v3.25.1
INSURANCE LIABILITIES AND ANNUITY BENEFITS
 3 Months Ended
Mar. 31, 2025
Insurance [Abstract]  
INSURANCE LIABILITIES AND ANNUITY BENEFITS INSURANCE LIABILITIES AND ANNUITY BENEFITS. Insurance liabilities and annuity benefits are comprised of obligations to annuitants and insureds in our run-off insurance operations. Our insurance operations (net of eliminations) generated revenue of $934 million and $879 million, profit was $205 million and $200 million and net income was $163 million and $158 million for the three months ended March 31, 2025 and 2024, respectively. These operations were primarily supported by investment securities, substantially all debt securities, of $37,613 million and $37,352 million, limited partnerships of $4,409 million and $4,321 million, a diversified commercial mortgage loan portfolio collateralized by first liens on U.S. commercial real estate properties of $1,885 million and $1,887 million (net of allowance for credit losses of $40 million and $46 million), and residential mortgage loans of $331 million and $251 million (net of allowance for credit losses of an insignificant amount), as of March 31, 2025 and December 31, 2024, respectively. As of March 31, 2025, the commercial mortgage loan portfolio had one delinquent loan, one non-accrual loan and about one-third of the portfolio was held in the office sector, which had a weighted average loan-to-value ratio of 69%, debt service coverage of 1.7, and an insignificant amount of scheduled maturities through 2026. A summary of our insurance liabilities and annuity benefits is presented below.
March 31, 2025
Long-term careStructured settlement annuitiesLifeOther contractsTotal
Future policy benefit reserves
$24,721 $8,394 $1,004 $347 $34,467 
Investment contracts
— 702 — 603 1,304 
Other
— — 114 539 654 
Total
$24,721 $9,096 $1,118 $1,489 $36,424 
December 31, 2024
Future policy benefit reserves
$24,675 $8,426 $1,018 $357 $34,476 
Investment contracts
— 719 — 621 1,340 
Other
— — 116 277 394 
Total
$24,675 $9,145 $1,134 $1,254 $36,209 
The following tables summarize balances of and changes in future policy benefit reserves.

March 31, 2025March 31, 2024
Present value of expected net premiumsLong-term careStructured settlement annuitiesLifeLong-term careStructured settlement annuitiesLife
Balance, beginning of year$4,144 $— $4,318 $4,063 $— $4,803 
Beginning balance at locked-in discount rate3,991 — 4,415 3,745 — 4,773 
Effect of changes in cash flow assumptions14 — — 17 — — 
Effect of actual variances from expected experience2 — 12 6 — (2)
Adjusted beginning of year balance4,007 — 4,427 3,769 — 4,771 
Interest accrual 54 — 46 51 — 45 
Net premiums collected(97)— (74)(98)— (70)
Effect of foreign currency— — 26 — — (69)
Ending balance at locked-in discount rate3,963 — 4,425 3,721 — 4,678 
Effect of changes in discount rate assumptions176 — (73)211 — (151)
Balance, end of period$4,140 $— $4,352 $3,932 $— $4,527 
Present value of expected future policy benefits
Balance, beginning of year$28,820 $8,426 $5,336 $30,895 $9,357 $5,921 
Beginning balance at locked-in discount rate27,448 8,301 5,411 27,144 8,561 5,847 
Effect of changes in cash flow assumptions(69)— — (7)— — 
Effect of actual variances from expected experience9 3 6 43 (29)(13)
Adjusted beginning of year balance27,388 8,304 5,418 27,180 8,532 5,833 
Interest accrual374 109 56 368 111 55 
Benefit payments(351)(159)(98)(359)(159)(109)
Effect of foreign currency— — 28 — — (73)
Ending balance at locked-in discount rate27,411 8,254 5,404 27,190 8,484 5,707 
  Effect of changes in discount rate assumptions1,450 140 (47)2,465 425 (126)
Balance, end of period$28,861 $8,394 $5,357 $29,654 $8,909 $5,581 
Net future policy benefit reserves$24,721 $8,394 $1,004 $25,722 $8,909 $1,054 
Less: Reinsurance recoverables, net of allowance for credit losses(170)— (197)(165)— (29)
Net future policy benefit reserves, after reinsurance recoverables$24,551 $8,394 $807 $25,557 $8,909 $1,025 
Weighted-average duration of liability (years)(a)11.510.25.212.410.85.3
Weighted-average interest accretion rate5.6%5.4%5.3%5.6%5.4%5.2%
Current discount rate5.6%5.5%5.0%5.2%5.2%5.0%
Gross premiums or assessments recognized during period$117 $— $79 $123 $— $79 
Expected future gross premiums, undiscounted7,448 — 11,350 7,376 — 12,082 
Expected future gross premiums, discounted(a)4,722 — 5,249 4,794 — 5,446 
Expected future benefit payments, undiscounted61,449 18,432 10,314 62,774 19,092 10,935 
Expected future benefit payments, discounted(a)28,861 8,394 5,357 29,654 8,909 5,581 
(a) Determined using the current discount rate as of March 31, 2025 and 2024.

As of March 31, 2025 and 2024, policyholders account balances totaled $1,535 million and $1,686 million, respectively. As our insurance operations are in run-off, changes in policyholder account balances for the three months ended March 31, 2025 and 2024 are primarily attributed to surrenders, withdrawals, and benefit payments of $114 million and $106 million, partially offset by net additions from separate accounts and interest credited of $74 million and $66 million, respectively. Interest on policyholder account balances is generally credited at minimum guaranteed rates, primarily between 3.0% and 6.0% at both March 31, 2025 and 2024.

On February 3, 2025, we closed the Canadian life and health insurance portfolio reinsurance transaction that was announced in 2024. We received a ceding commission of $128 million and the gain was deferred and will be recognized over the remaining life of the policies or earlier if the underlying treaties are novated.

See Notes 3 and 9 for further information related to our run-off insurance operations.