VOYA 10-Q Quarter ended Sept. 30, 2021

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Business

Voya Financial, Inc. and its subsidiaries (collectively the "Company") is a financial services organization in the United States that offers a broad range of retirement services, investment management services, mutual funds, group insurance and supplemental health products.

On January 4, 2021, the Company completed a series of transactions pursuant to a Master Transaction Agreement (the “Resolution MTA”) entered into on December 18, 2019 with Resolution Life U.S. Holdings Inc., a Delaware corporation (“Resolution Life US”), pursuant to which Resolution Life US acquired all of the shares of the capital stock of Security Life of Denver Company ("SLD") and Security Life of Denver International Limited ("SLDI"), including the capital stock of several subsidiaries of SLD and SLDI. The Company will continue to hold an insignificant number of Individual Life, and non-Wealth Solutions annuity policies which together with the businesses sold through divestment or reinsurance will be referred to as "divested businesses".

Concurrently with the sale, SLD entered into reinsurance agreements with insurance subsidiaries of the Company. Pursuant to these agreements, the Company's subsidiaries reinsured to SLD certain individual life insurance and annuity businesses. The sale of SLD, SLDI and several of their subsidiaries along with the aforementioned reinsurance transactions are referred to herein as the "Individual Life Transaction". The Individual Life Transaction resulted in the disposition of substantially all of the Company's life insurance and legacy non-Wealth Solutions annuity businesses and related assets.

On March 15, 2021, the Company announced several updates to our operating model and leadership team. In conjunction with those updates, the Retirement and Employee Benefits segments were renamed to Wealth Solutions and Health Solutions, respectively. The Company will continue to provide its principal products and services through three segments: Wealth Solutions, Investment Management and Health Solutions. In addition, the Company includes in Corporate activities that are not directly related to its segments and certain run-off activities that are not meaningful to the Company's business strategy. See the Segments Note to these Condensed Consolidated Financial Statements.

On June 9, 2021, the Company completed the sale of the independent financial planning channel of Voya Financial Advisors (“VFA”) to Cetera Financial Group, Inc. (“Cetera”), one of the nation's largest networks of independently managed broker-dealers. In connection with this transaction, the Company transferred more than 800 independent financial professionals serving retail customers with approximately $ 38 billion in assets under advisement to Cetera, while retaining approximately 600 field and phone-based financial professionals who support our Wealth Solutions business. In addition, the sale resulted in a gain, net of transaction costs of $ 275 , before income taxes, which was recorded in Other revenue in the accompanying Condensed Consolidated Statements of Operations for the nine months ended September 30, 2021. The net gain decreased $ 4 in the third quarter as a result of the completion of negotiations related to the sales price true-up process consistent with the deal terms.

Basis of Presentation

The accompanying Condensed Consolidated Financial Statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and are unaudited. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The inputs into the Company's estimates and assumptions consider the economic implications of COVID-19 on the Company's critical and significant accounting estimates. Those estimates are inherently subject to change and actual results could differ from those estimates, and the differences may be material to the Condensed Consolidated Financial Statements.

The Condensed Consolidated Financial Statements include the accounts of Voya Financial, Inc. and its subsidiaries, as well as other voting interest entities ("VOEs") and variable interest entities ("VIEs") in which the Company has a controlling financial interest. See the Consolidated and Nonconsolidated Investment Entities Note to these Condensed Consolidated Financial Statements. Intercompany transactions and balances have been eliminated.

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The accompanying Condensed Consolidated Financial Statements reflect adjustments (including normal, recurring adjustments) necessary to present fairly the financial position of the Company as of September 30, 2021, its results of operations, comprehensive income and changes in shareholders' equity for the three and nine months ended September 30, 2021 and 2020, and its statements of cash flows for the nine months ended September 30, 2021 and 2020, in conformity with U.S. GAAP. Interim results are not necessarily indicative of full year performance.

Certain reclassifications have been made to prior-period amounts to conform to current-period reporting classifications.  These reclassifications had no impact on net income or total stockholders’ equity.

The December 31, 2020 Consolidated Balance Sheet is from the audited Consolidated Financial Statements included in the Company's Annual Report on Form 10-K , filed with the SEC. Therefore, these unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and related notes included in the Company's Annual Report on Form 10-K .

Significant Accounting Policies

Investments

Fixed Maturities and Equity Securities : In the second quarter of 2021, the Company established a trading portfolio of fixed maturity debt securities. Trading securities are valued at fair value with the changes in fair value recorded in Other net realized capital gains (losses) in the Condensed Consolidated Statements of Operations, and interest income is recorded in Net investment income in the Condensed Consolidated Statements of Operations.

Adoption of New Pronouncements

The following table provides a description of the Company's adoption of new Accounting Standard Updates ("ASUs") issued by the Financial Accounting Standards Board ("FASB") and the impact of the adoption on the Company's financial statements.

Standard			Description of Requirements			Effective Date and Method of Adoption			Effect on the Financial Statements or Other Significant Matters
ASU 2019-12, Simplifying the Accounting for Income Taxes			This standard, issued in December 2019, simplifies the accounting for income taxes by eliminating certain exceptions to the general principles and simplifying several aspects of ASC 740, Income taxes, including requirements related to the following: • The intraperiod tax allocation exception to the incremental approach, • The tax basis step-up in goodwill obtained in a transaction that is not a business combination, • Hybrid tax regimes, • Ownership changes in investments - changes from a subsidiary to an equity method investment, • Separate financial statements of entities not subject to tax, • Interim-period accounting for enacted changes in tax law, and • The year-to-date loss limitation in interim-period tax accounting.			January 1, 2021 on a prospective basis, except for those provisions that required retrospective or modified retrospective method.			Adoption of the ASU did not have an impact on the Company's financial condition, results of operations, or cash flows.

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Future Adoption of Accounting Pronouncements

The following table provides a description of future adoptions of new accounting standards that may have an impact on the Company's financial statements when adopted:

Standard			Description of Requirements			Effective Date and Transition Provisions			Effect on the Financial Statements or Other Significant Matters
ASU 2020-04, Reference Rate Reform			This standard, issued in March 2020, provides temporary optional expedients and exceptions for applying U.S. GAAP principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In January, 2021, the FASB issued ASU 2021-01, which clarified the scope of relief related to ASU 2020-04.			The amendments are effective as of March 12, 2020, the issuance date of the ASU. An entity may elect to apply the amendments prospectively through December 31, 2022.			The Company expects that it will elect to apply some of the expedients and exceptions provided in ASU 2020-04; however, the Company is still evaluating its options under this guidance as the reference rate reform adoption process continues. Therefore, the impact of the adoption of ASU 2020-04 on the Company’s financial condition and results of operations has not yet been determined.
ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts			This standard, issued in August 2018, changes the measurement and disclosures of insurance liabilities and deferred acquisition costs ("DAC") for long-duration contracts issued by insurers.			In November, 2020, the FASB released ASU 2020-11, which deferred the effective date of the amendments in ASU 2018-12 for SEC filers to fiscal years ending after December 15, 2022, including interim periods within those fiscal years. Initial adoption for the liability for future policy benefits and DAC is required to be reported using either a full retrospective or modified retrospective approach. For market risk benefits, full retrospective application is required.			The implications of these requirements, including transition options, and related potential financial statement impacts are currently being evaluated. While it is not possible to estimate the expected impact of adoption at this time, the Company believes there is a reasonable possibility that implementation of ASU 2018-12 may result in a significant impact on Shareholders’ equity and future earnings patterns.

As noted in the Business, Basis of Presentation and Significant Accounting Policies Note, on January 4, 2021, the Company sold several of its subsidiaries and the related Individual Life and fixed and variable annuities businesses within these subsidiaries to Resolution Life US pursuant to the Resolution MTA entered into on December 18, 2019.

The Individual Life Transaction

Sale of legal entities

Pursuant to the Company executing the Resolution MTA and the Individual Life Transaction, the Company sold five of its legal subsidiaries, SLD, SLDI, Roaring River II ("RRII"), Midwestern United Life Insurance Company ("MUL") and Voya American Equities, Inc. ("VAE") to Resolution Life US. Resolution Life US is an insurance holding company newly formed by Resolution Life Group Holdings, L.P., a Bermuda-based limited partnership (“RLGH”).

The purchase price received by the Company at the closing was based on estimated amounts and was subject to a post-close true-up mechanism pursuant to which the purchase price was adjusted based on SLD's adjusted book value as of the closing date. In addition to cash consideration, proceeds included an approximately $ 225 interest in RLGH and certain other affiliates of Resolution Life US, and $ 123 principal amount in surplus notes issued by SLD. In connection with the closing, the Company agreed to defer receipt of $ 100 in cash proceeds for a period of up to 42 months, subject to an adjustment mechanism based on

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certain financial contingencies affecting SLD over that period. In addition, in connection with the unwind of certain guarantee obligations affecting portions of SLD's business, in lieu of $ 60 of cash proceeds, the Company received approximately $ 60 in additional preferred equity interests in Resolution Life US affiliates. During the third quarter of 2021, the Company and Resolution Life US completed the post-close true-up process which resulted in an immaterial increase to loss on sale of $ 1 that was recorded in the Condensed Consolidated Statements of Operations for the third quarter of 2021. Additionally, the Company received the $ 100 of cash proceeds from Resolution Life US in the third quarter of 2021 which was deferred at the time of closing as mentioned above.

The Company determined that the entities disposed of met the criteria to be classified as held for sale and that the sale represents a strategic shift that will have a major effect on the Company’s operations. Accordingly, the results of operations of the entities sold have been presented as discontinued operations in the accompanying Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows, and the assets and liabilities of the businesses have been classified for 2020 as held for sale and segregated for all periods presented in the Condensed Consolidated Balance Sheets. A business classified as held for sale is recorded at the lower of its carrying value or estimated fair value less cost to sell. If the carrying value exceeds its estimated fair value less cost to sell, a loss is recognized.

The results of discontinued operations are reported in "Income (loss) from discontinued operations, net of tax" in the accompanying Condensed Consolidated Statements of Operations for all periods presented. As of December 31, 2020, the Company recorded an estimated loss on sale, net of tax of $ 1,466 to write down the carrying value of the businesses sold to estimated fair value, which was based on the estimated sales price of the Individual Life Transaction as of December 31, 2020, less cost to sell and other adjustments in accordance with the Resolution MTA. In addition, Income (loss) from discontinued operations, net of tax, for the nine months ended September 30, 2021 includes a reduction to loss on sale, net of tax of $ 7 . The final loss on sale, net of tax as of September 30, 2021 of $ 1,459 represents the excess of the carrying value of the businesses sold over the purchase price, which approximates fair value, less cost to sell.

Furthermore, in connection with the close of the Individual Life Transaction, the Company reversed $ 913 of Additional other comprehensive income, net of tax that was previously recorded and related to the entities sold. As a result of the transaction, the Company incurred loss recognition of $ 523 , which is inclusive of $ 302 of DAC/VOBA write down and $ 221 of premium deficiency reserve. The DAC/VOBA write down and the premium deficiency reserve were recorded in Net amortization of DAC/VOBA and Policyholder benefits, respectively in the Condensed Consolidated Financial Statements for the nine months ended September 30, 2021.

During the third quarter of 2021, and as a result of the annual review of assumptions of the divested businesses through reinsurance disclosed below, the Company recorded loss recognition of $136 for DAC/VOBA and established premium deficiency reserves of $225, both of which were related to divested businesses and excluded from Adjusted operating earnings for the current period. Loss recognition related to DAC/VOBA and premium deficiency reserves were recorded in Net amortization of DAC/VOBA and Interest credited to contract owner account balances, respectively in the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2021.

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The following table summarizes the major categories of assets and liabilities classified as held for sale related to the Individual Life Transaction in the accompanying Condensed Consolidated Balance Sheets as of December 31, 2020:

									December 31, 2020
Assets:
Investments:
Fixed maturities, at fair value									$	13,317
Fixed maturities, at fair value using the fair value option									682
Mortgage loans on real estate, net of valuation allowance									1,242
Policy loans									999
Derivatives									443
Other investments (1)									368
Securities pledged									4
Total investments									17,055
Cash and cash equivalents									420
Short-term investments under securities loan agreements, including collateral delivered									2
Premium receivable and reinsurance recoverable, net									2,783
Deferred policy acquisition costs and Value of business acquired									289
Current income taxes									—
Deferred income taxes									( 831 )
Other assets (2)									826
Assets held in separate accounts									1,625
Write-down of businesses held for sale to fair value less cost to sell									( 1,466 )
Total assets held for sale									$	20,703
Liabilities:
Future policy benefits and contract owner account balances									$	15,675
Payables under securities loan and repurchase agreements, including collateral held									300
Derivatives									117
Notes payable									219
Other liabilities									679
Liabilities related to separate accounts									1,625
Total liabilities held for sale									$	18,615

(1) Includes Other investments, Equity securities, Limited partnerships/corporations and Short-term investments.

(2) Includes Other assets and Accrued investment income.

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The following table summarizes the components of Income (loss) from discontinued operations, net of tax related to the Individual Life Transaction (closed on January 4, 2021) for the nine months ended September 30, 2021 and 2020:

			Nine Months Ended September 30,
			2021						2020
Revenues:
Net investment income			$	—					$	485
Fee income			—						596
Premiums			—						21
Total net realized capital gains (losses)			—						20
Other revenue			—						( 13 )
Total revenues			—						1,109
Benefits and expenses:
Interest credited and other benefits to contract owners/policyholders			—						947
Operating expenses			—						107
Net amortization of Deferred policy acquisition costs and Value of business acquired			—						215
Interest expense			—						5
Total benefits and expenses			—						1,274
Income (loss) from discontinued operations before income taxes			—						( 165 )
Income tax expense (benefit)			—						( 35 )
Adjustment to loss on sale, net of tax			7						( 233 )
Income (loss) from discontinued operations, net of tax			$	7					$	( 363 )

Reinsurance

Concurrently with the sale of the Company's Individual Life business, the Company's wholly owned subsidiaries Reliastar Life Insurance Company ("RLI"), ReliaStar Life Insurance Company of New York ("RLNY"), and Voya Retirement Insurance and Annuity Company ("VRIAC"), each of which is a direct or indirect wholly owned subsidiary of the Company entered into three reinsurance agreements with SLD. Pursuant to these agreements, RLI and VRIAC ceded to SLD a 100 % quota share, and RLNY ceded to SLD a 75 % quota share, of their respective individual life insurance and annuities businesses. The reinsurance obligation with counterparty SLD are secured by collateralized assets held in a trust. Additionally, RLI entered into a reinsurance agreement, on a coinsurance basis with funds withheld, with a subsidiary of Resolution Life. RLI, RLNY, and VRIAC continue to be subsidiaries of the Company. The reinsurance transaction does not extinguish the Company’s primary liability to its policyholders. As a result of the reinsurance transactions on January 4, 2021, the Company reinsured $ 11.4 billion of policyholder liabilities under indemnity coinsurance and modified coinsurance arrangements. As of January 4, 2021, reinsurance recoverable associated with these transactions was $ 10.4 billion. The Company ceded $ 5.6 billion in premiums and $ 5.5 billion in policyholder benefits. The Company transferred invested assets with a fair market value of $ 10.8 billion and cash of $ 427 as consideration for the reinsurance arrangements. As a result of the transfer of invested assets the Company recognized $ 1.9 billion in pre-tax realized gains. The Company also recognized non-cash assets of $ 345 and $ 1.7 billion relating to the pre-tax net cost of reinsurance asset and deposit asset on January 4, 2021, as a result of entering into the reinsurance agreements.

Furthermore, at the close of the Individual Life Transaction on January 4, 2021, we have $ 1.3 billion of pre-tax deferred intangibles associated with the divested businesses. The deferred intangibles consist of (1) existing DAC, VOBA and URR balances on businesses already exited via reinsurance and for the portion of the transaction that involves a sale through reinsurance, (2) existing deferred Cost of reinsurance (“COR”) on businesses already exited via reinsurance and (3) deferred COR established as a result of the Individual Life Transaction. The deferred intangibles are amortized as a charge to earnings over the life of the underlying policies. Additionally, for the portion of the reinsurance transactions that involve policies that do not meet risk transfer, a deposit asset was established in the amount of $ 1.7 billion on a pre-tax basis. This relates to liabilities related to Contract owner account balances that currently exist for the related underlying policies. The quarterly pre-tax impact

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on income of the deferred intangibles was $ 159 which comprises of amortization of $ 23 and loss recognition of $ 136 , both of which were recorded in the accompanying Condensed Consolidated Statements of Operations. In addition, the amortization of the deposit asset is largely offset by the interest credited to policyholders. The amortization of the deferred intangibles and the deposit asset has been classified as a component of Income (loss) related to businesses exited or to be exited via reinsurance which is an adjustment to Income (loss) from continuing operations before income taxes to calculate Adjusted operating earnings before taxes and consequently are not included in the adjusted operating results of our segments. Additionally, we would expect the annual impact of the amortization of the deferred intangibles and deposit asset to decline over time.

The reinsurance agreements along with the sale of the legal entities noted above resulted in the disposition of substantially all of the Company's life insurance and legacy non-wealth solutions annuity businesses. The revenues and net results of the Individual Life and Annuities businesses that were disposed of via reinsurance are reported in businesses exited or to be exited through reinsurance or divestment which is an adjustment to the Company's U.S. GAAP revenues and earnings measures to calculate Adjusted operating revenues and Adjusted operating earnings before income taxes, respectively.

Information regarding the effect of all reinsurance on the Consolidated Balance Sheets is as follows as of the period indicated:

			September 30, 2021
			Direct						Assumed						Ceded						Total, Net of Reinsurance
Assets
Premiums receivable			$	160					$	10					$	( 208 )					$	( 38 )
Reinsurance recoverable, net of allowance for credit losses			—						—						13,618						13,618
Total			$	160					$	10					$	13,410					$	13,580
Liabilities
Future policy benefits and contract owner account balances			$	52,018					$	925					$	( 13,618 )					$	39,325
Liability for funds withheld under reinsurance agreements			239						—						—						239
Total			$	52,257					$	925					$	( 13,618 )					$	39,564

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Information regarding the effect of reinsurance on the Consolidated Statement of Operations is as follows for the period indicated:

			Nine Months Ended September 30,
			2021
Premiums:
Direct premiums			$	2,288
Reinsurance assumed			22
Reinsurance ceded			( 6,208 )
Net premiums			$	( 3,898 )
Fee income:
Gross fee income			$	1,684
Reinsurance Assumed			13
Reinsurance ceded			( 316 )
Net fee income			$	1,381
Interest credited and other benefits to contract owners / policyholders:
Direct interest credited and other benefits to contract owners / policyholders			$	4,231
Reinsurance assumed			57
Reinsurance ceded (1)			( 7,078 )
Net interest credited and other benefits to contract owners / policyholders			$	( 2,790 )

(1) Includes $ 5,944 amounts paid to reinsurers in connection with the Company's UL contracts for the nine months ended September 30, 2021.

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Fixed Maturities

Available-for-sale and fair value option ("FVO") fixed maturities were as follows as of September 30, 2021:

			Amortized Cost						Gross Unrealized Capital Gains						Gross Unrealized Capital Losses						Embedded Derivatives (2)						Fair Value						Allowance for credit losses
Fixed maturities:
U.S. Treasuries			$	775					$	237					$	—					$	—					$	1,012					$	—
U.S. Government agencies and authorities			69						12						—						—						81						—
State, municipalities and political subdivisions			962						114						1						—						1,075						—
U.S. corporate public securities			10,767						1,675						43						—						12,399						—
U.S. corporate private securities			4,802						510						22						—						5,290						—
Foreign corporate public securities and foreign governments (1)			3,395						407						17						—						3,785						—
Foreign corporate private securities (1)			3,383						294						3						—						3,643						31
Residential mortgage-backed securities			4,488						165						24						14						4,642						1
Commercial mortgage-backed securities			3,901						208						17						—						4,092						—
Other asset-backed securities			2,123						33						6						—						2,149						1
Total fixed maturities, including securities pledged			34,665						3,655						133						14						38,168						33
Less: Securities pledged			1,171						150						1						—						1,320						—
Total fixed maturities			$	33,494					$	3,505					$	132					$	14					$	36,848					$	33

(1) Primarily U.S. dollar denominated.

(2) Embedded derivatives within fixed maturity securities are reported with the host investment. The changes in fair value of embedded derivatives are reported in Other net realized capital gains (losses) in the Condensed Consolidated Statements of Operations.

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Available-for-sale and FVO fixed maturities were as follows as of December 31, 2020:

			Amortized Cost						Gross Unrealized Capital Gains						Gross Unrealized Capital Losses						Embedded Derivatives (2)						Fair Value						Allowance for credit losses
Fixed maturities:
U.S. Treasuries			$	1,033					$	438					$	—					$	—					$	1,471					$	—
U.S. Government agencies and authorities			74						28						—						—						102						—
State, municipalities and political subdivisions			1,166						180						—						—						1,346						—
U.S. corporate public securities			13,366						3,028						7						—						16,387						—
U.S. corporate private securities			5,653						828						35						—						6,446						—
Foreign corporate public securities and foreign governments (1)			4,023						714						1						—						4,736						—
Foreign corporate private securities (1)			4,220						470						29						—						4,646						15
Residential mortgage-backed securities			5,370						255						17						20						5,626						2
Commercial mortgage-backed securities			3,882						290						40						—						4,131						1
Other asset-backed securities			2,110						46						10						—						2,138						8
Total fixed maturities, including securities pledged			40,897						6,277						139						20						47,029						26
Less: Securities pledged			355						95						1						—						449						—
Total fixed maturities			$	40,542					$	6,182					$	138					$	20					$	46,580					$	26

(1) Primarily U.S. dollar denominated.

(2) Embedded derivatives within fixed maturity securities are reported with the host investment. The changes in fair value of embedded derivatives are reported in Other net realized capital gains (losses) in the Condensed Consolidated Statements of Operations.

The amortized cost and fair value of fixed maturities, including securities pledged, as of September 30, 2021, are shown below by contractual maturity. Actual maturities may differ from contractual maturities as securities may be restructured, called or prepaid. Mortgage-backed securities ("MBS") and Other asset-backed securities ("ABS") are shown separately because they are not due at a single maturity date.

			Amortized Cost						Fair Value
Due to mature:
One year or less			$	603					$	612
After one year through five years			4,497						4,800
After five years through ten years			5,725						6,338
After ten years			13,328						15,535
Mortgage-backed securities			8,389						8,734
Other asset-backed securities			2,123						2,149
Fixed maturities, including securities pledged			$	34,665					$	38,168

As of September 30, 2021 and December 31, 2020, the Company did no t have any investments in a single issuer, other than obligations of the U.S. Government and government agencies, with a carrying value in excess of 10% of the Company’s Total shareholders' equity.

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The following tables present the composition of the U.S. and foreign corporate securities within the fixed maturity portfolio by industry category as of the dates indicated:

			Amortized Cost						Gross Unrealized Capital Gains						Gross Unrealized Capital Losses						Fair Value
September 30, 2021
Communications			$	1,261					$	245					$	3					$	1,503
Financial			3,731						432						13						4,150
Industrial and other companies			9,953						1,159						36						11,076
Energy			1,877						343						18						2,202
Utilities			3,826						550						9						4,367
Transportation			1,170						107						2						1,275
Total			$	21,818					$	2,836					$	81					$	24,573
December 31, 2020
Communications			$	1,629					$	425					$	1					$	2,053
Financial			4,419						811						3						5,227
Industrial and other companies			11,670						2,088						15						13,743
Energy			2,594						474						28						3,040
Utilities			4,963						944						1						5,906
Transportation			1,331						196						23						1,504
Total			$	26,606					$	4,938					$	71					$	31,473

The Company invests in various categories of collateralized mortgage obligations (CMOs), including CMOs that are not agency-backed, that are subject to different degrees of risk from changes in interest rates and defaults. The principal risks inherent in holding CMOs are prepayment and extension risks related to significant decreases and increases in interest rates resulting in the prepayment of principal from the underlying mortgages, either earlier or later than originally anticipated. As of September 30, 2021 and December 31, 2020, approximately 41.7 % and 44.5 %, respectively, of the Company's CMO holdings, were invested in the above mentioned types of CMOs such as interest-only or principal-only strips, that are subject to more prepayment and extension risk than traditional CMOs.

Public corporate fixed maturity securities are distinguished from private corporate fixed maturity securities based upon the manner in which they are transacted. Public corporate fixed maturity securities are issued initially through market intermediaries on a registered basis or pursuant to Rule 144A under the Securities Act of 1933 (the "Securities Act") and are traded on the secondary market through brokers acting as principal. Private corporate fixed maturity securities are originally issued by borrowers directly to investors pursuant to Section 4(a)(2) of the Securities Act, and are traded in the secondary market directly with counterparties, either without the participation of a broker or in agency transactions.

Repurchase Agreements

As of September 30, 2021 and December 31, 2020, the Company did no t have any securities pledged in dollar rolls or reverse repurchase agreements. As of September 30, 2021, the carrying value of securities pledged and obligation to repay loans related to repurchase agreement transactions were $ 125 and included in Securities pledged and Payables under securities loan and repurchase agreements, including collateral held on the Condensed Consolidated Balance Sheets. As of December 31, 2020, the carrying value of securities pledged and obligation to repay loans related to repurchase agreement transactions were $ 82 . Securities pledged related to repurchase agreements are comprised of other asset-backed securities.

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Securities Pledged

The Company engages in securities lending whereby the initial collateral is required at a rate of 103 % of the market value of the loaned securities. The lending agent retains the collateral and invests it in high quality liquid assets on behalf of the Company. The market value of the loaned securities is monitored on a daily basis with additional collateral obtained or refunded as the market value of the loaned securities fluctuates. The lending agent indemnifies the Company against losses resulting from the failure of a counterparty to return securities pledged where collateral is insufficient to cover the loss. As of September 30, 2021 and December 31, 2020, the fair value of loaned securities was $ 989 and $ 197 , respectively, and is included in Securities pledged on the Condensed Consolidated Balance Sheets.

If cash is received as collateral, the lending agent retains the cash collateral and invests it in short-term liquid assets on behalf of the Company. As of September 30, 2021 and December 31, 2020, cash collateral retained by the lending agent and invested in short-term liquid assets on the Company's behalf was $ 950 and $ 106 , respectively, and is recorded in Short-term investments under securities loan agreements, including collateral delivered on the Condensed Consolidated Balance Sheets. As of September 30, 2021 and December 31, 2020, liabilities to return collateral of $ 950 and $ 106 , respectively, are included in Payables under securities loan and repurchase agreements, including collateral held on the Condensed Consolidated Balance Sheets.

The Company accepts non-cash collateral in the form of securities. The securities retained as collateral by the lending agent may not be sold or re-pledged, except in the event of default, and are not reflected on the Company’s Condensed Consolidated Balance Sheets. This collateral generally consists of U.S. Treasury, U.S. Government agency securities and MBS pools. As of September 30, 2021 and December 31, 2020, the fair value of securities retained as collateral by the lending agent on the Company’s behalf was $ 74 and $ 96 , respectively.

The following table presents borrowings under securities lending transactions by asset class pledged as of the dates indicated:

			September 30, 2021						December 31, 2020
U.S. Treasuries			$	82					$	90
U.S. Government agencies and authorities			3						3
U.S. corporate public securities			607						76
Equity Securities			2						—
Foreign corporate public securities and foreign governments			330						33
Payables under securities loan agreements			$	1,024					$	202

The Company's securities lending activities are conducted on an overnight basis, and all securities loaned can be recalled at any time. The Company does not offset assets and liabilities associated with its securities lending program. The program size was temporarily reduced during 2020 as part of COVID risk reduction measures. However, with financial market conditions now recovered and orderly, our securities lending program is returning to prior levels and remains within our internal risk limits.

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Allowance for credit losses

The following table presents a rollforward of the allowance for credit losses on available-for-sale fixed maturity securities for the period presented:

			Nine Months Ended September 30, 2021
			Residential mortgage-backed securities						Commercial mortgage-backed securities						Foreign corporate private securities						Other asset-backed securities						Total
Balance as of January 1			$	2					$	1					$	15					$	8					$	26
Credit losses on securities for which credit losses were not previously recorded			—						—						15						1						16
Initial allowance for credit losses recognized on financial assets accounted for as PCD			—						—						—						—						—
Reductions for securities sold during the period			—						—						—						( 1 )						( 1 )
Reductions for intent to sell or more likely than not will be required to sell securities prior to recovery of amortized cost			—						—						—						—						—
Change in allowance due to transfer of loans from Voya Reinsurance portfolios to Resolution			—						—						1						—						1
Increase (decrease) on securities with allowance recorded in previous period			( 1 )						( 1 )						—						( 7 )						( 9 )
Write-offs			—						—						—						—						—
Recoveries of amounts previously written-off			—						—						—						—						—
Balance as of September 30			$	1					$	—					$	31					$	1					$	33

			Year Ended December 31, 2020
			Residential mortgage-backed securities						Commercial mortgage-backed securities						Foreign corporate private securities						Other asset-backed securities						Total
Balance as of January 1			$	—					$	—					$	—					$	—					$	—
Credit losses on securities for which credit losses were not previously recorded			2						1						15						8						26
Initial allowance for credit losses recognized on financial assets accounted for as PCD			—						—						—						—						—
Reductions for securities sold during the period			—						—						—						—						—
Reductions for intent to sell or more likely than not will be required to sell securities prior to recovery of amortized cost			—						—						—						—						—
Increase (decrease) on securities with allowance recorded in previous period			—						—						—						—						—
Write-offs			—						—						—						—						—
Recoveries of amounts previously written-off			—						—						—						—						—
Balance as of December 31			$	2					$	1					$	15					$	8					$	26

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Unrealized Capital Losses

The following table presents available-for-sale fixed maturities, including securities pledged, for which an allowance for credit losses has not been recorded by market sector and duration as of September 30, 2021:

			Twelve Months or Less Below Amortized Cost																								More Than Twelve Months Below Amortized Cost																		Total
			Fair Value						Unrealized Capital Losses						Number of securities																		Fair Value						Unrealized Capital Losses						Number of securities						Fair Value						Unrealized Capital Losses						Number of securities
U.S. Treasuries			$	28					$	—					8																		$	12					$	—					2						$	40					$	—					10
State, municipalities and political subdivisions			56						1						21																		—						—						—						56						1						21
U.S. corporate public securities			1,554						38						305																		93						5						109						1,647						43						414
U.S. corporate private securities			238						3						15																		127						19						9						365						22						24
Foreign corporate public securities and foreign governments			446						15						82																		14						2						15						460						17						97
Foreign corporate private securities			9						—						3																		59						3						5						68						3						8
Residential mortgage-backed			629						12						198																		267						12						107						896						24						305
Commercial mortgage-backed			590						6						98																		233						11						34						823						17						132
Other asset-backed			229						3						76																		118						3						58						347						6						134
Total			$	3,779					$	78					806																		$	923					$	55					339						$	4,702					$	133					1,145

The Company concluded that an allowance for credit losses was unnecessary for these securities because the unrealized losses are interest rate related.

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The following table presents available-for-sale fixed maturities, including securities pledged, for which an allowance for credit losses has not been recorded by market sector and duration as of December 31, 2020:

			Twelve Months or Less Below Amortized Cost																								More Than Twelve Months Below Amortized Cost																		Total
			Fair Value						Unrealized Capital Losses						Number of securities																		Fair Value						Unrealized Capital Losses						Number of securities						Fair Value						Unrealized Capital Losses						Number of securities
U.S. Treasuries			$	12					$	—					2																		$	—					$	—					—						$	12					$	—					2
State, municipalities and political subdivisions			7						—						2																		—						—						—						7						—						2
U.S. corporate public securities			241						5						163																		23						2						4						264						7						167
U.S. corporate private securities			419						12						30																		112						23						8						531						35						38
Foreign corporate public securities and foreign governments			45						—						19																		9						1						2						54						1						21
Foreign corporate private securities			238						29						19																		6						—						1						244						29						20
Residential mortgage-backed			658						12						150																		147						5						75						805						17						225
Commercial mortgage-backed			844						39						127																		36						1						7						880						40						134
Other asset-backed			261						2						61																		376						8						110						637						10						171
Total			$	2,725					$	99					573																		$	709					$	40					207						$	3,434					$	139					780

Based on the Company's quarterly evaluation of its securities in a unrealized loss position, described below, the Company concluded that these securities were not impaired as of September 30, 2021. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases.

Gross unrealized capital losses on fixed maturities, including securities pledged, decreased $ 6 from $ 139 to $ 133 for the nine months ended September 30, 2021. The decrease in gross unrealized capital losses was primarily due to non-credit related market factors.

At September 30, 2021, $ 5 of the total $ 133 of gross unrealized losses were from 6 available-for-sale fixed maturity securities with an unrealized loss position of 20% or more of amortized cost for 12 months or greater.

Evaluating Securities for Impairments

The Company performs a regular evaluation, on a security-by-security basis, of its available-for-sale securities holdings, including fixed maturity securities, in accordance with its impairment policy in order to evaluate whether such investments are impaired.

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The following table identifies the Company's intent impairments included in the Condensed Consolidated Statements of Operations, excluding impairments included in Other comprehensive income (loss) by type for the periods indicated:

			Three Months Ended September 30,
			2021												2020
			Impairment						No. of Securities						Impairment						No. of Securities
State, municipalities and political subdivisions			$	—					—						$	—		*			2
U.S. corporate public securities			—						—						2						18
U.S. corporate private securities			—						—						1						4
Foreign corporate public securities and foreign governments (1)			—						—						—			*			12
Foreign corporate private securities (1)			—						—						2						5
Residential mortgage-backed			—			*			2						1						24
Commercial mortgage-backed			—						—						4						18
Other asset-backed			—						—						—			*			1
Total			$	—		*			2						$	10					84
(1) Primarily U.S. dollar denominated.
*Less than $1
			Nine Months Ended September 30,
			2021												2020
			Impairment						No. of Securities						Impairment						No. of Securities
State, municipalities and political subdivisions			$	—					—						$	—		*			13
U.S. corporate public securities			—						—						32						80
U.S. corporate private securities			—						—						1						9
Foreign corporate public securities and foreign governments (1)			—						—						4						39
Foreign corporate private securities (1)			—						—						8						17
Residential mortgage-backed			—			*			10						6						56
Commercial mortgage-backed			—			*			1						28						124
Other asset-backed			—						—						1						74
Total			$	—		*			11						$	80					412
(1) Primarily U.S. dollar denominated.
*Less than $1

The Company may sell securities during the period in which fair value has declined below amortized cost for fixed maturities. In certain situations, new factors, including changes in the business environment, can change the Company’s previous intent to continue holding a security. Accordingly, these factors may lead the Company to record additional intent related capital losses.

Troubled Debt Restructuring

The Company invests in high quality, well performing portfolios of commercial mortgage loans and private placements. Under certain circumstances, modifications are granted to these contracts. Each modification is evaluated as to whether a troubled debt restructuring has occurred. A modification is a troubled debt restructuring when the borrower is in financial difficulty and the creditor makes concessions. Generally, the types of concessions may include reducing the face amount or maturity amount of the debt as originally stated, reducing the contractual interest rate, extending the maturity date at an interest rate lower than current market interest rates and/or reducing accrued interest. The Company considers the amount, timing and extent of the concession granted in determining any impairment or changes in the specific valuation allowance recorded in connection with the troubled debt restructuring. A valuation allowance may have been recorded prior to the quarter when the loan is modified in a troubled debt restructuring. Accordingly, the carrying value (net of the valuation allowance) before and after modification through a troubled debt restructuring may not change significantly, or may increase if the expected recovery is higher than the

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pre-modification recovery assessment. For the three months ended September 30, 2021, the Company did no t have any new commercial mortgage loan troubled debt restructuring. For the nine months ended September 30, 2021, the Company had one new commercial mortgage loan troubled debt restructuring with a pre and post modification carrying value of $ 5 . For the three and nine months ended September 30, 2021, the Company did no t have any new private placement troubled debt restructuring. For the three and nine months ended September 30, 2020, the Company had one new commercial mortgage loan trouble debt restructuring with a pre and post modification carrying value of $ 3 . For the three and nine months ended September 30, 2020, the Company did not have any new private placement troubled debt restructuring.

For the three and nine months ended September 30, 2021 and September 30, 2020, the Company did no t have any commercial mortgage loans or private placements modified in a troubled debt restructuring with a subsequent payment default.

Mortgage Loans on Real Estate

The Company diversifies its commercial mortgage loan portfolio by geographic region and property type to reduce concentration risk. The Company manages risk when originating commercial mortgage loans by generally lending only up to 75 % of the estimated fair value of the underlying real estate. Subsequently, the Company continuously evaluates mortgage loans based on relevant current information including a review of loan-specific performance, property characteristics and market trends. Loan performance is monitored on a loan specific basis through the review of submitted appraisals, operating statements, rent revenues and annual inspection reports, among other items. This review ensures properties are performing at a consistent and acceptable level to secure the debt. The components to evaluate debt service coverage are received and reviewed at least annually to determine the level of risk.

Loan-to-value ("LTV") and debt service coverage ("DSC") ratios are measures commonly used to assess the risk and quality of mortgage loans. The LTV ratio, calculated at time of origination, is expressed as a percentage of the amount of the loan relative to the value of the underlying property. A LTV ratio in excess of 100 % indicates the unpaid loan amount exceeds the underlying collateral. The DSC ratio, based upon the most recently received financial statements, is expressed as a percentage of the amount of a property’s net income to its debt service payments. A DSC ratio of less than 1.0 indicates that a property’s operations do not generate sufficient income to cover debt payments. These ratios are utilized as part of the review process described above.

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The following tables present commercial mortgage loans by year of origination and LTV ratio as of the dates indicated. The information is updated as of September 30, 2021 and December 31, 2020, respectively.

			As of September 30, 2021
			Loan-to-Value Ratios
Year of Origination			0 % - 50 %						> 50 % - 60 %						> 60 % - 70 %						> 70 % - 80 %						> 80 % and above						Total
2021			$	103					$	264					$	141					$	—					$	—					$	508
2020			176						230						77						—						—						483
2019			227						213						86						—						—						526
2018			170						50						2						—						—						222
2017			678						228						4						—						—						910
2016			427						249						2						—						—						678
2015 and prior			1,901						349						21						—						—						2,271
Total			$	3,682					$	1,583					$	333					$	—					$	—					$	5,598

			As of December 31, 2020
			Loan-to-Value Ratios
Year of Origination			0 % - 50 %						> 50 % - 60 %						> 60 % - 70 %						> 70 % - 80 %						> 80 % and above						Total
2020			$	202					$	251					$	39					$	—					$	—					$	492
2019			327						230						125						—						—						682
2018			211						158						73						—						—						442
2017			645						427						5						—						—						1,077
2016			627						313						2						—						—						942
2015 and prior			2,525						648						22						—						—						3,195
Total			$	4,537					$	2,027					$	266					$	—					$	—					$	6,830

The following tables present commercial mortgage loans by year of origination and DSC ratio as of the dates indicated. The information is updated as of September 30, 2021 and December 31, 2020, respectively.

			As of September 30, 2021
			Debt Service Coverage Ratios
Year of Origination			> 1.5 x						> 1.25 x - 1.5 x						> 1.0 x - 1.25 x						< 1.0 x						Commercial mortgage loans secured by land or construction loans						Total
2021			$	487					$	21					$	—					$	—					$	—					$	508
2020			418						31						34						—						—						483
2019			285						100						85						56						—						526
2018			131						5						55						31						—						222
2017			425						361						116						8						—						910
2016			599						53						4						22						—						678
2015 and prior			1,797						221						198						55						—						2,271
Total			$	4,142					$	792					$	492					$	172					$	—					$	5,598

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			As of December 31, 2020
			Debt Service Coverage Ratios
Year of Origination			> 1.5 x						> 1.25 x - 1.5 x						> 1.0 x - 1.25 x						< 1.0 x						Commercial mortgage loans secured by land or construction loans						Total
2020			$	356					$	116					$	20					$	—					$	—					$	492
2019			455						108						51						68						—						682
2018			205						90						92						55						—						442
2017			630						243						133						71						—						1,077
2016			841						58						40						3						—						942
2015 and prior			2,714						283						121						77						—						3,195
Total			$	5,201					$	898					$	457					$	274					$	—					$	6,830

The following tables present the commercial mortgage loans by year of origination and U.S. region as of the dates indicated. The information is updated as of September 30, 2021 and December 31, 2020, respectively.

			As of September 30, 2021
			U.S. Region
Year of Origination			Pacific						South Atlantic						Middle Atlantic						West South Central						Mountain						East North Central						New England						West North Central						East South Central						Total
2021			$	77					$	41					$	28					$	103					$	104					$	105					$	9					$	19					$	22					$	508
2020			99						186						40						40						38						39						2						14						25						483
2019			62						146						14						152						48						42						15						13						34						526
2018			54						69						59						10						14						10						—						6						—						222
2017			129						94						372						140						76						56						6						37						—						910
2016			147						140						168						41						58						89						11						18						6						678
2015 and prior			595						493						426						151						204						186						61						125						30						2,271
Total			$	1,163					$	1,169					$	1,107					$	637					$	542					$	527					$	104					$	232					$	117					$	5,598

			As of December 31, 2020
			U.S. Region
Year of Origination			Pacific						South Atlantic						Middle Atlantic						West South Central						Mountain						East North Central						New England						West North Central						East South Central						Total
2020			$	107					$	187					$	41					$	39					$	38					$	39					$	2					$	15					$	24					$	492
2019			98						194						21						169						69						61						18						13						39						682
2018			105						141						70						37						59						15						—						15						—						442
2017			172						125						417						155						102						62						6						38						—						1,077
2016			274						174						185						46						103						114						13						27						6						942
2015 and prior			890						684						521						237						299						290						70						160						44						3,195
Total			$	1,646					$	1,505					$	1,255					$	683					$	670					$	581					$	109					$	268					$	113					$	6,830

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The following tables present the commercial mortgage loans by year of origination and property type as of the dates indicated. The information is updated as of September 30, 2021 and December 31, 2020, respectively.

			As of September 30, 2021
			Property Type
Year of Origination			Retail						Industrial						Apartments						Office						Hotel/Motel						Other						Mixed Use						Total
2021			$	20					$	52					$	309					$	109					$	—					$	9					$	9					$	508
2020			58						90						168						167						—						—						—						483
2019			46						97						274						82						27						—						—						526
2018			37						88						58						16						4						19						—						222
2017			111						444						196						156						3						—						—						910
2016			129						246						140						155						—						5						3						678
2015 and prior			858						328						441						294						94						205						51						2,271
Total			$	1,259					$	1,345					$	1,586					$	979					$	128					$	238					$	63					$	5,598

			As of December 31, 2020
			Property Type
Year of Origination			Retail						Industrial						Apartments						Office						Hotel/Motel						Other						Mixed Use						Total
2020			$	59					$	94					$	165					$	174					$	—					$	—					$	—					$	492
2019			55						111						384						95						37						—						—						682
2018			77						109						191						25						5						35						—						442
2017			138						505						252						178						4						—						—						1,077
2016			175						301						255						187						10						9						5						942
2015 and prior			1,276						484						570						426						117						268						54						3,195
Total			$	1,780					$	1,604					$	1,817					$	1,085					$	173					$	312					$	59					$	6,830

The following table summarizes the activity in the allowance for losses for commercial mortgage loans for the periods indicated:

			September 30, 2021			December 31, 2020
Allowance for credit losses, beginning of period			$	89		$	16		(1)
Credit losses on mortgage loans for which credit losses were not previously recorded			1			7
Change in allowance due to transfer of loans from Voya Reinsurance portfolios to Resolution			( 14 )			—
Increase (decrease) on mortgage loans with allowance recorded in previous period			( 57 )			69
Provision for expected credit losses			19			92
Write-offs			—			( 3 )
Recoveries of amounts previously written-off			—			—
Allowance for credit losses, end of period			$	19		$	89

(1) On January 1, 2020, as a result of implementing ASU 2016-13 Measurement of Credit Losses of Financial Instruments, the company recorded a transition adjustment for Allowance for credit losses on mortgage loans on real estate of $ 15 .

To provide temporary financial assistance to our commercial mortgage loans borrowers adversely affected by COVID-19 related stress, the Company has provided payment forbearance to approximately 8 % of the outstanding principal amount of our commercial mortgage loans. Deferred payment amounts are expected to be repaid across the 12 months following the end of the

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agreed upon forbearance period. No modifications to any commercial mortgage loans have been made as of the issuance date of this filing.

The following table presents past due commercial mortgage loans as of the dates indicated:

			September 30, 2021						December 31, 2020
Delinquency:
Current			$	5,598					$	6,825
30-59 days past due			—						—
60-89 days past due			—						—
Greater than 90 days past due			—						5
Total			$	5,598					$	6,830

Commercial mortgage loans are placed on non-accrual status when 90 days in arrears if the Company has concerns regarding the collectability of future payments, or if a loan has matured without being paid off or extended. As of September 30, 2021, the company had no commercial mortgage loan in non-accrual status. As of December 31, 2020, the Company had one commercial mortgage loan in non-accrual status. There was no interest income recognized on loans in non-accrual status for the nine months ended September 30, 2021 and year ended December 31, 2020.

As of September 30, 2021 and December 31, 2020, the Company had no commercial mortgage loans that were over 90 days or more past due but are not on non-accrual status. The Company had no commercial mortgage loans on non-accrual status for which there is no related allowance for credit losses as of September 30, 2021 and December 31, 2020.

Fixed Maturities, Trading

The Company invests in corporate private debt securities which are recognized at fair value within the Condensed Consolidated Balance Sheets with changes in value recognized in Other net realized capital gains (losses) in the Condensed Consolidated Statements of Operations. For the three months and nine months ended September 30, 2021, there were no gains (losses) and $ 1 of interest income. For the three months and nine months ended September 30, 2020 there were no gains (losses) and no interest income.

Net Investment Income

The following table summarizes Net investment income for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Fixed maturities			$	501					$	618					$	1,513					$	1,785
Equity securities			4						4						15						10
Mortgage loans on real estate			59						74						184						221
Policy loans			7						11						18						34
Short-term investments and cash equivalents			2						—						7						3
Other			175						113						415						85
Gross investment income			748						820						2,152						2,138
Less: Investment expenses			17						20						51						54
Net investment income			$	731					$	800					$	2,101					$	2,084

As of September 30, 2021, the Company had no investments in fixed maturities that did not produce net investment income. As of December 31, 2020, the Company had $ 2 of investments in fixed maturities that did not produce net investment income. Fixed maturities are moved to a non-accrual status when the investment defaults.

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Interest income on fixed maturities is recorded when earned using an effective yield method, giving effect to amortization of premiums and accretion of discounts. Such interest income is recorded in Net investment income in the Condensed Consolidated Statements of Operations.

Net Realized Capital Gains (Losses)

Net realized capital gains (losses) comprise the difference between the amortized cost of investments and proceeds from sale and redemption, as well as losses incurred due to the credit-related and intent-related impairment of investments. Realized investment gains and losses are also primarily generated from changes in fair value of embedded derivatives within products and fixed maturities, changes in fair value of fixed maturities recorded at FVO and changes in fair value including accruals on derivative instruments, except for effective cash flow hedges. Net realized capital gains (losses) also include changes in fair value of trading debt securities and changes in fair value of equity securities. The cost of the investments on disposal is generally determined based on first-in-first-out ("FIFO") methodology.

Net realized capital gains (losses) were as follows for the periods indicated:

			Three Months Ended September 30,
			2021						2020
Fixed maturities, available-for-sale, including securities pledged			$	6					$	( 7 )
Fixed maturities, at fair value option			( 137 )						( 131 )
Equity securities, at fair value			1						7
Derivatives			11						11
Embedded derivatives - fixed maturities			( 1 )						( 3 )
Guaranteed benefit derivatives			1						35
Mortgage Loans			14						17
Other investments			2						1
Net realized capital gains (losses)			$	( 103 )					$	( 70 )
			Nine Months Ended September 30,
			2021						2020
Fixed maturities, available-for-sale, including securities pledged			$	1,789					$	( 59 )
Fixed maturities, at fair value option			( 514 )						( 84 )
Equity securities, at fair value			12						11
Derivatives			( 5 )						( 22 )
Embedded derivatives - fixed maturities			( 6 )						4
Guaranteed benefit derivatives			49						( 113 )
Mortgage Loans			177						( 41 )
Other investments			100						—
Net realized capital gains (losses)			$	1,602					$	( 304 )

On June 1, 2021, the Company fully disposed of a 9.99 % equity interest in VA Capital which was originally acquired as part of a Master Transaction Agreement dated December 20, 2017, related to the sale of substantially all of our Closed Block Variable Annuity (CBVA) and Annuity business. The disposition resulted in a net realized gain of $ 95 reported as Other net realized capital gains (losses) in the Condensed Consolidated Statements of Operations.

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Proceeds from the sale of fixed maturities, available-for-sale and trading, and equity securities and the related gross realized gains and losses, before tax, were as follows for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Proceeds on sales			$	369					$	341					$	10,582					$	1,706
Gross gains			22						7						1,733						97
Gross losses			1						4						3						73

The Company primarily enters into the following types of derivatives:

Interest rate swaps: Interest rate swaps are used by the Company primarily to reduce market risks from changes in interest rates and to alter interest rate exposure arising from mismatches between assets and/or liabilities. Interest rate swaps are also used to hedge the interest rate risk associated with the value of assets it owns or in an anticipation of acquiring them. Using interest rate swaps, the Company agrees with another party to exchange, at specified intervals, the difference between fixed rate and floating rate interest payments, calculated by reference to an agreed upon notional principal amount. These transactions are entered into pursuant to master agreements that provide for a single net payment to be made to/from the counterparty at each due date. The Company utilizes these contracts in qualifying hedging relationships as well as non-qualifying hedging relationships.

Foreign exchange swaps: The Company uses foreign exchange or currency swaps to reduce the risk of change in the value, yield or cash flows associated with certain foreign denominated invested assets. Foreign exchange swaps represent contracts that require the exchange of foreign currency cash flows against U.S. dollar cash flows at regular periods, typically quarterly or semi-annually. The Company utilizes these contracts in qualifying hedging relationships as well as non-qualifying hedging relationships.

Total return swaps: The Company uses total return swaps as a hedge of interest related risks within various Legacy Annuity and Retirement products. Total return swaps are also used as a hedge of other corporate liabilities. Using total return swaps, the Company agrees with another party to exchange, at specified intervals, the difference between the economic performance of assets or a market index and a fixed or variable funding multiplied by reference to an agreed upon notional amount. No cash is exchanged at the onset of the contracts. Cash is paid and received over the life of the contract based upon the terms of the swaps. The Company utilized these contracts in non-qualifying hedging relationships.

Futures: Futures contracts are used to hedge against a decrease in certain equity indices. Such decreases may correlate to a decrease in variable annuity account values which would increase the possibility of the Company incurring an expense for guaranteed benefits in excess of account values. The Company also uses interest rate futures contracts to hedge its exposure to market risks due to changes in interest rates. The Company enters into exchange traded futures with regulated futures commissions that are members of the exchange. The Company also posts initial and variation margins, with the exchange, on a daily basis. The Company utilizes exchange-traded futures in non-qualifying hedging relationships. The Company may also use futures contracts as a hedge against an increase in certain equity indices.

Embedded derivatives: The Company also invests in certain fixed maturity instruments and has issued certain products that contain embedded derivatives for which market value is at least partially determined by, among other things, levels of or changes in domestic and/or foreign interest rates (short-term or long-term), exchange rates, prepayment rates, equity rates or credit ratings/spreads. In addition, the Company has entered into coinsurance with funds withheld arrangements, which contain embedded derivatives.

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The notional amounts and fair values of derivatives were as follows as of the dates indicated:

			September 30, 2021																		December 31, 2020
			Notional Amount						Asset Fair Value						Liability Fair Value						Notional Amount						Asset Fair Value						Liability Fair Value
Derivatives: Qualifying for hedge accounting (1)
Fair value hedges:
Foreign exchange contracts			$	90					$	2					$	—					$	—					$	—					$	—
Cash flow hedges:
Interest rate contracts			22						—						—						22						—						—
Foreign exchange contracts			683						14						17						756						4						43
Derivatives: Non-qualifying for hedge accounting (1)
Interest rate contracts			16,889						118						248						19,837						195						328
Foreign exchange contracts			145						1						2						122						—						3
Equity contracts			320						3						3						412						16						12
Credit contracts			138						1						1						223						—						1
Embedded derivatives and Managed custody guarantees:
Within fixed maturity investments			N/A						14						—						N/A						20						—
Within products			N/A						—						43						N/A						—						95
Within reinsurance agreements			N/A						—						231						N/A						—						163
Managed custody guarantees			N/A						—						1						N/A						—						4
Total									$	153					$	546											$	235					$	649

(1) Open derivative contracts are reported as Derivatives assets or liabilities on the Condensed Consolidated Balance Sheets at fair value.

N/A - Not applicable

Based on the notional amounts, a substantial portion of the Company’s derivative positions was not designated or did not qualify for hedge accounting as part of a hedging relationship as of September 30, 2021 and December 31, 2020. The Company utilizes derivative contracts mainly to hedge exposure to variability in cash flows, interest rate risk, credit risk, foreign exchange risk and equity market risk. The majority of derivatives used by the Company are designated as product hedges, which hedge the exposure arising from insurance liabilities or guarantees embedded in the contracts the Company offers through various product lines. These derivatives do not qualify for hedge accounting as they do not meet the criteria of being "highly effective" as outlined in ASC Topic 815, but do provide an economic hedge, which is in line with the Company’s risk management objectives. The Company also uses derivatives contracts to hedge its exposure to various risks associated with the investment portfolio. The Company does not seek hedge accounting treatment for certain of these derivatives as they generally do not qualify for hedge accounting due to the criteria required under the portfolio hedging rules outlined in ASC Topic 815. The Company also uses credit default swaps coupled with other investments in order to produce the investment characteristics of otherwise permissible investments that do not qualify as effective accounting hedges under ASC Topic 815.

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Although the Company has not elected to net its derivative exposures, the notional amounts and fair values of Over-The-Counter ("OTC") and cleared derivatives excluding exchange traded contracts are presented in the tables below as of the dates indicated:

			September 30, 2021
			Notional Amount						Asset Fair Value						Liability Fair Value
Credit contracts			$	138					$	1					$	1
Equity contracts			234						3						3
Foreign exchange contracts			918						17						19
Interest rate contracts			14,765						118						248
									139						271
Counterparty netting (1)									( 130 )						( 130 )
Cash collateral netting (1)									( 4 )						( 119 )
Securities collateral netting (1)									( 3 )						( 15 )
Net receivables/payables									$	2					$	7

(1) Represents the netting of receivable balances with payable balances, net of collateral, for the same counterparty under eligible netting agreements.

			December 31, 2020
			Notional Amount						Asset Fair Value						Liability Fair Value
Credit contracts			$	223					$	—					$	1
Equity contracts			306						16						12
Foreign exchange contracts			878						4						46
Interest rate contracts			17,331						195						328
									215						387
Counterparty netting (1)									( 207 )						( 207 )
Cash collateral netting (1)									( 2 )						( 140 )
Securities collateral netting (1)									—						( 35 )
Net receivables/payables									$	6					$	5

(1) Represents the netting of receivable balances with payable balances, net of collateral, for the same counterparty under eligible netting agreements.

Collateral

Under the terms of the OTC Derivative International Swaps and Derivatives Association, Inc. ("ISDA") agreements, the Company may receive from, or deliver to, counterparties collateral to assure that terms of the ISDA agreements will be met with regard to the Credit Support Annex ("CSA"). The terms of the CSA call for the Company to pay interest on any cash received equal to the Federal Funds rate. To the extent cash collateral is received and delivered, it is included in Payables under securities loan and repurchase agreements, including collateral held and Short-term investments under securities loan agreements, including collateral delivered, respectively, on the Condensed Consolidated Balance Sheets and is reinvested in short-term investments. Collateral held is used in accordance with the CSA to satisfy any obligations. Investment grade bonds owned by the Company are the source of noncash collateral posted, which is reported in Securities pledged on the Condensed Consolidated Balance Sheets.

As of September 30, 2021, the Company pledged $ 2 and $ 117 of net cash collateral related to OTC derivative contracts and cleared derivative contracts, respectively. As of December 31, 2020, the Company held $ 5 and $ 140 of net cash collateral related to OTC derivative contracts and cleared derivative contracts, respectively. In addition, as of September 30, 2021, the Company delivered $ 206 of securities and held $ 3 of securities as collateral. As of December 31, 2020, the Company delivered $ 170 of securities and held no securities as collateral.

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The location and effect of derivatives qualifying for hedge accounting on the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income are as follows for the period indicated:

			Three Months Ended September 30,
			2021												2020
			Interest Rate Contracts						Foreign Exchange Contracts						Interest Rate Contracts						Foreign Exchange Contracts
Derivatives: Qualifying for hedge accounting
Location of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income			Net investment income						Net investment income and Other net realized capital gains/(losses)						Net investment income						Net investment income and Other net realized capital gains/(losses)
Amount of Gain or (Loss) Recognized in Other Comprehensive Income			$	—					$	24					$	—					$	( 42 )
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income			—						3						—						—
			Nine Months Ended September 30,
			2021												2020
			Interest Rate Contracts						Foreign Exchange Contracts						Interest Rate Contracts						Foreign Exchange Contracts
Derivatives: Qualifying for hedge accounting
Location of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income			Net investment income						Net investment income and Other net realized capital gains/(losses)						Net investment income						Net investment income and Other net realized capital gains/(losses)
Amount of Gain or (Loss) Recognized in Other Comprehensive Income			$	( 1 )					$	36					$	2					$	31
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income			—						2						—						6

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The location and amount of gain (loss) recognized in the Condensed Consolidated Statements of Operations for derivatives qualifying for hedge accounting are as follows for the period indicated:

			Three Months Ended September 30,
			2021												2020
			Net investment income						Other net realized capital gains/(losses)						Net investment income						Other net realized capital gains/(losses)
Total amounts of line items presented in the statement of operations in which the effects of fair value or cash flow hedges are recorded			$	731					$	( 103 )					$	800					$	( 60 )
Derivatives: Qualifying for hedge accounting
Fair value hedges:
Foreign exchange contracts:
Hedged items			—						( 2 )						—						—
Derivatives designated as hedging instruments (1)			—						2						—						—
Cash flow hedges:
Foreign exchange contracts:
Gain (loss) reclassified from accumulated other comprehensive income into income			3						—						3						( 3 )
			Nine Months Ended September 30,
			2021												2020
			Net investment income						Other net realized capital gains/(losses)						Net investment income						Other net realized capital gains/(losses)
Total amounts of line items presented in the statement of operations in which the effects of fair value or cash flow hedges are recorded			$	2,101					$	1,602					$	2,084					$	( 224 )
Derivatives: Qualifying for hedge accounting
Fair value hedges:
Foreign exchange contracts:
Hedged items			—						( 3 )						—						—
Derivatives designated as hedging instruments (1)			—						3						—						—
Cash flow hedges:
Foreign exchange contracts:
Gain (loss) reclassified from accumulated other comprehensive income into income			7						( 5 )						9						( 3 )

(1) An immaterial portion of the change in derivative instruments designated and qualifying as fair value hedges was excluded from the assessment of hedge effectiveness and recognized currently in earnings.

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The location and effect of derivatives not designated as hedging instruments on the Condensed Consolidated Statements of Operations are as follows for the periods indicated:

			Location of Gain or (Loss) Recognized in Income on Derivative						Three Months Ended September 30,
									2021						2020
Derivatives: Non-qualifying for hedge accounting
Interest rate contracts			Other net realized capital gains (losses)						$	10					$	21
Foreign exchange contracts			Other net realized capital gains (losses)						—						( 4 )
Equity contracts			Other net realized capital gains (losses)						( 1 )						( 2 )
Credit contracts			Other net realized capital gains (losses)						—						( 1 )
Embedded derivatives and Managed custody guarantees:
Within fixed maturity investments			Other net realized capital gains (losses)						( 1 )						( 3 )
Within products			Other net realized capital gains (losses)						7						28
Within reinsurance agreements (1)			Policyholder benefits						18						8
Managed custody guarantees			Other net realized capital gains (losses)						( 1 )						7
Total									$	32					$	54
			Location of Gain or (Loss) Recognized in Income on Derivative						Nine Months Ended September 30,
									2021						2020
Derivatives: Non-qualifying for hedge accounting
Interest rate contracts			Other net realized capital gains (losses)						$	( 13 )					$	( 12 )
Foreign exchange contracts			Other net realized capital gains (losses)						( 2 )						2
Equity contracts			Other net realized capital gains (losses)						11						( 11 )
Credit contracts			Other net realized capital gains (losses)						1						3
Embedded derivatives and Managed custody guarantees:
Within fixed maturity investments			Other net realized capital gains (losses)						( 6 )						4
Within products			Other net realized capital gains (losses)						38						( 103 )
Within reinsurance agreements (1)			Policyholder benefits						41						( 52 )
Managed custody guarantees			Other net realized capital gains (losses)						3						( 10 )
Total									$	73					$	( 179 )

(1) Excludes gains (losses) from standalone derivatives of $( 1 ) and $ 3 for the three and nine months ended September 30, 2021, respectively, that are recognized in Other net realized capital gains (losses).

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Fair Value Measurement

The following table presents the Company's hierarchy for its assets and liabilities measured at fair value on a recurring basis as of September 30, 2021:

			Level 1						Level 2						Level 3						Total
Assets:
Fixed maturities, including securities pledged:
U.S. Treasuries			$	751					$	261					$	—					$	1,012
U.S. Government agencies and authorities			—						81						—						81
State, municipalities and political subdivisions			—						1,075						—						1,075
U.S. corporate public securities			—						12,364						35						12,399
U.S. corporate private securities			—						3,356						1,934						5,290
Foreign corporate public securities and foreign governments (1)			—						3,768						17						3,785
Foreign corporate private securities (1)			—						3,262						381						3,643
Residential mortgage-backed securities			—						4,586						56						4,642
Commercial mortgage-backed securities			—						4,080						12						4,092
Other asset-backed securities			—						2,099						50						2,149
Total fixed maturities, including securities pledged			751						34,932						2,485						38,168
Fixed maturities, trading			—						—						5						5
Equity securities			38						—						250						288
Derivatives:
Interest rate contracts			—						118						—						118
Foreign exchange contracts			—						17						—						17
Equity contracts			—						3						—						3
Credit contracts			—						1						—						1
Cash and cash equivalents, short-term investments and short-term investments under securities loan agreements			2,914						61						—						2,975
Assets held in separate accounts			91,014						5,469						311						96,794
Total assets			$	94,717					$	40,601					$	3,051					$	138,369
Percentage of Level to total			69		%				29		%				2		%				100		%
Liabilities:
Derivatives:
Guaranteed benefit derivatives (2)			—						—						44						44
Other derivatives:
Interest rate contracts			10						238						—						248
Foreign exchange contracts			—						19						—						19
Equity contracts			—						3						—						3
Credit contracts			—						1						—						1
Embedded derivative on reinsurance			—						145						86						231
Total liabilities			$	10					$	406					$	130					$	546

(1) Primarily U.S. dollar denominated.

(2) Includes GMWBL, GMWB, FIA, Stabilizer and MCGs.

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The following table presents the Company's hierarchy for its assets and liabilities measured at fair value on a recurring basis as of December 31, 2020:

			Level 1						Level 2						Level 3						Total
Assets:
Fixed maturities, including securities pledged:
U.S. Treasuries			$	1,134					$	337					$	—					$	1,471
U.S. Government agencies and authorities			—						102						—						102
State, municipalities and political subdivisions			—						1,346						—						1,346
U.S. corporate public securities			—						16,294						93						16,387
U.S. corporate private securities			—						4,546						1,900						6,446
Foreign corporate public securities and foreign governments (1)			—						4,736						—						4,736
Foreign corporate private securities (1)			—						4,189						457						4,646
Residential mortgage-backed securities			—						5,583						43						5,626
Commercial mortgage-backed securities			—						4,131						—						4,131
Other asset-backed securities			—						2,077						61						2,138
Total fixed maturities, including securities pledged			1,134						43,341						2,554						47,029
Equity securities			70						—						172						242
Derivatives:
Interest rate contracts			7						140						48						195
Foreign exchange contracts			—						4						—						4
Equity contracts			—						15						1						16
Cash and cash equivalents, short-term investments and short-term investments under securities loan agreements			1,903						109						—						2,012
Assets held in separate accounts			84,329						6,001						222						90,552
Total assets			$	87,443					$	49,610					$	2,997					$	140,050
Percentage of Level to total			63		%				35		%				2		%				100		%
Liabilities:
Derivatives:
Guaranteed benefit derivatives (2)			—						—						99						99
Other derivatives:
Interest rate contracts			—						280						48						328
Foreign exchange contracts			—						46						—						46
Equity contracts			—						12						—						12
Credit contracts			—						1						—						1
Embedded derivative on reinsurance			—						163						—						163
Total liabilities			$	—					$	502					$	147					$	649

(1) Primarily U.S. dollar denominated.

(2) Includes GMWBL, GMWB, FIA, Stabilizer and MCGs.

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Valuation of Financial Assets and Liabilities at Fair Value

Certain assets and liabilities are measured at estimated fair value on the Company’s Consolidated Balance Sheets. The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The exit price and the transaction (or entry) price will be the same at initial recognition in many circumstances. However, in certain cases, the transaction price may not represent fair value. The fair value of a liability is based on the amount that would be paid to transfer a liability to a third-party with an equal credit standing. Fair value is required to be a market-based measurement that is determined based on a hypothetical transaction at the measurement date, from a market participant’s perspective. The Company considers three broad valuation approaches when a quoted price is unavailable: (i) the market approach, (ii) the income approach and (iii) the cost approach. The Company determines the most appropriate valuation technique to use, given the instrument being measured and the availability of sufficient inputs. The Company prioritizes the inputs to fair valuation approaches and allows for the use of unobservable inputs to the extent that observable inputs are not available.

The Company utilizes a number of valuation methodologies to determine the fair values of its financial assets and liabilities in conformity with the concepts of exit price and the fair value hierarchy as prescribed in ASC Topic 820. Valuations are obtained from third-party commercial pricing services, brokers and industry-standard, vendor-provided software that models the value based on market observable inputs. The valuations obtained from third-party commercial pricing services are non-binding. The Company reviews the assumptions and inputs used by third-party commercial pricing services for each reporting period in order to determine an appropriate fair value hierarchy level. The documentation and analysis obtained from third-party commercial pricing services are reviewed by the Company, including in-depth validation procedures confirming the observability of inputs. The valuations are reviewed and validated monthly through the internal valuation committee price variance review, comparisons to internal pricing models, back testing to recent trades or monitoring of trading volumes.

The valuation approaches and key inputs for each category of assets or liabilities that are classified within Level 2 and Level 3 of the fair value hierarchy are presented below.

For fixed maturities classified as Level 2 assets, fair values are determined using a matrix-based market approach, based on prices obtained from third-party commercial pricing services and the Company’s matrix and analytics-based pricing models, which in each case incorporate a variety of market observable information as valuation inputs. The market observable inputs used for these fair value measurements, by fixed maturity asset class, are as follows:

U.S. Treasuries: Fair value is determined using third-party commercial pricing services, with the primary inputs being stripped interest and principal U.S. Treasury yield curves that represent a U.S. Treasury zero-coupon curve.

U.S. government agencies and authorities, State, municipalities and political subdivisions: Fair value is determined using third-party commercial pricing services, with the primary inputs being U.S. Treasury yield curves, trades of comparable securities, credit spreads off benchmark yields and issuer ratings.

U.S. corporate public securities, Foreign corporate public securities and foreign governments: Fair value is determined using third-party commercial pricing services, with the primary inputs being benchmark yields, trades of comparable securities, issuer ratings, bids and credit spreads off benchmark yields.

U.S. corporate private securities and Foreign corporate private securities: Fair values are determined using a matrix and analytics-based pricing model. The model incorporates the current level of risk-free interest rates, current corporate credit spreads, credit quality of the issuer and cash flow characteristics of the security. The model also considers a liquidity spread, the value of any collateral, the capital structure of the issuer, the presence of guarantees, and prices and quotes for comparably rated publicly traded securities.

RMBS, CMBS and ABS: Fair value is determined using third-party commercial pricing services, with the primary inputs being credit spreads off benchmark yields, prepayment speed assumptions, current and forecasted loss severity, debt service coverage ratios, collateral type, payment priority within tranche and the vintage of the loans underlying the security.

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Generally, the Company does not obtain more than one vendor price from pricing services per instrument. The Company uses a hierarchy process in which prices are obtained from a primary vendor and, if that vendor is unable to provide the price, the next vendor in the hierarchy is contacted until a price is obtained or it is determined that a price cannot be obtained from a commercial pricing service. When a price cannot be obtained from a commercial pricing service, independent broker quotes are solicited. Securities priced using independent broker quotes are classified as Level 3.

Fair values of privately placed bonds are determined primarily using a matrix-based pricing model and are generally classified as Level 2 assets. The model considers the current level of risk-free interest rates, current corporate spreads, the credit quality of the issuer and cash flow characteristics of the security. Also considered are factors such as the net worth of the borrower, the value of collateral, the capital structure of the borrower, the presence of guarantees and the Company’s evaluation of the borrower’s ability to compete in its relevant market. Using this data, the model generates estimated market values, which the Company considers reflective of the fair value of each privately placed bond.

Equity securities: Level 2 and Level 3 equity securities, typically private equities or equity securities not traded on an exchange, are valued by other sources such as analytics or brokers.

Derivatives: Derivatives are carried at fair value, which is determined using the Company’s derivative accounting system in conjunction with observable key financial data from third-party sources, such as yield curves, exchange rates, S&P 500 Index prices, London Interbank Offered Rates ("LIBOR") and Overnight Index Swap ("OIS") rates. The Company uses OIS for valuations of collateralized interest rate derivatives, which are obtained from third-party sources. For those derivatives that are unable to be valued by the accounting system, the Company typically utilizes values established by third-party brokers. Counterparty credit risk is considered and incorporated in the Company’s valuation process through counterparty credit rating requirements and monitoring of overall exposure. It is the Company’s policy to transact only with investment grade counterparties with a credit rating of A- or better. The Company’s nonperformance risk is also considered and incorporated in the Company’s valuation process. The Company also has certain credit default swaps and options that are priced by third party vendors or by using models that primarily use market observable inputs, but contain inputs that are not observable to market participants, which have been classified as Level 3. The remaining derivative instruments are valued based on market observable inputs and are classified as Level 2.

Guaranteed benefit derivatives: The Company records reserves for annuity contracts containing GMWBL and GMWB riders. The guarantee is an embedded derivative and is required to be accounted for separately from the host variable annuity contract. The fair value of the obligation is calculated based on actuarial and capital market assumptions related to the projected cash flows, including benefits and related contract charges, over the anticipated life of the related contracts. The cash flow estimates are produced by using stochastic techniques under a variety of market return scenarios and other market implied assumptions. These derivatives are classified as Level 3 liabilities in the fair value hierarchy.

The index-crediting feature in the Company's FIA and IUL contracts is an embedded derivative that is required to be accounted for separately from the host contract. The fair value of the obligation is calculated based on actuarial and capital market assumptions related to the projected cash flows, including benefits and related contract charges, over the anticipated life of the related contracts for FIAs and over the current indexed term for IULs. The cash flow estimates are produced by market implied assumptions. These derivatives are classified as Level 3 liabilities in the fair value hierarchy.

The Company records reserves for Stabilizer and MCG contracts containing guaranteed credited rates. The guarantee is treated as an embedded derivative or a stand-alone derivative (depending on the underlying product) and is required to be reported at fair value. The estimated fair value is determined based on the present value of projected future claims, minus the present value of future guaranteed premiums. At inception of the contract, the Company projects a guaranteed premium to be equal to the present value of the projected future claims. The income associated with the contracts is projected using relevant actuarial and capital market assumptions, including benefits and related contract charges, over the anticipated life of the related contracts. The cash flow estimates are produced by using stochastic techniques under a variety of risk neutral scenarios and other market implied assumptions. These derivatives are classified as Level 3 liabilities.

The discount rate used to determine the fair value of the Company's GMWBL, GMWB, FIA, IUL and Stabilizer embedded derivative liabilities and the stand-alone derivative for MCG includes an adjustment to reflect the risk that these obligations will not be fulfilled ("nonperformance risk"). The nonperformance risk adjustment incorporates a blend of observable, similarly

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rated peer holding company credit spreads, adjusted to reflect the credit quality of the individual insurance subsidiary that issued the guarantee, as well as an adjustment to reflect the non-default spreads and the priority and recovery rates of policyholder claims.

Embedded derivatives on reinsurance: The carrying value of embedded derivatives is estimated based upon the change in the fair value of the assets supporting the funds withheld payable under reinsurance agreements. The fair value of the embedded derivative is based on market observable inputs and is classified as Level 2. The remaining derivative instruments are classified as Level 3 and are estimated using the income approach. The fair value is calculated by estimating future cash flows for a certain discrete projection period, estimating the terminal value, if appropriate, and discounting these amounts to present value at a rate of return that considers the relative risk of the cash flows and the time value of money.

Level 3 Financial Instruments

The fair values of certain assets and liabilities are determined using prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement (i.e., Level 3 as defined by ASC Topic 820), including but not limited to liquidity spreads for investments within markets deemed not currently active. These valuations, whether derived internally or obtained from a third-party, use critical assumptions that are not widely available to estimate market participant expectations in valuing the asset or liability. In addition, the Company has determined, for certain financial instruments, an active market is such a significant input to determine fair value that the presence of an inactive market may lead to classification in Level 3. In light of the methodologies employed to obtain the fair values of financial assets and liabilities classified as Level 3, additional information is presented below.

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The following table summarizes the change in fair value of the Company's Level 3 assets and liabilities and transfers in and out of Level 3 for the period indicated:

			Three Months Ended September 30, 2021
			Fair Value as of July 1						Total Realized/Unrealized Gains (Losses) Included in:												Purchases						Issuances						Sales						Settlements						Transfers into Level 3						Transfers out of Level 3						Fair Value as of September 30						Change In Unrealized Gains (Losses) Included in Earnings (3)						Change In Unrealized Gains (Losses) Included in OCI (3)
									Net Income						OCI
Fixed maturities, including securities pledged:
U.S. corporate public securities			$	23					$	—					$	1					$	12					$	—					$	—					$	( 1 )					$	—					$	—					$	35					$	—					$	1
U.S. corporate private securities			2,011						10						( 13 )						127						—						( 22 )						( 142 )						—						( 37 )						1,934						—						( 11 )
Foreign corporate public securities and foreign governments (1)			10						—						—						17						—						—						—						—						( 10 )						17						—						—
Foreign corporate private securities (1)			352						( 15 )						21						29						—						—						( 6 )						—						—						381						1						21
Residential mortgage-backed securities			46						( 4 )						—						16						—						—						—						—						( 2 )						56						( 4 )						( 1 )
Commercial mortgage-backed securities			2						—						—						10						—						—						—						—						—						12						—						—
Other asset-backed securities			78						—						( 1 )						9						—						—						( 22 )						—						( 14 )						50						—						1
Total fixed maturities, including securities pledged			2,522						( 9 )						8						220						—						( 22 )						( 171 )						—						( 63 )						2,485						( 3 )						11
Fixed maturities, trading, at fair value			45						—						—						—						—						—						( 40 )						—						—						5						—						—
Equity securities, at fair value			249						1						—						—						—						—						—						—						—						250						1						—
Derivatives:
Guaranteed benefit derivatives (2)(5)			( 44 )						3						—						—						( 4 )						—						1						—						—						( 44 )						—						—
Other derivatives, net			—						—						—						—						—						—						—						—						—						—						—						—
Embedded derivatives on reinsurance			( 85 )						( 1 )						—						—						—						—						—						—						—						( 86 )						—						—
Assets held in separate accounts (4)			293						1						—						53						—						( 6 )						—						—						( 30 )						311						—						—

(1) Primarily U.S. dollar denominated.

(2) All gains and losses on Level 3 liabilities are classified as realized gains (losses) for the purpose of this disclosure because it is impracticable to track realized and unrealized gains (losses) separately on a contract by contract basis. These amounts are included in Other net realized gains (losses) in the Condensed Consolidated Statements of Operations.

(3) For financial instruments still held as of September 30 amounts are included in Net investment income and Total net realized capital gains (losses) in the Condensed Consolidated Statements of Operations or Unrealized gains (losses) on securities in the Condensed Consolidated Statements of Comprehensive Income.

(4) The investment income and realized gains (losses) and change in unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities, which results in a net zero impact on Net income (loss) for the Company.

(5) Includes GMWBL, GMWB, FIA, Stabilizer and MCGs.

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			Nine Months Ended September 30, 2021
			Fair Value as of January 1						Total Realized/Unrealized Gains (Losses) Included in:												Purchases						Issuances						Sales						Settlements						Transfers into Level 3						Transfers out of Level 3						Fair Value as of September 30						Change In Unrealized Gains (Losses) Included in Earnings (3)						Change In Unrealized Gains (Losses) Included in OCI (3)
									Net Income						OCI
Fixed maturities, including securities pledged:
U.S. corporate public securities			$	93					$	1					$	1					$	12					$	—					$	( 25 )					$	( 1 )					$	—					$	( 46 )					$	35					$	—					$	1
U.S. corporate private securities			1,900						50						( 108 )						210						—						( 340 )						( 198 )						545						( 125 )						1,934						( 1 )						( 107 )
Foreign corporate public securities and foreign governments (1)			—						—						—						17						—						—						—						—						—						17						—						—
Foreign corporate private securities (1)			457						( 6 )						19						30						—						( 81 )						( 38 )						—						—						381						3						16
Residential mortgage-backed securities			43						( 11 )						( 1 )						30						—						( 7 )						—						2						—						56						( 11 )						( 1 )
Commercial mortgage-backed securities			—						—						—						12						—						—						—						—						—						12						—						—
Other asset-backed securities			61						1						( 3 )						19						—						( 5 )						( 45 )						22						—						50						—						( 1 )
Total fixed maturities, including securities pledged			2,554						35						( 92 )						330						—						( 458 )						( 282 )						569						( 171 )						2,485						( 9 )						( 92 )
Fixed maturities, trading, at fair value			—						—						—						45						—						—						( 40 )						—						—						5						—						—
Equity securities, at fair value			172						14						—						225						—						( 152 )						( 9 )						—						—						250						( 1 )						—
Derivatives:
Guaranteed benefit derivatives:
Guaranteed benefit derivatives (2)(5)			( 84 )						41						—						—						( 4 )						—						3						—						—						( 44 )						—						—
Other derivatives, net			1						—						—						—						—						—						( 1 )						—						—						—						( 1 )						—
Embedded derivatives on reinsurance			—						3						—						—						( 89 )						—						—						—						—						( 86 )						—						—
Assets held in separate accounts (4)			222						4						—						157						—						( 7 )						—						—						( 65 )						311						—						—

(1) Primarily U.S. dollar denominated.

(2) All gains and losses on Level 3 liabilities are classified as realized gains (losses) for the purpose of this disclosure because it is impracticable to track realized and unrealized gains (losses) separately on a contract by contract basis. These amounts are included in Other net realized gains (losses) in the Condensed Consolidated Statements of Operations.

(3) For financial instruments still held as of September 30 amounts are included in Net investment income and Total net realized capital gains (losses) in the Condensed Consolidated Statements of Operations or Unrealized gains (losses) on securities in the Condensed Consolidated Statements of Comprehensive Income.

(4) The investment income and realized gains (losses) and change in unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities, which results in a net zero impact on Net income (loss) for the Company.

(5) Includes GMWBL, GMWB, FIA, Stabilizer and MCGs.

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			Three Months Ended September 30, 2020
			Fair Value as of July 1						Total Realized/Unrealized Gains (Losses) Included in:												Purchases						Issuances						Sales						Settlements						Transfers into Level 3						Transfers out of Level 3						Fair Value as of September 30						Change In Unrealized Gains (Losses) Included in Earnings (3)						Change In Unrealized Gains (Losses) Included in OCI (3)
									Net Income						OCI
Fixed maturities, including securities pledged:
U.S. corporate public securities			$	107					$	—					$	4					$	4					$	—					$	—					$	( 2 )					$	42					$	( 37 )					$	118					$	—					$	4
U.S. corporate private securities			1,390						( 1 )						11						47						—						—						( 20 )						406						( 106 )						1,727						( 1 )						11
Foreign corporate public securities and foreign governments (1)			—						—						—						—						—						—						—						—						—						—						—						—
Foreign corporate private securities (1)			305						( 1 )						( 15 )						221						—						( 15 )						( 1 )						17						( 63 )						448						( 2 )						( 15 )
Residential mortgage-backed securities			38						( 2 )						—						2						—						—						—						2						( 5 )						35						( 2 )						—
Commercial mortgage-backed securities			—						—						—						4						—						—						—						—						—						4						—						—
Other asset-backed securities			99						—						—						11						—						—						( 19 )						1						( 17 )						75						—						—
Total fixed maturities, including securities pledged			1,939						( 4 )						—						289						—						( 15 )						( 42 )						468						( 228 )						2,407						( 5 )						—
Equity securities, at fair value			161						7						—						3						—						—						—						—						—						171						7						—
Derivatives:
Guaranteed benefit derivatives (2)(5)			( 210 )						36						—						—						( 4 )						—						1						—						—						( 177 )						—						—
Other derivatives, net			—						—						—						1						—						—						—						—						—						1						1						—
Assets held in separate accounts (4)			174						4						—						43						—						( 1 )						—						—						( 13 )						207						—						—

(1) Primarily U.S. dollar denominated.

(2) All gains and losses on Level 3 liabilities are classified as realized gains (losses) for the purpose of this disclosure because it is impracticable to track realized and unrealized gains (losses) separately on a contract by contract basis. These amounts are included in Other net realized gains (losses) in the Condensed Consolidated Statements of Operations.

(3) For financial instruments still held as of September 30, amounts are included in Net investment income and Total net realized capital gains (losses) in the Condensed Consolidated Statements of Operations or Unrealized gains (losses) on securities in the Condensed Consolidated Statements of Comprehensive Income.

(4) The investment income and realized gains (losses) and change in unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities, which results in a net zero impact on Net income (loss) for the Company.

(5) Includes GMWBL, GMWB, FIA, Stabilizer and MCG.

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For the three and nine months ended September 30, 2021 and 2020, the transfers in and out of Level 3 for fixed maturities were due to the variation in inputs relied upon for valuation each quarter. Securities that are primarily valued using independent broker quotes when prices are not available from one of the commercial pricing services are reflected as transfers into Level 3. When securities are valued using more widely available information, the securities are transferred out of Level 3 and into Level 1 or 2, as appropriate.

Significant Unobservable Inputs

The Company's Level 3 fair value measurements of its fixed maturities, equity securities and equity and credit derivative contracts are primarily based on broker quotes for which the quantitative detail of the unobservable inputs is neither provided nor reasonably corroborated, thus negating the ability to perform a sensitivity analysis. The Company performs a review of broker quotes by performing a monthly price variance comparison and back tests broker quotes to recent trade prices.

Other Financial Instruments

The following disclosures are made in accordance with the requirements of ASC Topic 825 which requires disclosure of fair value information about financial instruments, whether or not recognized at fair value on the Consolidated Balance Sheets.

ASC Topic 825 excludes certain financial instruments, including insurance contracts and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company.

The carrying values and estimated fair values of the Company's financial instruments as of the dates indicated:

			September 30, 2021												December 31, 2020
			Carrying Value						Fair Value						Carrying Value						Fair Value
Assets:
Fixed maturities, including securities pledged			$	38,173					$	38,173					$	47,029					$	47,029
Equity securities			288						288						242						242
Mortgage loans on real estate			5,598						6,008						6,830						7,316
Policy loans			402						402						718						718
Cash, cash equivalents, short-term investments and short-term investments under securities loan agreements			2,975						2,975						2,012						2,012
Derivatives			139						139						215						215
Deposit assets (3)			1,553						1,609						—						—
Other investments			75						75						285						368
Assets held in separate accounts			96,794						96,794						90,552						90,552
Liabilities:
Investment contract liabilities:
Funding agreements without fixed maturities and deferred annuities (1)			$	35,519					$	44,164					$	35,545					$	45,576
Funding agreements with fixed maturities			1,329						1,326						796						795
Supplementary contracts, immediate annuities and other			853						797						912						800
Derivatives:
Guaranteed benefit derivatives (2)			44						44						99						99
Other derivatives			271						271						387						387
Short-term debt			1						1						1						1
Long-term debt			2,970						3,435						3,044						3,564
Embedded derivative on reinsurance			231						231						163						163

(1) Certain amounts included in Funding agreements without fixed maturities and deferred annuities are also reflected within the Guaranteed benefit derivatives section of the table above.

(2) Includes GMWBL, GMWB, FIA, Stabilizer and MCG.

(3) Included in Other assets on the Condensed Consolidated Balance Sheets.

The following table presents the classifications of financial instruments which are not carried at fair value on the Condensed Consolidated Balance Sheets:

Financial Instrument			Classification
Mortgage loans on real estate			Level 3
Policy loans			Level 2
Deposit assets			Level 3
Other investments			Level 2
Funding agreements without fixed maturities and deferred annuities			Level 3
Funding agreements with fixed maturities			Level 2
Supplementary contracts and immediate annuities			Level 3
Short-term debt and Long-term debt			Level 2

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The following tables present a rollforward of DAC and VOBA for the periods indicated:

			2021
			DAC						VOBA						Total
Balance as of January 1, 2021			$	1,440					$	70					$	1,510
Impact of ASU 2016-13			—						—						—
Deferrals of commissions and expenses			73						5						78
Amortization:
Amortization, excluding unlocking (2)			( 590 )						( 265 )						( 855 )
Unlocking (1)			( 21 )						13						( 8 )
Interest accrued			81						27			(3)			108
Net amortization included in Condensed Consolidated Statements of Operations			( 530 )						( 225 )						( 755 )
Change due to unrealized capital gains/(losses) on available-for-sale securities			211						293						504
Balance as of September 30, 2021			$	1,194					$	143					$	1,337
			2020
			DAC						VOBA						Total
Balance as of January 1, 2020			$	1,762					$	464					$	2,226
Impact of ASU 2016-13			3						—						3
Deferrals of commissions and expenses			77						4						81
Amortization:
Amortization, excluding unlocking			( 205 )						( 82 )						( 287 )
Unlocking (1)			( 41 )						( 136 )						( 177 )
Interest accrued			91						37			(3)			128
Net amortization included in Condensed Consolidated Statements of Operations			( 155 )						( 181 )						( 336 )
Change due to unrealized capital gains/(losses) on available-for-sale securities			( 235 )						( 171 )						( 406 )
Balance as of September 30, 2020			$	1,452					$	116					$	1,568

(1) Includes the impacts of annual review of assumptions which typically occurs in the third quarter; and retrospective and prospective unlocking.

(2) During 2021, the Company recognized loss recognition of $ 351 and $ 87 for DAC and VOBA, respectively. There was no loss recognition during 2020.

(3) Interest accrued at the following rates for VOBA: 3.5 % to 7.2 % during 2021 and 3.5 % and 7.2 % during 2020.

The Company has provided equity-based compensation awards to its employees under the ING U.S., Inc. 2013 Omnibus Employee Incentive Plan (the "2013 Omnibus Plan"), the Voya Financial, Inc. 2014 Omnibus Employee Incentive Plan (the "2014 Omnibus Plan") and the Voya Financial, Inc. 2019 Omnibus Employee Incentive Plan (the "2019 Omnibus Plan") (together, the "Omnibus Plans"). As of September 30, 2021, common stock reserved and available for issuance under the 2013 Omnibus Plan, the 2014 Omnibus Plan and the 2019 Omnibus Plan was 347,663 , 3,194,452 and 9,234,600 shares, respectively.

The Company offers equity-based awards to Voya Financial, Inc. non-employee directors under the Voya Financial, Inc. 2013 Omnibus Non-Employee Director Incentive Plan ("Director Plan").

Compensation Cost

The following table summarizes share-based compensation expense, which includes expenses related to awards granted under the Omnibus Plans and Director Plan for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Restricted Stock Unit (RSU) awards			$	8					$	9					$	34					$	36
Performance Stock Unit (PSU) awards			10						7						40						32
Stock options			—						1						1						4
Total share-based compensation expense			18						17						75						72
Income tax benefit			4						3						19						26
After-tax share-based compensation expense			$	14					$	14					$	56					$	46

Awards Outstanding

The following table summarizes RSU and PSU awards activity under the Omnibus Plans and the Director Plan for the periods indicated:

			RSU Awards																		PSU Awards
(awards in millions)			Number of Awards						Weighted Average Grant Date Fair Value																		Number of Awards						Weighted Average Grant Date Fair Value
Outstanding as of January 1, 2021			1.5						$	55.86																	2.0						$	55.48
Adjustment for PSU performance factor			—						—																		0.3						53.22
Granted			0.8						56.79																		0.8						49.88
Vested			( 0.8 )						52.83																		( 1.0 )						53.30
Forfeited			( 0.1 )						58.25																		( 0.1 )						55.78
Outstanding as of September 30, 2021			1.4						$	57.48																	2.0						$	54.06

The following table summarizes the number of options under the Omnibus Plans for the periods indicated:

			Stock Options
(awards in millions)			Number of Awards						Weighted Average Exercise Price
Outstanding as of January 1, 2021			2.6						$	42.29
Granted			—						—
Exercised			( 0.4 )						39.53
Forfeited			( 0.2 )						42.06
Outstanding as of September 30, 2021			2.0						$	42.84
Vested, exercisable, as of September 30, 2021			2.0						$	42.84

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Non-controlling Interest

Non-controlling interest in limited partnerships increased as a result of favorable market appreciation in limited partnership investments, net of contributions and distributions. See the Consolidated and Nonconsolidated Investment Entities Note to these Condensed Consolidated Financial Statements for additional details over changes in non-controlling interest during the year and impacting Shareholders' Equity.

Common Shares

The following table presents the rollforward of common shares used in calculating the weighted average shares utilized in the basic earnings per common share calculation for the periods indicated:

			Common Shares
(shares in millions)			Issued						Held in Treasury						Outstanding
Balance, January 1, 2020			140.7						8.4						132.3
Common shares issued			0.1						—						0.1
Common shares acquired - share repurchase			—						10.2						( 10.2 )
Share-based compensation			2.5						0.5						2.0
Balance, December 31, 2020			143.3						19.1						124.2
Common shares issued			0.1						—						0.1
Common shares acquired - share repurchase			—						13.2						( 13.2 )
Share-based compensation			2.2						0.9						1.3
Balance, September 30, 2021			145.6						33.2						112.4

Dividends declared per share of Common Stock were as follows for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Dividends declared per share of Common Stock			$	0.165					$	0.15					$	0.495					$	0.45

Share Repurchase Program

From time to time, the Company's Board of Directors authorizes the Company to repurchase shares of its common stock. These authorizations permit stock repurchases up to a prescribed dollar amount and generally may be accomplished through various means, including, without limitation, open market transactions, privately negotiated transactions, forward, derivative, or accelerated repurchase, or automatic repurchase transactions, including 10b5-1 plans, or tender offers. Share repurchase authorizations typically expire if unused by a prescribed date.

On October 28, 2021, the Board of Directors provided its most recent share repurchase authorization, increasing the aggregate amount of the Company's common stock authorized for repurchase by $ 500 . On January 28, 2021, the Board of Directors provided share repurchase authorization, increasing the aggregate amount of the Company's common stock authorized for repurchase by $ 1 billion. The share repurchase authorization expires on December 31, 2022 (unless extended), and does not obligate the Company to purchase any shares. The authorization for the share repurchase program may be terminated, increased or decreased by the Board of Directors at any time.

The following table presents repurchases of the Company's common stock through share repurchase agreements with third-party financial institutions during the nine months ended September 30, 2021:

Execution Date						Payment						Initial Shares Delivered						Closing Date						Additional Shares Delivered						Total Shares Repurchased
June 30, 2021						$	400					5,203,252						September 16, 2021						1,081,552						6,284,804
February 11, 2021						$	250					3,617,291						May 14, 2021						330,852						3,948,143
December 28, 2020						$	150					2,066,472						January 26, 2021						509,909						2,576,381

Subsequent to September 30, 2021, the Company repurchased 1,835,531 shares through a 10b5-1 plan for an aggregate purchase price of $ 124 .

Warrants

On May 7, 2013, the Company issued to ING Group warrants to purchase up to 26,050,846 shares of the Company's common stock equal in the aggregate to 9.99 % of the issued and outstanding shares of common stock at that date. The exercise price of the warrants at the time of issuance was $ 48.75 per share of common stock, subject to adjustments, including for stock dividends, cash dividends in excess of $ 0.01 per share a quarter, subdivisions, combinations, reclassifications and non-cash distributions. The warrants also provide for, upon the occurrence of certain change of control events affecting the Company, an increase in the number of shares to which a warrant holder will be entitled upon payment of the aggregate exercise price of the warrant. The warrants became exercisable to ING Group and its affiliates on January 1, 2017 and to all other holders starting on the first anniversary of the completion of the IPO (May 7, 2014). The warrants expire on the tenth anniversary of the completion of the IPO (May 7, 2023). The warrants are net share settled, which means that no cash will be payable by a warrant holder in respect of the exercise price of a warrant upon exercise, and are classified as permanent equity. They have been recorded at their fair value determined on the issuance date of May 7, 2013 in the amount of $ 94 as an addition and reduction to Additional-paid-in-capital. Warrant holders are not entitled to receive dividends. On March 12, 2018, ING Group sold its remaining interests in the warrants and no longer owns any warrants. On September 29, 2021, the Company paid a quarterly dividend of $ 0.165 per share on its common stock. As a consequence, the exercise price of the warrants to purchase shares of common stock was adjusted to $ 47.62 per share of common stock and the number of shares of common stock for which each warrant is exercisable has been adjusted to 1.002359604 . As of September 30, 2021, no warrants have been exercised.

Preferred Stock

As of September 30, 2021 and December 31, 2020, there were 100,000,000 shares of preferred stock authorized. Preferred stock issued and outstanding are as follows:

									September 30, 2021															December 31, 2020
Series									Issued						Outstanding									Issued						Outstanding
6.125 % Non-cumulative Preferred Stock, Series A									325,000						325,000									325,000						325,000
5.35 % Non-cumulative Preferred Stock, Series B									300,000						300,000									300,000						300,000
Total									625,000						625,000									625,000						625,000

The declaration of dividends on preferred stock per share and in the aggregate were as follows for the periods indicated:

						Series A												Series B
Three Months Ended September 30,						Per Share						Aggregate						Per Share						Aggregate
2021						$	30.625					$	10					$	13.375					$	4
2020						30.625						10						13.375						4
Nine Months Ended September 30,
2021						$	61.25					$	20					$	40.125					$	12
2020						61.25						20						40.125						12

As of September 30, 2021, there were no preferred stock dividends in arrears.

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The following table presents a reconciliation of Net income (loss) and shares used in calculating basic and diluted net income (loss) per common share for the periods indicated:

			Three Months Ended September 30,						Nine Months Ended September 30,
(in millions, except for per share data)			2021			2020			2021			2020
Earnings
Net income (loss) available to common shareholders:
Income (loss) from continuing operations			$	371		$	( 73 )		$	2,373		$	( 71 )
Less: Preferred stock dividends			14			14			32			32
Less: Net income (loss) attributable to noncontrolling interest			214			106			661			33
Income (loss) from continuing operations available to common shareholders			143			( 193 )			1,680			( 136 )
Income (loss) from discontinued operations, net of tax			( 1 )			( 140 )			7			( 363 )
Net income (loss) available to common shareholders			$	142		$	( 333 )		$	1,687		$	( 499 )
Weighted average common shares outstanding
Basic			113.4			126.3			118.8			127.8
Dilutive Effects (1)(2) :
Warrants			6.7			—			6.5			—
RSU awards			1.0			—			1.0			—
PSU awards			0.7			—			0.8			—
Stock Options			0.6			—			0.7			—
Diluted			122.4			126.3			127.8			127.8
Basic (3)
Income (loss) from continuing operations available to Voya Financial, Inc.'s common shareholders			$	1.25		$	( 1.53 )		$	14.13		$	( 1.07 )
Income (loss) from discontinued operations, net of taxes available to Voya Financial, Inc.'s common shareholders			$	( 0.01 )		$	( 1.11 )		$	0.06		$	( 2.83 )
Income (loss) available to Voya Financial, Inc.'s common shareholders			$	1.24		$	( 2.64 )		$	14.19		$	( 3.90 )
Diluted (3)
Income (loss) from continuing operations available to Voya Financial, Inc.'s common shareholders			$	1.16		$	( 1.53 )		$	13.14		$	( 1.07 )
Income (loss) from discontinued operations, net of taxes available to Voya Financial, Inc.'s common shareholders			$	( 0.01 )		$	( 1.11 )		$	0.05		$	( 2.83 )
Income (loss) available to Voya Financial, Inc.'s common shareholders			$	1.15		$	( 2.64 )		$	13.19		$	( 3.90 )

(1) For the three months ended September 30, 2020, weighted average shares used for calculating basic and diluted earnings per share are the same, as the inclusion of 0.6 shares, 0.9 shares, 1.3 shares, and 0.4 shares for warrants, RSU awards, PSU awards, and stock options, respectively, would be antidilutive to the earnings per share calculation due to the net loss from continuing operations available to common shareholders in the period.

(2) For the nine months ended September 30, 2020, weighted average shares used for calculating basic and diluted earnings per share are the same, as the inclusion of 1.2 shares, 0.9 shares, 1.3 shares, and 0.4 shares for warrants, RSU awards, PSU awards, and stock options, respectively, would be antidilutive to the earnings per share calculation due to the net loss from continuing operations available to common shareholders in the period.

(3) Basic and diluted earnings per share are calculated using unrounded, actual amounts. Therefore, the components of earnings per share may not sum to its corresponding total.

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Shareholders' equity included the following components of Accumulated Other Comprehensive Income ("AOCI") as of the dates indicated:

			September 30,
			2021						2020
Fixed maturities, net of impairment			$	3,521					$	7,704
Derivatives (1)			82						144
DAC/VOBA adjustment on available-for-sale securities			( 821 )						( 1,938 )
Premium deficiency reserve adjustment			( 15 )						( 439 )
Sales inducements and other intangibles adjustment on available-for-sale securities			5						( 353 )
Unrealized capital gains (losses), before tax			2,772						5,118
Deferred income tax asset (liability)			( 459 )						( 720 )
Net unrealized capital gains (losses)			2,313						4,398
Pension and other postretirement benefits liability, net of tax			3						5
AOCI			$	2,316					$	4,403

(1) Gains and losses reported in Accumulated Other Comprehensive Income (AOCI) from hedge transactions that resulted in the acquisition of an identified asset are reclassified into earnings in the same period or periods during which the asset acquired affects earnings. As of September 30, 2021, the portion of the AOCI that is expected to be reclassified into earnings within the next 12 months is $ 20 .

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Changes in AOCI, including the reclassification adjustments recognized in the Condensed Consolidated Statements of Operations were as follows for the periods indicated:

			Three Months Ended September 30, 2021
			Before-Tax Amount						Income Tax						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	( 196 )					$	41					$	( 155 )
Other			( 2 )						—						( 2 )
Adjustments for amounts recognized in Net realized capital gains (losses) in the Condensed Consolidated Statements of Operations			( 22 )						4						( 18 )
DAC/VOBA			56						( 12 )						44
Premium deficiency reserve adjustment			—						—						—
Sales inducements and other intangibles			1						—						1
Change in unrealized gains (losses) on available-for-sale securities			( 163 )						33						( 130 )
Derivatives:
Derivatives			23			(1)			( 4 )						19
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations			( 5 )						1						( 4 )
Change in unrealized gains (losses) on derivatives			18						( 3 )						15
Pension and other postretirement benefits liability:
Amortization of prior service cost recognized in Operating expenses in the Condensed Consolidated Statements of Operations			—						—						—
Change in pension and other postretirement benefits liability			—						—						—
Change in Accumulated other comprehensive income (loss)			$	( 145 )					$	30					$	( 115 )

(1) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information.

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			Nine Months Ended September 30, 2021
			Before-Tax Amount						Income Tax						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	( 3,295 )					$	461					$	( 2,834 )
Other			( 2 )						—						( 2 )
Adjustments for amounts recognized in Net realized capital gains (losses) in the Condensed Consolidated Statements of Operations			( 1,797 )						377						( 1,420 )
DAC/VOBA			1,250			(1)			( 263 )						987
Premium deficiency reserve adjustment			445						( 93 )						352
Sales inducements and other intangibles			420						( 88 )						332
Change in unrealized gains (losses) on available-for-sale securities			( 2,979 )						394						( 2,585 )
Derivatives:
Derivatives			21			(2)			( 4 )						17
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations			( 16 )						3						( 13 )
Change in unrealized gains (losses) on derivatives			5						( 1 )						4
Pension and other postretirement benefits liability:
Amortization of prior service cost recognized in Operating expenses in the Condensed Consolidated Statements of Operations			( 1 )						—						( 1 )
Change in pension and other postretirement benefits liability			( 1 )						—						( 1 )
Change in Accumulated other comprehensive income (loss)			$	( 2,975 )					$	393					$	( 2,582 )

(1) See the Deferred Policy Acquisition Costs and Value of Business Acquired Note to these Condensed Consolidated Financial Statements for additional information.

(2) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information.

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			Three Months Ended September 30, 2020
			Before-Tax Amount						Income Tax						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	783					$	( 163 )					$	620
Other			( 1 )						—						( 1 )
Adjustments for amounts recognized in Net realized capital gains (losses) in the Condensed Consolidated Statements of Operations			7						( 1 )						6
DAC/VOBA			( 23 )						4						( 19 )
Premium deficiency reserve adjustment			( 114 )						24						( 90 )
Sales inducements and other intangibles			( 140 )						29						( 111 )
Change in unrealized gains (losses) on available-for-sale securities			512						( 107 )						405
Derivatives:
Derivatives			( 45 )			(1)			9						( 36 )
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations			( 6 )						1						( 5 )
Change in unrealized gains (losses) on derivatives			( 51 )						10						( 41 )
Pension and other postretirement benefits liability:
Amortization of prior service cost recognized in Operating expenses in the Condensed Consolidated Statements of Operations			—						—						—
Change in pension and other postretirement benefits liability			—						—						—
Change in Accumulated other comprehensive income (loss)			$	461					$	( 97 )					$	364

(1) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information    .

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			Nine Months Ended September 30, 2020
			Before-Tax Amount						Income Tax						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	2,114					$	( 443 )					$	1,671
Other			( 1 )						—						( 1 )
Adjustments for amounts recognized in Net realized capital gains (losses) in the Condensed Consolidated Statements of Operations			44						( 9 )						35
DAC/VOBA			( 440 )			(1)			92						( 348 )
Premium deficiency reserve adjustment			( 189 )						40						( 149 )
Sales inducements and other intangibles			( 168 )						35						( 133 )
Change in unrealized gains (losses) on available-for-sale securities			1,360						( 285 )						1,075
Derivatives:
Derivatives			17			(2)			( 4 )						13
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations			( 18 )						4						( 14 )
Change in unrealized gains (losses) on derivatives			( 1 )						—						( 1 )
Pension and other postretirement benefits liability:
Amortization of prior service cost recognized in Operating expenses in the Condensed Consolidated Statements of Operations			( 2 )						—						( 2 )
Change in pension and other postretirement benefits liability			( 2 )						—						( 2 )
Change in Accumulated other comprehensive income (loss)			$	1,357					$	( 285 )					$	1,072

(1) See the Deferred Policy Acquisition Costs and Value of Business Acquired Note to these Condensed Consolidated Financial Statements for additional information.

(2) See the Derivative Financial Instruments Note to these Condensed Consolidated Financial Statements for additional information.

The Company uses the estimated annual effective tax rate method in computing its interim tax provision. Certain items, including changes in the realizability of deferred tax assets and changes in liabilities for uncertain tax positions, are excluded from the estimated annual effective tax rate and the actual tax expense or benefit is reported in the period the related item is incurred.

The Company's effective tax rate for the three months ended September 30, 2021 was 9.7 % . The effective tax rate differed from the statutory rate of 21 % primarily due to noncontrolling interest.

The Company's effective tax rate for the nine months ended September 30, 2021 was 4.2 %. The effective tax rate differed from the statutory rate of 21 % primarily due to the effect of the release of a stranded tax benefit in Other Comprehensive Income due to the Individual Life Transaction, noncontrolling interest and the effect of the dividends received deduction ("DRD").

The Company's effective tax rate for the three and nine months ended September 30, 2020 was 49.7 % and 50.3 %. The effective

tax rate differed from the statutory rate of 21% primarily due the effect of the DRD, tax credits and non-controlling interest.

Tax Regulatory Matters

For the tax years 2019 through 2021, the Company participated in the Internal Revenue Service ("IRS") Compliance Assurance Process ("CAP"), which is a continuous audit program provided by the IRS. For the 2019 and 2020 tax years, the Company was in the Compliance Maintenance Bridge ("Bridge") phase of CAP. In the Bridge phase, the IRS did not conduct any review or provide any letters of assurance for those tax years.

Short-term and Long-term Debt

The following table summarizes the carrying value of the Company’s debt securities issued and outstanding as of September 30, 2021 and December 31, 2020:

			Issuer						Maturity						September 30, 2021						December 31, 2020
3.125 % Senior Notes, due 2024 (2)(3)			Voya Financial, Inc.						07/15/2024						$	375					$	398
3.65 % Senior Notes, due 2026 (2)(3)			Voya Financial, Inc.						06/15/2026						444						497
5.7 % Senior Notes, due 2043 (2)(3)			Voya Financial, Inc.						07/15/2043						395						395
4.8 % Senior Notes, due 2046 (2)(3)			Voya Financial, Inc.						06/15/2046						297						297
4.7 % Fixed-to-Floating Rate Junior Subordinated Notes, due 2048			Voya Financial, Inc.						01/23/2048						345						345
5.65 % Fixed-to-Floating Rate Junior Subordinated Notes, due 2053			Voya Financial, Inc.						05/15/2053						740						739
7.25 % Voya Holdings Inc. debentures, due 2023 (1)			Voya Holdings, Inc.						08/15/2023						140						139
7.63 % Voya Holdings Inc. debentures, due 2026 (1)			Voya Holdings, Inc.						08/15/2026						139						138
6.97 % Voya Holdings Inc. debentures, due 2036 (1)			Voya Holdings, Inc.						08/15/2036						79						79
8.42 % Equitable of Iowa Companies Capital Trust II Notes, due 2027			Equitable of Iowa Capital Trust II						04/01/2027						13						14
1.00 % Windsor Property Loan			Voya Retirement Insurance and Annuity Company						06/14/2027						4						4
Subtotal															2,971						3,045
Less: Current portion of long-term debt															1						1
Total															$	2,970					$	3,044

(1) Guaranteed by ING Group.

(2) Interest is paid semi-annually in arrears.

(3) Guaranteed by Voya Holdings.

As of September 30, 2021, the Company was in compliance with its debt covenants.

Aetna Notes

As of September 30, 2021, the outstanding principal amount of the Aetna Notes was $ 358 , which is guaranteed by ING Group. As of September 30, 2021, the Company provided $ 362 of collateral benefiting ING Group, comprised of a deposit of $ 199 to a control account with a third-party collateral agent and $ 163 of letter of credit. The collateral may be exchanged at any time upon the posting of any other form of acceptable collateral to the account.

Senior Notes

During the nine months ended September 30, 2021, the Company repurchased $ 23 and $ 53 par value of its 3.125 % Senior Notes, due 2024 and 3.65 % Senior Notes, due 2026, respectively, for $ 25 and $ 60 , respectively, on the open market, resulting

in loss on debt extinguishment of $ 10 , which is included in Interest expense on the Condensed Consolidated Statements of Operations.

On October 29, 2021, the Company delivered to the holders of its 3.125 % Senior Notes due 2024 (the “2024 Notes”) a notice of redemption, notifying those noteholders that the Company has elected to redeem all of the outstanding $ 377 aggregate principal amount of the 2024 Notes. The Company expects to incur a loss on debt extinguishment of approximately $ 25 in the fourth quarter of 2021, which will be recorded in Interest Expense in the Consolidated Statements of Operations.

Senior Unsecured Credit Facility Agreement

As of September 30, 2021, the Company had a $ 500 senior unsecured credit facility with a syndicate of banks which expires November 1, 2024. The facility provides $ 500 of committed capacity for issuing letters of credit and the full $ 500 may be utilized for direct borrowings. As of September 30, 2021, there were no amounts outstanding as revolving credit borrowings and no amounts of LOCs outstanding under the senior unsecured credit facility. Under the terms of the facility, the Company is required to maintain a minimum net worth of $ 6.15 billion, which may increase upon any future equity issuances by the Company.

Leases

During the three and nine months ended September 30, 2021, the Company recorded an impairment of $ 3 and $ 16 respectively, on its right-of-use asset associated with leased office space, which is included in Operating expenses in the Condensed Consolidated Statements of Operations.

Commitments

Through the normal course of investment operations, the Company commits to either purchase or sell securities, mortgage loans, or money market instruments, at a specified future date and at a specified price or yield. The inability of counterparties to honor these commitments may result in either a higher or lower replacement cost. Also, there is likely to be a change in the value of the securities underlying the commitments.

As of September 30, 2021, the Company had off-balance sheet commitments to acquire mortgage loans of $ 127 and purchase limited partnerships and private placement investments of $ 961 , of which $ 319 related to consolidated investment entities.

Restricted Assets

The Company is required to maintain assets on deposit with various regulatory authorities to support its insurance operations. The Company may also post collateral in connection with certain securities lending, repurchase agreements, funding agreements, credit facilities and derivative transactions. The components of the fair value of the restricted assets were as follows as of the dates indicated:

			September 30, 2021						December 31, 2020
Fixed maturity collateral pledged to FHLB (1)			$	1,785					$	1,386
FHLB restricted stock (2)			74						54
Other fixed maturities-state deposits			47						47
Cash and cash equivalents			38						15
Securities pledged (3)			1,320						449
Total restricted assets			$	3,264					$	1,951

(1) Included in Fixed maturities, available for sale, at fair value on the Condensed Consolidated Balance Sheets.

(2) Included in Other investments on the Condensed Consolidated Balance Sheets.

(3) Includes the fair value of loaned securities of $ 989 and $ 197 as of September 30, 2021 and December 31, 2020, respectively. In addition, as of September 30, 2021 and December 31, 2020, the Company delivered securities as collateral of $ 206 and $ 170 and repurchase agreements of $ 125 and $ 82 , respectively. Loaned securities and securities delivered as collateral are included in Securities pledged on the Condensed Consolidated Balance Sheets.

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Federal Home Loan Bank Funding Agreements

The Company is a member of the FHLB of Des Moines and the FHLB of Boston and is required to pledge collateral to back funding agreements issued to the FHLB. As of September 30, 2021 and December 31, 2020, the Company had $ 1,326 and $ 795 , respectively, in non-putable funding agreements, which are included in Contract owner account balances on the Condensed Consolidated Balance Sheets. As of September 30, 2021 and December 31, 2020, assets with a market value of approximately $ 1,785 and $ 1,386 , respectively, collateralized the FHLB funding agreements. Assets pledged to the FHLB are included in Fixed maturities, available-for-sale, at fair value on the Condensed Consolidated Balance Sheets.

Subsequent to September 30, 2021. the Company issued an additional $ 145 of funding agreements to the FHLB and pledged additional assets of $ 100 in support of these contracts.

Litigation, Regulatory Matters and Contingencies

Litigation, regulatory and other loss contingencies arise in connection with the Company's activities as a diversified financial services firm. The Company is a defendant in a number of litigation matters arising from the conduct of its business, both in the ordinary course and otherwise. In some of these matters, claimants seek to recover very large or indeterminate amounts, including compensatory, punitive, treble and exemplary damages. Modern pleading practice in the U.S. permits considerable variation in the assertion of monetary damages and other relief. Claimants are not always required to specify the monetary damages they seek or they may be required only to state an amount sufficient to meet a court's jurisdictional requirements. Moreover, some jurisdictions allow claimants to allege monetary damages that far exceed any reasonably possible verdict. The variability in pleading requirements and past experience demonstrates that the monetary and other relief that may be requested in a lawsuit or claim often bears little relevance to the merits or potential value of a claim. Litigation against the Company includes a variety of claims including negligence, breach of contract, fraud, violation of regulation or statute, breach of fiduciary duty, negligent misrepresentation, failure to supervise, elder abuse and other torts.

As with other financial services companies, the Company periodically receives informal and formal requests for information from various state and federal governmental agencies and self-regulatory organizations in connection with inquiries and investigations of the products and practices of the Company or the financial services industry. It is the practice of the Company to cooperate fully in these matters.

While it is possible that an adverse outcome in certain cases could have a material adverse effect upon the Company's financial position, based on information currently known, management believes that neither the outcome of pending litigation and regulatory matters nor potential liabilities associated with other loss contingencies, are likely to have such an effect. However, given the large and indeterminate amounts sought in certain litigation and the inherent unpredictability of all such matters, it is possible that an adverse outcome in certain of the Company's litigation or regulatory matters, or liabilities arising from other loss contingencies, could, from time to time, have a material adverse effect upon the Company's results of operations or cash flows in a particular quarterly or annual period.

For some matters, the Company is able to estimate a possible range of loss. For such matters in which a loss is probable, an accrual has been made. For matters where the Company, however, believes a loss is reasonably possible, but not probable, no accrual is required. For matters for which an accrual has been made, but there remains a reasonably possible range of loss in excess of the amounts accrued or for matters where no accrual is required, the Company develops an estimate of the unaccrued amounts of the reasonably possible range of losses. As of September 30, 2021, the Company estimates the aggregate range of reasonably possible losses, in excess of any amounts accrued for these matters as of such date, to be up to approximately $ 25 .

For other matters, the Company is currently not able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from plaintiffs and other parties, investigation of factual allegations, rulings by a court on motions or appeals, analysis by experts and the progress of settlement discussions. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation and regulatory contingencies and updates the Company's accruals, disclosures and reasonably possible losses or ranges of loss based on such reviews.

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Litigation includes Henkel of America v. ReliaStar Life Insurance Company, et al. (USDC District of Connecticut, No. 1:18-cv-00965) (filed June 8, 2018). Plaintiff alleges that ReliaStar breached the terms of a stop loss policy it issued to Plaintiff by refusing to reimburse Plaintiff for more than $ 47 in claims incurred by participants in prior years and submitted for coverage under the stop loss policy. Plaintiff alleges a breach of contract claim or, in the alternative, that the stop loss policy be declared to cover the submitted claims, and also asserts that ReliaStar engaged in unfair trade practices and unfair insurance practices in violation of state statutes, and did so willfully and intentionally to warrant an award of punitive damages under state law. On July 8, 2021, the district court denied defendant Express Scripts’ motion for summary judgement. The Company denies the allegations, which it believes are without merit, and intends to defend the case vigorously.

Finally, industry wide, life insurers continue to be exposed to class action litigation related to the cost of insurance rates and periodic deductions from cash value. Common allegations include that insurance companies have breached the terms of their universal life insurance policies by establishing or increasing the cost of insurance rates using cost factors not permitted by the contract, thereby unjustly enriching themselves. This litigation is generally known as cost of insurance litigation.

Cost of insurance litigation for the Company includes Advance Trust & Life Escrow Services, LTA v. ReliaStar Life Insurance Company (USDC District of Minnesota, No. 1:18-cv-02863) (filed October 5, 2018), a putative class action in which Plaintiff alleges that the Company’s universal life insurance policies only permitted the Company to rely upon the policyholders’ expected future mortality experience to establish the cost of insurance, and that as projected mortality experience improved, the policy language required the Company to decrease the cost of insurance. Plaintiff alleges that the Company did not decrease the cost of insurance as required, thereby breaching its contract with the policyholders, and seeks class certification. The Company denies the allegations in the complaint, believes the complaint to be without merit, and will defend the lawsuit vigorously.

Contingencies related to Performance-based Capital Allocations on Private Equity Funds

Certain performance-based capital allocations related to sponsored private equity funds ("carried interest") are not final until the conclusion of an investment term specified in the relevant asset management contract. As a result, such carried interest, if accrued or paid to the Company during such term, is subject to later adjustment based on subsequent fund performance. If the fund’s cumulative investment return falls below specified investment return hurdles, some or all of the previously accrued carried interest is reversed to the extent that the Company is no longer entitled to the performance-based capital allocation. Should the fund’s cumulative investment return subsequently increase above specified investment return hurdles in future periods, previous reversals could be fully or partially recovered.

As of September 30, 2021, approximately $ 124 of previously accrued carried interest would be subject to full or partial reversal in future periods if cumulative fund performance hurdles are not maintained throughout the remaining life of the affected funds.

The Company holds variable interests in certain investment entities in the form of debt or equity investments, as well as the right to receive management fees, performance fees, and carried interest. The Company consolidates certain entities under the VIE guidance when it is determined that the Company is the primary beneficiary. Alternatively, certain entities are consolidated under the VOE guidance when control is obtained through voting rights. Refer to the Condensed Consolidated Balance Sheets for the assets and liabilities of the Company's consolidated investment entities.

The Company has no right to the benefits from, nor does it bear the risks associated with consolidated investment entities beyond the Company’s direct equity and debt investments in and management fees generated from these entities. Such direct investments amounted to approximately $ 314 and $ 233 as of September 30, 2021 and December 31, 2020, respectively. If the Company were to liquidate, the assets held by consolidated investment entities would not be available to the general creditors of the Company as a result of the liquidation.

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Consolidated VIEs and VOEs

Collateral Loan Obligations Entities ("CLOs")

The Company is involved in the design, creation, and the ongoing management of CLOs. These entities are created for the purpose of acquiring diversified portfolios of senior secured floating rate leveraged loans, and securitizing these assets by issuing multiple tranches of collateralized debt; thereby providing investors with a broad array of risk and return profiles. Also known as collateralized financing entities under Topic 810, CLOs are variable interest entities by definition.

In return for providing collateral management services, the Company earns investment management fees and contingent performance fees. In addition to earning fee income, the Company often holds an investment in certain of the CLOs it manages, generally within the unrated and most subordinated tranche of each CLO. The fee income earned and investments held are included in the Company's ongoing consolidation assessment for each CLO. The Company was the primary beneficiary of 5 and 3 CLOs as of September 30, 2021 and December 31, 2020, respectively.

Limited Partnerships ("LPs")

The Company invests in and manages various limited partnerships, including private equity funds and hedge funds. These entities have been evaluated by the Company and are determined to be VIEs due to the equity holders, as a group, lacking the characteristics of a controlling financial interest.

In return for serving as the general partner of and providing investment management services to these entities, the Company earns management fees and carried interest in the normal course of business. Additionally, the Company often holds an investment in each limited partnership it manages, generally in the form of general partner and limited partner interests. The fee income, carried interest, and investments held are included in the Company’s ongoing consolidation analysis for each limited partnership. The Company consolidated 13 and 12 funds, which were structured as partnerships, as of September 30, 2021 and December 31, 2020, respectively.

The non-controlling interest related to these partnerships increased from $ 1,068 at December 31, 2020 to $ 1,606 at September 30, 2021. Changes in market value of these investments in partnerships directly impacts the non-controlling interest component of Shareholders' Equity on the Company's Condensed Consolidated Balance Sheets. The change in non-controlling interest was primarily driven by favorable market appreciation, adjusted for contributions and distributions. The Company records the non-controlling interest using a lag methodology relying on the most recent financial information available.

Registered Investment Companies

The Company did not consolidate any sponsored investment funds accounted for as VOEs as of September 30, 2021. The Company deconsolidated one sponsored investment fund accounted for as a VOE as of December 31, 2020, because it was no longer the majority investor in the fund, and as such, did not have a controlling financial interest in the fund.

Fair Value Measurement

Upon consolidation, the Company elected to apply the FVO for financial assets and financial liabilities held by CLOs and continued to measure these assets (primarily corporate loans) and liabilities (debt obligations issued by CLOs) at fair value in subsequent periods. The Company has elected the FVO to more closely align its accounting with the economics of its transactions and allows the Company to more effectively align changes in the fair value of CLO assets with a commensurate change in the fair value of CLO liabilities.

Investments held by consolidated private equity funds are measured and reported at fair value in the Company's Condensed Consolidated Financial Statements. Changes in the fair value of consolidated investment entities are recorded as a separate line item within Income (loss) related to consolidated investment entities in the Company's Condensed Consolidated Statements of Operations.

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The methodology for measuring the fair value of financial assets and liabilities of consolidated investment entities, and the classification of these measurements in the fair value hierarchy is consistent with the methodology and classification applied by the Company to its investment portfolio, as discussed within the Fair Value Measurements (excluding Consolidated Investment Entities) Note to these Condensed Consolidated Financial Statements.

As discussed in more detail below, the Company utilizes valuations obtained from third-party commercial pricing services, brokers and investment sponsors or third-party administrators that supply NAV (or its equivalent) per share used as a practical expedient. The valuations obtained from brokers and third-party commercial pricing services are non-binding. These valuations are reviewed on a monthly or quarterly basis depending on the entity and its underlying investments. Procedures include, but are not limited to, a review of underlying fund investor reports, review of top and worst performing funds requiring further scrutiny, review of variance from prior periods and review of variance from benchmarks, where applicable. In addition, the Company considers both macro and fund specific events that may impact the latest NAV supplied and determines if further adjustments of value should be made. Such changes, if any, are subject to senior management review.

When a price cannot be obtained from a commercial pricing service, independent broker quotes are solicited. Securities priced using independent broker quotes are classified as Level 3. Broker quotes and prices obtained from pricing services are reviewed and validated through an internal valuation committee price variance review, comparisons to internal pricing models, back testing to recent trades or monitoring of trading volumes.

Cash and Cash Equivalents

The carrying amounts for cash reflect the assets’ fair values. The fair value for cash equivalents is determined based on quoted market prices. These assets are classified as Level 1.

CLOs

Corporate loans : Corporate loan investments, which comprise the majority of consolidated CLO portfolio collateral, are senior secured corporate loans maturing at various dates between 2023 and 2029, paying interest at LIBOR , EURIBOR or PRIME plus a spread of up to 10.0 %. As of September 30, 2021 and December 31, 2020, the unpaid principal balance exceeded the fair value of the corporate loans by approximately $ 9 and $ 20 , respectively. Less than 1.0 % of the collateral assets were in default as of September 30, 2021 and December 31, 2020.

The fair values for corporate loans are determined using independent commercial pricing services. Fair value measurement based on pricing services may be classified in Level 2 or Level 3 depending on the type, complexity, observability and liquidity of the asset being measured. The inputs used by independent commercial pricing services, such as benchmark yields and credit risk adjustments, are those that are derived principally from or corroborated by observable market data. Hence, the fair value measurement of corporate loans priced by independent pricing service providers is classified within Level 2 of the fair value hierarchy. In addition, there are assets held with CLO portfolios that represent senior level debt of other third party CLOs. These CLO investments are classified within Level 3 of the fair value hierarchy. See description of fair value process for CLO notes below.

CLO notes : The CLO notes are backed by diversified loan portfolios consisting primarily of senior secured floating rate leveraged loans. Repayment risk is segmented into tranches with credit ratings of these tranches reflecting both the credit quality of underlying collateral as well as how much protection a given tranche is afforded by tranches that are subordinate to it. The most subordinated tranche bears the first loss and receives the residual payments, if any. The interest rates are generally variable rates based on LIBOR or EURIBOR plus a pre-defined spread, which varies from 0.5 % for the more senior tranches to 8.5 % for the more subordinated tranches. CLO notes mature in 2026 and 2034, and have a weighted average maturity of 11 years as of September 30, 2021. The investors in this debt are not affiliated with the Company and have no recourse to the general credit of the Company for this debt.

The fair values of the CLO notes are measured based on the fair value of the CLO's corporate loans, as the Company uses the measurement alternative available under ASU 2014-13 and determined that the inputs for measuring financial assets are more observable. The CLO notes are classified within Level 2 of the fair value hierarchy, consistent with the classification of the majority of the CLO financial assets.

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The Company reviews the detailed prices including comparisons to prior periods for reasonableness. The Company utilizes a formal pricing challenge process to request a review of any price during which time the vendor examines its assumptions and relevant market inputs to determine if a price change is warranted.

The following narrative indicates the sensitivity of inputs:

• Default Rate: An increase (decrease) in the expected default rate would likely increase (decrease) the discount margin (increase risk premium) used to value the CLO investments and CLO notes and, as a result, would potentially decrease the value of the CLO investments and CLO notes.

• Recovery Rate: A decrease (increase) in the expected recovery of defaulted assets would potentially decrease (increase) the valuation of CLO investments and CLO notes.

• Prepayment Rate: A decrease (increase) in the expected rate of collateral prepayments would potentially decrease (increase) the valuation of CLO investments and CLO notes as the expected weighted average life ("WAL") would increase (decrease).

• Discount Margin (spread over LIBOR): An increase (decrease) in the discount margin used to value the CLO investments and CLO notes would decrease (increase) the value of the CLO investments and CLO notes.

Private Equity Funds

As prescribed in ASC Topic 820, the unit of account for these investments is the interest in the investee fund. The Company owns an undivided interest in the fund portfolio and does not have the ability to dispose of individual assets and liabilities in the fund portfolio. Rather, the Company would be required to redeem or dispose of its entire interest in the investee fund. There is no current active market for interests in underlying private equity funds.

Valuation is generally based on the valuations provided by the fund's general partner or investment manager. The valuations typically reflect the fair value of the Company's capital account balance of each fund investment, including unrealized capital gains (losses), as reported in the financial statements of the respective investee fund as of the respective year end or the latest available date. In circumstances where fair values are not provided, the Company seeks to determine the fair value of fund investments based upon other information provided by the fund's general partner or investment manager or from other sources.

The fair value of securities received in-kind from fund investments is determined based on the restrictions around the securities.

• Unrestricted, publicly traded securities are valued at the closing public market price on the reporting date;

• Restricted, publicly traded securities may be valued at a discount from the closing public market price on the reporting date, depending on the circumstances; and

• Privately held securities are valued by the directors/general partner of the investee fund, based on a variety of factors, including the price of recent transactions in the company's securities and the company's earnings, revenue and book value.

In the case of direct investments or co-investments in private equity companies, the Company initially recognizes investments at cost and subsequently adjusts investments to fair value. On a quarterly basis, the Company reviews the general partner or lead investor's valuation of the investee company, taking into account other available information, such as indications of a market value through subsequent issues of capital or transactions between third parties, performance of the investee company during the period and public, comparable companies' analysis, where appropriate.

Investments in these funds typically may not be fully redeemed at net asset value ("NAV") within 90 days because of inherent restriction on near term redemptions.

As of September 30, 2021 and December 31, 2020, certain private equity funds maintained term loans and revolving lines of credit of $ 1,225 and $ 647 , respectively. The term loans mature in three to five years , and the revolving lines of credit are eligible for renewal every three years ; all loans bear interest at LIBOR / EURIBOR plus 150 - 215 bps. The lines of credit are used for funding transactions before capital is called from investors, as well as for the financing of certain purchases. As of September 30, 2021 and December 31, 2020, outstanding borrowings amount to $ 735 and $ 491 , respectively. The borrowings are reflected in Liabilities related to consolidated investment entities - other liabilities on the Company's Condensed Consolidated Balance Sheets. The borrowings are carried at an amount equal to the unpaid principal balance.

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The following table summarizes the fair value hierarchy levels of consolidated investment entities as of September 30, 2021:

			Level 1						Level 2						Level 3						NAV						Total
Assets
Cash and cash equivalents			$	141					$	—					$	—					$	—					$	141
Corporate loans, at fair value using the fair value option			—						917						—						—						917
Limited partnerships/corporations, at fair value			—						—						—						2,505						2,505
Total assets, at fair value			$	141					$	917					$	—					$	2,505					$	3,563
Liabilities
CLO notes, at fair value using the fair value option			$	—					$	749					$	—					$	—					$	749
Total liabilities, at fair value			$	—					$	749					$	—					$	—					$	749

The following table summarizes the fair value hierarchy levels of consolidated investment entities as of December 31, 2020:

			Level 1						Level 2						Level 3						NAV						Total
Assets
Cash and cash equivalents			$	221					$	—					$	—					$	—					$	221
Corporate loans, at fair value using the fair value option			—						805						—						—						805
Limited partnerships/corporations, at fair value			—						—						—						1,724						1,724
Total assets, at fair value			$	221					$	805					$	—					$	1,724					$	2,750
Liabilities
CLO notes, at fair value using the fair value option			$	—					$	783					$	—					$	—					$	783
Total liabilities, at fair value			$	—					$	783					$	—					$	—					$	783

Transfers of investments out of Level 3 and into Level 2 or Level 1, if any, are recorded as of the beginning of the period in which the transfer occurred. For the three and nine months ended September 30, 2021 and 2020, there were no transfers in or out of Level 3 or transfers between Level 1 and Level 2.

Deconsolidation of Certain Investment Entities

The Company had no deconsolidations during the three and nine months ended September 30, 2021. The Company determined its interest in the Pomona Investment Fund was less than a majority of the fund's NAV and therefore did not represent a controlling financial interest. As a result of this determination, the Company deconsolidated one investment entity during the nine months ended September 30, 2020. The Company had no deconsolidations during the three months ended September 30, 2020.

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Nonconsolidated VIEs

The Company also holds variable interest in certain CLOs and LPs that are not consolidated as it has been determined that the Company is not the primary beneficiary.

CLOs

As of September 30, 2021 and December 31, 2020, the Company held $ 431 and $ 405 ownership interests, respectively, in unconsolidated CLOs, which also represents the Company's maximum exposure to loss.

LPs

As of September 30, 2021 and December 31, 2020, the Company held $ 1,671 and $ 1,476 ownership interests, respectively, in unconsolidated limited partnerships, which also represents the Company's maximum exposure to loss.

Securitizations

The Company invests in various tranches of securitization entities, including RMBS, CMBS and ABS. Through its investments, the Company is not obligated to provide any financial or other support to these entities. Each of the RMBS, CMBS and ABS entities are thinly capitalized by design and considered VIEs. The Company's involvement with these entities is limited to that of a passive investor. The Company has no unilateral right to appoint or remove the servicer, special servicer or investment manager, which are generally viewed to have the power to direct the activities that most significantly impact the securitization entities' economic performance, in any of these entities, nor does the Company function in any of these roles. The Company, through its investments or other arrangements, does not have the obligation to absorb losses or the right to receive benefits from the entity that could potentially be significant to the entity. Therefore, the Company is not the primary beneficiary and does not consolidate any of the RMBS, CMBS and ABS entities in which it holds investments. These investments are accounted for as investments available-for-sale as described in the Fair Value Measurements (excluding Consolidated Investment Entities) Note to these Condensed Consolidated Financial Statements and unrealized capital gains (losses) on these securities are recorded directly in AOCI, except for certain RMBS which are accounted for under the FVO whose change in fair value is reflected in Other net realized gains (losses) in the Condensed Consolidated Statements of Operations. The Company’s maximum exposure to loss on these structured investments is limited to the amount of its investment. Refer to the Investments (excluding Consolidated Investment Entities) Note to these Condensed Consolidated Financial Statements for details regarding the carrying amounts and classifications of these assets.

Organizational Restructuring

Pursuant to the Company executing the Resolution MTA and the Individual Life Transaction, the Company sold five of its legal subsidiaries, SLD, SLDI, Roaring River II ("RRII"), Midwestern United Life Insurance Company ("MUL") and Voya American Equities, Inc. ("VAE") to Resolution Life US, which is an insurance holding company newly formed by Resolution Life Group Holdings, L.P. (“RLGH”), a Bermuda-based limited partnership. The Company also executed an agreement with Cetera on June 9, 2021, where Cetera acquired the independent financial planning channel of VFA. Additionally, the Company transferred or ceased usage of a substantial number of administrative systems and is undertaking restructuring efforts to reduce stranded expenses associated with its Individual Life business and independent financial planning channel as well as its corporate and shared services functions. The Company anticipates incurring additional restructuring expenses directly and indirectly related to these dispositions beyond the third quarter of 2021, o f $ 50 - $ 100 in addition to the $ 78 incurred during 2020 and $ 76 incurred for the nine months ended September 30, 2021.

The prior restructuring initiatives disclosed in the 2020 Form 10-K concluded prior to 2021 and the Company does not anticipate incurring any additional restructuring expenses related to those initiatives.

The restructuring activities related to the Individual Life Transaction and the sale of the independent financial planning channel have resulted in recognition of severance and organizational transition costs that are reflected in both continuing operations and discontinued operations. Amounts reflected in continuing operations are reported in Operating expenses in the Condensed

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Consolidated Statements of Operations, but excluded from Adjusted operating earnings before income taxes. These expenses are classified as a component of Other adjustments to Income (loss) from continuing operations before income taxes and consequently are not included in the adjusted operating results of the Company's segments.

The summary below presents Organizational Restructuring expenses, pre-tax, by type of costs incurred, for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,												Cumulative Amounts Incurred to Date (1)
			2021						2020						2021						2020
Severance benefits			$	5					$	( 3 )					$	19					$	( 11 )					$	80
Organizational transition costs			19						30						57						94						381
Total restructuring expenses			$	24					$	27					$	76					$	83					$	461
Continuing operations			$	24					$	10					$	76					$	46					$	396
Discontinued operations			$	—					$	17					$	—					$	37					$	65

(1) Includes expenses incurred during 2017-2021.

The following table presents the accrued liability associated with Organizational Restructuring expenses as of September 30, 2021:

			Severance Benefits																		Organizational Transition Costs						Total
Accrued liability as of January 1, 2021			$	21																	$	33					$	54
Provision			19																		57						76
Payments			( 11 )																		( 72 )						( 83 )
Accrued liability as of September 30, 2021			$	29																	$	18					$	47

On January 4, 2021, the Company completed a series of transactions pursuant to the Resolution MTA entered into on December

18, 2019 with Resolution Life US to sell several of its subsidiaries and the related Individual Life and fixed and variable annuities businesses within these subsidiaries. See the Business Held for Sale and Discontinued Operations Note to these Condensed Consolidated Financial Statements.

On March 15, 2021, the Company announced several updates to our operating model and leadership team. In conjunction with those updates, the Retirement and Employee Benefits segments were renamed to Wealth Solutions and Health Solutions, respectively. The Company will continue to provide its principal products and services through three segments: Wealth Solutions, Investment Management and Health Solutions.

Measurement

Adjusted operating earnings before income taxes is a measure used by management to evaluate segment performance. The Company believes that Adjusted operating earnings before income taxes provides a meaningful measure of its business and segment performances and enhances the understanding of the Company’s financial results by focusing on the operating performance and trends of the underlying business segments and excluding items that tend to be highly variable from period to period based on capital market conditions and/or other factors. The Company uses the same accounting policies and procedures to measure segment Adjusted operating earnings before income taxes as it does for the directly comparable U.S. GAAP measure Income (loss) from continuing operations before income taxes. Adjusted operating earnings before income taxes does not replace Income (loss) from continuing operations before income taxes as the U.S. GAAP measure of the Company’s consolidated results of operations. Therefore, the Company believes that it is useful to evaluate both Income (loss) from continuing operations before income taxes and Adjusted operating earnings before income taxes when reviewing the

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Company’s financial and operating performance. Each segment’s Adjusted operating earnings before income taxes is calculated by adjusting Income (loss) from continuing operations before income taxes for the following items:

• Net investment gains (losses), net of related amortization of DAC, VOBA, sales inducements and unearned revenue, which are significantly influenced by economic and market conditions, including interest rates and credit spreads, and are not indicative of normal operations. Net investment gains (losses) include gains (losses) on the sale of securities, impairments, changes in the fair value of investments using the FVO unrelated to the implied loan-backed security income recognition for certain mortgage-backed obligations and changes in the fair value of derivative instruments, excluding realized gains (losses) associated with swap settlements and accrued interest;

• Net guaranteed benefit hedging gains (losses), which are significantly influenced by economic and market conditions and are not indicative of normal operations, include changes in the fair value of derivatives related to guaranteed benefits, net of related reserve increases (decreases) and net of related amortization of DAC, VOBA and sales inducements, less the estimated cost of these benefits. The estimated cost, which is reflected in Adjusted operating results, reflects the expected cost of these benefits if markets perform in line with the Company's long-term expectations and includes the cost of hedging. Other derivative and reserve changes related to guaranteed benefits are excluded from adjusted operating earnings, including the impacts related to changes in the Company's nonperformance spread;

• Income (loss) related to businesses exited or to be exited through reinsurance or divestment, which includes gains and (losses) associated with transactions to exit blocks of business within continuing operations (including net investment gains (losses) on securities sold and expenses directly related to these transactions) and residual run-off activity (including an insignificant number of Individual Life, and non-Wealth Solution annuities policies that were not part of the divested businesses). Excluding this activity, which also includes amortization of intangible assets related to businesses exited or to be exited, better reveals trends in the Company's core business and more closely aligns Adjusted operating earnings before income taxes with how the Company manages its segments;

• Income (loss) attributable to noncontrolling interest, which represents the interest of shareholders, other than those of the Company, in consolidated entities. Income (loss) attributable to noncontrolling interest represents such shareholders' interests in the gains and (losses) of those entities, or the attribution of results from consolidated VIEs or VOEs to which the Company is not economically entitled;

• Dividend payments made to preferred shareholders are included as reductions to reflect the Adjusted operating earnings that is available to common shareholders;

• Income (loss) related to early extinguishment of debt, which includes losses incurred as a result of transactions where the Company repurchases outstanding principal amounts of debt; these losses are excluded from Adjusted operating earnings before income taxes since the outcome of decisions to restructure debt are not indicative of normal operations;

• Impairment of goodwill, value of management contract rights and value of customer relationships acquired, which includes losses as a result of impairment analysis; these represent losses related to infrequent events and do not reflect normal, cash-settled expenses;

• Immediate recognition of net actuarial gains (losses) related to the Company's pension and other postretirement benefit obligations and gains (losses) from plan amendments and curtailments, which includes actuarial gains and losses as a result of differences between actual and expected experience on pension plan assets or projected benefit obligation during a given period. The Company immediately recognizes actuarial gains and (losses) related to pension and other postretirement benefit obligations and gains and losses from plan adjustments and curtailments. These amounts do not reflect normal, cash-settled expenses and are not indicative of current Operating expense fundamentals; and

• Other items not indicative of normal operations or performance of the Company's segments or related to events such as

capital or organizational restructurings undertaken to achieve long-term economic benefits, including certain costs related to debt and equity offerings, acquisition / merger integration expenses, severance and other expenses associated with such activities, and expenses attributable to vacant real estate. These items vary widely in timing, scope and frequency between periods as well as between companies to which the Company is compared. Accordingly, the Company adjusts for these items as management believes that these items distort the ability to make a meaningful evaluation of the current and future performance of the Company's segments.

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The summary below reconciles Adjusted operating earnings before income taxes for the segments to Income (loss) from continuing operations before income taxes for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Income (loss) from continuing operations before income taxes			$	411					$	( 145 )					$	2,477					$	( 143 )
Less Adjustments:
Net investment gains (losses) and related charges and adjustments			( 1 )						29						66						63
Net guaranteed benefit hedging gains (losses) and related charges and adjustments			( 3 )						16						2						( 36 )
Income (loss) related to businesses exited or to be exited through reinsurance or divestment			( 173 )						( 342 )						798						( 387 )
Income (loss) attributable to noncontrolling interest			214						106						661						33
Income (loss) related to early extinguishment of debt			—						—						( 10 )						—
Dividend payments made to preferred shareholders			14						14						32						32
Other adjustments			( 28 )						( 8 )						( 86 )						( 39 )
Total adjustments to income (loss) from continuing operations			$	22					$	( 185 )					$	1,463					$	( 333 )
Adjusted operating earnings before income taxes by segment:
Wealth Solutions			$	319					$	25					$	869					$	185
Investment Management			63						47						180						106
Health Solutions			71						56						171						154
Corporate			( 65 )						( 88 )						( 207 )						( 254 )
Total			$	388					$	40					$	1,014					$	190

Adjusted operating revenues is a measure of the Company's segment revenues. Each segment's Operating revenues are calculated by adjusting Total revenues to exclude the following items:

• Net investment gains (losses) and related charges and adjustments, which are significantly influenced by economic and market conditions, including interest rates and credit spreads and are not indicative of normal operations. Net investment gains (losses) include gains (losses) on the sale of securities, impairments, changes in the fair value of investments using the FVO unrelated to the implied loan-backed security income recognition for certain mortgage-backed obligations and changes in the fair value of derivative instruments, excluding realized gains (losses) associated with swap settlements and accrued interest. These are net of related amortization of unearned revenue;

• Gains (losses) on changes in fair value of derivatives related to guaranteed benefits, which is significantly influenced by economic and market conditions and not indicative of normal operations, includes changes in the fair value of derivatives related to guaranteed benefits, less the estimated cost of these benefits. The estimated cost, which is reflected in Adjusted operating revenues, reflects the expected cost of these benefits if markets perform in line with the Company's long-term expectations and includes the cost of hedging. Other derivative and reserve changes related to guaranteed benefits are excluded from Adjusted operating revenues, including the impacts related to changes in the Company's nonperformance spread;

• Revenues related to businesses exited or to be exited through reinsurance or divestment, which includes revenues associated with transactions to exit blocks of business within continuing operations (including net investment gains (losses) on securities sold related to these transactions) and residual run-off activity (including an insignificant number of Individual Life, and non-Wealth Solution annuities policies that were not part of the divested businesses). Excluding this activity better reveals trends in the Company's core business and more closely aligns Adjusted operating revenues with how the Company manages its segments;

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• Revenues attributable to noncontrolling interest, which represents the interests of shareholders, other than the Company, in consolidated entities. Revenues attributable to noncontrolling interest represents such shareholders' interests in the gains and losses of those entities, or the attribution of results from consolidated VIEs or VOEs to which the Company is not economically entitled; and

• Other adjustments to Total revenues primarily reflect fee income earned by the Company's broker-dealers for sales of non-proprietary products, which are reflected net of commission expense in the Company's segments’ operating revenues, other items where the income is passed on to third parties and the elimination of intercompany investment expenses included in Adjusted operating revenues.

The summary below reconciles Adjusted operating revenues for the segments to Total revenues for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Total revenues			$	2,009					$	2,071					$	2,555					$	5,425
Adjustments:
Net realized investment gains (losses) and related charges and adjustments			( 5 )						27						( 44 )						60
Gains (losses) on change in fair value of derivatives related to guaranteed benefits			( 3 )						16						2						( 36 )
Revenues related to businesses exited or to be exited through reinsurance or divestment			57						399						( 3,356 )						1,075
Revenues attributable to noncontrolling interest			228						116						697						59
Other adjustments			44						80						358						212
Total adjustments to revenues			320						638						$	( 2,343 )					$	1,370
Adjusted operating revenues by segment:
Wealth Solutions			857						718						$	2,446					$	1,954
Investment Management			200						173						582						467
Health Solutions			606						541						1,796						1,615
Corporate			25						2						73						20
Total			$	1,689					$	1,434					$	4,898					$	4,056

Other Segment Information

The Investment Management segment revenues include the following intersegment revenues, primarily consisting of asset-based management and administration fees for the periods indicated:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Investment Management intersegment revenues			$	23					$	28					$	68					$	81

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The summary below presents Total assets for the Company’s segments as of the dates indicated:

			September 30, 2021						December 31, 2020
Wealth Solutions			$	134,485					$	129,801
Investment Management			1,048						1,027
Health Solutions			3,039						2,917
Corporate			26,526						23,535
Total assets, before consolidation (1)			165,098						157,280
Consolidation of investment entities			3,319						2,535
Total assets, excluding assets held for sale			168,417						159,815
Assets held for sale			—						20,703
Total assets			$	168,417					$	180,518

(1) Total assets, before consolidation includes the Company's direct investments in CIEs prior to consolidation, which are accounted for using the equity method or fair value option.

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