v3.25.2
Insurance
 6 Months Ended
Jun. 30, 2025
Insurance [Abstract]  
Insurance
8. Insurance

Changes in the reserve for unpaid claims and loss adjustment expenses (net of reinsurance recoverables) on our short-duration insurance contracts were as follows:
At or for the
Six Months Ended June 30,
(dollars in millions)20252024
Balance at beginning of period$102 $108 
Less reinsurance recoverables(3)(3)
Net balance at beginning of period99 105 
Additions for losses and loss adjustment expenses incurred to:
Current year100 98 
Prior years *
(7)(9)
Total93 89 
Reductions for losses and loss adjustment expenses paid related to:
Current year(39)(45)
Prior years(59)(45)
Total(98)(90)
Foreign currency translation adjustment1 — 
Net balance at end of period95 104 
Plus reinsurance recoverables3 3 
Balance at end of period$98 $107 
*    At June 30, 2025, there was a redundancy in the prior years’ net reserves due to favorable development of credit disability claims during the period. At June 30, 2024, there was a redundancy in the prior years’ net reserves due to favorable development of collateral protection and credit disability claims during the period.

LIABILITY FOR FUTURE POLICY BENEFITS

The present values of expected net premiums on long-duration insurance contracts were as follows:
At or for the
Six Months Ended June 30,
20252024
(dollars in millions)Term and
 Whole Life		Accidental Death and Disability ProtectionTerm and
 Whole Life		Accidental Death and Disability Protection
Balance at beginning of period$177 $33 $217 $41 
Effect of cumulative changes in discount rate assumptions (beginning of period)(2)— (5)— 
Beginning balance at original discount rate175 33 212 41 
Effect of actual variances from expected experience(5)2 (11)(2)
Adjusted balance at beginning of period170 35 201 39 
Interest accretion4 1 6 1 
Net premiums collected(12)(2)(14)(3)
Ending balance at original discount rate162 34 193 37 
Effect of changes in discount rate assumptions1 (1)1 (1)
Balance at ending of period$163 $33 $194 $36 
The present values of expected future policy benefits on long-duration insurance contracts were as follows:
At or for the
Six Months Ended June 30,
20252024
(dollars in millions)Term and
Whole Life		Accidental Death and Disability ProtectionTerm and
Whole Life		Accidental Death and Disability Protection
Balance at beginning of period$378 $96 $435 $113 
Effect of cumulative changes in discount rate assumptions (beginning of period)(5)2(12)—
Beginning balance at original discount rate37398423113
Effect of actual variances from expected experience(5)4(14)(3)
Adjusted balance at beginning of period368102409110
Net issuances2121
Interest accretion102113
Benefit payments(24)(6)(26)(8)
Ending balance at original discount rate35699396106
Effect of changes in discount rate assumptions3(3)5(3)
Balance at ending of period$359 $96 $401 $103 

The net liabilities for future policy benefits on long-duration insurance contracts were as follows:
At or for the
Six Months Ended June 30,
20252024
(dollars in millions)Term and
Whole Life		Accidental Death and Disability ProtectionTerm and
Whole Life		Accidental Death and Disability Protection
Net liability for future policy benefits$196 $63 $207 $67 
Deferred profit liability11471350
Total net liability for future policy benefits$207 $110 $220 $117 

The weighted-average duration of the liability for future policy benefits was 8 years at June 30, 2025 and June 30, 2024.

The following table reconciles the net liability for future policy benefits to Insurance claims and policyholder liabilities in the condensed consolidated balance sheets:
At or for the
Six Months Ended June 30,
(dollars in millions)20252024
Term and whole life$207 $220 
Accidental death and disability protection110 117 
Other*262 257 
Total insurance claims and policyholder liabilities
$579 $594 
*    Other primarily includes reserves for short-duration contracts that are payable to third-party beneficiaries.
The undiscounted and discounted expected future gross premiums and expected future benefits and expenses for our long-duration insurance contracts were as follows:
At or for the
Six Months Ended June 30,
20252024
(dollars in millions)Term and
Whole Life		Accidental Death and Disability ProtectionTerm and
Whole Life		Accidental Death and Disability Protection
Expected future gross premiums:
Undiscounted$340 $116 $396 $135 
Discounted246 82 284 97 
Expected future benefit payments:
Undiscounted502 144 565 155 
Discounted359 96 401 103 

The revenue and interest accretion related to our long-duration insurance contracts recognized in the condensed consolidated statements of operations were as follows:
At or for the
Six Months Ended June 30,
20252024
(dollars in millions)Term and
Whole Life		Accidental Death and Disability ProtectionTerm and
Whole Life		Accidental Death and Disability Protection
Gross premiums or assessments$24 $8 $26 $9 
Interest accretion$5 $2 $5 $2 

The expected and actual experiences for mortality, morbidity, and lapses of the liability for future policy benefits were as follows:
At or for the
Six Months Ended June 30,
20252024
Term and
Whole Life		Accidental Death and Disability ProtectionTerm and
Whole Life		Accidental Death and Disability Protection
Mortality/Morbidity:
Expected0.39 %0.01 %0.37 %0.01 %
Actual0.41 %0.01 %0.36 %0.01 %
Lapses:
Expected3.60 %1.72 %3.81 %1.91 %
Actual2.81 %2.11 %3.44 %3.00 %

The weighted-average interest rates for the liability of future policy benefits for our long-duration insurance contracts were as follows:
At or for the
Six Months Ended June 30,
20252024
Term and
Whole Life		Accidental Death and Disability ProtectionTerm and
Whole Life		Accidental Death and Disability Protection
Interest accretion rate5.29 %4.86 %5.28 %4.87 %
Current discount rate5.51 %5.61 %5.26 %5.29 %