| Long-duration insurance contracts |
Note 15. Long-duration insurance contracts A summary of our long-duration life, annuity and health insurance benefits liabilities disaggregated by our principal product categories follows (in millions).
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June 30, |
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2025 |
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2024 |
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Periodic payment annuity (“Annuities”) |
$ |
10,457 |
|
|
$ |
10,378 |
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Life and health |
|
4,504 |
|
|
|
4,167 |
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Other |
|
2,904 |
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|
2,955 |
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|
$ |
17,865 |
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|
$ |
17,500 |
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Notes to Consolidated Financial Statements Note 15. Long-duration insurance contracts Reconciliations of the liabilities for each of our principal product categories follow (in millions). The information reflects the changes in discounted present values of expected future policy benefits and expected future net premiums before reinsurance ceded. Net premiums represent the portion of expected gross premiums that are required to provide for future policy benefits and variable expenses.
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Annuities |
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Life and health |
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|
2025 |
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|
2024 |
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|
2025 |
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|
2024 |
|
Expected future policy benefits: |
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Balance at the beginning of the year |
$ |
10,276 |
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|
$ |
11,212 |
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|
$ |
43,784 |
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|
$ |
52,665 |
|
Balance at the beginning of the year - original discount rates |
|
11,757 |
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|
|
11,681 |
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|
55,170 |
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|
65,871 |
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Effect of cash flow assumption changes |
|
— |
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|
— |
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|
(98 |
) |
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|
(324 |
) |
Effect of actual versus expected experience |
|
(20 |
) |
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|
4 |
|
|
|
246 |
|
|
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(12,836 |
) |
Change in benefits, net |
|
(240 |
) |
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|
(235 |
) |
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|
(887 |
) |
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|
(943 |
) |
Interest accrual |
|
277 |
|
|
|
273 |
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|
|
646 |
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|
575 |
|
Foreign currency effect |
|
136 |
|
|
|
15 |
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|
|
1,489 |
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(459 |
) |
Balance at June 30 - original discount rates |
|
11,910 |
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|
11,738 |
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|
56,566 |
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|
51,884 |
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Effect of changes in discount rate assumptions |
|
(1,453 |
) |
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|
(1,360 |
) |
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|
(12,232 |
) |
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|
(12,739 |
) |
Balance at June 30 |
$ |
10,457 |
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|
$ |
10,378 |
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|
$ |
44,334 |
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|
$ |
39,145 |
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Expected future net premiums: |
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Balance at the beginning of the year |
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|
$ |
39,294 |
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|
$ |
46,916 |
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Balance at the beginning of the year - original discount rates |
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|
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|
49,500 |
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|
58,731 |
|
Effect of cash flow assumption changes |
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|
(66 |
) |
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|
(326 |
) |
Effect of actual versus expected experience |
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|
204 |
|
|
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(11,225 |
) |
Change in premiums, net |
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|
|
|
(884 |
) |
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|
(876 |
) |
Interest accrual |
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|
579 |
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|
507 |
|
Foreign currency effect |
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|
1,395 |
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|
(436 |
) |
Balance at June 30 - original discount rates |
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|
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|
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|
50,728 |
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|
|
46,375 |
|
Effect of changes in discount rate assumptions |
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(10,898 |
) |
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|
(11,397 |
) |
Balance at June 30 |
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$ |
39,830 |
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$ |
34,978 |
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Liabilities for future policy benefits: |
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Balance at June 30 |
$ |
10,457 |
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|
$ |
10,378 |
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|
$ |
4,504 |
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|
$ |
4,167 |
|
Reinsurance recoverables |
|
— |
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— |
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|
(51 |
) |
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|
(49 |
) |
Balance at June 30, net of reinsurance recoverables |
$ |
10,457 |
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|
$ |
10,378 |
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$ |
4,453 |
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$ |
4,118 |
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Expected future policy benefits and expected future net premiums declined in the first six months of 2024, primarily attributable to the commutations of certain life reinsurance contracts. The impacts of these contract commutations were included in the effects of actual versus expected experience. Other information relating to our long-duration insurance liabilities follows (dollars in millions).
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Annuities |
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Life and health |
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|
June 30, |
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June 30, |
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|
2025 |
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|
2024 |
|
|
2025 |
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|
2024 |
|
Undiscounted expected future gross premiums |
$ |
— |
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|
$ |
— |
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|
$ |
103,580 |
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$ |
94,942 |
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Discounted expected future gross premiums |
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— |
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|
— |
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|
60,951 |
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|
|
55,787 |
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Undiscounted expected future benefits |
|
30,670 |
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|
|
30,867 |
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|
|
94,173 |
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|
86,253 |
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Weighted average discount rate |
|
5.7 |
% |
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5.7 |
% |
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|
5.2 |
% |
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|
5.2 |
% |
Weighted average accretion rate |
|
4.8 |
% |
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|
4.8 |
% |
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|
2.7 |
% |
|
|
2.7 |
% |
Weighted average duration |
16 years |
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16 years |
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|
13 years |
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|
13 years |
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Notes to Consolidated Financial Statements Note 15. Long-duration insurance contracts Gross premiums earned and interest expense before reinsurance ceded for the first six months of 2025 and 2024 were as follows (in millions).
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Gross premiums |
|
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Interest expense |
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|
2025 |
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|
2024 |
|
|
2025 |
|
|
2024 |
|
Annuities |
$ |
— |
|
|
$ |
— |
|
|
$ |
277 |
|
|
$ |
273 |
|
Life and health |
|
1,961 |
|
|
|
1,870 |
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|
67 |
|
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|
68 |
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