusted earnings | (426) | (105) | (460) | (61) | ||
Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends | 0 | 0 | 0 | 0 | ||
Adjusted earnings | (426) | (105) | (460) | (61) | ||
Operating Segments | Corporate & Other | ||||||
Segment Reporting Information [Line Items] | ||||||
Pre-tax adjusted earnings | (67) | (117) | (224) | (327) | ||
Provision for income tax expense (benefit) | (57) | (32) | (100) | (87) | ||
Post-tax adjusted earnings | (10) | (85) | (124) | (240) | ||
Less: Net income (loss) attributable to noncontrolling interests and preferred stock dividends | 9 | 2 | 18 | 5 | ||
Adjusted earnings | (19) | (87) | (142) | (245) | ||
Segment Reconciling Items | ||||||
Segment Reporting Information [Line Items] | ||||||
Provision for income tax expense (benefit) | (223) | 141 | 1 | 339 | ||
Net investment gains (losses) | 27 | (42) | 79 | (121) | ||
Net derivative gains (losses) | 1,057 | (691) | (97) | (1,337) | ||
Other adjustments to net income | $ (16) | $ 51 | $ 16 | $ (164) |
Segment Information (Reconcilia
Segment Information (Reconciliation of Operating Revenues to Total Revenues) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | $ 3,187 | $ 1,422 | $ 6,248 | $ 4,939 |
Annuities | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | 1,184 | 1,160 | 3,495 | 3,453 |
Life | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | 320 | 346 | 953 | 1,054 |
Run-off | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | 484 | 536 | 1,487 | 1,594 |
Corporate & Other | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | 47 | 47 | 132 | 112 |
Segment Reconciling Items | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | $ 1,152 | $ (667) | $ 181 | $ (1,274) |
Segment Information (Total Asse
Segment Information (Total Assets) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 225,876 | $ 206,294 |
Annuities | ||
Segment Reporting Information [Line Items] | ||
Total assets | 154,811 | 141,489 |
Life | ||
Segment Reporting Information [Line Items] | ||
Total assets | 20,954 | 20,449 |
Run-off | ||
Segment Reporting Information [Line Items] | ||
Total assets | 36,080 | 32,393 |
Corporate & Other | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ 14,031 | $ 11,963 |
Segment Information (Narrative)
Segment Information (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2019Segment | |
Segment Reporting [Abstract] | |
Number of segments | 3 |
Insurance (Guarantees Related t
Insurance (Guarantees Related to Annuity Contracts) (Details) - Variable Annuity Guarantees - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Guaranteed Death Benefits | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Total account value (3) | $ 101,594 | $ 96,865 |
Separate account value | 96,645 | 91,837 |
Net amount at risk | $ 7,393 | $ 11,073 |
Average attained age of contract holders | 68 years | 68 years |
Guaranteed Annuitization Benefits | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Total account value (3) | $ 58,572 | $ 55,967 |
Separate account value | 57,390 | 54,731 |
Net amount at risk | $ 5,003 | $ 4,128 |
Average attained age of contract holders | 68 years | 68 years |
Insurance (Guarantees Related_2
Insurance (Guarantees Related to Universal and Variable Life Contracts) (Details) - Secondary Guarantees - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Universal Life Contracts | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Total account value (3) | $ 6,000 | $ 6,099 |
Net amount at risk | $ 71,641 | $ 73,131 |
Average attained age of policyholders | 66 years | 65 years |
Variable Life Contracts | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Total account value (3) | $ 3,387 | $ 3,230 |
Net amount at risk | $ 21,763 | $ 23,004 |
Average attained age of policyholders | 50 years | 50 years |
Investments (Fixed Maturity Sec
Investments (Fixed Maturity Securities AFS by Sector) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 63,115 | $ 60,920 |
Gross Unrealized Gains | 7,830 | 3,068 |
Gross Unrealized Temporary Losses | 227 | 1,383 |
Gross Unrealized OTTI Losses | (5) | (3) |
Fixed maturity securities | 70,723 | 62,608 |
U.S. corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 27,968 | 24,312 |
Gross Unrealized Gains | 3,011 | 830 |
Gross Unrealized Temporary Losses | 77 | 669 |
Gross Unrealized OTTI Losses | 0 | 0 |
Fixed maturity securities | 30,902 | 24,473 |
U.S. government and agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 5,518 | 7,944 |
Gross Unrealized Gains | 2,229 | 1,263 |
Gross Unrealized Temporary Losses | 1 | 112 |
Gross Unrealized OTTI Losses | 0 | 0 |
Fixed maturity securities | 7,746 | 9,095 |
RMBS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 8,712 | 8,428 |
Gross Unrealized Gains | 511 | 246 |
Gross Unrealized Temporary Losses | 13 | 129 |
Gross Unrealized OTTI Losses | (5) | (2) |
Fixed maturity securities | 9,215 | 8,547 |
Foreign corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 9,089 | 8,183 |
Gross Unrealized Gains | 679 | 159 |
Gross Unrealized Temporary Losses | 118 | 316 |
Gross Unrealized OTTI Losses | 0 | 0 |
Fixed maturity securities | 9,650 | 8,026 |
CMBS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 5,241 | 5,292 |
Gross Unrealized Gains | 341 | 43 |
Gross Unrealized Temporary Losses | 3 | 88 |
Gross Unrealized OTTI Losses | 0 | (1) |
Fixed maturity securities | 5,579 | 5,248 |
State and political subdivision | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 3,209 | 3,200 |
Gross Unrealized Gains | 780 | 412 |
Gross Unrealized Temporary Losses | 0 | 15 |
Gross Unrealized OTTI Losses | 0 | 0 |
Fixed maturity securities | 3,989 | 3,597 |
ABS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,899 | 2,135 |
Gross Unrealized Gains | 28 | 13 |
Gross Unrealized Temporary Losses | 10 | 22 |
Gross Unrealized OTTI Losses | 0 | 0 |
Fixed maturity securities | 1,917 | 2,126 |
Foreign government | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,479 | 1,426 |
Gross Unrealized Gains | 251 | 102 |
Gross Unrealized Temporary Losses | 5 | 32 |
Gross Unrealized OTTI Losses | 0 | 0 |
Fixed maturity securities | $ 1,725 | $ 1,496 |
Investments (Maturities of Fixe
Investments (Maturities of Fixed Maturity Securities) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Amortized Cost, Due in one year or less | $ 1,957 | |
Amortized Cost, Due after one year through five years | 6,764 | |
Amortized Cost, Due after five years through ten years | 12,584 | |
Amortized Cost, Due after ten years | 25,958 | |
Amortized Cost, Structured Securities | 15,852 | |
Amortized Cost | 63,115 | $ 60,920 |
Estimated Fair Value, Due in one year or less | 1,963 | |
Estimated Fair Value, Due after one year through five years | 6,959 | |
Estimated Fair Value, Due after five years through ten years | 13,422 | |
Estimated Fair Value, Due after ten years | 31,668 | |
Estimated Fair Value, Structured Securities | 16,711 | |
Fixed maturity securities | $ 70,723 | $ 62,608 |
Investments (Continuous Gross U
Investments (Continuous Gross Unrealized Losses for Fixed Maturity Securities AFS by Sector) (Details) $ in Millions | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) |
U.S. corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | $ 1,621 | $ 10,584 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 43 | 470 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 414 | 2,328 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 34 | 199 |
U.S. government and agency | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 106 | 412 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 1 | 8 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 0 | 1,543 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 0 | 104 |
RMBS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 536 | 1,627 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 3 | 26 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 453 | 2,611 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 5 | 101 |
Foreign corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 832 | 3,982 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 28 | 203 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 642 | 774 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 90 | 113 |
CMBS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 102 | 2,317 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 1 | 53 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 190 | 803 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 2 | 34 |
State and political subdivision | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 15 | 346 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 0 | 7 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 8 | 158 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 0 | 8 |
ABS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 449 | 1,422 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 3 | 21 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 504 | 70 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 7 | 1 |
Foreign government | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 52 | 521 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | 5 | 26 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | 0 | 132 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | 0 | 6 |
Fixed maturity securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Estimated Fair Value of securities in an unrealized loss position for less than 12 months | 3,713 | 21,211 |
Gross Unrealized Losses of securities in an unrealized loss position for less than 12 months | $ 84 | $ 814 |
Total number of securities in an unrealized loss position for less than 12 months | 693 | 3,027 |
Estimated Fair Value of securities in an unrealized loss position for 12 months or greater | $ 2,211 | $ 8,419 |
Gross Unrealized Losses of securities in an unrealized loss position for 12 months or greater | $ 138 | $ 566 |
Total number of securities in an unrealized loss position for 12 months or greater | 320 | 1,028 |
Investments (Mortgage Loans by
Investments (Mortgage Loans by Portfolio Segment) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Carrying Value | $ 15,423 | $ 13,751 |
Mortgage loans, gross as a percentage of total mortgage loans, net | 100.40% | 100.40% |
Mortgage loans valuation allowances | $ (64) | $ (57) |
Mortgage loans valuation allowances as a percentage of total mortgage loans, net | (0.40%) | (0.40%) |
Total mortgage loans, net | $ 15,359 | $ 13,694 |
Total mortgage loans, net as a percentage of total mortgage loans, net | 100.00% | 100.00% |
Mortgage Loans | Commercial | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Carrying Value | $ 9,473 | $ 8,529 |
Mortgage loans, gross as a percentage of total mortgage loans, net | 61.70% | 62.30% |
Mortgage Loans | Agricultural | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Carrying Value | $ 3,291 | $ 2,946 |
Mortgage loans, gross as a percentage of total mortgage loans, net | 21.40% | 21.50% |
Mortgage Loans | Residential | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Carrying Value | $ 2,659 | $ 2,276 |
Mortgage loans, gross as a percentage of total mortgage loans, net | 17.30% | 16.60% |
Investments (Credit Quality of
Investments (Credit Quality of Mortgage Loans) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 15,423 | $ 13,751 |
Mortgage Loans | Performing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment as a % of Total | 99.00% | 99.00% |
Mortgage Loans | Commercial | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 9,473 | $ 8,529 |
Recorded Investment as a % of Total | 100.00% | 100.00% |
Estimated Fair Value of Recorded Investment | $ 9,986 | $ 8,611 |
Estimated Fair Value of Recorded Investment as a % of Total | 100.00% | 100.00% |
Mortgage Loans | Commercial | Debt Service Coverage Ratio, Greater than 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 9,177 | $ 8,373 |
Mortgage Loans | Commercial | Debt Service Coverage Ratio, 1.00x to 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 146 | 89 |
Mortgage Loans | Commercial | Debt Service Coverage Ratio, Less than 1.00x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 150 | 67 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, Less than 65% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 8,624 | $ 7,593 |
Recorded Investment as a % of Total | 91.00% | 89.00% |
Estimated Fair Value of Recorded Investment | $ 9,111 | $ 7,668 |
Estimated Fair Value of Recorded Investment as a % of Total | 91.20% | 89.00% |
Mortgage Loans | Commercial | Loan-to-Value Ratio, Less than 65% | Debt Service Coverage Ratio, Greater than 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 8,355 | $ 7,470 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, Less than 65% | Debt Service Coverage Ratio, 1.00x to 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 128 | 89 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, Less than 65% | Debt Service Coverage Ratio, Less than 1.00x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 141 | 34 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 65% to 75% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 702 | $ 786 |
Recorded Investment as a % of Total | 7.40% | 9.20% |
Estimated Fair Value of Recorded Investment | $ 729 | $ 798 |
Estimated Fair Value of Recorded Investment as a % of Total | 7.30% | 9.30% |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 65% to 75% | Debt Service Coverage Ratio, Greater than 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 684 | $ 762 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 65% to 75% | Debt Service Coverage Ratio, 1.00x to 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 18 | 0 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 65% to 75% | Debt Service Coverage Ratio, Less than 1.00x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 0 | 24 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 76% to 80% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 147 | $ 150 |
Recorded Investment as a % of Total | 1.60% | 1.80% |
Estimated Fair Value of Recorded Investment | $ 146 | $ 145 |
Estimated Fair Value of Recorded Investment as a % of Total | 1.50% | 1.70% |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 76% to 80% | Debt Service Coverage Ratio, Greater than 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 138 | $ 141 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 76% to 80% | Debt Service Coverage Ratio, 1.00x to 1.20x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 0 | 0 |
Mortgage Loans | Commercial | Loan-to-Value Ratio, 76% to 80% | Debt Service Coverage Ratio, Less than 1.00x | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | 9 | 9 |
Mortgage Loans | Agricultural | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 3,291 | $ 2,946 |
Recorded Investment as a % of Total | 100.00% | 100.00% |
Estimated Fair Value of Recorded Investment | $ 3,400 | $ 2,900 |
Mortgage Loans | Agricultural | Loan-to-Value Ratio, Less than 65% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 3,046 | $ 2,623 |
Recorded Investment as a % of Total | 92.60% | 89.00% |
Mortgage Loans | Agricultural | Loan-to-Value Ratio, 65% to 75% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 243 | $ 322 |
Recorded Investment as a % of Total | 7.30% | 10.90% |
Mortgage Loans | Agricultural | Loan-to-Value Ratio, 76% to 80% | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 2 | $ 1 |
Recorded Investment as a % of Total | 0.10% | 0.10% |
Mortgage Loans | Residential | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 2,659 | $ 2,276 |
Recorded Investment as a % of Total | 100.00% | 100.00% |
Estimated Fair Value of Recorded Investment | $ 2,700 | $ 2,300 |
Mortgage Loans | Residential | Performing | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 2,621 | $ 2,240 |
Recorded Investment as a % of Total | 98.60% | 98.40% |
Mortgage Loans | Residential | Nonperforming | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Recorded Investment | $ 38 | $ 36 |
Recorded Investment as a % of Total | 1.40% | 1.60% |
Investments (Net Unrealized Inv
Investments (Net Unrealized Investment Gains (Losses)) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Components of net unrealized investment gains (losses) included in accumulated other comprehensive loss | ||
Fixed maturity securities | $ 7,608 | $ 1,691 |
Derivatives | 416 | 264 |
Other | (14) | (13) |
Subtotal | 8,010 | 1,942 |
Future policy benefits | (3,050) | (886) |
DAC, VOBA and DSI | (386) | (90) |
Subtotal | (3,436) | (976) |
Deferred income tax benefit (expense) | (961) | (203) |
Net unrealized investment gains (losses) | $ 3,613 | $ 763 |
Investments (Changes in Net Unr
Investments (Changes in Net Unrealized Investment Gains (Losses)) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |
Balance, December 31, 2018 | $ 763 |
Unrealized investment gains (losses) during the period | 6,068 |
Unrealized investment gains (losses) relating to: | |
Future policy benefits | (2,164) |
DAC, VOBA and DSI | (296) |
Deferred income tax benefit (expense) | (758) |
Balance, September 30, 2019 | 3,613 |
Change in net unrealized investment gains (losses) | $ 2,850 |
Investments (Securities Lending
Investments (Securities Lending) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Securities Financing Transaction [Line Items] | ||
Cash collateral received from counterparties | $ 3,244 | $ 3,646 |
Security collateral received from counterparties | 35 | 55 |
Reinvestment portfolio — estimated fair value | 3,354 | 3,658 |
Amortized cost | ||
Securities Financing Transaction [Line Items] | ||
Securities on loan | 2,055 | 3,056 |
Estimated fair value | ||
Securities Financing Transaction [Line Items] | ||
Securities on loan | $ 3,214 | $ 3,628 |
Investments (Securities Lendi_2
Investments (Securities Lending Remaining Tenor) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Securities Financing Transaction [Line Items] | ||
Cash collateral received from counterparties | $ 3,244 | $ 3,646 |
U.S. government and agency | ||
Securities Financing Transaction [Line Items] | ||
Cash collateral received from counterparties | 3,244 | 3,646 |
U.S. government and agency | Remaining Tenor of Securities Lending Agreements: Open | ||
Securities Financing Transaction [Line Items] | ||
Cash collateral received from counterparties | 1,561 | 1,474 |
U.S. government and agency | Remaining Tenor of Securities Lending Agreements: 1 Month or Less | ||
Securities Financing Transaction [Line Items] | ||
Cash collateral received from counterparties | 1,283 | 1,823 |
U.S. government and agency | Remaining Tenor of Securities Lending Agreements: 1 to 6 Months | ||
Securities Financing Transaction [Line Items] | ||
Cash collateral received from counterparties | $ 400 | $ 349 |
Investments (Invested Assets on
Investments (Invested Assets on Deposit, Held In Trust and Pledged as Collateral) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Invested assets on deposit (regulatory deposits) | $ 9,443 | $ 8,176 |
Invested assets held in trust (reinsurance agreements) | 4,429 | 3,455 |
Invested assets pledged as collateral | 3,471 | 3,341 |
Total invested assets on deposit, held in trust and pledged as collateral | $ 17,343 | $ 14,972 |
Investments (Variable Interest
Investments (Variable Interest Entities) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Variable Interest Entity [Line Items] | ||
Carrying Amount | $ 15,207 | $ 14,855 |
Maximum Exposure to Loss | 15,659 | 16,244 |
Fixed maturity securities | ||
Variable Interest Entity [Line Items] | ||
Carrying Amount | 13,361 | 13,099 |
Maximum Exposure to Loss | 12,592 | 13,099 |
Limited partnerships and LLCs | ||
Variable Interest Entity [Line Items] | ||
Carrying Amount | 1,846 | 1,756 |
Maximum Exposure to Loss | $ 3,067 | $ 3,145 |
Investments (Net Investment Inc
Investments (Net Investment Income) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Net Investment Income [Line Items] | ||||
Gross investment income | $ 978 | $ 906 | $ 2,834 | $ 2,621 |
Less: Investment expenses | 50 | 53 | 153 | 145 |
Net investment income | 928 | 853 | 2,681 | 2,476 |
Fixed maturity securities | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 665 | 641 | 1,997 | 1,907 |
Equity securities | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 2 | 1 | 6 | 5 |
Mortgage loans | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 172 | 138 | 507 | 384 |
Policy loans | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 18 | 17 | 51 | 67 |
Real estate limited partnerships and limited liability companies | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 12 | 12 | 32 | 36 |
Other limited partnership interests | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 67 | 69 | 143 | 159 |
Cash, cash equivalents and short-term investments | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | 30 | 8 | 67 | 21 |
Other | ||||
Net Investment Income [Line Items] | ||||
Gross investment income | $ 12 | $ 20 | $ 31 | $ 42 |
Investments (Components of Net
Investments (Components of Net Investment Gains (Losses)) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Net investment gains (losses), fixed maturity securities | $ 28 | $ (34) | $ 81 | $ (138) |
Net investment gains (losses), equity securities | 3 | (1) | 14 | (5) |
Net investment gains (losses), mortgage loans | (1) | (5) | (8) | (12) |
Net investment gains (losses), real estate limited partnerships and limited liability companies | 0 | 0 | 0 | 42 |
Net investment gains (losses), other limited partnership interests | (3) | 0 | (8) | 0 |
Net investment gains (losses), other | 0 | (2) | 0 | (8) |
Total net investment gains (losses) | $ 27 | $ (42) | $ 79 | $ (121) |
Investments (Sales or Disposals
Investments (Sales or Disposals of Fixed Maturity Securities) (Details) - Fixed maturity securities - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Debt Securities, Available-for-sale [Line Items] | ||||
Proceeds | $ 1,628 | $ 3,091 | $ 8,586 | $ 8,428 |
Gross investment gains | 45 | 58 | 218 | 70 |
Gross investment losses | (17) | (92) | (137) | (208) |
Net investment gains (losses) | $ 28 | $ (34) | $ 81 | $ (138) |
Investments (Fixed Maturity S_2
Investments (Fixed Maturity Securities AFS - Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturity securities | $ 70,723 | $ 62,608 |
Non-Income Producing Debt Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturity securities | $ 0 | |
Non-Income Producing Debt Securities | Maximum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Fixed maturity securities | $ 1 |
Investments (Continuous Gross_2
Investments (Continuous Gross Unrealized Losses for Fixed Maturity Securities AFS by Sector - Narrative) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($)Contracts | |
Debt Securities, Available-for-sale [Line Items] | |
Fixed maturity securities available-for-sale with gross unrealized loss of equal to or greater than stated percentage | 20.00% |
Fixed maturity securities | |
Debt Securities, Available-for-sale [Line Items] | |
Change in gross unrealized losses of securities in an unrealized loss position | $ (1,200) |
Gross unrealized losses of securities in an unrealized loss position | 222 |
20% or more | Six months or greater | Fixed maturity securities | |
Debt Securities, Available-for-sale [Line Items] | |
Gross unrealized losses of securities in an unrealized loss position | $ 11 |
Number of Securities | Contracts | 11 |
Investments (Mortgage Loans - N
Investments (Mortgage Loans - Narrative) (Details) - Mortgage Loans - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Financing Receivable, Past Due [Line Items] | |||||
Significant Purchases | $ 159 | $ 816 | $ 722 | $ 1,400 | |
Performing | |||||
Financing Receivable, Past Due [Line Items] | |||||
Recorded Investment as a % of Total | 99.00% | 99.00% | 99.00% | ||
Commercial | |||||
Financing Receivable, Past Due [Line Items] | |||||
Estimated Fair Value of Recorded Investment | $ 9,986 | $ 9,986 | $ 8,611 | ||
Recorded Investment of Loans Past Due | 0 | 0 | 0 | ||
Recorded Investment of Loans in Nonaccrual Status | 0 | 0 | 0 | ||
Agricultural | |||||
Financing Receivable, Past Due [Line Items] | |||||
Estimated Fair Value of Recorded Investment | 3,400 | 3,400 | 2,900 | ||
Recorded Investment of Loans Past Due | 7 | 7 | |||
Recorded Investment of Loans in Nonaccrual Status | 0 | 0 | 0 | ||
Agricultural | Maximum | |||||
Financing Receivable, Past Due [Line Items] | |||||
Recorded Investment of Loans Past Due | 1 | ||||
Residential | |||||
Financing Receivable, Past Due [Line Items] | |||||
Estimated Fair Value of Recorded Investment | $ 2,700 | $ 2,700 | $ 2,300 | ||
Recorded Investment as a % of Total | 100.00% | 100.00% | 100.00% | ||
Recorded Investment of Loans Past Due | $ 38 | $ 38 | $ 36 | ||
Recorded Investment of Loans in Nonaccrual Status | $ 38 | $ 38 | $ 36 | ||
Residential | Performing | |||||
Financing Receivable, Past Due [Line Items] | |||||
Recorded Investment as a % of Total | 98.60% | 98.60% | 98.40% |
Investments (Other Invested Ass
Investments (Other Invested Assets - Narrative) (Details) | Sep. 30, 2019 |
Other invested assets | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |
Percentage Estimated Fair Value | 90.00% |
Investments (Securities Lendi_3
Investments (Securities Lending - Narrative) (Details) $ in Billions | Sep. 30, 2019USD ($) |
Securities Investment | |
Securities Financing Transaction [Line Items] | |
Percentage of Reinvestment Portfolio in Fixed Maturity Securities | 55.00% |
Estimated fair value | |
Securities Financing Transaction [Line Items] | |
Cash collateral on deposit from counterparties | $ 1.5 |
Estimated fair value | U.S. government and agency | |
Securities Financing Transaction [Line Items] | |
Percentage of Securities at Estimated Fair Value of Securities on Loan Relating to Cash Collateral on Open | 100.00% |
Investments (Invested Assets _2
Investments (Invested Assets On Deposit, Held in Trust and Pledged as Collateral - Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Invested assets on deposit (regulatory deposits) | $ 9,443 | $ 8,176 |
Invested assets held in trust (reinsurance agreements) | 4,429 | 3,455 |
Fixed maturity securities | Policyholder account balances | ||
Invested assets on deposit (regulatory deposits) | 75 | 55 |
Fixed maturity securities | Reinsurance | ||
Invested assets held in trust (reinsurance agreements) | $ 132 | $ 87 |
Investments (Variable Interes_2
Investments (Variable Interest Entities - Narrative) (Details) | Sep. 30, 2019 | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Material VIEs | 0 | 0 |
Derivatives (Primary Risks Mana
Derivatives (Primary Risks Managed by Derivatives) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | $ 106,323 | $ 92,773 |
Derivative Asset, Fair Value, Gross Asset | 4,818 | 3,006 |
Derivative Liability, Fair Value, Gross Liability | 6,509 | 4,338 |
Embedded Derivative, Fair Value of Embedded Derivative Asset | 303 | 228 |
Embedded Derivative, Fair Value of Embedded Derivative Liability | 4,273 | 2,226 |
Derivatives Designated as Hedging Instruments: | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 3,197 | 2,524 |
Derivative Asset, Fair Value, Gross Asset | 371 | 211 |
Derivative Liability, Fair Value, Gross Liability | 16 | 30 |
Derivatives Designated as Hedging Instruments: | Cash flow hedges: | Interest rate forwards | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 460 | 0 |
Derivative Asset, Fair Value, Gross Asset | 51 | 0 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivatives Designated as Hedging Instruments: | Cash flow hedges: | Foreign currency swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 2,737 | 2,524 |
Derivative Asset, Fair Value, Gross Asset | 320 | 211 |
Derivative Liability, Fair Value, Gross Liability | 16 | 30 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 103,126 | 90,249 |
Derivative Asset, Fair Value, Gross Asset | 4,144 | 2,567 |
Derivative Liability, Fair Value, Gross Liability | 2,220 | 2,082 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Interest rate swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 8,731 | 10,747 |
Derivative Asset, Fair Value, Gross Asset | 1,049 | 528 |
Derivative Liability, Fair Value, Gross Liability | 32 | 558 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Interest rate caps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 3,350 | 3,350 |
Derivative Asset, Fair Value, Gross Asset | 2 | 21 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Interest rate futures | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 0 | 54 |
Derivative Asset, Fair Value, Gross Asset | 0 | 0 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Interest rate options | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 27,250 | 17,168 |
Derivative Asset, Fair Value, Gross Asset | 1,771 | 168 |
Derivative Liability, Fair Value, Gross Liability | 375 | 61 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Interest rate forwards | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 4,143 | 0 |
Derivative Asset, Fair Value, Gross Asset | 241 | 0 |
Derivative Liability, Fair Value, Gross Liability | 15 | 0 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Foreign currency swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 1,078 | 1,409 |
Derivative Asset, Fair Value, Gross Asset | 146 | 101 |
Derivative Liability, Fair Value, Gross Liability | 13 | 18 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Foreign currency forwards | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 118 | 125 |
Derivative Asset, Fair Value, Gross Asset | 2 | 0 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Credit default swaps — purchased | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 12 | 98 |
Derivative Asset, Fair Value, Gross Asset | 0 | 3 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Credit default swaps — written | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 1,734 | 1,820 |
Derivative Asset, Fair Value, Gross Asset | 31 | 14 |
Derivative Liability, Fair Value, Gross Liability | 0 | 3 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Equity futures | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 0 | 169 |
Derivative Asset, Fair Value, Gross Asset | 0 | 0 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Equity index options | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 46,099 | 45,815 |
Derivative Asset, Fair Value, Gross Asset | 766 | 1,372 |
Derivative Liability, Fair Value, Gross Liability | 1,503 | 1,207 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Equity variance swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 5,574 | 5,574 |
Derivative Asset, Fair Value, Gross Asset | 95 | 80 |
Derivative Liability, Fair Value, Gross Liability | 249 | 232 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | Equity total return swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Notional Amount | 5,037 | 3,920 |
Derivative Asset, Fair Value, Gross Asset | 41 | 280 |
Derivative Liability, Fair Value, Gross Liability | 33 | 3 |
Ceded Guaranteed Minimum Benefit | ||
Derivatives, Fair Value [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Asset | 303 | 228 |
Embedded Derivative, Fair Value of Embedded Derivative Liability | 0 | 0 |
Direct Guaranteed Minimum Benefit | ||
Derivatives, Fair Value [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Asset | 0 | 0 |
Embedded Derivative, Fair Value of Embedded Derivative Liability | 2,391 | 1,642 |
Direct index-linked annuities | ||
Derivatives, Fair Value [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Asset | 0 | 0 |
Embedded Derivative, Fair Value of Embedded Derivative Liability | 1,566 | 488 |
Direct index-linked annuities | Assumed | ||
Derivatives, Fair Value [Line Items] | ||
Embedded Derivative, Fair Value of Embedded Derivative Asset | 0 | 0 |
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 316 | $ 96 |
Derivatives Derivatives (Deriva
Derivatives Derivatives (Derivatives Pertaining to Hedged Items) (Details) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | $ (3) | $ (1) | $ (29) | $ 8 |
Amount of Gains (Losses) deferred in AOCI | 160 | (7) | 201 | 28 |
Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | (3) | (3) | (6) | (4) |
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | 0 | 0 |
Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | (23) | 0 |
Amount of Gains (Losses) deferred in AOCI | 160 | (7) | 201 | 28 |
Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 2 | 12 | ||
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | ||
Net Derivative Gains (Losses) Recognized for Derivatives | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 1,060 | (690) | (68) | (1,345) |
Net Derivative Gains (Losses) Recognized for Derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 1,060 | (734) | (115) | (1,394) |
Net Derivative Gains (Losses) Recognized for Derivatives | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 46 | 47 | 61 |
Net Derivative Gains (Losses) Recognized for Derivatives | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | (2) | (12) | ||
Net Investment Income | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 10 | 9 | 28 | 24 |
Net Investment Income | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Net Investment Income | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 10 | 9 | 28 | 23 |
Net Investment Income | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 1 | ||
Policyholder benefits and claims | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | (2) | 0 | (4) |
Policyholder benefits and claims | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | (2) | 0 | (4) |
Policyholder benefits and claims | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Policyholder benefits and claims | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | ||
Interest rate derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | 0 | 0 |
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | 0 | 0 |
Interest rate derivatives | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | 0 | 0 |
Amount of Gains (Losses) deferred in AOCI | 51 | (3) | 51 | (5) |
Interest rate derivatives | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 2 | 12 | ||
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | ||
Interest rate derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 1,657 | (266) | 2,906 | (1,190) |
Interest rate derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 46 | 28 | 62 |
Interest rate derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | (2) | (12) | ||
Interest rate derivatives | Net Investment Income | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Interest rate derivatives | Net Investment Income | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 1 | 1 | 2 | 4 |
Interest rate derivatives | Net Investment Income | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 1 | ||
Interest rate derivatives | Policyholder benefits and claims | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Interest rate derivatives | Policyholder benefits and claims | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Interest rate derivatives | Policyholder benefits and claims | Fair value hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | ||
Foreign currency exchange rate derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | (3) | (3) | (6) | (4) |
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | 0 | 0 |
Foreign currency exchange rate derivatives | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | (23) | 0 |
Amount of Gains (Losses) deferred in AOCI | 109 | (4) | 150 | 33 |
Foreign currency exchange rate derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 49 | 6 | 71 | 29 |
Foreign currency exchange rate derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 19 | (1) |
Foreign currency exchange rate derivatives | Net Investment Income | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Foreign currency exchange rate derivatives | Net Investment Income | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 9 | 8 | 26 | 19 |
Foreign currency exchange rate derivatives | Policyholder benefits and claims | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Foreign currency exchange rate derivatives | Policyholder benefits and claims | Cash flow hedges: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Credit derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | 0 | 0 |
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | 0 | 0 |
Credit derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 2 | 11 | 32 | 7 |
Credit derivatives | Net Investment Income | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Credit derivatives | Policyholder benefits and claims | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Equity derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | 0 | 0 |
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | 0 | 0 |
Equity derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | (18) | (447) | (1,808) | (904) |
Equity derivatives | Net Investment Income | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Equity derivatives | Policyholder benefits and claims | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Embedded derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net Derivative Gains (Losses) Recognized for Hedged Items | 0 | 0 | 0 | 0 |
Amount of Gains (Losses) deferred in AOCI | 0 | 0 | 0 | 0 |
Embedded derivatives | Net Derivative Gains (Losses) Recognized for Derivatives | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | (630) | (38) | (1,316) | 664 |
Embedded derivatives | Net Investment Income | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | 0 | 0 | 0 |
Embedded derivatives | Policyholder benefits and claims | Derivatives Not Designated or Not Qualifying as Hedging Instruments: | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | $ 0 | $ (2) | $ 0 | $ (4) |
Derivatives (Credit Derivatives
Derivatives (Credit Derivatives) (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Credit Derivatives [Line Items] | ||
Estimated Fair Value of Credit Default Swaps | $ 31 | $ 11 |
Maximum Amount of Future Payments under Credit Default Swaps | $ 1,734 | $ 1,820 |
Weighted Average Years to Maturity (2) | 4 years 3 months 18 days | 3 years 10 months 24 days |
Credit default swaps | Aaa/Aa/A | ||
Credit Derivatives [Line Items] | ||
Estimated Fair Value of Credit Default Swaps | $ 9 | $ 8 |
Maximum Amount of Future Payments under Credit Default Swaps | $ 615 | $ 689 |
Weighted Average Years to Maturity (2) | 2 years 4 months 24 days | 2 years |
Credit default swaps | Baa | ||
Credit Derivatives [Line Items] | ||
Estimated Fair Value of Credit Default Swaps | $ 22 | $ 3 |
Maximum Amount of Future Payments under Credit Default Swaps | $ 1,119 | $ 1,131 |
Weighted Average Years to Maturity (2) | 5 years 3 months 18 days | 5 years |
Derivatives (Derivatives Asset
Derivatives (Derivatives Asset and Liability after Master Netting Arrangement or a Similar Arrangement) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Offsetting Derivative Assets [Abstract] | ||
Derivative Asset, Fair Value, Amount Not Offset Against Collateral | $ 4,575 | $ 2,833 |
Derivative Asset, Not Offset, Policy Election Deduction | (1,599) | (1,671) |
Derivative Asset, Collateral, Obligation to Return Cash, Offset | (1,851) | (1,062) |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 1,125 | 100 |
Derivative Asset, Collateral, Obligation to Return Securities, Offset | (1,089) | (86) |
Derivative Asset, Fair Value, Offset Against Collateral, Net of Not Subject to Master Netting Arrangement, Policy Election | 36 | 14 |
Offsetting Derivative Liabilities [Abstract] | ||
Derivative Liability, Fair Value, Amount Not Offset Against Collateral | 2,232 | 2,104 |
Derivative Liability, Not Offset, Policy Election Deduction | (1,599) | (1,671) |
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | 0 | 0 |
Derivative Liability, Fair Value, Amount Offset Against Collateral | 633 | 433 |
Derivative Liability, Collateral, Right to Reclaim Securities, Offset | (633) | (433) |
Derivative Liability, Fair Value, Offset Against Collateral, Net of Not Subject to Master Netting Arrangement, Policy Election | $ 0 | $ 0 |
Derivatives Derivatives (Estima
Derivatives Derivatives (Estimated Fair Value of OTC-Bilateral Derivatives) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||
Estimated Fair Value of Derivatives in Net Liability Position | $ 633 | $ 433 |
Fixed Maturity Securities | ||
Derivative [Line Items] | ||
Estimated Fair Value of Collateral Provided | $ 1,250 | $ 797 |
Derivatives (Derivatives Pertai
Derivatives (Derivatives Pertaining to Hedged Items - Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | $ 416 | $ 264 |
Fair Value (Recurring Fair Valu
Fair Value (Recurring Fair Value Measurements) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Assets [Abstract] | ||
Fixed maturity securities | $ 70,723 | $ 62,608 |
Equity securities | 148 | 140 |
Short-term Investments | 1,985 | 0 |
Derivative assets: (1) | 4,818 | 3,006 |
Embedded derivatives within asset host contracts | 303 | 228 |
Separate account assets | 103,928 | 98,256 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 6,509 | 4,338 |
Embedded derivatives within liability host contracts | 4,273 | 2,226 |
Recurring | ||
Assets [Abstract] | ||
Fixed maturity securities | 70,723 | 62,608 |
Equity securities | 148 | 140 |
Short-term Investments | 1,985 | |
Derivative assets: (1) | 4,515 | 2,778 |
Embedded derivatives within asset host contracts | 303 | 228 |
Separate account assets | 103,928 | 98,256 |
Total assets | 181,602 | 164,010 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 2,236 | 2,112 |
Embedded derivatives within liability host contracts | 4,273 | 2,226 |
Total liabilities | 6,509 | 4,338 |
Recurring | Interest rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 3,114 | 717 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 422 | 619 |
Recurring | Foreign currency exchange rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 468 | 312 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 29 | 48 |
Recurring | Credit | ||
Assets [Abstract] | ||
Derivative assets: (1) | 31 | 17 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 3 | |
Recurring | Equity market | ||
Assets [Abstract] | ||
Derivative assets: (1) | 902 | 1,732 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 1,785 | 1,442 |
Recurring | U.S. corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 30,902 | 24,473 |
Recurring | U.S. government and agency | ||
Assets [Abstract] | ||
Fixed maturity securities | 7,746 | 9,095 |
Recurring | RMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 9,215 | 8,547 |
Recurring | Foreign corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 9,650 | 8,026 |
Recurring | State and political subdivision | ||
Assets [Abstract] | ||
Fixed maturity securities | 3,989 | 3,597 |
Recurring | ABS | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,917 | 2,126 |
Recurring | CMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 5,579 | 5,248 |
Recurring | Foreign government | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,725 | 1,496 |
Recurring | Level 1 | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,667 | 2,722 |
Equity securities | 11 | 13 |
Short-term Investments | 1,299 | |
Derivative assets: (1) | 0 | 0 |
Embedded derivatives within asset host contracts | 0 | 0 |
Separate account assets | 224 | 217 |
Total assets | 3,201 | 2,952 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 0 | 0 |
Embedded derivatives within liability host contracts | 0 | 0 |
Total liabilities | 0 | 0 |
Recurring | Level 1 | Interest rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 0 | 0 |
Recurring | Level 1 | Foreign currency exchange rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 0 | 0 |
Recurring | Level 1 | Credit | ||
Assets [Abstract] | ||
Derivative assets: (1) | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 0 | |
Recurring | Level 1 | Equity market | ||
Assets [Abstract] | ||
Derivative assets: (1) | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 0 | 0 |
Recurring | Level 1 | U.S. corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 1 | U.S. government and agency | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,667 | 2,722 |
Recurring | Level 1 | RMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 1 | Foreign corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 1 | State and political subdivision | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 1 | ABS | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 1 | CMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 1 | Foreign government | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 2 | ||
Assets [Abstract] | ||
Fixed maturity securities | 67,982 | 58,907 |
Equity securities | 133 | 124 |
Short-term Investments | 686 | |
Derivative assets: (1) | 4,394 | 2,662 |
Embedded derivatives within asset host contracts | 0 | 0 |
Separate account assets | 103,704 | 98,038 |
Total assets | 176,899 | 159,731 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 1,984 | 1,874 |
Embedded derivatives within liability host contracts | 0 | 0 |
Total liabilities | 1,984 | 1,874 |
Recurring | Level 2 | Interest rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 3,114 | 717 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 422 | 619 |
Recurring | Level 2 | Foreign currency exchange rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 455 | 301 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 28 | 48 |
Recurring | Level 2 | Credit | ||
Assets [Abstract] | ||
Derivative assets: (1) | 22 | 10 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 2 | |
Recurring | Level 2 | Equity market | ||
Assets [Abstract] | ||
Derivative assets: (1) | 803 | 1,634 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 1,534 | 1,205 |
Recurring | Level 2 | U.S. corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 30,466 | 24,150 |
Recurring | Level 2 | U.S. government and agency | ||
Assets [Abstract] | ||
Fixed maturity securities | 6,079 | 6,373 |
Recurring | Level 2 | RMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 9,138 | 8,541 |
Recurring | Level 2 | Foreign corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 9,260 | 7,617 |
Recurring | Level 2 | State and political subdivision | ||
Assets [Abstract] | ||
Fixed maturity securities | 3,916 | 3,523 |
Recurring | Level 2 | ABS | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,853 | 2,087 |
Recurring | Level 2 | CMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 5,545 | 5,120 |
Recurring | Level 2 | Foreign government | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,725 | 1,496 |
Recurring | Level 3 | ||
Assets [Abstract] | ||
Fixed maturity securities | 1,074 | 979 |
Equity securities | 4 | 3 |
Short-term Investments | 0 | |
Derivative assets: (1) | 121 | 116 |
Embedded derivatives within asset host contracts | 303 | 228 |
Separate account assets | 0 | 1 |
Total assets | 1,502 | 1,327 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 252 | 238 |
Embedded derivatives within liability host contracts | 4,273 | 2,226 |
Total liabilities | 4,525 | 2,464 |
Recurring | Level 3 | Interest rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 0 | 0 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 0 | 0 |
Recurring | Level 3 | Foreign currency exchange rate | ||
Assets [Abstract] | ||
Derivative assets: (1) | 13 | 11 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 1 | 0 |
Recurring | Level 3 | Credit | ||
Assets [Abstract] | ||
Derivative assets: (1) | 9 | 7 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 1 | |
Recurring | Level 3 | Equity market | ||
Assets [Abstract] | ||
Derivative assets: (1) | 99 | 98 |
Liabilities [Abstract] | ||
Derivative liabilities: (1) | 251 | 237 |
Recurring | Level 3 | U.S. corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 436 | 323 |
Recurring | Level 3 | U.S. government and agency | ||
Assets [Abstract] | ||
Fixed maturity securities | 0 | 0 |
Recurring | Level 3 | RMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 77 | 6 |
Recurring | Level 3 | Foreign corporate | ||
Assets [Abstract] | ||
Fixed maturity securities | 390 | 409 |
Recurring | Level 3 | State and political subdivision | ||
Assets [Abstract] | ||
Fixed maturity securities | 73 | 74 |
Recurring | Level 3 | ABS | ||
Assets [Abstract] | ||
Fixed maturity securities | 64 | 39 |
Recurring | Level 3 | CMBS | ||
Assets [Abstract] | ||
Fixed maturity securities | 34 | 128 |
Recurring | Level 3 | Foreign government | ||
Assets [Abstract] | ||
Fixed maturity securities | $ 0 | $ 0 |
Fair Value (Asset and Liabiliti
Fair Value (Asset and Liabilities Measured - Quantitative Information) (Details) - Level 3 | Sep. 30, 2019 | Dec. 31, 2018 |
Measurement Input, Mortality Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.0002 | 0.0002 |
Measurement Input, Mortality Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.1131 | 0.1131 |
Measurement Input, Lapse Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.0025 | 0.0025 |
Measurement Input, Lapse Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.1600 | 0.1600 |
Measurement Input, Utilization Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0 | 0 |
Measurement Input, Utilization Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.2500 | 0.2500 |
Measurement Input, Withdrawal Rate | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.0025 | 0.0025 |
Measurement Input, Withdrawal Rate | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.1000 | 0.1000 |
Measurement Input, Long Term Equity Volatilities | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.1650 | 0.1650 |
Measurement Input, Long Term Equity Volatilities | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.2200 | 0.2200 |
Measurement Input, Entity Credit Risk | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.0061 | 0.0191 |
Measurement Input, Entity Credit Risk | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Embedded Derivative Liability, Measurement Input | 0.0237 | 0.0266 |
Fair Value (Unobservable Input
Fair Value (Unobservable Input Reconciliation) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Net Derivatives (2) | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Balance, beginning of period | $ (134) | $ (284) | $ (122) | $ (279) |
Total realized/unrealized gains (losses) included in net income (loss) (5) (6) | (2) | (4) | (10) | (12) |
Total realized/unrealized gains (losses) included in AOCI | 3 | 0 | 5 | 0 |
Purchases (7) | 0 | 0 | 0 | 3 |
Sales (7) | 0 | 0 | 0 | 0 |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 0 | 0 | 0 | 0 |
Transfers out of Level 3 (8) | 2 | 0 | (4) | 0 |
Balance, end of period | (131) | (288) | (131) | (288) |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | (2) | (4) | (11) | (12) |
Embedded derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Balance, beginning of period | (3,121) | (1,241) | (1,998) | (1,660) |
Total realized/unrealized gains (losses) included in net income (loss) (5) (6) | (630) | (40) | (1,316) | 660 |
Total realized/unrealized gains (losses) included in AOCI | 0 | 0 | 0 | 0 |
Purchases (7) | 0 | 0 | 0 | 0 |
Sales (7) | 0 | 0 | 0 | 0 |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | (219) | (154) | (656) | (435) |
Transfers into Level 3 (8) | 0 | 0 | 0 | 0 |
Transfers out of Level 3 (8) | 0 | 0 | 0 | 0 |
Balance, end of period | (3,970) | (1,435) | (3,970) | (1,435) |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | (705) | (37) | (1,531) | 867 |
Corporate (1) | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 765 | 1,872 | 732 | 1,997 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | 0 | 0 | 2 |
Total realized/unrealized gains (losses) included in AOCI | 0 | (44) | 11 | (121) |
Purchases (7) | 118 | 56 | 179 | 164 |
Sales (7) | (22) | (51) | (78) | (184) |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 49 | 20 | 147 | 20 |
Transfers out of Level 3 (8) | (84) | (208) | (165) | (233) |
Balance, end of period | 826 | 1,645 | 826 | 1,645 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | 0 | 0 | 0 | (1) |
Structured Securities | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 108 | 1,268 | 173 | 1,230 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | 10 | 1 | 21 |
Total realized/unrealized gains (losses) included in AOCI | 1 | (8) | 3 | (10) |
Purchases (7) | 61 | 287 | 75 | 339 |
Sales (7) | (6) | (114) | (24) | (229) |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 29 | 3 | 92 | 0 |
Transfers out of Level 3 (8) | (18) | (172) | (145) | (77) |
Balance, end of period | 175 | 1,274 | 175 | 1,274 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | 0 | 4 | 1 | 14 |
State and Political Subdivision | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 74 | 8 | 74 | 0 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | 2 | 0 | 0 |
Total realized/unrealized gains (losses) included in AOCI | 0 | (2) | 0 | 0 |
Purchases (7) | 0 | 0 | 0 | 0 |
Sales (7) | (1) | (6) | (1) | 0 |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 0 | 0 | 0 | 0 |
Transfers out of Level 3 (8) | 0 | (2) | 0 | 0 |
Balance, end of period | 73 | 0 | 73 | 0 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | 0 | 0 | 0 | 0 |
Foreign Government | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 0 | 0 | 0 | 5 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | 0 | 0 | 0 |
Total realized/unrealized gains (losses) included in AOCI | 0 | 0 | 0 | 0 |
Purchases (7) | 0 | 0 | 0 | 0 |
Sales (7) | 0 | 0 | 0 | 0 |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 0 | 0 | 0 | 0 |
Transfers out of Level 3 (8) | 0 | 0 | 0 | (5) |
Balance, end of period | 0 | 0 | 0 | 0 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | 0 | 0 | 0 | 0 |
Equity Securities | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 4 | 120 | 3 | 124 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | (2) | 0 | (4) |
Total realized/unrealized gains (losses) included in AOCI | 0 | 0 | 0 | 0 |
Purchases (7) | 0 | 0 | 0 | 0 |
Sales (7) | 0 | 0 | 0 | (3) |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 0 | 9 | 1 | 10 |
Transfers out of Level 3 (8) | 0 | (5) | 0 | (5) |
Balance, end of period | 4 | 122 | 4 | 122 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | 0 | 0 | 0 | (4) |
Short-term Investments | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 6 | 0 | 0 | 14 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | 0 | 0 | 0 |
Total realized/unrealized gains (losses) included in AOCI | 0 | 0 | 0 | 0 |
Purchases (7) | 0 | 0 | 0 | 0 |
Sales (7) | (6) | 0 | 0 | (14) |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | 0 |
Transfers into Level 3 (8) | 0 | 0 | 0 | 0 |
Transfers out of Level 3 (8) | 0 | 0 | 0 | 0 |
Balance, end of period | 0 | 0 | 0 | 0 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | 0 | 0 | 0 | 0 |
Separate Account Assets (4) | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance, beginning of period | 0 | 4 | 1 | 5 |
Total realized/unrealized gains (losses) included in net income (loss) (6) (7) | 0 | 0 | 0 | 0 |
Total realized/unrealized gains (losses) included in AOCI | 0 | 0 | 0 | 0 |
Purchases (7) | 0 | 1 | 0 | 1 |
Sales (7) | 0 | 0 | (1) | (1) |
Issuances (7) | 0 | 0 | 0 | 0 |
Settlements (7) | 0 | 0 | 0 | (1) |
Transfers into Level 3 (8) | 0 | 0 | 0 | 0 |
Transfers out of Level 3 (8) | 0 | (1) | 0 | 0 |
Balance, end of period | 0 | 4 | 0 | 4 |
Changes in unrealized gains (losses) included in net income (loss) for the instruments still held at end of period | $ 0 | $ 0 | $ 0 | $ 0 |
Fair Value (Financial Instrumen
Fair Value (Financial Instruments Carried at Other Than Fair Value) (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Assets | ||
Policy loans | $ 1,332 | $ 1,421 |
Liabilities | ||
Separate account liabilities | 103,928 | 98,256 |
Carrying Value | ||
Assets | ||
Mortgage loans | 15,359 | 13,694 |
Policy loans | 1,332 | 1,421 |
Other invested assets | 63 | 77 |
Premiums, reinsurance and other receivables | 1,786 | 1,609 |
Liabilities | ||
Policyholder account balances | 15,611 | 15,332 |
Long-term debt | 4,365 | 3,963 |
Other liabilities | 862 | 330 |
Separate account liabilities | 1,126 | 1,029 |
Estimated Fair Value | ||
Assets | ||
Mortgage loans | 16,073 | 13,860 |
Policy loans | 1,649 | 1,615 |
Other invested assets | 63 | 77 |
Premiums, reinsurance and other receivables | 2,198 | 1,696 |
Liabilities | ||
Policyholder account balances | 15,818 | 13,861 |
Long-term debt | 4,283 | 3,358 |
Other liabilities | 862 | 330 |
Separate account liabilities | 1,126 | 1,029 |
Estimated Fair Value | Level 1 | ||
Assets | ||
Mortgage loans | 0 | 0 |
Policy loans | 0 | 0 |
Other invested assets | 0 | 0 |
Premiums, reinsurance and other receivables | 0 | 0 |
Liabilities | ||
Policyholder account balances | 0 | 0 |
Long-term debt | 0 | 0 |
Other liabilities | 0 | 0 |
Separate account liabilities | 0 | 0 |
Estimated Fair Value | Level 2 | ||
Assets | ||
Mortgage loans | 0 | 0 |
Policy loans | 555 | 656 |
Other invested assets | 50 | 64 |
Premiums, reinsurance and other receivables | 47 | 32 |
Liabilities | ||
Policyholder account balances | 0 | 0 |
Long-term debt | 3,283 | 2,758 |
Other liabilities | 640 | 118 |
Separate account liabilities | 1,126 | 1,029 |
Estimated Fair Value | Level 3 | ||
Assets | ||
Mortgage loans | 16,073 | 13,860 |
Policy loans | 1,094 | 959 |
Other invested assets | 13 | 13 |
Premiums, reinsurance and other receivables | 2,151 | 1,664 |
Liabilities | ||
Policyholder account balances | 15,818 | 13,861 |
Long-term debt | 1,000 | 600 |
Other liabilities | 222 | 212 |
Separate account liabilities | $ 0 | $ 0 |
Long-term Debt - Narrative (Det
Long-term Debt - Narrative (Details) - USD ($) $ in Millions | Feb. 01, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | May 07, 2019 |
Debt Instrument [Line Items] | ||||
Proceeds from issuance of long-term debt | $ 1,000 | $ 375 | ||
Repayments of long-term debt | $ 601 | $ 9 | ||
Revolving Credit Facility Maturing 2024 | ||||
Debt Instrument [Line Items] | ||||
Credit facilities, maximum borrowing capacity | $ 1,000 | |||
Revolving Credit Facility Maturing 2019 | ||||
Debt Instrument [Line Items] | ||||
Credit facilities, maximum borrowing capacity | $ 2,000 | |||
Term Loan Due 2024 | ||||
Debt Instrument [Line Items] | ||||
Credit facilities, maximum borrowing capacity | $ 1,000 | |||
Proceeds from issuance of long-term debt | 1,000 | |||
Term Loan Due 2019 | ||||
Debt Instrument [Line Items] | ||||
Repayments of long-term debt | $ 600 |
Equity (Components Accumulated
Equity (Components Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | $ 2,702 | $ 815 | $ 716 | $ 1,676 | |
Cumulative effect of change in accounting principle, net of income tax | $ (4) | ||||
Restated balance, beginning of period | 3,567 | 815 | 3,567 | 552 | 1,676 |
OCI before reclassifications | 1,127 | (324) | 3,717 | (1,418) | |
Deferred income tax benefit (expense) | (237) | 68 | (780) | 318 | |
AOCI before reclassifications, net of income tax | 3,592 | 559 | 3,653 | 497 | |
Amounts reclassified from AOCI | (31) | (9) | (108) | 73 | |
Deferred income tax benefit (expense) | 6 | 2 | 22 | (18) | |
Amounts reclassified from AOCI, net of income tax | (25) | (7) | (86) | 55 | |
Balance, end of period | 3,567 | 552 | 3,567 | 552 | |
Unrealized Investment Gains (Losses), Net of Related Offsets (1) | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | 2,564 | 690 | 576 | 1,572 | |
Cumulative effect of change in accounting principle, net of income tax | (79) | ||||
Restated balance, beginning of period | 2,564 | 690 | 3,306 | 1,572 | 1,572 |
OCI before reclassifications | 970 | (310) | 3,515 | (1,448) | |
Deferred income tax benefit (expense) | (204) | 66 | (738) | 325 | |
AOCI before reclassifications, net of income tax | 3,330 | 446 | 3,353 | 370 | |
Amounts reclassified from AOCI | (30) | 38 | (59) | 138 | |
Deferred income tax benefit (expense) | 6 | (8) | 12 | (32) | |
Amounts reclassified from AOCI, net of income tax | (24) | 30 | (47) | 106 | |
Balance, end of period | 3,306 | 476 | 3,306 | 476 | |
Unrealized Gains (Losses) on Derivatives | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | 181 | 168 | 187 | 154 | |
Cumulative effect of change in accounting principle, net of income tax | 0 | ||||
Restated balance, beginning of period | 181 | 168 | 307 | 154 | 154 |
OCI before reclassifications | 160 | (7) | 201 | 28 | |
Deferred income tax benefit (expense) | (33) | 1 | (42) | (6) | |
AOCI before reclassifications, net of income tax | 308 | 162 | 346 | 176 | |
Amounts reclassified from AOCI | (1) | (47) | (49) | (65) | |
Deferred income tax benefit (expense) | 0 | 10 | 10 | 14 | |
Amounts reclassified from AOCI, net of income tax | (1) | (37) | (39) | (51) | |
Balance, end of period | 307 | 125 | 307 | 125 | |
Foreign Currency Translation Adjustments | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | (20) | (19) | (27) | (24) | |
Cumulative effect of change in accounting principle, net of income tax | 0 | ||||
Restated balance, beginning of period | (20) | (19) | (23) | (25) | (24) |
OCI before reclassifications | (3) | (7) | 4 | (1) | |
Deferred income tax benefit (expense) | 0 | 1 | 0 | 0 | |
AOCI before reclassifications, net of income tax | (23) | (25) | (23) | (25) | |
Amounts reclassified from AOCI | 0 | 0 | 0 | 0 | |
Deferred income tax benefit (expense) | 0 | 0 | 0 | 0 | |
Amounts reclassified from AOCI, net of income tax | 0 | 0 | 0 | 0 | |
Balance, end of period | (23) | (25) | (23) | (25) | |
Defined Benefit Plans Adjustment | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | (23) | (24) | (20) | (26) | |
Cumulative effect of change in accounting principle, net of income tax | 0 | ||||
Restated balance, beginning of period | (23) | (24) | (23) | (24) | (26) |
OCI before reclassifications | 0 | 0 | (3) | 3 | |
Deferred income tax benefit (expense) | 0 | 0 | 0 | (1) | |
AOCI before reclassifications, net of income tax | (23) | (24) | (23) | (24) | |
Amounts reclassified from AOCI | 0 | 0 | 0 | 0 | |
Deferred income tax benefit (expense) | 0 | 0 | 0 | 0 | |
Amounts reclassified from AOCI, net of income tax | 0 | 0 | 0 | 0 | |
Balance, end of period | $ (23) | $ (24) | $ (23) | (24) | |
AOCI Attributable to Parent | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Cumulative effect of change in accounting principle, net of income tax | (79) | ||||
Restatement adjustment | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | 1,597 | ||||
Restated balance, beginning of period | 1,597 | 1,597 | |||
Restatement adjustment | Unrealized Investment Gains (Losses), Net of Related Offsets (1) | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | 1,493 | ||||
Restated balance, beginning of period | 1,493 | 1,493 | |||
Restatement adjustment | Unrealized Gains (Losses) on Derivatives | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | 154 | ||||
Restated balance, beginning of period | 154 | 154 | |||
Restatement adjustment | Foreign Currency Translation Adjustments | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | (24) | ||||
Restated balance, beginning of period | (24) | (24) | |||
Restatement adjustment | Defined Benefit Plans Adjustment | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance, beginning of period | (26) | ||||
Restated balance, beginning of period | $ (26) | $ (26) |
Equity (Reclassifications Out o
Equity (Reclassifications Out of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Gain (Loss) on Investments | $ 27 | $ (42) | $ 79 | $ (121) | ||
Net Investment Income | 928 | 853 | 2,681 | 2,476 | ||
Gain (Loss) on Derivative Instruments, Net, Pretax | 1,057 | (691) | (97) | (1,337) | ||
Income (loss) before provision for income tax | 804 | (368) | 320 | (798) | ||
Income tax (expense) benefit | 119 | (99) | (14) | (226) | ||
Net income (loss) | 685 | (269) | $ (351) | $ (303) | 334 | (572) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Net income (loss) | 25 | 7 | 86 | (55) | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Net unrealized investment gains (losses): | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Gain (Loss) on Investments | 31 | (36) | 86 | (137) | ||
Net Investment Income | 0 | 0 | 0 | 1 | ||
Gain (Loss) on Derivative Instruments, Net, Pretax | (1) | (2) | (27) | (2) | ||
Income (loss) before provision for income tax | 30 | (38) | 59 | (138) | ||
Income tax (expense) benefit | 6 | (8) | 12 | (32) | ||
Net income (loss) | 24 | (30) | 47 | (106) | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized gains (losses) on derivatives - cash flow hedges: | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Income (loss) before provision for income tax | 1 | 47 | 49 | 65 | ||
Income tax (expense) benefit | 0 | 10 | 10 | 14 | ||
Net income (loss) | 1 | 37 | 39 | 51 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized gains (losses) on derivatives - cash flow hedges: | Interest rate swaps | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Net Investment Income | 1 | 0 | 2 | 2 | ||
Gain (Loss) on Derivative Instruments, Net, Pretax | 0 | 15 | 28 | 31 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized gains (losses) on derivatives - cash flow hedges: | Interest rate forwards | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Net Investment Income | 0 | 1 | 0 | 2 | ||
Gain (Loss) on Derivative Instruments, Net, Pretax | 0 | 31 | 0 | 31 | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized gains (losses) on derivatives - cash flow hedges: | Foreign currency swaps | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | $ 0 | $ 0 | $ 19 | $ (1) |
Equity (Preferred Stock & Commo
Equity (Preferred Stock & Common Stock Repurchase Program - Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | Aug. 15, 2019 | May 15, 2019 | Mar. 25, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | May 03, 2019 |
Equity [Abstract] | |||||||||
Preferred stock, dividend rate | 6.60% | ||||||||
Preferred stock, shares issued | 17,000 | ||||||||
Preferred stock, liquidation preference per share | $ 25,000 | ||||||||
Proceeds from issuance of preferred stock, net of issuance costs | $ 412 | $ 412 | $ 0 | ||||||
Preferred stock issuance costs | $ 13 | ||||||||
Preferred stock dividend declared per share | $ 412.50 | $ 412.50 | |||||||
Preferred stock dividend declared | $ 7 | $ 7 | $ 7 | $ 7 | |||||
Class of Stock [Line Items] | |||||||||
Treasury stock, value acquired | $ (126) | $ (42) | $ (188) | $ (314) | |||||
Authorization Under 10b5-1 Plan | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized amount | $ 400 | ||||||||
Treasury stock, shares acquired | 3,401,947 | 8,395,371 | |||||||
Stock repurchase program, remaining authorized repurchase amount | $ 181 | $ 181 |
Other Revenues and Other Expe_3
Other Revenues and Other Expenses (Other Expenses) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Other Income and Expenses [Abstract] | ||||
Compensation | $ 76 | $ 67 | $ 238 | $ 220 |
Contracted services and other labor costs | 73 | 63 | 185 | 189 |
Transition services agreements | 64 | 70 | 196 | 215 |
Establishment costs | 13 | 87 | 85 | 190 |
Premium and other taxes, licenses and fees | 15 | 12 | 35 | 55 |
Separate account fees | 123 | 133 | 365 | 401 |
Volume related costs, excluding compensation, net of DAC capitalization | 155 | 161 | 472 | 486 |
Interest expense on debt | 49 | 39 | 144 | 113 |
Other | 43 | 33 | 104 | 105 |
Total other expenses | $ 611 | $ 665 | $ 1,824 | $ 1,974 |
Other Revenues and Other Expe_4
Other Revenues and Other Expenses Other Revenues and Other Expenses (Other Revenues - Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Distribution service | ||||
Revenue from Contract with Customer, Including Assessed Tax | $ 84 | $ 91 | $ 251 | $ 275 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders | $ 676 | $ (271) | $ 316 | $ (577) |
Weighted average common shares outstanding - Basic | 110,915,416 | 119,657,443 | 114,195,767 | 119,734,128 |
Dilutive effect of share-based awards | 612,064 | 0 | 546,931 | 0 |
Weighted average common shares outstanding - Diluted | 111,527,480 | 119,657,443 | 114,742,698 | 119,734,128 |
Earnings per common share - Basic | $ 6.09 | $ (2.26) | $ 2.77 | $ (4.82) |
Earnings per common share - Diluted | $ 6.06 | $ (2.26) | $ 2.75 | $ (4.82) |
Antidilutive stock options excluded from the computation of earnings per common share | 196,492 | 196,492 |
Contingencies, Commitments an_2
Contingencies, Commitments and Guarantees (Commitments and Guarantees - Narrative) (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Cumulative maximum indemnities and guarantees contractual limitation | $ 128,000,000 | |
Liabilities for indemnities, guarantees and commitments | 1,000,000 | $ 2,000,000 |
Minimum | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Loss Contingency, Range of Possible Loss, Portion Not Accrued | 0 | |
Indemnities And Guarantees Contractual Limitation Range | 1,000,000 | |
Maximum | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Loss Contingency, Range of Possible Loss, Portion Not Accrued | 10,000,000 | |
Indemnities And Guarantees Contractual Limitation Range | 122,000,000 | |
Mortgage Loan Commitments | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Fair Value Disclosure, Off-balance Sheet Risks, Face Amount, Liability | 235,000,000 | 492,000,000 |
Commitments to Fund Partnership Investments and Private Corporate Bond Investments | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Fair Value Disclosure, Off-balance Sheet Risks, Face Amount, Liability | $ 1,900,000,000 | $ 1,900,000,000 |
Related Party Transactions Rela
Related Party Transactions Related Party Transactions (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Related Party Transactions [Abstract] | ||||
Income (1) | $ 0 | $ 0 | $ 0 | $ (182) |
Expense (2) | $ 0 | $ 0 | $ 0 | $ 133 |