Long-duration Contracts

12 Months Ended

Dec. 31, 2023

12. Long-duration Contracts

Interest sensitive contract liabilities – Interest sensitive contract liabilities primarily include:

▪traditional deferred annuities,

▪indexed annuities consisting of fixed indexed and index-linked variable annuities,

▪funding agreements, and

▪other investment-type contracts comprising of immediate annuities without significant mortality risk (which includes pension group annuities without life contingencies) and assumed endowments without significant mortality risks.

The following represents a rollforward of the policyholder account balance by product within interest sensitive contract liabilities. Where explicit policyholder account balances do not exist, the disaggregated rollforward represents the recorded reserve.


	Year ended December 31, 2023
(In millions, except percentages)	Traditional deferred annuities			Indexed annuities			Funding agreements			Other investment-type			Total
Balance at December 31, 2022	$	43,518		$	92,660		$	27,439		$	4,722		$	168,339
Deposits	30,175			12,639			6,893			4,597			54,304
Policy charges	(2)			(651)			—			—			(653)
Surrenders and withdrawals	(9,929)			(11,253)			(110)			(40)			(21,332)
Benefit payments	(984)			(1,609)			(3,273)			(275)			(6,141)
Interest credited	1,858			1,279			883			155			4,175
Foreign exchange	52			1			260			(95)			218
Other1	75			81			258			(1,435)			(1,021)
Balance at December 31, 2023	$	64,763		$	93,147		$	32,350		$	7,629		$	197,889


Weighted average crediting rate	4.0		%	2.4		%	3.4		%	2.7		%
Net amount at risk	$	425		$	14,716		$	—		$	103
Cash surrender value	61,345			85,381			—			6,375

1 Other includes $1,371 million reduction of reserves related to the VIAC recapture agreement. See note 19 for further information.


	Year ended December 31, 2022
(In millions, except percentages)	Traditional deferred annuities			Indexed annuities			Funding agreements			Other investment-type			Total
Balance at January 1, 2022	$	35,599		$	89,755		$	23,623		$	2,413		$	151,390
Deposits	13,246			11,544			7,970			2,581			35,341
Policy charges	(3)			(600)			—			—			(603)
Surrenders and withdrawals	(5,419)			(8,057)			(880)			(17)			(14,373)
Benefit payments	(937)			(1,620)			(2,819)			(322)			(5,698)
Interest credited	1,032			1,638			677			95			3,442
Foreign exchange	—			—			(440)			(6)			(446)
Other	—			—			(692)			(22)			(714)
Balance at December 31, 2022	$	43,518		$	92,660		$	27,439		$	4,722		$	168,339


Weighted average crediting rate	3.2		%	2.2		%	2.5		%	3.1		%
Net amount at risk	$	422		$	13,581		$	—		$	47
Cash surrender value	41,273			84,724			—			2,213

The following is a reconciliation of interest sensitive contract liabilities to the consolidated statements of financial condition:


	December 31,
(In millions)	2023		2022
Traditional deferred annuities	$	64,763	$	43,518
Indexed annuities	93,147		92,660

Funding agreements	32,350		27,439
Other investment-type	7,629		4,722

Reconciling items1	6,781		5,277
Interest sensitive contract liabilities	$	204,670	$	173,616

1 Reconciling items primarily include embedded derivatives in indexed annuities, unaccreted host contract adjustments on indexed annuities, negative VOBA, sales inducement liabilities, and wholly ceded universal life insurance contracts.

The following represents policyholder account balances by range of guaranteed minimum crediting rates, as well as the related range of the difference between rates being credited to policyholders and the respective guaranteed minimums:


	December 31, 2023
(In millions)	At guaranteed minimum		1 basis point – 100 basis points above guaranteed minimum		Greater than 100 basis points above guaranteed minimum		Total




































< 2.0%	$	30,339	$	18,954	$	100,609	$	149,902
2.0% – < 4.0%	27,792		2,074		1,389		31,255
4.0% – < 6.0%	11,532		17		1		11,550
6.0% and greater	5,182		—		—		5,182
Total	$	74,845	$	21,045	$	101,999	$	197,889


	December 31, 2022
(In millions)	At guaranteed minimum		1 basis point – 100 basis points above guaranteed minimum		Greater than 100 basis points above guaranteed minimum		Total




































< 2.0%	$	25,031	$	26,020	$	72,776	$	123,827
2.0% – < 4.0%	33,325		1,408		284		35,017
4.0% – < 6.0%	8,277		10		6		8,293
6.0% and greater	1,202		—		—		1,202
Total	$	67,835	$	27,438	$	73,066	$	168,339

Future policy benefits – Future policy benefits consist primarily of payout annuities, including single premium immediate annuities with life contingencies (which include pension group annuities with life contingencies), and whole life insurance contracts.

The following is a rollforward by product within future policy benefits:


	Year ended December 31, 2023
(In millions, except percentages and years)	Payout annuities with life contingencies			Whole life			Total
Present value of expected net premiums
Beginning balance	$	—		$	—		$	—






Issuances	—			3,091			3,091
Interest accrual	—			6			6
Net premium collected	—			(2,027)			(2,027)
Foreign exchange	—			65			65
Ending balance at original discount rate	—			1,135			1,135
Effect of changes in discount rate assumptions	—			45			45
Effect of foreign exchange on the change in discount rate assumptions	—			2			2
Ending balance	$	—		$	1,182		$	1,182
Present value of expected future policy benefits
Beginning balance	$	36,422		$	—		$	36,422
Effect of changes in discount rate assumptions	8,425			—			8,425
Effect of foreign exchange on the change in discount rate assumptions	(13)			—			(13)
Beginning balance at original discount rate	44,834			—			44,834
Effect of changes in cash flow assumptions	(297)			—			(297)
Effect of actual experience to expected experience	(67)			—			(67)
Adjusted balance	44,470			—			44,470
Issuances	10,427			3,091			13,518
Interest accrual	1,646			18			1,664
Benefit payments	(3,834)			(18)			(3,852)
Foreign exchange	35			185			220
Other1	(1,509)			—			(1,509)
Ending balance at original discount rate	51,235			3,276			54,511
Effect of changes in discount rate assumptions	(6,233)			89			(6,144)
Effect of foreign exchange on the change in discount rate assumptions	(1)			6			5
Ending balance	$	45,001		$	3,371		$	48,372

Net future policy benefits	$	45,001		$	2,189		$	47,190




Weighted-average liability duration (in years)	9.5			33.5
Weighted-average interest accretion rate	3.6		%	4.8		%
Weighted-average current discount rate	5.1		%	4.1		%
Expected future gross premiums, undiscounted	$	—		$	1,497
Expected future gross premiums, discounted2	—			1,239
Expected future benefit payments, undiscounted	75,261			11,344

1 Other represents a $1,509 million reduction of reserves related to the VIAC recapture agreement. See note 19 for further information.
2 Discounted at the original discount rate.


	Year ended December 31, 2022
(In millions, except percentages and years)	Payout annuities with life contingencies			Whole life			Total
















Present value of expected future policy benefits
Beginning balance	$	35,278		$	—		$	35,278
Effect of changes in discount rate assumptions	—			—			—

Beginning balance at original discount rate	35,278			—			35,278

Effect of actual experience to expected experience	(120)			—			(120)
Adjusted balance	35,158			—			35,158
Issuances	11,528			—			11,528
Interest accrual	1,146			—			1,146
Benefit payments	(2,921)			—			(2,921)
Foreign exchange	(77)			—			(77)

Ending balance at original discount rate	44,834			—			44,834
Effect of changes in discount rate assumptions	(8,425)			—			(8,425)
Effect of foreign exchange on the change in discount rate assumptions	13			—			13
Ending balance	$	36,422		$	—		$	36,422

Net future policy benefits	$	36,422		$	—		$	36,422




Weighted-average liability duration (in years)	10.2			0.0
Weighted-average interest accretion rate	3.2		%	—		%
Weighted-average current discount rate	5.5		%	—		%


Expected future benefit payments, undiscounted	$	64,754		$	—

The following is a reconciliation of future policy benefits to the consolidated statements of financial condition:


	December 31,
(In millions)	2023		2022
Payout annuities with life contingencies	$	45,001	$	36,422
Whole life	2,189		—
Reconciling items1	6,097		5,688
Future policy benefits	$	53,287	$	42,110

1 Reconciling items primarily include the deferred profit liability and negative VOBA associated with the liability for future policy benefits. Additionally, it includes term life reserves, fully ceded whole life reserves, and reserves for immaterial lines of business including accident and health and disability, as well as other insurance benefit reserves for no-lapse guarantees with universal life contracts, all of which are fully ceded.

The following is a reconciliation of premiums and interest expense relating to future policy benefits to the consolidated statements of operations:


	Premiums				Interest expense
	Years ended December 31,				Years ended December 31,
(In millions)	2023		2022		2023		2022
Payout annuities with life contingencies	$	10,504	$	11,606	$	1,646	$	1,146
Whole life	2,214		—		12		—
Reconciling items1	31		32		—		—
Total	$	12,749	$	11,638	$	1,658	$	1,146

1 Reconciling items primarily relate to immaterial lines of business including term life, fully ceded whole life, and accident and health and disability.

Significant assumptions and inputs to the calculation of future policy benefits for payout annuities with life contingencies include policyholder demographic data, assumptions for policyholder longevity and policyholder utilization for contracts with deferred lives, and discount rates. For whole life products, significant assumptions and inputs include policyholder demographic data, assumptions for mortality, morbidity, and lapse and discount rates.

Athene bases certain key assumptions related to policyholder behavior on industry standard data adjusted to align with actual company experience, if necessary. At least annually, Athene reviews all significant cash flow assumptions and updates as necessary, unless emerging experience indicates a more frequent review is necessary. The discount rate reflects market observable inputs from upper-medium grade fixed income instrument yields and is interpolated, where necessary, to conform to the duration of Athene’s liabilities.

During the year ended December 31, 2023, the present value of expected future policy benefits increased by $11,950 million, which was driven by $13,518 million of issuances, primarily pension group annuities, $2,236 million change in discount rate assumptions related to a decrease in rates, and $1,664 million of interest accrual, partially offset by $3,852 million of benefit payments, $1,509 million reduction in reserve relating to recapture, and $297 million resulting from favorable unlocking of assumptions, primarily related to higher interest rates and favorable mortality experience lowering future benefit payments.

During the year ended December 31, 2022, the present value of expected future policy benefits increased by $1,144 million, which was driven by $11,528 million of issuances, primarily pension group annuities, and $1,146 million of interest accrual, partially offset by a $8,425 million change in discount rate assumptions related to an increase in rates and $2,921 million of benefit payments.

The following is a summary of remeasurement gains (losses) included within future policy and other policy benefits on the consolidated statements of operations:


	Years ended December 31,
(In millions)	2023		2022
Reserves	$	364	$	120
Deferred profit liability	(246)		(126)
Negative VOBA	(65)		21
Total remeasurement gains (losses)	$	53	$	15

During the years ended December 31, 2023 and 2022, Athene recorded reserve increases of $136 million and $50 million, respectively, on the consolidated statements of operations as a result of the present value of benefits and expenses exceeding the present value of gross premiums.

Market risk benefits – Athene issues and reinsures traditional deferred and indexed annuity products that contain GLWB and GMDB riders that meet the criteria to be classified as market risk benefits.

The following is a rollfoward of net market risk benefit liabilities by product:


	Year ended December 31, 2023
(In millions)	Traditional deferred annuities		Indexed annuities		Total
Balance at December 31, 2022	$	170	$	2,319	$	2,489
Effect of changes in instrument-specific credit risk	13		353		366
Balance, beginning of period, before changes in instrument-specific credit risk	183		2,672		2,855
Issuances	—		106		106
Interest accrual	10		147		157
Attributed fees collected	2		336		338
Benefit payments	(2)		(32)		(34)
Effect of changes in interest rates	(1)		(90)		(91)
Effect of changes in equity	—		(119)		(119)
Effect of actual policyholder behavior compared to expected behavior	5		67		72
Effect of changes in future expected policyholder behavior	(3)		78		75
Effect of changes in other future expected assumptions	—		6		6
Balance, end of period, before changes in instrument-specific credit risk	194		3,171		3,365
Effect of changes in instrument-specific credit risk	(2)		10		8
Balance at December 31, 2023	$	192	$	3,181	$	3,373




Net amount at risk	$	425	$	14,716
Weighted-average attained age of contract holders (in years)	75		69


	Year ended December 31, 2022
(In millions)	Traditional deferred annuities		Indexed annuities		Total
Balance at January 1, 2022	$	253	$	4,194	$	4,447


Issuances	—		60		60
Interest accrual	4		52		56
Attributed fees collected	3		330		333
Benefit payments	(4)		(49)		(53)
Effect of changes in interest rates	(77)		(2,092)		(2,169)
Effect of changes in equity	—		176		176
Effect of actual policyholder behavior compared to expected behavior	6		42		48

Effect of changes in other future expected assumptions	(2)		(41)		(43)
Balance, end of period, before changes in instrument-specific credit risk	183		2,672		2,855
Effect of changes in instrument-specific credit risk	(13)		(353)		(366)
Balance at December 31, 2022	$	170	$	2,319	$	2,489




Net amount at risk	$	422	$	13,581
Weighted-average attained age of contract holders (in years)	74		68

The following is a reconciliation of market risk benefits to the consolidated statements of financial condition. Market risk benefit assets are included in other assets on the consolidated statements of financial condition.


	December 31, 2023						December 31, 2022
(In millions)	Asset		Liability		Net liability		Asset		Liability		Net liability
Traditional deferred annuities	$	—	$	192	$	192	$	—	$	170	$	170
Indexed annuities	378		3,559		3,181		481		2,800		2,319





Total	$	378	$	3,751	$	3,373	$	481	$	2,970	$	2,489

During the year ended December 31, 2023, net market risk benefit liabilities increased by $884 million, which was primarily driven by $338 million in fees collected from policyholders, a $374 million change in instrument-specific credit risk related to tightening of credit spreads, $157 million of interest accrual, and issuances of $106 million, partially offset by $119 million of changes related to equity market performance and a decrease of $91 million related to changes in the risk-free discount rate across the curve.

During the year ended December 31, 2022, net market risk benefit liabilities decreased by $1,958 million, which was primarily driven by a decrease of $2,169 million related to changes in the risk-free discount rate across the curve and a $366 million change in instrument-specific credit risk related to widening of credit spreads, partially offset by $333 million of fees collected from policyholders and $176 million of changes related to equity market performance.

The determination of the fair value of market risk benefits requires the use of inputs related to fees and assessments and assumptions in determining the projected benefits in excess of the projected account balance. Judgment is required for both economic and actuarial assumptions, which can be either observable or unobservable, that impact future policyholder account growth.

Economic assumptions include interest rates and implied volatilities throughout the duration of the liability. For indexed annuities, assumptions also include projected equity returns which impact cash flows attributable to indexed strategies, implied equity volatilities, expected index credits on the next policy anniversary date and future equity option costs. Assumptions related to the level of option budgets used for determining the future equity option costs and the impact on future policyholder account value growth are considered unobservable inputs.

Policyholder behavior assumptions are unobservable inputs and are established using accepted actuarial valuation methods to estimate withdrawals (surrender rate) and income rider utilization. Assumptions are generally based on industry data and pricing assumptions which are updated for actual experience, if necessary. Actual experience may be limited for recently issued products.

All inputs are used to project excess benefits and fees over a range of risk-neutral, stochastic interest rate scenarios. For indexed annuities, stochastic equity return scenarios are also included within the range. A risk margin is incorporated within the discount rate to reflect uncertainty in the projected cash flows such as variations in policyholder behavior, as well as a credit spread to reflect our nonperformance risk, which is considered an unobservable input. Athene uses the credit spread, relative to the U.S. Treasury curve based on its public credit rating as of the valuation date, as the credit spread to reflect its nonperformance risk in the estimate of the fair value of market risk benefits.

The following summarizes the unobservable inputs for market risk benefits:


	December 31, 2023
(In millions, except for percentages)	Fair value		Valuation technique	Unobservable inputs	Minimum		Maximum		Weighted average			Impact of an increase in the input on fair value
Market risk benefits, net	$	3,373	Discounted cash flow	Nonperformance risk	0.4	%	1.4	%	1.2	%	1	Decrease
				Option budget	0.5	%	6.0	%	1.9	%	2	Decrease
				Surrender rate	3.2	%	6.4	%	4.5	%	2	Decrease
				Utilization rate	28.6	%	95.0	%	83.6	%	3	Increase

	December 31, 2022
(In millions, except for percentages)	Fair value		Valuation technique	Unobservable inputs	Minimum		Maximum		Weighted average			Impact of an increase in the input on fair value
Market risk benefits, net	$	2,489	Discounted cash flow	Nonperformance risk	0.2	%	1.6	%	1.4	%	1	Decrease
				Option budget	0.5	%	5.3	%	1.7	%	2	Decrease
				Surrender rate	3.3	%	6.7	%	4.4	%	2	Decrease
				Utilization rate	28.6	%	95.0	%	82.3	%	3	Increase
1 The nonperformance risk weighted average is based on the cash flows underlying the market risk benefit reserve.
2 The option budget and surrender rate weighted averages are calculated based on projected account values.
3 The utilization of GLWB withdrawals represents the estimated percentage of policyholders that are expected to use their income rider over the duration of the contract, with the weighted average based on current account values.