| Schedule of notional value and gross fair value of derivative instruments, including embedded derivatives |
Generally, the Company uses derivatives as economic hedges and accounting hedges. The following table presents the notional value and gross fair value of derivative instruments, including embedded derivatives: | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2026 | | December 31, 2025 | | Notional | Gross Fair Value | Notional | Gross Fair Value | Assets (1) | Liabilities (2) | Assets (1) | Liabilities (2) | | (in millions) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Derivatives not designated as hedging instruments | | | | | | | | Interest rate contracts | $ | 35,864 | | $ | 164 | | $ | 279 | | | $ | 36,011 | | $ | 143 | | $ | 219 | | Equity contracts | 143,275 | | 16,256 | | 9,850 | | | 132,590 | | 12,940 | | 7,997 | | Credit contracts | 2,720 | | 1 | | 1 | | | 3,297 | | 15 | | — | | Foreign exchange contracts | 2,476 | | 20 | | 3 | | | 2,459 | | 24 | | 1 | | | | | | | | | | | Total non-designated hedges | 184,335 | | 16,441 | | 10,133 | | | 174,357 | | 13,122 | | 8,217 | | | | | | | | | | | Embedded derivatives | | | | | | | | | | | | | | | | | IUL | N/A | — | | 1,085 | | | N/A | — | | 1,042 | | | Fixed deferred indexed annuities and deposit receivables | N/A | 54 | | 53 | | | N/A | 59 | | 58 | | Structured variable annuities (3) | N/A | — | | 4,948 | | | N/A | — | | 3,879 | | | SMC | N/A | — | | 3 | | | N/A | — | | 4 | | Total embedded derivatives | N/A | 54 | | 6,089 | | | N/A | 59 | | 4,983 | | Total derivatives | $ | 184,335 | | $ | 16,495 | | $ | 16,222 | | | $ | 174,357 | | $ | 13,181 | | $ | 13,200 | |
N/A Not applicable. (1) The fair value of freestanding derivative assets is included in Other assets and the fair value of ceded embedded derivative assets related to deposit receivables is included in Receivables. (2) The fair value of freestanding derivative liabilities is included in Other liabilities. The fair value of IUL, fixed deferred indexed annuity and structured variable annuity embedded derivatives is included in Policyholder account balances, future policy benefits and claims. The fair value of the SMC embedded derivative liability is included in Customer deposits. (3) The fair value of the structured variable annuity embedded derivatives as of June 30, 2026 included $4.9 billion of individual contracts in a liability position and $1 million of individual contracts in an asset position. The fair value of the structured variable annuity embedded derivatives as of December 31, 2025 included $3.9 billion of individual contracts in a liability position and $1 million of individual contracts in an asset position.
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| Summary of impact of derivatives not designated as hedging instruments, including embedded derivatives |
The following table presents a summary of the impact of derivatives not designated as hedging instruments, including embedded derivatives, on the Consolidated Statements of Operations: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Net Investment Income | Banking and Deposit Interest Expense | Distribution Expenses | Interest Credited to Fixed Accounts | Benefits, Claims, Losses and Settlement Expenses | Change in Fair Value of Market Risk Benefits | | General and Administrative Expense | | (in millions) | Three Months Ended June 30, 2026 | | | | | | | | | | Interest rate contracts | $ | — | | $ | — | | $ | — | | $ | — | | $ | 1 | | $ | (102) | | | $ | — | | | Equity contracts | (10) | | — | | 13 | | 83 | | 1,991 | | (477) | | | 2 | | | Credit contracts | — | | — | | — | | — | | — | | 5 | | | — | | | Foreign exchange contracts | 1 | | — | | — | | — | | — | | (2) | | | (1) | | | | | | | | | | | | IUL embedded derivatives | — | | — | | — | | (99) | | — | | — | | | — | | | Fixed deferred indexed annuity and deposit receivables embedded derivatives | — | | — | | — | | 8 | | — | | — | | | — | | | Structured variable annuity embedded derivatives | — | | — | | — | | — | | (1,993) | | — | | | — | | | SMC embedded derivatives | — | | — | | — | | — | | — | | — | | | — | | | Total gain (loss) | $ | (9) | | $ | — | | $ | 13 | | $ | (8) | | $ | (1) | | $ | (576) | | | $ | 1 | | | | | | | | | | | Three Months Ended June 30, 2025 | | | | | | | | | | Interest rate contracts | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | (52) | | | $ | — | | | Equity contracts | (2) | | 2 | | 116 | | 71 | | 1,094 | | (533) | | | 10 | | | Credit contracts | (2) | | — | | 2 | | — | | — | | (6) | | | — | | | Foreign exchange contracts | — | | — | | — | | — | | — | | (53) | | | 25 | | | | | | | | | | | | IUL embedded derivatives | — | | — | | — | | (27) | | — | | — | | | — | | | Fixed deferred indexed annuity and deposit receivables embedded derivatives | — | | — | | — | | 11 | | — | | — | | | — | | | Structured variable annuity embedded derivatives | — | | — | | — | | — | | (1,086) | | — | | | — | | | SMC embedded derivatives | — | | (2) | | — | | — | | — | | — | | | — | | | Total gain (loss) | $ | (4) | | $ | — | | $ | 118 | | $ | 55 | | $ | 8 | | $ | (644) | | | $ | 35 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | Net Investment Income | Banking and Deposit Interest Expense | Distribution Expenses | Interest Credited to Fixed Accounts | Benefits, Claims, Losses and Settlement Expenses | Change in Fair Value of Market Risk Benefits | | General and Administrative Expense | | (in millions) | Six Months Ended June 30, 2026 | | | | | | | | | | Interest rate contracts | $ | — | | $ | — | | $ | — | | $ | — | | $ | (1) | | $ | (130) | | | $ | — | | | Equity contracts | (7) | | — | | 28 | | 58 | | 1,461 | | (310) | | | 3 | | | Credit contracts | — | | — | | — | | — | | — | | 34 | | | — | | | Foreign exchange contracts | 1 | | — | | — | | — | | — | | 6 | | | (4) | | | | | | | | | | | | | | | | | | | | | IUL embedded derivatives | — | | — | | — | | (76) | | — | | — | | | — | | | Fixed deferred indexed annuity and deposit receivables embedded derivatives | — | | — | | — | | 2 | | — | | — | | | — | | | Structured variable annuity embedded derivatives | — | | — | | — | | — | | (1,488) | | — | | | — | | | SMC embedded derivatives | — | | — | | — | | — | | — | | — | | | — | | | Total gain (loss) | $ | (6) | | $ | — | | $ | 28 | | $ | (16) | | $ | (28) | | $ | (400) | | | $ | (1) | | | | | | | | | | | Six Months Ended June 30, 2025 | | | | | | | | | | Interest rate contracts | $ | — | | $ | — | | $ | — | | $ | — | | $ | 2 | | $ | 68 | | | $ | — | | | Equity contracts | (4) | | 1 | | 41 | | 42 | | 420 | | (286) | | | 5 | | | Credit contracts | (2) | | — | | 4 | | — | | — | | (54) | | | — | | | Foreign exchange contracts | — | | — | | — | | — | | — | | (63) | | | 37 | | | | | | | | | | | | | | | | | | | | | IUL embedded derivatives | — | | — | | — | | 5 | | — | | — | | | — | | | Fixed deferred indexed annuity and deposit receivables embedded derivatives | — | | — | | — | | 10 | | — | | — | | | — | | | Structured variable annuity embedded derivatives | — | | — | | — | | — | | (538) | | — | | | — | | | SMC embedded derivatives | — | | (1) | | — | | — | | — | | — | | | — | | | Total gain (loss) | $ | (6) | | $ | — | | $ | 45 | | $ | 57 | | $ | (116) | | $ | (335) | | | $ | 42 | |
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| Summary of payments to make and receive for options |
The following is a summary of the payments the Company is scheduled to make and receive for these options as of June 30, 2026: | | | | | | | | | | | | | Premiums Payable | | Premiums Receivable | | (in millions) | 2026 (1) | $ | 130 | | | $ | 70 | | | 2027 | 20 | | | — | | | 2028 | 30 | | | — | | | 2029 | 135 | | | — | | 2030 | 217 | | | — | | 2031 | 48 | | | — | | | Total | $ | 580 | | | $ | 70 | |
(1) 2026 amounts represent the amounts payable and receivable for the period from July 1, 2026 to December 31, 2026.
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