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As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 2/27/20 Genworth Financial Inc 10-K 12/31/19 197:95M Donnelley … Solutions/FA |
Document/Exhibit Description Pages Size 1: 10-K Annual Report HTML 10.19M 2: EX-4.15 Instrument Defining the Rights of Security Holders HTML 91K 3: EX-21 Subsidiaries List HTML 63K 4: EX-23 Consent of Experts or Counsel HTML 55K 5: EX-24 Power of Attorney HTML 59K 6: EX-31.1 Certification -- §302 - SOA'02 HTML 59K 7: EX-31.2 Certification -- §302 - SOA'02 HTML 59K 8: EX-32.1 Certification -- §906 - SOA'02 HTML 56K 9: EX-32.2 Certification -- §906 - SOA'02 HTML 56K 170: R1 Cover Page HTML 116K 100: R2 Condensed Consolidated Balance Sheets HTML 192K 28: R3 Condensed Consolidated Balance Sheets HTML 68K (Parenthetical) 151: R4 Condensed Consolidated Statements of Income HTML 187K 171: R5 Condensed Consolidated Statements of Comprehensive HTML 88K Income 101: R6 Condensed Consolidated Statements of Changes in HTML 97K Equity 31: R7 Condensed Consolidated Statements of Cash Flows HTML 190K 148: R8 Condensed Consolidated Statements of Cash Flows HTML 59K (Parenthetical) 174: R9 Nature of Business and Formation of Genworth HTML 72K 64: R10 Summary of Significant Accounting Policies HTML 245K 37: R11 Earnings (Loss) Per Share HTML 194K 114: R12 Investments HTML 1.95M 180: R13 Derivative Instruments HTML 507K 65: R14 Deferred Acquisition Costs HTML 85K 38: R15 Intangible Assets HTML 116K 116: R16 Reinsurance HTML 199K 182: R17 Insurance Reserves HTML 161K 63: R18 Liability for Policy and Contract Claims HTML 669K 41: R19 Employee Benefit Plans HTML 64K 142: R20 Borrowings and Other Financings HTML 229K 167: R21 Income Taxes HTML 237K 103: R22 Supplemental Cash Flow Information HTML 57K 34: R23 Stock-Based Compensation HTML 268K 143: R24 Fair Value of Financial Instruments HTML 3.20M 168: R25 Variable Interest and Securitization Entities HTML 155K 104: R26 Insurance Subsidiary Financial Information and HTML 126K Regulatory Matters 36: R27 Segment Information HTML 811K 146: R28 Quarterly Results of Operations (Unaudited) HTML 282K 166: R29 Commitments and Contingencies HTML 94K 176: R30 Changes in Accumulated Other Comprehensive Income HTML 228K (Loss) 111: R31 Noncontrolling Interests HTML 64K 44: R32 Sale of Businesses HTML 203K 70: R33 Condensed Consolidating Financial Information HTML 1.91M 175: R34 Schedule I Genworth Financial, Inc. Summary of HTML 104K Investments-Other Than Investments in Related Parties 110: R35 Schedule II Genworth Financial, Inc. (Parent HTML 323K Company Only) 42: R36 Schedule III Supplemental Insurance Information HTML 250K 68: R37 Summary of Significant Accounting Policies HTML 326K (Policies) 177: R38 Summary of Significant Accounting Policies HTML 98K (Tables) 107: R39 Earnings (Loss) Per Share (Tables) HTML 194K 160: R40 Investments (Tables) HTML 1.97M 141: R41 Derivative Instruments (Tables) HTML 515K 17: R42 Deferred Acquisition Costs (Tables) HTML 82K 90: R43 Intangible Assets (Tables) HTML 118K 159: R44 Reinsurance (Tables) HTML 190K 140: R45 Insurance Reserves (Tables) HTML 153K 15: R46 Liability for Policy and Contract Claims (Tables) HTML 673K 88: R47 Borrowings and Other Financings (Tables) HTML 214K 161: R48 Income Taxes (Tables) HTML 266K 137: R49 Stock-Based Compensation (Tables) HTML 266K 125: R50 Fair Value of Financial Instruments (Tables) HTML 3.08M 196: R51 Segment Information (Tables) HTML 809K 71: R52 Changes in Accumulated Other Comprehensive Income HTML 229K (Loss) (Tables) 49: R53 Sale of Businesses (Tables) HTML 205K 126: R54 Variable Interest and Securitization Entities HTML 153K (Tables) 197: R55 Insurance Subsidiary Financial Information and HTML 99K Regulatory Matters (Tables) 73: R56 Quarterly Results of Operations (Unaudited) HTML 282K (Tables) 52: R57 Condensed Consolidating Financial Information HTML 1.91M (Tables) 129: R58 Nature of Business and Formation of Genworth - HTML 70K Additional Information (Detail) 194: R59 Summary of Significant Accounting Policies - HTML 168K Additional Information (Detail) 95: R60 Summary of Significant Accounting Policies - HTML 92K Summary of Components for Cumulative Effect Adjustment (Detail) 20: R61 Earning (Loss) Per Share (Detail) HTML 173K 132: R62 Earning (Loss) Per Share (Parenthetical) (Detail) HTML 60K 152: R63 Net Investment Income (Detail) HTML 89K 98: R64 Net Investment Gains (Losses) (Detail) HTML 91K 23: R65 Investments - Additional Information (Detail) HTML 107K 136: R66 Credit Losses Recognized in Net Income (Loss) on HTML 63K Debt Securities (Detail) 156: R67 Net Unrealized Gains and Losses on HTML 77K Available-for-Sale Investment Securities Reflected as Separate Component of Accumulated Other Comprehensive Income (Loss) (Detail) 93: R68 Change in Net Unrealized Gains (Losses) on HTML 97K Available-for-Sale Securities Reported in Accumulated Other Comprehensive Income (Loss) (Detail) 26: R69 Change in Net Unrealized Gains (Losses) on HTML 61K Available-for-Sale Securities Reported in Accumulated Other Comprehensive Income (Loss) (Parenthetical) (Detail) 60: R70 Amortized Cost or Cost, Gross Unrealized Gains HTML 230K (Losses) and Fair Value of Fixed Maturity and Equity Securities Classified as Available-for-Sale (Detail) 80: R71 Gross Unrealized Losses and Fair Value of HTML 148K Investment Securities (Detail) 191: R72 Gross Unrealized Losses and Fair Value of HTML 199K Corporate Securities Based on Industries (Detail) 121: R73 Scheduled Maturity Distribution of Fixed Maturity HTML 101K Securities (Detail) 57: R74 Distribution Across Property Type and Geographic HTML 109K Region for Commercial Mortgage Loans (Detail) 76: R75 Aging of Past Due Commercial Mortgage Loans by HTML 122K Property Type (Detail) 187: R76 Allowance for Credit Losses and Recorded HTML 85K Investment in Commercial Mortgage Loans (Detail) 117: R77 Loan-to-Value of Commercial Mortgage Loans by HTML 126K Property Type (Detail) 54: R78 Loan-to-Value of Commercial Mortgage Loans by HTML 64K Property Type (Parenthetical) (Detail) 83: R79 Debt Service Coverage Ratio for Fixed Rate HTML 136K Commercial Mortgage Loans by Property Type (Detail) 59: R80 Schedule of Positions in Derivative Instruments HTML 123K (Detail) 79: R81 Activity Associated with Derivative Instruments HTML 103K (Detail) 190: R82 Schedule of Pre-Tax Income (Loss) Effects of Cash HTML 86K Flow Hedges (Detail) 120: R83 Reconciliation of Current Period Changes, Net of HTML 76K Applicable Income Taxes, for Derivatives Qualifying as Hedges (Detail) 58: R84 Reconciliation of Current Period Changes, Net of HTML 64K Applicable Income Taxes, for Derivatives Qualifying as Hedges (Parenthetical) (Detail) 78: R85 Derivative Instruments - Additional Information HTML 67K (Detail) 189: R86 Schedule of Pre-Tax Gain (Loss) Recognized in Net HTML 80K Income (Loss) for Effects of Derivatives not Designated as Hedges (Detail) 119: R87 Additional Information about Derivative Assets and HTML 123K Liabilities Subject to Enforceable Master Netting Arrangement (Detail) 53: R88 Additional Information about Derivative Assets and HTML 61K Liabilities Subject to Enforceable Master Netting Arrangement (Parenthetical) (Detail) 82: R89 Activity Impacting Deferred Acquisition Costs HTML 75K (Detail) 96: R90 Deferred Acquisition Costs - Additional HTML 76K Information (Detail) 21: R91 Intangible Assets (Detail) HTML 71K 133: R92 Intangible Assets - Additional Information HTML 63K (Detail) 153: R93 Activity in Present Value of Future Profits HTML 69K (Detail) 97: R94 Activity in Present Value of Future Profits HTML 58K (Parenthetical) (Detail) 22: R95 Percentage of PVFP Balance Net of Interest HTML 68K Accretion, before Effect of Unrealized Investment Gains or Losses, Estimated to be Amortized Over Next Five years (Detail) 134: R96 Reinsurance - Additional Information (Detail) HTML 91K 154: R97 Net Domestic Life Insurance In-Force (Detail) HTML 69K 94: R98 Effects of Reinsurance on Premiums Written and HTML 96K Earned (Detail) 27: R99 Recorded Liabilities and Major Assumptions HTML 91K Underlying Future Policy Benefits (Detail) 47: R100 Insurance Reserves - Additional Information HTML 109K (Detail) 74: R101 Recorded Liabilities for Policyholder Account HTML 73K Balances (Detail) 192: R102 Information about Variable Annuity Products with HTML 74K Death and Living Benefit Guarantees (Detail) 127: R103 Account Balances of Variable Annuity Contract with HTML 68K Death or Living Benefit Guarantees Invested in Separate Account Investment Options (Detail) 48: R104 Liability for Policy and Contract Claims (Detail) HTML 89K 75: R105 Changes in Liability for Policy and Contract HTML 88K Claims (Detail) 193: R106 Liability for Policy and Contract Claims - HTML 70K Additional Information (Detail) 128: R107 Incurred Claims, Net of Reinsurance, Cumulative HTML 157K Number of Reported Delinquencies and Total of Incurred-But-Not-Reported Liabilities (Detail) 51: R108 Paid Claims Development, Net of Reinsurance HTML 151K (Detail) 72: R109 Average Payout of Incurred Claims by Age (Detail) HTML 88K 87: R110 Employee Benefit Plans - Additional Information HTML 101K (Detail) 19: R111 Borrowings and Other Financings - Long Term HTML 92K Borrowings (Detail) 139: R112 Borrowings and Other Financings - Long Term HTML 86K Borrowings (Parenthetical) (Detail) 163: R113 Borrowings and Other Financings - Additional HTML 171K Information (Detail) 86: R114 Principal Amounts of Long Term Debt Including HTML 73K Senior Notes and Non-recourse Funding by Maturity (Detail) 18: R115 Principal Amounts of Long Term Debt Including HTML 69K Senior Notes and Non-recourse Funding by Maturity (Parenthetical) (Detail) 138: R116 Remaining Contractual Maturity of Agreements HTML 78K (Detail) 162: R117 Components of Income (Loss) before Income Taxes HTML 63K (Detail) 89: R118 Components of Income Tax (Benefit) Expense HTML 87K (Detail) 16: R119 Income Taxes - Additional Information (Detail) HTML 114K 124: R120 Reconciliation of Federal Statutory Tax Rate to HTML 96K Effective Income Tax Rate (Detail) 186: R121 Components Net Deferred Income Tax Liability HTML 108K (Detail) 85: R122 Reconciliation of Unrecognized Tax Benefits HTML 68K (Detail) 56: R123 Supplemental Cash Flow Information - Additional HTML 61K Information (Detail) 122: R124 Stock-Based Compensation - Additional Information HTML 103K (Detail) 185: R125 Stock-Based Compensation - Summary of Cash Award HTML 75K Activity (Detail) 84: R126 Rollforward of Share-Based Compensation HTML 83K Arrangement by Share-Based Payment Award, Options, Outstanding (Detail) 55: R127 Information about Stock Options Outstanding HTML 76K (Detail) 118: R128 Information about Stock Options Outstanding HTML 60K (Parenthetical) (Detail) 188: R129 Stock Option Activity and Other Equity-Based HTML 118K Awards (Detail) 157: R130 Fair Value Financial Instruments Not Required to HTML 115K Be Carried at Fair Value (Detail) 130: R131 Fair Value of Financial Instruments - Additional HTML 96K Information (Detail) 24: R132 Summary of Significant Inputs Used by Third-Party HTML 111K Pricing Services for Certain Fair Value Measurements of Fixed Maturity Securities that Classified as Level 2 (Detail) 91: R133 Assets by Class of Instrument that are Measured at HTML 389K Fair Value on Recurring Basis (Detail) 158: R134 Assets Measured at Fair Value on Recurring Basis HTML 381K and Utilized Significant Unobservable (Level 3) Inputs to Determine Fair Value (Detail) 131: R135 Gains and Losses Included in Net Income (Loss) HTML 66K from Assets Measured at Fair Value (Detail) 25: R136 Summary of Significant Unobservable Inputs Used HTML 209K for Fair Value Measurements Classified As Level 3 (Detail) 92: R137 Liabilities by Class of Instrument that are HTML 116K Measured at Fair Value on Recurring Basis (Detail) 155: R138 Liabilities Measured at Fair Value on Recurring HTML 121K Basis and Utilized Significant Unobservable (Level 3) Inputs to Determine Fair Value (Detail) 135: R139 Gains and Losses Included in Net (Income) from HTML 67K Liabilities Measured at Fair Value (Detail) 183: R140 Variable Interest and Securitization Entities - HTML 67K Additional Information (Detail) 112: R141 Assets and Liabilities Recorded for Consolidated HTML 74K Securitization Entities (Detail) 39: R142 Activity Presented in Consolidated Statement of HTML 116K Income Related to Consolidated Securitization Entities (Detail) 61: R143 Insurance Subsidiary Financial Information and HTML 160K Regulatory Matters - Additional Information (Detail) 184: R144 Schedule of Statutory Accounting Practices HTML 73K (Detail) 113: R145 Segment Information - Additional Information HTML 75K (Detail) 40: R146 Summary of Segments and Corporate and Other HTML 329K Activities (Detail) 62: R147 Summary of Revenues for Segments and Corporate and HTML 90K Other Activities (Detail) 181: R148 Summary of Net Operating Income (Loss) for HTML 190K Segments and Corporate and Other Activities (Detail) 115: R149 Summary of Net Operating Income (Loss) for HTML 61K Segments and Corporate and Other Activities (Parenthetical) (Detail) 150: R150 Schedule of Revenue, Net Income and Assets by HTML 161K Geographic Location (Detail) 172: R151 Quarterly Results of Operations (Detail) HTML 163K 102: R152 Quarterly Results of Operations (Parenthetical) HTML 133K (Detail) 30: R153 Commitments and Contingencies - Additional HTML 103K Information (Detail) 149: R154 Component of Changes in Accumulated Other HTML 98K Comprehensive Income (Loss) (Detail) 169: R155 Changes In Accumulated Other Comprehensive Income HTML 66K (Loss) - Additional Information (Detail) 99: R156 Reclassifications In (Out) of Accumulated Other HTML 89K Comprehensive Income (Loss), Net of Taxes (Detail) 29: R157 Noncontrolling Interests - Additional Information HTML 100K (Detail) 147: R158 Sale of Businesses - Additional Information HTML 74K (Detail) 173: R159 Schedule Of Income Loss On Sale Recorded In Our HTML 80K Disposition Group (Detail) 67: R160 Schedule Of Income Loss On Sale Recorded In Our HTML 68K Disposition Group (Parenthetical) (Detail) 46: R161 Assets and Liabilities Held for Sale Related to HTML 113K Canada Mortgage Insurance Business (Detail) 109: R162 Summary of Operating Results Related to HTML 159K Discontinued Operations (Detail) 179: R163 Summary of Operating Results Related to HTML 64K Discontinued Operations (Parenthetical) (Detail) 66: R164 Condensed Consolidating Balance Sheet (Detail) HTML 255K 45: R165 Condensed Consolidating Balance Sheet (Detail) HTML 58K (Parenthetical) 108: R166 Condensed Consolidating Income Statement (Detail) HTML 247K 178: R167 Condensed Consolidating Statement of Comprehensive HTML 142K Income (Detail) 69: R168 Condensed Consolidating Statement of Cash Flows HTML 483K (Detail) 43: R169 Condensed Consolidating Statement of Cash Flows HTML 57K (Parenthetical) (Detail) 32: R170 Condensed Consolidating Financial Information - HTML 59K Additional Information (Detail) 105: R171 Schedule I Genworth Financial, Inc. Summary of HTML 93K Investments-Other than Investments in Related Parties (Detail) 164: R172 Schedule I Genworth Financial, Inc. Summary of HTML 58K Investments-Other than Investments in Related Parties (Parenthetical) (Detail) 144: R173 Schedule II Genworth Financial, Inc. (Parent HTML 140K Company Only) (Balance Sheets) (Detail) 33: R174 Schedule II Genworth Financial, Inc. (Parent HTML 106K Company Only) (Statements of Income) (Detail) 106: R175 Schedule II Genworth Financial, Inc. (Parent HTML 95K Company Only) (Statements of Comprehensive Income) (Detail) 165: R176 Schedule II Genworth Financial, Inc. (Parent HTML 154K Company Only) (Statements of Cash Flows) (Detail) 145: R177 Schedule II Genworth Financial, Inc. (Parent HTML 93K Company Only) - Additional Information (Detail) 35: R178 Schedule III Genworth Financial, Inc. Supplemental HTML 109K Insurance Information (Schedule of Supplemental Insurance Information) (Detail) 50: XML IDEA XML File -- Filing Summary XML 387K 123: XML XBRL Instance -- d849640d10k_htm XML 34.00M 77: EXCEL IDEA Workbook of Financial Reports XLSX 359K 11: EX-101.CAL XBRL Calculations -- gnw-20191231_cal XML 441K 12: EX-101.DEF XBRL Definitions -- gnw-20191231_def XML 4.04M 13: EX-101.LAB XBRL Labels -- gnw-20191231_lab XML 3.68M 14: EX-101.PRE XBRL Presentations -- gnw-20191231_pre XML 4.15M 10: EX-101.SCH XBRL Schema -- gnw-20191231 XSD 587K 81: JSON XBRL Instance as JSON Data -- MetaLinks 950± 1.62M 195: ZIP XBRL Zipped Folder -- 0001193125-20-051019-xbrl Zip 1.27M
10-K |
i ☒ |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
i ☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
i Delaware |
i 80-0873306 | |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
i 6620 West Broad Street i Richmond , i Virginia
|
i 23230 | |
(Address of principal executive offices) |
(Zip Code) |
Title of Each Class |
Trading Symbol |
Name of each exchange on which registered | ||
i Class A Common Stock , par value $.001 per share |
i GNW |
i New York Stock Exchange |
i Large accelerated filer |
☒ |
Accelerated filer |
☐ | |||
Non-accelerated filer |
☐ |
Smaller reporting company |
i ☐ | |||
Emerging growth company |
i ☐ |
Page |
||||||
PART I |
||||||
Item 1. |
4 |
|||||
Item 1A. |
48 |
|||||
Item 1B. |
85 |
|||||
Item 2. |
85 |
|||||
Item 3. |
85 |
|||||
Item 4. |
85 |
|||||
PART II |
||||||
Item 5. |
86 |
|||||
Item 6. |
88 |
|||||
Item 7. |
92 |
|||||
Item 7A. |
173 |
|||||
Item 8. |
179 |
|||||
Item 9. |
335 |
|||||
Item 9A. |
335 |
|||||
Item 9B. |
338 |
|||||
PART III |
||||||
Item 10. |
339 |
|||||
Item 11. |
343 |
|||||
Item 12. |
343 |
|||||
Item 13. |
343 |
|||||
Item 14. |
343 |
|||||
PART IV |
||||||
Item 15. |
344 |
Item 1. |
Business |
(Amounts in millions) |
Reinsurance recoverable |
|||
UFLIC (1) |
$ | 13,752 |
||
RGA Reinsurance Company |
1,564 |
|||
General Reinsurance Corporation |
492 |
|||
Riversource Life Insurance Company |
440 |
|||
Munich American Reassurance Company |
332 |
(1) |
We have several significant reinsurance transactions with Union Fidelity Life Insurance Company (“UFLIC”), an affiliate of our former parent, General Electric Company (“GE”), which results in a significant concentration of reinsurance risk. UFLIC’s obligations to us are secured by trust accounts. See note 8 in our consolidated financial statements under “Part II—Item 8—Financial Statements and Supplementary Data.” |
Company |
S&P rating |
Moody’s rating | ||
Genworth Mortgage Insurance Corporation |
BB+ (Marginal) |
Baa3 (Adequate) | ||
Genworth Financial Mortgage Insurance Pty Limited (Australia) (1) |
A (Strong) |
N/A |
(1) |
Also rated “A+” by Fitch Ratings, Inc. (“Fitch”). |
Company |
S&P rating |
Moody’s rating |
A.M. Best rating | |||
Genworth Life Insurance Company |
B-(Weak) |
B3 (Poor) |
C++ (Marginal) | |||
Genworth Life and Annuity Insurance Company |
B-(Weak) |
B1 (Poor) |
B (Fair) | |||
Genworth Life Insurance Company of New York |
B-(Weak) |
B3 (Poor) |
C++ (Marginal) |
• | managing interest rate risk, as appropriate, through monitoring asset durations relative to policyholder and contractholder obligations; |
• | selecting assets based on fundamental, research-driven strategies; |
• | emphasizing fixed-income, low-volatility assets while pursuing active strategies to enhance yield; |
• | maintaining sufficient liquidity to meet unexpected financial obligations; |
• | regularly evaluating our asset class mix and pursuing additional investment classes when prudent; and |
• | continuously monitoring asset quality and market conditions that could affect our assets. |
• | credit risk relating to the uncertainty associated with the continued ability of a given issuer to make timely payments of principal and interest and |
• | interest rate risk relating to the market price and cash flow variability associated with changes in market interest rates. |
December 31, |
||||||||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
||||||||||||||||||||||
Amortized |
Fair |
% of |
Amortized |
Fair |
% of |
|||||||||||||||||||
NRSRO designation |
cost |
value |
total |
cost |
value |
total |
||||||||||||||||||
Public fixed maturity securities |
||||||||||||||||||||||||
AAA |
$ | 8,771 |
$ | 10,160 |
24 |
% | $ | 9,369 |
$ | 10,031 |
25 |
% | ||||||||||||
AA |
3,139 |
3,536 |
8 |
3,474 |
3,608 |
9 |
||||||||||||||||||
A |
10,386 |
12,315 |
29 |
10,436 |
11,177 |
28 |
||||||||||||||||||
BBB |
13,398 |
15,041 |
36 |
13,143 |
13,306 |
35 |
||||||||||||||||||
BB |
959 |
1,040 |
3 |
1,180 |
1,149 |
3 |
||||||||||||||||||
B |
41 |
44 |
— |
97 |
93 |
— |
||||||||||||||||||
CCC and lower |
12 |
26 |
— |
14 |
25 |
— |
||||||||||||||||||
Total public fixed maturity securities |
$ | 36,706 |
$ | 42,162 |
100 |
% | $ | 37,713 |
$ | 39,389 |
100 |
% | ||||||||||||
Private fixed maturity securities |
||||||||||||||||||||||||
AAA |
$ | 1,471 |
$ | 1,536 |
8 |
% | $ | 1,506 |
$ | 1,531 |
9 |
% | ||||||||||||
AA |
2,093 |
2,235 |
12 |
1,964 |
1,994 |
12 |
||||||||||||||||||
A |
4,799 |
5,182 |
29 |
4,626 |
4,670 |
29 |
||||||||||||||||||
BBB |
7,755 |
8,305 |
46 |
7,290 |
7,216 |
45 |
||||||||||||||||||
BB |
800 |
844 |
5 |
760 |
733 |
5 |
||||||||||||||||||
B |
76 |
73 |
— |
61 |
54 |
— |
||||||||||||||||||
CCC and lower |
— |
2 |
— |
— |
2 |
— |
||||||||||||||||||
Total private fixed maturity securities |
$ | 16,994 |
$ | 18,177 |
100 |
% | $ | 16,207 |
$ | 16,200 |
100 |
% | ||||||||||||
Total fixed maturity securities |
||||||||||||||||||||||||
AAA |
$ | 10,242 |
$ | 11,696 |
19 |
% | $ | 10,875 |
$ | 11,562 |
21 |
% | ||||||||||||
AA |
5,232 |
5,771 |
10 |
5,438 |
5,602 |
10 |
||||||||||||||||||
A |
15,185 |
17,497 |
29 |
15,062 |
15,847 |
29 |
||||||||||||||||||
BBB |
21,153 |
23,346 |
39 |
20,433 |
20,522 |
37 |
||||||||||||||||||
BB |
1,759 |
1,884 |
3 |
1,940 |
1,882 |
3 |
||||||||||||||||||
B |
117 |
117 |
— |
158 |
147 |
— |
||||||||||||||||||
CCC and lower |
12 |
28 |
— |
14 |
27 |
— |
||||||||||||||||||
Total fixed maturity securities |
$ | 53,700 |
$ | 60,339 |
100 |
% | $ | 53,920 |
$ | 55,589 |
100 |
% | ||||||||||||
• | 10% of the insurer’s policyholder surplus as of the immediately prior year end or |
• | the statutory net gain from the insurer’s operations during the prior calendar year. |
• | annually and/or any time when there are significant changes to the risk profile of the insurer or the insurance group, conduct an ORSA to assess the adequacy of our risk management framework, including enhancements and updates to such framework, and current and estimated projected future solvency position; |
• | internally document the process and results of the assessment; and |
• | provide a confidential high-level ORSA Summary Report to our lead domiciliary state, Virginia, and make such report available, upon request, to other domiciliary state regulators within the holding company group. |
• | Corporate tax rate; |
• | International tax provisions; |
• | Policyholder reserves; |
• | Capitalization of certain policy acquisition expenses; |
• | Dividends received deduction and life insurance company share; and |
• | Net operating losses and operations loss deductions. |
• | the risk that the parties will not be able to obtain the required regulatory re-approvals, clearances or extensions, or the possibility that such regulatory re-approvals or clearances may further delay the transaction or may not be received prior to March 31, 2020 (and either or both of the parties may not be willing to further waive their end date termination rights beyond March 31, 2020) or that materially burdensome or adverse regulatory conditions may be imposed or undesirable measures may be required in connection with any such regulatory re-approvals, clearances or extensions (including those conditions or measures that either or both of the parties may be unwilling to accept or undertake, as applicable); |
• | with continuing delays, circumstances may arise that make one or both parties unwilling to proceed with the transaction or unable to comply with the conditions to existing regulatory approvals or one or both of the parties may be unwilling to accept any new condition under a regulatory re-approval; |
• | the risk that the parties will not be able to obtain other regulatory approvals, re-approvals, clearances or extensions, including in connection with a potential alternative funding structure or the current geo-political environment; |
• | one or more regulators may rescind or fail to extend existing approvals, or that the revocation by one regulator of approvals will lead to the revocation of approvals by other regulators; |
• | the parties’ inability to obtain any necessary regulatory approvals, clearances or extensions for the post-closing capital plan; |
• | the risk that a condition to closing the transaction may not be satisfied or that a condition to closing that is currently satisfied may not remain satisfied due to the delay in closing the transaction; |
• | existing and potential legal proceedings may be instituted against us in connection with the transaction that may delay the transaction, make it more costly or ultimately preclude it; |
• | the risk that the proposed transaction disrupts Genworth’s current plans and operations as a result of the announcement and consummation of the transaction; |
• | certain restrictions during the pendency of the transaction that may impact Genworth’s ability to pursue certain business opportunities or strategic transactions; |
• | continued availability of capital and financing to Genworth before, or in the absence of, the consummation of the transaction; |
• | further rating agency actions and downgrades in Genworth’s credit or financial strength ratings; |
• | changes in applicable laws or regulations; |
• | our ability to recognize the anticipated benefits of the transaction; |
• | the amount of the costs, fees, expenses and other charges related to the transaction, including costs and expenses related to conditions imposed in connection with regulatory approvals, re-approvals or clearances, which may be material; |
• | the risks related to diverting management’s attention from our ongoing business operations; |
• | our ability to attract, recruit, retain and motivate current and prospective employees may be adversely affected; and |
• | disruptions and uncertainty relating to the transaction, whether or not it is completed, may harm our relationships with our employees, customers, distributors, vendors or other business partners, and may result in a negative impact on our business. |
• | greater difficulty in executing alternative strategic plans to effectively address our current business challenges (including with respect to stabilizing our U.S. life insurance businesses, debt obligations, cost savings, ratings and capital); |
• | increased pressure on and potential further downgrades of our credit and financial strength ratings, particularly for our mortgage insurance businesses, which could have an adverse impact on our mortgage insurance businesses and could result in reduced dividends to our holding company; |
• | a negative impact on our holding company liquidity and ability to reduce, service and/or refinance our holding company debt; and |
• | we would likely pursue strategic alternatives that would materially impact our business, including a transaction with respect to our U.S. mortgage insurance business and/or our mortgage insurance business in Australia. |
• | licensing companies and agents to transact business; |
• | calculating the value of assets and determining the eligibility of assets to determine compliance with statutory requirements; |
• | mandating certain insurance benefits; |
• | regulating certain premium rates; |
• | reviewing and approving policy forms; |
• | regulating discrimination in pricing and coverage terms and unfair trade and claims practices, including through the imposition of restrictions on marketing and sales practices, distribution arrangements and payment of inducements; |
• | establishing and revising statutory capital and reserve requirements and solvency standards; |
• | fixing maximum interest rates on insurance policy loans and minimum rates for guaranteed crediting rates on life insurance policies and annuity contracts; |
• | approving premium increases and associated benefit reductions; |
• | evaluating enterprise risk to an insurer; |
• | approving changes in control of insurance companies; |
• | restricting the payment of dividends and other transactions between affiliates; |
• | regulating the types, amounts and valuation of investments; |
• | restricting the types of insurance products that may be offered; and |
• | imposing insurance eligibility criteria. |
• | ceasing and/or reducing new sales of our products or limiting the business opportunities we are presented with; |
• | adversely affecting our relationships with distributors, including the loss of exclusivity under certain agreements with our independent sales intermediaries and distribution partners; |
• | causing us to lose key distributors that have ratings requirements that we may no longer satisfy (or resulting in our renegotiation of new, less favorable arrangements with those distributors); |
• | requiring us to modify some of our existing products or services to remain competitive, or introduce new products or services; |
• | materially increasing the number or amount of policy surrenders, withdrawals and loans by contractholders and policyholders; |
• | requiring us to post additional collateral for our derivatives or hedging agreements tied to the ratings of our holding companies; |
• | requiring us to provide support, or to arrange for third-party support, in the form of collateral, capital contributions or letters of credit under the terms of certain of our reinsurance, securitization and other agreements, or otherwise securing our commercial counterparties for the perceived risk of our financial strength; |
• | adversely affecting our ability to maintain reinsurance or obtain new reinsurance or obtain it on reasonable pricing and other terms; |
• | limiting our ability to enter into new derivative transactions thereby increasing additional asset adequacy or other statutory reserves and lowering statutory capital, reducing our financial flexibility; |
• | increasing the capital charge associated with affiliated investments within certain of our U.S. life insurance businesses thereby lowering capital and RBC of these subsidiaries and negatively impacting our financial flexibility; |
• | regulators requiring certain of our subsidiaries to maintain additional capital, limiting thereby our financial flexibility and requiring us to raise additional capital; |
• | adversely affecting our ability to raise capital; |
• | increasing our cost of borrowing and making it more difficult to borrow in the public debt markets or enter into a credit agreement; and |
• | making it more difficult to execute strategic plans to effectively address our current business challenges. |
• | an increase in the level of home mortgage interest rates and, in the United States, a reduction or loss of mortgage interest deductibility for federal income tax purposes; |
• | implementation of more rigorous mortgage lending regulation, such as under APRA Prudential Practice Guides in Australia and Australia Securities and Investment Commission responsible lending guidance; |
• | a decline in economic conditions generally, or in conditions in regional and local economies; |
• | the level of consumer confidence, which may be adversely affected by economic instability, war or terrorist events; |
• | an increase in the price of homes relative to income levels; |
• | adverse population trends, including lower homeownership rates; |
• | high rates of home price appreciation, which for refinancings affect whether refinanced loans have loan-to-value ratios that require mortgage insurance; and |
• | changes in government housing policy encouraging loans to first-time home buyers. |
• | declining interest rates, which may result in the refinancing of the mortgages underlying our insurance policies with new mortgage loans that may not require mortgage insurance or that we do not insure; |
• | significant appreciation in the value of homes, which causes the size of the mortgage to decrease below 80% of the value of the home and enables the borrower to request cancellation of the mortgage insurance; and |
• | changes in mortgage insurance cancellation requirements under applicable federal law or mortgage insurance cancellation practices by mortgage lenders and investors. |
• | originating mortgages in the United States that consist of two simultaneous loans, known as “simultaneous seconds,” comprising a first mortgage with a loan-to-value ratio of 80% and a simultaneous second mortgage for the excess portion of the loan, instead of a single mortgage with a loan-to-value ratio of more than 80%; |
• | using government mortgage insurance programs; |
• | holding mortgages in the lenders’ own loan portfolios and self-insuring; |
• | using programs, such as those offered by Fannie Mae and Freddie Mac in the United States, requiring lower mortgage insurance coverage levels; |
• | originating and securitizing loans in mortgage-backed securities whose underlying mortgages are not insured with private mortgage insurance or which are structured so that the risk of default lies with the investor, rather than a private mortgage insurer; and |
• | using risk-sharing insurance programs, credit default swaps or similar instruments, instead of private mortgage insurance, to transfer credit risk on mortgages. |
Item 1B. |
Unresolved Staff Comments |
Item 2. |
Properties |
Item 3. |
Legal Proceedings |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
|||||||||||||||||||
Genworth Financial, Inc. |
$ | 100.00 |
$ | 43.88 |
$ | 44.82 |
$ | 36.59 |
$ | 54.82 |
$ | 51.76 |
||||||||||||
S&P 500 ® |
$ | 100.00 |
$ | 101.38 |
$ | 113.51 |
$ | 138.29 |
$ | 132.23 |
$ | 173.86 |
||||||||||||
S&P 500 Insurance Index |
$ | 100.00 |
$ | 102.33 |
$ | 120.32 |
$ | 139.80 |
$ | 124.13 |
$ | 160.60 |
||||||||||||
S&P MidCap 400 Index |
$ | 100.00 |
$ | 97.82 |
$ | 118.11 |
$ | 137.30 |
$ | 122.08 |
$ | 154.07 |
||||||||||||
S&P MidCap 400 Insurance Index |
$ | 100.00 |
$ | 110.75 |
$ | 139.69 |
$ | 164.46 |
$ | 161.55 |
$ | 205.32 |
Item 6. |
Selected Financial Data |
Years ended December 31, |
||||||||||||||||||||
(Amounts in millions, except per share amounts) |
2019 |
2018 |
2017 |
2016 |
2015 |
|||||||||||||||
Consolidated Statements of Income Information |
||||||||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | 4,037 |
$ | 3,994 |
$ | 3,485 |
$ | 3,679 |
$ | 4,113 |
||||||||||
Net investment income |
3,220 |
3,121 |
3,066 |
3,031 |
3,005 |
|||||||||||||||
Net investment gains (losses) |
50 |
(9 |
) | 137 |
35 |
(43 |
) | |||||||||||||
Policy fees and other income |
789 |
795 |
825 |
977 |
906 |
|||||||||||||||
Total revenues |
8,096 |
7,901 |
7,513 |
7,722 |
7,981 |
|||||||||||||||
Benefits and expenses: |
||||||||||||||||||||
Benefits and operating expenses |
7,143 |
7,508 |
7,120 |
7,510 |
7,964 |
|||||||||||||||
Interest expense |
239 |
256 |
266 |
319 |
401 |
|||||||||||||||
Total benefits and expenses |
7,382 |
7,764 |
7,386 |
7,829 |
8,365 |
|||||||||||||||
Income (loss) from continuing operations before income taxes |
714 |
137 |
127 |
(107 |
) | (384 |
) | |||||||||||||
Provision (benefit) for income taxes |
195 |
70 |
(406 |
) | 202 |
(96 |
) | |||||||||||||
Income (loss) from continuing operations |
519 |
67 |
533 |
(309 |
) | (288 |
) | |||||||||||||
Income (loss) from discontinued operations, net of taxes (1) |
11 |
230 |
394 |
242 |
(125 |
) | ||||||||||||||
Net income (loss) |
530 |
297 |
927 |
(67 |
) | (413 |
) | |||||||||||||
Less: net income (loss) from continuing operations attributable to noncontrolling interests (2) |
64 |
70 |
(80 |
) | 75 |
84 |
||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests (3) |
123 |
108 |
190 |
135 |
118 |
|||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | 343 |
$ | 119 |
$ | 817 |
$ | (277 |
) | $ | (615 |
) | ||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ | 455 |
$ | (3 |
) | $ | 613 |
$ | (384 |
) | $ | (372 |
) | |||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
(112 |
) | 122 |
204 |
107 |
(243 |
) | |||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | 343 |
$ | 119 |
$ | 817 |
$ | (277 |
) | $ | (615 |
) | ||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||||||||||
Basic |
$ | 0.90 |
$ | (0.01 |
) | $ | 1.23 |
$ | (0.77 |
) | $ | (0.75 |
) | |||||||
Diluted (4) |
$ | 0.89 |
$ | (0.01 |
) | $ | 1.22 |
$ | (0.77 |
) | $ | (0.75 |
) | |||||||
Years ended December 31, |
||||||||||||||||||||
(Amounts in millions, except per share amounts) |
2019 |
2018 |
2017 |
2016 |
2015 |
|||||||||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||||||||||
Basic (1) |
$ | (0.22 |
) | $ | 0.24 |
$ | 0.41 |
$ | 0.22 |
$ | (0.49 |
) | ||||||||
Diluted (1), (4) |
$ | (0.22 |
) | $ | 0.24 |
$ | 0.41 |
$ | 0.22 |
$ | (0.49 |
) | ||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||||||||||
Basic |
$ | 0.68 |
$ | 0.24 |
$ | 1.64 |
$ | (0.56 |
) | $ | (1.24 |
) | ||||||||
Diluted (4) |
$ | 0.67 |
$ | 0.24 |
$ | 1.63 |
$ | (0.56 |
) | $ | (1.24 |
) | ||||||||
Weighted-average common shares outstanding: (5) |
||||||||||||||||||||
Basic |
502.9 |
500.4 |
499.0 |
498.3 |
497.4 |
|||||||||||||||
Diluted (4) |
509.7 |
500.4 |
501.4 |
498.3 |
497.4 |
|||||||||||||||
Cash dividends declared per common share |
$ | — |
$ | — |
$ | — |
$ | — |
$ | — |
||||||||||
Years ended December 31, |
||||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2016 |
2015 |
|||||||||||||||
Selected Segment Information |
||||||||||||||||||||
Total revenues: |
||||||||||||||||||||
U.S. Mortgage Insurance |
$ | 978 |
$ | 841 |
$ | 772 |
$ | 726 |
$ | 665 |
||||||||||
Australia Mortgage Insurance |
390 |
427 |
(40 |
) | 440 |
474 |
||||||||||||||
U.S. Life Insurance |
6,438 |
6,318 |
6,471 |
6,250 |
6,545 |
|||||||||||||||
Runoff |
302 |
294 |
339 |
302 |
259 |
|||||||||||||||
Corporate and Other |
(12 |
) | 21 |
(29 |
) | 4 |
38 |
|||||||||||||
Total |
$ | 8,096 |
$ | 7,901 |
$ | 7,513 |
$ | 7,722 |
$ | 7,981 |
||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||||||||||
U.S. Mortgage Insurance |
$ | 569 |
$ | 490 |
$ | 311 |
$ | 249 |
$ | 179 |
||||||||||
Australia Mortgage Insurance |
59 |
70 |
(79 |
) | 65 |
103 |
||||||||||||||
U.S. Life Insurance |
13 |
(348 |
) | 112 |
(146 |
) | (253 |
) | ||||||||||||
Runoff |
39 |
13 |
61 |
25 |
(5 |
) | ||||||||||||||
Corporate and Other |
(225 |
) | (228 |
) | 208 |
(577 |
) | (396 |
) | |||||||||||
Total |
$ | 455 |
$ | (3 |
) | $ | 613 |
$ | (384 |
) | $ | (372 |
) | |||||||
Consolidated Balance Sheet Information |
||||||||||||||||||||
Total investments |
$ | 71,231 |
$ | 65,546 |
$ | 68,353 |
$ | 67,000 |
$ | 65,135 |
||||||||||
All other assets (6) |
30,111 |
30,362 |
31,456 |
32,774 |
36,708 |
|||||||||||||||
Assets held for sale (1) |
— |
5,015 |
5,488 |
4,884 |
4,588 |
|||||||||||||||
Total assets |
$ | 101,342 |
$ | 100,923 |
$ | 105,297 |
$ | 104,658 |
$ | 106,431 |
||||||||||
Policyholder liabilities |
$ | 75,452 |
$ | 73,216 |
$ | 74,441 |
$ | 73,652 |
$ | 72,540 |
||||||||||
Non-recourse funding obligations |
311 |
311 |
310 |
310 |
1,920 |
|||||||||||||||
Long-term borrowings |
3,277 |
3,707 |
3,878 |
3,858 |
4,257 |
|||||||||||||||
All other liabilities |
7,670 |
7,388 |
8,992 |
10,183 |
10,940 |
|||||||||||||||
Liabilities held for sale (1) |
— |
2,112 |
2,348 |
2,188 |
2,137 |
|||||||||||||||
Total liabilities |
$ | 86,710 |
$ | 86,734 |
$ | 89,969 |
$ | 90,191 |
$ | 91,794 |
||||||||||
Accumulated other comprehensive income (loss) |
$ | 3,433 |
$ | 2,044 |
$ | 3,027 |
$ | 3,094 |
$ | 3,010 |
||||||||||
Noncontrolling interests (2), (3) |
$ | 447 |
$ | 1,739 |
$ | 1,910 |
$ | 1,823 |
$ | 1,813 |
||||||||||
Total equity |
$ | 14,632 |
$ | 14,189 |
$ | 15,328 |
$ | 14,467 |
$ | 14,637 |
||||||||||
U.S. Statutory Financial Information (7) |
||||||||||||||||||||
Statutory capital and surplus (8) |
$ | 6,299 |
$ | 5,303 |
$ | 5,793 |
$ | 5,575 |
$ | 5,631 |
||||||||||
Asset valuation reserve |
$ | 516 |
$ | 415 |
$ | 381 |
$ | 351 |
$ | 339 |
(1) |
We sold our Canadian mortgage insurance and lifestyle protection insurance businesses on December 12, 2019 and December 1, 2015, respectively. Each of these businesses was accounted for and reported as discontinued operations and their financial position and results of operations was separately reported for all periods presented. See note 24 in our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information. On May 9, 2016, GMICO, our wholly-owned indirect subsidiary, sold our European mortgage insurance business, which was accounted for as held for sale and its financial position was separately reported for all periods presented. |
(2) |
Noncontrolling interests and net income (loss) from continuing operations attributable to noncontrolling interests relate to the third-party public ownership of our Australian mortgage insurance business. On May 21, 2014, Genworth Australia, a holding company for our Australian mortgage insurance business, completed an IPO of 220 million of its ordinary shares. Following completion of the initial offering, we |
beneficially owned 66.2% of the ordinary shares of Genworth Australia. On May 15, 2015, we sold 92.3 million of our shares in Genworth Australia at AUD$3.08 per ordinary share. Following completion of this offering, we beneficially own approximately 52.0% of the ordinary shares of Genworth Australia through subsidiaries. See note 23 in our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information related to noncontrolling interests. |
(3) |
Noncontrolling interests and net income from discontinued operations attributable to noncontrolling interests relate to the former third-party public ownership of our Canadian mortgage insurance business, which was reported as discontinued operations and sold on December 12, 2019. We completed an IPO of our former Canadian mortgage insurance business in July 2009 which reduced our ownership percentage to 57.5%. We held approximately 57.0% of the outstanding common shares of our former Canadian mortgage insurance business on a consolidated basis through subsidiaries prior to the sale. See note 24 in our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information related to discontinued operations. |
(4) |
Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of our loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the years ended December 31, 2018, 2016 and 2015, we were required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share, as the inclusion of shares for stock options, restricted stock units (“RSUs”) and stock appreciation rights (“SARs”) of 3.8 million, 2.0 million and 1.6 million, respectively, would have been antidilutive to the calculation. If we had not incurred a loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the years ended December 31, 2018, 2016 and 2015, dilutive potential weighted-average common shares outstanding would have been 504.2 million, 500.3 million and 499.0 million, respectively. |
(5) |
The calculation of diluted earnings per share is calculated using the treasury method. |
(6) |
We have several significant reinsurance transactions with UFLIC, an affiliate of GE, our former parent company, in which we ceded certain blocks of structured settlement annuities, variable annuities and long-term care insurance. As a result of these transactions, we transferred investment securities to UFLIC and recorded a reinsurance recoverable that was included in “all other assets.” For a discussion of this transaction, refer to note 8 in our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data.” |
(7) |
We derived the U.S. Statutory Financial Information from Annual Statements of our U.S. domiciled insurance company subsidiaries that were filed with the insurance departments in states where we are domiciled and were prepared in accordance with statutory accounting practices prescribed or permitted by the insurance departments in states where we are domiciled. These statutory accounting practices vary in certain material respects from U.S. GAAP. |
(8) |
Combined statutory capital and surplus for our U.S. domiciled insurance subsidiaries includes surplus notes issued by certain of our U.S. life captive insurance subsidiaries and statutorily required contingency reserves held by our U.S. mortgage insurance subsidiaries. |
Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | U.S. Mortgage Insurance . |
• | net premiums earned on U.S. mortgage insurance policies; |
• | net investment income and net investment gains (losses) on the segment’s separate investment portfolio; and |
• | fee revenues from contract underwriting services. |
• | Australia Mortgage Insurance . |
• | net premiums earned on Australia mortgage insurance policies; and |
• | net investment income and net investment gains (losses) on the segment’s separate investment portfolio. |
• | U.S. Life Insurance . |
• | net premiums earned on individual and group long-term care insurance, individual term life insurance and single premium immediate annuities with life contingencies; |
• | net investment income and net investment gains (losses) on the segment’s separate investment portfolios; and |
• | policy fees and other income, including surrender charges, mortality and expense risk charges, and other administrative charges. |
• | Runoff . |
• | net investment income and net investment gains (losses) on the segment’s separate investment portfolios; and |
• | policy fees and other income, including mortality and expense risk charges, primarily from variable annuity contracts, and other administrative charges. |
• | Corporate and Other . |
• | net premiums earned primarily on mortgage insurance policies in certain smaller international mortgage insurance businesses; |
• | unallocated net investment income and net investment gains (losses); and |
• | policy fees and other income from other businesses that are managed outside of our operating segments and eliminations of inter-segment transactions. |
• | benefits provided to policyholders and contractholders and changes in reserves; |
• | interest credited on general account balances; |
• | acquisition and operating expenses, including commissions, marketing expenses, legal expenses, policy and contract servicing costs, overhead and other general expenses that are not capitalized (shown net of deferrals); |
• | amortization of DAC and other intangible assets; |
• | interest and other financing expenses; and |
• | income taxes. |
• | We had net income available to Genworth Financial, Inc.’s common stockholders of $343 million and $119 million in 2019 and 2018, respectively. Adjusted operating income available to Genworth Financial, Inc.’s common stockholders was $420 million in 2019 compared to an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $5 million in 2018. |
• | Our U.S. Mortgage Insurance segment had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $568 million and $490 million in 2019 and 2018, respectively. The increase was mainly from higher insurance in-force and an increase in investment income, partially offset by higher operating costs and an increase in losses largely from lower net benefits from cures and aging of existing delinquencies in 2019. The years ended December 31, 2019 and 2018 included favorable reserve adjustments of $18 million and $22 million, respectively, which were mostly associated with lower expected claim rates. The year ended December 31, 2019 also included a favorable adjustment of $11 million related to our single premium earnings pattern review. |
• | Our Australia Mortgage Insurance segment had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $51 million and $76 million in 2019 and 2018, respectively. The decrease was largely driven by lower earned premiums largely from portfolio seasoning and lower policy cancellations, partially offset by lower contract fees amortization in 2019. |
• | Our U.S. Life Insurance segment had an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $55 million and $376 million in 2019 and 2018, respectively. |
|
• | Our long-term care insurance business had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $57 million in 2019 compared to an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $348 million in 2018. The increase to income in 2019 from a loss in 2018 was primarily attributable to $360 million of higher premiums and reduced benefits in 2019 from in-force rate actions approved and implemented, favorable impacts from benefit utilization rate updates and favorable development on prior year incurred but not reported claims. For more information on in-force rate actions see “—Significant Developments—U.S. Life Insurance.” These increases were partially offset by higher severity and frequency of new claims, unfavorable claim terminations driven in part by the updates from the 2018 claim reserve review and an increase in incremental reserves of $162 million recorded in connection with an accrual for profits followed by losses in 2019. Included in 2018 was higher claim reserves of $230 million due to the completion of our annual review of our claim reserves in the fourth quarter of 2018 (see “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information). Also included in 2018 was a refinement to our estimate of unreported policy terminations, which resulted in an unfavorable reserve adjustment of $28 million. |
|
• | The adjusted operating loss available to Genworth Financial, Inc.’s common stockholders in our life insurance business increased $74 million largely from higher lapses primarily associated with our large 20-year term life insurance block issued in 1999 entering its post-level premium period and the continued runoff of our life insurance products. The increase also included a more unfavorable unlocking of $16 million in our universal and term universal life insurance products |
as part of our annual review of assumptions in the fourth quarter of 2019 compared to 2018 (see “—Critical Accounting Estimates” for additional information). These increases were partially offset by lower mortality in 2019 compared to 2018. |
|
• | Adjusted operating income available to Genworth Financial, Inc.’s common stockholders decreased $10 million in our fixed annuities business mainly attributable to $14 million of higher unfavorable charges in connection with loss recognition testing in our fixed immediate annuity products (see “—Critical Accounting Estimates—Future policy benefits” for additional information), partially offset by lower interest credited due to block runoff in 2019. |
• | Our Runoff segment had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $56 million and $35 million in 2019 and 2018, respectively. The increase was predominantly from favorable equity market performance, which drove lower reserves and DAC amortization in 2019. |
• | Corporate and Other Activities had an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $200 million and $230 million in 2019 and 2018, respectively. The decrease was primarily related to lower operating costs and interest expense in 2019. |
• | We had net income available to Genworth Financial, Inc.’s common stockholders of $119 million and $817 million in 2018 and 2017, respectively. In 2018, we reported an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $5 million compared to adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $530 million in 2017. |
• | Our U.S. Mortgage Insurance segment had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $490 million and $311 million in 2018 and 2017, respectively. The increase was primarily from lower losses, which included a $22 million favorable reserve adjustment in 2018 principally from lower expected claim rates. The increase was also attributable to higher premiums due to an increase in mortgage insurance in-force, higher investment income and lower taxes in 2018. The year ended December 31, 2017 included a $10 million favorable reserve adjustment. |
• | Our Australia Mortgage Insurance segment had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $76 million in 2018 compared to an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $88 million in 2017. The increase to income in 2018 from a loss in 2017 was primarily driven by a net unfavorable adjustment of $141 million from a review of our premium earnings pattern in 2017, which also resulted in higher earned premiums on our existing insurance in-force in 2018 (see “—Critical Accounting Estimates—Unearned premiums” for additional information). The increase was partially offset by lower net investment income in 2018. |
• | Our U.S. Life Insurance segment had an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $376 million in 2018 compared to adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $22 million in 2017. The decrease from income in 2017 to a loss in 2018 was principally related to our long-term care and life insurance businesses. |
|
• | Our long-term care insurance business had an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $348 million in 2018 compared to adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $59 million in 2017. The decrease to a loss in 2018 from income in 2017 was predominantly attributable to the completion of our annual review of our claim reserves in the fourth quarter of 2018 which resulted in higher claim reserves of $230 million (see “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information). We also refined our estimate of unreported policy terminations, which resulted in an unfavorable reserve adjustment of $28 million in 2018. The |
decrease was also related to unfavorable existing claim performance from higher utilization of available benefits and lower terminations, as well as higher severity of new claims in 2018. These decreases were partially offset by higher premiums and reduced benefits in 2018 from in-force rate actions approved and implemented. For more information on in-force rate actions see “—Significant Developments—U.S. Life Insurance.” |
|
• | The adjusted operating loss in our life insurance business increased $28 million primarily from higher ceded reinsurance and unfavorable mortality in our universal and term universal life insurance products. |
|
• | Adjusted operating income in our fixed annuities business increased $37 million mainly attributable to $41 million of lower unfavorable charges in connection with loss recognition testing in our fixed immediate annuity products (see “—Critical Accounting Estimates—Future policy benefits” for additional information) and from lower interest credited in 2018. These decreases were partially offset by lower investment income in 2018. |
• | Our Runoff segment had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $35 million and $51 million in 2018 and 2017, respectively. The decrease was primarily driven by unfavorable equity market performance and higher interest credited, partially offset by lower taxes and higher investment income in 2018. |
• | Corporate and Other Activities had an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $230 million in 2018 compared to adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $234 million in 2017. The decrease to a loss in 2018 from income in 2017 was primarily driven by changes resulting from the implementation of the TCJA in December 2017 that did not recur. In the fourth quarter of 2017, we recorded a net tax benefit of $456 million primarily attributable to a $258 million release of a valuation allowance, the impact from changes in the federal tax rates and the release of shareholder liability taxes. These decreases in 2017 were partially offset by higher transition taxes, $11 million of higher taxes associated with our tax allocation methodology, which was driven by the premium earnings pattern review in our Australia mortgage insurance business and other items. The year ended December 31, 2018 included lower operating costs, partially offset by higher interest expense. |
• | PMIERs compliance. |
• | Dividends paid. |
• | Market share. Our U.S. mortgage insurance business increased its estimated market share during 2019 compared to 2018. Market share of our U.S. mortgage insurance business is influenced by the execution of its go to market strategy, including but not limited to, the market adoption of its proprietary risk-based pricing engine, GenRATE, and its selective participation in forward commitment transactions. |
• | New insurance written Our U.S. mortgage insurance business continues to grow its insurance in-force through higher new insurance written, which increased 56% in 2019 compared to 2018. This increase was primarily driven by a larger private mortgage insurance available market and an increase in estimated market share. |
• | Regulatory capital. |
• | Premium earnings pattern review. |
• | Impact from bushfires. Certain areas of Australia have been impacted by bushfires that occurred in late 2019 and continued into the first quarter of 2020. Although we do not cover property damage and continue to monitor the effect of the bushfires, it is too early to determine the impacts on the housing market or economy, if any. At this time, we do not believe there will be a significant impact to our Australia mortgage insurance business, however, we will work with our lender customers to support borrowers who have been impacted. |
• | In-force rate actions in our long-term care insurance business. |
• | Cumulative economic benefit from in-force rate actions We estimate that since 2012 the cumulative economic benefit of our rate increases equals approximately $12.5 billion, on a net present value basis, of the total amount required under our multi-year in-force rate action plan in our long-term care insurance business. For additional information on the impact in-force rate actions have on loss recognition testing of our long-term care insurance business, see “—Critical Accounting Estimates—Future policy benefits.” |
• | Completion of annual long-term care insurance claims assumption review We conduct a detailed annual review of our claim reserve assumptions for our long-term care insurance business. In 2019 and 2017, we did not make any significant changes to the assumptions or methodologies. However, in 2018, we recorded a charge of $230 million to net income based upon the completion of our annual claims assumption review. See “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information. |
• | Long-term care insurance margins In the fourth quarter of 2019, we completed our annual assumption review for our long-term care insurance business and our U.S. GAAP margins remained in the same range as our 2018 margins. For additional information on reserves, see “—Critical Accounting Estimates—Future policy benefits.” |
• | Completion of life insurance assumption review |
• | Secured term loan repayment. |
• | Redemption of Genworth Holdings’ June 2020 senior notes On January 21, 2020, Genworth Holdings early redeemed $397 million of its 7.70% senior notes originally scheduled to mature in June 2020. The senior notes were fully redeemed with a cash payment of $409 million, comprised of the outstanding principal balance of $397 million, accrued interest of approximately $3 million and a make-whole premium of approximately $9 million. |
• | Redemption of non-recourse funding obligations. |
• | Intercompany note maturity Genworth Holdings has an intercompany note due to GLIC on March 31, 2020 with a principal amount of $200 million that we expect to pay on or before maturity. |
• | Redemption of Genworth Holdings’ May 2018 senior notes On May 22, 2018, Genworth Holdings redeemed $597 million of its 6.52% senior notes that were issued in May 2008 and matured in May 2018 (the “May 2018 senior notes”). A cash payment of $616 million comprised of net proceeds of $441 million from the Term Loan and $175 million of existing cash on hand was used to fully redeem the principal and accrued interest balance of the May 2018 senior notes. |
• | Genworth Holdings’ bond consent solicitation On October 4, 2018, Genworth Holdings completed a bond consent solicitation whereby it amended its senior notes indenture to clarify that GLAIC and the subsidiaries of GLIC, GLAIC and GLICNY are excluded from the class of subsidiaries for which a bankruptcy, insolvency or other similar proceeding would result in an event of default under the indenture. In the fourth quarter of 2018, we paid $11 million of total fees, which consisted of bond consent
fees, broker, advisor and investment banking fees. The bond consent fees of $5 million were deferred and the remaining fees of $6 million were expensed in the fourth quarter of 2018. |
• | The effective tax rate decreased to 27.3% for the year ended December 31, 2019 compared to 50.8% for the year ended December 31, 2018. The decrease in the effective tax rate was primarily attributable to higher pre-tax income in 2019. The higher pre-tax income in 2019 resulted in a lower impact to the effective tax rate from gains on forward starting swaps settled prior to the enactment of the TCJA and from foreign operations. See note 13 in our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information. |
• | Completed sale of our Canada mortgage insurance business. |
• | Sale of our lifestyle protection insurance business. |
2019 |
||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
||||||||||||
Fixed maturity securities: |
||||||||||||||||
Pricing services |
$ | 54,400 |
$ | — |
$ | 54,400 |
$ | — |
||||||||
Broker quotes |
288 |
— |
— |
288 |
||||||||||||
Internal models |
5,651 |
— |
1,748 |
3,903 |
||||||||||||
Total fixed maturity securities |
$ | 60,339 |
$ | — |
$ | 56,148 |
$ | 4,191 |
||||||||
2018 |
||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
||||||||||||
Fixed maturity securities: |
||||||||||||||||
Pricing services |
$ | 50,101 |
$ | — |
$ | 50,101 |
$ | — |
||||||||
Broker quotes |
378 |
— |
— |
378 |
||||||||||||
Internal models |
5,110 |
— |
1,623 |
3,487 |
||||||||||||
Total fixed maturity securities |
$ | 55,589 |
$ | — |
$ | 51,724 |
$ | 3,865 |
||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
U.S. Life Insurance |
$ | 58 |
$ | (3 |
) | $ | 13 |
|||||
Australia Mortgage Insurance |
— |
— |
(18 |
) | ||||||||
Runoff |
(2 |
) | (2 |
) | (2 |
) | ||||||
Total |
$ | 56 |
$ | (5 |
) | $ | (7 |
) | ||||
(Amounts in millions) |
Other Block (Excluding the Acquired Block) |
|||
Sensitivities on 2019 loss recognition testing: |
||||
5% relative increase in future claim costs |
$ | (2,500 |
) | |
Discount rate decrease of 25 basis points |
$ | (1,100 |
) | |
10% reduction in benefit of future in-force rate actions |
$ | (760 |
) |
Acquired |
||||
(Amounts in millions) |
Block |
|||
Sensitivities on 2019 loss recognition testing margin: |
||||
5% relative increase in future claim costs |
$ | (100 |
) | |
Discount rate decrease of 25 basis points |
$ | (30 |
) | |
10% reduction in benefit of future in-force rate actions |
$ | — |
(Amounts in millions) |
Other Block (Excluding the Acquired Block) |
Acquired Block |
Total |
|||||||||
Sensitivities on 2019 loss recognition testing: |
||||||||||||
2% higher mortality |
$ | (70 |
) | $ | (10 |
) | $ | (80 |
) | |||
10% increase in lapses |
$ | (520 |
) | $ | (40 |
) | $ | (560 |
) |
(Amounts in millions) |
2019 |
2018 |
||||||
Long-term care insurance |
$ | 10,239 |
$ | 9,516 |
||||
Life insurance |
248 |
243 |
||||||
U.S. mortgage insurance |
233 |
296 |
||||||
Australia mortgage insurance |
208 |
196 |
||||||
Fixed annuities |
13 |
23 |
||||||
Runoff |
9 |
14 |
||||||
Other mortgage insurance |
8 |
7 |
||||||
Total liability for policy and contract claims |
$ | 10,958 |
$ | 10,295 |
||||
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
2018 vs. 2017 |
|||||||||||||||||||||||
Revenues: |
|
|||||||||||||||||||||||||||
Premiums |
$ | 4,037 |
$ | 3,994 |
$ | 3,485 |
$ | 43 |
1 |
% | $ | 509 |
15 |
% | ||||||||||||||
Net investment income |
3,220 |
3,121 |
3,066 |
99 |
3 |
% | 55 |
2 |
% | |||||||||||||||||||
Net investment gains (losses) |
50 |
(9 |
) | 137 |
59 |
NM |
(1) |
(146 |
) | (107 |
)% | |||||||||||||||||
Policy fees and other income |
789 |
795 |
825 |
(6 |
) | (1 |
)% | (30 |
) | (4 |
)% | |||||||||||||||||
Total revenues |
8,096 |
7,901 |
7,513 |
195 |
2 |
% | 388 |
5 |
% | |||||||||||||||||||
Benefits and expenses: |
|
|||||||||||||||||||||||||||
Benefits and other changes in policy reserves |
5,163 |
5,606 |
5,125 |
(443 |
) | (8 |
)% | 481 |
9 |
% | ||||||||||||||||||
Interest credited |
577 |
611 |
646 |
(34 |
) | (6 |
)% | (35 |
) | (5 |
)% | |||||||||||||||||
Acquisition and operating expenses, net of deferrals |
962 |
943 |
957 |
19 |
2 |
% | (14 |
) | (1 |
)% | ||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
441 |
348 |
392 |
93 |
27 |
% | (44 |
) | (11 |
)% | ||||||||||||||||||
Interest expense |
239 |
256 |
266 |
(17 |
) | (7 |
)% | (10 |
) | (4 |
)% | |||||||||||||||||
Total benefits and expenses |
7,382 |
7,764 |
7,386 |
(382 |
) | (5 |
)% | 378 |
5 |
% | ||||||||||||||||||
Income from continuing operations before income taxes |
714 |
137 |
127 |
577 |
NM |
(1) |
10 |
8 |
% | |||||||||||||||||||
Provision (benefit) for income taxes |
195 |
70 |
(406 |
) | 125 |
179 |
% | 476 |
117 |
% | ||||||||||||||||||
Income from continuing operations |
519 |
67 |
533 |
452 |
NM |
(1) |
(466 |
) | (87 |
)% | ||||||||||||||||||
Income from discontinued operations, net of taxes |
11 |
230 |
394 |
(219 |
) | (95 |
)% | (164 |
) | (42 |
)% | |||||||||||||||||
Net income |
530 |
297 |
927 |
233 |
78 |
% | (630 |
) | (68 |
)% | ||||||||||||||||||
Less: net income (loss) from continuing operations attributable to noncontrolling interests |
64 |
70 |
(80 |
) | (6 |
) | (9 |
)% | 150 |
188 |
% | |||||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
123 |
108 |
190 |
15 |
14 |
% | (82 |
) | (43 |
)% | ||||||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | 343 |
$ | 119 |
$ | 817 |
$ | 224 |
188 |
% | $ | (698 |
) | (85 |
)% | |||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: |
|
|||||||||||||||||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ | 455 |
$ | (3 |
) | $ | 613 |
$ | 458 |
NM |
(1) |
$ | (616 |
) | (100 |
)% | ||||||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
(112 |
) | 122 |
204 |
(234 |
) | (192 |
)% | (82 |
) | (40 |
)% | ||||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | 343 |
$ | 119 |
$ | 817 |
$ | 224 |
188 |
% | $ | (698 |
) | (85 |
)% | |||||||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
• | Our U.S. Mortgage Insurance segment increased $110 million mainly attributable to higher insurance in-force and from higher policy cancellations in our single premium mortgage insurance product driven largely by mortgage refinancing, partially offset by lower average premium rates in 2019. The year ended December 31, 2019 also included a favorable adjustment of $14 million related to our single premium earnings pattern review. |
• | Our Australia Mortgage Insurance segment decreased $61 million predominantly from portfolio seasoning and lower policy cancellations in 2019. The year ended December 31, 2019 included a decrease of $24 million attributable to changes in foreign exchange rates. |
• | Our U.S. Life Insurance segment decreased $6 million. Our long-term care insurance business increased $22 million largely from $107 million of increased premiums in 2019 from in-force rate actions approved and implemented, partially offset by policy terminations and policies entering paid-up status in 2019. Our life insurance business decreased $28 million mainly attributable to the continued runoff of our term life insurance products in 2019. |
• | Our Runoff segment decreased $13 million principally from lower fee income driven mostly by a decline in the average account values in our variable annuity products in 2019. |
• | Corporate and Other activities increased $5 million primarily related to gains from non-functional currency remeasurement transactions in 2019 compared to losses in 2018. |
• | Our U.S. Life Insurance segment decreased $437 million. Our long-term care insurance business decreased $393 million principally related to a higher favorable impact of $357 million from reduced benefits in 2019 related to in-force rate actions approved and implemented. The decrease was also attributable to favorable impacts from benefit utilization rate updates and favorable development on prior year incurred but not reported claims. These decreases were partially offset by the aging of the in-force block (including higher frequency and severity of new claims), unfavorable claim terminations driven in part by the updates from the 2018 claim reserve review and an increase in incremental reserves of $205 million recorded in connection with an accrual for profits followed by losses in 2019. Included in 2018 was higher claim reserves of $291 million, net of reinsurance, related to the |
completion of our annual review of our claim reserves in the fourth quarter of 2018 (see “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information). Also included in 2018 was a refinement to our estimate of unreported policy terminations, which resulted in an unfavorable reserve adjustment of $36 million. Our life insurance business decreased $29 million primarily attributable to a less unfavorable unlocking of $30 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2019 compared to 2018 (see “—Critical Accounting Estimates—Policyholder account balances” for additional information). The decrease was also attributable to lower mortality in 2019 compared to 2018. Our fixed annuities business decreased $15 million largely attributable to lower interest credited due to block runoff, lower reserves in our fixed indexed annuity products driven mostly by favorable market performance and higher mortality. These decreases were partially offset by $17 million of higher reserves recorded in connection with loss recognition testing in our fixed immediate annuity products primarily as a result of a decline in interest rates (see “—Critical Accounting Estimates—Future policy benefits” for additional information). |
• | Our Runoff segment decreased $12 million primarily attributable to lower GMDB reserves in our variable annuity products due to favorable equity market performance in 2019. |
• | Our Australia Mortgage Insurance segment decreased $6 million from changes attributable to foreign exchange rates in 2019. Excluding the effects of changes in foreign exchange rates, benefits and other changes in policy reserves increased primarily from higher reserves on new delinquencies, partially offset by favorable cure activity in 2019. |
• | Our U.S. Mortgage Insurance segment increased $14 million primarily from lower net benefits from cures and aging of existing delinquencies and from less favorable reserve adjustments in 2019. We recorded $23 million of favorable reserve adjustments in 2019 compared to a $28 million favorable reserve adjustment in 2018. These adjustments were mostly associated with lower expected claim rates. These increases were partially offset by a lower average reserve on new delinquencies in 2019. |
• | Our U.S. Life Insurance segment decreased $42 million. The decrease in interest credited was due to our life insurance and fixed annuities businesses, which decreased $7 million and $35 million, respectively, primarily driven by a decline in average account values and lower crediting rates in 2019. |
• | Our Runoff segment increased $8 million largely related to higher account values in our corporate-owned life insurance products in 2019. |
• | Our U.S. Mortgage Insurance segment increased $22 million largely from higher operating costs driven mostly by increased sales in 2019. |
• | Our U.S. Life Insurance segment increased $20 million. Our long-term care insurance business increased $7 million primarily related to higher general expenses and legal costs in 2019. Our life insurance business increased $14 million largely attributable to a net decrease in deferrals in 2019 reflecting recent lapse experience, partially offset by lower operating expenses in 2019 as a result of the continued runoff of our in-force block. |
• | Our Australia Mortgage Insurance segment increased $4 million primarily related to higher operating expenses in 2019. The year ended December 31, 2019 included a decrease of $4 million attributable to changes in foreign exchange rates. |
• | Corporate and Other activities decreased $22 million mainly driven by lower employee-related expenses and operating costs in 2019. |
• | Our Runoff segment decreased $5 million mainly from lower commissions in our variable annuity products in 2019. |
• | Our U.S. Life Insurance segment increased $115 million driven mostly by our life insurance business associated with higher lapses primarily from our large 20-year term life insurance block issued in 1999 entering its post-level premium period. The increase was also attributable to an unfavorable unlocking of $63 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2019 compared to a favorable unlocking of $4 million in 2018 (see “—Critical Accounting Estimates—Deferred acquisition costs” for additional information). |
• | Our Runoff segment decreased $15 million mainly related to lower DAC amortization in our variable annuity products principally from favorable equity market performance in 2019. |
• | Our Australia Mortgage Insurance segment decreased $10 million largely from lower contract fees amortization in 2019. |
• | Our Australia Mortgage Insurance segment increased $513 million predominantly from a review of our premium earnings pattern in 2017, which reduced our earned premiums by $468 million in 2017 and increased our earned premiums on our existing insurance in-force in 2018 (see “—Critical Accounting Estimates—Unearned premiums” for additional information). The increase was also attributable to a new structured insurance transaction and higher policy cancellations resulting from an initiative implemented in 2018 to more promptly identify loans that have been discharged or refinanced using newly available data. |
• | Our U.S. Mortgage Insurance segment increased $51 million mainly attributable to higher average flow insurance in-force, partially offset by lower average rates on our mortgage insurance in-force in 2018. |
• | Our U.S. Life Insurance segment decreased $55 million. Our long-term care insurance business increased $68 million largely from $70 million of increased premiums in 2018 from in-force rate actions approved and implemented and from a $60 million unfavorable correction in 2017 related to |
certain limited pay policies that had reached their paid up status that did not recur. These increases were partially offset by policy terminations in 2018. Our life insurance business decreased $123 million mainly attributable to higher ceded premiums in 2018 from new reinsurance treaties effective in December 2017 and the continued runoff of our term life insurance products in 2018. |
• | Our U.S. Life Insurance segment decreased $19 million mostly attributable to our life insurance business primarily as a result of a decline in our term universal and universal life insurance in-force blocks in 2018. The decrease was also related to an unfavorable unlocking of $7 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2018 compared to a favorable unlocking of $3 million in 2017. These decreases were partially offset by an $8 million unfavorable model refinement in 2017 that did not recur. |
• | Our Runoff segment decreased $10 million principally from lower fee income driven mostly by a decline in the average account values in our variable annuity products in 2018. |
• | Our U.S. Life Insurance segment increased $536 million. Our long-term care insurance business increased $652 million principally from the completion of our annual review of our claim reserves in the fourth quarter of 2018 which resulted in higher claim reserves of $291 million, net of reinsurance (see “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information). We also refined our estimate of unreported policy terminations, which resulted in an unfavorable reserve adjustment of $36 million in 2018. The increase was also attributable to higher reserves as a result of the aging of the in-force block (including higher frequency of new claims), unfavorable existing claim performance from higher utilization of available benefits and lower terminations, as well as higher severity of new claims in 2018. Our life insurance business decreased $35 million primarily attributable to higher ceded benefits in 2018 from new reinsurance treaties effective in December 2017, a $30 million unfavorable model refinement in 2017 that did not recur and lower mortality in our term life insurance products in 2018. These decreases were partially offset by a higher unfavorable unlocking of $39 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2018 compared to 2017 (see “—Critical Accounting Estimates—Policyholder account balances” for additional information) and unfavorable mortality in our universal and term universal life insurance products in 2018. Our fixed annuities business decreased $81 million largely attributable to $67 million of lower reserves in connection with loss recognition testing in our fixed immediate annuity products (see “—Critical Accounting Estimates—Future policy benefits” for additional information). |
• | Our Runoff segment increased $13 million primarily attributable to higher GMDB reserves in our variable annuity products due to unfavorable equity market performance in 2018. |
• | Our U.S. Mortgage Insurance segment decreased $71 million primarily from lower new delinquencies, favorable net cures and aging of existing delinquencies and a $28 million favorable reserve adjustment in 2018 mostly driven by lower expected claim rates. The year ended December 31, 2017 included a $15 million favorable reserve adjustment and approximately $5 million of losses attributable to new delinquencies in areas impacted by hurricanes Harvey and Irma. |
• | Our U.S. Life Insurance segment decreased $45 million primarily due to our fixed annuities business predominantly from a decline in average account values and lower crediting rates in 2018. |
• | Our Runoff segment increased $10 million largely related to higher account values in our corporate-owned life insurance products in 2018. |
• | Corporate and Other activities decreased $25 million mainly driven by lower compensation expenses and consulting fees, as well as lower net expenses after allocations in 2018. These decreases were partially offset by $6 million of broker, advisor and investment banking fees associated with Genworth Holdings’ bond consent solicitation in October 2018. |
• | Our Runoff segment decreased $4 million mainly from lower commissions in our variable annuity products in 2018. |
• | Our U.S. Life Insurance segment increased $12 million mostly attributable to our long-term care insurance business largely from higher operating costs associated with our in-force rate action plan, partially offset by guaranty fund assessments in 2017 in connection with the Penn Treaty liquidation that did not recur. |
• | Our U.S. Mortgage Insurance segment increased $4 million largely from higher compensation and benefit expenses in 2018. |
• | Our U.S. Life Insurance segment decreased $71 million mostly attributable to our life insurance business largely from a $41 million unfavorable term conversion mortality assumption correction in 2017 that did not recur. The decrease was also attributable to a favorable unlocking of $4 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2018 compared to an unfavorable unlocking of $44 million in 2017 (see “—Critical Accounting Estimates—Deferred acquisition costs” for additional information) and from lower lapses in 2018. These decreases were partially offset by prior year transactions that did not recur: a net $15 million favorable model refinement and an $11 million refinement related to reinsurance rates. |
• | Our Australia Mortgage Insurance segment increased $19 million primarily as a result of an $18 million decrease in amortization of DAC in 2017 related to our premium earnings pattern review that did not recur and higher contract fees amortization in 2018. |
• | Our Runoff segment increased $9 million related to our variable annuity products mainly from unfavorable equity market performance, partially offset by higher net investment losses on embedded derivatives in 2018. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | 343 |
$ | 119 |
$ | 817 |
||||||
Add: net income (loss) from continuing operations attributable to noncontrolling interests |
64 |
70 |
(80 |
) | ||||||||
Add: net income from discontinued operations attributable to noncontrolling interests |
123 |
108 |
190 |
|||||||||
Net income |
530 |
297 |
927 |
|||||||||
Less: Income from discontinued operations, net of taxes |
11 |
230 |
394 |
|||||||||
Income from continuing operations |
519 |
67 |
533 |
|||||||||
Less: net income (loss) from continuing operations attributable to noncontrolling interests |
64 |
70 |
(80 |
) | ||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
455 |
(3 |
) | 613 |
||||||||
Adjustments to income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||
Net investment (gains) losses, net (1) |
(50 |
) | (10 |
) | (128 |
) | ||||||
Expenses related to restructuring |
4 |
2 |
1 |
|||||||||
Fees associated with bond consent solicitation |
— |
6 |
— |
|||||||||
Taxes on adjustments |
11 |
— |
44 |
|||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | 420 |
$ | (5 |
) | $ | 530 |
|||||
(1) |
For the years ended December 31, 2019, 2018 and 2017, net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves of $(11) million, $(12) million and $(3) million, respectively, and adjusted for the portion of net investment gains (losses) attributable to noncontrolling interests of $11 million, $(7) million and $12 million, respectively. |
(Amounts in millions, except per share amounts) |
2019 |
2018 |
2017 |
|||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||
Basic |
$ | 0.90 |
$ | (0.01 |
) | $ | 1.23 |
|||||
Diluted |
$ | 0.89 |
$ | (0.01 |
) | $ | 1.22 |
|||||
Net income available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||
Basic |
$ | 0.68 |
$ | 0.24 |
$ | 1.64 |
||||||
Diluted |
$ | 0.67 |
$ | 0.24 |
$ | 1.63 |
||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||
Basic |
$ | 0.84 |
$ | (0.01 |
) | $ | 1.06 |
|||||
Diluted |
$ | 0.82 |
$ | (0.01 |
) | $ | 1.06 |
|||||
Weighted-average common shares outstanding: |
||||||||||||
Basic |
502.9 |
500.4 |
499.0 |
|||||||||
Diluted (1) |
509.7 |
500.4 |
501.4 |
|||||||||
(1) |
Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of our loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the year ended December 31, 2018, we were required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share as the inclusion of shares for stock options, RSUs and SARs of 3.8 million would have been antidilutive to the calculation. If we had not incurred a loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the year ended December 31, 2018, dilutive potential weighted-average common shares outstanding would have been 504.2 million. |
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | 856 |
$ | 746 |
$ | 695 |
$ | 110 |
15 |
% | ||||||||||
Net investment income |
117 |
93 |
73 |
24 |
26 |
% | ||||||||||||||
Net investment gains (losses) |
1 |
— |
— |
1 |
NM |
(1) | ||||||||||||||
Policy fees and other income |
4 |
2 |
4 |
2 |
100 |
% | ||||||||||||||
Total revenues |
978 |
841 |
772 |
137 |
16 |
% | ||||||||||||||
Benefits and expenses: |
||||||||||||||||||||
Benefits and other changes in policy reserves |
50 |
36 |
107 |
14 |
39 |
% | ||||||||||||||
Acquisition and operating expenses, net of deferrals |
191 |
169 |
165 |
22 |
13 |
% | ||||||||||||||
Amortization of deferred acquisition costs and intangibles |
15 |
14 |
14 |
1 |
7 |
% | ||||||||||||||
Total benefits and expenses |
256 |
219 |
286 |
37 |
17 |
% | ||||||||||||||
Income from continuing operations before income taxes |
722 |
622 |
486 |
100 |
16 |
% | ||||||||||||||
Provision for income taxes |
153 |
132 |
175 |
21 |
16 |
% | ||||||||||||||
Income from continuing operations |
569 |
490 |
311 |
79 |
16 |
% | ||||||||||||||
Adjustments to income from continuing operations: |
||||||||||||||||||||
Net investment (gains) losses |
(1 |
) | — |
— |
(1 |
) | NM |
(1) | ||||||||||||
Taxes on adjustments |
— |
— |
— |
— |
— |
% | ||||||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders |
$ | 568 |
$ | 490 |
$ | 311 |
$ | 78 |
16 |
% | ||||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
As of or for the years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Primary insurance in-force (1) |
$ | 192,100 |
$ | 166,700 |
$ | 151,800 |
$ | 25,400 |
15 |
% | ||||||||||
Risk in-force |
$ | 46,400 |
$ | 40,400 |
$ | 36,800 |
$ | 6,000 |
15 |
% | ||||||||||
New insurance written |
$ | 62,400 |
$ | 40,000 |
$ | 38,900 |
$ | 22,400 |
56 |
% | ||||||||||
Net premiums written |
$ | 818 |
$ | 764 |
$ | 757 |
$ | 54 |
7 |
% |
(1) |
Primary insurance in-force represents the aggregate original loan balance for outstanding insurance policies and is used to determine premiums. Original loan balances are presented for policies with level renewal premiums. Amortized loan balances are presented for policies with annual, amortizing renewal premiums. |
Years ended December 31, |
Increase (decrease) |
|||||||||||||||
2019 |
2018 |
2017 |
2019 vs. 2018 |
|||||||||||||
Loss ratio |
6 |
% | 5 |
% | 15 |
% | 1 |
% | ||||||||
Expense ratio (net earned premiums) |
24 |
% | 25 |
% | 26 |
% | (1 |
)% | ||||||||
Expense ratio (net premiums written) |
25 |
% | 24 |
% | 24 |
% | 1 |
% |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Primary risk in-force lender concentration (by original applicant) |
$ | 46,378 |
$ | 40,293 |
$ | 36,710 |
||||||
Top 10 lenders |
$ | 14,013 |
$ | 11,233 |
$ | 10,686 |
||||||
Top 20 lenders |
$ | 18,264 |
$ | 15,099 |
$ | 14,288 |
||||||
Loan-to-value ratio: |
||||||||||||
95.01% and above |
$ | 8,364 |
$ | 7,124 |
$ | 6,057 |
||||||
90.01% to 95.00% |
23,958 |
20,946 |
19,043 |
|||||||||
80.01% to 90.00% |
13,912 |
12,054 |
11,410 |
|||||||||
80.00% and below |
144 |
169 |
200 |
|||||||||
Total |
$ | 46,378 |
$ | 40,293 |
$ | 36,710 |
||||||
Loan grade: |
||||||||||||
Prime |
$ | 45,929 |
$ | 39,757 |
$ | 36,049 |
||||||
A minus and sub-prime |
449 |
536 |
661 |
|||||||||
Total |
$ | 46,378 |
$ | 40,293 |
$ | 36,710 |
||||||
|
2019 |
2018 |
2017 |
|||||||||
Primary insurance: |
||||||||||||
Insured loans in-force |
860,214 |
783,288 |
742,094 |
|||||||||
Delinquent loans |
16,607 |
17,159 |
23,188 |
|||||||||
Percentage of delinquent loans (delinquency rate) |
1.93 |
% | 2.19 |
% | 3.12 |
% | ||||||
Flow loans in-force |
849,472 |
770,657 |
725,748 |
|||||||||
Flow delinquent loans |
16,209 |
16,670 |
22,483 |
|||||||||
Percentage of flow delinquent loans (delinquency rate) |
1.91 |
% | 2.16 |
% | 3.10 |
% | ||||||
Bulk loans in-force |
10,742 |
12,631 |
16,346 |
|||||||||
Bulk delinquent loans (1) |
398 |
489 |
705 |
|||||||||
Percentage of bulk delinquent loans (delinquency rate) |
3.71 |
% | 3.87 |
% | 4.31 |
% | ||||||
A minus and sub-prime loans in-force |
12,792 |
15,348 |
18,912 |
|||||||||
A minus and sub-prime delinquent loans |
2,283 |
2,727 |
4,054 |
|||||||||
Percentage of A minus and sub-prime delinquent loans (delinquency rate) |
17.85 |
% | 17.77 |
% | 21.44 |
% | ||||||
Pool insurance: |
||||||||||||
Insured loans in-force |
4,122 |
4,535 |
5,039 |
|||||||||
Delinquent loans |
167 |
220 |
249 |
|||||||||
Percentage of delinquent loans (delinquency rate) |
4.05 |
% | 4.85 |
% | 4.94 |
% |
(1) |
Included loans where we were in a secondary loss position for which no reserve was established due to an existing deductible. Excluding these loans, bulk delinquent loans were 348, 403 and 614 as of December 31, 2019, 2018 and 2017, respectively. |
2019 |
||||||||||||||||
(Dollar amounts in millions) |
Delinquencies |
Direct case reserves (1) |
Risk in-force |
Reserves as % of risk in-force |
||||||||||||
Payments in default: |
|
|||||||||||||||
3 payments or less |
8,524 |
$ | 27 |
$ | 386 |
7 |
% | |||||||||
4 - 11 payments |
4,836 |
78 |
224 |
35 |
% | |||||||||||
12 payments or more |
2,849 |
99 |
145 |
68 |
% | |||||||||||
Total |
16,209 |
$ | 204 |
$ | 755 |
27 |
% | |||||||||
2018 |
||||||||||||||||
(Dollar amounts in millions) |
Delinquencies |
Direct case reserves (1) |
Risk in-force |
Reserves as % of risk in-force |
||||||||||||
Payments in default: |
|
|||||||||||||||
3 payments or less |
8,360 |
$ | 31 |
$ | 365 |
8 |
% | |||||||||
4 - 11 payments |
4,591 |
88 |
208 |
42 |
% | |||||||||||
12 payments or more |
3,719 |
142 |
188 |
76 |
% | |||||||||||
Total |
16,670 |
$ | 261 |
$ | 761 |
34 |
% | |||||||||
(1) |
Direct flow case reserves exclude loss adjustment expenses, incurred but not reported and reinsurance reserves. |
Percent of primary risk in-force as of |
Percent of total reserves as of |
Delinquency rate as of December 31, |
||||||||||||||||||
2018 |
2017 |
|||||||||||||||||||
By Region: |
|
|
|
|
||||||||||||||||
Southeast (2) |
18 |
% | 21 |
% | 2.15 |
% | 2.63 |
% | 4.60 |
% | ||||||||||
Pacific (3) |
17 |
11 |
1.36 |
% | 1.29 |
% | 1.56 |
% | ||||||||||||
South Central (4) |
16 |
12 |
1.84 |
% | 2.11 |
% | 3.30 |
% | ||||||||||||
Northeast (5) |
12 |
26 |
2.72 |
% | 3.43 |
% | 4.67 |
% | ||||||||||||
North Central (6) |
11 |
10 |
1.91 |
% | 1.98 |
% | 2.34 |
% | ||||||||||||
Great Lakes (7) |
11 |
7 |
1.69 |
% | 1.72 |
% | 2.09 |
% | ||||||||||||
Mid-Atlantic (8) |
6 |
5 |
1.90 |
% | 2.16 |
% | 2.79 |
% | ||||||||||||
New England (9) |
5 |
6 |
1.92 |
% | 2.23 |
% | 2.75 |
% | ||||||||||||
Plains (10) |
4 |
2 |
1.69 |
% | 1.87 |
% | 2.36 |
% | ||||||||||||
Total |
100 |
% | 100 |
% | 1.93 |
% | 2.19 |
% | 3.12 |
% | ||||||||||
(1) |
Total reserves were $233 million as of December 31, 2019. |
(2) |
Alabama, Arkansas, Florida, Georgia, Mississippi, North Carolina, South Carolina and Tennessee. |
(3) |
Alaska, California, Hawaii, Nevada, Oregon and Washington. |
(4) |
Arizona, Colorado, Louisiana, New Mexico, Oklahoma, Texas and Utah. |
(5) |
New Jersey, New York and Pennsylvania. |
(6) |
Illinois, Minnesota, Missouri and Wisconsin. |
(7) |
Indiana, Kentucky, Michigan and Ohio. |
(8) |
Delaware, Maryland, Virginia, Washington D.C. and West Virginia. |
(9) |
Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. |
(10) |
Idaho, Iowa, Kansas, Montana, Nebraska, North Dakota, South Dakota and Wyoming. |
Percent of primary risk in-force as of |
Percent of total reserves as of |
Delinquency rate as of December 31, |
||||||||||||||||||
2018 |
2017 |
|||||||||||||||||||
By State: |
|
|
|
|||||||||||||||||
California |
10 |
% | 6 |
% | 1.42 |
% | 1.28 |
% | 1.45 |
% | ||||||||||
Texas |
7 |
% | 5 |
% | 2.02 |
% | 2.29 |
% | 4.41 |
% | ||||||||||
Florida |
6 |
% | 11 |
% | 2.13 |
% | 2.91 |
% | 7.99 |
% | ||||||||||
New York |
5 |
% | 15 |
% | 3.00 |
% | 3.64 |
% | 4.77 |
% | ||||||||||
Illinois |
5 |
% | 6 |
% | 2.27 |
% | 2.26 |
% | 2.70 |
% | ||||||||||
Washington |
4 |
% | 2 |
% | 1.10 |
% | 1.04 |
% | 1.19 |
% | ||||||||||
Michigan |
4 |
% | 2 |
% | 1.44 |
% | 1.40 |
% | 1.51 |
% | ||||||||||
Pennsylvania |
4 |
% | 4 |
% | 2.15 |
% | 2.79 |
% | 3.50 |
% | ||||||||||
North Carolina |
4 |
% | 2 |
% | 1.79 |
% | 2.27 |
% | 2.67 |
% | ||||||||||
Ohio |
3 |
% | 3 |
% | 1.84 |
% | 1.97 |
% | 2.43 |
% |
(1) |
Total reserves were $233 million as of December 31, 2019. |
(Amounts in millions) |
Average rate (1) |
Percent of total reserves (2) |
Primary insurance in-force |
Percent of total |
Primary risk in-force |
Percent of total |
||||||||||||||||||
Policy Year |
|
|||||||||||||||||||||||
2004 and prior |
6.13 |
% | 7.4 |
% | $ | 1,358 |
0.7 |
% | $ | 254 |
0.5 |
% | ||||||||||||
2005 to 2008 |
5.47 |
% | 51.4 |
15,649 |
8.2 |
3,574 |
7.7 |
|||||||||||||||||
2009 to 2012 |
4.29 |
% | 2.2 |
3,156 |
1.6 |
720 |
1.6 |
|||||||||||||||||
2013 |
4.14 |
% | 1.9 |
3,808 |
2.0 |
927 |
2.0 |
|||||||||||||||||
2014 |
4.45 |
% | 4.0 |
7,000 |
3.6 |
1,693 |
3.6 |
|||||||||||||||||
2015 |
4.15 |
% | 6.1 |
14,397 |
7.5 |
3,471 |
7.5 |
|||||||||||||||||
2016 |
3.89 |
% | 8.3 |
26,695 |
13.9 |
6,426 |
13.9 |
|||||||||||||||||
2017 |
4.25 |
% | 9.6 |
29,243 |
15.2 |
7,091 |
15.3 |
|||||||||||||||||
2018 |
4.76 |
% | 7.3 |
31,454 |
16.4 |
7,655 |
16.5 |
|||||||||||||||||
2019 |
4.27 |
% | 1.8 |
59,370 |
30.9 |
14,567 |
31.4 |
|||||||||||||||||
Total portfolio |
4.44 |
% | 100.0 |
% | $ | 192,130 |
100.0 |
% | $ | 46,378 |
100.0 |
% | ||||||||||||
(1) |
Average rate represents average annual mortgage interest rate. |
(2) |
Total reserves were $233 million as of December 31, 2019. |
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Revenues: |
|
|||||||||||||||||||
Premiums |
$ | 312 |
$ | 373 |
$ | (140 |
) | $ | (61 |
) | (16 |
)% | ||||||||
Net investment income |
55 |
67 |
75 |
(12 |
) | (18 |
)% | |||||||||||||
Net investment gains (losses) |
23 |
(15 |
) | 25 |
38 |
NM |
(1) | |||||||||||||
Policy fees and other income |
— |
2 |
— |
(2 |
) | (100 |
)% | |||||||||||||
Total revenues |
390 |
427 |
(40 |
) | (37 |
) | (9 |
)% | ||||||||||||
Benefits and expenses: |
|
|||||||||||||||||||
Benefits and other changes in policy reserves |
104 |
110 |
109 |
(6 |
) | (5 |
)% | |||||||||||||
Acquisition and operating expenses, net of deferrals |
69 |
65 |
67 |
4 |
6 |
% | ||||||||||||||
Amortization of deferred acquisition costs and intangibles |
33 |
43 |
24 |
(10 |
) | (23 |
)% | |||||||||||||
Interest expense |
8 |
9 |
9 |
(1 |
) | (11 |
)% | |||||||||||||
Total benefits and expenses |
214 |
227 |
209 |
(13 |
) | (6 |
)% | |||||||||||||
Income (loss) from continuing operations before income taxes |
176 |
200 |
(249 |
) | (24 |
) | (12 |
)% | ||||||||||||
Provision (benefit) for income taxes |
53 |
60 |
(90 |
) | (7 |
) | (12 |
)% | ||||||||||||
Income (loss) from continuing operations |
123 |
140 |
(159 |
) | (17 |
) | (12 |
)% | ||||||||||||
Less: net income (loss) from continuing operations attributable to noncontrolling interests |
64 |
70 |
(80 |
) | (6 |
) | (9 |
)% | ||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
59 |
70 |
(79 |
) | (11 |
) | (16 |
)% | ||||||||||||
Adjustments to income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders: |
|
|||||||||||||||||||
Net investment (gains) losses, net (2) |
(12 |
) | 8 |
(13 |
) | (20 |
) | NM |
(1) | |||||||||||
Taxes on adjustments |
4 |
(2 |
) | 4 |
6 |
NM |
(1) | |||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | 51 |
$ | 76 |
$ | (88 |
) | $ | (25 |
) | (33 |
)% | ||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) |
For the years ended December 31, 2019, 2018 and 2017, net investment (gains) losses were adjusted for the portion of net investment gains (losses) attributable to noncontrolling interests of $11 million, $(7) million and $12 million, respectively. |
As of or for the years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Primary insurance in-force |
$ | 215,700 |
$ | 218,200 |
$ | 251,400 |
$ | (2,500 |
) | (1 |
)% | |||||||||
Risk in-force |
$ | 75,100 |
$ | 76,000 |
$ | 87,500 |
$ | (900 |
) | (1 |
)% | |||||||||
New insurance written |
$ | 18,700 |
$ | 16,600 |
$ | 18,300 |
$ | 2,100 |
13 |
% | ||||||||||
Net premiums written |
$ | 272 |
$ | 242 |
$ | 231 |
$ | 30 |
12 |
% |
Years ended December 31, |
Increase (decrease) |
|||||||||||||||
2019 |
2018 |
2017 |
2019 vs. 2018 |
|||||||||||||
Loss ratio |
33 |
% | 30 |
% | (79 |
)% | 3 |
% | ||||||||
Expense ratio (net earned premiums) |
33 |
% | 29 |
% | (65 |
)% | 4 |
% | ||||||||
Expense ratio (net premiums written) |
38 |
% | 45 |
% | 39 |
% | (7 |
)% |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
95.01% and above |
$ | 10,153 |
$ | 11,261 |
$ | 13,849 |
||||||
90.01% to 95.00% |
21,284 |
21,081 |
23,849 |
|||||||||
80.01% to 90.00% |
23,556 |
22,475 |
24,524 |
|||||||||
80.00% and below |
20,156 |
21,161 |
25,258 |
|||||||||
Total |
$ | 75,149 |
$ | 75,978 |
$ | 87,480 |
||||||
2019 |
2018 |
2017 |
||||||||||
Primary insured loans in-force |
1,290,216 |
1,332,906 |
1,416,525 |
|||||||||
Delinquent loans |
7,221 |
7,145 |
6,696 |
|||||||||
Percentage of delinquent loans (delinquency rate) |
0.56 |
% | 0.54 |
% | 0.47 |
% | ||||||
Flow loans in-force |
1,189,019 |
1,226,219 |
1,303,928 |
|||||||||
Flow delinquent loans |
7,003 |
6,931 |
6,476 |
|||||||||
Percentage of flow delinquent loans (delinquency rate) |
0.59 |
% | 0.57 |
% | 0.50 |
% | ||||||
Bulk loans in-force |
101,197 |
106,687 |
112,597 |
|||||||||
Bulk delinquent loans |
218 |
214 |
220 |
|||||||||
Percentage of bulk delinquent loans (delinquency rate) |
0.22 |
% | 0.20 |
% | 0.20 |
% |
Percent of primary risk in-force as of |
Delinquency rate as of December 31, |
|||||||||||||||
2018 |
2017 |
|||||||||||||||
By state and territory: |
||||||||||||||||
New South Wales |
27 |
% | 0.42 |
% | 0.38 |
% | 0.31 |
% | ||||||||
Queensland |
23 |
0.75 |
% | 0.70 |
% | 0.67 |
% | |||||||||
Victoria |
23 |
0.41 |
% | 0.40 |
% | 0.37 |
% | |||||||||
Western Australia |
13 |
1.00 |
% | 0.98 |
% | 0.83 |
% | |||||||||
South Australia |
6 |
0.65 |
% | 0.68 |
% | 0.60 |
% | |||||||||
Australian Capital Territory |
3 |
0.24 |
% | 0.17 |
% | 0.14 |
% | |||||||||
Tasmania |
2 |
0.29 |
% | 0.31 |
% | 0.32 |
% | |||||||||
New Zealand |
2 |
0.02 |
% | 0.05 |
% | 0.04 |
% | |||||||||
Northern Territory |
1 |
0.71 |
% | 0.68 |
% | 0.48 |
% | |||||||||
Total |
100 |
% | 0.56 |
% | 0.54 |
% | 0.47 |
% | ||||||||
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | 2,861 |
$ | 2,867 |
$ | 2,922 |
$ | (6 |
) | — |
% | |||||||||
Net investment income |
2,852 |
2,781 |
2,755 |
71 |
3 |
% | ||||||||||||||
Net investment gains (losses) |
82 |
29 |
134 |
53 |
183 |
% | ||||||||||||||
Policy fees and other income |
643 |
641 |
660 |
2 |
— |
% | ||||||||||||||
Total revenues |
6,438 |
6,318 |
6,471 |
120 |
2 |
% | ||||||||||||||
Benefits and expenses: |
|
|||||||||||||||||||
Benefits and other changes in policy reserves |
4,979 |
5,416 |
4,880 |
(437 |
) | (8 |
)% | |||||||||||||
Interest credited |
419 |
461 |
506 |
(42 |
) | (9 |
)% | |||||||||||||
Acquisition and operating expenses, net of deferrals |
604 |
584 |
572 |
20 |
3 |
% | ||||||||||||||
Amortization of deferred acquisition costs and intangibles |
372 |
257 |
328 |
115 |
45 |
% | ||||||||||||||
Interest expense |
17 |
16 |
13 |
1 |
6 |
% | ||||||||||||||
Total benefits and expenses |
6,391 |
6,734 |
6,299 |
(343 |
) | (5 |
)% | |||||||||||||
Income (loss) from continuing operations before income taxes |
47 |
(416 |
) | 172 |
463 |
111 |
% | |||||||||||||
Provision (benefit) for income taxes |
34 |
(68 |
) | 60 |
102 |
150 |
% | |||||||||||||
Income (loss) from continuing operations |
13 |
(348 |
) | 112 |
361 |
104 |
% | |||||||||||||
Adjustments to income (loss) from continuing operations: |
|
|||||||||||||||||||
Net investment (gains) losses, net (2) |
(89 |
) | (35 |
) | (138 |
) | (54 |
) | (154 |
)% | ||||||||||
Expenses related to restructuring |
3 |
— |
— |
3 |
NM |
(1) | ||||||||||||||
Taxes on adjustments |
18 |
7 |
48 |
11 |
157 |
% | ||||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | (55 |
) | $ | (376 |
) | $ | 22 |
$ | 321 |
85 |
% | ||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) |
For the years ended December 31, 2019, 2018 and 2017, net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves of $(7) million, $(6) million and $(4) million, respectively. |
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||||||||||
Long-term care insurance |
$ | 57 |
$ | (348 |
) | $ | 59 |
$ | 405 |
116 |
% | |||||||||
Life insurance |
(181 |
) | (107 |
) | (79 |
) | (74 |
) | (69 |
)% | ||||||||||
Fixed annuities |
69 |
79 |
42 |
(10 |
) | (13 |
)% | |||||||||||||
Total adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | (55 |
) | $ | (376 |
) | $ | 22 |
$ | 321 |
85 |
% | ||||||||
• | Our long-term care insurance business had adjusted operating income available to Genworth Financial, Inc.’s common stockholders of $57 million in 2019 compared to an adjusted operating loss available to Genworth Financial, Inc.’s common stockholders of $348 million in 2018. The increase to income in 2019 from a loss in 2018 was primarily attributable to $360 million of higher premiums and reduced benefits in 2019 from in-force rate actions approved and implemented, favorable impacts from benefit utilization rate updates and favorable development on prior year incurred but not reported claims. For more information on in-force rate actions see “—Significant Developments—U.S. Life Insurance.” These increases were partially offset by higher severity and frequency of new claims, unfavorable claim terminations driven in part by the updates from the 2018 claim reserve review and an increase in incremental reserves of $162 million recorded in connection with an accrual for profits followed by losses in 2019. Included in 2018 was higher claim reserves of $230 million due to the completion of our annual review of our claim reserves in the fourth quarter of 2018 (see “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information). Also included in 2018 was a refinement to our estimate of unreported policy terminations, which resulted in an unfavorable reserve adjustment of $28 million. |
• | The adjusted operating loss available to Genworth Financial, Inc.’s common stockholders in our life insurance business increased $74 million largely from higher lapses primarily associated with our large 20-year term life insurance block issued in 1999 entering its post-level premium period and the continued runoff of our life insurance products. The increase also included a more unfavorable unlocking of $16 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2019 compared to 2018 (see “—Critical Accounting Estimates” for additional information). These increases were partially offset by lower mortality in 2019 compared to 2018. |
• | Adjusted operating income available to Genworth Financial, Inc.’s common stockholders decreased $10 million in our fixed annuities business mainly attributable to $14 million of higher unfavorable charges in connection with loss recognition testing in our fixed immediate annuity products (see “—Critical Accounting Estimates—Future policy benefits” for additional information), partially offset by lower interest credited due to block runoff in 2019. |
• | Our long-term care insurance business increased $22 million largely from $107 million of increased premiums in 2019 from in-force rate actions approved and implemented, partially offset by policy terminations and policies entering paid-up status in 2019. |
• | Our life insurance business decreased $28 million mainly attributable to the continued runoff of our term life insurance products in 2019. |
• | Our long-term care insurance business increased $114 million largely from higher average invested assets and higher gains from limited partnerships in 2019. |
• | Our life insurance business increased $20 million principally related to an increase in investment yields as well as higher income related to favorable prepayment speed adjustments on mortgage-backed securities in 2019. |
• | Our fixed annuities business decreased $63 million largely attributable to lower average invested assets in 2019 due to block runoff. |
• | Net investment gains in our long-term care insurance business increased $53 million primarily related to an increase in unrealized gains from changes in the fair value of equity securities and from higher net gains from the sale of investment securities, partially offset by lower derivative gains in 2019. |
• | Our life insurance business had net investment gains of $11 million in 2019 compared to net investment losses of $6 million in 2018. The change to net investment gains in 2019 was mainly driven by net gains from the sale of investment securities in 2019 compared to net losses in 2018, partially offset by lower gains on embedded derivatives associated with our indexed universal life insurance products in 2019. |
• | Net investment losses in our fixed annuities business increased $17 million primarily related to losses on embedded derivatives related to our fixed indexed annuity products in 2019 compared to gains in 2018 and an increase in unrealized losses from changes in the fair value of equity securities, partially offset by gains on derivatives in 2019 compared to losses in 2018. |
• | Our long-term care insurance business decreased $393 million principally related to a higher favorable impact of $357 million from reduced benefits in 2019 related to in-force rate actions approved and implemented. The decrease was also attributable to favorable impacts from benefit utilization rate updates and favorable development on prior year incurred but not reported claims. These decreases were partially offset by the aging of the in-force block (including higher frequency and severity of new claims), unfavorable claim terminations driven in part by the updates from the 2018 claim reserve review and an increase in incremental reserves of $205 million recorded in connection with an accrual for profits followed by losses in 2019. Included in 2018 was higher claim reserves of $291 million, net of reinsurance, related to the completion of our annual review of our claim reserves in the fourth quarter of 2018 (see “—Critical Accounting Estimates—Liability for policy and contract claims” for additional information). Also included in 2018 was a refinement to our estimate of unreported policy terminations, which resulted in an unfavorable reserve adjustment of $36 million. |
• | Our life insurance business decreased $29 million primarily attributable to a less unfavorable unlocking of $30 million in our universal and term universal life insurance products as part of our annual review of assumptions in the fourth quarter of 2019 compared to 2018 (see “—Critical Accounting Estimates—Policyholder account balances” for additional information). The decrease was also attributable to lower mortality in 2019 compared to 2018. These decreases were partially offset by $24 million of unfavorable model corrections in our universal life insurance products in 2019. |
• | Our fixed annuities business decreased $15 million largely attributable to lower interest credited due to block runoff, lower reserves in our fixed indexed annuity products driven mostly by favorable market performance and higher mortality. These decreases were partially offset by $17 million of higher |
reserves recorded in connection with loss recognition testing in our fixed immediate annuity products primarily as a result of a decline in interest rates (see “—Critical Accounting Estimates—Future policy benefits” for additional information). |
• | Our long-term care insurance business increased $7 million primarily related to higher general expenses and legal costs in 2019. |
• | Our life insurance business increased $14 million largely attributable to a net decrease in deferrals in 2019 reflecting recent lapse experience, partially offset by lower operating expenses in 2019 as a result of the continued runoff of our in-force block. |
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Net earned premiums: |
|
|
|
|
||||||||||||||||
Individual long-term care insurance |
$ | 2,464 |
$ | 2,447 |
$ | 2,383 |
$ | 17 |
1 |
% | ||||||||||
Group long-term care insurance |
119 |
114 |
110 |
5 |
4 |
% | ||||||||||||||
Total |
$ | 2,583 |
$ | 2,561 |
$ | 2,493 |
$ | 22 |
1 |
% | ||||||||||
Loss ratio |
77 |
% | 95 |
% | 76 |
% | (18 |
)% |
As of or for years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Term and whole life insurance |
||||||||||||||||||||
Net earned premiums |
$ | 278 |
$ | 306 |
$ | 429 |
$ | (28 |
) | (9 |
)% | |||||||||
Life insurance in-force, net of reinsurance |
81,644 |
97,542 |
103,654 |
(15,898 |
) | (16 |
)% | |||||||||||||
Life insurance in-force before reinsurance |
399,887 |
434,563 |
460,706 |
(34,676 |
) | (8 |
)% | |||||||||||||
Term universal life insurance |
||||||||||||||||||||
Net deposits |
$ | 228 |
$ | 235 |
$ | 242 |
$ | (7 |
) | (3 |
)% | |||||||||
Life insurance in-force, net of reinsurance |
112,720 |
115,608 |
118,678 |
(2,888 |
) | (2 |
)% | |||||||||||||
Life insurance in-force before reinsurance |
113,487 |
116,407 |
119,526 |
(2,920 |
) | (3 |
)% | |||||||||||||
Universal life insurance |
||||||||||||||||||||
Net deposits |
$ | 360 |
$ | 510 |
$ | 355 |
$ | (150 |
) | (29 |
)% | |||||||||
Life insurance in-force, net of reinsurance |
33,917 |
35,299 |
36,916 |
(1,382 |
) | (4 |
)% | |||||||||||||
Life insurance in-force before reinsurance |
38,566 |
40,188 |
42,158 |
(1,622 |
) | (4 |
)% | |||||||||||||
Total life insurance |
||||||||||||||||||||
Net earned premiums and deposits |
$ | 866 |
$ | 1,051 |
$ | 1,026 |
$ | (185 |
) | (18 |
)% | |||||||||
Life insurance in-force, net of reinsurance |
228,281 |
248,449 |
259,248 |
(20,168 |
) | (8 |
)% | |||||||||||||
Life insurance in-force before reinsurance |
551,940 |
591,158 |
622,390 |
(39,218 |
) | (7 |
)% |
As of or for years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Account value, beginning of period |
$ | 14,348 |
$ | 16,401 |
$ | 17,720 |
$ | (2,053 |
) | (13 |
)% | |||||||||
Deposits |
85 |
87 |
97 |
(2 |
) | (2 |
)% | |||||||||||||
Surrenders, benefits and product charges |
(2,137 |
) | (2,318 |
) | (2,084 |
) | 181 |
8 |
% | |||||||||||
Net flows |
(2,052 |
) | (2,231 |
) | (1,987 |
) | 179 |
8 |
% | |||||||||||
Interest credited and investment performance |
486 |
429 |
585 |
57 |
13 |
% | ||||||||||||||
Effect of accumulated net unrealized investment gains (losses) |
241 |
(251 |
) | 83 |
492 |
196 |
% | |||||||||||||
Account value, end of period |
$ | 13,023 |
$ | 14,348 |
$ | 16,401 |
$ | (1,325 |
) | (9 |
)% | |||||||||
|
Years ended December 31, |
Increase (decrease) and percentage change |
||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Revenues: |
|
|||||||||||||||||||
Net investment income |
$ | 187 |
$ | 174 |
$ | 160 |
$ | 13 |
7 |
% | ||||||||||
Net investment gains (losses) |
(25 |
) | (33 |
) | 16 |
8 |
24 |
% | ||||||||||||
Policy fees and other income |
140 |
153 |
163 |
(13 |
) | (8 |
)% | |||||||||||||
Total revenues |
302 |
294 |
339 |
8 |
3 |
% | ||||||||||||||
Benefits and expenses: |
|
|||||||||||||||||||
Benefits and other changes in policy reserves |
27 |
39 |
26 |
(12 |
) | (31 |
)% | |||||||||||||
Interest credited |
158 |
150 |
140 |
8 |
5 |
% | ||||||||||||||
Acquisition and operating expenses, net of deferrals |
52 |
57 |
61 |
(5 |
) | (9 |
)% | |||||||||||||
Amortization of deferred acquisition costs and intangibles |
18 |
33 |
24 |
(15 |
) | (45 |
)% | |||||||||||||
Total benefits and expenses |
255 |
279 |
253 |
(24 |
) | (9 |
)% | |||||||||||||
Income from continuing operations before income taxes |
47 |
15 |
86 |
32 |
NM |
(1) | ||||||||||||||
Provision for income taxes |
8 |
2 |
25 |
6 |
NM |
(1) | ||||||||||||||
Income from continuing operations |
39 |
13 |
61 |
26 |
200 |
% | ||||||||||||||
Adjustment to income from continuing operations: |
||||||||||||||||||||
Net investment (gains) losses, net (2) |
21 |
27 |
(15 |
) | (6 |
) | (22 |
)% | ||||||||||||
Taxes on adjustments |
(4 |
) | (5 |
) | 5 |
1 |
20 |
% | ||||||||||||
Adjusted operating income available to Genworth Financial, Inc.’s common stockholders |
$ | 56 |
$ | 35 |
$ | 51 |
$ | 21 |
60 |
% | ||||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
(2) |
For the years ended December 31, 2019, 2018 and 2017, net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves of $(4) million, $(6) million and $1 million, respectively. |
As of or for the years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Account value, beginning of period |
$ | 4,918 |
$ | 5,884 |
$ | 6,031 |
$ | (966 |
) | (16 |
)% | |||||||||
Deposits |
25 |
26 |
30 |
(1 |
) | (4 |
)% | |||||||||||||
Surrenders, benefits and product charges |
(640 |
) | (764 |
) | (828 |
) | 124 |
16 |
% | |||||||||||
Net flows |
(615 |
) | (738 |
) | (798 |
) | 123 |
17 |
% | |||||||||||
Interest credited and investment performance |
739 |
(228 |
) | 651 |
967 |
NM |
(1) | |||||||||||||
Account value, end of period |
$ | 5,042 |
$ | 4,918 |
$ | 5,884 |
$ | 124 |
3 |
% | ||||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
As of or for the years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Account value, beginning of period |
$ | 381 |
$ | 260 |
$ | 560 |
$ | 121 |
47 |
% | ||||||||||
Deposits |
— |
200 |
— |
(200 |
) | (100 |
)% | |||||||||||||
Surrenders and benefits |
(136 |
) | (85 |
) | (308 |
) | (51 |
) | (60 |
)% | ||||||||||
Net flows |
(136 |
) | 115 |
(308 |
) | (251 |
) | NM |
(1) | |||||||||||
Interest credited |
8 |
6 |
8 |
2 |
33 |
% | ||||||||||||||
Account value, end of period |
$ | 253 |
$ | 381 |
$ | 260 |
$ | (128 |
) | (34 |
)% | |||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
Years ended December 31, |
Increase (decrease) and percentage change |
|||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 vs. 2018 |
||||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | 8 |
$ | 8 |
$ | 8 |
$ | — |
— |
% | ||||||||||
Net investment income |
9 |
6 |
3 |
3 |
50 |
% | ||||||||||||||
Net investment gains (losses) |
(31 |
) | 10 |
(38 |
) | (41 |
) | NM |
(1) | |||||||||||
Policy fees and other income |
2 |
(3 |
) | (2 |
) | 5 |
167 |
% | ||||||||||||
Total revenues |
(12 |
) | 21 |
(29 |
) | (33 |
) | (157 |
)% | |||||||||||
Benefits and expenses: |
||||||||||||||||||||
Benefits and other changes in policy reserves |
3 |
5 |
3 |
(2 |
) | (40 |
)% | |||||||||||||
Acquisition and operating expenses, net of deferrals |
46 |
68 |
92 |
(22 |
) | (32 |
)% | |||||||||||||
Amortization of deferred acquisition costs and intangibles |
3 |
1 |
2 |
2 |
200 |
% | ||||||||||||||
Interest expense |
214 |
231 |
242 |
(17 |
) | (7 |
)% | |||||||||||||
Total benefits and expenses |
266 |
305 |
339 |
(39 |
) | (13 |
)% | |||||||||||||
Loss from continuing operations before income taxes |
(278 |
) | (284 |
) | (368 |
) | 6 |
2 |
% | |||||||||||
Benefit for income taxes |
(53 |
) | (56 |
) | (576 |
) | 3 |
5 |
% | |||||||||||
Income (loss) from continuing operations |
(225 |
) | (228 |
) | 208 |
3 |
1 |
% | ||||||||||||
Adjustments to income (loss) from continuing operations: |
||||||||||||||||||||
Net investment (gains) losses |
31 |
(10 |
) | 38 |
41 |
NM |
(1) | |||||||||||||
Expenses related to restructuring |
1 |
2 |
1 |
(1 |
) | (50 |
)% | |||||||||||||
Fees associated with bond consent solicitation |
— |
6 |
— |
(6 |
) | (100 |
)% | |||||||||||||
Taxes on adjustments |
(7 |
) | — |
(13 |
) | (7 |
) | NM |
(1) | |||||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | (200 |
) | $ | (230 |
) | $ | 234 |
$ | 30 |
13 |
% | ||||||||
(1) |
We define “NM” as not meaningful for increases or decreases greater than 200%. |
Increase (decrease) |
||||||||||||||||||||||||||||||||
2019 |
2018 |
2017 |
2019 vs. 2018 |
|||||||||||||||||||||||||||||
(Amounts in millions) |
Yield |
Amount |
Yield |
Amount |
Yield |
Amount |
Yield |
Amount |
||||||||||||||||||||||||
Fixed maturity securities—taxable |
4.6 |
% | $ | 2,494 |
4.6 |
% | $ | 2,456 |
4.7 |
% | $ | 2,458 |
— |
% | $ | 38 |
||||||||||||||||
Fixed maturity securities— non-taxable |
6.1 |
% | 8 |
4.0 |
% | 11 |
3.7 |
% | 12 |
2.1 |
% | (3 |
) | |||||||||||||||||||
Equity securities |
6.3 |
% | 16 |
6.3 |
% | 20 |
5.6 |
% | 19 |
— |
% | (4 |
) | |||||||||||||||||||
Commercial mortgage loans |
5.0 |
% | 344 |
4.9 |
% | 320 |
4.9 |
% | 306 |
0.1 |
% | 24 |
||||||||||||||||||||
Restricted commercial mortgage loans related to a securitization entity (1) |
7.3 |
% | 4 |
7.9 |
% | 7 |
7.7 |
% | 9 |
(0.6 |
)% | (3 |
) | |||||||||||||||||||
Policy loans |
8.9 |
% | 180 |
9.2 |
% | 169 |
8.6 |
% | 153 |
(0.3 |
)% | 11 |
||||||||||||||||||||
Other invested assets (2) |
27.6 |
% | 234 |
37.2 |
% | 181 |
46.9 |
% | 157 |
(9.6 |
)% | 53 |
||||||||||||||||||||
Restricted other invested assets related to securitization entities (1) |
— |
% | — |
— |
% | — |
1.1 |
% | 1 |
— |
% | — |
||||||||||||||||||||
Cash, cash equivalents, restricted cash and short-term investments |
1.7 |
% | 39 |
1.7 |
% | 48 |
1.0 |
% | 35 |
— |
% | (9 |
) | |||||||||||||||||||
Gross investment income before expenses and fees |
5.0 |
% | 3,319 |
4.9 |
% | 3,212 |
4.8 |
% | 3,150 |
0.1 |
% | 107 |
||||||||||||||||||||
Expenses and fees |
(0.1 |
)% | (99 |
) | (0.1 |
)% | (91 |
) | (0.1 |
)% | (84 |
) | — |
% | (8 |
) | ||||||||||||||||
Net investment income |
4.9 |
% | $ | 3,220 |
4.8 |
% | $ | 3,121 |
4.7 |
% | $ | 3,066 |
0.1 |
% | $ | 99 |
||||||||||||||||
Average invested assets and cash |
$ | 66,280 |
$ | 65,527 |
$ | 65,384 |
$ | 753 |
||||||||||||||||||||||||
(1) |
See note 17 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information related to consolidated securitization entities. |
(2) |
Investment income for other invested assets includes amortization of terminated cash flow hedges, which have no corresponding book value within the yield calculation and includes limited partnership investments, which are primarily equity-based and do not have fixed returns by period. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Available-for-sale securities: |
||||||||||||
Realized gains |
$ | 107 |
$ | 162 |
$ | 205 |
||||||
Realized losses |
(39 |
) | (137 |
) | (64 |
) | ||||||
Net realized gains (losses) on available-for-sale securities |
68 |
25 |
141 |
|||||||||
Impairments: |
||||||||||||
Total other-than-temporary impairments |
(1 |
) | — |
(6 |
) | |||||||
Portion of other-than-temporary impairments included in other comprehensive income (loss) |
— |
— |
— |
|||||||||
Net other-than-temporary impairments |
(1 |
) | — |
(6 |
) | |||||||
Net realized gains (losses) on equity securities sold |
9 |
11 |
— |
|||||||||
Net unrealized gains (losses) on equity securities still held |
14 |
(34 |
) | — |
||||||||
Trading securities |
— |
— |
1 |
|||||||||
Limited partnerships |
29 |
11 |
— |
|||||||||
Commercial mortgage loans |
(2 |
) | — |
3 |
||||||||
Net gains (losses) related to securitization entities (1) |
— |
— |
7 |
|||||||||
Derivative instruments |
(72 |
) | (22 |
) | (9 |
) | ||||||
Other |
5 |
— |
— |
|||||||||
Net investment gains (losses) |
$ | 50 |
$ | (9 |
) | $ | 137 |
|||||
(1) |
See note 17 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information related to consolidated securitization entities. |
• | We recorded $43 million of higher net gains related to the sale of fixed maturity securities in 2019 compared to 2018 primarily from the sale of corporate securities driven mostly by cash tenders from merger and acquisition activity in 2019. |
• | Net investment losses related to derivatives of $72 million in 2019 were primarily associated with hedging programs that support our runoff variable annuity products, losses related to hedging programs for our fixed indexed annuity products and decreases in the values of investments used to protect statutory surplus from equity market fluctuations. These losses were partially offset by gains from hedging programs related to our indexed universal life insurance products. |
• | We recorded net unrealized gains related to equity securities of $14 million in 2019 from favorable mark-to-market adjustments compared to net unrealized losses of $34 million in 2018. We also recorded $18 million of higher gains related to limited partnerships primarily driven by changes in the fair value of these investments. |
2019 |
2018 |
|||||||||||||||
(Amounts in millions) |
Carrying value |
% of total |
Carrying value |
% of total |
||||||||||||
Fixed maturity securities, available-for-sale: |
||||||||||||||||
Public |
$ | 42,162 |
57 |
% | $ | 39,389 |
58 |
% | ||||||||
Private |
18,177 |
24 |
16,200 |
24 |
||||||||||||
Equity securities |
239 |
— |
275 |
— |
||||||||||||
Commercial mortgage loans |
6,916 |
9 |
6,687 |
10 |
||||||||||||
Restricted commercial mortgage loans related to a securitization entity (1) |
47 |
— |
62 |
— |
||||||||||||
Policy loans |
2,058 |
3 |
1,861 |
3 |
||||||||||||
Other invested assets |
1,632 |
2 |
1,072 |
2 |
||||||||||||
Cash, cash equivalents and restricted cash |
3,341 |
5 |
1,974 |
3 |
||||||||||||
Total cash, cash equivalents, restricted cash and invested assets |
$ | 74,572 |
100 |
% | $ | 67,520 |
100 |
% | ||||||||
(1) |
See note 17 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information related to a consolidated securitization entity. |
Gross unrealized gains |
Gross unrealized losses |
|||||||||||||||||||||||
Amortized |
Not other-than- |
Other-than- |
Not other-than- |
Other-than- |
||||||||||||||||||||
cost or |
temporarily |
temporarily |
temporarily |
temporarily |
Fair |
|||||||||||||||||||
(Amounts in millions) |
cost |
impaired |
impaired |
impaired |
impaired |
value |
||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises |
$ | 4,073 |
$ | 952 |
$ | — |
$ | — |
$ | — |
$ | 5,025 |
||||||||||||
State and political subdivisions |
2,394 |
355 |
— |
(2 |
) | — |
2,747 |
|||||||||||||||||
Non-U.S. government |
1,235 |
117 |
— |
(2 |
) | — |
1,350 |
|||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||
Utilities |
4,322 |
675 |
— |
— |
— |
4,997 |
||||||||||||||||||
Energy |
2,404 |
303 |
— |
(8 |
) | — |
2,699 |
|||||||||||||||||
Finance and insurance |
6,977 |
798 |
— |
(1 |
) | — |
7,774 |
|||||||||||||||||
Consumer—non-cyclical |
4,909 |
796 |
— |
(4 |
) | — |
5,701 |
|||||||||||||||||
Technology and communications |
2,883 |
363 |
— |
(1 |
) | — |
3,245 |
|||||||||||||||||
Industrial |
1,271 |
125 |
— |
— |
— |
1,396 |
||||||||||||||||||
Capital goods |
2,345 |
367 |
— |
(1 |
) | — |
2,711 |
|||||||||||||||||
Consumer—cyclical |
1,590 |
172 |
— |
(2 |
) | — |
1,760 |
|||||||||||||||||
Transportation |
1,320 |
187 |
— |
(1 |
) | — |
1,506 |
|||||||||||||||||
Other |
292 |
30 |
— |
— |
— |
322 |
||||||||||||||||||
Total U.S. corporate |
28,313 |
3,816 |
— |
(18 |
) | — |
32,111 |
|||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||
Utilities |
779 |
50 |
— |
— |
— |
829 |
||||||||||||||||||
Energy |
1,140 |
179 |
— |
— |
— |
1,319 |
||||||||||||||||||
Finance and insurance |
2,087 |
232 |
— |
— |
— |
2,319 |
||||||||||||||||||
Consumer—non-cyclical |
631 |
55 |
— |
(2 |
) | — |
684 |
|||||||||||||||||
Technology and communications |
1,010 |
128 |
— |
— |
— |
1,138 |
||||||||||||||||||
Industrial |
896 |
92 |
— |
— |
— |
988 |
||||||||||||||||||
Capital goods |
565 |
40 |
— |
— |
— |
605 |
||||||||||||||||||
Consumer—cyclical |
373 |
24 |
— |
— |
— |
397 |
||||||||||||||||||
Transportation |
557 |
73 |
— |
(1 |
) | — |
629 |
|||||||||||||||||
Other |
1,431 |
188 |
— |
(2 |
) | — |
1,617 |
|||||||||||||||||
Total non-U.S. corporate |
9,469 |
1,061 |
— |
(5 |
) | — |
10,525 |
|||||||||||||||||
Residential mortgage-backed (1) |
2,057 |
199 |
15 |
(1 |
) | — |
2,270 |
|||||||||||||||||
Commercial mortgage-backed |
2,897 |
137 |
— |
(8 |
) | — |
3,026 |
|||||||||||||||||
Other asset-backed |
3,262 |
30 |
— |
(7 |
) | — |
3,285 |
|||||||||||||||||
Total available-for-sale fixed maturity securities |
$ | 53,700 |
$ | 6,667 |
$ | 15 |
$ | (43 |
) | $ | — |
$ | 60,339 |
|||||||||||
(1) |
Fair value included $9 million collateralized by Alt-A residential mortgage loans and $24 million collateralized by sub-prime residential mortgage loans. |
Gross unrealized gains |
Gross unrealized losses |
|||||||||||||||||||||||
Amortized |
Not other-than- |
Other-than- |
Not other-than- |
Other-than- |
||||||||||||||||||||
cost or |
temporarily |
temporarily |
temporarily |
temporarily |
Fair |
|||||||||||||||||||
(Amounts in millions) |
cost |
impaired |
impaired |
impaired |
impaired |
value |
||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises |
$ | 4,175 |
$ | 473 |
$ | — |
$ | (17 |
) | $ | — |
$ | 4,631 |
|||||||||||
State and political subdivisions |
2,406 |
168 |
— |
(22 |
) | — |
2,552 |
|||||||||||||||||
Non-U.S. government |
1,232 |
44 |
— |
(8 |
) | — |
1,268 |
|||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||
Utilities |
4,439 |
331 |
— |
(95 |
) | — |
4,675 |
|||||||||||||||||
Energy |
2,375 |
101 |
— |
(64 |
) | — |
2,412 |
|||||||||||||||||
Finance and insurance |
6,691 |
249 |
— |
(132 |
) | — |
6,808 |
|||||||||||||||||
Consumer—non-cyclical |
4,879 |
294 |
— |
(137 |
) | — |
5,036 |
|||||||||||||||||
Technology and communications |
2,809 |
110 |
— |
(78 |
) | — |
2,841 |
|||||||||||||||||
Industrial |
1,213 |
41 |
— |
(33 |
) | — |
1,221 |
|||||||||||||||||
Capital goods |
2,277 |
165 |
— |
(51 |
) | — |
2,391 |
|||||||||||||||||
Consumer—cyclical |
1,592 |
53 |
— |
(48 |
) | — |
1,597 |
|||||||||||||||||
Transportation |
1,283 |
78 |
— |
(41 |
) | — |
1,320 |
|||||||||||||||||
Other |
376 |
24 |
— |
(3 |
) | — |
397 |
|||||||||||||||||
Total U.S. corporate |
27,934 |
1,446 |
— |
(682 |
) | — |
28,698 |
|||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||
Utilities |
838 |
12 |
— |
(29 |
) | — |
821 |
|||||||||||||||||
Energy |
1,170 |
71 |
— |
(20 |
) | — |
1,221 |
|||||||||||||||||
Finance and insurance |
2,071 |
71 |
— |
(36 |
) | — |
2,106 |
|||||||||||||||||
Consumer—non-cyclical |
706 |
8 |
— |
(24 |
) | — |
690 |
|||||||||||||||||
Technology and communications |
1,043 |
21 |
— |
(24 |
) | — |
1,040 |
|||||||||||||||||
Industrial |
896 |
36 |
— |
(16 |
) | — |
916 |
|||||||||||||||||
Capital goods |
571 |
10 |
— |
(9 |
) | — |
572 |
|||||||||||||||||
Consumer—cyclical |
322 |
1 |
— |
(10 |
) | — |
313 |
|||||||||||||||||
Transportation |
580 |
44 |
— |
(14 |
) | — |
610 |
|||||||||||||||||
Other |
1,414 |
85 |
— |
(18 |
) | — |
1,481 |
|||||||||||||||||
Total non-U.S. corporate |
9,611 |
359 |
— |
(200 |
) | — |
9,770 |
|||||||||||||||||
Residential mortgage-backed (1) |
2,460 |
159 |
13 |
(14 |
) | — |
2,618 |
|||||||||||||||||
Commercial mortgage-backed |
3,054 |
43 |
— |
(81 |
) | — |
3,016 |
|||||||||||||||||
Other asset-backed |
3,048 |
10 |
1 |
(23 |
) | — |
3,036 |
|||||||||||||||||
Total available-for-sale fixed maturity securities |
$ | 53,920 |
$ | 2,702 |
$ | 14 |
$ | (1,047 |
) | $ | — |
$ | 55,589 |
|||||||||||
(1) |
Fair value included $19 million collateralized by Alt-A residential mortgage loans and $22 million collateralized by sub-prime residential mortgage loans. |
2019 |
||||||||||||||||||||
(Dollar amounts in millions) |
Total recorded investment |
Number of loans |
Loan-to-value (1) |
Delinquent principal balance |
Number of delinquent loans |
|||||||||||||||
Loan Year |
||||||||||||||||||||
2008 and prior |
$ | 1,094 |
381 |
37 |
% | $ | — |
— |
||||||||||||
2009 |
— |
— |
— |
% | — |
— |
||||||||||||||
2010 |
41 |
8 |
33 |
% | — |
— |
||||||||||||||
2011 |
168 |
42 |
38 |
% | — |
— |
||||||||||||||
2012 |
415 |
75 |
42 |
% | — |
— |
||||||||||||||
2013 |
579 |
114 |
47 |
% | — |
— |
||||||||||||||
2014 |
720 |
129 |
50 |
% | — |
— |
||||||||||||||
2015 |
833 |
136 |
56 |
% | — |
— |
||||||||||||||
2016 |
517 |
93 |
59 |
% | — |
— |
||||||||||||||
2017 |
740 |
141 |
61 |
% | — |
— |
||||||||||||||
2018 |
1,019 |
165 |
66 |
% | — |
— |
||||||||||||||
2019 |
807 |
111 |
71 |
% | — |
— |
||||||||||||||
Total |
$ | 6,933 |
1,395 |
54 |
% | $ | — |
— |
||||||||||||
(1) |
Represents weighted-average loan-to-value as of December 31, 2019. |
2018 |
||||||||||||||||||||
(Dollar amounts in millions) |
Total recorded investment |
Number of loans |
Loan-to-value (1) |
Delinquent principal balance |
Number of delinquent loans |
|||||||||||||||
Loan Year |
||||||||||||||||||||
2008 and prior |
$ | 1,310 |
459 |
39 |
% | $ | 3 |
1 |
||||||||||||
2009 |
— |
— |
— |
% | — |
— |
||||||||||||||
2010 |
50 |
11 |
37 |
% | — |
— |
||||||||||||||
2011 |
193 |
46 |
41 |
% | — |
— |
||||||||||||||
2012 |
476 |
81 |
45 |
% | — |
— |
||||||||||||||
2013 |
656 |
122 |
48 |
% | 3 |
1 |
||||||||||||||
2014 |
772 |
133 |
53 |
% | — |
— |
||||||||||||||
2015 |
877 |
139 |
58 |
% | — |
— |
||||||||||||||
2016 |
553 |
96 |
61 |
% | — |
— |
||||||||||||||
2017 |
773 |
144 |
66 |
% | — |
— |
||||||||||||||
2018 |
1,040 |
165 |
69 |
% | — |
— |
||||||||||||||
Total |
$ | 6,700 |
1,396 |
54 |
% | $ | 6 |
2 |
||||||||||||
(1) |
Represents weighted-average loan-to-value as of December 31, 2018. |
2019 |
2018 |
|||||||||||||||
(Amounts in millions) |
Carrying value |
% of total |
Carrying value |
% of total |
||||||||||||
Limited partnerships |
$ | 634 |
39 |
% | $ | 409 |
38 |
% | ||||||||
Bank loan investments |
383 |
23 |
248 |
23 |
||||||||||||
Derivatives |
290 |
18 |
97 |
9 |
||||||||||||
Short-term investments |
260 |
16 |
195 |
18 |
||||||||||||
Securities lending collateral |
51 |
3 |
102 |
10 |
||||||||||||
Other investments |
14 |
1 |
21 |
2 |
||||||||||||
Total other invested assets |
$ | 1,632 |
100 |
% | $ | 1,072 |
100 |
% | ||||||||
December 31, |
Maturities/ |
December 31, |
||||||||||||||||||
(Notional in millions) |
Measurement |
2018 |
Additions |
terminations |
2019 |
|||||||||||||||
Derivatives designated as hedges |
||||||||||||||||||||
Cash flow hedges: |
||||||||||||||||||||
Interest rate swaps |
Notional |
$ | 9,924 |
$ | 1,414 |
$ | (2,370 |
) | $ | 8,968 |
||||||||||
Foreign currency swaps |
Notional |
80 |
52 |
(22 |
) | 110 |
||||||||||||||
Total cash flow hedges |
10,004 |
1,466 |
(2,392 |
) | 9,078 |
|||||||||||||||
Total derivatives designated as hedges |
10,004 |
1,466 |
(2,392 |
) | 9,078 |
|||||||||||||||
Derivatives not designated as hedges |
||||||||||||||||||||
Interest rate swaps |
Notional |
4,674 |
— |
— |
4,674 |
|||||||||||||||
Interest rate caps |
Notional |
424 |
— |
(424 |
) | — |
||||||||||||||
Equity index options |
Notional |
2,628 |
2,479 |
(2,656 |
) | 2,451 |
||||||||||||||
Financial futures |
Notional |
1,415 |
5,568 |
(5,801 |
) | 1,182 |
||||||||||||||
Other foreign currency contracts |
Notional |
646 |
6,799 |
(6,817 |
) | 628 |
||||||||||||||
Total derivatives not designated as hedges |
9,787 |
14,846 |
(15,698 |
) | 8,935 |
|||||||||||||||
Total derivatives |
$ | 19,791 |
$ | 16,312 |
$ | (18,090 |
) | $ | 18,013 |
|||||||||||
December 31, |
Maturities/ |
December 31, |
||||||||||||||||||
(Number of policies) |
Measurement |
2018 |
Additions |
terminations |
2019 |
|||||||||||||||
Derivatives not designated as hedges |
||||||||||||||||||||
GMWB embedded derivatives |
Policies |
27,886 |
— |
(2,263 |
) | 25,623 |
||||||||||||||
Fixed index annuity embedded derivatives |
Policies |
16,464 |
— |
(1,023 |
) | 15,441 |
||||||||||||||
Indexed universal life embedded derivatives |
Policies |
929 |
— |
(45 |
) | 884 |
• | Cash, cash equivalents, restricted cash and invested assets increased $7,052 million primarily from increases of $4,750 million, $1,367 million, $560 million, $214 million and $197 million in fixed maturity securities, cash and cash equivalents, other invested assets, commercial mortgage loans and policy loans, respectively. The increase in fixed maturity securities was predominantly related to higher unrealized gains principally from a decrease in interest rates, partially offset by net sales and maturities in 2019. The increase in cash and cash equivalents was principally related to the net cash proceeds received from the Genworth Canada sale. The increase in other invested assets was primarily from higher market values of derivative assets driven mostly by a decrease in interest rates and from an increase in limited partnership and bank loan investments in 2019. Commercial mortgage loans increased from higher originations and lower prepayments in 2019. The increase in policy loans was principally driven by new loans offered through our corporate-owned life insurance policies collateralized by the cash surrender value of the policy. |
• | DAC decreased $1,306 million predominantly driven by shadow accounting adjustments associated with the recognition of higher unrealized gains. The shadow accounting adjustments decreased the DAC balance by $956 million, mostly in our long-term care insurance business, resulting in a cumulative decrease of $1,444 million to the DAC balance as of December 31, 2019, with an offsetting amount recorded in other comprehensive income (loss). For a discussion of additional information related to shadow accounting, see “—Critical Accounting Estimates.” The decrease was also from higher amortization in our life insurance business associated with higher lapses primarily related to our large 20-year term life insurance block issued in 1999 entering its post-level premium period and $58 million in our universal and term universal life insurance products recorded in connection with our annual review of assumptions in the fourth quarter of 2019. |
• | Reinsurance recoverable decreased $175 million mainly attributable to the runoff of our structured settlement products ceded to UFLIC, an affiliate of our former parent, GE. |
• | Deferred tax asset decreased $311 million primarily due to higher unrealized gains on investments and derivatives in 2019. |
• | Separate account assets increased $249 million primarily due to favorable equity market performance in 2019. |
• | Assets held for sale related to discontinued operations decreased $5,015 million as a result of the sale of Genworth Canada, which closed on December 12, 2019. |
• | Future policy benefits increased $2,444 million primarily driven by shadow accounting adjustments associated with the recognition of higher unrealized gains. The shadow accounting adjustments |
increased future policy benefits by approximately $2,127 million, mostly in our long-term care insurance business, with an offsetting amount recorded in other comprehensive income (loss). The increase was also attributable to aging of our long-term care insurance in-force block and an increase in incremental reserves of $213 million recorded in connection with an accrual for profits followed by losses in 2019. |
• | Policyholder account balances decreased $751 million largely as a result of surrenders and benefits in our fixed annuities business and from scheduled maturities of certain funding agreements in 2019. These decreases were partially offset by an increase associated with shadow accounting adjustments in connection with the recognition of higher unrealized gains mostly in our universal life insurance products in 2019. |
• | Liability for policy and contract claims increased $663 million due principally to our long-term care insurance business primarily attributable to new claims as a result of the aging of the in-force block, including higher frequency and severity of new claims, partially offset by favorable development on prior year incurred but not reported claims in 2019. These increases were partially offset by lower delinquencies in our U.S. mortgage insurance business in 2019. |
• | Unearned premiums decreased $120 million principally related to our Australia mortgage insurance business due primarily to earned premiums outpacing written premiums. Gross written premiums were lower in 2019 compared to prior years, but have begun to normalize driven in part by higher mortgage origination volume from certain key customers. The decrease was also attributable to our long-term care insurance business predominantly from policy terminations and policies entering paid-up status in 2019. |
• | Long-term borrowings decreased $430 million mainly attributable to the repayment of Genworth Holdings’ Term Loan, which was originally closed on March 7, 2018 and was scheduled to mature in March 2023. The Term Loan required early repayment due to the sale of Genworth Canada. |
• | Liabilities held for sale related to discontinued operations decreased $2,112 million as a result of the sale of Genworth Canada, which closed on December 12, 2019. |
• | We reported net income available to Genworth Financial, Inc.’s common stockholders of $343 million for the year ended December 31, 2019. |
• | Net unrealized gains and derivatives qualifying as hedges increased $861 million and $221 million, respectively, primarily from a decrease in interest rates in 2019. |
• | Foreign currency translation and other adjustments increased $307 million principally from the recognition of Genworth Canada’s cumulative foreign currency translation losses as part of the loss on sale recorded in connection with final disposition completed on December 12, 2019. |
• | Noncontrolling interests decreased $1,292 million predominantly related to the deconsolidation of the ownership interest attributable to noncontrolling interests of Genworth Canada recorded in connection with the final disposition completed on December 12, 2019. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Net cash from operating activities |
$ | 2,079 |
$ | 1,633 |
$ | 2,554 |
||||||
Net cash from (used by) investing activities |
1,301 |
(622 |
) | (759 |
) | |||||||
Net cash used by financing activities |
(2,217 |
) | (1,621 |
) | (1,768 |
) | ||||||
Net increase (decrease) in cash before foreign exchange effect |
$ | 1,163 |
$ | (610 |
) | $ | 27 |
|||||
Payments due by period |
||||||||||||||||||||
(Amounts in millions) |
Total |
2020 |
2021-2022 |
2023-2024 |
2025 and thereafter |
|||||||||||||||
Borrowings and interest (1) |
$ | 5,457 |
$ | 583 |
$ | 1,332 |
$ | 956 |
$ | 2,586 |
||||||||||
Operating lease obligations (2) |
81 |
9 |
19 |
14 |
39 |
|||||||||||||||
Other purchase liabilities (3) |
31 |
21 |
9 |
1 |
— |
|||||||||||||||
Securities lending (4) |
51 |
51 |
— |
— |
— |
|||||||||||||||
Commercial mortgage loan commitments (5) |
30 |
30 |
— |
— |
— |
|||||||||||||||
Bank loan investment commitments (5) |
52 |
52 |
— |
— |
— |
|||||||||||||||
Limited partnership commitments (5) |
976 |
279 |
432 |
233 |
32 |
|||||||||||||||
Private placement commitments (5) |
39 |
39 |
— |
— |
— |
|||||||||||||||
Insurance liabilities (6) |
118,270 |
3,190 |
6,239 |
4,954 |
103,887 |
|||||||||||||||
Tax matters agreement (7) |
60 |
15 |
29 |
16 |
— |
|||||||||||||||
Unrecognized tax benefits (8) |
64 |
— |
— |
— |
64 |
|||||||||||||||
Total contractual obligations |
$ | 125,111 |
$ | 4,269 |
$ | 8,060 |
$ | 6,174 |
$ | 106,608 |
||||||||||
(1) |
Includes payments of principal and interest on our long-term borrowings and non-recourse funding obligations. On January 21, 2020, Genworth Holdings early redeemed $397 million of its 7.70% senior notes originally scheduled to mature in June 2020. The senior notes were fully redeemed with a cash payment of $409 million, comprised of the outstanding principal balance, accrued interest and a make-whole premium of approximately $9 million. In January 2020, Rivermont I redeemed all of its $315 million of outstanding non-recourse funding obligations due in 2050. The total amount for borrowings and interest in this table does not equal the amounts on our consolidated balance sheet as it excludes debt issuance costs, premiums and discounts and includes interest that is expected to be payable in future years. See note 12 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for information related to the timing of payments and the maturity dates of these borrowings. |
(2) |
Includes the undiscounted lease payments required under our operating leases obligations. The related operating lease liability is recorded on our consolidated balance sheet net of imputed interest of $24 million. See note 2 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information related to operating leases. |
(3) |
Includes contractual purchase commitments for goods and services entered into in the ordinary course of business and includes obligations under our pension liabilities. |
(4) |
The timing for the return of the collateral associated with our securities lending program is generally overnight and continuous; therefore, the return of collateral is reflected as being due in 2020. See note 12 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information. |
(5) |
Includes amounts we are committed to fund for U.S. commercial mortgage loans, bank loan investments, interests in limited partnerships and private placement investments. |
(6) |
The obligations in this table have not been discounted at present value. In contrast to this table, our obligations reported in our consolidated balance sheet are recorded in accordance with U.S. GAAP where the liabilities are discounted consistent with the present value concept under accounting guidance related to accounting and reporting by insurance enterprises, as applicable. Therefore, the estimated obligations for insurance liabilities presented in this table significantly exceed the liabilities recorded in reserves for future policy benefits and the liability for policy and contract claims. These amounts also include estimated claims and benefits, policy surrender and commission obligations calculated consistent with U.S. GAAP on in-force long-duration insurance policies and investment contracts.
Also includes amounts established for recourse and indemnification related to our U.S. mortgage insurance contract underwriting business. Estimated claim and benefit obligations are based on mortality, morbidity, lapse and other assumptions. Due to the significance of the assumptions used, the amounts presented could materially differ from actual results. We have not included separate account obligations as these obligations are legally insulated from general account obligations and will be fully funded by cash flows from separate account assets. We expect to fully fund the obligations for insurance liabilities from cash flows from general account investments and future deposits and premiums. |
(7) |
Because their future cash outflows are uncertain, the following non-current liabilities are excluded from this table: deferred taxes (except the fixed payments related to the Tax Matters Agreement, which is included, as described in note 13 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data”), derivatives, unearned premiums and certain other items. |
(8) |
Includes the settlement of uncertain tax positions, with related interest, based on the estimated timing of the resolution of income tax examinations in multiple jurisdictions. See notes 2 and 13 to our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for a discussion of uncertain tax positions. |
Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk |
• | reducing the risk between the timing of the receipt of cash and its investment in the market; and |
• | extending or shortening the duration of assets to better align with the duration of the liabilities. |
2019 |
2018 |
|||||||||||||||||||||||
(Amounts in millions) |
Principal amount |
Weighted- average interest rate |
Fair value (1) |
Principal amount |
Weighted- average interest rate |
Fair value (1) |
||||||||||||||||||
Maturity: |
|
|
|
|
||||||||||||||||||||
Floating rate notes: |
|
|
|
|
||||||||||||||||||||
Senior secured term loan facility, 2023 (2) |
$ | — |
— |
% | $ | — |
$ | 438 |
6.58 |
% | $ | 440 |
||||||||||||
Junior subordinated notes, 2025 (3) |
140 |
4.95 |
% | 142 |
140 |
5.46 |
% | 143 |
||||||||||||||||
Junior subordinated notes, 2066 (4) |
585 |
4.41 |
% | 358 |
585 |
4.13 |
% | 316 |
||||||||||||||||
Total floating rate notes |
725 |
4.51 |
% | 500 |
1,163 |
5.21 |
% | 899 |
||||||||||||||||
Non-recourse funding obligations: |
|
|
||||||||||||||||||||||
Rivermont Insurance Company I, 2050 (5) |
311 |
3.78 |
% | 207 |
311 |
4.49 |
% | 215 |
||||||||||||||||
Total non-recourse funding obligations |
311 |
3.78 |
% | 207 |
311 |
4.49 |
% | 215 |
||||||||||||||||
Total floating rate debt |
$ | 1,036 |
$ | 707 |
$ | 1,474 |
$ | 1,114 |
||||||||||||||||
(1) |
The valuation methodology used is based on the then-current coupon, revalued based on the LIBOR set and current spread assumption based on commercially available data. The model is a floating rate coupon model using the spread assumption to derive the valuation. |
(2) |
On December 12, 2019, Genworth Holdings repaid the Term Loan, which was originally closed on March 7, 2018 and was scheduled to mature in March 2023. |
(3) |
Subordinated floating rate notes issued by Genworth Financial Mortgage Insurance Pty Limited, our indirect majority-owned subsidiary, due in 2025 have an interest rate of three-month Bank Bill Swap reference rate plus a margin of 3.50%. |
(4) |
Floating rate junior notes due in November 2066 have an annual interest rate equal to three-month LIBOR plus 2.0025%. See note 12 in our consolidated financial statements under “Item 8—Financial Statements and Supplementary Data” for additional information. |
(5) |
In January 2020, upon receipt of approval from the Director of Insurance of the State of South Carolina, Rivermont I redeemed all of its $315 million of outstanding non-recourse funding obligations due in 2050. |
Item 8. |
Financial Statements and Supplementary Data |
Page |
||||
Annual Financial Statements: |
||||
180 |
||||
Financial Statements as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017: |
||||
184 |
||||
185 |
||||
186 |
||||
187 |
||||
188 |
||||
Notes to Consolidated Financial Statements: |
||||
189 |
||||
190 |
||||
211 |
||||
212 |
||||
228 |
||||
234 |
||||
235 |
||||
236 |
||||
239 |
||||
242 |
||||
247 |
||||
249 |
||||
253 |
||||
258 |
||||
258 |
||||
262 |
||||
286 |
||||
288 |
||||
293 |
||||
302 |
||||
304 |
||||
309 |
||||
311 |
||||
312 |
||||
315 |
||||
Financial Statement Schedules as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017: |
||||
326 |
||||
327 |
||||
333 |
• | Evaluating the Company’s key assumptions, including the determination of whether to update the key assumptions in the current year, by assessing the consistency of the assumptions with each other, relevant historical and experience data, and industry data, as applicable; |
• | Comparing the Company’s updated future in-force rate actions and morbidity assumptions for long-term care insurance and mortality assumption for traditional life insurance to the Company’s historical experience; and |
• | Evaluating the impact of the key assumption changes by comparing the actual impact to expected impact of the key assumption changes to the results of the loss recognition test. |
• | Evaluating the models and assumptions for consistency with generally accepted actuarial methodologies and industry practice; |
• | Developing independent estimates for a selection of long-term care insurance liability for policy and contract claims using the Company’s assumptions and comparing our estimates to the recorded policy level claim liability; and |
• | Assessing the consistency of actual historical claims experience compared to the expected claims experience to evaluate the Company’s updated morbidity assumption. |
• | Developing independent estimates for a selection of contracts with additional benefit reserves for guarantees and comparing our estimates to the recorded reserves; |
• | Evaluating the Company’s mortality assumption and results by assessing the consistency of the mortality assumption with the underlying historical claims experience data and industry data; and |
• | Comparing expected claims experience that reflects the updated mortality assumption to historical claims experience to evaluate the updated mortality assumption. |
• | Assessing the Company’s reserving methodology and assumptions by comparing to accepted actuarial methodologies; |
• | Developing an independent estimate and range for the mortgage insurance reserve for a portion of the reserves, using the Company’s underlying historical claims and delinquency data and assessing the year-over-year movements of the Company’s recorded mortgage insurance reserves within the developed independent range; and |
• | Evaluating the reserve adjustments, assumption changes, and emerging experience including comparing prior period estimates to actual claims payments for the other portion of the reserves. |
2018 |
||||||||
Assets |
||||||||
Investments: |
||||||||
Fixed maturity securities available-for-sale, at fair value |
$ | i 60,339 |
$ | i 55,589 |
||||
Equity securities, at fair value |
i 239 |
i 275 |
||||||
Commercial mortgage loans ($ i 47 and $ i 62
are restricted as of December 31, 2019 and 2018, respectively, related to a securitization entity) |
i 6,963 |
i 6,749 |
||||||
Policy loans |
i 2,058 |
i 1,861 |
||||||
Other invested assets |
i 1,632 |
i 1,072 |
||||||
Total investments |
i 71,231 |
i 65,546 |
||||||
Cash, cash equivalents and restricted cash |
i 3,341 |
i 1,974 |
||||||
Accrued investment income |
i 654 |
i 645 |
||||||
Deferred acquisition costs |
i 1,836 |
i 3,142 |
||||||
Intangible assets and goodwill |
i 201 |
i 333 |
||||||
Reinsurance recoverable |
i 17,103 |
i 17,278 |
||||||
Other assets |
i 443 |
i 395 |
||||||
Deferred tax asset |
i 425 |
i 736 |
||||||
Separate account assets |
i 6,108 |
i 5,859 |
||||||
Assets held for sale related to discontinued operations |
— |
i 5,015 |
||||||
Total assets |
$ | i 101,342 |
$ | i 100,923 |
||||
Liabilities and equity |
||||||||
Liabilities: |
||||||||
Future policy benefits |
$ | i 40,384 |
$ | i 37,940 |
||||
Policyholder account balances |
i 22,217 |
i 22,968 |
||||||
Liability for policy and contract claims |
i 10,958 |
i 10,295 |
||||||
Unearned premiums |
i 1,893 |
i 2,013 |
||||||
Other liabilities |
i 1,562 |
i 1,529 |
||||||
Non-recourse funding obligations |
i 311 |
i 311 |
||||||
Long-term borrowings |
i 3,277 |
i 3,707 |
||||||
Separate account liabilities |
i 6,108 |
i 5,859 |
||||||
Liabilities held for sale related to discontinued operations |
— |
i 2,112 |
||||||
Total liabilities |
i 86,710 |
i 86,734 |
||||||
Commitments and contingencies |
i | i | ||||||
Equity: |
||||||||
Class A common stock, $ i i 0.001 /
par value; i i 1.5 / billion shares authorized; i 592
million and i 589 million shares issued as of December 31, 2019 and 2018, respectively; i 504
million and i 501 million shares outstanding as of December 31, 2019 and 2018, respectively |
i 1 |
i 1 |
||||||
Additional paid-in capital |
i 11,990 |
i 11,987 |
||||||
Accumulated other comprehensive income (loss): |
||||||||
Net unrealized investment gains (losses): |
||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
i 1,444 |
i 585 |
||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities |
i 12 |
i 10 |
||||||
Net unrealized investment gains (losses) |
i 1,456 |
i 595 |
||||||
Derivatives qualifying as hedges |
i 2,002 |
i 1,781 |
||||||
Foreign currency translation and other adjustments |
( i 25 |
) | ( i 332 |
) | ||||
Total accumulated other comprehensive income (loss) |
i 3,433 |
i 2,044 |
||||||
Retained earnings |
i 1,461 |
i 1,118 |
||||||
|
( i 2,700 |
) | ( i 2,700 |
) | ||||
Total Genworth Financial, Inc.’s stockholders’ equity |
i 14,185 |
i 12,450 |
||||||
Noncontrolling interests |
i 447 |
i 1,739 |
||||||
Total equity |
i 14,632 |
i 14,189 |
||||||
Total liabilities and equity |
$ |
i 101,342 |
$ |
i 100,923 |
||||
Years ended |
||||||||||||
2018 |
2017 |
|||||||||||
Revenues: |
||||||||||||
Premiums |
$ | i 4,037 |
$ | i 3,994 |
$ |
i 3,485 |
||||||
Net investment income |
i 3,220 |
i 3,121 |
i 3,066 |
|||||||||
Net investment gains (losses) |
i 50 |
( i 9 |
) | i 137 |
||||||||
Policy fees and other income |
i 789 |
i 795 |
i 825 |
|||||||||
Total revenues |
i 8,096 |
i 7,901 |
i 7,513 |
|||||||||
Benefits and expenses: |
||||||||||||
Benefits and other changes in policy reserves |
i 5,163 |
i 5,606 |
i 5,125 |
|||||||||
Interest credited |
i 577 |
i 611 |
i 646 |
|||||||||
Acquisition and operating expenses, net of deferrals |
i 962 |
i 943 |
i 957 |
|||||||||
Amortization of deferred acquisition costs and intangibles |
i 441 |
i 348 |
i 392 |
|||||||||
Interest expense |
i 239 |
i 256 |
i 266 |
|||||||||
Total benefits and expenses |
i 7,382 |
i 7,764 |
i 7,386 |
|||||||||
Income from continuing operations before income taxes |
i 714 |
i 137 |
i 127 |
|||||||||
Provision (benefit) for income taxes |
i 195 |
i 70 |
( i 406 |
) | ||||||||
Income from continuing operations |
i 519 |
i 67 |
i 533 |
|||||||||
Income from discontinued operations, net of taxes |
i 11 |
i 230 |
i 394 |
|||||||||
Net income |
i 530 |
i 297 |
i 927 |
|||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
i 64 |
i 70 |
( i 80 |
) | ||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i 123 |
i 108 |
i 190 |
|||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | i 343 |
$ | i 119 |
$ | i 817 |
||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ |
i 455 |
$ |
( i 3 |
) | $ |
i 613 |
|||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
( i 112 |
) | i 122 |
i 204 |
||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | i 343 |
$ | i 119 |
$ | i 817 |
||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||
Basic |
$ | i 0.90 |
$ | ( i 0.01 |
) | $ | i 1.23 |
|||||
Diluted |
$ | i 0.89 |
$ | ( i 0.01 |
) | $ | i 1.22 |
|||||
Net income available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||
Basic |
$ | i 0.68 |
$ | i 0.24 |
$ | i 1.64 |
||||||
Diluted |
$ | i 0.67 |
$ | i 0.24 |
$ | i 1.63 |
||||||
Weighted-average common shares outstanding: |
||||||||||||
Basic |
i 502.9 |
i 500.4 |
i 499.0 |
|||||||||
Diluted |
i 509.7 |
i 500.4 |
i 501.4 |
|||||||||
Supplemental disclosures: |
||||||||||||
Total other-than-temporary impairments |
$ | ( i 1 |
) | $ | i — |
$ | ( i 6 |
) | ||||
Portion of other-than-temporary impairments included in other comprehensive income (loss) |
i — |
i — |
i — |
|||||||||
Net other-than-temporary impairments |
( i 1 |
) | i — |
( i 6 |
) | |||||||
Other investment gains (losses) |
i 51 |
( i 9 |
) | i 143 |
||||||||
Total net investment gains (losses) |
$ | i 50 |
$ | ( i 9 |
) | $ | i 137 |
|||||
Years ended December 31, |
||||||||||||
2018 |
2017 |
|||||||||||
Net income |
$ | i 530 |
$ | i 297 |
$ | i 927 |
||||||
Other comprehensive income (loss), net of taxes: |
||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
i 846 |
( i 669 |
) | ( i 187 |
) | |||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities |
i 2 |
( i 2 |
) | i 1 |
||||||||
Derivatives qualifying as hedges |
i 221 |
( i 298 |
) | ( i 20 |
) | |||||||
Foreign currency translation and other adjustments |
i 487 |
( i 301 |
) | i 251 |
||||||||
Total other comprehensive income (loss) |
i 1,556 |
( i 1,270 |
) | i 45 |
||||||||
Total comprehensive income (loss) |
i 2,086 |
( i 973 |
) | i 972 |
||||||||
Less: comprehensive income attributable to noncontrolling interests |
i 354 |
i 22 |
i 222 |
|||||||||
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 1,732 |
$ | ( i 995 |
) | $ | i 750 |
|||||
Common stock |
Additional paid-in capital |
Accumulated other comprehensive income (loss) |
Retained earnings |
Treasury stock, at cost |
Total Genworth Financial, Inc.’s stockholders’ equity |
Noncontrolling interests |
Total equity |
|||||||||||||||||||||||||
Balances as of December 31, 2016 |
$ | i 1 |
$ | i 11,962 |
$ | i 3,094 |
$ | i 287 |
$ | ( i 2,700 |
) | $ | i 12,644 |
$ | i 1,823 |
$ | i 14,467 |
|||||||||||||||
Cumulative effect of change in accounting, net of taxes |
— |
— |
— |
i 9 |
— |
i 9 |
— |
i 9 |
||||||||||||||||||||||||
Repurchase of subsidiary shares |
— |
— |
— |
— |
— |
— |
( i 33 |
) | ( i 33 |
) | ||||||||||||||||||||||
Comprehensive income (loss): |
||||||||||||||||||||||||||||||||
Net income |
— |
— |
— |
i 817 |
— |
i 817 |
i 110 |
i 927 |
||||||||||||||||||||||||
Other comprehensive income (loss), net of taxes |
— |
— |
( i 67 |
) | — |
— |
( i 67 |
) | i 112 |
i 45 |
||||||||||||||||||||||
Total comprehensive income |
i 750 |
i 222 |
i 972 |
|||||||||||||||||||||||||||||
Dividends to noncontrolling interests |
— |
— |
— |
— |
— |
— |
( i 107 |
) | ( i 107 |
) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other |
— |
i 15 |
— |
— |
— |
i 15 |
i 5 |
i 20 |
||||||||||||||||||||||||
Balances as of December 31, 2017 |
i 1 |
i 11,977 |
i 3,027 |
i 1,113 |
( i 2,700 |
) | i 13,418 |
i 1,910 |
i 15,328 |
|||||||||||||||||||||||
Cumulative effect of change in accounting, net of taxes |
— |
— |
i 131 |
( i 114 |
) | — |
i 17 |
— |
i 17 |
|||||||||||||||||||||||
Repurchase of subsidiary shares |
— |
— |
— |
— |
— |
— |
( i 105 |
) | ( i 105 |
) | ||||||||||||||||||||||
Comprehensive income (loss): |
||||||||||||||||||||||||||||||||
Net income |
— |
— |
— |
i 119 |
— |
i 119 |
i 178 |
i 297 |
||||||||||||||||||||||||
Other comprehensive loss, net of taxes |
— |
— |
( i 1,114 |
) | — |
— |
( i 1,114 |
) | ( i 156 |
) | ( i 1,270 |
) | ||||||||||||||||||||
Total comprehensive income (loss) |
( i 995 |
) | i 22 |
( i 973 |
) | |||||||||||||||||||||||||||
Dividends to noncontrolling interests |
— |
— |
— |
— |
— |
— |
( i 97 |
) | ( i 97 |
) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other |
— |
i 10 |
— |
— |
— |
i 10 |
i 9 |
i 19 |
||||||||||||||||||||||||
Balances as of December 31, 2018 |
i 1 |
i 11,987 |
i 2,044 |
i 1,118 |
( i 2,700 |
) | i 12,450 |
i 1,739 |
i 14,189 |
|||||||||||||||||||||||
Repurchase of subsidiary shares |
— |
— |
— |
— |
— |
— |
( i 44 |
) | ( i 44 |
) | ||||||||||||||||||||||
Sale of business that included |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
noncontrolling interests |
|
|
— | |
|
|
— | |
|
|
— | |
|
|
— | |
|
|
— | |
|
|
— | |
|
|
( i 1,417 |
) |
|
|
( i 1,417 |
) |
Comprehensive income: |
||||||||||||||||||||||||||||||||
Net income |
— |
— |
— |
i 343 |
— |
i 343 |
i 187 |
i 530 |
||||||||||||||||||||||||
Other comprehensive income, net of taxes |
— |
— |
i 1,389 |
— |
— |
i 1,389 |
i 167 |
i 1,556 |
||||||||||||||||||||||||
Total comprehensive income |
|
|
|
|
|
i 1,732 |
i 354 |
i 2,086 |
||||||||||||||||||||||||
Dividends to noncontrolling interests |
— |
— |
— |
— |
— |
— |
( i 197 |
) | ( i 197 |
) | ||||||||||||||||||||||
Stock-based compensation expense and exercises and other |
— |
i 3 |
— |
— |
— |
i 3 |
i 12 |
i 15 |
||||||||||||||||||||||||
Balances as of December 31, 2019 |
$ | i 1 |
$ | i 11,990 |
$ | i 3,433 |
$ | i 1,461 |
$ | ( i 2,700 |
) | $ | i 14,185 |
$ | i 447 |
$ | i 14,632 |
|||||||||||||||
Years ended December 31, |
||||||||||||
2018 |
2017 |
|||||||||||
Cash flows from operating activities: |
||||||||||||
Net income |
$ | i 530 |
$ | i 297 |
$ | i 927 |
||||||
Less income from discontinued operations, net of taxes |
( i 11 |
) | ( i 230 |
) | ( i 394 |
) | ||||||
Adjustments to reconcile net income to net cash from operating activities: |
||||||||||||
Amortization of fixed maturity securities discounts and premiums |
( i 118 |
) | ( i 130 |
) | ( i 156 |
) | ||||||
Net investment (gains) losses |
( i 50 |
) | i 9 |
( i 137 |
) | |||||||
Charges assessed to policyholders |
( i 699 |
) | ( i 697 |
) | ( i 713 |
) | ||||||
Acquisition costs deferred |
( i 27 |
) | ( i 42 |
) | ( i 46 |
) | ||||||
Amortization of deferred acquisition costs and intangibles |
i 441 |
i 348 |
i 392 |
|||||||||
Deferred income taxes |
i 139 |
i 28 |
( i 427 |
) | ||||||||
Trading securities, derivative instruments and limi ted partnerships |
( i 98 |
) | ( i 260 |
) | i 727 |
|||||||
Stock-based compensation expense |
i 27 |
i 35 |
i 31 |
|||||||||
Change in certain assets and liabilities: |
||||||||||||
Accrued investment income and other assets |
( i 358 |
) | ( i 166 |
) | i 32 |
|||||||
Insurance reserves |
i 1,259 |
i 1,555 |
i 1,625 |
|||||||||
Current tax liabilities |
i 26 |
i 8 |
( i 25 |
) | ||||||||
Other liabilities, policy and contract claims and other policy-related balances |
i 609 |
i 598 |
i 370 |
|||||||||
Cash from operating activities—discontinued operations |
i 409 |
i 280 |
i 348 |
|||||||||
Net cash from operating activities |
i 2,079 |
i 1,633 |
i 2,554 |
|||||||||
Cash flows from (used by) investing activities: |
||||||||||||
Proceeds from maturities and repayments of investments: |
||||||||||||
Fixed maturity securities |
i 3,436 |
i 3,312 |
i 4,170 |
|||||||||
Commercial mortgage loans |
i 582 |
i 701 |
i 579 |
|||||||||
Restricted commercial mortgage loans related to a securitization entity |
i 15 |
i 45 |
i 22 |
|||||||||
Proceeds from sales of investments: |
||||||||||||
Fixed maturity and equity securities |
i 3,883 |
i 5,488 |
i 3,788 |
|||||||||
Purchases and originations of investments: |
||||||||||||
Fixed maturity and equity securities |
( i 6,899 |
) | ( i 9,386 |
) | ( i 7,800 |
) | ||||||
Commercial mortgage loans |
( i 813 |
) | ( i 1,047 |
) | ( i 806 |
) | ||||||
Other invested assets, net |
( i 389 |
) | i 261 |
( i 678 |
) | |||||||
Policy loans, net |
i 62 |
i 35 |
i 48 |
|||||||||
Proceeds from sale of business, net of cash transferred |
i 1,398 |
i — |
i — |
|||||||||
Payments for business purchased, net of cash acquired |
i — |
i — |
( i 5 |
) | ||||||||
Cash from ( used by) investing activities—discontinued operations |
i 26 |
( i 31 |
) |
( i 77 |
) | |||||||
Net cash from ( used by) investing activities |
i 1,301 |
( i 622 |
) |
( i 759 |
) | |||||||
Cash flows |
||||||||||||
Deposits to universal life and investment contracts |
i 824 |
i 1,193 |
i 857 |
|||||||||
Withdrawals from universal life and investment contracts |
( i 2,319 |
) | ( i 2,355 |
) | ( i 2,397 |
) | ||||||
Proceeds from issuance of long-term debt |
i — |
i 441 |
i — |
|||||||||
Repayment and repurchase of long-term debt |
( i 446 |
) | ( i 600 |
) | i — |
|||||||
Repayment of borrowings related to securitization entities |
i — |
( i 40 |
) | ( i 34 |
) | |||||||
Repurchase of subsidiary shares |
( i 22 |
) | ( i 55 |
) | ( i 19 |
) | ||||||
Dividends paid to noncontrolling interests |
( i 87 |
) | ( i 40 |
) | ( i 53 |
) | ||||||
Other, net |
( i 35 |
) | ( i 56 |
) | ( i 53 |
) | ||||||
Cash used by financing activities—discontinued operations |
( i 132 |
) | ( i 109 |
) | ( i 69 |
) | ||||||
Net cash used by financing activities |
( i 2,217 |
) | ( i 1,621 |
) | ( i 1,768 |
) | ||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash (includes $ i 6, $( i 25)
and $ i 23 related to discontinued operations) |
i 1 |
( i 88 |
) | i 64 |
||||||||
Net change in cash, cash equivalents and restricted cash |
i 1,164 |
( i 698 |
) | i 91 |
||||||||
Cash, cash equivalents and restricted cash at beginning of period |
i 2,177 |
i 2,875 |
i 2,784 |
|||||||||
Cash, cash equivalents and restricted cash at end of period |
i 3,341 |
i 2,177 |
i 2,875 |
|||||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period |
i — |
i 203 |
i 229 |
|||||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period |
$ | i 3,341 |
$ | i 1,974 |
$ | i 2,646 |
||||||
• | U.S. Mortgage Insurance. |
• | Australia Mortgage Insurance. |
• | U.S. Life Insurance. |
• |
Runoff. |
• | we do not expect full recovery of our amortized cost basis when due, |
• | the present value of cash flows expected to be collected is less than our amortized cost basis, |
• | we intend to sell a security or |
• | it is more likely than not that we will be required to sell a security prior to recovery. |
• | Level 1—Quoted prices for identical instruments in active markets. |
• | Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. |
• | Level 3—Instruments whose significant value drivers are unobservable. |
Accumulated other comprehensive income (loss) |
||||||||||||||||||||
(Amounts in millions) |
Net unrealized investment gains (losses) |
Derivatives qualifying as hedges |
Foreign currency translation and other adjustments |
Retained earnings |
Total stockholders’ equity |
|||||||||||||||
Deferred taxes: |
||||||||||||||||||||
Net unrealized gains on investment securities |
$ | i 192 |
$ | i — |
$ | i — |
$ | ( i 192 |
) | $ | i — |
|||||||||
Net unrealized gains on derivatives |
i — |
i 12 |
i — |
( i 12 |
) | i — |
||||||||||||||
Investment in foreign subsidiaries |
( i 3 |
) | i — |
( i 46 |
) | i 49 |
i — |
|||||||||||||
Accrued commission and general expenses |
i — |
i — |
( i 1 |
) | i 1 |
i — |
||||||||||||||
Cumulative effect of changes in accounting |
$ | i 189 |
$ | i 12 |
$ | ( i 47 |
) | $ | ( i 154 |
) | $ | i — |
||||||||
• |
assumptions will no longer be locked-in at contract inception and all cash flow assumptions used to estimate the liability for future policy benefits (except the discount rate) will be reviewed at least annually in the same period each year or more frequently if actual experience indicates a change is required. Changes will be recorded in net income (loss) using a retrospective approach with a cumulative catch-up adjustment by recalculating the net premium ratio (which will be capped at 100%) using actual historical and updated future cash flow assumptions; |
• |
the discount rate used to determine the liability for future policy benefits will be a current upper-medium grade (low credit risk) fixed-income instrument yield, which is generally interpreted to mean a single-A rated bond rate for the same duration, and is required to be reviewed quarterly, with changes in the discount rate recorded in other comprehensive income (loss); |
• |
the provision for adverse deviation and the premium deficiency test will be eliminated; |
• |
market risk benefits associated with deposit-type contracts will be measured at fair value with changes related to instrument-specific credit risk recorded in other comprehensive income (loss) and remaining changes recorded in net income (loss); |
• |
the amortization method for DAC will generally be on a straight-line basis over the expected contract term; and |
• |
disclosures will be greatly expanded to include significant assumptions and product liability rollforwards. |
(Amounts in millions, except per share amounts) |
2019 |
2018 |
2017 |
|||||||||
Weighted-average common shares used in basic earnings (loss) per share calculations |
i 502.9 |
i 500.4 |
i 499.0 |
|||||||||
Potentially dilutive securities: |
||||||||||||
Stock options, restricted stock units and stock appreciation rights |
i 6.8 |
— |
i 2.4 |
|||||||||
Weighted-average common shares used in diluted earnings (loss) per share calculations (1) |
i 509.7 |
i 500.4 |
i 501.4 |
|||||||||
Income (loss) from continuing operations: |
||||||||||||
Income from continuing operations |
$ |
i 519 |
$ |
i 67 |
$ |
i 533 |
||||||
Less: net income (loss) from continuing operations attributable to noncontrolling interests |
i 64 |
i 70 |
( i 80 |
) | ||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s |
$ |
i 455 |
$ |
( i 3 |
) |
$ |
i 613 |
|||||
Basic per share |
$ |
i 0.90 |
$ |
( i 0.01 |
) |
$ |
i 1.23 |
|||||
Diluted per share |
$ |
i 0.89 |
$ |
( i 0.01 |
) |
$ |
i 1.22 |
|||||
Income (loss) from discontinued operations: |
||||||||||||
Income from discontinued operations, net of taxes |
$ |
i 11 |
$ |
i 230 |
$ |
i 394 |
||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i 123 |
i 108 |
i 190 |
|||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
$ |
( i 112 |
) |
$ |
i 122 |
$ |
i 204 |
|||||
Basic per share |
$ |
( i 0.22 |
) |
$ |
i 0.24 |
$ |
i 0.41 |
|||||
Diluted per share |
$ |
( i 0.22 |
) |
$ |
i 0.24 |
$ |
i 0.41 |
|||||
Net income: |
||||||||||||
Income from continuing operations |
$ |
i 519 |
$ |
i 67 |
$ |
i 533 |
||||||
Income from discontinued operations, net of taxes |
i 11 |
i 230 |
i 394 |
|||||||||
Net income |
i 530 |
i 297 |
i 927 |
|||||||||
Less: net income attributable to noncontrolling interests |
i 187 |
i 178 |
i 110 |
|||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ |
i 343 |
$ |
i 119 |
$ |
i 817 |
||||||
Basic per share (2) |
$ |
i 0.68 |
$ |
i 0.24 |
$ |
i 1.64 |
||||||
Diluted per share (2) |
$ |
i 0.67 |
$ |
i 0.24 |
$ |
i 1.63 |
||||||
(1) |
Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of our loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the year ended December 31, 2018, we were required to use basic weighted-average common shares outstanding as the inclusion of shares for stock options, restricted stock units (“RSUs”) and stock appreciation rights (“SARs”) of i 3.8
million would have been antidilutive to the calculation. If we had not incurred a loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the year ended December 31, 2018, dilutive potential weighted-average common shares outstanding would have been i 504.2 million. |
(2) |
May not total due to whole number calculation. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Fixed maturity securities—taxable |
$ | i 2,494 |
$ | i 2,456 |
$ | i 2,458 |
||||||
Fixed maturity securities—non-taxable |
i 8 |
i 11 |
i 12 |
|||||||||
Equity securities |
i 16 |
i 20 |
i 19 |
|||||||||
Commercial mortgage loans |
i 344 |
i 320 |
i 306 |
|||||||||
Restricted commercial mortgage loans related to a securitization entity (1) |
i 4 |
i 7 |
i 9 |
|||||||||
Policy loans |
i 180 |
i 169 |
i 153 |
|||||||||
Other invested assets (2) |
i 234 |
i 181 |
i 157 |
|||||||||
Restricted other invested assets related to securitization entities (1) |
i — |
i — |
i 1 |
|||||||||
Cash, cash equivalents , restricted cash and short-term investments |
i 39 |
i 48 |
i 35 |
|||||||||
Gross investment income before expenses and fees |
i 3,319 |
i 3,212 |
i 3,150 |
|||||||||
Expenses and fees |
( i 99 |
) | ( i 91 |
) | ( i 84 |
) | ||||||
Net investment income |
$ | i 3,220 |
$ | i 3,121 |
$ | i 3,066 |
||||||
(1) |
See note 17 for additional information related to consolidated securitization entities. |
(2) |
Included in other invested assets was $ i 2 million of net investment income related to trading securities for the year ended December 31, 2017. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Available-for-sale securities: |
||||||||||||
Realized gains |
$ | i 107 |
$ | i 162 |
$ | i 205 |
||||||
Realized losses |
( i 39 |
) | ( i 137 |
) | ( i 64 |
) | ||||||
Net realized gains (losses) on available-for-sale securities |
i 68 |
i 25 |
i 141 |
|||||||||
Impairments: |
||||||||||||
Total other-than-temporary impairments |
( i 1 |
) | i — |
( i 6 |
) | |||||||
Portion of other-than-temporary impairments included in other |
i — |
i — |
i — |
|||||||||
Net other-than-temporary impairments |
( i 1 |
) | i — |
( i 6 |
) | |||||||
Net realized gains (losses) on equity securities sold |
i 9 |
i 11 |
i — |
|||||||||
Net unrealized gains (losses) on equity securities still held |
i 14 |
( i 34 |
) | i — |
||||||||
Trading securities |
i — |
i — |
i 1 |
|||||||||
Limited partnerships |
i 29 |
i 11 |
i — |
|||||||||
Commercial mortgage loans |
( i 2 |
) | i — |
i 3 |
||||||||
Net gains (losses) related to securitization entities (1) |
i — |
i — |
i 7 |
|||||||||
Derivative instruments (2) |
( i 72 |
) | ( i 22 |
) | ( i 9 |
) | ||||||
Other |
i 5 |
i — |
i — |
|||||||||
Net investment gains (losses) |
$ | i 50 |
$ | ( i 9 |
) | $ | i 137 |
|||||
(1) |
See note 17 for additional information related to consolidated securitization entities. |
(2) |
See note 5 for additional information on the impact of derivative instruments included in net investment gains (losses). |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Beginning balance |
$ | i 24 |
$ | i 32 |
$ | i 42 |
||||||
Reductions: |
||||||||||||
Securities sold, paid down or disposed |
( i 2 |
) | ( i 8 |
) | ( i 10 |
) | ||||||
Ending balance |
$ | i 22 |
$ | i 24 |
$ | i 32 |
||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Net unrealized gains (losses) on investment securities: |
||||||||||||
Fixed maturity securities |
$ | i 6,676 |
$ | i 1,775 |
$ | i 5,125 |
||||||
Equity securities |
i — |
i — |
i 69 |
|||||||||
Subtotal (1) |
i 6,676 |
i 1,775 |
i 5,194 |
|||||||||
Adjustments to DAC, PVFP, sales inducements and benefit reserves |
( i 4,789 |
) | ( i 952 |
) | ( i 3,451 |
) | ||||||
Income taxes, net |
( i 406 |
) | ( i 190 |
) | ( i 583 |
) | ||||||
Net unrealized investment gains (losses) |
i 1,481 |
i 633 |
i 1,160 |
|||||||||
Less: net unrealized investment gains (losses) attributable to noncontrolling interests |
i 25 |
i 38 |
i 75 |
|||||||||
Net unrealized investment gains (losses) attributable to Genworth Financial, Inc. |
$ | i 1,456 |
$ | i 595 |
$ | i 1,085 |
||||||
(1) |
Excludes foreign exchange. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Beginning balance |
$ | i 595 |
$ | i 1,085 |
$ | i 1,262 |
||||||
Cumulative effect of changes in accounting: |
||||||||||||
Stranded tax effects |
i — |
i 189 |
i — |
|||||||||
Recognition and measurement of financial assets and liabilities, net of taxes of $ i — , $ i 18
and $ i — |
i — |
( i 25 |
) | i — |
||||||||
Total cumulative effect of changes in accounting |
i — |
i 164 |
i — |
|||||||||
Unrealized gains (losses) arising during the period: |
||||||||||||
Unrealized gains (losses) on investment securities |
i 4,980 |
( i 3,327 |
) | i 1,683 |
||||||||
Adjustment to DAC (1) |
( i 956 |
) | i 1,182 |
( i 1,000 |
) | |||||||
Adjustment to PVFP |
( i 49 |
) | i 69 |
( i 33 |
) | |||||||
Adjustment to sales inducements |
( i 32 |
) | i 34 |
( i 4 |
) | |||||||
|
( i 2,800 |
) | i 1,208 |
( i 803 |
) | |||||||
Provision for income taxes |
( i 233 |
) | i 181 |
i 73 |
||||||||
Change in unrealized gains (losses) on investment securities |
i 910 |
( i 653 |
) | ( i 84 |
) | |||||||
Reclassification adjustments to net investment (gains) losses, net of taxes of $ i 17 , $ i 5
and $ i 55 |
( i 62 |
) | ( i 18 |
) | ( i 102 |
) | ||||||
Change in net unrealized investment gains (losses) |
i 848 |
( i 671 |
) | ( i 186 |
) | |||||||
Less: change in net unrealized investment gains (losses) attributable to noncontrolling interests |
( i 13 |
) | ( i 17 |
) | ( i 9 |
) | ||||||
Ending balance |
$ | i 1,456 |
$ | i 595 |
$ | i 1,085 |
||||||
(1) |
See note 6 for additional information. |
(2) |
See note 9 for additional information. |
Gross unrealized gains |
Gross unrealized losses |
|||||||||||||||||||||||
(Amounts in millions) |
Amortized cost or cost |
Not other-than- temporarily impaired |
Other-than- temporarily impaired |
Not other-than- temporarily impaired |
Other-than- temporarily impaired |
Fair value |
||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises |
$ | i 4,073 |
$ | i 952 |
$ | i — |
$ | i — |
$ | i — |
$ | i 5,025 |
||||||||||||
State and political subdivisions |
i 2,394 |
i 355 |
i — |
( i 2 |
) | i — |
i 2,747 |
|||||||||||||||||
Non-U.S. government |
i 1,235 |
i 117 |
i — |
( i 2 |
) | i — |
i 1,350 |
|||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||
Utilities |
i 4,322 |
i 675 |
i — |
i — |
i — |
i 4,997 |
||||||||||||||||||
Energy |
i 2,404 |
i 303 |
i — |
( i 8 |
) | i — |
i 2,699 |
|||||||||||||||||
Finance and insurance |
i 6,977 |
i 798 |
i — |
( i 1 |
) | i — |
i 7,774 |
|||||||||||||||||
Consumer—non-cyclical |
i 4,909 |
i 796 |
i — |
( i 4 |
) | i — |
i 5,701 |
|||||||||||||||||
Technology and communications |
i 2,883 |
i 363 |
i — |
( i 1 |
) | i — |
i 3,245 |
|||||||||||||||||
Industrial |
i 1,271 |
i 125 |
i — |
i — |
i — |
i 1,396 |
||||||||||||||||||
Capital goods |
i 2,345 |
i 367 |
i — |
( i 1 |
) | i — |
i 2,711 |
|||||||||||||||||
Consumer—cyclical |
i 1,590 |
i 172 |
i — |
( i 2 |
) | i — |
i 1,760 |
|||||||||||||||||
Transportation |
i 1,320 |
i 187 |
i — |
( i 1 |
) | i — |
i 1,506 |
|||||||||||||||||
Other |
i 292 |
i 30 |
i — |
i — |
i — |
i 322 |
||||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Total U.S. corporate |
i 28,313 |
i 3,816 |
i — |
( i 18 |
) | i — |
i 32,111 |
|||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||
Utilities |
i 779 |
i 50 |
i — |
i — |
i — |
i 829 |
||||||||||||||||||
Energy |
i 1,140 |
i 179 |
i — |
i — |
i — |
i 1,319 |
||||||||||||||||||
Finance and insurance |
i 2,087 |
i 232 |
i — |
i — |
i — |
i 2,319 |
||||||||||||||||||
Consumer—non-cyclical |
i 631 |
i 55 |
i — |
( i 2 |
) | i — |
i 684 |
|||||||||||||||||
Technology and communications |
i 1,010 |
i 128 |
i — |
i — |
i — |
i 1,138 |
||||||||||||||||||
Industrial |
i 896 |
i 92 |
i — |
i — |
i — |
i 988 |
||||||||||||||||||
Capital goods |
i 565 |
i 40 |
i — |
i — |
i — |
i 605 |
||||||||||||||||||
Consumer—cyclical |
i 373 |
i 24 |
i — |
i — |
i — |
i 397 |
||||||||||||||||||
Transportation |
i 557 |
i 73 |
i — |
( i 1 |
) | i — |
i 629 |
|||||||||||||||||
Other |
i 1,431 |
i 188 |
i — |
( i 2 |
) | i — |
i 1,617 |
|||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Total non-U.S. corporate |
i 9,469 |
i 1,061 |
i — |
( i 5 |
) | i — |
i 10,525 |
|||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Residential mortgage-backed |
i 2,057 |
i 199 |
i 15 |
( i 1 |
) | i — |
i 2,270 |
|||||||||||||||||
Commercial mortgage-backed |
i 2,897 |
i 137 |
i — |
( i 8 |
) | i — |
i 3,026 |
|||||||||||||||||
Other asset-backed |
i 3,262 |
i 30 |
i — |
( i 7 |
) | i — |
i 3,285 |
|||||||||||||||||
|
|
|
|
|
||||||||||||||||||||
Total available-for-sale fixed maturity securities |
$ | i 53,700 |
$ | i 6,667 |
$ | i 15 |
$ | ( i 43 |
) | $ | i — |
$ | i 60,339 |
|||||||||||
Gross unrealized gains |
Gross unrealized losses |
|||||||||||||||||||||||
(Amounts in millions) |
Amortized cost or cost |
Not other-than- temporarily impaired |
Other- than- temporarily impaired |
Not other-than- temporarily impaired |
Other- than- temporarily impaired |
Fair value |
||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises |
$ | i 4,175 |
$ | i 473 |
$ | i — |
$ | ( i 17 |
) | $ | i — |
$ | i 4,631 |
|||||||||||
State and political subdivisions |
i 2,406 |
i 168 |
i — |
( i 22 |
) | i — |
i 2,552 |
|||||||||||||||||
Non-U.S. government |
i 1,232 |
i 44 |
i — |
( i 8 |
) | i — |
i 1,268 |
|||||||||||||||||
U.S. corporate: |
|
|
||||||||||||||||||||||
Utilities |
i 4,439 |
i 331 |
i — |
( i 95 |
) | i — |
i 4,675 |
|||||||||||||||||
Energy |
i 2,375 |
i 101 |
i — |
( i 64 |
) | i — |
i 2,412 |
|||||||||||||||||
Finance and insurance |
i 6,691 |
i 249 |
i — |
( i 132 |
) | i — |
i 6,808 |
|||||||||||||||||
Consumer—non-cyclical |
i 4,879 |
i 294 |
i — |
( i 137 |
) | i — |
i 5,036 |
|||||||||||||||||
Technology and communications |
i 2,809 |
i 110 |
i — |
( i 78 |
) | i — |
i 2,841 |
|||||||||||||||||
Industrial |
i 1,213 |
i 41 |
i — |
( i 33 |
) | i — |
i 1,221 |
|||||||||||||||||
Capital goods |
i 2,277 |
i 165 |
i — |
( i 51 |
) | i — |
i 2,391 |
|||||||||||||||||
Consumer—cyclical |
i 1,592 |
i 53 |
i — |
( i 48 |
) | i — |
i 1,597 |
|||||||||||||||||
Transportation |
i 1,283 |
i 78 |
i — |
( i 41 |
) | i — |
i 1,320 |
|||||||||||||||||
Other |
i 376 |
i 24 |
i — |
( i 3 |
) | i — |
i 397 |
|||||||||||||||||
Total U.S. corporate |
i 27,934 |
i 1,446 |
i — |
( i 682 |
) | i — |
i 28,698 |
|||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||
Utilities |
i 838 |
i 12 |
i — |
( i 29 |
) | i — |
i 821 |
|||||||||||||||||
Energy |
i 1,170 |
i 71 |
i — |
( i 20 |
) | i — |
i 1,221 |
|||||||||||||||||
Finance and insurance |
i 2,071 |
i 71 |
i — |
( i 36 |
) | i — |
i 2,106 |
|||||||||||||||||
Consumer—non-cyclical |
i 706 |
i 8 |
i — |
( i 24 |
) | i — |
i 690 |
|||||||||||||||||
Technology and communications |
i 1,043 |
i 21 |
i — |
( i 24 |
) | i — |
i 1,040 |
|||||||||||||||||
Industrial |
i 896 |
i 36 |
i — |
( i 16 |
) | i — |
i 916 |
|||||||||||||||||
Capital goods |
i 571 |
i 10 |
i — |
( i 9 |
) | i — |
i 572 |
|||||||||||||||||
Consumer—cyclical |
i 322 |
i 1 |
i — |
( i 10 |
) | i — |
i 313 |
|||||||||||||||||
Transportation |
i 580 |
i 44 |
i — |
( i 14 |
) | i — |
i 610 |
|||||||||||||||||
Other |
i 1,414 |
i 85 |
i — |
( i 18 |
) | i — |
i 1,481 |
|||||||||||||||||
Total non-U.S. corporate |
i 9,611 |
i 359 |
i — |
( i 200 |
) | i — |
i 9,770 |
|||||||||||||||||
Residential mortgage-backed |
i 2,460 |
i 159 |
i 13 |
( i 14 |
) | i — |
i 2,618 |
|||||||||||||||||
Commercial mortgage-backed |
i 3,054 |
i 43 |
i — |
( i 81 |
) | i — |
i 3,016 |
|||||||||||||||||
Other asset-backed |
i 3,048 |
i 10 |
i 1 |
( i 23 |
) | i — |
i 3,036 |
|||||||||||||||||
Total available-for-sale fixed maturity securities |
$ | i 53,920 |
$ | i 2,702 |
$ | i 14 |
$ | ( i 1,047 |
) | $ | i — |
$ | i 55,589 |
|||||||||||
Less than 12 months |
12 months or more |
Total |
||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
|||||||||||||||||||||||||||
Description of Securities |
||||||||||||||||||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||||||||||||||
State and political subdivisions |
$ |
i 91 |
$ |
( i 2 |
) | i 14 |
$ |
i — |
$ |
i — |
i — |
$ |
i 91 |
$ |
( i 2 |
) | i 14 |
|||||||||||||||||||
Non-U.S. government |
i 224 |
( i 2 |
) | i 20 |
i — |
i — |
i — |
i 224 |
( i 2 |
) | i 20 |
|||||||||||||||||||||||||
U.S. corporate |
i 123 |
( i 5 |
) | i 27 |
i 302 |
( i 13 |
) | i 33 |
i 425 |
( i 18 |
) | i 60 |
||||||||||||||||||||||||
Non-U.S. corporate |
i 79 |
( i 1 |
) | i 12 |
i 62 |
( i 4 |
) | i 7 |
i 141 |
( i 5 |
) | i 19 |
||||||||||||||||||||||||
Residential mortgage-backed |
i 22 |
( i 1 |
) | i 10 |
i — |
i — |
i — |
i 22 |
( i 1 |
) | i 10 |
|||||||||||||||||||||||||
Commercial mortgage-backed |
i 381 |
( i 5 |
) | i 51 |
i 14 |
( i 3 |
) | i 3 |
i 395 |
( i 8 |
) | i 54 |
||||||||||||||||||||||||
Other asset-backed |
i 532 |
( i 2 |
) | i 97 |
i 439 |
( i 5 |
) | i 115 |
i 971 |
( i 7 |
) | i 212 |
||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position |
$ | i 1,452 |
$ | ( i 18 |
) | i 231 |
$ | i 817 |
$ | ( i 25 |
) | i 158 |
$ | i 2,269 |
$ | ( i 43 |
) | i 389 |
||||||||||||||||||
% Below cost: |
||||||||||||||||||||||||||||||||||||
<20% Below cost |
$ | i 1,452 |
$ | ( i 18 |
) | i 231 |
$ | i 807 |
$ | ( i 20 |
) | i 155 |
$ | i 2,259 |
$ | ( i 38 |
) | i 386 |
||||||||||||||||||
20%-50% Below cost |
i — |
i — |
i — |
i 10 |
( i 5 |
) | i 3 |
i 10 |
( i 5 |
) | i 3 |
|||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position |
$ | i 1,452 |
$ | ( i 18 |
) | i 231 |
$ | i 817 |
$ | ( i 25 |
) | i 158 |
$ | i 2,269 |
$ | ( i 43 |
) | i 389 |
||||||||||||||||||
Investment grade |
$ | i 1,408 |
$ | ( i 14 |
) | i 223 |
$ | i 702 |
$ | ( i 15 |
) | i 145 |
$ | i 2,110 |
$ | ( i 29 |
) | i 368 |
||||||||||||||||||
Below investment grade |
i 44 |
( i 4 |
) | i 8 |
i 115 |
( i 10 |
) | i 13 |
i 159 |
( i 14 |
) | i 21 |
||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position |
$ | i 1,452 |
$ | ( i 18 |
) | i 231 |
$ | i 817 |
$ | ( i 25 |
) | i 158 |
$ | i 2,269 |
$ | ( i 43 |
) | i 389 |
||||||||||||||||||
Less than 12 months |
12 months or more |
Total |
||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
|||||||||||||||||||||||||||
Description of Securities |
||||||||||||||||||||||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||||||||||||||
Energy |
$ |
i 54 |
$ |
( i 3 |
) | i 10 |
$ |
i 80 |
$ |
( i 5 |
) | i 10 |
$ |
i 134 |
$ |
( i 8 |
) | i 20 |
||||||||||||||||||
Finance and insurance |
i — |
i — |
i — |
i 34 |
( i 1 |
) | i 4 |
i 34 |
( i 1 |
) | i 4 |
|||||||||||||||||||||||||
Consumer—non-cyclical |
i 34 |
( i 1 |
) | i 9 |
i 93 |
( i 3 |
) | i 9 |
i 127 |
( i 4 |
) | i 18 |
||||||||||||||||||||||||
Technology and communications |
i — |
i — |
i — |
i 18 |
( i 1 |
) | i 2 |
i 18 |
( i 1 |
) | i 2 |
|||||||||||||||||||||||||
Capital goods |
i 35 |
( i 1 |
) | i 8 |
i — |
i — |
i — |
i 35 |
( i 1 |
) | i 8 |
|||||||||||||||||||||||||
Consumer—cyclical |
i — |
i — |
i — |
i 54 |
( i 2 |
) | i 6 |
i 54 |
( i 2 |
) | i 6 |
|||||||||||||||||||||||||
Transportation |
i — |
i — |
i — |
i 23 |
( i 1 |
) | i 2 |
i 23 |
( i 1 |
) | i 2 |
|||||||||||||||||||||||||
Subtotal, U.S. corporate securities |
i 123 |
( i 5 |
) | i 27 |
i 302 |
( i 13 |
) | i 33 |
i 425 |
( i 18 |
) | i 60 |
||||||||||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||||||||||||||
Consumer—non-cyclical |
i — |
i — |
i — |
i 31 |
( i 2 |
) | i 3 |
i 31 |
( i 2 |
) | i 3 |
|||||||||||||||||||||||||
Transportation |
i — |
i — |
i — |
i 25 |
( i 1 |
) | i 3 |
i 25 |
( i 1 |
) | i 3 |
|||||||||||||||||||||||||
Other |
i 79 |
( i 1 |
) | i 12 |
i 6 |
( i 1 |
) | i 1 |
i 85 |
( i 2 |
) | i 13 |
||||||||||||||||||||||||
Subtotal, non-U.S. corporatesecurities |
i 79 |
( i 1 |
) | i 12 |
i 62 |
( i 4 |
) | i 7 |
i 141 |
( i 5 |
) | i 19 |
||||||||||||||||||||||||
Total for corporate securities in an unrealized loss position |
$ | i 202 |
$ | ( i 6 |
) | i 39 |
$ | i 364 |
$ | ( i 17 |
) | i 40 |
$ | i 566 |
$ | ( i 23 |
) | i 79 |
||||||||||||||||||
Less than 12 months |
12 months or more |
Total |
||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
|||||||||||||||||||||||||||
Description of Securities |
||||||||||||||||||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||||||||||||||
U.S. government, agencies and government-sponsored enterprises |
$ | i 545 |
$ | ( i 8 |
) | i 17 |
$ | i 161 |
$ | ( i 9 |
) | i 26 |
$ | i 706 |
$ | ( i 17 |
) |
i 43 |
||||||||||||||||||
State and political subdivisions |
i 371 |
( i 10 |
) | i 63 |
i 233 |
( i 12 |
) |
i 57 |
i 604 |
( i 22 |
) |
i 120 |
||||||||||||||||||||||||
Non-U.S. government |
i 177 |
( i 6 |
) | i 26 |
i 119 |
( i 2 |
) |
i 18 |
i 296 |
( i 8 |
) |
i 44 |
||||||||||||||||||||||||
U.S. corporate |
i 9,956 |
( i 472 |
) | i 1,338 |
i 2,440 |
( i 210 |
) |
i 363 |
i 12,396 |
( i 682 |
) |
i 1,701 |
||||||||||||||||||||||||
Non-U.S. corporate |
i 3,684 |
( i 142 |
) | i 502 |
i 664 |
( i 58 |
) |
i 96 |
i 4,348 |
( i 200 |
) |
i 598 |
||||||||||||||||||||||||
Residential mortgage-backed |
i 334 |
( i 6 |
) | i 52 |
i 303 |
( i 8 |
) |
i 70 |
i 637 |
( i 14 |
) |
i 122 |
||||||||||||||||||||||||
Commercial mortgage-backed |
i 758 |
( i 19 |
) | i 115 |
i 870 |
( i 62 |
) |
i 130 |
i 1,628 |
( i 81 |
) |
i 245 |
||||||||||||||||||||||||
Other asset-backed |
i 1,252 |
( i 17 |
) | i 258 |
i 604 |
( i 6 |
) |
i 137 |
i 1,856 |
( i 23 |
) |
i 395 |
||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position |
$ | i 17,077 |
$ | ( i 680 |
) | i 2,371 |
$ | i 5,394 |
$ | ( i 367 |
) | i 897 |
$ | i 22,471 |
$ | ( i 1,047 |
) | i 3,268 |
||||||||||||||||||
% Below cost: |
||||||||||||||||||||||||||||||||||||
<20% Below cost |
$ | i 17,043 |
$ | ( i 670 |
) | i 2,367 |
$ | i 5,340 |
$ | ( i 349 |
) | i 887 |
$ | i 22,383 |
$ | ( i 1,019 |
) | i 3,254 |
||||||||||||||||||
20%-50% Below cost |
i 34 |
( i 10 |
) | i 4 |
i 54 |
( i 18 |
) |
i 10 |
i 88 |
( i 28 |
) |
i 14 |
||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position |
$ | i 17,077 |
$ | ( i 680 |
) | i 2,371 |
$ | i 5,394 |
$ | ( i 367 |
) | i 897 |
$ | i 22,471 |
$ | ( i 1,047 |
) | i 3,268 |
||||||||||||||||||
Investment grade |
$ | i 15,762 |
$ | ( i 601 |
) | i 2,180 |
$ | i 5,224 |
$ | ( i 345 |
) | i 866 |
$ | i 20,986 |
$ | ( i 946 |
) | i 3,046 |
||||||||||||||||||
Below investment grade |
i 1,315 |
( i 79 |
) | i 191 |
i 170 |
( i 22 |
) |
i 31 |
i 1,485 |
( i 101 |
) |
i 222 |
||||||||||||||||||||||||
Total for fixed maturity securities in an unrealized loss position |
$ | i 17,077 |
$ | ( i 680 |
) | i 2,371 |
$ | i 5,394 |
$ | ( i 367 |
) | i 897 |
$ | i 22,471 |
$ | ( i 1,047 |
) | i 3,268 |
||||||||||||||||||
|
Less than 12 months |
12 months or more |
Total |
||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
Fair value |
Gross unrealized losses |
Number of securities |
|||||||||||||||||||||||||||
Description of Securities |
||||||||||||||||||||||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||||||||||||||
Utilities |
$ | i 1,246 |
$ | ( i 61 |
) | i 173 |
$ | i 343 |
$ | ( i 34 |
) | i 60 |
$ | i 1,589 |
$ | ( i 95 |
) | i 233 |
||||||||||||||||||
Energy |
i 940 |
( i 47 |
) | i 134 |
i 152 |
( i 17 |
) | i 23 |
i 1,092 |
( i 64 |
) | i 157 |
||||||||||||||||||||||||
Finance and insurance |
i 2,393 |
( i 92 |
) | i 326 |
i 679 |
( i 40 |
) | i 93 |
i 3,072 |
( i 132 |
) | i 419 |
||||||||||||||||||||||||
Consumer— non-cyclical |
i 1,819 |
( i 101 |
) | i 202 |
i 389 |
( i 36 |
) | i 55 |
i 2,208 |
( i 137 |
) | i 257 |
||||||||||||||||||||||||
Technology and communications |
i 1,130 |
( i 51 |
) | i 151 |
i 263 |
( i 27 |
) | i 34 |
i 1,393 |
( i 78 |
) | i 185 |
||||||||||||||||||||||||
Industrial |
i 503 |
( i 27 |
) | i 62 |
i 74 |
( i 6 |
) | i 13 |
i 577 |
( i 33 |
) | i 75 |
||||||||||||||||||||||||
Capital goods |
i 704 |
( i 31 |
) | i 103 |
i 184 |
( i 20 |
) | i 27 |
i 888 |
( i 51 |
) | i 130 |
||||||||||||||||||||||||
Consumer—cyclical |
i 738 |
( i 35 |
) | i 123 |
i 162 |
( i 13 |
) | i 26 |
i 900 |
( i 48 |
) | i 149 |
||||||||||||||||||||||||
Transportation |
i 435 |
( i 25 |
) | i 60 |
i 179 |
( i 16 |
) | i 31 |
i 614 |
( i 41 |
) | i 91 |
||||||||||||||||||||||||
Other |
i 48 |
( i 2 |
) | i 4 |
i 15 |
( i 1 |
) | i 1 |
i 63 |
( i 3 |
) | i 5 |
||||||||||||||||||||||||
Subtotal, U.S. corporate securities |
i 9,956 |
( i 472 |
) | i 1,338 |
i 2,440 |
( i 210 |
) | i 363 |
i 12,396 |
( i 682 |
) | i 1,701 |
||||||||||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||||||||||||||
Utilities |
i 359 |
( i 18 |
) | i 44 |
i 103 |
( i 11 |
) | i 9 |
i 462 |
( i 29 |
) | i 53 |
||||||||||||||||||||||||
Energy |
i 406 |
( i 15 |
) | i 56 |
i 60 |
( i 5 |
) | i 10 |
i 466 |
( i 20 |
) | i 66 |
||||||||||||||||||||||||
Finance and insurance |
i 792 |
( i 24 |
) | i 128 |
i 169 |
( i 12 |
) | i 27 |
i 961 |
( i 36 |
) | i 155 |
||||||||||||||||||||||||
Consumer— non-cyclical |
i 374 |
( i 16 |
) | i 49 |
i 79 |
( i 8 |
) | i 9 |
i 453 |
( i 24 |
) | i 58 |
||||||||||||||||||||||||
Technology and communications |
i 572 |
( i 23 |
) | i 61 |
i 26 |
( i 1 |
) | i 6 |
i 598 |
( i 24 |
) | i 67 |
||||||||||||||||||||||||
Industrial |
i 264 |
( i 11 |
) | i 44 |
i 65 |
( i 5 |
) | i 6 |
i 329 |
( i 16 |
) | i 50 |
||||||||||||||||||||||||
Capital goods |
i 214 |
( i 7 |
) | i 24 |
i 57 |
( i 2 |
) | i 10 |
i 271 |
( i 9 |
) | i 34 |
||||||||||||||||||||||||
Consumer—cyclical |
i 204 |
( i 9 |
) | i 30 |
i 20 |
( i 1 |
) | i 3 |
i 224 |
( i 10 |
) | i 33 |
||||||||||||||||||||||||
Transportation |
i 189 |
( i 6 |
) | i 24 |
i 36 |
( i 8 |
) | i 6 |
i 225 |
( i 14 |
) | i 30 |
||||||||||||||||||||||||
Other |
i 310 |
( i 13 |
) | i 42 |
i 49 |
( i 5 |
) | i 10 |
i 359 |
( i 18 |
) | i 52 |
||||||||||||||||||||||||
Subtotal, non-U.S. corporate securities |
i 3,684 |
( i 142 |
) | i 502 |
i 664 |
( i 58 |
) | i 96 |
i 4,348 |
( i 200 |
) | i 598 |
||||||||||||||||||||||||
Total for corporate securities in an unrealized loss position |
$ | i 13,640 |
$ | ( i 614 |
) | i 1,840 |
$ | i 3,104 |
$ | ( i 268 |
) | i 459 |
$ | i 16,744 |
$ | ( i 882 |
) | i 2,299 |
||||||||||||||||||
|
Amortized |
|
||||||
|
cost or |
Fair |
||||||
(Amounts in millions) |
cost |
value |
||||||
Due one year or less |
$ | i 1,421 |
$ | i 1,434 |
||||
Due after one year through five years |
i 8,984 |
i 9,381 |
||||||
Due after five years through ten years |
i 11,230 |
i 12,296 |
||||||
Due after ten years |
i 23,849 |
i 28,647 |
||||||
Subtotal |
i 45,484 |
i 51,758 |
||||||
Residential mortgage-backed |
i 2,057 |
i 2,270 |
||||||
Commercial mortgage-backed |
i 2,897 |
i 3,026 |
||||||
Other asset-backed |
i 3,262 |
i 3,285 |
||||||
Total |
$ |
i 53,700 |
$ | i 60,339 |
||||
|
2019 |
2018 |
||||||||||||||
|
Carrying |
% of |
Carrying |
% of |
||||||||||||
(Amounts in millions) |
value |
total |
value |
total |
||||||||||||
Property type: |
||||||||||||||||
Retail |
$ | i 2,575 |
i 37 |
% | $ | i 2,463 |
i 37 |
% | ||||||||
Industrial |
i 1,660 |
i 24 |
i 1,659 |
i 25 |
||||||||||||
Office |
i 1,627 |
i 23 |
i 1,548 |
i 23 |
||||||||||||
Apartments |
i 524 |
i 8 |
i 495 |
i 7 |
||||||||||||
Mixed use |
i 281 |
i 4 |
i 254 |
i 4 |
||||||||||||
Other |
i 266 |
i 4 |
i 281 |
i 4 |
||||||||||||
Subtotal |
i 6,933 |
i 100 |
% | i 6,700 |
i 100 |
% | ||||||||||
Unamortized balance of loan origination fees and costs |
( i 4 |
) | ( i 4 |
) | ||||||||||||
Allowance for losses |
( i 13 |
) | ( i 9 |
) | ||||||||||||
Total |
$ | i 6,916 |
$ | i 6,687 |
||||||||||||
|
2019 |
2018 |
||||||||||||||
|
Carrying |
% of |
Carrying |
% of |
||||||||||||
(Amounts in millions) |
value |
total |
value |
total |
||||||||||||
Geographic region: |
||||||||||||||||
South Atlantic |
$ | i 1,698 |
i 24 |
% | $ | i 1,709 |
i 26 |
% | ||||||||
Pacific |
i 1,663 |
i 24 |
i 1,684 |
i 25 |
||||||||||||
Middle Atlantic |
i 991 |
i 14 |
i 950 |
i 14 |
||||||||||||
Mountain |
i 746 |
i 11 |
i 667 |
i 10 |
||||||||||||
West North Central |
i 484 |
i 7 |
i 470 |
i 7 |
||||||||||||
East North Central |
i 454 |
i 7 |
i 405 |
i 6 |
||||||||||||
West South Central |
i 428 |
i 6 |
i 364 |
i 6 |
||||||||||||
New England |
i 257 |
i 4 |
i 228 |
i 3 |
||||||||||||
East South Central |
i 212 |
i 3 |
i 223 |
i 3 |
||||||||||||
Subtotal |
i 6,933 |
i 100 |
% | i 6,700 |
i 100 |
% | ||||||||||
Unamortized balance of loan origination fees and costs |
( i 4 |
) | ( i 4 |
) | ||||||||||||
Allowance for losses |
( i 13 |
) | ( i 9 |
) | ||||||||||||
Total |
$ | i 6,916 |
$ | i 6,687 |
||||||||||||
2019 |
||||||||||||||||||||||||
(Amounts in millions) |
31 - 60 dayspast due |
61 - 90 dayspast due |
Greater than 90 days past due |
Total past due |
Current |
Total |
||||||||||||||||||
Property type: |
||||||||||||||||||||||||
Retail |
$ | i — |
$ | i — |
$ | i — |
$ | i — |
$ | i 2,575 |
$ | i 2,575 |
||||||||||||
Industrial |
i — |
i — |
i — |
i — |
i 1,660 |
i 1,660 |
||||||||||||||||||
Office |
i — |
i — |
i — |
i — |
i 1,627 |
i 1,627 |
||||||||||||||||||
Apartments |
i — |
i — |
i — |
i — |
i 524 |
i 524 |
||||||||||||||||||
Mixed use |
i — |
i — |
i — |
i — |
i 281 |
i 281 |
||||||||||||||||||
Other |
i — |
i — |
i — |
i — |
i 266 |
i 266 |
||||||||||||||||||
Total recorded investment |
$ | i — |
$ | i — |
$ | i — |
$ | i — |
$ | i 6,933 |
$ | i 6,933 |
||||||||||||
% of total commercial mortgage loans |
i — |
% | i — |
% | i — |
% | i — |
% | i 100 |
% |
i 100 |
% | ||||||||||||
2018 |
||||||||||||||||||||||||
(Amounts in millions) |
31 - 60 dayspast due |
61 - 90days |
Greater than 90 days past due |
Total past due |
Current |
Total |
||||||||||||||||||
Property type: |
||||||||||||||||||||||||
Retail |
$ | i 3 |
$ | i — |
$ | i — |
$ | i 3 |
$ | i 2,460 |
$ | i 2,463 |
||||||||||||
Industrial |
i — |
i — |
i — |
i — |
i 1,659 |
i 1,659 |
||||||||||||||||||
Office |
i — |
i — |
i 3 |
i 3 |
i 1,545 |
i 1,548 |
||||||||||||||||||
Apartments |
i — |
i — |
i — |
i — |
i 495 |
i 495 |
||||||||||||||||||
Mixed use |
i — |
i — |
i — |
i — |
i 254 |
i 254 |
||||||||||||||||||
Other |
i — |
i — |
i — |
i — |
i 281 |
i 281 |
||||||||||||||||||
Total recorded investment |
$ | i 3 |
$ | i — |
$ | i 3 |
$ | i 6 |
$ | i 6,694 |
$ | i 6,700 |
||||||||||||
% of total commercial mortgage loans |
i — |
% | i — |
% | i — |
% | i — |
% | i 100 |
% |
i 100 |
% | ||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Allowance for credit losses: |
||||||||||||
Beginning balance |
$ | i 9 |
$ | i 9 |
$ | i 12 |
||||||
Charge-offs |
i — |
i — |
i — |
|||||||||
Recoveries |
i — |
i — |
i — |
|||||||||
Provision |
i 4 |
i — |
( i 3 |
) | ||||||||
Ending balance |
$ | i 13 |
$ | i 9 |
$ | i 9 |
||||||
Ending allowance for individually impaired loans |
$ | i — |
$ | i — |
$ | i — |
||||||
Ending allowance for loans not individually impaired that were evaluated collectively for impairment |
$ | i 13 |
$ | i 9 |
$ | i 9 |
||||||
Recorded investment: |
||||||||||||
Ending balance |
$ | i 6,933 |
$ | i 6,700 |
$ | i 6,353 |
||||||
Ending balance of individually impaired loans |
$ | i — |
$ | i 3 |
$ | i 6 |
||||||
Ending balance of loans not individually impaired that were evaluated collectively for impairment |
$ | i 6,933 |
$ | i 6,697 |
$ | i 6,347 |
||||||
2019 |
||||||||||||||||||||||||
(Amounts in millions) |
0% - 50% |
51% - 60% |
61% - 75% |
76% - 100% |
Greater than 100% |
Total |
||||||||||||||||||
Property type: |
||||||||||||||||||||||||
Retail |
$ | i 971 |
$ | i 579 |
$ | i 1,025 |
$ | i — |
$ | i — |
$ | i 2,575 |
||||||||||||
Industrial |
i 798 |
i 337 |
i 525 |
i — |
i — |
i 1,660 |
||||||||||||||||||
Office |
i 524 |
i 380 |
i 723 |
i — |
i — |
i 1,627 |
||||||||||||||||||
Apartments |
i 194 |
i 110 |
i 220 |
i — |
i — |
i 524 |
||||||||||||||||||
Mixed use |
i 104 |
i 70 |
i 107 |
i — |
i — |
i 281 |
||||||||||||||||||
Other |
i 56 |
i 69 |
i 141 |
i — |
i — |
i 266 |
||||||||||||||||||
Total recorded investment |
$ | i 2,647 |
$ | i 1,545 |
$ | i 2,741 |
$ | i — |
$ | i — |
$ | i 6,933 |
||||||||||||
% of total |
i 38 |
% | i 22 |
% | i 40 |
% | i — |
% | i — |
% | i 100 |
% | ||||||||||||
Weighted-average debt service coverage ratio |
i 2.33 |
i 1.81 |
i 1.55 |
i — |
i — |
i 1.90 |
||||||||||||||||||
2018 |
||||||||||||||||||||||||
(Amounts in millions) |
0% - 50% |
51% - 60% |
61% - 75% |
76% - 100% |
Greater than 100% (1) |
Total |
||||||||||||||||||
Property type: |
||||||||||||||||||||||||
Retail |
$ | i 866 |
$ | i 565 |
$ | i 1,017 |
$ | i 15 |
$ | i — |
$ | i 2,463 |
||||||||||||
Industrial |
i 749 |
i 279 |
i 615 |
i 14 |
i 2 |
i 1,659 |
||||||||||||||||||
Office |
i 585 |
i 373 |
i 588 |
i 2 |
i — |
i 1,548 |
||||||||||||||||||
Apartments |
i 206 |
i 95 |
i 189 |
i 5 |
i — |
i 495 |
||||||||||||||||||
Mixed use |
i 105 |
i 36 |
i 113 |
i — |
i — |
i 254 |
||||||||||||||||||
Other |
i 43 |
i 78 |
i 160 |
i — |
i — |
i 281 |
||||||||||||||||||
Total recorded investment |
$ | i 2,554 |
$ | i 1,426 |
$ | i 2,682 |
$ | i 36 |
$ | i 2 |
$ | i 6,700 |
||||||||||||
% of total |
i 38 |
% | i 21 |
% | i 40 |
% | i 1 |
% | i — |
% |
i 100 |
% | ||||||||||||
Weighted-average debt service coverage ratio |
i 2.42 |
i 2.04 |
i 1.59 |
i 1.38 |
i 0.88 |
i 2.00 |
||||||||||||||||||
(1) |
Included a loan with a recorded investment of $ i 2 million in good standing, where the borrower continued to make timely payments, with a loan-to-value of i 105 %.
We evaluated this loan on an individual basis and as it is in good standing, the current recorded investment is expected to be recoverable. |
2019 |
||||||||||||||||||||||||
(Amounts in millions) |
Less than 1.00 |
1.00 - 1.25 |
1.26 - 1.50 |
1.51 - 2.00 |
Greater than 2.00 |
Total |
||||||||||||||||||
Property type: |
||||||||||||||||||||||||
Retail |
$ | i 68 |
$ | i 140 |
$ | i 594 |
$ | i 1,140 |
$ | i 633 |
$ | i 2,575 |
||||||||||||
Industrial |
i 24 |
i 51 |
i 221 |
i 655 |
i 709 |
i 1,660 |
||||||||||||||||||
Office |
i 44 |
i 89 |
i 275 |
i 748 |
i 471 |
i 1,627 |
||||||||||||||||||
Apartments |
i 16 |
i 18 |
i 129 |
i 172 |
i 189 |
i 524 |
||||||||||||||||||
Mixed use |
i 4 |
i 16 |
i 37 |
i 107 |
i 117 |
i 281 |
||||||||||||||||||
Other |
i 34 |
i 147 |
i 20 |
i 31 |
i 34 |
i 266 |
||||||||||||||||||
Total recorded investment |
$ | i 190 |
$ | i 461 |
$ | i 1,276 |
$ | i 2,853 |
$ | i 2,153 |
$ | i 6,933 |
||||||||||||
%of total |
i 3 |
% | i 7 |
% | i 18 |
% | i 41 |
% | i 31 |
% | i 100 |
% | ||||||||||||
Weighted-average loan-to-value |
i 59 |
% | i 62 |
% | i 63 |
% | i 58 |
% | i 41 |
% | i 54 |
% | ||||||||||||
2018 |
||||||||||||||||||||||||
(Amounts in millions) |
Less than 1.00 |
1.00 - 1.25 |
1.26 - 1.50 |
1.51 - 2.00 |
Greater than 2.00 |
Total |
||||||||||||||||||
Property type: |
||||||||||||||||||||||||
Retail |
$ | i 43 |
$ | i 157 |
$ | i 448 |
$ | i 1,234 |
$ | i 581 |
$ | i 2,463 |
||||||||||||
Industrial |
i 22 |
i 75 |
i 233 |
i 653 |
i 676 |
i 1,659 |
||||||||||||||||||
Office |
i 57 |
i 56 |
i 156 |
i 765 |
i 514 |
i 1,548 |
||||||||||||||||||
Apartments |
i 4 |
i 24 |
i 104 |
i 168 |
i 195 |
i 495 |
||||||||||||||||||
Mixed use |
i 3 |
i 19 |
i 51 |
i 80 |
i 101 |
i 254 |
||||||||||||||||||
Other |
i 13 |
i 134 |
i 50 |
i 50 |
i 34 |
i 281 |
||||||||||||||||||
Total recorded investment |
$ | i 142 |
$ | i 465 |
$ | i 1,042 |
$ | i 2,950 |
$ | i 2,101 |
$ | i 6,700 |
||||||||||||
%of total |
i 2 |
% | i 7 |
% | i 16 |
% | i 44 |
% | i 31 |
% | i 100 |
% | ||||||||||||
Weighted-average loan-to-value |
i 57 |
% | i 61 |
% | i 62 |
% | i 59 |
% | i 42 |
% | i 54 |
% | ||||||||||||
Derivative assets |
Derivative liabilities |
|||||||||||||||||||
Balance sheet classification |
Fair value |
Balance sheet classification |
Fair value |
|||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2019 |
2018 |
||||||||||||||||
Derivatives designated as hedges |
||||||||||||||||||||
Cash flow hedges: |
||||||||||||||||||||
Interest rate swaps |
Other invested assets |
$ | i 197 |
$ | i 42 |
Other liabilities |
$ | i 10 |
$ | i 102 |
||||||||||
Foreign currency swaps |
Other invested assets |
i 4 |
i 6 |
Other liabilities |
i — |
i — |
||||||||||||||
Total cash flow hedges |
i 201 |
i 48 |
i 10 |
i 102 |
||||||||||||||||
Total derivatives designated as hedges |
i 201 |
i 48 |
i 10 |
i 102 |
||||||||||||||||
Derivatives not designated as hedges |
||||||||||||||||||||
Equity index options |
Other invested assets |
$ |
i 81 |
$ |
i 39 |
Other liabilities |
$ |
i — |
$ |
i — |
||||||||||
Financial futures |
Other invested assets |
i — |
i — |
Other liabilities |
i — |
i — |
||||||||||||||
Other foreign currency contracts |
Other invested assets |
i 8 |
i 10 |
Other liabilities |
i 1 |
i 7 |
||||||||||||||
GMWB embedded derivatives |
Reinsurance recoverable (1) |
i 20 |
i 20 |
Policyholder account balances (2) |
i 323 |
i 337 |
||||||||||||||
Fixed index annuity embedded derivatives |
Other assets |
i — |
i — |
Policyholder account balances (3) |
i 452 |
i 389 |
||||||||||||||
Indexed universal life embedded derivatives |
Reinsurance recoverable |
i — |
i — |
Policyholder account balances (4) |
i 19 |
i 12 |
||||||||||||||
Total derivatives not designated as hedges |
i 109 |
i 69 |
i 795 |
i 745 |
||||||||||||||||
Total derivatives |
$ |
i 310 |
$ |
i 117 |
$ | i 805 |
$ | i 847 |
||||||||||||
(1) |
Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
(2) |
Represents the embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
(3) |
Represents the embedded derivatives associated with our fixed index annuity liabilities. |
(4) |
Represents the embedded derivatives associated with our indexed universal life liabilities. |
(Notional in millions) |
Measurement |
2018 |
Additions |
Maturities/ terminations |
2019 |
|||||||||||||||
Derivatives designated as hedges |
||||||||||||||||||||
Cash flow hedges: |
||||||||||||||||||||
Interest rate swaps |
Notional |
$ |
i 9,924 |
$ |
i 1,414 |
$ |
( i 2,370 |
) |
$ |
i 8,968 |
||||||||||
Foreign currency swaps |
Notional |
i 80 |
i 52 |
( i 22 |
) |
i 110 |
||||||||||||||
Total cash flow hedges |
i 10,004 |
i 1,466 |
( i 2,392 |
) |
i 9,078 |
|||||||||||||||
Total derivatives designated as hedges |
i 10,004 |
i 1,466 |
( i 2,392 |
) |
i 9,078 |
|||||||||||||||
Derivatives not designated as hedges |
||||||||||||||||||||
Interest rate swaps |
Notional |
$ |
i 4,674 |
$ |
i — |
$ |
i — |
$ |
i 4,674 |
|||||||||||
Interest rate caps |
Notional |
i 424 |
i — |
( i 424 |
) |
i — |
||||||||||||||
Equity index options |
Notional |
i 2,628 |
i 2,479 |
( i 2,656 |
) |
i 2,451 |
||||||||||||||
Financial futures |
Notional |
i 1,415 |
i 5,568 |
( i 5,801 |
) |
i 1,182 |
||||||||||||||
Other foreign currency contracts |
Notional |
i 646 |
i 6,799 |
( i 6,817 |
) |
i 628 |
||||||||||||||
Total derivatives not designated as hedges |
i 9,787 |
i 14,846 |
( i 15,698 |
) |
i 8,935 |
|||||||||||||||
Total derivatives |
$ |
i 19,791 |
$ |
i 16,312 |
$ |
( i 18,090 |
) |
$ |
i 18,013 |
|||||||||||
(Number of policies) |
Measurement |
2018 |
Additions |
Maturities/ terminations |
2019 |
|||||||||||||||
Derivatives not designated as hedges |
||||||||||||||||||||
GMWB embedded derivatives |
Policies |
i 27,886 |
i — |
( i 2,263 |
) |
i 25,623 |
||||||||||||||
Fixed index annuity embedded derivatives |
Policies |
i 16,464 |
i — |
( i 1,023 |
) |
i 15,441 |
||||||||||||||
Indexed universal life embedded derivatives |
Policies |
i 929 |
i — |
( i 45 |
) |
i 884 |
(Amounts in millions) |
Gain (loss) recognized in OCI |
Gain (loss) reclassified into net income from OCI |
Classification of gain (loss) reclassified into net income |
Gain (loss) recognized in net income |
Classification of gain (loss) recognized in net income | |||||||||||
Interest rate swaps hedging assets |
$ |
i 456 |
$ |
i 164 |
Net investment income |
$ |
i — |
Net investment gains (losses) | ||||||||
Interest rate swaps hedging assets |
i — |
i 6 |
Net investment gains (losses) |
i — |
Net investment gains (losses) | |||||||||||
Interest rate swaps hedging liabilities |
( i 36 |
) |
i — |
Interest expense |
i — |
Net investment gains (losses) | ||||||||||
Foreign currency swaps |
( i 2 |
) |
i — |
Net investment income |
i — |
Net investment gains (losses) | ||||||||||
Foreign currency swaps |
i — |
i — |
Net investment gains (losses) |
i 2 |
Net investment gains (losses) | |||||||||||
Total |
$ |
i 418 |
$ |
i 170 |
$ |
i 2 |
||||||||||
(Amounts in millions) |
Gain (loss) recognized in OCI |
Gain (loss) reclassified into income from OCI |
Classification of gain reclassified into net income |
Gain (loss) recognized in income |
Classification of gain recognized in net income | |||||||||||
Interest rate swaps hedging assets |
$ | ( i 261 |
) | $ | i 153 |
Net investment income |
$ | i — |
Net investment gains (losses) | |||||||
Interest rate swaps hedging assets |
i — |
i 9 |
Net investment gains (losses) |
i — |
Net investment gains (losses) | |||||||||||
Interest rate swaps hedging liabilities |
i 16 |
i — |
Interest expense |
i — |
Net investment gains (losses) | |||||||||||
Foreign currency swaps |
i 4 |
i — |
Net investment income |
i — |
Net investment gains (losses) | |||||||||||
Total |
$ | ( i 241 |
) | $ | i 162 |
$ | i — |
|||||||||
(Amounts in millions) |
Gain (loss) recognized in OCI |
Gain (loss) reclassified into income from OCI |
Classification of gain reclassified into net income |
Gain (loss) recognized in net income (1) |
Classification of gain recognized in net income | |||||||||||
Interest rate swaps hedging assets |
$ | i 96 |
$ | i 131 |
Net investment income |
$ | i 2 |
Net investment gains (losses) | ||||||||
Interest rate swaps hedging assets |
i — |
i 8 |
Net investment gains (losses) |
— |
Net investment gains (losses) | |||||||||||
Foreign currency swaps |
( i 2 |
) | i — |
Net investment income |
i — |
Net investment gains (losses) | ||||||||||
Total |
$ | i 94 |
$ | i 139 |
$ | i 2 |
||||||||||
(1) |
Represents ineffective portion of cash flow hedges, as there were no amounts excluded from the measurement of effectiveness. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Derivatives qualifying as effective accounting hedges as of January 1 |
$ | i 1,781 |
$ | i 2,065 |
$ | i 2,085 |
||||||
Cumulative effect of changes in accounting: |
||||||||||||
Stranded tax effects |
i — |
i 12 |
i — |
|||||||||
Changes to the hedge accounting model, net of deferred taxes of $ i —, $( i 1)
and $ i — |
i — |
i 2 |
i — |
|||||||||
Total cumulative effect of changes in accounting |
i — |
i 14 |
i — |
|||||||||
Current period increases (decreases) in fair value, net of deferred taxes of $( i 87), $ i 50
and $( i 56) |
i 331 |
( i 194 |
) | i 38 |
||||||||
Reclassification to net (income), net of deferred taxes of $ i 60, $ i 58
and $ i 81 |
( i 110 |
) | ( i 104 |
) | ( i 58 |
) | ||||||
Derivatives qualifying as effective accounting hedges as of December 31 |
$ | i 2,002 |
$ | i 1,781 |
$ | i 2,065 |
||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
Classification of gain (loss) recognized in net income | ||||||||||
Interest rate swaps |
$ | ( i 3 |
) | $ | i 3 |
$ |
( i 1 |
) | Net investment gains (losses) | |||||
Credit default swaps related to securitization entities (1) |
i — |
i — |
i 7 |
Net investment gains (losses) | ||||||||||
Equity index options |
i 43 |
( i 34 |
) | i 57 |
Net investment gains (losses) | |||||||||
Financial futures |
( i 64 |
) | i 26 |
( i 43 |
) | Net investment gains (losses) | ||||||||
Equity return swaps |
i — |
( i 4 |
) | ( i 22 |
) | Net investment gains (losses) | ||||||||
Other foreign currency contracts |
( i 8 |
) | i 4 |
( i 12 |
) | Net investment gains (losses) | ||||||||
GMWB embedded derivatives |
i 38 |
( i 54 |
) | i 78 |
Net investment gains (losses) | |||||||||
Fixed index annuity embedded derivatives |
( i 90 |
) | i 15 |
( i 84 |
) | Net investment gains (losses) | ||||||||
Indexed universal life embedded derivatives |
i 4 |
i 13 |
i 8 |
Net investment gains (losses) | ||||||||||
Total derivatives not designated as hedges |
$ |
( i 80 |
) | $ | ( i 31 |
) | $ | ( i 12 |
) | |||||
(1) |
See note 17 for additional information related to consolidated securitization entities. |
2019 |
2018 |
|||||||||||||||||||||||
(Amounts in millions) |
Derivative assets (1) |
Derivative liabilities (1) |
Net derivatives |
Derivative assets (1) |
Derivative liabilities (1) |
Net derivatives |
||||||||||||||||||
Amounts presented in the balance sheet: |
||||||||||||||||||||||||
Gross amounts recognized |
$ | i 291 |
$ | i 11 |
$ | i 280 |
$ | i 97 |
$ | i 109 |
$ | ( i 12 |
) | |||||||||||
Gross amounts offset in the balance sheet |
i — |
i — |
i — |
i — |
i — |
i — |
||||||||||||||||||
Net amounts presented in the balance sheet |
i 291 |
i 11 |
i 280 |
i 97 |
i 109 |
( i 12 |
) | |||||||||||||||||
Gross amounts not offset in the balance sheet: |
||||||||||||||||||||||||
Financial instruments (2) |
( i 7 |
) | ( i 7 |
) | i — |
( i 8 |
) |
( i 8 |
) |
i — |
||||||||||||||
Collateral received |
( i 179 |
) | i — |
( i 179 |
) | ( i 54 |
) |
i — |
( i 54 |
) | ||||||||||||||
Collateral pledged |
i — |
( i 405 |
) | i 405 |
i — |
( i 535 |
) |
i 535 |
||||||||||||||||
Over collateralization |
i 18 |
i 401 |
( i 383 |
) | i — |
i 434 |
( i 434 |
) | ||||||||||||||||
Net amount |
$ | i 123 |
$ | i — |
$ | i 123 |
$ | i 35 |
$ | i — |
$ | i 35 |
||||||||||||
(1) |
Included $ i 1 million of accruals on derivatives classified as other assets as of December 31, 2019 and does not include amounts related to embedded derivatives as of December 31, 2019 and 2018. |
(2) |
Amounts represent derivative assets and/or liabilities that are presented gross within the balance sheet but are held with the same counterparty where we have a master netting arrangement. This adjustment results in presenting the net asset and net liability position for each counterparty. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Unamortized balance as of January 1 |
$ | i 3,630 |
$ | i 3,868 |
$ | i 4,120 |
||||||
Impact of foreign currency translation |
i — |
( i 4 |
) | i 3 |
||||||||
Costs deferred |
i 27 |
i 42 |
i 46 |
|||||||||
Amortization, net of interest accretion |
( i 377 |
) | ( i 276 |
) | ( i 301 |
) | ||||||
Unamortized balance as of December 31 |
i 3,280 |
i 3,630 |
i 3,868 |
|||||||||
Accumulated effect of net unrealized investment (gains) losses |
( i 1,444 |
) | ( i 488 |
) | ( i 1,670 |
) | ||||||
Balance as of December 31 |
$ | i 1,836 |
$ | i 3,142 |
$ | i 2,198 |
||||||
2019 |
2018 |
|||||||||||||||
(Amounts in millions) |
Gross carrying amount |
Accumulated amortization |
Gross carrying amount |
Accumulated amortization |
||||||||||||
PVFP |
$ | i 2,066 |
$ | ( i 1,992 |
) | $ | i 2,115 |
$ | ( i 1,976 |
) | ||||||
Capitalized software |
i 487 |
( i 403 |
) | i 462 |
( i 377 |
) | ||||||||||
Deferred sales inducements to contractholders |
i 288 |
( i 258 |
) | i 318 |
( i 243 |
) | ||||||||||
Other |
i 138 |
( i 130 |
) | i 138 |
( i 109 |
) | ||||||||||
Total |
$ | i 2,979 |
$ | ( i 2,783 |
) | $ | i 3,033 |
$ | ( i 2,705 |
) | ||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Unamortized balance as of January 1 |
$ | i 170 |
$ | i 187 |
$ | i 222 |
||||||
Interest accreted at i 5.56 %, i 5.60 %
and i 5.38 % |
i 9 |
i 10 |
i 11 |
|||||||||
Amortization |
( i 25 |
) | ( i 27 |
) | ( i 46 |
) | ||||||
Unamortized balance as of December 31 |
i 154 |
i 170 |
i 187 |
|||||||||
Accumulated effect of net unrealized investment (gains) losses |
( i 80 |
) | ( i 31 |
) | ( i 100 |
) | ||||||
Balance as of December 31 |
$ | i 74 |
$ | i 139 |
$ | i 87 |
||||||
2020 |
i 5.1 |
% | ||
2021 |
i 5.1 |
% | ||
2022 |
i 4.7 |
% | ||
2023 |
i 4.6 |
% | ||
2024 |
i 4.3 |
% |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Direct life insurance in-force |
$ | i 555,252 |
$ | i 594,472 |
$ | i 625,710 |
||||||
Amounts assumed from other companies |
i 673 |
i 729 |
i 793 |
|||||||||
Amounts ceded to other companies (1) |
( i 500,965 |
) | ( i 537,590 |
) | ( i 562,463 |
) | ||||||
Net life insurance in-force |
$ | i 54,960 |
$ | i 57,611 |
$ | i 64,040 |
||||||
Percentage of amount assumed to net |
i 1% |
i 1 |
% | i 1 |
% | |||||||
(1) |
Includes amounts accounted for under the deposit method. |
Written |
Earned |
|||||||||||||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
2019 |
2018 |
2017 |
||||||||||||||||||
Direct: |
||||||||||||||||||||||||
Life insurance |
$ | i 846 |
$ | i 881 |
$ | i 929 |
$ | i 846 |
$ | i 881 |
$ | i 929 |
||||||||||||
Accident and health insurance (1) |
i 2,792 |
i 2,775 |
i 2,732 |
i 2,821 |
i 2,800 |
i 2,756 |
||||||||||||||||||
Mortgage insurance |
i 1,157 |
i 1,092 |
i 1,062 |
i 1,239 |
i 1,194 |
i 635 |
||||||||||||||||||
Total direct |
i 4,795 |
i 4,748 |
i 4,723 |
i 4,906 |
i 4,875 |
i 4,320 |
||||||||||||||||||
Assumed: |
||||||||||||||||||||||||
Life insurance |
i 1 |
i 1 |
i 38 |
i 1 |
i 1 |
i 38 |
||||||||||||||||||
Accident and health insurance (1) |
i 321 |
i 328 |
i 337 |
i 326 |
i 332 |
i 341 |
||||||||||||||||||
Mortgage insurance |
i 5 |
i 7 |
i 7 |
i 8 |
i 11 |
i 2 |
||||||||||||||||||
Total assumed |
i 327 |
i 336 |
i 382 |
i 335 |
i 344 |
i 381 |
||||||||||||||||||
Ceded: |
||||||||||||||||||||||||
Life insurance |
( i 569 |
) | ( i 576 |
) | ( i 538 |
) | ( i 569 |
) | ( i 576 |
) | ( i 538 |
) | ||||||||||||
Accident and health insurance (1) |
( i 557 |
) | ( i 566 |
) | ( i 596 |
) | ( i 564 |
) | ( i 571 |
) | ( i 604 |
) | ||||||||||||
Mortgage insurance |
( i 64 |
) | ( i 85 |
) | ( i 74 |
) | ( i 71 |
) | ( i 78 |
) | ( i 74 |
) | ||||||||||||
Total ceded |
( i 1,190 |
) | ( i 1,227 |
) | ( i 1,208 |
) | ( i 1,204 |
) | ( i 1,225 |
) | ( i 1,216 |
) | ||||||||||||
Net premiums |
$ | i 3,932 |
$ | i 3,857 |
$ | i 3,897 |
$ | i 4,037 |
$ | i 3,994 |
$ | i 3,485 |
||||||||||||
Percentage of amount assumed to net |
|
i 8% |
i 9 |
% | i 11 |
% | ||||||||||||||||||
(1) |
Accident and health insurance is comprised almost entirely of our long-term care insurance products. |
(Amounts in millions) |
Mortality/ morbidity assumption |
|
Interest rate assumption |
2019 |
2018 |
|||||||||
Long-term care insurance contracts |
|
(a |
) |
|
i 3.75% - i 7.50%
|
$ | i 26,170 |
$ | i 23,497 |
|||||
Structured settlements with life contingencies |
|
(b |
) |
|
i 1.00% - i 8.00%
|
i 8,398 |
i 8,576 |
|||||||
Annuity contracts with life contingencies |
|
(b |
) |
|
i 1.00% - i 8.00%
|
i 3,281 |
i 3,238 |
|||||||
Traditional life insurance contracts |
|
(c |
) |
|
i 3.00% - i 7.50%
|
i 2,205 |
i 2,300 |
|||||||
Supplementary contracts with life contingencies |
|
(b |
) |
|
i 1.00% - i 8.00%
|
i 330 |
i 329 |
|||||||
|
||||||||||||||
Total future policy benefits |
|
$ | i 40,384 |
$ | i 37,940 |
|||||||||
|
(a) |
The 1983 Individual Annuitant Mortality Table or the 2000 U.S. Annuity Table, or the 1983 Group Annuitant Mortality Table or the 1994 Group Annuitant Mortality Table and company experience. |
(b) |
Assumptions for limited-payment contracts come from either the U.S. Population Table, the 1983 Group Annuitant Mortality Table, the 1983 Individual Annuitant Mortality Table, the Annuity 2000 Mortality Table or the 2012 Individual Annuity Reserving Table. |
(c) |
Principally modifications based on company experience of the Society of Actuaries 1965-70 or 1975-80 Select and the Ultimate Tables, the 1941, 1958, 1980 and 2001 Commissioner’s Standard Ordinary Tables, the 1980 Commissioner’s Extended Term table and (IA) Standard Table 1996 (modified). |
(Amounts in millions) |
2019 |
2018 |
||||||
Annuity contracts |
$ | i 9,375 |
$ | i 10,744 |
||||
Funding agreements |
i 253 |
i 381 |
||||||
Structured settlements without life contingencies |
i 1,219 |
i 1,329 |
||||||
Supplementary contracts without life contingencies |
i 606 |
i 636 |
||||||
Other |
i 13 |
i 15 |
||||||
Total investment contracts |
i 11,466 |
i 13,105 |
||||||
Universal and term universal life insurance contracts |
i 10,751 |
i 9,863 |
||||||
Total policyholder account balances |
$ | i 22,217 |
$ | i 22,968 |
||||
(Dollar amounts in millions) |
2019 |
2018 |
||||||
Account values with death benefit guarantees (net of reinsurance): |
||||||||
Standard death benefits (return of net deposits) account value |
$ | i 2,008 |
$ | i 1,937 |
||||
Net amount at risk |
$ | i 2 |
$ | i 3 |
||||
Average attained age of contractholders |
i 76 |
i 75 |
||||||
Enhanced death benefits (ratchet, rollup) account value |
$ | i 1,986 |
$ | i 1,969 |
||||
Net amount at risk |
$ | i 115 |
$ | i 207 |
||||
Average attained age of contractholders |
i 75 |
i 75 |
||||||
Account values with living benefit guarantees: |
||||||||
GMWBs |
$ | i 2,106 |
$ | i 2,105 |
||||
Guaranteed annuitization benefits |
$ | i 1,030 |
$ | i 995 |
(Amounts in millions) |
2019 |
2018 |
||||||
Balanced funds |
$ | i 2,446 |
$ | i 2,414 |
||||
Equity funds |
i 1,079 |
i 1,003 |
||||||
Bond funds |
i 385 |
i 399 |
||||||
Money market funds |
i 84 |
i 80 |
||||||
Total |
$ | i 3,994 |
$ | i 3,896 |
||||
(Amounts in millions) |
2019 |
2018 |
||||||
Long-term care insurance |
$ | i 10,239 |
$ | i 9,516 |
||||
Life insurance |
i 248 |
i 243 |
||||||
Fixed annuities |
i 13 |
i 23 |
||||||
Runoff |
i 9 |
i 14 |
||||||
Total |
i 10,509 |
i 9,796 |
||||||
U.S. Mortgage Insurance segment |
i 233 |
i 296 |
||||||
Australia Mortgage Insurance segment |
i 208 |
i 196 |
||||||
Other mortgage insurance businesses |
i 8 |
i 7 |
||||||
Total |
i 449 |
i 499 |
||||||
Total liability for policy and contract claims |
$ | i 10,958 |
$ | i 10,295 |
||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Beginning balance as of January 1 |
$ | i 9,516 |
$ | i 8,548 |
$ | i 8,034 |
||||||
Less reinsurance recoverables |
( i 2,262 |
) | ( i 2,292 |
) | ( i 2,310 |
) | ||||||
Net balance as of January 1 |
i 7,254 |
i 6,256 |
i 5,724 |
|||||||||
Incurred related to insured events of: |
||||||||||||
Current year |
i 2,717 |
i 2,548 |
i 2,234 |
|||||||||
Prior years |
( i 219 |
) | i 130 |
( i 183 |
) | |||||||
Total incurred |
i 2,498 |
i 2,678 |
i 2,051 |
|||||||||
Paid related to insured events of: |
||||||||||||
Current year |
( i 205 |
) | ( i 201 |
) | ( i 176 |
) | ||||||
Prior years |
( i 1,975 |
) | ( i 1,814 |
) | ( i 1,644 |
) | ||||||
Total paid |
( i 2,180 |
) | ( i 2,015 |
) | ( i 1,820 |
) | ||||||
Interest on liability for policy and contract claims |
i 384 |
i 335 |
i 301 |
|||||||||
Net balance as of December 31 |
i 7,956 |
i 7,254 |
i 6,256 |
|||||||||
Add reinsurance recoverables |
i 2,283 |
i 2,262 |
i 2,292 |
|||||||||
Ending balance as of December 31 |
$ | i 10,239 |
$ | i 9,516 |
$ | i 8,548 |
||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance |
Total of Incurred- But-Not- Reported liabilities including expected development on reported claims as of December 31, 2019 |
Number of reported delinquencies (2) |
||||||||||||||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) |
For the years ended December 31, |
|||||||||||||||||||||||||||||||||||||||||||||||
Accident year (1) |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
||||||||||||||||||||||||||||||||||||||
Unaudited |
||||||||||||||||||||||||||||||||||||||||||||||||
2010 |
$ | i 977 |
$ | i 1,157 |
$ | i 1,139 |
$ | i 1,146 |
$ | i 1,165 |
$ | i 1,173 |
$ | i 1,173 |
$ | i 1,174 |
$ | i 1,174 |
$ | i 1,174 |
$ | i — |
i 90,500 |
|||||||||||||||||||||||||
2011 |
— |
i 910 |
i 931 |
i 913 |
i 929 |
i 938 |
i 939 |
i 939 |
i 939 |
i 938 |
i — |
i 69,249 |
||||||||||||||||||||||||||||||||||||
2012 |
— |
— |
i 718 |
i 675 |
i 671 |
i 673 |
i 671 |
i 668 |
i 667 |
i 666 |
i — |
i 48,499 |
||||||||||||||||||||||||||||||||||||
2013 |
— |
— |
— |
i 475 |
i 407 |
i 392 |
i 387 |
i 384 |
i 382 |
i 381 |
i — |
i 34,319 |
||||||||||||||||||||||||||||||||||||
2014 |
— |
— |
— |
— |
i 328 |
i 288 |
i 269 |
i 261 |
i 259 |
i 258 |
i — |
i 26,613 |
||||||||||||||||||||||||||||||||||||
2015 |
— |
— |
— |
— |
— |
i 235 |
i 208 |
i 187 |
i 181 |
i 180 |
i 1 |
i 21,599 |
||||||||||||||||||||||||||||||||||||
2016 |
— |
— |
— |
— |
— |
— |
i 198 |
i 160 |
i 138 |
i 136 |
i 1 |
i 18,869 |
||||||||||||||||||||||||||||||||||||
2017 |
— |
— |
— |
— |
— |
— |
— |
i 171 |
i 121 |
i 102 |
i 1 |
i 19,002 |
||||||||||||||||||||||||||||||||||||
2018 |
— |
— |
— |
— |
— |
— |
— |
— |
i 117 |
i 84 |
i 1 |
i 13,688 |
||||||||||||||||||||||||||||||||||||
2019 |
— |
— |
— |
— |
— |
— |
— |
— |
— |
i 106 |
i 14 |
i 11,883 |
||||||||||||||||||||||||||||||||||||
Total incurred |
$ | i 4,025 |
|
|||||||||||||||||||||||||||||||||||||||||||||
(1) |
Represents the year in which first monthly mortgage payments have been missed by the borrower. |
(2) |
Represents reported and outstanding delinquencies less actual cures as of December 31 for each respective accident year. |
(Amounts in millions) |
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance |
|||||||||||||||||||||||||||||||||||||||
Accident year (1) |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
||||||||||||||||||||||||||||||
Unaudited |
||||||||||||||||||||||||||||||||||||||||
2010 |
$ |
i 140 |
$ |
i 567 |
$ |
i 844 |
$ |
i 973 |
$ |
i 1,049 |
$ |
i 1,109 |
$ |
i 1,139 |
$ |
i 1,158 |
$ |
i 1,167 |
$ |
i 1,170 |
||||||||||||||||||||
2011 |
— |
i 65 |
i 497 |
i 722 |
i 816 |
i 874 |
i 906 |
i 927 |
i 935 |
i 937 |
||||||||||||||||||||||||||||||
2012 |
— |
— |
i 92 |
i 391 |
i 532 |
i 602 |
i 634 |
i 650 |
i 658 |
i 662 |
||||||||||||||||||||||||||||||
2013 |
— |
— |
— |
i 44 |
i 202 |
i 297 |
i 340 |
i 362 |
i 372 |
i 375 |
||||||||||||||||||||||||||||||
2014 |
— |
— |
— |
— |
i 22 |
i 127 |
i 195 |
i 233 |
i 247 |
i 253 |
||||||||||||||||||||||||||||||
2015 |
— |
— |
— |
— |
— |
i 12 |
i 85 |
i 145 |
i 167 |
i 173 |
||||||||||||||||||||||||||||||
2016 |
— |
— |
— |
— |
— |
— |
i 10 |
i 64 |
i 110 |
i 124 |
||||||||||||||||||||||||||||||
2017 |
— |
— |
— |
— |
— |
— |
— |
i 6 |
i 46 |
i 77 |
||||||||||||||||||||||||||||||
2018 |
— |
— |
— |
— |
— |
— |
— |
— |
i 3 |
i 32 |
||||||||||||||||||||||||||||||
2019 |
— |
— |
— |
— |
— |
— |
— |
— |
— |
i 2 |
||||||||||||||||||||||||||||||
Total paid |
$ | i 3,805 |
||||||||||||||||||||||||||||||||||||||
Total incurred |
$ | i 4,025 |
||||||||||||||||||||||||||||||||||||||
Total paid |
i 3,805 |
|||||||||||||||||||||||||||||||||||||||
All outstanding liabilities before 2010, net of reinsurance |
i 13 |
|||||||||||||||||||||||||||||||||||||||
Liability for policy and contract claims, net of reinsurance |
$ | i 233 |
||||||||||||||||||||||||||||||||||||||
(1) |
Represents the year in which first monthly mortgage payments have been missed by the borrower. |
Average annual percentage payout of incurred claims, net of reinsurance, by age |
||||||||||||||||||||||||||||||||||||||||
Years |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
||||||||||||||||||||||||||||||
Unaudited |
||||||||||||||||||||||||||||||||||||||||
Percentage of payout |
i 7.8 |
% |
i 40.2 |
% |
i 27.4 |
% |
i 11.3 |
% |
i 5.3 |
% |
i 3.1 |
% |
i 1.7 |
% |
i 1.0 |
% |
i 0.5 |
% |
i 0.3 |
% |
Incurred claims and allocated claim adjustment expenses |
Total of Incurred- But-Not- Reported liabilities including expected development on reported claims as of December 31, 2019 |
Number of reported delinquencies (3) |
||||||||||||||||||||||||||||||||||||||||||||||
(Dollar amounts in millions) (1) |
For the years ended December 31, |
|||||||||||||||||||||||||||||||||||||||||||||||
Accident year (2) |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
||||||||||||||||||||||||||||||||||||||
Unaudited |
||||||||||||||||||||||||||||||||||||||||||||||||
2010 |
$ |
i 52 |
$ |
i 101 |
$ |
i 132 |
$ |
i 132 |
$ |
i 130 |
$ |
i 130 |
$ |
i 128 |
$ |
i 129 |
$ |
i 128 |
$ |
i 128 |
$ |
i — |
i 2,340 |
|||||||||||||||||||||||||
2011 |
— |
i 71 |
i 136 |
i 132 |
i 127 |
i 125 |
i 123 |
i 123 |
i 122 |
i 122 |
i — |
i 2,335 |
||||||||||||||||||||||||||||||||||||
2012 |
— |
— |
i 67 |
i 107 |
i 94 |
i 91 |
i 87 |
i 87 |
i 87 |
i 87 |
i — |
i 1,887 |
||||||||||||||||||||||||||||||||||||
2013 |
— |
— |
— |
i 63 |
i 83 |
i 71 |
i 65 |
i 61 |
i 62 |
i 62 |
i — |
i 1,526 |
||||||||||||||||||||||||||||||||||||
2014 |
— |
— |
— |
— |
i 60 |
i 84 |
i 71 |
i 66 |
i 64 |
i 64 |
i — |
i 1,403 |
||||||||||||||||||||||||||||||||||||
2015 |
— |
— |
— |
— |
— |
i 71 |
i 106 |
i 89 |
i 86 |
i 84 |
i — |
i 1,446 |
||||||||||||||||||||||||||||||||||||
2016 |
— |
— |
— |
— |
— |
— |
i 97 |
i 130 |
i 116 |
i 110 |
i 1 |
i 1,802 |
||||||||||||||||||||||||||||||||||||
2017 |
— |
— |
— |
— |
— |
— |
— |
i 92 |
i 125 |
i 108 |
i 2 |
i 2,061 |
||||||||||||||||||||||||||||||||||||
2018 |
— |
— |
— |
— |
— |
— |
— |
— |
i 88 |
i 109 |
i 15 |
i 3,383 |
||||||||||||||||||||||||||||||||||||
2019 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
i 108 |
|
|
|
i 30 |
|
|
|
i 3,092 |
|
Total incurred |
$ | i 982 |
|
|||||||||||||||||||||||||||||||||||||||||||||
(1) |
Amounts translated into U.S. dollars at the average foreign exchange rates for the year ended December 31, 2019. |
(2) |
Represents the year in which first monthly mortgage payments have been missed by the borrower. |
(3) |
Represents outstanding delinquencies plus paid claims as of December 31, 2019 for each respective accident year. |
(Amounts in millions) (1) |
Cumulative paid claims and allocated claim adjustment expenses |
|||||||||||||||||||||||||||||||||||||||
Accident year (2) |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
||||||||||||||||||||||||||||||
Unaudited |
||||||||||||||||||||||||||||||||||||||||
2010 |
$ |
i 6 |
$ |
i 29 |
$ |
i 104 |
$ |
i 124 |
$ |
i 126 |
$ |
i 128 |
$ |
i 128 |
$ |
i 128 |
$ |
i 128 |
$ |
i 128 |
||||||||||||||||||||
2011 |
— |
i 4 |
i 69 |
i 112 |
i 120 |
i 122 |
i 122 |
i 122 |
i 122 |
i 122 |
||||||||||||||||||||||||||||||
2012 |
— |
— |
i 11 |
i 62 |
i 80 |
i 84 |
i 85 |
i 86 |
i 87 |
i 87 |
||||||||||||||||||||||||||||||
2013 |
— |
— |
— |
i 10 |
i 36 |
i 52 |
i 58 |
i 60 |
i 61 |
i 61 |
||||||||||||||||||||||||||||||
2014 |
— |
— |
— |
— |
i 6 |
i 26 |
i 47 |
i 59 |
i 62 |
i 63 |
||||||||||||||||||||||||||||||
2015 |
— |
— |
— |
— |
— |
i 4 |
i 28 |
i 66 |
i 77 |
i 80 |
||||||||||||||||||||||||||||||
2016 |
— |
— |
— |
— |
— |
— |
i 6 |
i 52 |
i 86 |
i 96 |
||||||||||||||||||||||||||||||
2017 |
— |
— |
— |
— |
— |
— |
— |
i 9 |
i 50 |
i 77 |
||||||||||||||||||||||||||||||
2018 |
— |
— |
— |
— |
— |
— |
— |
— |
i 11 |
i 47 |
||||||||||||||||||||||||||||||
2019 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
i 14 |
|
Total paid |
$ | i 775 |
||||||||||||||||||||||||||||||||||||||
Total incurred |
$ | i 982 |
||||||||||||||||||||||||||||||||||||||
Total paid |
i 775 |
|||||||||||||||||||||||||||||||||||||||
Other (3) |
i 1 |
|||||||||||||||||||||||||||||||||||||||
All outstanding liabilities before 2010 |
i — |
|||||||||||||||||||||||||||||||||||||||
Liability for policy and contract claims |
$ | i 208 |
||||||||||||||||||||||||||||||||||||||
(1) |
Amounts translated into U.S. dollars at the average foreign |
(2) |
Represents the year in which first monthly mortgage payments have been missed by the borrower. |
(3) |
Includes foreign currency translation. |
Average annual percentage payout of |
||||||||||||||||||||||||||||||||||||||||
Years |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
||||||||||||||||||||||||||||||
Unaudited |
||||||||||||||||||||||||||||||||||||||||
Percentage of payout |
i 8.8 |
% |
i 38.2 |
% |
i 34.1 |
% |
i 11.2 |
% |
i 2.6 |
% |
i 0.9 |
% |
i 0.5 |
% |
i 0.2 |
% |
i — |
% |
i — |
% |
(Amounts in millions) |
2019 |
2018 |
||||||
Genworth Holdings |
||||||||
Floating Rate Senior Secured Term Loan Facility, due i i 2023 /
|
$ | — |
$ | i 445 |
||||
i i 7.70 / %
Senior Notes, due i i 2020 / |
i 397 |
i 397 |
||||||
i i 7.20 / %
Senior Notes, due i i 2021 / |
i 382 |
i 381 |
||||||
i i 7.625 / %
Senior Notes, due i i 2021 / |
i 701 |
i 703 |
||||||
i i 4.90 / %
Senior Notes, due i i 2023 / |
i 399 |
i 399 |
||||||
i i 4.80 / %
Senior Notes, due i i 2024 / |
i 400 |
i 400 |
||||||
i i 6.50 / %
Senior Notes, due i i 2034 / |
i 297 |
i 297 |
||||||
Floating Rate Junior Subordinated Notes, due i i 2066 /
|
i 598 |
i 598 |
||||||
Subtotal |
i 3,174 |
i 3,620 |
||||||
Bond consent fees |
( i 25 |
) | ( i 32 |
) | ||||
Deferred borrowing charges |
( i 12 |
) | ( i 21 |
) | ||||
Total Genworth Holdings |
i 3,137 |
i 3,567 |
||||||
Australia |
||||||||
Floating Rate Junior Subordinated Notes, due i i 2025 /
|
i 140 |
i 141 |
||||||
Deferred borrowing charges |
— |
( i 1 |
) | |||||
Total Australia |
i 140 |
i 140 |
||||||
Total |
$ | i 3,277 |
$ | i 3,707 |
||||
(Amounts in millions) |
Amount |
|||
2020 (1) |
$ | i 397 |
||
2021 |
i 1,083 |
|||
2022 |
i — |
|||
2023 |
i 399 |
|||
2024 and thereafter ( 2) |
i 1,750 |
|||
Total |
$ | i 3,629 |
||
(1) |
On January 21, 2020, Genworth Holdings fully redeemed its i 7.70% senior notes of $ i 397 million
originally scheduled to mature in June 2020. |
(2) |
Our non-recourse funding obligations of $ i 315 million due in 2050 were fully redeemed in January 2020. |
2019 |
||||||||||||||||||||
(Amounts in millions) |
Overnight and continuous |
Up to 30 days |
31 - 90days |
Greater than 90 days |
Total |
|||||||||||||||
Securities lending: |
||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||
Non-U.S. government |
$ | i 1 |
$ | — |
$ | — |
$ | — |
$ | i 1 |
||||||||||
U.S. corporate |
i 34 |
— |
— |
— |
i 34 |
|||||||||||||||
Non-U.S. corporate |
i 16 |
— |
— |
— |
i 16 |
|||||||||||||||
Subtotal, fixed maturity securities |
i 51 |
— |
— |
— |
i 51 |
|||||||||||||||
Total securities lending |
$ | i 51 |
$ | — |
$ | — |
$ | — |
$ | i 51 |
||||||||||
2018 |
||||||||||||||||||||
(Amounts in millions) |
Overnight and continuous |
Up to 30 days |
31 - 90days |
Greater than 90 days |
Total |
|||||||||||||||
Securities lending: |
||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||
Non-U.S. government |
$ | i 11 |
$ | — |
$ | — |
$ | — |
$ | i 11 |
||||||||||
U.S. corporate |
i 67 |
— |
— |
— |
i 67 |
|||||||||||||||
Non-U.S. corporate |
i 23 |
— |
— |
— |
i 23 |
|||||||||||||||
Subtotal, fixed maturity securities |
i 101 |
— |
— |
— |
i 101 |
|||||||||||||||
Equity securities |
i 1 |
— |
— |
— |
i 1 |
|||||||||||||||
Total securities lending |
$ | i 102 |
$ | — |
$ | — |
$ | — |
$ | i 102 |
||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Domestic |
$ | i 540 |
$ | ( i 57 |
) | $ | i 380 |
|||||
Foreign |
i 174 |
i 194 |
( i 253 |
) | ||||||||
Income from continuing operations before income taxes |
$ | i 714 |
|
$ | i 137 |
$ | i 127 |
|||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Current federal income taxes |
$ | i 6 |
$ | i 11 |
$ | ( i 32 |
) | |||||
Deferred federal income taxes |
i 111 |
( i 14 |
) | ( i 314 |
) | |||||||
Total federal income taxes |
i 117 |
( i 3 |
) | ( i 346 |
) | |||||||
Current state income taxes |
i 2 |
i 1 |
i 1 |
|||||||||
Deferred state income taxes |
i 5 |
i — |
i 6 |
|||||||||
Total state income taxes |
i 7 |
i 1 |
i 7 |
|||||||||
Current foreign income taxes |
i 48 |
i 30 | i 52 | |||||||||
Deferred foreign income taxes |
i 23 |
i 42 | ( i 119 | ) | ||||||||
Total foreign income taxes |
i 71 |
i 72 | ( i 67 | ) | ||||||||
Total provision (benefit) for income taxes |
$ | i 195 |
$ | i 70 |
$ | ( i 406 | ) | |||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Statutory U.S. federal income tax rate |
i 21.0 |
% | i 21.0 |
% | i 35.0 |
% | ||||||
Increase (reduction) in rate resulting from: |
||||||||||||
Effect of foreign operations |
i 2.2 |
i 15.3 |
i 9.1 |
|||||||||
Swaps terminated prior to the TCJA |
i 3.3 |
i 16.6 |
i — |
|||||||||
Stock-based compensation |
i 0.1 |
i 4.2 |
i 4.5 |
|||||||||
Valuation allowance |
i — |
( i 5.4 |
) | ( i 203.3 |
) | |||||||
Prior year adjustments |
i — |
( i 2.4 |
) |
i 3.6 |
||||||||
Tax favored investments |
( i 0.6 |
) |
( i 3.4 |
) |
( i 3.5 |
) | ||||||
Nondeductible expenses |
i 0.5 |
i 3.0 |
i 1.2 |
|||||||||
State income tax, net of federal income tax effect |
i 0.8 |
i 0.8 |
i 3.4 |
|||||||||
Other, net |
i — |
( i 0.6 |
) |
i 1.6 |
||||||||
TCJA, impact from change in tax rate |
i — |
i 8.8 |
( i 121.0 |
) | ||||||||
TCJA, impact on foreign operations |
i — |
( i 7.1 |
) |
( i 50.1 |
) | |||||||
Effective rate |
i 27.3 |
% | i 50.8 |
% | ( i 319.5 |
)% | ||||||
(Amounts in millions) |
2019 |
2018 |
||||||
Assets: |
||||||||
Foreign tax credit carryforwards |
$ | i 320 |
$ | i 265 |
||||
Net operating loss carryforwards |
i 129 |
i 297 |
||||||
State income taxes |
i 336 |
i 326 |
||||||
Insurance reserves |
i 686 |
i 754 |
||||||
Accrued commission and general expenses |
i 142 |
i 116 |
||||||
Net unrealized losses on derivatives |
i — |
i 10 |
||||||
Investments |
i 48 |
i 5 |
||||||
Other |
i 51 |
i 25 |
||||||
Gross deferred income tax assets |
i 1,712 |
i 1,798 |
||||||
Valuation allowance |
( i 347 |
) | ( i 334 |
) | ||||
Total deferred income tax assets |
i 1,365 |
i 1,464 |
||||||
Liabilities: |
||||||||
Net unrealized gains on investment securities |
i 396 |
i 153 |
||||||
Net unrealized gains on derivatives |
i 71 |
i — |
||||||
DAC |
i 275 |
i 344 |
||||||
PVFP and other intangibles |
i 21 |
i 52 |
||||||
Insurance reserves transition adjustment |
i 148 |
i 149 |
||||||
Other |
i 29 |
i 30 |
||||||
Total deferred income tax liabilities |
i 940 |
i 728 |
||||||
Net deferred income tax asset |
$ | i 425 |
$ | i 736 |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Balance as of January 1 |
$ | i 79 |
$ | i 42 |
$ | i 34 |
||||||
Tax positions related to the current period: |
||||||||||||
Gross additions |
i — |
i 2 |
i 2 |
|||||||||
Gross reductions |
( i 15 |
) | ( i 3 |
) | ( i 1 |
) | ||||||
Tax positions related to the prior years: |
||||||||||||
Gross additions |
i — |
i 40 |
i 13 |
|||||||||
Gross reductions |
i — |
( i 2 |
) | ( i 6 |
) | |||||||
Balance as of December 31 |
$ | i 64 |
$ | i 79 |
$ | i 42 |
||||||
Time-based |
Performance-based |
|||||||
(Number of awards, in millions) |
cash awards |
cash awards |
||||||
Balance as of January 1, 2018 |
i 18 |
i 8 |
||||||
Granted |
i 17 |
i 9 |
||||||
Performance adjustment |
i — |
i 1 |
||||||
Vested |
( i 10 |
) | i — |
|||||
Forfeited |
( i 1 |
) | ( i 1 |
) | ||||
Balance as of January 1, 2019 |
i 24 |
i 17 |
||||||
Granted |
i 16 |
i — |
||||||
Performance adjustment |
i — |
i 1 |
||||||
Vested |
( i 12 |
) | ( i 4 |
) | ||||
Forfeited |
( i 2 |
) | ( i 1 |
) | ||||
Balance as of December 31, 2019 |
i 26 |
i 13 |
||||||
|
Shares subject |
Weighted-average |
||||||
(Shares in thousands) |
to option |
exercise price |
||||||
Balance as of January 1, 2018 |
i 1,580 |
$ | i 11.38 |
|||||
Granted |
i — |
$ | i — |
|||||
Exercised |
( i 108 |
) | $ | i 2.37 |
||||
Expired and forfeited |
( i 354 |
) | $ | i 12.88 |
||||
Balance as of January 1, 2019 |
i 1,118 |
$ | i 11.77 |
|||||
Granted |
i — |
$ | i — |
|||||
Exercised |
( i 200 |
) | $ | i 2.46 |
||||
Expired and forfeited |
( i 117 |
) | $ | i 11.30 |
||||
Balance as of December 31, 2019 |
i 801 |
$ | i 14.17 |
|||||
Exercisable as of December 31, 2019 |
i 801 |
$ | i 14.17 |
|
|
Outstanding and Exercisable |
| |||||||
Exercise/Average price |
Shares in thousands |
Average lif e(1) |
||||||||
$ i 12.75 (2) |
i 11 |
|
i 0.93 |
|||||||
$ i 14.18 |
i 777 |
i 0.11 |
||||||||
$ i 14.92 |
i 13 |
i 0.42 |
||||||||
$ i 14.17 |
i 801 |
|
||||||||
(1) |
Average contractual life remaining in years. |
(2) |
Shares for b options outstanding and exercisable have i i no / aggregate
intrinsic valueoth . |
RSUs |
PSUs |
DSUs |
SARs |
|||||||||||||||||||||||||||||
(Awards in thousands) |
Number of awards |
Weighted- average grant date fair |
Number of awards |
Weighted- average fair value |
Number of awards |
Weighted- average fair value |
Number of awards |
Weighted- average grant date fair |
||||||||||||||||||||||||
Balance as of January 1, 2018 |
i 3,651 |
$ | i 5.14 |
i 4,584 |
$ | i 3.65 |
i 1,259 |
$ | i 5.70 |
i 10,301 |
$ | i 3.45 |
||||||||||||||||||||
Granted |
i 739 |
$ | i 3.58 |
i 739 |
$ | i 3.58 |
i 278 |
$ | i 2.54 |
i — |
$ | i — |
||||||||||||||||||||
Performance adjustment (1) |
i — |
$ | i — |
i 236 |
$ | i 4.01 |
i — |
$ | i — |
i — |
$ | i — |
||||||||||||||||||||
Exercised |
( i 1,881 |
) | $ | i 5.84 |
i — |
$ | i — |
( i 271 |
) | $ | i 6.98 |
( i 142 |
) | $ | i 1.31 |
|||||||||||||||||
Terminated |
( i 153 |
) | $ | i 4.56 |
( i 629 |
) | $ | i 6.45 |
i — |
$ | i — |
( i 1,532 |
) | $ | i 3.84 |
|||||||||||||||||
Balance as of January 1, 2019 |
i 2,356 |
$ | i 4.14 |
i 4,930 |
$ | i 3.30 |
i 1,266 |
$ | i 4.76 |
i 8,627 |
$ | i 3.42 |
||||||||||||||||||||
Granted |
i 1,737 |
$ | i 3.36 |
i 2,852 |
$ | i 4.61 |
i 265 |
$ | i 2.71 |
i — |
$ | i — |
||||||||||||||||||||
Performance adjustment (1) |
|
|
i — |
|
|
$ |
i — |
|
|
|
i 495 |
|
|
$ |
i 2.81 |
|
|
|
i — |
|
|
$ |
i — |
|
|
|
i — |
|
|
$ |
i — |
|
Exercised |
( i 1,401 |
) | $ | i 4.32 |
( i 3,100 |
) | $ | i 2.81 |
( i 16 |
) | $ | i 7.45 |
( i 50 |
) | $ | i 1.28 |
||||||||||||||||
Terminated |
( i 17 |
) | $ | i 7.38 |
( i 35 |
) | $ | i 2.81 |
i — |
$ | i — |
( i 426 |
) | $ | i 3.70 |
|||||||||||||||||
Balance as of December 31, 2019 |
i 2,675 |
$ | i 3.51 |
i 5,142 |
$ | i 4.28 |
i 1,515 |
$ | i 4.37 |
i 8,151 |
$ | i 3.41 |
||||||||||||||||||||
(1) |
The performance adjustment relates to additional awards expected to be earned through the achievement of certain performance metrics. |
(Shares subject to option, in thousands) |
Restricted share rights |
Long-term incentive plan |
||||||
Balance as of January 1, 2018 |
i 868 |
i 1,487 |
||||||
Granted |
i 198 |
i 709 |
||||||
Exercised |
( i 523 |
) | ( i 34 |
) | ||||
Terminated |
( i 116 |
) | ( i 335 |
) | ||||
Balance as of January 1, 2019 |
i 427 |
i 1,827 |
||||||
Granted |
i 285 |
i 801 |
||||||
Exercised |
( i 348 |
) | ( i 163 |
) | ||||
Terminated |
( i 29 |
) | ( i 576 |
) | ||||
Balance as of December 31, 2019 |
i 335 |
i 1,889 |
||||||
2019 |
||||||||||||||||||||||||
Notional amount |
Carrying amount |
Fair value |
||||||||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
||||||||||||||||||||
Assets: |
||||||||||||||||||||||||
Commercial mortgage loans |
|
) |
$ | i 6,916 |
$ | i 7,188 |
$ | i — |
$ | i — |
$ | i 7,188 |
||||||||||||
Restricted commercial mortgage loans (2) |
(1 |
) |
i 47 |
i 51 |
i — |
i — |
i 51 |
|||||||||||||||||
Other invested assets |
(1 |
) |
i 432 |
i 432 |
i — |
i 49 |
i 383 |
|||||||||||||||||
Liabilities: |
||||||||||||||||||||||||
Long-term borrowings (3) |
(1 |
) |
i 3,277 |
i 3,093 |
i — |
i 2,951 |
i 142 |
|||||||||||||||||
Non-recourse funding obligations(3) |
(1 |
) |
i 311 |
i 207 |
i — |
i — |
i 207 |
|||||||||||||||||
Investment contracts |
(1 |
) |
i 11,466 |
i 12,086 |
i — |
i — |
i 12,086 |
|||||||||||||||||
Other firm commitments: |
||||||||||||||||||||||||
Commitments to fund limited partnerships |
i 976 |
i — |
i — |
i — |
i — |
i — |
||||||||||||||||||
Commitments to fund bank loan investments |
i 52 |
i — |
i — |
i — |
i — |
i — |
||||||||||||||||||
Ordinary course of business lending commitments |
i 69 |
i — |
i — |
i — |
i — |
i — |
2018 |
||||||||||||||||||||||||
Notional amount |
Carrying amount |
Fair value |
||||||||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
||||||||||||||||||||
Assets: |
||||||||||||||||||||||||
Commercial mortgage loans |
|
) |
$ | i 6,687 |
$ | i 6,737 |
$ | i — |
$ | i — |
$ | i 6,737 |
||||||||||||
Restricted commercial mortgage loans (2) |
(1 |
) |
i 62 |
i 66 |
i — |
i — |
i 66 |
|||||||||||||||||
Other invested assets |
(1 |
) |
i 248 |
i 248 |
i — |
i — |
i 248 |
|||||||||||||||||
Liabilities: |
||||||||||||||||||||||||
Long-term borrowings (3) |
(1 |
) |
i 3,707 |
i 3,251 |
i — |
i 3,108 |
i 143 |
|||||||||||||||||
Non-recourse funding obligations(3) |
(1 |
) |
i 311 |
i 215 |
i — |
i — |
i 215 |
|||||||||||||||||
Investment contracts |
) |
i 13,105 |
i 13,052 |
i — |
i — |
i 13,052 |
||||||||||||||||||
Other firm commitments : |
||||||||||||||||||||||||
Commitments to fund limited partnership s |
i 539 |
i — |
i — |
i — |
i — |
i — |
||||||||||||||||||
Commitments to fund bank loan investments |
i 33 |
i — |
i — |
i — |
i — |
i — |
||||||||||||||||||
Ordinary course of business lending commitments |
i 73 |
i — |
i — |
i — |
i — |
i — |
(1) |
These financial instruments do not have notional amounts. |
(2) |
See note 17 for additional information relat e d to consolidated securitization entities. |
(3) |
See note 12 for additional information related to borrowings. |
• |
Third-party pricing services: |
(Amounts in millions) |
Fair value |
Primary methodologies |
Significant inputs | |||||
U.S. government, agencies and government-sponsored enterprises |
$ |
i 5,025 |
i Price quotes from trading desk, broker feeds |
i Bid side prices, trade prices, Option Adjusted Spread (“OAS”) to swap curve, Bond Market Association OAS, Treasury Curve, Agency Bullet Curve, maturity to issuer spread | ||||
State and political subdivisions |
$ |
i 2,645 |
i Multi-dimensional attribute-based modeling systems, third-party pricing vendors |
i Trade prices, material event notices, Municipal Market Data benchmark yields, broker quotes | ||||
Non-U.S. government |
$ |
i 1,335 |
i Matrix pricing, spread priced to benchmark curves, price quotes from market makers |
i Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources | ||||
U.S. corporate |
$ |
i 28,719 |
i Multi-dimensional attribute-based modeling systems, broker quotes, price quotes from market makers, OAS-based models |
i Bid side prices to Treasury Curve, Issuer Curve, which includes sector, quality, duration, OAS percentage and change for spread matrix, trade prices, comparative transactions, Trade Reporting and Compliance Engine (“TRACE”) reports | ||||
Non-U.S. corporate |
$ |
i 8,260 |
i Multi-dimensional attribute-based modeling systems, OAS-based models, price quotes from market makers |
i Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources | ||||
Residential mortgage-backed |
$ |
i 2,243 |
i OAS-based models, single factor binomial models, internally priced |
i Prepayment and default assumptions, aggregation of bonds with similar characteristics, including collateral type, vintage, tranche type, weighted-average life, weighted-average loan age, issuer program and delinquency ratio, pay up and pay down factors, TRACE reports | ||||
Commercial mortgage-backed |
$ |
i 3,020 |
i Multi-dimensional attribute-based modeling systems, pricing matrix, spread matrix priced to swap curves, Trepp commercial mortgage-backed securities analytics model |
i Credit risk, interest rate risk, prepayment speeds, new issue data, collateral performance, origination year, tranche type, original credit ratings, weighted-average life, cash flows, spreads derived from broker quotes, bid side prices, spreads to daily updated swaps curves, TRACE reports | ||||
Other asset-backed |
$ |
i 3,153 |
i Multi-dimensional attribute-based modeling systems, spread matrix priced to swap curves, price quotes from market makers |
i Spreads to daily updated swaps curves, spreads derived from trade prices and broker quotes, bid side prices, new issue data, collateral performance, analysis of prepayment speeds, cash flows, collateral loss analytics, historical issue analysis, trade data from market makers, TRACE reports |
• | Internal models: non-U.S. government, U.S. corporate and non-U.S. corporate securities are valued using internal models. The fair value of these fixed maturity securities was $ i 15 million,
$ i 1,153 million, and $ i 580
million, respectively, as of December 31, 2019. Internally modeled securities are primarily private fixed maturity securities where we use market observable inputs such as an interest rate yield curve, published credit spreads for similar securities based on the external ratings of the instrument and related industry sector of the issuer. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps and liquidity premiums are established using inputs from market participants. |
• | Internal models: non-U.S. corporate, residential mortgage-backed and other asset-backed securities are valued using internal models. The primary inputs to the valuation of the bond population include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, duration, call provisions, issuer rating, benchmark yields and credit spreads. Certain private fixed maturity securities are valued using an internal model using market observable inputs such as the interest rate yield curve, as well as published credit spreads for similar securities, which includes significant unobservable inputs. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps are established using inputs from market participants. For
structured securities, the primary inputs to the valuation include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, weighted-average coupon, weighted-average maturity, issuer rating, structure of the security, expected prepayment speeds and volumes, collateral type, current and forecasted loss severity, average delinquency rates, vintage of the loans, geographic region, debt service coverage ratios, payment priority with the tranche, benchmark yields and credit spreads. The fair value of our Level 3 fixed maturity securities priced using internal models was $ i 3,903
million as of December 31, 2019. | |
|
|
|
• | Broker quotes: non-U.S. corporate, residential mortgage-backed, commercial mortgage-backed and other asset-backed securities are valued using broker quotes. Broker quotes are obtained from third-party providers that have current market knowledge to provide a reasonable price for securities not routinely priced by third-party |
pricing services. Brokers utilized for valuation of assets are reviewed annually. The fair value of our Level 3 fixed maturity securities priced by broker quotes was $ i 288 million as of December 31, 2019. |
2019 |
||||||||||||||||||||
( Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
NAV (1) |
|||||||||||||||
Assets |
||||||||||||||||||||
Investments: |
||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||
U.S. government, agencies and government-sponsored |
$ |
i 5,025 |
$ |
i — |
$ |
i 5,025 |
$ |
i — |
$ |
i — |
||||||||||
State and political subdivisions |
i 2,747 |
i — |
i 2,645 |
i 102 |
i — |
|||||||||||||||
Non-U.S. government |
i 1,350 |
i — |
i 1,350 |
i — |
i — |
|||||||||||||||
U.S. corporate: |
||||||||||||||||||||
Utilities |
i 4,997 |
i — |
i 4,132 |
i 865 |
i — |
|||||||||||||||
Energy |
i 2,699 |
i — |
i 2,570 |
i 129 |
i — |
|||||||||||||||
Finance and insurance |
i 7,774 |
i — |
i 7,202 |
i 572 |
i — |
|||||||||||||||
Consumer—non-cyclical |
i 5,701 |
i — |
i 5,607 |
i 94 |
i — |
|||||||||||||||
Technology and communications |
i 3,245 |
i — |
i 3,195 |
i 50 |
i — |
|||||||||||||||
Industrial |
i 1,396 |
i — |
i 1,356 |
i 40 |
i — |
|||||||||||||||
Capital goods |
i 2,711 |
i — |
i 2,609 |
i 102 |
i — |
|||||||||||||||
Consumer—cyclical |
i 1,760 |
i — |
i 1,587 |
i 173 |
i — |
|||||||||||||||
Transportation |
i 1,506 |
i — |
i 1,428 |
i 78 |
i — |
|||||||||||||||
Other |
i 322 |
i — |
i 186 |
i 136 |
i — |
|||||||||||||||
Total U.S. corporate |
i 32,111 |
i — |
i 29,872 |
i 2,239 |
i — |
|||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||
Utilities |
i 829 |
i — |
i 455 |
i 374 |
i — |
|||||||||||||||
Energy |
i 1,319 |
i — |
i 1,072 |
i 247 |
i — |
|||||||||||||||
Finance and insurance |
i 2,319 |
i — |
i 2,085 |
i 234 |
i — |
|||||||||||||||
Consumer—non-cyclical |
i 684 |
i — |
i 625 |
i 59 |
i — |
|||||||||||||||
Technology and communications |
i 1,138 |
i — |
i 1,110 |
i 28 |
i — |
|||||||||||||||
Industrial |
i 988 |
i — |
i 884 |
i 104 |
i — |
|||||||||||||||
Capital goods |
i 605 |
i — |
i 444 |
i 161 |
i — |
|||||||||||||||
Consumer—cyclical |
i 397 |
i — |
i 250 |
i 147 |
i — |
|||||||||||||||
Transportation |
i 629 |
i — |
i 438 |
i 191 |
i — |
|||||||||||||||
Other |
i 1,617 |
i — |
i 1,477 |
i 140 |
i — |
|||||||||||||||
Total non-U.S. corporate |
i 10,525 |
i — |
i 8,840 |
i 1,685 |
i — |
|||||||||||||||
Residential mortgage-backed |
i 2,270 |
i — |
i 2,243 |
i 27 |
i — |
|||||||||||||||
Commercial mortgage-backed |
i 3,026 |
i — |
i 3,020 |
i 6 |
i — |
|||||||||||||||
Other asset-backed |
i 3,285 |
i — |
i 3,153 |
i 132 |
i — |
|||||||||||||||
Total fixed maturity securities |
i 60,339 |
i — |
i 56,148 |
i 4,191 |
i — |
|||||||||||||||
Equity securities |
i 239 |
i 62 |
i 126 |
i 51 |
i — |
|||||||||||||||
Other invested assets: |
||||||||||||||||||||
Derivative assets: |
||||||||||||||||||||
Interest rate swaps |
i 197 |
i — |
i 197 |
i — |
i — |
|||||||||||||||
Foreign currency swaps |
i 4 |
i — |
i 4 |
i — |
i — |
|||||||||||||||
Equity index options |
i 81 |
i — |
i — |
i 81 |
i — |
|||||||||||||||
Other foreign currency contract s |
i 8 |
i — |
i 8 |
i — |
i — |
|||||||||||||||
Total derivative assets |
i 290 |
i — |
i 209 |
i 81 |
i — |
|||||||||||||||
Securities lending collateral |
i 51 |
i — |
i 51 |
i — |
i — |
|||||||||||||||
Short-term investments |
i 211 |
i — |
i 211 |
i — |
i — |
|||||||||||||||
Limited partnerships |
i 503 |
i — |
i — |
i — |
i 503 |
|||||||||||||||
Total other invested assets |
i 1,055 |
i — |
i 471 |
i 81 |
i 503 |
|||||||||||||||
Reinsurance recoverable (2) |
i 20 |
i — |
i — |
i 20 |
i — |
|||||||||||||||
Separate account assets |
i 6,108 |
i 6,108 |
i — |
i — |
i — |
|||||||||||||||
Total assets |
$ |
i 67,761 |
$ |
i 6,170 |
$ |
i 56,745 |
$ |
i 4,343 |
$ |
i 503 |
||||||||||
(1) |
Limited partnerships that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. |
(2) |
Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
2018 |
||||||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
NAV (1) |
|||||||||||||||
Assets |
||||||||||||||||||||
Investments: |
||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||
U.S. government, agencies and government-sponsored |
$ |
i 4,631 |
$ |
i — |
$ |
i 4,631 |
$ |
i — |
$ |
i — |
||||||||||
State and political subdivisions |
i 2,552 |
i — |
i 2,501 |
i 51 |
i — |
|||||||||||||||
Non-U.S. government |
i 1,268 |
i — |
i 1,268 |
i — |
i — |
|||||||||||||||
U.S. corporate: |
|
|||||||||||||||||||
Utilities |
i 4,675 |
i — |
i 4,032 |
i 643 |
i — |
|||||||||||||||
Energy |
i 2,412 |
i — |
i 2,291 |
i 121 |
i — |
|||||||||||||||
Finance and insurance |
i 6,808 |
i — |
i 6,274 |
i 534 |
i — |
|||||||||||||||
Consumer—non-cyclical |
i 5,036 |
i — |
i 4,963 |
i 73 |
i — |
|||||||||||||||
Technology and communications |
i 2,841 |
i — |
i 2,791 |
i 50 |
i — |
|||||||||||||||
Industrial |
i 1,221 |
i — |
i 1,182 |
i 39 |
i — |
|||||||||||||||
Capital goods |
i 2,391 |
i — |
i 2,299 |
i 92 |
i — |
|||||||||||||||
Consumer—cyclical |
i 1,597 |
i — |
i 1,386 |
i 211 |
i — |
|||||||||||||||
Transportation |
i 1,320 |
i — |
i 1,263 |
i 57 |
i — |
|||||||||||||||
Other |
i 397 |
i — |
i 219 |
i 178 |
i — |
|||||||||||||||
Total U.S. corporate |
i 28,698 |
i — |
i 26,700 |
i 1,998 |
i — |
|||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||
Utilities |
i 821 |
i — |
i 417 |
i 404 |
i — |
|||||||||||||||
Energy |
i 1,221 |
i — |
i 1,004 |
i 217 |
i — |
|||||||||||||||
Finance and insurance |
i 2,106 |
i — |
i 1,935 |
i 171 |
i — |
|||||||||||||||
Consumer—non-cyclical |
i 690 |
i — |
i 584 |
i 106 |
i — |
|||||||||||||||
Technology and communications |
i 1,040 |
i — |
i 1,014 |
i 26 |
i — |
|||||||||||||||
Industrial |
i 916 |
i — |
i 855 |
i 61 |
i — |
|||||||||||||||
Capital goods |
i 572 |
i — |
i 399 |
i 173 |
i — |
|||||||||||||||
Consumer—cyclical |
i 313 |
i — |
i 191 |
i 122 |
i — |
|||||||||||||||
Transportation |
i 610 |
i — |
i 439 |
i 171 |
i — |
|||||||||||||||
Other |
i 1,481 |
i — |
i 1,400 |
i 81 |
i — |
|||||||||||||||
Total non-U.S. corporate |
i 9,770 |
i — |
i 8,238 |
i 1,532 |
i — |
|||||||||||||||
Residential mortgage-backed |
i 2,618 |
i — |
i 2,583 |
i 35 |
i — |
|||||||||||||||
Commercial mortgage-backed |
i 3,016 |
i — |
i 2,921 |
i 95 |
i — |
|||||||||||||||
Other asset-backed |
i 3,036 |
i — |
i 2,882 |
i 154 |
i — |
|||||||||||||||
Total fixed maturity securities |
i 55,589 |
i — |
i 51,724 |
i 3,865 |
i — |
|||||||||||||||
Equity securities |
i 275 |
i 153 |
i 64 |
i 58 |
i — |
|||||||||||||||
Other invested assets: |
||||||||||||||||||||
Derivative assets: |
||||||||||||||||||||
Interest rate swaps |
i 42 |
i — |
i 42 |
i — |
i — |
|||||||||||||||
Foreign currency swaps |
i 6 |
i — |
i 6 |
i — |
i — |
|||||||||||||||
Equity index options |
i 39 |
i — |
i — |
i 39 |
i — |
|||||||||||||||
Other foreign currency contracts |
i 10 |
i — |
i 10 |
i — |
i — |
|||||||||||||||
Total derivative assets |
i 97 |
i — |
i 58 |
i 39 |
i — |
|||||||||||||||
Securities lending collateral |
i 102 |
i — |
i 102 |
i — |
i — |
|||||||||||||||
Short-term investments |
i 195 |
i — |
i 195 |
i — |
i — |
|||||||||||||||
Limited partnerships |
i 318 |
i — |
i — |
i — |
i 318 |
|||||||||||||||
Total other invested assets |
i 712 |
i — |
i 355 |
i 39 |
i 318 |
|||||||||||||||
Reinsurance recoverable (2) |
i 20 |
i — |
i — |
i 20 |
i — |
|||||||||||||||
Separate account assets |
i 5,859 |
i 5,859 |
i — |
i — |
i — |
|||||||||||||||
Total assets |
$ |
i 62,455 |
$ |
i 6,012 |
$ |
i 52,143 |
$ |
i 3,982 |
$ |
i 318 |
||||||||||
(1) |
Limited partnerships that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. |
(2) |
Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
|
Total realized and unrealized gains (losses) |
Transfer into Level 3 (1) |
Transfer out of Level 3 (1) |
Ending balance as of December 31, 2019 |
Total gains (losses) included in net income attributable to assets still held |
|||||||||||||||||||||||||||||||||||||||
Included in income |
Included in OCI |
Purchases |
Sales |
Issuances |
Settlements |
|||||||||||||||||||||||||||||||||||||||
(Amounts in millions) |
||||||||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||||||||||||||||||||||
State and political subdivisions |
$ | i 51 |
$ | i 3 |
$ | i 20 |
$ | i — |
$ | i — |
$ | i — |
$ | i — |
$ | i 28 |
$ | i — |
$ | i 102 |
$ | i 3 |
||||||||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||||||||||||||||||||||
Utilities |
i 643 |
i 1 |
i 72 |
i 156 |
( i 14 |
) | i — |
( i 49 |
) | i 72 |
( i 16 |
) | i 865 |
i — |
||||||||||||||||||||||||||||||
Energy |
i 121 |
i — |
i 9 |
i 17 |
( i 5 |
) | i — |
( i 13 |
) | i — |
i — |
i 129 |
i — |
|||||||||||||||||||||||||||||||
Finance and insurance |
i 534 |
i — |
i 51 |
i 50 |
i — |
i — |
( i 39 |
) | i 35 |
( i 59 |
) | i 572 |
i — |
|||||||||||||||||||||||||||||||
Consumer—non-cyclical |
i 73 |
i — |
i 5 |
i 23 |
( i 5 |
) | i — |
( i 11 |
) | i 9 |
i — |
i 94 |
i — |
|||||||||||||||||||||||||||||||
Technology and |
i 50 |
i — |
i 7 |
i — |
i — |
i — |
( i 1 |
) | i 5 |
( i 11 |
) | i 50 |
i — |
|||||||||||||||||||||||||||||||
Industrial |
i 39 |
i — |
i 1 |
i — |
i — |
i — |
i — |
i — |
i — |
i 40 |
i — |
|||||||||||||||||||||||||||||||||
Capital goods |
i 92 |
i — |
i 10 |
i — |
i — |
i — |
i — |
i — |
i — |
i 102 |
i — |
|||||||||||||||||||||||||||||||||
Consumer—cyclical |
i 211 |
i — |
i 11 |
i — |
( i 13 |
) | i — |
( i 18 |
) | i — |
( i 18 |
) | i 173 |
( i 1 |
) | |||||||||||||||||||||||||||||
Transportation |
i 57 |
i — |
i 3 |
i 39 |
i — |
i — |
( i 10 |
) | i — |
( i 11 |
) | i 78 |
i — |
|||||||||||||||||||||||||||||||
Other |
i 178 |
i — |
i 6 |
i 23 |
i — |
i — |
( i 20 |
) | i 8 |
( i 59 |
) | i 136 |
i — |
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Total U.S. corporate |
i 1,998 |
i 1 |
i 175 |
i 308 |
( i 37 |
) |
i — |
( i 161 |
) |
i 129 |
( i 174 |
) |
i 2,239 |
( i 1 |
) | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||||||||||||||||||||||
Utilities |
i 404 |
i — |
i 30 |
i 30 |
( i 7 |
) | i — |
( i 67 |
) | i — |
( i 16 |
) | i 374 |
i — |
||||||||||||||||||||||||||||||
Energy |
i 217 |
( i 1 |
) | i 19 |
i 46 |
( i 18 |
) | i — |
( i 16 |
) | i — |
i — |
i 247 |
i — |
||||||||||||||||||||||||||||||
Finance and insurance |
i 171 |
i 4 |
i 23 |
i 7 |
i — |
i — |
( i 16 |
) | i 54 |
( i 9 |
) | i 234 |
i 4 |
|||||||||||||||||||||||||||||||
Consumer—non-cyclical |
i 106 |
i 2 |
i 5 |
i 1 |
i — |
i — |
( i 55 |
) | i — |
i — |
i 59 |
i — |
||||||||||||||||||||||||||||||||
Techno communicationslog y and |
i 26 |
i — |
i 2 |
i — |
i — |
i — |
i — |
i — |
i — |
i 28 |
i — |
|||||||||||||||||||||||||||||||||
Industrial |
i 61 |
i — |
i 5 |
i 38 |
i — |
i — |
i — |
i — |
i — |
i 104 |
i — |
|||||||||||||||||||||||||||||||||
Capital goods |
i 173 |
i — |
i 12 |
i 10 |
i — |
i — |
( i 16 |
) | i 3 |
( i 21 |
) | i 161 |
i — |
|||||||||||||||||||||||||||||||
Consumer—cyclical |
i 122 |
i — |
i 12 |
i 16 |
i — |
i — |
( i 3 |
) | i — |
i — |
i 147 |
i — |
||||||||||||||||||||||||||||||||
Transportation |
i 171 |
i — |
i 10 |
i 27 |
i — |
i — |
i — |
i — |
( i 17 |
) | i 191 |
i — |
||||||||||||||||||||||||||||||||
Other |
i 81 |
i — |
i 12 |
i 43 |
i — |
i — |
( i 2 |
) | i 6 |
i — |
i 140 |
i — |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Total non-U.S. corporate |
i 1,532 |
i 5 |
i 130 |
i 218 |
( i 25 |
) | i — |
( i 175 |
) | i 63 |
( i 63 |
) | i 1,685 |
i 4 |
||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Residential mortgage-backed |
i 35 |
i — |
i 1 |
i — |
( i 2 |
) | i — |
( i 1 |
) | i — |
( i 6 |
) | i 27 |
i — |
||||||||||||||||||||||||||||||
Commercial mortgage-backed |
i 95 |
i — |
i 17 |
i 3 |
i — |
i — |
i — |
i 1 |
( i 110 |
) | i 6 |
i — |
||||||||||||||||||||||||||||||||
Other asset-backed |
i 154 |
i — |
i 3 |
i 139 |
i — |
i — |
( i 69 |
) | i 28 |
( i 123 |
) | i 132 |
i — |
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Total fixed maturity securities |
i 3,865 |
i 9 |
i 346 |
i 668 |
( i 64 |
) | i — |
( i 406 |
) | i 249 |
( i 476 |
) | i 4,191 |
i 6 |
||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Equity securities |
i 58 |
i — |
i — |
i 2 |
( i 9 |
) | i — |
i — |
i — |
i — |
i 51 |
i — |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Other invested assets: |
||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: |
||||||||||||||||||||||||||||||||||||||||||||
Equity index options |
i 39 |
i 43 |
i — |
i 63 |
i — |
i — |
( i 64 |
) | i — |
i — |
i 81 |
i 18 |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Total derivative assets |
i 39 |
i 43 |
i — |
i 63 |
i — |
i — |
( i 64 |
) | i — |
i — |
i 81 |
i 18 |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Total other invested assets |
i 39 |
i 43 |
i — |
i 63 |
i — |
i — |
( i 64 |
) | i — |
i — |
i 81 |
i 18 |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
Reinsurance recoverable (2) |
i 20 |
( i 1 |
) | i — |
i — |
i — |
i 1 |
i — |
i — |
i — |
i 20 |
( i 1 |
) | |||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||
Total Level 3 assets |
$ | i 3,982 |
$ | i 51 |
$ | i 346 |
$ | i 733 |
$ | ( i 73 |
) | $ | i 1 |
$ | ( i 470 |
) | $ | i 249 |
$ | ( i 476 |
) | $ | i 4,343 |
$ | i 23 |
|||||||||||||||||||
(1) |
The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) |
Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
(Amounts in millions) |
Beginning balance as |
Total realized and unrealized gains (losses) |
Transfer into Level 3 (1) |
Transfer out of Level 3 (1) |
Ending balance as of December 31, 2018 |
Total gains (losses) included in net income attributable to assets still held |
||||||||||||||||||||||||||||||||||||||
Included net |
Included in OCI |
Purchases |
Sales |
Issuances |
Settlements |
|||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||||||||||||||||||||||
U.S. government, agencies and |
$ |
i 1 |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
( i 1 |
) |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i — |
|||||||||||||||||||||
State and political subdivisions |
i 37 |
i 3 |
i 4 |
i — |
i — |
i — |
i — |
i 18 |
( i 11 |
) |
i 51 |
i 3 |
||||||||||||||||||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||||||||||||||||||||||
Utilities |
i 574 |
( i 1 |
) |
( i 40 |
) |
i 111 |
( i 12 |
) |
i — |
( i 6 |
) |
i 55 |
( i 38 |
) |
i 643 |
i — |
||||||||||||||||||||||||||||
Energy |
i 147 |
i — |
( i 7 |
) |
i 22 |
i — |
i — |
( i 34 |
) |
i — |
( i 7 |
) |
i 121 |
i — |
||||||||||||||||||||||||||||||
Finance and insurance |
i 626 |
i — |
( i 77 |
) |
i 84 |
i — |
i — |
( i 122 |
) |
i 49 |
( i 26 |
) |
i 534 |
i 1 |
||||||||||||||||||||||||||||||
Consumer—non-cyclical |
i 81 |
i — |
( i 3 |
) |
i — |
i — |
i — |
( i 5 |
) |
i — |
i — |
i 73 |
i — |
|||||||||||||||||||||||||||||||
Technology and |
i 73 |
i — |
( i 6 |
) |
i 20 |
i — |
i — |
( i 60 |
) |
i 31 |
( i 8 |
) |
i 50 |
i — |
||||||||||||||||||||||||||||||
Industrial |
i 39 |
i — |
i — |
i — |
i — |
i — |
i — |
i — |
i — |
i 39 |
i — |
|||||||||||||||||||||||||||||||||
Capital goods |
i 121 |
i — |
( i 10 |
) |
i 33 |
i — |
i — |
( i 45 |
) |
i — |
( i 7 |
) |
i 92 |
i — |
||||||||||||||||||||||||||||||
Consumer—cyclical |
i 262 |
i — |
( i 12 |
) |
i 17 |
( i 5 |
) |
i — |
( i 19 |
) |
i — |
( i 32 |
) |
i 211 |
i — |
|||||||||||||||||||||||||||||
Transportation |
i 60 |
i — |
( i 2 |
) |
i 3 |
i — |
i — |
( i 4 |
) |
i — |
i — |
i 57 |
i — |
|||||||||||||||||||||||||||||||
Other |
i 169 |
i — |
( i 3 |
) |
i — |
( i 10 |
) |
i — |
( i 8 |
) |
i 30 |
i — |
i 178 |
i — |
||||||||||||||||||||||||||||||
Total U.S. corporate |
i 2,152 |
( i 1 |
) |
( i 160 |
) |
i 290 |
( i 27 |
) |
i — |
( i 303 |
) |
i 165 |
( i 118 |
) |
i 1,998 |
i 1 |
||||||||||||||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||||||||||||||||||||||
Utilities |
i 343 |
i — |
( i 19 |
) |
i 52 |
i — |
i — |
( i 20 |
) |
i 69 |
( i 21 |
) |
i 404 |
i — |
||||||||||||||||||||||||||||||
Energy |
i 176 |
i — |
( i 9 |
) |
i 53 |
i — |
i — |
( i 29 |
) |
i 26 |
i — |
i 217 |
i — |
|||||||||||||||||||||||||||||||
Finance and insurance |
i 161 |
i 4 |
( i 13 |
) |
i 6 |
i — |
i — |
( i 2 |
) |
i 16 |
( i 1 |
) |
i 171 |
i 4 |
||||||||||||||||||||||||||||||
Consumer— |
i 124 |
i — |
( i 5 |
) |
i — |
i — |
i — |
( i 20 |
) |
i 7 |
i — |
i 106 |
i — |
|||||||||||||||||||||||||||||||
Technology and |
i 29 |
i — |
i — |
i 10 |
i — |
i — |
( i 13 |
) |
i — |
i — |
i 26 |
i — |
||||||||||||||||||||||||||||||||
Industrial |
i 116 |
i — |
( i 5 |
) |
i 3 |
i — |
i — |
( i 10 |
) |
i — |
( i 43 |
) |
i 61 |
i — |
||||||||||||||||||||||||||||||
Capital goods |
i 191 |
i 1 |
( i 8 |
) |
i 15 |
i — |
i — |
( i 26 |
) |
i — |
i — |
i 173 |
i 1 |
|||||||||||||||||||||||||||||||
Consumer— |
i 54 |
i — |
( i 5 |
) |
i 30 |
( i 1 |
) |
i — |
( i 3 |
) |
i 48 |
( i 1 |
) |
i 122 |
i — |
|||||||||||||||||||||||||||||
Transportation |
i 170 |
( i 2 |
) |
( i 9 |
) |
i 45 |
( i 18 |
) |
i — |
i — |
i 18 |
( i 33 |
) |
i 171 |
i — |
|||||||||||||||||||||||||||||
Other |
i 52 |
i — |
( i 4 |
) |
i 33 |
i — |
i — |
i — |
i — |
i — |
i 81 |
i — |
||||||||||||||||||||||||||||||||
Total non-U.S. corporate |
i 1,416 |
i 3 |
( i 77 |
) |
i 247 |
( i 19 |
) |
i — |
( i 123 |
) |
i 184 |
( i 99 |
) |
i 1,532 |
i 5 |
|||||||||||||||||||||||||||||
Residential mortgage-backed |
i 77 |
i — |
i — |
i 37 |
i — |
i — |
( i 1 |
) |
i 14 |
( i 92 |
) |
i 35 |
i — |
|||||||||||||||||||||||||||||||
Commercial mortgage-backed |
i 30 |
i — |
( i 4 |
) |
i 70 |
i — |
i — |
i — |
i 31 |
( i 32 |
) |
i 95 |
i — |
|||||||||||||||||||||||||||||||
Other asset-backed |
i 227 |
i — |
( i 3 |
) |
i 114 |
( i 16 |
) |
i — |
( i 93 |
) |
i 54 |
( i 129 |
) |
i 154 |
i — |
|||||||||||||||||||||||||||||
Total fixed maturity securities |
i 3,940 |
i 5 |
( i 240 |
) |
i 758 |
( i 62 |
) |
i — |
( i 521 |
) |
i 466 |
( i 481 |
) |
i 3,865 |
i 9 |
|||||||||||||||||||||||||||||
Equity securities |
i 44 |
i — |
i — |
i 18 |
( i 4 |
) |
i — |
i — |
i — |
i — |
i 58 |
i — |
||||||||||||||||||||||||||||||||
Other invested assets: |
||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: |
||||||||||||||||||||||||||||||||||||||||||||
Equity index options |
i 80 |
( i 34 |
) |
i — |
i 74 |
i — |
i — |
( i 81 |
) |
i — |
i — |
i 39 |
( i 26 |
) | ||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||
Total derivative assets |
i 80 |
( i 34 |
) |
i — |
i 74 |
i — |
i — |
( i 81 |
) |
i — |
i — |
i 39 |
( i 26 |
) | ||||||||||||||||||||||||||||||
Total other invested assets |
i 80 |
( i 34 |
) |
i — |
i 74 |
i — |
i — |
( i 81 |
) |
i — |
i — |
i 39 |
( i 26 |
) | ||||||||||||||||||||||||||||||
Reinsurance recoverable (2) |
i 14 |
i 5 |
i — |
i — |
i — |
i 1 |
i — |
i — |
i — |
i 20 |
i 5 |
|||||||||||||||||||||||||||||||||
Total Level 3 assets |
$ |
i 4,078 |
$ |
( i 24 |
) |
$ |
( i 240 |
) |
$ |
i 850 |
$ |
( i 66 |
) |
$ |
i 1 |
$ |
( i 602 |
) |
$ |
i 466 |
$ |
( i 481 |
) |
$ |
i 3,982 |
$ |
( i 12 |
) | ||||||||||||||||
(1) |
The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) |
Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
(Amounts in millions) |
Beginning balance as |
Total realized and unrealized gains (losses) |
Transfer into Level 3 (1) |
Transfer out of Level 3 (1) |
Ending balance as of |
Total gains (losses) included in net income attributable to assets still held |
||||||||||||||||||||||||||||||||||||||
Included |
Included in OCI |
Purchases |
Sales |
Issuances |
Settlements |
|||||||||||||||||||||||||||||||||||||||
Fixed maturity securities: |
||||||||||||||||||||||||||||||||||||||||||||
U.S. government, agencies and - sponsored enterprises |
$ |
i 2 |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
( i 1 |
) |
$ |
i — |
$ |
i — |
$ |
i 1 |
$ |
i — |
|||||||||||||||||||||
State and political subdivisions |
i 37 |
i 3 |
( i 3 |
) |
i — |
i — |
i — |
i — |
i — |
i — |
i 37 |
i 3 |
||||||||||||||||||||||||||||||||
U.S. corporate: |
||||||||||||||||||||||||||||||||||||||||||||
Utilities |
i 576 |
i — |
i 24 |
i 76 |
i — |
i — |
( i 11 |
) |
i 30 |
( i 121 |
) |
i 574 |
i — |
|||||||||||||||||||||||||||||||
Energy |
i 210 |
i — |
i 5 |
i 10 |
( i 31 |
) |
i — |
( i 32 |
) |
i 1 |
( i 16 |
) |
i 147 |
( i 1 |
) | |||||||||||||||||||||||||||||
Finance and insurance |
i 786 |
i 20 |
i 5 |
i 79 |
( i 31 |
) |
i — |
( i 206 |
) |
i 8 |
( i 35 |
) |
i 626 |
i 11 |
||||||||||||||||||||||||||||||
Consumer—non-cyclical |
i 121 |
i — |
i 2 |
i 4 |
i — |
i — |
( i 8 |
) |
i — |
( i 38 |
) |
i 81 |
i — |
|||||||||||||||||||||||||||||||
Technology and |
i 54 |
i 3 |
i 7 |
i 31 |
i — |
i — |
( i 1 |
) |
i — |
( i 21 |
) |
i 73 |
i 3 |
|||||||||||||||||||||||||||||||
Industrial |
i 48 |
i 1 |
( i 1 |
) |
i 13 |
i — |
i — |
( i 8 |
) |
i — |
( i 14 |
) |
i 39 |
i — |
||||||||||||||||||||||||||||||
Capital goods |
i 152 |
i 1 |
i 3 |
i 7 |
i — |
i — |
( i 5 |
) |
i — |
( i 37 |
) |
i 121 |
i 1 |
|||||||||||||||||||||||||||||||
Consumer—cyclical |
i 258 |
i — |
i 9 |
i 12 |
i — |
i — |
( i 15 |
) |
i — |
( i 2 |
) |
i 262 |
i — |
|||||||||||||||||||||||||||||||
Transportation |
i 139 |
i 16 |
( i 5 |
) |
i — |
i — |
i — |
( i 48 |
) |
i — |
( i 42 |
) |
i 60 |
i 1 |
||||||||||||||||||||||||||||||
Other |
i 143 |
i — |
i 2 |
i — |
( i 5 |
) |
i — |
( i 8 |
) |
i 37 |
i — |
i 169 |
i — |
|||||||||||||||||||||||||||||||
Total U.S. corporate |
i 2,487 |
i 41 |
i 51 |
i 232 |
( i 67 |
) |
i — |
( i 342 |
) |
i 76 |
( i 326 |
) |
i 2,152 |
i 15 |
||||||||||||||||||||||||||||||
Non-U.S. corporate: |
||||||||||||||||||||||||||||||||||||||||||||
Utilities |
i 386 |
i — |
i 3 |
i 30 |
i — |
i — |
i — |
i — |
( i 76 |
) |
i 343 |
i — |
||||||||||||||||||||||||||||||||
Energy |
i 206 |
i — |
i 5 |
i — |
( i 1 |
) |
i — |
( i 1 |
) |
i — |
( i 33 |
) |
i 176 |
i — |
||||||||||||||||||||||||||||||
Finance and insurance |
i 182 |
i 5 |
i 10 |
i 5 |
i — |
i — |
( i 32 |
) |
i — |
( i 9 |
) |
i 161 |
i 3 |
|||||||||||||||||||||||||||||||
Consumer—non-cyclical |
i 139 |
i — |
i 2 |
i 5 |
i — |
i — |
( i 22 |
) |
i — |
i — |
i 124 |
i — |
||||||||||||||||||||||||||||||||
Technology and |
i 67 |
i 1 |
i 1 |
i — |
( i 21 |
) |
i — |
( i 19 |
) |
i — |
i — |
i 29 |
i — |
|||||||||||||||||||||||||||||||
Industrial |
i 109 |
i — |
i 3 |
i 13 |
i — |
i — |
i — |
i 14 |
( i 23 |
) |
i 116 |
i — |
||||||||||||||||||||||||||||||||
Capital goods |
i 169 |
i — |
i 3 |
i 52 |
i — |
i — |
( i 25 |
) |
i — |
( i 8 |
) |
i 191 |
i — |
|||||||||||||||||||||||||||||||
Consumer—cyclical |
i 69 |
i — |
i — |
i — |
i — |
i — |
( i 17 |
) |
i 2 |
i — |
i 54 |
i — |
||||||||||||||||||||||||||||||||
Transportation |
i 181 |
i 1 |
i 2 |
i 6 |
( i 10 |
) |
i — |
( i 10 |
) |
i 11 |
( i 11 |
) |
i 170 |
i — |
||||||||||||||||||||||||||||||
Other |
i 25 |
( i 2 |
) |
i 2 |
i 15 |
( i 2 |
) |
i — |
i — |
i 25 |
( i 11 |
) |
i 52 |
i — |
||||||||||||||||||||||||||||||
Total non-U.S. corporate |
i 1,533 |
i 5 |
i 31 |
i 126 |
( i 34 |
) |
i — |
( i 126 |
) |
i 52 |
( i 171 |
) |
i 1,416 |
i 3 |
||||||||||||||||||||||||||||||
Residential mortgage-backed |
i 43 |
i — |
i — |
i 35 |
i — |
i — |
( i 3 |
) |
i 26 |
( i 24 |
) |
i 77 |
i — |
|||||||||||||||||||||||||||||||
Commercial mortgage-backed |
i 54 |
( i 2 |
) |
i 4 |
i 31 |
( i 9 |
) |
i — |
i — |
i — |
( i 48 |
) |
i 30 |
i — |
||||||||||||||||||||||||||||||
Other asset-backed |
i 145 |
( i 8 |
) |
i 11 |
i 123 |
( i 35 |
) |
i — |
( i 23 |
) |
i 69 |
( i 55 |
) |
i 227 |
i — |
|||||||||||||||||||||||||||||
Total fixed maturity securities |
i 4,301 |
i 39 |
i 94 |
i 547 |
( i 145 |
) |
i — |
( i 495 |
) |
i 223 |
( i 624 |
) |
i 3,940 |
i 21 |
||||||||||||||||||||||||||||||
Equity securities |
i 47 |
i — |
i — |
i 1 |
( i 1 |
) |
i — |
i — |
i — |
( i 3 |
) |
i 44 |
i — |
|||||||||||||||||||||||||||||||
Other invested assets: |
||||||||||||||||||||||||||||||||||||||||||||
Derivative assets: |
||||||||||||||||||||||||||||||||||||||||||||
Equity index options |
i 72 |
i 57 |
i — |
i 72 |
i — |
i — |
( i 121 |
) |
i — |
i — |
i 80 |
i 36 |
||||||||||||||||||||||||||||||||
|
i 3 |
( i 3 |
) |
— |
— |
— |
— |
— |
— |
— |
— |
( i 2 |
) | |||||||||||||||||||||||||||||||
Total derivative assets |
i 75 |
i 54 |
i — |
i 72 |
i — |
i — |
( i 121 |
) |
i — |
i — |
i 80 |
i 34 |
||||||||||||||||||||||||||||||||
Total other invested assets |
i 75 |
i 54 |
i — |
i 72 |
i — |
i — |
( i 121 |
) |
i — |
i — |
i 80 |
i 34 |
||||||||||||||||||||||||||||||||
Restricted other invested assets securitization entities (2) |
i 131 |
— |
— |
— |
( i 131 |
) |
— |
— |
— |
— |
— |
— |
||||||||||||||||||||||||||||||||
Reinsurance recoverable (3) |
i 16 |
( i 4 |
) |
i — |
i — |
i — |
i 2 |
i — |
i — |
i — |
i 14 |
( i 4 |
) | |||||||||||||||||||||||||||||||
Total Level 3 assets |
$ |
i 4,570 |
$ |
i 89 |
$ |
i 94 |
$ |
i 620 |
$ |
( i 277 |
) |
$ |
i 2 |
$ |
( i 616 |
) |
$ |
i 223 |
$ |
( i 627 |
) |
$ |
i 4,078 |
$ |
i 51 |
|||||||||||||||||||
(1) |
The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads, as well as changes in the industry sectors assigned to specific securities. |
(2) |
See note 17 for additional information related to consolidated securitization entities. |
(3) |
Represents embedded derivatives associated with the reinsured portion of our GMWB liabilities. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Total realized and unrealized gains (losses) included in net income: |
||||||||||||
Net investment income |
$ | i 10 |
$ | i 8 |
$ | i 26 |
||||||
Net investment gains (losses) |
i 41 |
( i 32 |
) | i 63 |
||||||||
Total |
$ | i 51 |
$ | ( i 24 |
) | $ | i 89 |
|||||
Total gains (losses) included in net income attributable to assets still held: |
||||||||||||
Net investment income |
$ | i 6 |
$ | i 9 |
$ | i 22 |
||||||
Net investment gains (losses) |
i 17 |
( i 21 |
) | i 29 |
||||||||
Total |
$ | i 23 |
$ | ( i 12 |
) | $ | i 51 |
|||||
(Amounts in millions) |
Valuation technique |
Fair value |
Unobservable input |
Range |
Weighted- average |
|||||||||
Fixed maturity securities: |
||||||||||||||
U.S. corporate: |
||||||||||||||
Utilities |
i Internal models |
$ |
i 790 |
Credit spreads |
i 48bps - i 327bps
|
i 130bps |
||||||||
Energy |
i Internal models |
i 105 |
Credit spreads |
i 67bps - i 264bps
|
i 152bps |
|||||||||
Finance and insurance |
i Internal models |
i 556 |
Credit spreads |
i 54bps - i 207bps
|
i 129bps |
|||||||||
Consumer—non-cyclical |
i Internal models |
i 94 |
Credit spreads |
i 71bps - i 264bps
|
i 136bps |
|||||||||
Technology and communications |
i Internal models |
i 50 |
Credit spreads |
i 115bps - i 264bps
|
i 193bps |
|||||||||
Industrial |
i Internal models |
i 40 |
Credit spreads |
i 114bps - i 144bps
|
i 127bps |
|||||||||
Capital goods |
i Internal models |
i 102 |
Credit spreads |
i 78bps - i 198bps
|
i 128bps |
|||||||||
Consumer—cyclical |
i Internal models |
i 119 |
Credit spreads |
i 79bps - i 223bps
|
i 125bps |
|||||||||
Transportation |
i Internal models |
i 78 |
Credit spreads |
i 50bps - i 198bps
|
i 110bps |
|||||||||
Other |
i Internal models |
i 136 |
Credit spreads |
i 65bps - i 121bps
|
i 73bps |
|||||||||
Total U.S. corporate |
i Internal models |
$ |
i 2,070 |
Credit spreads |
i 48bps - i 327bps
|
i 128bps |
||||||||
Non-U.S. corporate: |
||||||||||||||
Utilities |
i Internal models |
$ |
i 374 |
Credit spreads |
i 67bps - i 189bps
|
i 126bps |
||||||||
Energy |
i Internal models |
i 235 |
Credit spreads |
i 78bps - i 261bps
|
i 139bps |
|||||||||
Finance and insurance |
i Internal models |
i 234 |
Credit spreads |
i 86bps - i 193bps
|
i 118bps |
|||||||||
Consumer—non-cyclical |
i Internal models |
i 58 |
Credit spreads |
i 60bps - i 122bps
|
i 98bps |
|||||||||
Technology and communications |
i Internal models |
i 28 |
Credit spreads |
i 98bps - i 115bps
|
i 109bps |
|||||||||
Industrial |
i Internal models |
i 104 |
Credit spreads |
i 67bps - i 198bps
|
i 118bps |
|||||||||
Capital goods |
i Internal models |
i 161 |
Credit spreads |
i 71bps - i 186bps
|
i 131bps |
|||||||||
Consumer—cyclical |
i Internal models |
i 143 |
Credit spreads |
i 64bps - i 261bps
|
i 175bps |
|||||||||
Transportation |
i Internal models |
i 191 |
Credit spreads |
i 60bps - i 261bps
|
i 114bps |
|||||||||
Other |
i Internal models |
i 140 |
Credit spreads |
i 77bps - i 295bps
|
i 148bps |
|||||||||
Total non-U.S. corporate |
i Internal models |
$ |
i 1,668 |
Credit spreads |
i 60bps - i 295bps
|
i 130bps |
||||||||
Derivative assets: |
||||||||||||||
Equity index options |
i Discounted cash flows |
$ |
i 81 |
Equity index volatility |
i 6% - i 36%
|
i 17 |
% |
2019 |
||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
||||||||||||
Liabilities |
||||||||||||||||
Policyholder account balances: |
||||||||||||||||
GMWB embedded derivatives (1) |
$ | i 323 |
$ | i — |
$ | i — |
$ | i 323 |
||||||||
Fixed index annuity embedded derivatives |
i 452 |
i — |
i — |
i 452 |
||||||||||||
Indexed universal life embedded derivatives |
i 19 |
i — |
i — |
i 19 |
||||||||||||
Total policyholder account balances |
i 794 |
i — |
i — |
i 794 |
||||||||||||
Derivative liabilities: |
||||||||||||||||
Interest rate swaps |
i 10 |
i — |
i 10 |
i — |
||||||||||||
Other foreign currency contracts |
i 1 |
i — |
i 1 |
i — |
||||||||||||
Total derivative liabilities |
i 11 |
i — |
i 11 |
i — |
||||||||||||
Total liabilities |
$ | i 805 |
$ | i — |
$ | i 11 |
$ | i 794 |
||||||||
(1) |
Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
2018 |
||||||||||||||||
(Amounts in millions) |
Total |
Level 1 |
Level 2 |
Level 3 |
||||||||||||
Liabilities |
||||||||||||||||
Policyholder account balances: |
||||||||||||||||
GMWB embedded derivatives (1) |
$ | i 337 |
$ | i — |
$ | i — |
$ | i 337 |
||||||||
Fixed index annuity embedded derivatives |
i 389 |
i — |
i — |
i 389 |
||||||||||||
Indexed universal life embedded derivatives |
i 12 |
i — |
i — |
i 12 |
||||||||||||
Total policyholder account balances |
i 738 |
i — |
i — |
i 738 |
||||||||||||
Derivative liabilities: |
||||||||||||||||
Interest rate swaps |
i 102 |
i — |
i 102 |
i — |
||||||||||||
Other foreign currency contracts |
i 7 |
i — |
i 7 |
i — |
||||||||||||
Total derivative liabilities |
i 109 |
i — |
i 109 |
i — |
||||||||||||
Total liabilities |
$ | i 847 |
$ | i — |
$ | i 109 |
$ | i 738 |
||||||||
(1) |
Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
|
Beginning balance as of |
Total realized and unrealized (gains) losses |
|
|
|
|
Transfer into Level 3 |
Transfer out of Level 3 |
Ending balance as of |
Total (gains) losses included in net (income) attributable to liabilities still held |
||||||||||||||||||||||||||||||||||
(Amounts in millions) |
Included in net (income) |
Included in OCI |
Purchases |
Sales |
Issuances |
Settlements |
||||||||||||||||||||||||||||||||||||||
Policyholder account balances: |
||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded derivatives (1) |
$ |
i 337 |
$ |
( i 39 |
) |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i 25 |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i 323 |
$ |
( i 34 |
) | ||||||||||||||||||||
Fixed index annuity embedded derivatives |
i 389 |
i 90 |
i — |
i — |
i — |
i — |
( i 27 |
) |
i — |
i — |
i 452 |
i 90 |
||||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives |
i 12 |
( i 4 |
) |
i — |
i — |
i — |
i 11 |
i — |
i — |
i — |
i 19 |
( i 4 |
) | |||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||
Total policyholder account balances |
i 738 |
i 47 |
i — |
i — |
i — |
i 36 |
( i 27 |
) |
i — |
i — |
i 794 |
i 52 |
||||||||||||||||||||||||||||||||
Total Level 3 liabilities |
$ |
i 738 |
$ |
i 47 |
$ |
i — |
$ |
i — |
$ |
i — |
$ |
i 36 |
$ |
( i 27 |
) |
$ |
i — |
$ |
i — |
$ |
i 794 |
$ |
i 52 |
|||||||||||||||||||||
(1) |
Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance . |
|
Beginning balance as of |
Total realized and unrealized (gains) losses |
|
|
|
|
Transfer into Level 3 |
Transfer out of Level 3 |
Ending balance as of |
Total (gains) losses included in net (income) attributable to liabilities still held |
||||||||||||||||||||||||||||||||||
(Amounts in millions) |
Included in net (income) |
Included in OCI |
Purchases |
Sales |
Issuances |
Settlements |
||||||||||||||||||||||||||||||||||||||
Policyholder account balances: |
||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded derivatives (1) |
$ | i 250 |
$ | i 59 |
$ | i — |
$ | i — |
$ | i — |
$ | i 28 |
$ | i — |
$ | i — |
$ | i — |
$ | i 337 |
$ | i 61 |
||||||||||||||||||||||
Fixed index annuity embedded derivatives |
i 419 |
( i 15 |
) | i — |
i — |
i — |
i — |
i — |
i — |
( i 15 |
) | i 389 |
( i 15 |
) | ||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives |
i 14 |
( i 13 |
) | i — |
i — |
i — |
i 11 |
i — |
i — |
i — |
i 12 |
( i 13 |
) | |||||||||||||||||||||||||||||||
̥ | ||||||||||||||||||||||||||||||||||||||||||||
Total policyholder account balances |
i 683 |
i 31 |
i — |
i — |
i — |
i 39 |
i — |
i — |
( i 15 |
) | i 738 |
i 33 |
||||||||||||||||||||||||||||||||
̥ | ||||||||||||||||||||||||||||||||||||||||||||
Total Level 3 liabilities |
$ | i 683 |
$ | i 31 |
$ | i — |
$ | i — |
$ | i — |
$ | i 39 |
$ | i — |
$ | i — |
$ | ( i 15 |
) | $ | i 738 |
$ | i 33 |
|||||||||||||||||||||
(1) |
Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
Beginning balance as of |
Total realized and |
Transfer into Level 3 |
Transfer out of Level 3 |
Ending balance as of |
Total (gains) losses included in (income) attributable to liabilities still held |
|||||||||||||||||||||||||||||||||||||||
(Amounts in millions) |
Included in net (income) |
Included in OCI |
Purchases |
Sales |
Issuances |
Settlements |
||||||||||||||||||||||||||||||||||||||
Policyholder account balances: |
||||||||||||||||||||||||||||||||||||||||||||
GMWB embedded (1) |
$ | i 303 |
$ | ( i 82 |
) | $ | i — |
$ | i — |
$ | i — |
$ | i 29 |
$ | i — |
$ | i — |
$ | i — |
$ | i 250 |
$ | ( i 80 |
) | ||||||||||||||||||||
Fixed index annuity embedded derivatives |
i 344 |
i 84 |
i — |
i — |
i — |
i — |
( i 9 |
) | i — |
i — |
i 419 |
i 84 |
||||||||||||||||||||||||||||||||
Indexed universal life embedded derivatives |
i 11 |
( i 8 |
) | i — |
i — |
i — |
i 11 |
i — |
i — |
i — |
i 14 |
( i 8 |
) | |||||||||||||||||||||||||||||||
Total policyholder account balances |
i 658 |
( i 6 |
) | i — |
i — |
i — |
i 40 |
( i 9 |
) | i — |
i — |
i 683 |
( i 4 |
) | ||||||||||||||||||||||||||||||
Borrowings related to securitization entities (2) |
i 12 |
i — |
i — |
i — |
i — |
i — |
( i 12 |
) | i — |
i — |
i — |
i — |
||||||||||||||||||||||||||||||||
Total Level 3 liabilities |
$ | i 670 |
$ | ( i 6 |
) | $ | i — |
$ | i — |
$ | i — |
$ | i 40 |
$ | ( i 21 |
) | $ | i — |
$ | i — |
$ | i 683 |
$ | ( i 4 |
) | |||||||||||||||||||
(1) |
Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
(2) |
See note 17 for additional information related to consolidated securitization entities . |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Total realized and unrealized (gains) losses included in net (income): |
||||||||||||
Net investment income |
$ | i — |
$ | i — |
$ | i — |
||||||
Net investment (gains) losses |
i 47 |
i 31 |
( i 6 |
) | ||||||||
Total |
$ | i 47 |
$ | i 31 |
$ | ( i 6 |
) | |||||
Total (gains) losses included in net (income) attributable to liabilities still held: |
||||||||||||
Net investment income |
$ | i — |
$ | i — |
$ | i — |
||||||
Net investment (gains) losses |
i 52 |
i 33 |
( i 4 |
) | ||||||||
Total |
$ | i 52 |
$ | i 33 |
$ | ( i 4 |
) | |||||
(Amounts in millions) |
Valuation technique |
Fair value |
Unobservable input |
Range |
Weighted-average |
|||||||||||
Policyholder account balances: |
||||||||||||||||
Withdrawal utilization rate |
i 51% - i 88%
|
i 72% |
||||||||||||||
Lapse rate |
i 2% - i 9%
|
i 4% |
||||||||||||||
Non-performance risk (credit spreads) |
i 17bps - i 83bps
|
i 64bps |
||||||||||||||
GMWB embedded derivatives (1) |
i Stochastic cash flow model |
$ |
i 323 |
Equity index volatility |
i 12% - i 24%
|
i 20% |
||||||||||
Fixed index annuity embedded derivatives |
i Option budget method |
$ |
i 452 |
Expected future interest credited |
i — %- i 3%
|
i 1% |
||||||||||
Indexed universal life embedded derivatives |
i Option budget method |
$ |
i 19 |
Expected future interest credited |
i 3% - i 9%
|
i 5% |
(1) |
Represents embedded derivatives associated with our GMWB liabilities, excluding the impact of reinsurance. |
(Amounts in millions) |
2019 |
2018 |
||||||
Assets |
||||||||
Investments: |
||||||||
Restricted commercial mortgage loans |
$ | i 47 |
$ | i 62 |
||||
Total investments |
i 47 |
i 62 |
||||||
Cash, cash equivalents and restricted cash |
i 1 |
i 1 |
||||||
Investment receivable |
i 3 |
i — |
||||||
Total assets |
$ | i 51 |
$ | i 63 |
||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Revenues: |
||||||||||||
Net investment income: |
||||||||||||
Restricted commercial mortgage loans |
$ | i 4 |
$ | i 7 |
$ | i 9 |
||||||
Restricted other invested assets |
i — |
i — |
i 1 |
|||||||||
Total net investment income |
i 4 |
i 7 |
i 10 |
|||||||||
Net investment gains (losses): |
||||||||||||
Derivatives |
i — |
i — |
i 7 |
|||||||||
Total net investment gains (losses) |
i — |
i — |
i 7 |
|||||||||
Total revenues |
i 4 |
i 7 |
i 17 |
|||||||||
Expenses: |
||||||||||||
Interest expense |
i — |
i 2 |
i 6 |
|||||||||
Total expenses |
i — |
i 2 |
i 6 |
|||||||||
Income before income taxes |
i 4 |
i 5 |
i 11 |
|||||||||
Provision (benefit) for income taxes |
i 1 |
i 1 |
( i 6 |
) | ||||||||
Net income |
$ |
i 3 |
$ |
i 4 |
$ |
i 17 |
||||||
• |
In 2019, River Lake VI was granted a permitted accounting practice from the State of Delaware to carry its excess of loss reinsurance agreement with The Canada Life Assurance Company for its universal life insurance business assumed from GLAIC in 2019 as an admitted asset. In 2018, River Lake VI was granted a permitted accounting practice from the State of Delaware to carry its term life insurance reserves on a basis similar to U.S. GAAP and was subsequently granted an extension of this permitted accounting practice to include additional term life insurance policies assumed from GLAIC in 2019. Prior to 2018, River Lake VI was granted a permitted accounting practice to carry its excess of loss reinsurance agreement with The Canada Life Assurance Company for its term life insurance business as an admitted asset, which was withdrawn in 2018. |
• |
In 2019 and 2018, River Lake VII, River Lake VIII, River Lake IX and River Lake X each had a permitted accounting practice from the State of Vermont to carry their reserves on a basis similar to U.S. GAAP. In addition, prior to 2018, River Lake IX and River Lake X were also granted a permitted accounting practice to carry their excess of loss reinsurance agreements with The Canada Life Assurance Company and Hannover Life Reassurance Company of America, respectively, as an admitted asset, which was withdrawn in 2018. As of December 31, 2019, there were no remaining reserves in River Lake IX as discussed below. |
Years ended |
||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Combined statutory net income (loss): |
||||||||||||
$ | i 740 |
$ | ( i 895 |
) | $ | ( i 272 |
) | |||||
Mortgage insurance subsidiaries |
i 847 |
i 697 |
i 512 |
|||||||||
Combined statutory net income (loss), excluding captive reinsurance subsidiaries |
i 1,587 |
( i 198 |
) | i 240 |
||||||||
Captive life insurance subsidiaries |
( i 350 |
) |
i 1,520 |
( i 36 |
) | |||||||
Combined statutory net income |
$ | i 1,237 |
$ | i 1,322 |
$ | i 204 |
||||||
As of |
||||||||
(Amounts in millions) |
2019 |
2018 |
||||||
Combined statutory capital and surplus: |
||||||||
Life insurance subsidiaries, excluding captive life reinsurance subsidiaries |
$ | i 2,188 |
$ | i 1,880 |
||||
Mortgage insurance subsidiaries |
i 3,664 |
i 3,206 |
||||||
Combined statutory capital and surplus |
$ | i 5,852 |
$ | i 5,086 |
||||
2019 |
U.S. Mortgage Insurance |
Australia Mortgage Insurance |
U.S. Life Insurance |
Runoff |
Corporate and Other |
Total |
||||||||||||||||||
(Amounts in millions) |
||||||||||||||||||||||||
Premiums |
$ | i 856 |
$ | i 312 |
$ | i 2,861 |
$ | i — |
$ | i 8 |
$ | i 4,037 |
||||||||||||
Net investment income |
i 117 |
i 55 |
i 2,852 |
i 187 |
i 9 |
i 3,220 |
||||||||||||||||||
Net investment gains (losses) |
i 1 |
i 23 |
i 82 |
( i 25 |
) | ( i 31 |
) | i 50 |
||||||||||||||||
Policy fees and other income |
i 4 |
i — |
i 643 |
i 140 |
i 2 |
i 789 |
||||||||||||||||||
Total revenues |
i 978 |
i 390 |
i 6,438 |
i 302 |
( i 12 |
) | i 8,096 |
|||||||||||||||||
Benefits and other changes in policy reserves |
i 50 |
i 104 |
i 4,979 |
i 27 |
i 3 |
i 5,163 |
||||||||||||||||||
Interest credited |
i — |
i — |
i 419 |
i 158 |
i — |
i 577 |
||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
i 191 |
i 69 |
i 604 |
i 52 |
i 46 |
i 962 |
||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
i 15 |
i 33 |
i 372 |
i 18 |
i 3 |
i 441 |
||||||||||||||||||
Interest expense |
i — |
i 8 |
i 17 |
i — |
i 214 |
i 239 |
||||||||||||||||||
Total benefits and expenses |
i 256 |
i 214 |
i 6,391 |
i 255 |
i 266 |
i 7,382 |
||||||||||||||||||
Income (loss) from continuing operations before income taxes |
i 722 |
i 176 |
i 47 |
i 47 |
( i 278 |
) | i 714 |
|||||||||||||||||
Provision (benefit) for income taxes |
i 153 |
i 53 |
i 34 |
i 8 |
( i 53 |
) | i 195 |
|||||||||||||||||
Income (loss) from continuing operations |
i 569 |
i 123 |
i 13 |
i 39 |
( i 225 |
) | i 519 |
|||||||||||||||||
Income from discontinued operations, net of taxes |
i — |
i — |
i — |
i — |
i 11 |
i 11 |
||||||||||||||||||
Net income (loss) |
i 569 |
i 123 |
i 13 |
i 39 |
( i 214 |
) | i 530 |
|||||||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
i — |
i 64 |
i — |
i — |
i — |
i 64 |
||||||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i — |
i — |
i — |
i — |
i 123 |
i 123 |
||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 569 |
$ | i 59 |
$ | i 13 |
$ | i 39 |
$ | ( i 337 |
) | $ | i 343 |
|||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ | i 569 |
$ | i 59 |
$ | i 13 |
$ | i 39 |
$ | ( i 225 |
) | $ | i 455 |
|||||||||||
L oss from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
i — |
i — |
i — |
i — |
( i 112 |
) | ( i 112 |
) | ||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 569 |
$ | i 59 |
$ | i 13 |
$ | i 39 |
$ | ( i 337 |
) | $ | i 343 |
|||||||||||
Segment assets |
$ |
i 4,504 |
$ |
i 2,406 |
$ |
i 81,640 |
$ |
i 9,953 |
$ |
i 2,839 |
$ |
i 101,342 |
||||||||||||
Assets held for sale related to discontinued operations |
i — |
i — |
i — |
i — |
i — |
i — |
||||||||||||||||||
Total assets |
$ | i 4,504 |
$ | i 2,406 |
$ | i 81,640 |
$ | i 9,953 |
$ | i 2,839 |
$ | i 101,342 |
||||||||||||
2018 |
U.S. Mortgage Insurance |
Australia Mortgage Insurance |
U.S. Life Insurance |
Runoff |
Corporate and Other |
Total |
||||||||||||||||||
(Amounts in millions) |
||||||||||||||||||||||||
Premiums |
$ | i 746 |
$ | i 373 |
$ | i 2,867 |
$ | i — |
$ |
i 8 |
$ |
i 3,994 |
||||||||||||
Net investment income |
i 93 |
i 67 |
i 2,781 |
i 174 |
i 6 |
i 3,121 |
||||||||||||||||||
Net investment gains (losses) |
i — |
( i 15 |
) | i 29 |
( i 33 |
) | i 10 |
( i 9 |
) | |||||||||||||||
Policy fees and other income |
i 2 |
i 2 |
i 641 |
i 153 |
( i 3 |
) | i 795 |
|||||||||||||||||
Total revenues |
i 841 |
i 427 |
i 6,318 |
i 294 |
i 21 |
i 7,901 |
||||||||||||||||||
Benefits and other changes in policy reserves |
i 36 |
i 110 |
i 5,416 |
i 39 |
i 5 |
i 5,606 |
||||||||||||||||||
Interest credited |
i — |
i — |
i 461 |
i 150 |
i — |
i 611 |
||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
i 169 |
i 65 |
i 584 |
i 57 |
i 68 |
i 943 |
||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
i 14 |
i 43 |
i 257 |
i 33 |
i 1 |
i 348 |
||||||||||||||||||
Interest expense |
i — |
i 9 |
i 16 |
i — |
i 231 |
i 256 |
||||||||||||||||||
Total benefits and expenses |
i 219 |
i 227 |
i 6,734 |
i 279 |
i 305 |
i 7,764 |
||||||||||||||||||
Income (loss) from continuing operations before income taxes |
i 622 |
i 200 |
( i 416 |
) | i 15 |
( i 284 |
) | i 137 |
||||||||||||||||
Provision (benefit) for income taxes |
i 132 |
i 60 |
( i 68 |
) | i 2 |
( i 56 |
) | i 70 |
||||||||||||||||
Income (loss) from continuing operations |
i 490 |
i 140 |
( i 348 |
) | i 13 |
( i 228 |
) | i 67 |
||||||||||||||||
Income from discontinued operations, net of taxes |
i — |
i — |
i — |
i — |
i 230 |
i 230 |
||||||||||||||||||
Net income (loss) |
i 490 |
i 140 |
( i 348 |
) | i 13 |
i 2 |
i 297 |
|||||||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
i — |
i 70 |
i — |
i — |
i — |
i 70 |
||||||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i — |
i — |
i — |
i — |
i 108 |
i 108 |
||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 490 |
$ | i 70 |
$ | ( i 348 |
) | $ | i 13 |
$ | ( i 106 |
) | $ | i 119 |
||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ | i 490 |
$ | i 70 |
$ | ( i 348 |
) | $ | i 13 |
$ | ( i 228 |
) | $ | ( i 3 |
) | |||||||||
Income from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
i — |
i — |
i — |
i — |
i 122 |
i 122 |
||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 490 |
$ | i 70 |
$ | ( i 348 |
) | $ | i 13 |
$ | ( i 106 |
) | $ | i 119 |
||||||||||
Segment assets |
$ |
i 3,583 |
$ |
i 2,534 |
$ |
i 79,799 |
$ |
i 9,963 |
$ |
i 29 |
$ |
i 95,908 |
||||||||||||
Assets held for sale related to discontinued operations |
i — |
i — |
i — |
i — |
i 5,015 |
i 5,015 |
||||||||||||||||||
Total assets |
$ | i 3,583 |
$ | i 2,534 |
$ | i 79,799 |
$ | i 9,963 |
$ | i 5,044 |
$ | i 100,923 |
||||||||||||
2017 |
U.S. Mortgage Insurance |
Australia Mortgage Insurance |
U.S. Life Insurance |
Runoff |
Corporate and Other |
Total |
||||||||||||||||||
(Amounts in millions) |
||||||||||||||||||||||||
Premiums |
$ | i 695 |
$ | ( i 140 |
) | $ | i 2,922 |
$ | i — |
$ | i 8 |
$ | i 3,485 |
|||||||||||
Net investment income |
i 73 |
i 75 |
i 2,755 |
i 160 |
i 3 |
i 3,066 |
||||||||||||||||||
Net investment gains (losses) |
i — |
i 25 |
i 134 |
i 16 |
( i 38 |
) | i 137 |
|||||||||||||||||
Policy fees and other income |
i 4 |
i — |
i 660 |
i 163 |
( i 2 |
) | i 825 |
|||||||||||||||||
Total revenues |
i 772 |
( i 40 |
) | i 6,471 |
i 339 |
( i 29 |
) | i 7,513 |
||||||||||||||||
Benefits and other changes in policy reserves |
i 107 |
i 109 |
i 4,880 |
i 26 |
i 3 |
i 5,125 |
||||||||||||||||||
Interest credited |
i — |
i — |
i 506 |
i 140 |
i — |
i 646 |
||||||||||||||||||
Acquisition and operating expenses, net of deferrals |
i 165 |
i 67 |
i 572 |
i 61 |
i 92 |
i 957 |
||||||||||||||||||
Amortization of deferred acquisition costs and intangibles |
i 14 |
i 24 |
i 328 |
i 24 |
i 2 |
i 392 |
||||||||||||||||||
Interest expense |
i — |
i 9 |
i 13 |
i 2 |
i 242 |
i 266 |
||||||||||||||||||
Total benefits and expenses |
i 286 |
i 209 |
i 6,299 |
i 253 |
i 339 |
i 7,386 |
||||||||||||||||||
Income (loss) from continuing operations before income taxes |
i 486 |
( i 249 |
) | i 172 |
i 86 |
( i 368 |
) | i 127 |
||||||||||||||||
Provision (benefit) for income taxes |
i 175 |
( i 90 |
) | i 60 |
i 25 |
( i 576 |
) | ( i 406 |
) | |||||||||||||||
Income (loss) from continuing operations |
i 311 |
( i 159 |
) | i 112 |
i 61 |
i 208 |
i 533 |
|||||||||||||||||
Income from discontinued operations, net of taxes |
i — |
i — |
i — |
i — |
i 394 |
i 394 |
||||||||||||||||||
Net income (loss) |
i 311 |
( i 159 |
) | i 112 |
i 61 |
i 602 |
i 927 |
|||||||||||||||||
Less: net loss from continuing operations attributable to noncontrolling interests |
i — |
( i 80 |
) | i — |
i — |
i — |
( i 80 |
) | ||||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i — |
i — |
i — |
i — |
i 190 |
i 190 |
||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 311 |
$ | ( i 79 |
) | $ | i 112 |
$ | i 61 |
$ | i 412 |
$ | i 817 |
|||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||||||||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ | i 311 |
$ | ( i 79 |
) | $ | i 112 |
$ | i 61 |
$ | i 208 |
$ | i 613 |
|||||||||||
Income from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
i — |
i — |
i — |
i — |
i 204 |
i 204 |
||||||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 311 |
$ | ( i 79 |
) | $ | i 112 |
$ | i 61 |
$ | i 412 |
$ | i 817 |
|||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Revenues: |
||||||||||||
U.S. Mortgage Insurance segment |
$ | i 978 |
$ | i 841 |
$ | i 772 |
||||||
Australia Mortgage Insurance segment |
i 390 |
i 427 |
( i 40 |
) | ||||||||
U.S. Life Insurance segment: |
||||||||||||
Long-term care insurance |
i 4,385 |
i 4,197 |
i 4,062 |
|||||||||
Life insurance |
i 1,444 |
i 1,430 |
i 1,591 |
|||||||||
Fixed annuities |
i 609 |
i 691 |
i 818 |
|||||||||
U.S. Life Insurance segment |
i 6,438 |
i 6,318 |
i 6,471 |
|||||||||
Runoff segment |
i 302 |
i 294 |
i 339 |
|||||||||
Corporate and Other activities |
( i 12 |
) | i 21 |
( i 29 |
) | |||||||
Total revenues |
$ | i 8,096 |
$ | i 7,901 |
$ | i 7,513 |
||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
|
$ | i 343 |
$ | i 119 |
$ | i 817 |
|||||
Add: net income (loss) from continuing operations attributable to noncontrolling interests |
i 64 |
i 70 |
( i 80 |
) | ||||||||
Add: net income from discontinued operations attributable to noncontrolling interests |
i 123 |
i 108 |
i 190 |
|||||||||
Net income |
i 530 |
i 297 |
i 927 |
|||||||||
Income from discontinued operations, net of taxes |
i 11 |
i 230 |
i 394 |
|||||||||
Income from continuing operations |
i 519 |
i 67 |
i 533 |
|||||||||
Less: net income (loss) from continuing operations attributable to noncontrolling interests |
i 64 |
i 70 |
( i 80 |
) | ||||||||
Income (loss) from continuing operations available to Genworth Financial, Inc.’s |
i 455 |
( i 3 |
) | i 613 |
||||||||
Adjustments to income (loss) from continuing operations available to Genworth |
||||||||||||
Net investment (gains) losses, net (1) |
( i 50 |
) | ( i 10 |
) | ( i 128 |
) | ||||||
Expenses related to restructuring |
i 4 |
i 2 |
i 1 |
|||||||||
Fees associated with bond consent solicitation |
— |
i 6 |
— |
|||||||||
Taxes on adjustments |
i 11 |
— |
i 44 |
|||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s |
$ | i 420 |
$ | ( i 5 |
) | $ | i 530 |
|||||
(1) |
For the years ended December 31, 2019, 2018 and 2017, net investment (gains) losses were adjusted for DAC and other intangible amortization and certain benefit reserves of $( i 11) million, $( i 12 )
million and $( i 3 ) million, respectively, and adjusted for net investment gains (losses) attributable to noncontrolling interests of $ i 11
million, $( i 7 ) million and $ i 12 million,
respectively. |
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders: |
||||||||||||
U.S. Mortgage Insurance segment |
$ | i 568 |
$ |
i 490 |
$ | i 311 |
||||||
Australia Mortgage Insurance segment |
i 51 |
i 76 |
( i 88 |
) | ||||||||
U.S. Life Insurance segment: |
||||||||||||
Long-term care insurance |
i 57 |
( i 348 |
) | i 59 |
||||||||
Life insurance |
( i 181 |
) | ( i 107 |
) | ( i 79 |
) | ||||||
Fixed annuities |
i 69 |
i 79 |
i 42 |
|||||||||
U.S. Life Insurance segment |
( i 55 |
) | ( i 376 |
) | i 22 |
|||||||
Runoff segment |
i 56 |
i 35 |
i 51 |
|||||||||
Corporate and Other activities |
( i 200 |
) | ( i 230 |
) | i 234 |
|||||||
Adjusted operating income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 420 |
$ | ( i 5 |
) | $ | i 530 |
|||||
2019 |
||||||||||||||||||||
(Amounts in millions) |
United States |
Australia |
Other Countries |
Total International |
Total |
|||||||||||||||
Total revenues |
$ | i 7,697 |
$ | i 390 |
$ | i 9 |
$ | i 399 |
$ | i 8,096 |
||||||||||
Income (loss) from continuing operations |
$ | i 398 |
$ | i 123 |
$ | ( i 2 |
) | $ | i 121 |
$ | i 519 |
|||||||||
Net income |
$ | i 398 |
$ | i 123 |
$ | i 9 |
$ | i 132 |
$ | i 530 |
||||||||||
Segment assets |
$ | i 98,881 |
$ | i 2,406 |
$ | i 55 |
$ | i 2,461 |
$ | i 101,342 |
||||||||||
Assets held for sale related to discontinued operations |
$ | i — |
$ | i — |
$ | i — |
$ | i — |
$ | — |
||||||||||
Total assets |
$ | i 98,881 |
$ | i 2,406 |
$ | i 55 |
$ | i 2,461 |
$ | i 101,342 |
||||||||||
2018 |
||||||||||||||||||||
(Amounts in millions) |
United S tates |
Australia |
Other Countries |
Total International |
Total |
|||||||||||||||
Total revenues |
$ | i 7,465 |
$ | i 427 |
$ | i 9 |
$ | i 436 |
$ | i 7,901 |
||||||||||
Income (loss) from continuing operations |
$ | ( i 69 |
) | $ | i 140 |
$ | ( i 4 |
) | $ | i 136 |
$ | i 67 |
||||||||
Net income (loss) |
$ | ( i 69 |
) | $ | i 140 |
$ | i 226 |
$ | i 366 |
$ | i 297 |
|||||||||
Segment assets |
$ | i 93,319 |
$ | i 2,534 |
$ | i 55 |
$ | i 2,589 |
$ | i 95,908 |
||||||||||
Assets held for sale related to discontinued operations |
$ | i — |
$ | i — |
$ | i 5,015 |
$ | i 5,015 |
$ | i 5,015 |
||||||||||
Total assets |
$ | i 93,319 |
$ | i 2,534 |
$ | i 5,070 |
$ | i 7,604 |
$ | i 100,923 |
||||||||||
2017 |
||||||||||||||||||||
(Amounts in millions) |
United States |
Australia |
Other Countries |
Total International |
Total |
|||||||||||||||
Total revenues |
$ |
i 7,544 |
$ | ( i 40 |
) | $ | i 9 |
$ | ( i 31 |
) | $ |
i 7,513 |
||||||||
Income (loss) from continuing operations |
$ | i 695 |
$ | ( i 159 |
) | $ | ( i 3 |
) | $ | ( i 162 |
) | $ | i 533 |
|||||||
Net income (loss) |
$ | i 695 |
$ | ( i 159 |
) | $ | i 391 |
$ | i 232 |
$ | i 927 |
|||||||||
Three months ended |
||||||||||||||||
(Amounts in millions, except per share amounts) |
||||||||||||||||
Total revenues |
$ | i 2,044 |
$ | i 1,994 |
$ | i 2,020 |
$ | i 2,038 |
||||||||
Total benefits and expenses (1) |
$ | i 1,807 |
$ | i 1,770 |
$ | i 1,848 |
$ | i 1,957 |
||||||||
Income from continuing operations (2) |
$ | i 168 |
$ | i 158 |
$ | i 138 |
$ | i 55 |
||||||||
Income (loss) from discontinued operations, net of taxes (3) |
$ | i 62 |
$ | i 60 |
$ | ( i 80 |
) | $ | ( i 31 |
) | ||||||
Net income (2), (3) |
$ | i 230 |
$ | i 218 |
$ | i 58 |
$ | i 24 |
||||||||
Net income from continuing operations attributable |
$ | i 20 |
$ | i 15 |
$ | i 10 |
$ | i 19 |
||||||||
Net income from discontinued operations attributable |
$ | i 36 |
$ | i 35 |
$ | i 30 |
$ | i 22 |
||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 174 |
$ | i 168 |
$ | i 18 |
$ | ( i 17 |
) | |||||||
Net income (loss) available to Genworth Financial, Inc.’s |
||||||||||||||||
Income from continuing operations available to Genworth Financial, Inc.’s common stockholders |
$ | i 148 |
$ | i 143 |
$ | i 128 |
$ | i 36 |
||||||||
Income (loss) from discontinued operations available to Genworth Financial, Inc.’s common stockholders |
i 26 |
i 25 |
( i 110 |
) | ( i 53 |
) | ||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 174 |
$ | i 168 |
$ | i 18 |
$ | ( i 17 |
) | |||||||
Income from continuing operations available to Genworth Financial, Inc .’s common stockholders per share: |
||||||||||||||||
Basic |
$ | i 0.29 |
$ | i 0.29 |
$ | i 0.25 |
$ | i 0.07 |
||||||||
Diluted |
$ | i 0.29 |
$ | i 0.28 |
$ | i 0.25 |
$ | i 0.07 |
||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders per share: |
||||||||||||||||
Basic |
$ | i 0.35 |
$ | i 0.33 |
$ | i 0.04 |
$ | ( i 0.03 |
) | |||||||
Diluted |
$ | i 0.34 |
$ | i 0.33 |
$ | i 0.04 |
$ | ( i 0.03 |
) | |||||||
Weighted-average common shares outstanding: |
||||||||||||||||
Basic |
i 501.2 |
i 503.4 |
i 503.5 |
i 503.5 |
||||||||||||
Diluted |
i 508.6 |
i 508.7 |
i 511.2 |
i 510.4 |
(1) |
Our life insurance business completed its annual review of assumptions in the fourth quarter of 2019, which resulted in higher total benefits and expenses of $ i 145 million from an unf unlocking in our universal and term universal life insurance
products driven mostly by the lowa vorable er interest rate environment. |
(2) |
In the fourth quarter of 2019, our life insurance business recorded $ i 139 million of unfavorable charges, net of taxes, primarily related to its annual review of assumptions in our universal and term universal life insurance products, as described above. This unfavorable unlocking in our life insurance business was partially offset by favorable adjustments in our U.S.
mortgage insurance business, including a favorable update of $ i 11 million, net of taxes, in connection with a review of its single premium earnings pattern and a favorable reserve adjustment of $ i 10 million,
net of taxes. |
(3) |
In the fourth quarter of 2019, we recorded an after-tax loss of approximately $ i 110 million principally in connection with pending litigation involving our former lifestyle protection insurance business. See note 21 for additional information related to asserted claims regarding the sale of our lifestyle protection insurance business. We completed the sale of Genworth Canada on December 12,
2019 and recorded an incremental gain of $ i 43 million in the fourth quarter of 2019 predominantly related to a favorable tax position refinement. In addition, during the fourth quarter of 2019 through the sale closing date of December 12, 2019, we recorded $ i 36 million
of income from discontinued operations attributed to Genworth Canada. |
Three months ended |
||||||||||||||||
(Amounts in millions, except per share amounts) |
||||||||||||||||
Total revenues |
$ | i 1,957 |
$ | i 2,007 |
$ | i 1,952 |
$ | i 1,985 |
||||||||
Total benefits and expenses (1) |
$ | i 1,839 |
$ | i 1,741 |
$ | i 1,817 |
$ | i 2,367 |
||||||||
Income (loss) from continuing operations (2) |
$ | i 82 |
$ | i 153 |
$ | i 105 |
$ | ( i 273 |
) | |||||||
Income (loss) from discontinued operations, net of taxes (3) |
$ | i 83 |
$ | i 96 |
$ | i 105 |
$ | ( i 54 |
) | |||||||
Net income (loss) (2) |
$ | i 165 |
$ | i 249 |
$ | i 210 |
$ | ( i 327 |
) | |||||||
Net income from continuing operations attributable to |
$ | i 17 |
$ | i 27 |
$ | i 18 |
$ | i 8 |
||||||||
Net income (loss) from discontinued operations attributable to (4) |
$ | i 36 |
$ | i 32 |
$ | i 46 |
$ | ( i 6 |
) | |||||||
Net income (loss) available to Genworth Financial, Inc.’s (2) |
$ | i 112 |
$ | i 190 |
$ | i 146 |
$ | ( i 329 |
) | |||||||
Net income (loss) available to Genworth Financial, Inc.’s |
||||||||||||||||
Income (loss) from continuing operations available to |
$ | i 65 |
$ | i 126 |
$ | i 87 |
$ | ( i 281 |
) | |||||||
Income (loss) from discontinued operations available to |
i 47 |
i 64 |
i 59 |
( i 48 |
) | |||||||||||
Net income (loss) available to Genworth Financial, Inc.’s |
$ | i 112 |
$ | i 190 |
$ | i 146 |
$ | ( i 329 |
) | |||||||
Income (loss) from continuing operations available to Genworth |
||||||||||||||||
Basic |
$ | i 0.13 |
$ | i 0.25 |
$ | i 0.17 |
$ | ( i 0.56 |
) | |||||||
Diluted |
$ | i 0.13 |
$ | i 0.25 |
$ | i 0.17 |
$ | ( i 0.56 |
) | |||||||
Net income (loss) available to Genworth Financial, Inc.’s |
||||||||||||||||
Basic |
$ | i 0.22 |
$ | i 0.38 |
$ | i 0.29 |
$ | ( i 0.66 |
) | |||||||
Diluted |
$ | i 0.22 |
$ | i 0.38 |
$ | i 0.29 |
$ | ( i 0.66 |
) | |||||||
Weighted-average common shares outstanding: |
||||||||||||||||
Basic |
i 499.6 |
i 500.6 |
i 500.7 |
i 500.8 |
||||||||||||
Diluted (5) |
i 502.7 |
i 502.6 |
i 503.3 |
i 500.8 |
(1) |
Our long-term care insurance business completed its annual review of claim reserves in the fourth quarter of 2018, which resulted in higher total benefits and expenses of $ i 291 million driven mostly by updates to several assumptions and methodologies, including benefit utilization rates, claim termination rates and other assumptions . Also in our long-term care insurance business, we refined our estimate
of unreported policy |
t |
(2) |
In the fourth quarter of 2018, our long-term care insurance business recorded a $ i 230 million unfavorable adjustment, net of taxes, related to its annual review of claim reserves, as described above. In addition, our long-term care insurance business recorded a $ i 28 million unfavorable reserve adjustment, net of taxes, related to a refined estimate of unreported policy terminations. Our life insurance business recorded an unfavorable adjustment, net of taxes, of $ i 91 million resulting from its annual review of assumptions, as described above. |
(3) |
Includes net investment losses of $ i 107 million recorded in the fourth quarter of 2018 in our Canada mortgage insurance business reported as discontinued operations. These losses were primarily related to derivative losses on foreign currency swaps and forwards, and losses on preferred equity securities primarily driven by a decrease in interest rates in Canada during the fourth quarter of 2018. |
(4) |
Our Canada mortgage insurance business, reported as discontinued operations, recorded net investment losses, net of taxes, of $ i 107 million, of which the amount attributable to noncontrolling interests was $ i 45 million, net of taxes. |
(5) |
Under applicable accounting guidance, companies in a loss position are required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share. Therefore, as a result of our loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the three months ended December 31, 2018, we were required to use basic weighted-average common shares outstanding in the calculation of diluted loss per share for the three months ended December 31, 2018, as the inclusion of shares for stock options, RSUs and SARs of i 7.6 million would have been antidilutive to the calculation. If we had not incurred a loss from continuing operations available to Genworth Financial, Inc.’s common stockholders for the three months ended December 31, 2018, dilutive potential weighted-average common shares outstanding would have been i 508.4 million. |
(Amounts in millions) |
Net unrealized investment gains (losses) (1) |
Derivatives qualifying as hedges (2) |
Foreign currency translation and other adjustments |
Total |
||||||||||||
Balances as of January 1, 2019 |
$ | i 595 |
$ | i 1,781 |
$ | ( i 332 |
) | $ | i 2,044 |
|||||||
OCI before reclassifications |
i 910 |
i 331 |
i 487 |
i 1,728 |
||||||||||||
Amounts reclassified from (to) OCI |
( i 62 |
) | ( i 110 |
) | i — |
( i 172 |
) | |||||||||
Current period OCI |
i 848 |
i 221 |
i 487 |
i 1,556 |
||||||||||||
Balances as of December 31, 2019 before noncontrolling interests |
i 1,443 |
i 2,002 |
i 155 |
i 3,600 |
||||||||||||
Less: change in OCI attributable to noncontrolling interests |
( i 13 |
) | i — |
i 180 |
i 167 |
|||||||||||
Balances as of December 31, 2019 |
$ | i 1,456 |
$ | i 2,002 |
$ | ( i 25 |
) | $ | i 3,433 |
|||||||
(1) |
Net of adjustments to DAC, PVFP, sales inducements and benefit reserves. See note 4 for additional information. |
(2) |
See note 5 for additional information. |
(Amounts in millions) |
Net unrealized investment gains (losses) (1) |
Derivatives qualifying as hedges (2) |
Foreign currency translation and other adjustments |
Total |
||||||||||||
Balances as of January 1, 2018 |
$ | i 1,085 |
$ | i 2,065 |
$ | ( i 123 |
) | $ | i 3,027 |
|||||||
Cumulative effect of changes in accounting |
i 164 |
i 14 |
( i 47 |
) | i 131 |
|||||||||||
OCI before reclassifications |
( i 653 |
) |
( i 194 |
) |
( i 301 |
) | ( i 1,148 |
) | ||||||||
Amounts reclassified from (to) OCI |
( i 18 |
) |
( i 104 |
) |
i — |
( i 122 |
) | |||||||||
Current period OCI |
( i 671 |
) |
( i 298 |
) |
( i 301 |
) | ( i 1,270 |
) | ||||||||
Balances as of December 31, 2018 before noncontrolling interests |
i 578 |
i 1,781 |
( i 471 |
) | i 1,888 |
|||||||||||
Less: change in OCI attributable to noncontrolling interests |
( i 17 |
) |
i — |
( i 139 |
) | ( i 156 |
) | |||||||||
Balances as of December 31, 2018 |
$ | i 595 |
$ | i 1,781 |
$ | ( i 332 |
) | $ | i 2,044 |
|||||||
(1) |
Net of adjustments to DAC, PVFP, sales inducements and benefit reserves. See note 4 for additional information. |
(2) |
See note 5 for additional information. |
(Amounts in millions) |
Net unrealized investment gains (losses) (1) |
Derivatives qualifying as hedges (2) |
Foreign currency translation and other adjustments |
Total |
||||||||||||
Balances as of January 1, 2017 |
$ | i 1,262 |
$ | i 2,085 |
$ | ( i 253 |
) | $ | i 3,094 |
|||||||
OCI before reclassifications |
( i 84 |
) |
i 38 |
i 251 |
i 205 |
|||||||||||
Amounts reclassified from (to) OCI |
( i 102 |
) |
( i 58 |
) |
i — |
( i 160 |
) | |||||||||
Current period OCI |
( i 186 |
) |
( i 20 |
) |
i 251 |
i 45 |
||||||||||
Balances as of December 31, 2017 before noncontrolling interests |
i 1,076 |
i 2,065 |
( i 2 |
) | i 3,139 |
|||||||||||
Less: change in OCI attributable to noncontrolling interests |
( i 9 |
) |
i — |
i 121 |
i 112 |
|||||||||||
Balances as of December 31, 2017 |
$ | i 1,085 |
$ | i 2,065 |
$ | ( i 123 |
) | $ | i 3,027 |
|||||||
(1) |
Net of adjustments to DAC, PVFP, sales inducements and benefit reserves. See note 4 for additional information. |
(2) |
See note 5 for additional information. |
Amount reclassified from accumulated other comprehensive income (loss) |
Affected line item in the | |||||||||||||
Years ended December 31, |
consolidated statements | |||||||||||||
(Amounts in millions) |
2019 |
2018 |
2017 |
of income | ||||||||||
Net unrealized investment (gains) losses: |
||||||||||||||
Unrealized (gains) losses on investments (1) |
$ | ( i 79 |
) | $ | ( i 23 |
) | $ | ( i 157 |
) | Net investment (gains) losses | ||||
B enefit for income taxes |
i 17 |
i 5 |
i 55 |
Provision ( benefit) for income taxes | ||||||||||
Total |
$ | ( i 62 |
) | $ | ( i 18 |
) | $ | ( i 102 |
) | |||||
Derivatives qualifying as hedges: |
||||||||||||||
Interest rate swaps hedging assets |
$ | ( i 164 |
) | $ | ( i 153 |
) | $ | ( i 131 |
) | Net investment income | ||||
Interest rate swaps hedging assets |
( i 6 |
) | ( i 9 |
) | ( i 8 |
) | Net investment (gains) losses | |||||||
B enefit for income taxes |
i 60 |
i 58 |
i 81 |
Provision ( benefit) for income taxes | ||||||||||
Total |
$ | ( i 110 |
) | $ | ( i 104 |
) | $ | ( i 58 |
) | |||||
(1) |
Amounts exclude adjustments to DAC, PVFP, sales inducements and benefit reserves. |
(Amounts in millions) |
|
|||
Net cash proceeds |
$ | i 1,736 |
||
Add: carrying value of noncontrolling interests (1) |
i 1,417 |
|||
Total adjusted consideration (2) |
i 3,153 |
|||
Carrying value of the disposal group before accumulated other |
i 3,022 |
|||
Add: total accumulated other comprehensive loss of disposal (3) |
i 325 |
|||
Total adjusted carrying value of the disposal group |
i 3,347 |
|||
Pre-tax loss on sale |
( i 194 |
) | ||
Tax benefit on sale |
i 73 |
|||
After-tax loss on sale |
$ | ( i 121 |
) | |
(1) |
In accordance with accounting guidance on the deconsolidation of a subsidiary or group of assets, the carrying amount of any noncontrolling interests in the subsidiary sold (adjusted to reflect amounts in accumulated other comprehensive income (loss) recognized upon final disposition) is added to the total fair value of the consideration to be received. |
(2) |
Represents the aggregate of the net cash proceeds received upon sale closing plus the adjusted carrying amount of noncontrolling interests in the subsidiary sold. |
(3) |
Consists primarily of cumulative losses on foreign currency translation adjustments of $ i 369 million and deferred tax losses of $ i 71
million , partially offset by unrealized investment gains of $ i 115 million . |
(Amounts in millions) |
2019 |
2018 |
||||||
Assets |
||||||||
Investments: |
||||||||
Fixed maturity securities available-for-sale, at fair value |
$ |
i — |
$ | i 4,072 |
||||
Equity securities, at fair value |
i — |
i 380 |
||||||
Other invested assets |
i — |
i 116 |
||||||
Total investments |
i — |
i 4,568 |
||||||
Cash, cash equivalents and restricted cash |
i — |
i 203 |
||||||
Accrued investment income |
i — |
i 30 |
||||||
Deferred acquisition costs |
i — |
i 121 |
||||||
Intangible assets and goodwill |
i — |
i 14 |
||||||
Other assets |
i — |
i 79 |
||||||
Assets held for sale related to discontinued operations |
$ |
i — |
$ |
i 5,015 |
||||
Liabilities |
||||||||
Liability for policy and contract claims |
$ | i — |
$ | i 84 |
||||
Unearned premiums |
i — |
i 1,533 |
||||||
Other liabilities |
i — |
i 154 |
||||||
Long-term borrowings |
i — |
i 318 |
||||||
Deferred tax liability |
i — |
i 23 |
||||||
Liabilities held for sale related to discontinued operations |
$ | i — |
$ | i 2,112 |
||||
(Amounts in millions) |
2019 |
2018 |
2017 |
|||||||||
Revenues: |
||||||||||||
Premiums |
$ | i 466 |
$ | i 525 |
$ | i 519 |
||||||
Net investment income |
i 132 |
i 141 |
i 134 |
|||||||||
Net investment gains (losses) |
( i 13 |
) | ( i 137 |
) | i 128 |
|||||||
Policy fees and other income |
i — |
— |
i 1 |
|||||||||
Total revenues |
i 585 |
i 529 |
i 782 |
|||||||||
Benefits and expenses: |
||||||||||||
Benefits and other changes in policy reserves |
i 79 |
i 78 |
i 54 |
|||||||||
Acquisition and operating expenses, net of deferrals |
i 64 |
i 54 |
i 65 |
|||||||||
Amortization of deferred acquisition costs and intangibles |
i 39 |
i 43 |
i 43 |
|||||||||
Interest expense (1) |
i 50 |
i 43 |
i 18 |
|||||||||
Total benefits and expenses |
i 232 |
i 218 |
i 180 |
|||||||||
Income before income taxes and loss on sale (2) |
i 353 |
i 311 |
i 602 |
|||||||||
Provision for income taxes |
i 111 |
i 81 |
i 199 |
|||||||||
Income before loss on sale |
i 242 |
i 230 |
i 403 |
|||||||||
Loss on sale, net of taxes |
( i 121 |
) | — |
— |
||||||||
Income from discontinued operations, net of taxes |
i 121 |
i 230 |
i 403 |
|||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i 123 |
i 108 |
i 190 |
|||||||||
Income (loss) from discontinued operations available to |
$ | ( i 2 |
) | $ | i 122 |
$ | i 213 |
|||||
(1) |
Interest on debt assumed by Brookfield and interest on debt that was repaid as a result of the sale of Genworth Canada was allocated and reported in discontinued operations. The Term Loan, owed by Genworth Holdings and secured by GFIH’s ownership interest in Genworth Canada’s outstanding common shares, was repaid in connection with the close of the Genworth Canada sale. Accordingly, interest expense related to the Term Loan of $ i 34
million, $ i 25 million and $— million for the years ended December 31, 2019, 2018 and 2017, respectively, was allocated and reported in discontinued operations. |
(2) |
The years ended December 31, 2019, 2018 and 2017 include pre-tax income from discontinued operations available to Genworth Financial, Inc.’s common stockholders of $ i 186
million, $ i 167 million and $ i 344 million,
respectively. |
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Assets |
||||||||||||||||||||
Investments: |
||||||||||||||||||||
Fixed maturity securities available-for-sale, at fair value |
$ | i — |
$ | i — |
$ | i 60,539 |
$ | ( i 200 |
) | $ | i 60,339 |
|||||||||
Equity securities, at fair value |
i — |
i — |
i 239 |
i — |
i 239 |
|||||||||||||||
Commercial mortgage loans ($ i 47 are restricted related to a securitization entity) |
i — |
i — |
i 6,963 |
i — |
i 6,963 |
|||||||||||||||
Policy loans |
i — |
i — |
i 2,058 |
i — |
i 2,058 |
|||||||||||||||
Other invested assets |
i — |
i 71 |
i 1,561 |
i — |
i 1,632 |
|||||||||||||||
Investments in subsidiaries |
i 14,079 |
i 15,090 |
i — |
( i 29,169 |
) | i — |
||||||||||||||
Total investments |
i 14,079 |
i 15,161 |
i 71,360 |
( i 29,369 |
) | i 71,231 |
||||||||||||||
Cash, cash equivalents and restricted cash |
i — |
i 1,461 |
i 1,880 |
i — |
i 3,341 |
|||||||||||||||
Accrued investment income |
i — |
i — |
i 657 |
( i 3 |
) | i 654 |
||||||||||||||
Deferred acquisition costs |
i — |
i — |
i 1,836 |
i — |
i 1,836 |
|||||||||||||||
Intangible assets and goodwill |
i — |
i — |
i 201 |
i — |
i 201 |
|||||||||||||||
Reinsurance recoverable |
i — |
i — |
i 17,103 |
i — |
i 17,103 |
|||||||||||||||
Other assets |
i 4 |
i 48 |
i 392 |
( i 1 |
) | i 443 |
||||||||||||||
Intercompany notes receivable |
i 119 |
i 132 |
i — |
( i 251 |
) | i — |
||||||||||||||
Deferred tax assets |
i 13 |
i 821 |
( i 409 |
) | i — |
i 425 |
||||||||||||||
Separate account assets |
i — |
i — |
i 6,108 |
i — |
i 6,108 |
|||||||||||||||
Total assets |
$ | i 14,215 |
$ | i 17,623 |
$ | i 99,128 |
$ | ( i 29,624 |
) | $ | i 101,342 |
|||||||||
Liabilities and equity |
||||||||||||||||||||
Liabilities: |
||||||||||||||||||||
Future policy benefits |
$ | i — |
$ | i — |
$ | i 40,384 |
$ | i — |
$ | i 40,384 |
||||||||||
Policyholder account balances |
i — |
i — |
i 22,217 |
i — |
i 22,217 |
|||||||||||||||
Liability for policy and contract claims |
i — |
i — |
i 10,958 |
i — |
i 10,958 |
|||||||||||||||
Unearned premiums |
i — |
i — |
i 1,893 |
i — |
i 1,893 |
|||||||||||||||
Other liabilities |
i 30 |
i 99 |
i 1,438 |
( i 5 |
) | i 1,562 |
||||||||||||||
Intercompany notes payable |
i — |
i 319 |
i 132 |
( i 451 |
) | i — |
||||||||||||||
Non-recourse funding obligations |
i — |
i — |
i 311 |
i — |
i 311 |
|||||||||||||||
Long-term borrowings |
i — |
i 3,137 |
i 140 |
i — |
i 3,277 |
|||||||||||||||
Separate account liabilities |
i — |
i — |
i 6,108 |
i — |
i 6,108 |
|||||||||||||||
Total liabilities |
i 30 |
i 3,555 |
i 83,581 |
( i 456 |
) | i 86,710 |
||||||||||||||
Equity: |
||||||||||||||||||||
Common stock |
i 1 |
i — |
i 3 |
( i 3 |
) | i 1 |
||||||||||||||
Additional paid-in capital |
i 11,990 |
i 12,761 |
i 18,431 |
( i 31,192 |
) | i 11,990 |
||||||||||||||
Accumulated other comprehensive income (loss) |
i 3,433 |
i 3,433 |
i 3,474 |
( i 6,907 |
) | i 3,433 |
||||||||||||||
Retained earnings |
i 1,461 |
( i 2,126 |
) | ( i 7,108 |
) | i 9,234 |
i 1,461 |
|||||||||||||
Treasury stock, at cost |
( i 2,700 |
) | i — |
i — |
i — |
( i 2,700 |
) | |||||||||||||
Total Genworth Financial, Inc.’s stockholders’ equity |
i 14,185 |
i 14,068 |
i 14,800 |
( i 28,868 |
) | i 14,185 |
||||||||||||||
Noncontrolling interests |
i — |
i — |
i 747 |
( i 300 |
) | i 447 |
||||||||||||||
Total equity |
i 14,185 |
i 14,068 |
i 15,547 |
( i 29,168 |
) | i 14,632 |
||||||||||||||
Total liabilities and equity |
$ | i 14,215 |
$ | i 17,623 |
$ | i 99,128 |
$ | ( i 29,624 |
) | $ | i 101,342 |
|||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Assets |
||||||||||||||||||||
Investments: |
||||||||||||||||||||
Fixed maturity securities available-for-sale, at fair value |
$ |
i — |
$ |
i — |
$ |
i 55,789 |
$ |
( i 200 |
) |
$ |
i 55,589 |
|||||||||
Equity securities, at fair value |
i — |
i — |
i 275 |
i — |
i 275 |
|||||||||||||||
Commercial mortgage loans ($ i 62 are restricted related to a securitization entity) |
i — |
i — |
i 6,749 |
i — |
i 6,749 |
|||||||||||||||
Policy loans |
i — |
i — |
i 1,861 |
i — |
i 1,861 |
|||||||||||||||
Other invested assets |
i — |
i 86 |
i 988 |
( i 2 |
) |
i 1,072 |
||||||||||||||
Investments in subsidiaries |
i 12,570 |
i 11,462 |
i — |
( i 24,032 |
) |
i — |
||||||||||||||
Total investments |
i 12,570 |
i 11,548 |
i 65,662 |
( i 24,234 |
) |
i 65,546 |
||||||||||||||
Cash, cash equivalents and restricted cash |
i — |
i 429 |
i 1,545 |
i — |
i 1,974 |
|||||||||||||||
Accrued investment income |
i — |
i — |
i 649 |
( i 4 |
) |
i 645 |
||||||||||||||
Deferred acquisition costs |
i — |
i — |
i 3,142 |
i — |
i 3,142 |
|||||||||||||||
Intangible assets and goodwill |
i — |
i — |
i 333 |
i — |
i 333 |
|||||||||||||||
Reinsurance recoverable |
i — |
i — |
i 17,278 |
i — |
i 17,278 |
|||||||||||||||
Other assets |
i 15 |
i 62 |
i 318 |
i — |
i 395 |
|||||||||||||||
Intercompany notes receivable |
i — |
i 180 |
i 6 |
( i 186 |
) |
i — |
||||||||||||||
Deferred tax assets |
i 14 |
i 907 |
( i 185 |
) |
i — |
i 736 |
||||||||||||||
Separate account assets |
i — |
i — |
i 5,859 |
i — |
i 5,859 |
|||||||||||||||
Assets held for sale related to discontinued operations |
i — |
i — |
i 5,015 |
i — |
i 5,015 |
|||||||||||||||
Total assets |
$ |
i 12,599 |
$ |
i 13,126 |
$ |
i 99,622 |
$ |
( i 24,424 |
) |
$ |
i 100,923 |
|||||||||
Liabilities and equity |
||||||||||||||||||||
Liabilities: |
||||||||||||||||||||
Future policy benefits |
$ |
i — |
$ |
i — |
$ |
i 37,940 |
$ |
i — |
$ |
i 37,940 |
||||||||||
Policyholder account bal ances |
i — |
i — |
i 22,968 |
i — |
i 22,968 |
|||||||||||||||
Liability for policy and contract claims |
i — |
i — |
i 10,295 |
i — |
i 10,295 |
|||||||||||||||
Unearned premiums |
i — |
i — |
i 2,013 |
i — |
i 2,013 |
|||||||||||||||
Other liabilities |
i 27 |
i 97 |
i 1,412 |
( i 7 |
) |
i 1,529 |
||||||||||||||
Intercompany notes payable |
i 122 |
i 207 |
i 57 |
( i 386 |
) |
i — |
||||||||||||||
Non-recourse funding obligations |
i — |
i — |
i 311 |
i — |
i 311 |
|||||||||||||||
Long-term borrowings |
i — |
i 3,567 |
i 140 |
i — |
i 3,707 |
|||||||||||||||
Separate account liabilities |
i — |
i — |
i 5,859 |
i — |
i 5,859 |
|||||||||||||||
Liabilities held for sale related to discontinued operations |
i — |
i — |
i 2,112 |
i — |
i 2,112 |
|||||||||||||||
Total liabilities |
i 149 |
i 3,871 |
i 83,107 |
( i 393 |
) |
i 86,734 |
||||||||||||||
Equity: |
||||||||||||||||||||
Common stock |
i 1 |
— |
i 3 |
( i 3 |
) |
i 1 |
||||||||||||||
Additional paid-in capital |
i 11,987 |
i 9,095 |
i 18,425 |
( i 27,520 |
) |
i 11,987 |
||||||||||||||
Accumulated other comprehensive income (loss) |
i 2,044 |
i 2,144 |
i 2,060 |
( i 4,204 |
) |
i 2,044 |
||||||||||||||
Retained earnings |
i 1,118 |
( i 1,984 |
) |
( i 6,012 |
) |
i 7,996 |
i 1,118 |
|||||||||||||
Treasury stock, at cost |
( i 2,700 |
) |
i — |
i — |
i — |
( i 2,700 |
) | |||||||||||||
Total Genworth Financial, Inc.’s stockholders’ equity |
i 12,450 |
i 9,255 |
i 14,476 |
( i 23,731 |
) |
i 12,450 |
||||||||||||||
Noncontrolling interests |
i — |
i — |
i 2,039 |
( i 300 |
) |
i 1,739 |
||||||||||||||
Total equity |
i 12,450 |
i 9,255 |
i 16,515 |
( i 24,031 |
) |
i 14,189 |
||||||||||||||
Total liabilities and equity |
$ |
i 12,599 |
$ |
i 13,126 |
$ |
i 99,622 |
$ |
( i 24,424 |
) |
$ |
i 100,923 |
|||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | i — |
$ | i — |
$ | i 4,037 |
$ | i — |
$ | i 4,037 |
||||||||||
Net investment income |
( i 3 |
) | i 10 |
i 3,228 |
( i 15 |
) | i 3,220 |
|||||||||||||
Net investment gains (losses) |
i — |
( i 5 |
) | i 55 |
i — |
i 50 |
||||||||||||||
Policy fees and other income |
i — |
i 2 |
i 792 |
( i 5 |
) | i 789 |
||||||||||||||
Total revenues |
( i 3 |
) | i 7 |
i 8,112 |
( i 20 |
) | i 8,096 |
|||||||||||||
Benefits and expenses: |
||||||||||||||||||||
Benefits and other changes in policy reserves |
i — |
i — |
i 5,163 |
i — |
i 5,163 |
|||||||||||||||
Interest credited |
i — |
i — |
i 577 |
i — |
i 577 |
|||||||||||||||
Acquisition and operating expenses, net of deferrals |
i 20 |
i — |
i 942 |
i — |
i 962 |
|||||||||||||||
Amortization of deferred acquisition costs and intangibles |
i — |
i — |
i 441 |
i — |
i 441 |
|||||||||||||||
Interest expense |
i 3 |
i 231 |
i 25 |
( i 20 |
) | i 239 |
||||||||||||||
Total benefits and expenses |
i 23 |
i 231 |
i 7,148 |
( i 20 |
) | i 7,382 |
||||||||||||||
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries |
( i 26 |
) | ( i 224 |
) | i 964 |
i — |
i 714 |
|||||||||||||
Provision (benefit) for income taxes |
( i 3 |
) | ( i 45 |
) | i 243 |
i — |
i 195 |
|||||||||||||
Equity in income of subsidiaries |
i 366 |
i 177 |
i — |
( i 543 |
) | i — |
||||||||||||||
Income (loss) from continuing operations |
i 343 |
( i 2 |
) | i 721 |
( i 543 |
) | i 519 |
|||||||||||||
Income (loss) from discontinued operations, net of taxes |
i — |
( i 140 |
) | i 151 |
i — |
i 11 |
||||||||||||||
Net income (loss) |
i 343 |
( i 142 |
) | i 872 |
( i 543 |
) | i 530 |
|||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
i — |
i — |
i 64 |
i — |
i 64 |
|||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i — |
i — |
i 123 |
i — |
i 123 |
|||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 343 |
$ | ( i 142 |
) | $ | i 685 |
$ | ( i 543 |
) | $ | i 343 |
||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | i — |
$ | i — |
$ | i 3,994 |
$ | i — |
$ | i 3,994 |
||||||||||
Net investment income |
( i 3 |
) | i 14 |
i 3,125 |
( i 15 |
) | i 3,121 |
|||||||||||||
Net investment gains (losses) |
i — |
i 16 |
( i 25 |
) | i — |
( i 9 |
) | |||||||||||||
Policy fees and other income |
i — |
i — |
i 798 |
( i 3 |
) | i 795 |
||||||||||||||
Total revenues |
( i 3 |
) | i 30 |
i 7,892 |
( i 18 |
) | i 7,901 |
|||||||||||||
Benefits and expenses: |
||||||||||||||||||||
Benefits and other changes in policy reserves |
i — |
i — |
i 5,606 |
i — |
i 5,606 |
|||||||||||||||
Interest credited |
i — |
i — |
i 611 |
i — |
i 611 |
|||||||||||||||
Acquisition and operating expenses, net of deferrals |
i 33 |
i 10 |
i 900 |
i — |
i 943 |
|||||||||||||||
Amortization of deferred acquisition costs and intangibles |
i — |
i — |
i 348 |
i — |
i 348 |
|||||||||||||||
Interest expense |
i 2 |
i 243 |
i 29 |
( i 18 |
) | i 256 |
||||||||||||||
Total benefits and expenses |
i 35 |
i 253 |
i 7,494 |
( i 18 |
) | i 7,764 |
||||||||||||||
Income (loss) from continuing operations before income taxes and equity in income (loss) of subsidiaries |
( i 38 |
) | ( i 223 |
) | i 398 |
i — |
i 137 |
|||||||||||||
Provision (benefit) for income taxes |
( i 6 |
) | ( i 39 |
) | i 115 |
i — |
i 70 |
|||||||||||||
Equity in income (loss) of subsidiaries |
i 151 |
( i 176 |
) | i — |
i 25 |
i — |
||||||||||||||
Income (loss) from continuing operations |
i 119 |
( i 360 |
) | i 283 |
i 25 |
i 67 |
||||||||||||||
Income (loss) from discontinued operations, net of taxes |
i — |
( i 20 |
) | i 250 |
i — |
i 230 |
||||||||||||||
Net income (loss) |
i 119 |
( i 380 |
) | i 533 |
i 25 |
i 297 |
||||||||||||||
Less: net income from continuing operations attributable to noncontrolling interests |
i — |
i — |
i 70 |
i — |
i 70 |
|||||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i — |
i — |
i 108 |
i — |
i 108 |
|||||||||||||||
Net income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 119 |
$ | ( i 380 |
) | $ | i 355 |
$ | i 25 |
$ | i 119 |
|||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Revenues: |
||||||||||||||||||||
Premiums |
$ | i — |
$ | i — |
$ | i 3,485 |
$ | i — |
$ | i 3,485 |
||||||||||
Net investment income |
( i 3 |
) | i 8 |
i 3,076 |
( i 15 |
) | i 3,066 |
|||||||||||||
Net investment gains (losses) |
i — |
( i 14 |
) | i 151 |
i — |
i 137 |
||||||||||||||
Policy fees and other income |
i — |
i 5 |
i 822 |
( i 2 |
) | i 825 |
||||||||||||||
Total revenues |
( i 3 |
) | ( i 1 |
) | i 7,534 |
( i 17 |
) | i 7,513 |
||||||||||||
Benefits and expenses: |
||||||||||||||||||||
Benefits and other changes in policy reserves |
i — |
i — |
i 5,125 |
i — |
i 5,125 |
|||||||||||||||
Interest credited |
i — |
i — |
i 646 |
i — |
i 646 |
|||||||||||||||
Acquisition and operating expenses, net of deferrals |
i 57 |
( i 2 |
) | i 902 |
i — |
i 957 |
||||||||||||||
Amortization of deferred acquisition costs and intangibles |
i — |
i — |
i 392 |
i — |
i 392 |
|||||||||||||||
Interest expense |
i 1 |
i 254 |
i 28 |
( i 17 |
) | i 266 |
||||||||||||||
Total benefits and expenses |
i 58 |
i 252 |
i 7,093 |
( i 17 |
) | i 7,386 |
||||||||||||||
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries |
( i 61 |
) | ( i 253 |
) | i 441 |
i — |
i 127 |
|||||||||||||
Benefit for income taxes |
i — |
( i 67 |
) | ( i 339 |
) | i — |
( i 406 |
) | ||||||||||||
Equity in income of subsidiaries |
i 878 |
i 771 |
i — |
( i 1,649 |
) | i — |
||||||||||||||
Income from continuing operations |
i 817 |
i 585 |
i 780 |
( i 1,649 |
) | i 533 |
||||||||||||||
Income from discontinued operations, net of taxes |
i — |
i 4 |
i 390 |
i — |
i 394 |
|||||||||||||||
Net income |
i 817 |
i 589 |
i 1,170 |
( i 1,649 |
) | i 927 |
||||||||||||||
Less: net loss from continuing operations attributable to noncontrolling interests |
i — |
i — |
( i 80 |
) | i — |
( i 80 |
) | |||||||||||||
Less: net income from discontinued operations attributable to noncontrolling interests |
i — |
i — |
i 190 |
i — |
i 190 |
|||||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | i 817 |
$ | i 589 |
$ | i 1,060 |
$ | ( i 1,649 |
) | $ | i 817 |
|||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Net income (loss) |
$ | i 343 |
$ | ( i 142 |
) | $ | i 872 |
$ | ( i 543 |
) | $ | i 530 |
||||||||
Other comprehensive income (loss), net of taxes: |
|
|
|
|
|
|||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
i 859 |
i 842 |
i 846 |
( i 1,701 |
) | i 846 |
||||||||||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities |
i 2 |
i 2 |
i 2 |
( i 4 |
) | i 2 |
||||||||||||||
Derivatives qualifying as hedges |
i 221 |
i 221 |
i 247 |
( i 468 |
) | i 221 |
||||||||||||||
Foreign currency translation and other adjustments |
i 307 |
i 224 |
i 486 |
( i 530 |
) | i 487 |
||||||||||||||
|
||||||||||||||||||||
Total other comprehensive income (loss) |
i 1,389 |
i 1,289 |
i 1,581 |
( i 2,703 |
) | i 1,556 |
||||||||||||||
|
||||||||||||||||||||
Total comprehensive income |
i 1,732 |
i 1,147 |
i 2,453 |
( i 3,246 |
) | i 2,086 |
||||||||||||||
Less: comprehensive income attributable to noncontrolling interests |
i — |
i — |
i 354 |
i — |
i 354 |
|||||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders |
$ | i 1,732 |
$ | i 1,147 |
$ | i 2,099 |
$ | ( i 3,246 |
) | $ | i 1,732 |
|||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Net income (loss) |
$ | i 119 |
$ | ( i 380 |
) | $ | i 533 |
$ | i 25 |
$ | i 297 |
|||||||||
Other comprehensive income (loss), net of taxes: |
||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
( i 652 |
) | ( i 602 |
) | ( i 669 |
) | i 1,254 |
( i 669 |
) | |||||||||||
Net unrealized gains (losses) on other-than- temporarily impaired securities |
( i 2 |
) | ( i 2 |
) | ( i 2 |
) | i 4 |
( i 2 |
) | |||||||||||
Derivatives qualifying as hedges |
( i 298 |
) | ( i 299 |
) | ( i 310 |
) | i 609 |
( i 298 |
) | |||||||||||
Foreign currency translation and other adjustments |
( i 162 |
) | ( i 129 |
) | ( i 301 |
) | i 291 |
( i 301 |
) | |||||||||||
|
||||||||||||||||||||
Total other comprehensive income (loss) |
( i 1,114 |
) | ( i 1,032 |
) | ( i 1,282 |
) | i 2,158 |
( i 1,270 |
) | |||||||||||
Total comprehensive loss |
( i 995 |
) | ( i 1,412 |
) | ( i 749 |
) | i 2,183 |
( i 973 |
) | |||||||||||
Less: comprehensive income attributable to noncontrolling interests |
i — |
i — |
i 22 |
i — |
i 22 |
|||||||||||||||
Total comprehensive loss available to Genworth Financial, Inc.’s common stockholders |
$ | ( i 995 |
) | $ | ( i 1,412 |
) | $ | ( i 771 |
) | $ | i 2,183 |
$ | ( i 995 |
) | ||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Net income |
$ | i 817 |
$ | i 589 |
$ | i 1,170 |
$ | ( i 1,649 |
) | $ | i 927 |
|||||||||
Other comprehensive income (loss), net of taxes: |
||||||||||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
( i 178 |
) | ( i 189 |
) | ( i 187 |
) | i 367 |
( i 187 |
) | |||||||||||
Net unrealized gains (losses) on other-than- temporarily impaired securities |
i 1 |
i 1 |
i 1 |
( i 2 |
) | i 1 |
||||||||||||||
Derivatives qualifying as hedges |
( i 20 |
) | ( i 19 |
) | ( i 19 |
) | i 38 |
( i 20 |
) | |||||||||||
Foreign currency translation and other adjustments |
i 130 |
i 109 |
i 252 |
( i 240 |
) | i 251 |
||||||||||||||
|
||||||||||||||||||||
Total other comprehensive income (loss) |
( i 67 |
) | ( i 98 |
) | i 47 |
i 163 |
i 45 |
|||||||||||||
Total comprehensive income |
i 750 |
i 491 |
i 1,217 |
( i 1,486 |
) | i 972 |
||||||||||||||
Less: comprehensive income attributable to noncontrolling interests |
i — |
i — |
i 222 |
i — |
i 222 |
|||||||||||||||
Total comprehensive income available to Genworth Financial, Inc.’s common stockholders |
$ | i 750 |
$ | i 491 |
$ | i 995 |
$ | ( i 1,486 |
) | $ | i 750 |
|||||||||
Parent |
All Other |
|||||||||||||||||||
(Amounts in millions) |
Guarantor |
Issuer |
Eliminations |
Consolidated |
||||||||||||||||
Cash flows from operating activities: |
||||||||||||||||||||
Net income (loss) |
$ | i 343 |
$ | ( i 142 |
) | $ | i 872 |
$ | ( i 543 |
) | $ | i 530 |
||||||||
Less (income) loss from discontinued operations, net of taxes |
i — |
i 140 |
( i 151 |
) | i — |
( i 11 |
) | |||||||||||||
Adjustments to reconcile net income (loss) to net cash from operating activities: |
||||||||||||||||||||
Equity in income from subsidiaries |
( i 366 |
) | ( i 177 |
) | i — |
i 543 |
i — |
|||||||||||||
Dividends from subsidiaries |
i 250 |
i 1,352 |
( i 1,602 |
) | i — |
i — |
||||||||||||||
Amortization of fixed maturity securities discounts and premiums |
i — |
i 8 |
( i 126 |
) | i — |
( i 118 |
) | |||||||||||||
Net investment (gains) losses |
i — |
i 5 |
( i 55 |
) | i — |
( i 50 |
) | |||||||||||||
Charges assessed to policyholders |
i — |
i — |
( i 699 |
) | i — |
( i 699 |
) | |||||||||||||
Acquisition costs deferred |
i — |
i — |
( i 27 |
) | i — |
( i 27 |
) | |||||||||||||
Amortization of deferred acquisition costs and intangibles |
i — |
i — |
i 441 |
i — |
i 441 |
|||||||||||||||
Deferred income taxes |
i 1 |
i 132 |
i 6 |
i — |
i 139 |
|||||||||||||||
Derivative instruments and limited partnerships |
|
|
i — |
|
|
|
( i 35 |
) |
|
|
( i 63 |
) |
|
|
i — |
|
|
|
( i 98 |
) |
Stock-based compensation expense |
i 26 |
i — |
i 1 |
i — |
i 27 |
|||||||||||||||
Change in certain assets and liabilities: |
|
|
|
|
|
|||||||||||||||
Accrued investment income and other assets |
i — |
i 7 |
( i 365 |
) | i — |
( i 358 |
) | |||||||||||||
Insurance reserves |
i — |
i — |
i 1,259 |
i — |
i 1,259 |
|||||||||||||||
Current tax liabilities |
i 16 |
( i 43 |
) | i 53 |
i — |
i 26 |
||||||||||||||
Other liabilities, policy and contract claims and other policy-related balances |
( i 17 |
) | ( i 44 |
) | i 668 |
i 2 |
i 609 |
|||||||||||||
Cash from operating activities—discontinued operations |
i — |
i 134 |
i 275 |
i — |
i 409 |
|||||||||||||||
Net cash from operating activities |
i 253 |
i 1,337 |
i 487 |
i 2 |
i 2,079 |
|||||||||||||||
Cash flows from (used by) investing activities: |
||||||||||||||||||||
Proceeds from maturities and repayments of investments: |
||||||||||||||||||||
Fixed maturity securities |
i — |
i — |
i 3,436 |
i — |
i 3,436 |
|||||||||||||||
Commercial mortgage loans |
i — |
i — |
i 582 |
i — |
i 582 |
|||||||||||||||
Restricted commercial mortgage loans related to a securitization entity |
i — |
i — |
i 15 |
i — |
i 15 |
|||||||||||||||
Proceeds from sales of investments: |
||||||||||||||||||||
Fixed maturity and equity securities |
i — |
i — |
i 3,883 |
i — |
i 3,883 |
|||||||||||||||
Purchases and originations of investments: |
||||||||||||||||||||
Fixed maturity and equity securities |
i — |
i — |
( i 6,899 |
) | i — |
( i 6,899 |
) | |||||||||||||
Commercial mortgage loans |
i — |
i — |
( i 813 |
) | i — |
( i 813 |
) | |||||||||||||
Other invested assets, net |
i — |
i 5 |
( i 392 | ) |
( i 2 |
) |
( i 389 |
) | ||||||||||||
Policy loans, net |
i — |
i — |
i 62 |
i — |
i 62 |
|||||||||||||||
Intercompany notes receivable |
( i 119 |
) | i 48 |
i 6 |
i 65 |
i — |
||||||||||||||
Capital contributions to subsidiaries |
( i 5 |
) | i — |
i 5 |
i — |
i — |
||||||||||||||
Proceeds from sale of business, net of cash transferred |
|
|
i — |
|
|
|
i — |
|
|
|
i 1,398 |
|
|
|
i — |
|
|
|
i 1,398 |
|
Cash from investing activities—discontinued operations |
i — |
i — |
i 26 |
i — |
i 26 |
|||||||||||||||
Net cash from ( used by) investing activities |
( i 124 |
) | i 53 |
i 1,309 |
i 63 |
i 1,301 |
||||||||||||||
Cash flows used by financing activities: |
||||||||||||||||||||
Deposits to universal life and investment contracts |
i — |
i — |
i 824 |
i — |
i 824 |
|||||||||||||||
Withdrawals from universal life and investment contracts |
i — |
i — |
( i 2,319 |
) | i — |
( i 2,319 |
) | |||||||||||||
Repayment and repurchase of long-term debt |
i — |
( i 446 |
) | i — |
i — |
( i 446 |
) | |||||||||||||
Intercompany notes payable |
( i 122 |
) | i 112 |
i 75 |
( i 65 |
) | i — |
|||||||||||||
Repurchase of subsidiary shares |
i — |
i — |
( i 22 |
) | i — |
( i 22 |
) | |||||||||||||
Dividends paid to noncontrolling interests |
i — |
i — |
( i 87 |
) | i — |
( i 87 |
) | |||||||||||||
Other, net |
( i 7 |
) | ( i 24 |
) | ( i 4 |
) | i — |
( i 35 |
) | |||||||||||
Cash used by financing activities— |
i — |
i — |
( i 132 |
) | i — |
( i 132 |
) | |||||||||||||
Net cash used by financing activities |
( i 129 |
) | ( i 358 |
) | ( i 1,665 |
) | ( i 65 |
) | ( i 2,217 |
) | ||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash (includes $ i 6 related to discontinued operations) |
i — |
i — |
i 1 |
i — |
i 1 |
|||||||||||||||
Net change in cash, cash equivalents and restricted cash |
|
|
i — |
|
|
|
i 1,032 |
|
|
|
i 132 |
|
|
|
i — |
|
|
|
i 1,164 |
|
Cash, cash equivalents and restricted cash at beginning of period |
i — |
i 429 |
i 1,748 |
i — |
i 2,177 |
|||||||||||||||
Cash, cash equivalents and restricted cash at end of period |
i — |
i 1,461 |
i 1,880 |
i — |
i 3,341 |
|||||||||||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period |
i — |
i — |
i — |
i — |
i — |
|||||||||||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period |
$ | i — |
$ | i 1,461 |
$ | i 1,880 |
$ | i — |
$ | i 3,341 |
||||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Cash flows from (used by) operating activities: |
||||||||||||||||||||
Net income (loss) |
$ |
i 119 |
$ |
( i 380 |
) |
$ |
i 533 |
$ |
i 25 |
$ |
i 297 |
|||||||||
Less (income) loss from discontinued operations, net of taxes |
i — |
i 20 |
( i 250 |
) |
i — |
( i 230 |
) | |||||||||||||
Adjustments to reconcile net income (loss) to net cash from (used by) operating activities: |
||||||||||||||||||||
Equity in (income) loss from subsidiaries |
( i 151 |
) |
i 176 |
i — |
( i 25 |
) |
i — |
|||||||||||||
Dividends from subsidiaries |
i 50 |
i 101 |
( i 151 |
) |
i — |
— |
||||||||||||||
Amortization of fixed maturity securities discounts and premiums |
i — |
i — |
( i 130 |
) |
i — |
( i 130 |
) | |||||||||||||
Net investment (gains) losses |
i — |
( i 16 |
) |
i 25 |
i — |
i 9 |
||||||||||||||
Charges assessed to policyholders |
i — |
i — |
( i 697 |
) |
i — |
( i 697 |
) | |||||||||||||
Acquisition costs deferred |
i — |
i — |
( i 42 |
) |
i — |
( i 42 |
) | |||||||||||||
Amortization of deferred acquisition costs and intangibles |
i — |
i — |
i 348 |
i — |
i 348 |
|||||||||||||||
Deferred income taxes |
i 13 |
( i 100 |
) |
i 115 |
i — |
i 28 |
||||||||||||||
Derivative instruments and limited partnerships |
i — |
i 17 |
( i 277 |
) |
i — |
( i 260 |
) | |||||||||||||
Stock-based compensation expense |
i 35 |
i — |
i — |
i — |
i 35 |
|||||||||||||||
Change in certain assets and liabilities: |
||||||||||||||||||||
Accrued investment income and other assets |
i — |
i 6 |
( i 172 |
) |
i — |
( i 166 |
) | |||||||||||||
Insurance reserves |
i — |
i — |
i 1,555 |
i — |
i 1,555 |
|||||||||||||||
Current tax liabilities |
( i 35 |
) |
i 13 |
i 30 |
i — |
i 8 |
||||||||||||||
Other liabilities, policy and contract claims and other policy-related balances |
( i 13 |
) |
( i 11 |
) |
i 620 |
i 2 |
i 598 |
|||||||||||||
Cash from operating activities-discontinued operations |
i — |
i 81 |
i 199 |
i — |
i 280 |
|||||||||||||||
Net cash from (used by) operating activities |
i 18 |
( i 93 |
) |
i 1,706 |
i 2 |
i 1,633 |
||||||||||||||
Cash flows used by investing activities: |
||||||||||||||||||||
Proceeds from maturities and repayments of investments: |
||||||||||||||||||||
Fixed maturity securities |
i — |
i — |
i 3,312 |
i — |
i 3,312 |
|||||||||||||||
Commercial mortgage loans |
i — |
i — |
i 701 |
i — |
i 701 |
|||||||||||||||
Restricted commercial mortgage loans related to a securitization entity |
i — |
i — |
i 45 |
i — |
i 45 |
|||||||||||||||
Proceeds from sales of investments: |
||||||||||||||||||||
Fixed maturity and equity securities |
i — |
i — |
i 5,488 |
i — |
i 5,488 |
|||||||||||||||
Purchases and originations of investments: |
||||||||||||||||||||
Fixed maturity and equity securities |
i — |
i — |
( i 9,386 |
) |
i — |
( i 9,386 |
) | |||||||||||||
Commercial mortgage loans |
i — |
i — |
( i 1,047 |
) |
i — |
( i 1,047 |
) | |||||||||||||
Other invested assets, net |
i — |
i — |
i 263 |
( i 2 |
) |
i 261 |
||||||||||||||
Policy loans, net |
i — |
i — |
i 35 |
i — |
i 35 |
|||||||||||||||
Intercompany notes receivable |
i — |
( i 25 |
) |
i 53 |
( i 28 |
) |
i — |
|||||||||||||
Capital contributions to subsidiaries |
( i 6 |
) |
i — |
i 6 |
i — |
i — |
||||||||||||||
Cash used by investing activities-discontinued operations |
i — |
i — |
( i 31 |
) |
i — |
( i 31 |
) | |||||||||||||
Net cash used by investing activities |
( i 6 |
) |
( i 25 |
) |
( i 561 |
) |
( i 30 |
) |
( i 622 |
) | ||||||||||
Cash flows used by financing activities: |
||||||||||||||||||||
Deposits to universal life and investment contracts |
i — |
i — |
i 1,193 |
i — |
i 1,193 |
|||||||||||||||
Withdrawals from universal life and investment contracts |
i — |
i — |
( i 2,355 |
) |
i — |
( i 2,355 |
) | |||||||||||||
Proceeds from the issuance of long-term debt |
i — |
i 441 |
i — |
i — |
i 441 |
|||||||||||||||
Repayment and repurchase of long-term debt |
i — |
( i 600 |
) |
i — |
i — |
( i 600 |
) | |||||||||||||
Repayment of borrowings related to a securitization entity |
i — |
i — |
( i 40 |
) |
i — |
( i 40 |
) | |||||||||||||
Intercompany notes payable |
( i 10 |
) |
( i 52 |
) |
i 34 |
i 28 |
i — |
|||||||||||||
Repurchase of subsidiary shares |
i — |
i — |
( i 55 |
) |
i — |
( i 55 |
) | |||||||||||||
Dividends paid to noncontrolling interests |
i — |
i — |
( i 40 |
) |
i — |
( i 40 |
) | |||||||||||||
Other, net |
( i 2 |
) |
( i 37 |
) |
( i 17 |
) |
i — |
( i 56 |
) | |||||||||||
Cash used by financing activities-discontinued operations |
i — |
i — |
( i 109 |
) |
i — |
( i 109 |
) | |||||||||||||
Net cash used by financing activities |
( i 12 |
) |
( i 248 |
) |
( i 1,389 |
) |
i 28 |
( i 1,621 |
) | |||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash (includes $( i 25) related to discontinued operations) |
i — |
i — |
( i 88 |
) |
i — |
( i 88 |
) | |||||||||||||
Net change in cash, cash equivalents and restricted cash |
i — |
( i 366 |
) |
( i 332 |
) |
i — |
( i 698 |
) | ||||||||||||
Cash, cash equivalents and restricted cash at beginning of period |
i — |
i 795 |
i 2,080 |
i — |
i 2,875 |
|||||||||||||||
Cash, cash equivalents and restricted cash at end of period |
i — |
i 429 |
i 1,748 |
i — |
i 2,177 |
|||||||||||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period |
i — |
i — |
i 203 |
i — |
i 203 |
|||||||||||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period |
$ |
i — |
$ |
i 429 |
$ |
i 1,545 |
$ |
i — |
$ |
i 1,974 |
||||||||||
(Amounts in millions) |
Parent Guarantor |
Issuer |
All Other Subsidiaries |
Eliminations |
Consolidated |
|||||||||||||||
Cash flows from (used by) operating activities: |
||||||||||||||||||||
Net income |
$ |
i 817 |
$ |
i 589 |
$ |
i 1,170 |
$ |
( i 1,649 |
) |
$ |
i 927 |
|||||||||
Less income from discontinued operations, net of taxes |
i — |
( i 4 |
) |
( i 390 |
) |
i — |
( i 394 |
) | ||||||||||||
Adjustments to reconcile net income to net cash from (used by) operating activities: |
||||||||||||||||||||
Equity in income from subsidiaries |
( i 878 |
) |
( i 771 |
) |
i — |
i 1,649 |
i — |
|||||||||||||
Dividends from subsidiaries |
i — |
i 75 |
( i 75 |
) |
i — |
i — |
||||||||||||||
Amortization of fixed maturity securities discounts and premiums |
i — |
i 5 |
( i 161 |
) |
i — |
( i 156 |
) | |||||||||||||
Net investment (gains) losses |
i — |
i 14 |
( i 151 |
) |
i — |
( i 137 |
) | |||||||||||||
Charges assessed to policyholders |
i — |
i — |
( i 713 |
) |
i — |
( i 713 |
) | |||||||||||||
Acquisition costs deferred |
i — |
i — |
( i 46 |
) |
i — |
( i 46 |
) | |||||||||||||
Amortization of deferred acquisition costs and intangibles |
i — |
i — |
i 392 |
i — |
i 392 |
|||||||||||||||
Deferred income taxes |
i 10 |
i 7 |
( i 444 |
) |
i — |
( i 427 |
) | |||||||||||||
Trading securities and derivative instruments |
i — |
( i 44 |
) |
i 771 |
i — |
i 727 |
||||||||||||||
Stock-based compensation expense |
i 30 |
i — |
i 1 |
i — |
i 31 |
|||||||||||||||
Change in certain assets and liabilities: |
||||||||||||||||||||
Accrued investment income and other assets |
i 5 |
( i 41 |
) |
i 68 |
i — |
i 32 |
||||||||||||||
Insurance reserves |
i — |
i — |
i 1,625 |
i — |
i 1,625 |
|||||||||||||||
Current tax liabilities |
i 23 |
( i 89 |
) |
i 41 |
i — |
( i 25 |
) | |||||||||||||
Other liabilities, policy and contract claims and other policy-related balances |
( i 35 |
) |
i 80 |
i 329 |
( i 4 |
) |
i 370 |
|||||||||||||
Cash from operating activities—discontinued operations |
i — |
i 73 |
i 275 |
i — |
i 348 |
|||||||||||||||
Net cash from (used by) operating activities |
( i 28 |
) |
( i 106 |
) |
i 2,692 |
( i 4 |
) |
i 2,554 |
||||||||||||
Cash flows used by investing activities: |
||||||||||||||||||||
Proceeds from maturities and repayments of investments: |
||||||||||||||||||||
Fixed maturity securities |
i — |
i — |
i 4,170 |
i — |
i 4,170 |
|||||||||||||||
Commercial mortgage loans |
i — |
i — |
i 579 |
i — |
i 579 |
|||||||||||||||
Restricted commercial mortgage loans related to a securitization entity |
i — |
i — |
i 22 |
i — |
i 22 |
|||||||||||||||
Proceeds from sales of investments: |
||||||||||||||||||||
Fixed maturity and equity securities |
i — |
i — |
i 3,788 |
i — |
i 3,788 |
|||||||||||||||
Purchases and originations of investments: |
||||||||||||||||||||
Fixed maturity and equity securities |
i — |
i — |
( i 7,800 |
) |
i — |
( i 7,800 |
) | |||||||||||||
Commercial mortgage loans |
i — |
i — |
( i 806 |
) |
i — |
( i 806 |
) | |||||||||||||
Other invested assets, net |
i — |
i 25 |
( i 707 |
) |
i 4 |
( i 678 |
) | |||||||||||||
Policy loans, net |
i — |
i — |
i 48 |
i — |
i 48 |
|||||||||||||||
Intercompany notes receivable |
i — |
( i 71 |
) |
i 8 |
i 63 |
i — |
||||||||||||||
Capital contributions to subsidiaries |
( i 12 |
) |
i — |
i 12 |
i — |
i — |
||||||||||||||
Payments for business purchased, net of cash acquired |
( i 7 |
) |
i — |
i 2 |
i — |
( i 5 |
) | |||||||||||||
Cash used by investing activities—discontinued operations |
i — |
i — |
( i 77 |
) |
i — |
( i 77 |
) | |||||||||||||
Net cash used by investing activities |
( i 19 |
) |
( i 46 |
) |
( i 761 |
) |
i 67 |
( i 759 |
) | |||||||||||
Cash flows from (used by) financing activities: |
||||||||||||||||||||
Deposits to universal life and investment contracts |
i — |
i — |
i 857 |
i — |
i 857 |
|||||||||||||||
Withdrawals from universal life and investment contracts |
i — |
i — |
( i 2,397 |
) |
i — |
( i 2,397 |
) | |||||||||||||
Repayment of borrowings related to securitization entities |
i — |
i — |
( i 34 |
) |
i — |
( i 34 |
) | |||||||||||||
Intercompany notes payable |
i 48 |
( i 8 |
) |
i 23 |
( i 63 |
) |
i — |
|||||||||||||
Repurchase of subsidiary shares |
i — |
i — |
( i 19 |
) |
i — |
( i 19 |
) | |||||||||||||
Dividends paid to noncontrolling interests |
i — |
i — |
( i 53 |
) |
i — |
( i 53 |
) | |||||||||||||
Other, net |
( i 1 |
) |
( i 43 |
) |
( i 9 |
) |
i — |
( i 53 |
) | |||||||||||
Cash used by financing activities—discontinued operations |
i — |
i — |
( i 69 |
) |
i — |
( i 69 |
) | |||||||||||||
Net cash from (used by) financing activities |
i 47 |
( i 51 |
) |
( i 1,701 |
) |
( i 63 |
) |
( i 1,768 |
) | |||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash (includes $23 related to discontinued operations) |
i — |
i — |
i 64 |
i — |
i 64 |
|||||||||||||||
Net change in cash, cash equivalents and restricted cash |
i — |
( i 203 |
) |
i 294 |
i — |
i 91 |
||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period |
i — |
i 998 |
i 1,786 |
i — |
i 2,784 |
|||||||||||||||
Cash, cash equivalents and restricted cash at end of period |
i — |
i 795 |
i 2,080 |
i — |
i 2,875 |
|||||||||||||||
Less cash, cash equivalents and restricted cash of discontinued operations at end of period |
i — |
i — |
i 229 |
i — |
i 229 |
|||||||||||||||
Cash, cash equivalents and restricted cash of continuing operations at end of period |
$ |
i — |
$ |
i 795 |
$ |
i 1,851 |
$ |
i — |
$ |
i 2,646 |
||||||||||
Type of investment |
Amortized |
Fair value |
Carrying value |
|||||||||
Fixed maturity securities: |
||||||||||||
Bonds: |
||||||||||||
U.S. government, agencies and authorities |
$ | i 4,073 |
$ | i 5,025 |
$ | i 5,025 |
||||||
State and political subdivisions |
i 2,394 |
i 2,747 |
i 2,747 |
|||||||||
Non-U.S. government |
i 1,235 |
i 1,350 |
i 1,350 |
|||||||||
Public utilities |
i 5,101 |
i 5,826 |
i 5,826 |
|||||||||
All other corporate bonds |
i 40,897 |
i 45,391 |
i 45,391 |
|||||||||
Total fixed maturity securities |
i 53,700 |
i 60,339 |
i 60,339 |
|||||||||
Equity securities |
i 233 |
i 239 |
i 239 |
|||||||||
Commercial mortgage loans ($ i 47 is restricted related to a securitization entity) |
i 6,963 |
xxxxx |
i 6,963 |
|||||||||
Policy loans |
i 2,058 |
xxxxx |
i 2,058 |
|||||||||
Other invested assets (1) |
i 1,406 |
xxxxx |
i 1,632 |
|||||||||
Total investments |
$ | i 64,360 |
xxxxx |
$ | i 71,231 |
|||||||
(1) |
The amount shown in the consolidated balance sheet for other invested assets differs from amortized cost or cost presented, as other invested assets include certain assets with a carrying amount that differs from amortized cost or cost. |
2018 |
||||||||
Assets |
||||||||
Investments in subsidiaries |
$ | i 14,079 |
$ | i 12,570 |
||||
Deferred tax asset |
i 13 |
i 14 |
||||||
Other assets |
i 4 |
i 15 |
||||||
Intercompany notes receivable |
|
|
i 119 |
|
|
|
i — |
|
Total assets |
$ | i 14,215 |
$ | i 12,599 |
||||
Liabilities and stockholders’ equity |
||||||||
Liabilities: |
||||||||
Other liabilities |
$ | i 30 |
$ | i 27 |
||||
Intercompany notes payable |
i — |
i 122 |
||||||
Total liabilities |
i 30 |
i 149 |
||||||
Commitments and contingencies |
i | i | ||||||
Stockholders’ equity: |
||||||||
Common stock |
i 1 |
i 1 |
||||||
Additional paid-in capital |
i 11,990 |
i 11,987 |
||||||
Accumulated other comprehensive income (loss): |
||||||||
Net unrealized investment gains (losses): |
||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
i 1,444 |
i 585 |
||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities |
i 12 |
i 10 |
||||||
Net unrealized investment gains (losses) |
i 1,456 |
i 595 |
||||||
Derivatives qualifying as hedges |
i 2,002 |
i 1,781 |
||||||
Foreign currency translation and other adjustments |
( i 25 |
) | ( i 332 |
) | ||||
Total accumulated other comprehensive income (loss) |
i 3,433 |
i 2,044 |
||||||
Retained earnings |
i 1,461 |
i 1,118 |
||||||
Treasury stock, at cost |
( i 2,700 |
) | ( i 2,700 |
) | ||||
Total Genworth Financial, Inc.’s stockholders’ equity |
i 14,185 |
i 12,450 |
||||||
Total liabilities and stockholders’ equity |
$ | i 14,215 |
$ | i 12,599 |
||||
Years ended December 31, |
||||||||||||
2018 |
2017 |
|||||||||||
Revenues: |
|
|
|
|
|
|
|
|
| |||
Net investment income |
$ |
( i 3 |
) |
$ |
( i 3 |
) |
$ |
( i 3 |
) | |||
Total revenues |
( i 3 |
) |
( i 3 |
) |
( i 3 |
) | ||||||
Expenses: |
|
|
|
|
|
|
|
|
| |||
Acquisition and operating expenses, net of deferrals |
i 20 |
i 33 |
i 57 |
|||||||||
Interest expense |
i 3 |
i 2 |
i 1 |
|||||||||
Total expenses |
i 23 |
i 35 |
i 58 |
|||||||||
Loss before income taxes and equity in income of subsidiaries |
( i 26 |
) | ( i 38 |
) | ( i 61 |
) | ||||||
Benefit from income taxes |
( i 3 |
) | ( i 6 |
) | i — |
|||||||
Equity in income of subsidiaries |
i 366 |
i 151 |
i 878 |
|||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | i 343 |
$ | i 119 |
$ | i 817 |
||||||
Years ended December 31, |
||||||||||||
2018 |
2017 |
|||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | i 343 |
$ | i 119 |
$ | i 817 |
||||||
Other comprehensive income (loss), net of taxes: |
||||||||||||
Net unrealized gains (losses) on securities not other-than-temporarily impaired |
i 859 |
( i 652 |
) | ( i 178 |
) | |||||||
Net unrealized gains (losses) on other-than-temporarily impaired securities |
i 2 |
( i 2 |
) | i 1 |
||||||||
Derivatives qualifying as hedges |
i 221 |
( i 298 |
) | ( i 20 |
) | |||||||
Foreign currency translation and other adjustments |
i 307 |
( i 162 |
) | i 130 |
||||||||
Total other comprehensive income (loss) |
i 1,389 |
( i 1,114 |
) | ( i 67 |
) | |||||||
Total comprehensive income (loss) available to Genworth Financial, Inc.’s common stockholders |
$ | i 1,732 |
$ | ( i 995 |
) | $ | i 750 |
|||||
Years ended December 31, |
||||||||||||
2018 |
2017 |
|||||||||||
Cash flows from (used by) operating activities: |
||||||||||||
Net income available to Genworth Financial, Inc.’s common stockholders |
$ | i 343 |
$ | i 119 |
$ | i 817 |
||||||
Adjustments to reconcile net income available to Genworth Financial, Inc.’s common stockholders to net cash from (used by) operating activities: |
||||||||||||
Equity in income from subsidiaries |
( i 366 |
) | ( i 151 |
) | ( i 878 |
) | ||||||
Dividends from subsidiaries |
i 250 |
i 50 |
i — |
|||||||||
Deferred income taxes |
i 1 |
i 13 |
i 10 |
|||||||||
Stock-based compensation expense |
i 26 |
i 35 |
i 30 |
|||||||||
Change in certain assets and liabilities: |
||||||||||||
Accrued investment income and other assets |
i — |
i — |
i 5 |
|||||||||
Current tax liabilities |
i 16 |
( i 35 |
) | i 23 |
||||||||
Other liabilities and other policy-related balances |
( i 17 |
) | ( i 13 |
) | ( i 35 |
) | ||||||
Net cash from (used by) operating activities |
i 253 |
i 18 |
( i 28 |
) | ||||||||
Cash flows used by investing activities: |
||||||||||||
Intercompany notes receivable |
|
|
( i 119 |
) |
|
|
i — |
|
|
|
i — |
|
Capital contributions paid to subsidiaries |
( i 5 |
) | ( i 6 |
) | ( i 12 |
) | ||||||
Payments for business purchased |
i — |
i — |
( i 7 |
) | ||||||||
Net cash used by investing activities |
( i 124 |
) | ( i 6 |
) | ( i 19 |
) | ||||||
Cash flows from (used by) financing activities: |
||||||||||||
Other, net |
( i 7 |
) | ( i 2 |
) | ( i 1 |
) | ||||||
Intercompany notes payable |
( i 122 |
) | ( i 10 |
) | i 48 |
|||||||
Net cash from (used by) financing activities |
( i 129 |
) | ( i 12 |
) | i 47 |
|||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
i — |
i — |
i — |
|||||||||
Cash, cash equivalents and restricted cash at beginning of year |
i — |
i — |
i — |
|||||||||
Cash, cash equivalents and restricted cash at end of year |
$ | i — |
$ | i — |
$ | i — |
||||||
Segment |
Deferred Acquisition Costs |
Future Policy Benefits |
Policyholder Account Balances |
Liability for Policy and Contract Claims |
Unearned Premiums |
|||||||||||||||
U.S. Mortgage Insurance |
$ | i 30 |
$ | — |
$ | — |
$ | i 233 |
$ | i 384 |
||||||||||
Australia Mortgage Insurance |
i 37 |
— |
— |
i 208 |
i 1,008 |
|||||||||||||||
U.S. Life Insurance |
i 1,613 |
i 40,382 |
i 19,006 |
i 10,500 |
i 498 |
|||||||||||||||
Runoff |
i 156 |
i 2 |
i 3,211 |
i 9 |
i 3 |
|||||||||||||||
Corporate and Other |
— |
— |
— |
i 8 |
— |
|||||||||||||||
Total |
$ | i 1,836 |
$ | i 40,384 |
$ | i 22,217 |
$ | i 10,958 |
$ | i 1,893 |
||||||||||
U.S. Mortgage Insurance |
$ | i 28 |
$ | — |
$ | — |
$ | i 296 |
$ | i 422 |
||||||||||
Australia Mortgage Insurance |
i 39 |
— |
— |
i 196 |
i 1,057 |
|||||||||||||||
U.S. Life Insurance |
i 2,879 |
i 37,939 |
i 19,663 |
i 9,782 |
i 530 |
|||||||||||||||
Runoff |
i 196 |
i 1 |
i 3,305 |
i 14 |
i 4 |
|||||||||||||||
Corporate and Other |
— |
— |
— |
i 7 |
— |
|||||||||||||||
Total |
$ | i 3,142 |
$ | i 37,940 |
$ | i 22,968 |
$ | i 10,295 |
$ | i 2,013 |
||||||||||
Segment |
Premium Revenue |
Net Investment Income |
Interest Credited and Benefits and Other Changes in Policy Reserves |
Amortization of Deferred Acquisition Costs |
Other Operating Expenses |
Premiums Written |
||||||||||||||||||
U.S. Mortgage Insurance |
$ | i 856 |
$ | i 117 |
$ | i 50 |
$ | i 8 |
$ | i 198 |
$ | i 818 |
||||||||||||
Australia Mortgage Insurance |
i 312 |
i 55 |
i 104 |
i 13 |
i 97 |
i 272 |
||||||||||||||||||
U.S. Life Insurance |
i 2,861 |
i 2,852 |
i 5,398 |
i 340 |
i 653 |
i 2,834 |
||||||||||||||||||
Runoff |
— |
i 187 |
i 185 |
i 16 |
i 54 |
— |
||||||||||||||||||
Corporate and Other |
i 8 |
i 9 |
i 3 |
— |
i 263 |
i 8 |
||||||||||||||||||
Total |
$ | i 4,037 |
$ | i 3,220 |
$ | i 5,740 |
$ | i 377 |
$ | i 1,265 |
$ | i 3,932 |
||||||||||||
U.S. Mortgage Insurance |
$ | i 746 |
$ | i 93 |
$ | i 36 |
$ | i 9 |
$ | i 174 |
$ | i 764 |
||||||||||||
Australia Mortgage Insurance |
i 373 |
i 67 |
i 110 |
i 16 |
i 101 |
i 242 |
||||||||||||||||||
U.S. Life Insurance |
i 2,867 |
i 2,781 |
i 5,877 |
i 218 |
i 639 |
i 2,843 |
||||||||||||||||||
Runoff |
— |
i 174 |
i 189 |
i 33 |
i 57 |
— |
||||||||||||||||||
Corporate and Other |
i 8 |
i 6 |
i 5 |
— |
i 300 |
i 8 |
||||||||||||||||||
Total |
$ | i 3,994 |
$ | i 3,121 |
$ | i 6,217 |
$ | i 276 |
$ | i 1,271 |
$ | i 3,857 |
||||||||||||
U.S. Mortgage Insurance |
$ | i 695 |
$ | i 73 |
$ | i 107 |
$ | i 10 |
$ | i 169 |
$ | i 757 |
||||||||||||
Australia Mortgage Insurance |
( i 140 |
) | i 75 |
i 109 |
( i 5 |
) | i 105 |
i 231 |
||||||||||||||||
U.S. Life Insurance |
i 2,922 |
i 2,755 |
i 5,386 |
i 272 |
i 641 |
i 2,902 |
||||||||||||||||||
Runoff |
— |
i 160 |
i 166 |
i 24 |
i 63 |
— |
||||||||||||||||||
Corporate and Other |
i 8 |
i 3 |
i 3 |
— |
i 336 |
i 7 |
||||||||||||||||||
Total |
$ | i 3,485 |
$ | i 3,066 |
$ | i 5,771 |
$ | i 301 |
$ | i 1,314 |
$ | i 3,897 |
||||||||||||
Item 9. |
Changes In and Disagreements With Accountants On Accounting and Financial Disclosure |
Item 9A. |
Controls and Procedures |
President and Chief Executive Officer |
(Principal Executive Officer) |
/s/ Kelly L. Groh |
Executive Vice President and Chief Financial Officer |
(Principal Financial Officer) |
Item 9B. |
Other Information |
Item 10. |
Directors, Executive Officers and Corporate Governance |
Name |
Age |
Positions | ||||
63 |
President and Chief Executive Officer, Director | |||||
51 |
Executive Vice President and Chief Financial Officer | |||||
Kevin D. Schneider |
58 |
Executive Vice President and Chief Operating Officer | ||||
Ward E. Bobitz |
55 |
Executive Vice President and General Counsel | ||||
Pamela M. Harrison |
55 |
Executive Vice President—Human Resources | ||||
Daniel J. Sheehan IV |
54 |
Executive Vice President—Chief Investment Officer | ||||
G. Kent Conrad |
71 |
Director, member of Nominating and Corporate Governance and Risk Committees | ||||
Melina E. Higgins |
52 |
Director, member of Management Development and Compensation and Nominating and Corporate Governance Committees | ||||
David M. Moffett |
68 |
Director, member of Management Development and Compensation and Nominating and Corporate Governance Committees | ||||
Thomas E. Moloney |
76 |
Director, member of Audit and Risk Committees | ||||
Debra J. Perry |
68 |
Director, member of Audit and Risk Committees | ||||
Robert P. Restrepo Jr. |
69 |
Director, member of Audit and Management Development and Compensation Committees | ||||
James S. Riepe |
76 |
Non-Executive Chairman of the Board, member of Audit and Management Development and Compensation Committees |
Item 15. |
Exhibits and Financial Statement Schedules |
|
a. Documents filed as part of this report. | |||
1. |
Financial Statements (see Item 8. Financial Statements and Supplementary Data) | |||
Report of KPMG LLP, Independent Registered Public Accounting Firm | ||||
Consolidated Balance Sheets as of December 31, 2019 and 2018 | ||||
| ||||
Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, 2018 and 2017 | ||||
| ||||
| ||||
Notes to Consolidated Financial Statements | ||||
2. |
Financial Statement Schedules | |||
Schedule I—Summary of Investments—Other Than Investments in Related Parties | ||||
Schedule II—Financial Statements of Genworth Financial, Inc. (Parent Only) | ||||
Schedule III—Supplemental Insurance Information |
3. | Exhibits |
Number |
Description | |||
2.1 |
||||
2.2 |
||||
2.3 |
||||
2.4 |
||||
2.5 |
||||
2.6 |
||||
2.6.1 |
Number |
Description | |||
2.6.2 |
||||
2.6.3 |
||||
2.6.4 |
||||
2.6.5 |
||||
2.6.6 |
||||
2.6.7 |
||||
2.6.8 |
||||
2.6.9 |
||||
2.6.10 |
||||
2.6.11 |
||||
2.6.12 |
||||
2.6.13 |
||||
2.7 |
Number |
Description | |||
3.1 |
||||
3.2 |
||||
4.1 |
||||
4.2 |
||||
4.3 |
||||
4.4 |
||||
4.5 |
||||
4.6 |
||||
4.7 |
||||
4.8 |
||||
4.9 |
||||
4.10 |
||||
4.11 |
Number |
Description | |||
4.12 |
||||
4.13 |
||||
4.14 |
||||
4.15 |
||||
10.1 |
||||
10.2 |
||||
10.2.1 |
||||
10.2.2 |
||||
10.3 |
||||
10.3.1 |
||||
10.4 |
||||
10.4.1 |
Number |
Description | |||
10.5 |
||||
10.5.1 |
||||
10.6 |
||||
10.6.1 |
||||
10.7 |
||||
10.7.1 |
||||
10.7.2 |
||||
10.8 |
||||
10.8.1 |
||||
10.8.2 |
||||
10.9 |
||||
10.9.1 |
||||
10.10 |
||||
10.10.1 |
||||
10.11 |
||||
10.11.1 |
Number |
Description | |||
10.11.2 |
||||
10.12 |
||||
10.12.1 |
||||
10.12.2 |
||||
10.13 |
||||
10.13.1 |
||||
10.13.2 |
||||
10.13.3 |
||||
10.14 |
||||
10.15 |
||||
10.16 |
||||
10.17 |
||||
10.18 |
||||
10.19 |
||||
10.20 |
Number |
Description | |||
10.21 |
||||
10.21.1 |
||||
10.22 |
||||
10.23 |
||||
10.24§ |
||||
10.24.1§ |
||||
10.24.2§ |
||||
10.25§ |
||||
10.26§ |
||||
10.27§ |
||||
10.28§ |
||||
10.28.1§ |
||||
10.28.2§ |
||||
10.29§ |
||||
10.29.1§ |
Number |
Description | |||
10.29.2§ |
||||
10.29.3§ |
||||
10.29.4§ |
||||
10.29.5§ |
||||
10.30§ |
||||
10.31§ |
||||
10.32§ |
||||
10.33§ |
||||
10.33.1§ |
||||
10.33.2§ |
||||
10.34§ |
||||
10.35§ |
||||
10.36§ |
||||
10.37§ |
||||
10.38§ |
Number |
Description | |||
10.39§ |
||||
10.40§ |
||||
10.41§ |
||||
10.42§ |
||||
10.43§ |
||||
10.44§ |
||||
10.45§ |
||||
10.46§ |
||||
10.47§ |
||||
10.48§ |
||||
10.49§ |
||||
10.50§ |
||||
21 |
||||
23 |
||||
24 |
||||
31.1 |
||||
31.2 |
Number |
Description | |||
32.1 |
||||
32.2 |
||||
101.INS |
Inline XBRL Instance Document | |||
101.SCH |
Inline XBRL Taxonomy Extension Schema Document | |||
101.CAL |
Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||
101.LAB |
Inline XBRL Taxonomy Extension Label Linkbase Document | |||
101.PRE |
Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||
101.DEF |
Inline XBRL Taxonomy Extension Definition Linkbase Document | |||
104 |
The cover page for the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, has been formatted in Inline XBRL |
§ | Management contract or compensatory plan or arrangement. |
GENWORTH FINANCIAL, INC. | ||
By: |
||
Name: |
||
Title: |
President and Chief Executive Officer; Director | |
(Principal Executive Officer) |
President and Chief Executive Officer; Director (Principal Executive Officer) | ||||
/s/ Kelly L. Groh |
Executive Vice President and Chief Financial Officer (Principal Financial Officer) | |||
Vice President and Controller (Principal Accounting Officer) | ||||
* G. Kent Conrad |
Director | |||
* Melina E. Higgins |
Director | |||
* David M. Moffett |
Director | |||
* Thomas E. Moloney |
Director | |||
* Debra J. Perry |
Director | |||
* Robert P. Restrepo Jr. |
Director | |||
* James S. Riepe |
Director | |||
*By |
||||
Attorney-in-Fact |
This ‘10-K’ Filing | Date | Other Filings | ||
---|---|---|---|---|
11/15/36 | ||||
9/1/22 | ||||
3/15/22 | ||||
1/1/22 | ||||
12/31/21 | ||||
1/1/21 | ||||
12/31/20 | ||||
7/10/20 | ||||
7/1/20 | 4 | |||
6/30/20 | 10-Q, 4, 8-K | |||
6/15/20 | ||||
3/31/20 | 10-Q, 4, 8-K | |||
Filed on: | 2/27/20 | 8-K | ||
2/19/20 | ||||
2/18/20 | 4 | |||
2/13/20 | 4 | |||
1/31/20 | ||||
1/21/20 | ||||
1/15/20 | ||||
1/10/20 | ||||
1/1/20 | ||||
For Period end: | 12/31/19 | 10-K/A, 11-K, 4 | ||
12/22/19 | 8-K | |||
12/17/19 | ||||
12/12/19 | 8-K, DEF 14A | |||
12/6/19 | ||||
12/1/19 | ||||
11/25/19 | ||||
11/12/19 | ||||
10/22/19 | ||||
10/21/19 | ||||
10/11/19 | ||||
9/30/19 | 10-Q, 4 | |||
9/20/19 | ||||
9/11/19 | ||||
9/6/19 | ||||
8/29/19 | ||||
8/12/19 | 8-K | |||
8/7/19 | ||||
7/25/19 | ||||
7/18/19 | ||||
7/3/19 | ||||
7/1/19 | 8-K | |||
6/30/19 | 10-Q, 8-K | |||
6/21/19 | 11-K | |||
6/19/19 | ||||
6/14/19 | ||||
5/21/19 | ||||
4/26/19 | ||||
4/8/19 | ||||
4/1/19 | 4 | |||
3/31/19 | 10-Q | |||
3/29/19 | 4 | |||
3/26/19 | ||||
3/15/19 | 4, 4/A | |||
3/12/19 | ||||
2/26/19 | 8-K | |||
2/25/19 | 4 | |||
2/13/19 | ||||
2/4/19 | ||||
1/29/19 | ||||
1/17/19 | ||||
1/1/19 | ||||
12/31/18 | 10-K, 10-K/A, 11-K, 4 | |||
12/13/18 | 8-K, DEF 14A | |||
12/6/18 | ||||
11/21/18 | ||||
11/15/18 | ||||
11/13/18 | ||||
10/29/18 | ||||
10/4/18 | 8-K | |||
10/3/18 | 8-K | |||
9/30/18 | 10-Q | |||
9/12/18 | ||||
8/3/18 | ||||
6/30/18 | 10-Q | |||
6/28/18 | 8-K | |||
6/21/18 | ||||
5/24/18 | ||||
5/22/18 | 4 | |||
3/31/18 | 10-Q | |||
3/7/18 | 8-K | |||
1/1/18 | 3 | |||
12/31/17 | 10-K, 10-K/A, 11-K, 4 | |||
12/22/17 | ||||
11/30/17 | ||||
10/24/17 | ||||
10/1/17 | ||||
9/22/17 | ||||
6/9/17 | ||||
4/1/17 | ||||
3/7/17 | 8-K | |||
3/1/17 | ||||
1/1/17 | ||||
12/31/16 | 10-K, 10-K/A, 11-K, 4 | |||
11/14/16 | ||||
10/21/16 | 8-K | |||
9/16/16 | ||||
5/27/16 | ||||
5/9/16 | ||||
4/6/16 | ||||
3/28/16 | ||||
3/7/16 | ||||
2/23/16 | 4 | |||
12/31/15 | 10-K, 11-K, 4 | |||
12/1/15 | 8-K | |||
5/15/15 | ||||
1/1/15 | ||||
5/21/14 | 8-K | |||
4/1/13 | 4, 8-K, POSASR, S-8 POS | |||
12/5/12 | 3, 8-K | |||
12/31/10 | 10-K, 11-K, 13F-HR, 4, ARS | |||
1/1/10 | ||||
1/1/06 | ||||
1/1/05 | ||||
6/15/04 | ||||
5/28/04 | 8-K | |||
9/11/01 | ||||
7/29/99 | ||||
List all Filings |
As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 4/11/24 Genworth Financial Inc. S-3ASR 4/11/24 8:323K Donnelley … Solutions/FA 2/29/24 Genworth Financial Inc. 10-K 12/31/23 217:65M Donnelley … Solutions/FA 2/28/23 Genworth Financial Inc. 10-K 12/31/22 178:62M Donnelley … Solutions/FA 2/28/22 Genworth Financial Inc. 10-K 12/31/21 191:54M Donnelley … Solutions/FA 4/12/21 Genworth Financial Inc. S-3ASR 4/12/21 7:347K Donnelley … Solutions/FA 2/26/21 Genworth Financial Inc. 10-K 12/31/20 185:54M Donnelley … Solutions/FA |