Investments

6 Months Ended

Jun. 30, 2024

Equity Method Investments, Joint Ventures, Investments, Debt And Equity Securities [Abstract]

5. Investments

SECURITIES AVAILABLE-FOR-SALE

The following table presents the amortized cost or cost and fair value of our available-for-sale securities:


(in millions)	Amortized Cost or Costs(a)		Allowance for Credit Losses(b)		Gross Unrealized Gains(c)		Gross Unrealized Losses(c)		Fair Value(a)
June 30, 2024
Bonds available-for-sale:
U.S. government and government sponsored entities	$	1,664	$	—	$	7	$	(300)	$	1,371
Obligations of states, municipalities and political subdivisions	5,809		—		26		(800)		5,035
Non-U.S. governments	4,530		—		26		(800)		3,756
Corporate debt	118,159		(57)		890		(17,747)		101,245
Mortgage-backed, asset-backed and collateralized:
RMBS	16,616		(20)		568		(909)		16,255
CMBS	11,219		(18)		39		(936)		10,304
CLO	11,537		—		161		(72)		11,626
ABS	18,582		—		98		(952)		17,728
Total mortgage-backed, asset-backed and collateralized	57,954		(38)		866		(2,869)		55,913
Total bonds available-for-sale	$	188,116	$	(95)	$	1,815	$	(22,516)	$	167,320

December 31, 2023
Bonds available-for-sale:
U.S. government and government sponsored entities	$	1,436	$	—	$	17	$	(233)	$	1,220
Obligations of states, municipalities and political subdivisions	6,466		—		58		(693)		5,831
Non-U.S. governments	4,695		(2)		43		(679)		4,057
Corporate debt	120,654		(71)		1,294		(15,795)		106,082
Mortgage-backed, asset-backed and collateralized:
RMBS	14,491		(25)		599		(788)		14,277
CMBS	11,045		(30)		22		(1,056)		9,981
CLO	11,203		—		90		(149)		11,144
ABS	14,956		—		63		(1,084)		13,935
Total mortgage-backed, asset-backed and collateralized	51,695		(55)		774		(3,077)		49,337
Total bonds available-for-sale	$	184,946	$	(128)	$	2,186	$	(20,477)	$	166,527

(a)The table above includes available-for-sale securities issued by related parties. This includes RMBS which had a fair value of $5 million and $43 million, and an amortized cost of $4 million and $45 million as of June 30, 2024 and December 31, 2023, respectively.

(b)Changes in the allowance for credit losses are recorded through Net realized gains (losses) and are not recognized in OCI.

(c)At June 30, 2024 includes mark-to-market movement (“MTM”) relating to embedded derivatives.

Securities Available-for-Sale in a Loss Position for Which No Allowance for Credit Loss Has Been Recorded

The following table summarizes the fair value and gross unrealized losses on our available-for-sale securities, aggregated by major investment category and length of time that individual securities have been in a continuous unrealized loss position for which no allowance for credit loss has been recorded:


	Less Than 12 Months				12 Months or More				Total
(in millions)	Fair Value		Gross Unrealized Losses*		Fair Value		Gross Unrealized Losses*		Fair Value		Gross Unrealized Losses*
June 30, 2024
Bonds available-for-sale:
U.S. government and government sponsored entities	$	224	$	12	$	689	$	288	$	913	$	300
Obligations of states, municipalities and political subdivisions	630		82		3,803		718		4,433		800
Non-U.S. governments	636		113		2,700		687		3,336		800
Corporate debt	16,144		2,531		66,557		15,177		82,701		17,708
RMBS	3,498		142		5,471		738		8,969		880
CMBS	1,209		50		6,472		878		7,681		928
CLO	1,442		31		1,479		41		2,921		72
ABS	3,008		95		8,369		857		11,377		952
Total bonds available-for-sale	$	26,791	$	3,056	$	95,540	$	19,384	$	122,331	$	22,440

December 31, 2023
Bonds available-for-sale:
U.S. government and government sponsored entities	$	22	$	3	$	746	$	230	$	768	$	233
Obligations of states, municipalities and political subdivisions	1,124		110		3,676		583		4,800		693
Non-U.S. governments	470		82		2,981		592		3,451		674
Corporate debt	11,338		1,760		75,045		14,009		86,383		15,769
RMBS	2,676		174		4,855		577		7,531		751
CMBS	1,840		159		6,570		886		8,410		1,045
CLO	2,992		60		3,823		89		6,815		149
ABS	2,599		110		8,138		974		10,737		1,084
Total bonds available-for-sale	$	23,061	$	2,458	$	105,834	$	17,940	$	128,895	$	20,398

*At June 30, 2024 includes mark to market movement relating to embedded derivatives.

At June 30, 2024, we held 14,489 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 11,979 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more). At December 31, 2023, we held 15,034 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 12,787 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more). We did not recognize the unrealized losses in earnings on these fixed maturity securities at June 30, 2024 because it was determined that such losses were due to non-credit factors. Additionally, we neither intend to sell the securities nor do we believe that it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. For fixed maturity securities with significant declines, we performed fundamental credit analyses on a security-by-security basis, which included consideration of credit enhancements, liquidity position, expected defaults, industry and sector analysis, forecasts and available market data.

Contractual Maturities of Fixed Maturity Securities Available-for-Sale

The following table presents the amortized cost and fair value of fixed maturity securities available-for-sale by contractual maturity:


	Total Fixed Maturity Securities Available-for-sale
(in millions)	Amortized Cost, Net of Allowance		Fair Value
June 30, 2024
Due in one year or less	$	2,986	$	2,948
Due after one year through five years	22,942		22,280
Due after five years through ten years	23,038		21,172
Due after ten years	81,139		65,007
Mortgage-backed, asset-backed and collateralized	57,916		55,913
Total	$	188,021	$	167,320

Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay certain obligations with or without call or prepayment penalties.

The following table presents the gross realized gains and gross realized losses from sales or maturities of our available-for-sale securities:



	Three Months Ended June 30,								Six Months Ended June 30,
	2024				2023				2024				2023
(in millions)	Gross Realized Gains		Gross Realized Losses		Gross Realized Gains		Gross Realized Losses		Gross Realized Gains		Gross Realized Losses		Gross Realized Gains		Gross Realized Losses
Fixed maturity securities	$	12	$	(554)	$	38	$	(279)	$	15	$	(899)	$	84	$	(418)

For the three and six months ended June 30, 2024, the aggregate fair value of available-for-sale securities sold was $2.5 billion and $5.0 billion, respectively, which resulted in Net realized gains (losses) of $(542) million and $(884) million, respectively. Included within the Net realized gains (losses) are $(49) million and $(71) million of realized gains (losses) for the three and six months ended June 30, 2024, respectively, which relate to the Fortitude Re funds withheld assets held by Corebridge in support of Fortitude Re’s reinsurance obligations to Corebridge (Fortitude Re funds withheld assets). These Net realized gains (losses) are included in Net realized gains (losses) on Fortitude Re funds withheld assets.

For the three and six months ended June 30, 2023, the aggregate fair value of available-for-sale securities sold was $3.0 billion and $5.7 billion, respectively, which resulted in Net realized gains (losses) of $(241) million and $(334) million, respectively. Included within the Net realized gains (losses) are $(46) million and $(63) million of Net realized gains (losses) for the three and six months ended June 30, 2023, respectively, which relate to the Fortitude Re funds withheld assets held by Corebridge in support of Fortitude Re’s reinsurance obligations to Corebridge (Fortitude Re funds withheld assets). These Net realized gains (losses) are included in Net realized gains (losses) on Fortitude Re funds withheld assets.

OTHER SECURITIES MEASURED AT FAIR VALUE

The following table presents the fair value of fixed maturity securities measured at fair value, including securities in the modco agreement with Fortitude Re, based on our election of the fair value option and equity securities measured at fair value:


	June 30, 2024				December 31, 2023
(in millions)	Fair Value		Percent of Total		Fair Value		Percent of Total
Fixed maturity securities:


Obligations of states, municipalities and political subdivisions	$	39	1	%	$	40	1	%
Non-U.S. governments	27		1		13		—
Corporate debt	2,833		55		2,653		57
Mortgage-backed, asset-backed and collateralized:
RMBS	163		3		170		4
CMBS	238		5		228		5
CLO	464		9		423		9
ABS	1,279		25		1,051		23
Total mortgage-backed, asset-backed and collateralized	2,144		42		1,872		41
Total fixed maturity securities	5,043		99		4,578		99
Equity securities	73		1		63		1
Total	$	5,116	100	%	$	4,641	100	%

OTHER INVESTED ASSETS

The following table summarizes the carrying amounts of other invested assets:


(in millions)	June 30, 2024		December 31, 2023
Alternative investments(a)(b)	$	7,532	$	7,690
Investment real estate(c)	1,830		1,932
All other investments(d)	595		635
Total	$	9,957	$	10,257

(a)At June 30, 2024, included hedge funds of $229 million and private equity funds of $7.3 billion. At December 31, 2023, included hedge funds of $299 million and private equity funds of $7.4 billion.

(b)The majority of our hedge fund investments are redeemable upon a single month or quarter’s notice, though redemption terms vary from single, immediate withdrawals, to withdrawals staggered up to eight quarters. Some of the portfolio consists of illiquid run-off or “side-pocket” positions whose liquidation horizons are uncertain and likely beyond a year after submission of the redemption notice.

(c)Net of accumulated depreciation of $652 million and $680 million as of June 30, 2024 and December 31, 2023, respectively.

(d)Includes Corebridge’s ownership interest in Fortitude Re Bermuda, which is recorded using the measurement alternative for equity securities. Our investment in Fortitude Re Bermuda totaled $156 million and $156 million at June 30, 2024 and December 31, 2023, respectively.

Other Invested Assets – Equity Method Investments

The carrying amount of equity method investments totaled $2.7 billion and $2.9 billion as of June 30, 2024 and December 31, 2023, respectively, representing various ownership percentages each period.

NET INVESTMENT INCOME

The following table presents the components of Net investment income:


	2024						2023
(in millions)	Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets		Total		Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets		Total
Three Months Ended June 30,
Available-for-sale fixed maturity securities, including short-term investments	$	2,174	$	183	$	2,357	$	1,905	$	208	$	2,113
Other fixed maturity securities	13		78		91		8		6		14
Equity securities	(7)		—		(7)		3		—		3
Interest on mortgage and other loans	592		48		640		564		49		613
Alternative investments*	52		26		78		80		13		93
Real estate	10		(1)		9		15		—		15
Other investments	15		—		15		8		—		8
Total investment income	2,849		334		3,183		2,583		276		2,859
Investment expenses	186		9		195		139		6		145
Net investment income	$	2,663	$	325	$	2,988	$	2,444	$	270	$	2,714

Six Months Ended June 30,

Available-for-sale fixed maturity securities, including short-term investments	$	4,358	$	378	$	4,736	$	3,801	$	425	$	4,226
Other fixed maturity securities	26		149		175		18		111		129
Equity securities	3		—		3		32		—		32
Interest on mortgage and other loans	1,172		96		1,268		1,076		99		1,175
Alternative investments*	—		59		59		79		44		123
Real estate	22		(8)		14		19		—		19
Other investments	27		—		27		11		—		11
Total investment income	5,608		674		6,282		5,036		679		5,715
Investment expenses	353		17		370		291		15		306
Net investment income	$	5,255	$	657	$	5,912	$	4,745	$	664	$	5,409

*Included income from hedge funds and private equity funds. Hedge funds are recorded as of the balance sheet date. Private equity funds are generally reported on a one-quarter lag.

NET REALIZED GAINS AND LOSSES

The following table presents the components of Net realized gains (losses):


	2024						2023
(in millions)	Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets		Total		Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets		Total
Three Months Ended June 30,
Sales of fixed maturity securities	$	(493)	$	(49)	$	(542)	$	(195)	$	(46)	$	(241)
Intent to sell	—		—		—		—		—		—
Change in allowance for credit losses on fixed maturity securities	(50)		(1)		(51)		(26)		(2)		(28)
Change in allowance for credit losses on loans	(34)		(5)		(39)		(48)		(8)		(56)
Foreign exchange transactions, net of related hedges	55		(1)		54		(115)		2		(113)
Index-Linked interest credited embedded derivatives, net of related hedges	(172)		—		(172)		(141)		—		(141)
All other derivatives and hedge accounting*	18		(34)		(16)		258		(77)		181
Sales of alternative investments and real estate investments	11		(3)		8		3		(1)		2
Other	(25)		—		(25)		(48)		2		(46)
Net realized gains (losses) – excluding Fortitude Re funds withheld embedded derivative	(690)		(93)		(783)		(312)		(130)		(442)
Net realized gains (losses) on Fortitude Re funds withheld embedded derivative	—		36		36		—		122		122
Net realized gains (losses)	$	(690)	$	(57)	$	(747)	$	(312)	$	(8)	$	(320)

Six Months Ended June 30,

Sales of fixed maturity securities	$	(813)	$	(71)	$	(884)	$	(271)	$	(63)	$	(334)
Intent to sell	(15)		(32)		(47)		—		—		—
Change in allowance for credit losses on fixed maturity securities	(112)		(7)		(119)		(43)		(2)		(45)
Change in allowance for credit losses on loans	(48)		(3)		(51)		(82)		(27)		(109)
Foreign exchange transactions, net of related hedges	101		—		101		(104)		9		(95)
Index-Linked interest credited embedded derivatives, net of related hedges	(82)		—		(82)		(319)		—		(319)
All other derivatives and hedge accounting*	123		(140)		(17)		94		(29)		65
Sales of alternative investments and real estate investments	31		(4)		27		8		—		8
Other	(53)		—		(53)		(48)		2		(46)
Net realized gains (losses) – excluding Fortitude Re funds withheld embedded derivative	(868)		(257)		(1,125)		(765)		(110)		(875)
Net realized gains (losses) on Fortitude Re funds withheld embedded derivative	—		58		58		—		(903)		(903)
Net realized gains (losses)	$	(868)	$	(199)	$	(1,067)	$	(765)	$	(1,013)	$	(1,778)

*Derivative activity related to hedging MRBs is recorded in Change in the fair value of MRBs, net. For additional disclosures about MRBs, see Note 14.

CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS

The following table presents the increase (decrease) in unrealized appreciation (depreciation) of our available-for-sale securities:


	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)	2024		2023		2024		2023
Increase (decrease) in unrealized appreciation (depreciation) of investments:
Fixed maturity securities	$	(1,222)	$	(1,783)	$	(2,309)	$	2,236
Other investments	3		11		3		12
Total increase (decrease) in unrealized appreciation (depreciation) of investments*	$	(1,219)	$	(1,772)	$	(2,306)	$	2,248

* Excludes net unrealized gains and losses attributable to business Held-for-sale at December 31 2023.

The following table summarizes the unrealized gains and losses recognized in Net investment income during the reporting period on equity securities and other invested assets still held at the reporting date:


	2024						2023
(in millions)	Equities		Other Invested Assets		Total		Equities		Other Invested Assets		Total
Three Months Ended June 30,
Net gains (losses) recognized during the period on equity securities and other investments	$	(7)	$	83	$	76	$	4	$	123	$	127
Less: Net gains (losses) recognized during the period on equity securities and other investments sold during the period	(2)		2		—		—		8		8
Unrealized gains (losses) recognized during the reporting period on equity securities and other investments still held at the reporting date	$	(5)	$	81	$	76	$	4	$	115	$	119

Six Months Ended June 30,
Net gains (losses) recognized during the period on equity securities and other investments	$	3	$	153	$	156	$	33	$	154	$	187
Less: Net gains (losses) recognized during the period on equity securities and other investments sold during the period	16		4		20		33		9		42
Unrealized gains (losses) recognized during the reporting period on equity securities and other investments still held at the reporting date	$	(13)	$	149	$	136	$	—	$	145	$	145

EVALUATING INVESTMENTS FOR AN ALLOWANCE FOR CREDIT LOSSES AND IMPAIRMENTS

Credit Impairments

The following table presents a rollforward of the changes in allowance for credit losses on available-for-sale fixed maturity securities by major investment category:


	2024						2023
(in millions)	Structured		Non-Structured		Total		Structured		Non-Structured		Total
Three Months Ended June 30,
Balance, beginning of period	$	36	$	61	$	97	$	27	$	69	$	96
Additions:
Securities for which allowance for credit losses were not previously recorded	1		14		15		13		16		29


Reductions:
Securities sold during the period	—		(2)		(2)		1		(10)		(9)
Additional net increases or decreases to the allowance for credit losses on securities that had an allowance recorded in a previous period, for which there was no intent to sell before recovery, amortized cost basis	24		12		36		(1)		—		(1)
Write-offs charged against the allowance	(24)		(28)		(52)		—		(25)		(25)
Other	1		—		1		—		—		—
Balance, end of period	$	38	$	57	$	95	$	40	$	50	$	90

Six Months Ended June 30,
Balance, beginning of year	$	55	$	73	$	128	$	27	$	121	$	148
Additions:
Securities for which allowance for credit losses were not previously recorded	14		31		45		15		28		43


Reductions:
Securities sold during the period	(15)		(11)		(26)		(1)		(27)		(28)
Additional net increases or decreases to the allowance for credit losses on securities that had an allowance recorded in a previous period, for which there was no intent to sell before recovery, amortized cost basis	46		28		74		(1)		3		2
Write-offs charged against the allowance	(63)		(65)		(128)		—		(75)		(75)
Other	1		1		2		—		—		—
Balance, end of period	$	38	$	57	$	95	$	40	$	50	$	90

Purchased Credit Deteriorated Securities

We purchase certain RMBS securities that have experienced more-than-insignificant deterioration in credit quality since origination. These are referred to as purchased credit deteriorated assets. At the time of purchase an allowance is recognized for these purchased credit deteriorated assets by adding it to the purchase price to arrive at the initial amortized cost. There is no credit loss expense recognized upon acquisition of a purchased credit deteriorated asset. When determining the initial allowance for credit losses, management considers the historical performance of underlying assets and available market information as well as bond-specific structural considerations, such as credit enhancement and the priority of payment structure of the security. In addition, the process of estimating future cash flows includes, but is not limited to, the following critical inputs:

•current delinquency rates;

•expected default rates and the timing of such defaults;

•loss severity and the timing of any recovery; and

•expected prepayment speeds.

Subsequent to the acquisition date, the purchased credit deteriorated assets follow the same accounting as other structured securities that are not of high credit quality.

We did not purchase securities with more-than-insignificant credit deterioration since their origination during the six months ended June 30, 2024 and 2023.

PLEDGED INVESTMENTS

Secured Financing and Similar Arrangements

We enter into secured financing transactions whereby certain securities are sold under agreements to repurchase (repurchase agreements), in which we transfer securities in exchange for cash, with an agreement by us to repurchase the same or substantially similar securities. Our secured financing transactions also include those that involve the transfer of securities to financial institutions in exchange for cash (securities lending agreements). In all of these secured financing transactions, the securities transferred by us (pledged collateral) may be sold or repledged by the counterparties. These agreements are recorded at their contracted amounts plus accrued interest, other than those that are accounted for at fair value.

Pledged collateral levels are monitored daily and are generally maintained at an agreed-upon percentage of the fair value of the amounts borrowed during the life of the transactions. In the event of a decline in the fair value of the pledged collateral under these secured financing transactions, we may be required to transfer cash or additional securities as pledged collateral under these agreements. At the termination of the transactions, we and our counterparties are obligated to return the amounts borrowed and the securities transferred, respectively.

The following table presents the fair value of securities pledged to counterparties under secured financing transactions, including repurchase agreements:


(in millions)	June 30, 2024		December 31, 2023
Fixed maturity securities available-for-sale	$	1,590	$	2,655

At June 30, 2024 and December 31, 2023, amounts borrowed under repurchase agreements totaled $1.6 billion and $2.5 billion, respectively.

The following table presents the fair value of securities pledged under our repurchase agreements by collateral type and by remaining contractual maturity:


	Remaining Contractual Maturity of the Repurchase Agreements
(in millions)	Overnight and Continuous		Up to 30 Days		31 - 90 Days		91 - 364 Days		365 Days or Greater		Total
June 30, 2024
Bonds available-for-sale:


Non-U.S. governments	$	—	$	50	$	—	$	—	$	—	$	50
Corporate debt	24		1,516		—		—		—		1,540
Total	$	24	$	1,566	$	—	$	—	$	—	$	1,590




December 31, 2023
Bonds available-for-sale:


Non-U.S. governments	$	—	$	209	$	—	$	—	$	—	$	209
Corporate debt	38		2,408		—		—		—		2,446
Total	$	38	$	2,617	$	—	$	—	$	—	$	2,655

There were no securities lending agreements at June 30, 2024 and December 31, 2023.

There were no reverse repurchase agreements at June 30, 2024 and December 31, 2023.

We do not currently offset any secured financing transactions. All such transactions are collateralized and margined daily consistent with market standards and subject to enforceable master netting arrangements with rights of set off.

Insurance – Statutory and Other Deposits

The total carrying value of cash and securities deposited by our insurance subsidiaries under requirements of regulatory authorities or other insurance-related arrangements, including certain annuity-related obligations and certain reinsurance treaties, was $9.8 billion and $8.1 billion at June 30, 2024 and December 31, 2023, respectively.

Other Pledges and Restrictions

Certain of our subsidiaries are members of Federal Home Loan Banks (“FHLB”) and such membership requires the members to own stock in these FHLBs. We owned an aggregate of $273 million and $268 million of stock in FHLBs at June 30, 2024 and December 31, 2023, respectively. In addition, our subsidiaries have pledged securities available-for-sale and residential loans associated with borrowings and funding agreements from FHLBs, with a fair value of $4.3 billion and $3.0 billion, respectively, at June 30, 2024 and $4.8 billion and $3.0 billion, respectively, at December 31, 2023.

Certain GICs recorded in policyholder contract deposits with a carrying value of $49 million and $53 million at June 30, 2024 and December 31, 2023, respectively, have provisions that require collateral to be posted or payments to be made by us upon a downgrade of our Insurer Financial Strength (“IFS”) ratings. The actual amount of collateral required to be posted to the counterparties in the event of such downgrades and the aggregate amount of payments that we could be required to make depend on market conditions, the fair value of outstanding affected transactions and other factors prevailing at and after the time of the downgrade. The fair value of securities pledged as collateral with respect to these obligations was approximately $46 million and $63 million at June 30, 2024 and December 31, 2023, respectively. This collateral primarily consists of securities of the U.S. government and government-sponsored entities and generally cannot be repledged or resold by the counterparties.

As part of our collateralized reinsurance transactions, we pledge collateral to cedants as contractually required. The fair value of securities pledged as excess collateral with respect to these obligations was approximately $577 million and $490 million at June 30, 2024 and December 31, 2023, respectively. Additionally, assets supporting these transactions are held solely for the benefit of the cedants and insulated from obligations owed to our other policyholders and general creditors.

Reinsurance transactions between Corebridge and Fortitude Re were structured as modco with funds withheld.