VOYA 10-Q Quarter ended Sept. 30, 2022

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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. P roducts and services are provided by the Company through three segments: Wealth Solutions, Health Solutions and Investment Management . Activities not directly related to the Company's segments and certain run-off activities that are not meaningful to the Company's business strategy are included within Corporate. See the Segments Note to these Condensed Consolidated Financial Statements.

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 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 500 field and phone-based financial professionals who support our Wealth Solutions business.

On July 25, 2022, the Company completed a series of transactions pursuant to a Combination Agreement dated June 13, 2022 (the “Agreement”) with Voya Investment Management LLC, a Delaware limited liability company and an indirect subsidiary of the Company (“Voya IM”), Allianz SE, a stock corporation organized and existing under the laws of the European Union and the Federal Republic of Germany (“Allianz”), Allianz Global Investors U.S. LLC, a Delaware limited liability company and an indirect subsidiary of Allianz (“AGI U.S.”), and VIM Holdings LLC, a newly formed Delaware limited liability company (“Newco”), pursuant to which the parties have combined Voya IM with assets and teams comprising specified transferred strategies managed by AGI U.S. The transaction enables the Company to increase international scale and distribution of the Company’s investment products and provides diverse investment strategies that meet the needs of a larger more global client base.

Under the terms of the Agreement, AGI U.S. transferred to Newco the rights to certain assets and liabilities related to specified investment teams and strategies and the associated assets under management (the “AGI Transferred Business”). The Company transferred all of the limited liability company interests in Voya IM to Newco and in exchange, received a 76 % economic stake in Newco's class A shares. Pursuant to the Amended and Restated Limited Liability Company Agreement of Newco entered into at the closing date (“A&R Newco Operating Agreement”), the Company now holds, indirectly, a 76 % economic stake in Newco's class A shares and Allianz holds, indirectly, a 24 % economic stake in Newco's class A shares. Furthermore, Newco holds all of the limited liability company interests in Voya IM and certain assets and liabilities transferred from AGI U.S. related to specified investment teams and strategies and the associated assets under management. In accordance with the A&R Newco Operating Agreement, the Company has full operational control of Newco, Voya IM and the transferred assets and investment teams.

The Agreement was executed for noncash consideration and accounted for under the acquisition method of accounting. Accordingly, the purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair

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values as of the date of the transaction. The 24% economic stake in Newco’s class A shares is reflected on the Condensed Consolidated Balance Sheets under Redeemable noncontrolling interests within Mezzanine equity.

On November 1, 2022, Voya Investment Management Alternative Assets, LLC (“VIMAA”), one of the Company’s indirect subsidiaries, acquired all of the issued and outstanding equity interests of Czech Asset Management, L.P., a Delaware limited partnership, a private credit asset manager dedicated to the U.S. middle market pursuant to a sales and purchase agreement (“SPA”) entered into on August 1, 2022 with Czech Management GP, LLC, a Delaware limited liability company, and Czech Holdings, LLC, a Delaware limited liability company. The acquisition was executed for cash consideration and will expand VIMAA's private and leveraged credit business and is subject to conditions as defined in the SPA.

On November 1, 2022, the Company and Origami Squirrel Acquisition Corp, a newly formed Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”), entered into an agreement and plan of merger (the “Merger Agreement”) with Benefitfocus, Inc. (“BNFT”), a Delaware corporation, pursuant to which, Merger Sub will merge with and into BNFT (the “Merger”), with BNFT surviving such Merger as a wholly owned subsidiary of the Company. The transaction is expected to close in the first quarter of 2023, subject to terms and customary closing conditions as set in the Merger agreement.

Under the terms of the Merger Agreement, the Company will acquire all outstanding shares of BNFT for approximately $ 570 in cash consideration which includes the outstanding debt and preferred shares of BNFT. The acquisition will expand the Company’s capacity to meet the growing demand for comprehensive benefits and savings solutions and increase its ability to deliver innovative solutions for employers and health plans.

Impairment of Long-lived Assets

The carrying value of long-lived assets is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. An impairment loss is recognized whenever the carrying amount of an asset exceeds its estimated fair value. The amount of the impairment loss is calculated as the excess of the asset’s carrying value over its fair value. During the second quarter of 2022, the Company had a triggering event related to a decrease in the market price of one of its office buildings. Consequently, the Company determined its fair value, based on an appraisal, to be lower than its carrying value. As a result, the Company recognized an impairment loss of $ 32 , which is included in Operating expenses in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2022.

Revision of Prior Period Financial Statements

During the second quarter of 2022, the Company identified a presentation error related to a misclassification in the change in cash held by CIEs within the Condensed Consolidated Statements of Cash Flows. This error resulted in the total end of period cash and cash equivalents in the Condensed Consolidated Statements of Cash Flows not to reconcile to all cash and cash equivalents line items presented in the Condensed Consolidated Balance Sheets. The Company assessed the materiality of the error on prior period financial statements in accordance with the Accounting Changes and Error Corrections guidance. The Company has corrected the presentation error in the comparative period for the nine months ended September 30, 2021 and evaluated the materiality of such error based on relevant quantitative and qualitative factors in relation to the Condensed Consolidated Financial Statements. The Company’s evaluation of the qualitative factors included, but was not limited to, consideration of the users of the Condensed Consolidated Financial Statements; there was no impact to net income, comprehensive income, total stockholders' equity or amounts on the Condensed Consolidated Balance Sheets; there was no impact on regulatory capital, cash balances or any liquidity measures; and there was no impact on any contractual or regulatory requirements. Based on this evaluation, the Company concluded that the error in the Condensed Consolidated Statements of Cash Flows did not result in a material misstatement of previously issued financial statements. The following table presents the impact of the error on the specific line items in the Condensed Consolidated Statements of Cash Flows:

			Nine Months Ended September 30, 2021
			As Reported						Adjustments						As Adjusted
Net cash provided by (used in) operating activities			$	( 68 )					$	( 80 )					$	( 148 )
Net decrease in cash and cash equivalents, including cash in CIEs			( 245 )						( 80 )						( 325 )
Cash and cash equivalents, including cash in CIEs, beginning of period			1,922						221						2,143
Cash and cash equivalents, including cash in CIEs, end of period			1,677						141						1,818

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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.

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, 2022, its results of operations, comprehensive income and changes in shareholders' equity for the three and nine months ended September 30, 2022 and 2021, and its statements of cash flows for the nine months ended September 30, 2022 and 2021, 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 (loss) or Total shareholders’ equity.

The December 31, 2021 Consolidated Balance Sheets are 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 .

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
Accounting Standards Update (“ASU”) 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions			This standard, issued in June 2022, clarifies that contractual restrictions on equity security sales are not considered part of the security unit of account and, therefore, are not considered in measuring fair value. In addition, the restrictions cannot be recognized and measured as separate units of account. Disclosures on such restrictions are also required.			The amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, and are required to be applied prospectively, with any adjustments from the adoption recognized in earnings and disclosed.			The Company is currently in the process of determining the impact of adoption of the provisions of ASU 2022-03.

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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 Company determined that the entities disposed of met the criteria to be classified as discontinued operations and that the sale represented a strategic shift that had a major effect on the Company’s operations. Income (loss) from discontinued operations, net of tax, for the nine months ended September 30, 2021 included a reduction to loss on sale, net of tax of $ 7 associated with the transaction. For more information related to this transaction, refer to the Discontinued Operations Note to the Consolidated Financial Statements included in Part II, Item 8 of the Annual Report on form 10-K.

Subsequent to the close 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.

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Fixed Maturities

Available-for-sale and fair value option ("FVO") fixed maturities were as follows as of September 30, 2022:

			Amortized Cost						Gross Unrealized Capital Gains						Gross Unrealized Capital Losses						Embedded Derivatives (2)						Fair Value						Allowance for credit losses
Fixed maturities:
U.S. Treasuries			$	724					$	25					$	17					$	—					$	732					$	—
U.S. Government agencies and authorities			47						3						1						—						49						—
State, municipalities and political subdivisions			993						1						130						—						864						—
U.S. corporate public securities			10,180						89						1,451						—						8,815						3
U.S. corporate private securities			5,052						7						477						—						4,582						—
Foreign corporate public securities and foreign governments (1)			3,347						9						489						—						2,854						13
Foreign corporate private securities (1)			3,379						3						307						—						3,058						17
Residential mortgage-backed securities			4,233						36						287						3						3,982						3
Commercial mortgage-backed securities			4,490						4						484						—						4,009						1
Other asset-backed securities			2,298						3						205						—						2,094						2
Total fixed maturities, including securities pledged			34,743						180						3,848						3						31,039						39
Less: Securities pledged			1,297						7						181						—						1,123						—
Total fixed maturities			$	33,446					$	173					$	3,667					$	3					$	29,916					$	39

(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 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, 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			$	764					$	239					$	—					$	—					$	1,003					$	—
U.S. Government agencies and authorities			69						12						—						—						81						—
State, municipalities and political subdivisions			1,000						112						1						—						1,111						—
U.S. corporate public securities			10,402						1,580						41						—						11,941						—
U.S. corporate private securities			4,889						459						23						—						5,325						—
Foreign corporate public securities and foreign governments (1)			3,373						368						18						—						3,723						—
Foreign corporate private securities (1)			3,320						238						1						—						3,501						56
Residential mortgage-backed securities			4,183						139						31						12						4,302						1
Commercial mortgage-backed securities			4,032						173						22						—						4,183						—
Other asset-backed securities			2,069						25						12						—						2,081						1
Total fixed maturities, including securities pledged			34,101						3,345						149						12						37,251						58
Less: Securities pledged			1,091						107						—						—						1,198						—
Total fixed maturities			$	33,010					$	3,238					$	149					$	12					$	36,053					$	58

(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 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, 2022, 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			$	688					$	661
After one year through five years			4,195						3,929
After five years through ten years			4,959						4,513
After ten years			13,880						11,851
Mortgage-backed securities			8,723						7,991
Other asset-backed securities			2,298						2,094
Fixed maturities, including securities pledged			$	34,743					$	31,039

As of September 30, 2022 and December 31, 2021, 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, 2022
Communications			$	1,276					$	17					$	157					$	1,136
Financial			4,289						22						560						3,751
Industrial and other companies			9,003						23						1,172						7,854
Energy			1,888						29						182						1,735
Utilities			3,788						13						425						3,376
Transportation			1,142						2						146						998
Total			$	21,386					$	106					$	2,642					$	18,850
December 31, 2021
Communications			$	1,261					$	238					$	3					$	1,496
Financial			3,752						394						13						4,133
Industrial and other companies			9,600						1,058						32						10,626
Energy			1,907						314						18						2,203
Utilities			3,782						499						11						4,270
Transportation			1,130						93						1						1,222
Total			$	21,432					$	2,596					$	78					$	23,950

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, 2022 and December 31, 2021, approximately 39.6 % and 40.6 %, 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, 2022 and December 31, 2021, the Company did no t have any securities pledged in dollar rolls or reverse repurchase agreements. As of September 30, 2022, the carrying value of securities pledged and obligation to repay loans related to repurchase agreement transactions were $ 120 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, 2021, the carrying value of securities pledged and obligation to repay loans related to repurchase agreement transactions were $ 105 . 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 102 % 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, 2022 and December 31, 2021, the fair value of loaned securities was $ 854 and $ 969 , 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, 2022 and December 31, 2021, cash collateral retained by the lending agent and invested in short-term liquid assets on the Company's behalf was $ 795 and $ 884 , 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, 2022 and December 31, 2021, liabilities to return collateral of $ 795 and $ 884 , 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, 2022 and December 31, 2021, the fair value of securities retained as collateral by the lending agent on the Company’s behalf was $ 100 and $ 117 , respectively.

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

			September 30, 2022						December 31, 2021
U.S. Treasuries			$	19					$	42
U.S. Government agencies and authorities			—						3
U.S. corporate public securities			641						599
Equity Securities			2						—
Foreign corporate public securities and foreign governments			233						357
Payables under securities loan agreements			$	895					$	1,001

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.

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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 periods presented:

			Nine Months Ended September 30, 2022
			U.S. corporate public securities						Residential mortgage-backed securities						Commercial mortgage-backed securities						Foreign corporate public securities and foreign governments						Foreign corporate private securities						Other asset-backed securities						Total
Balance as of January 1			$	—					$	1					$	—					$	—					$	56					$	1					$	58
Credit losses on securities for which credit losses were not previously recorded			3						3						1						13						—						1						21
Initial allowance for credit losses recognized on financial assets accounted for as PCD			—						—						—						—						—						—						—
Reductions for securities sold during the period			—						—						—						—						( 41 )						—						( 41 )
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			—						—						—						—						—						—						—
Increase (decrease) on securities with allowance recorded in previous period			—						( 1 )						—						—						2						—						1
Write-offs			—						—						—						—						—						—						—
Recoveries of amounts previously written-off			—						—						—						—						—						—						—
Balance as of September 30			$	3					$	3					$	1					$	13					$	17					$	2					$	39

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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, 2022:

			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			$	137					$	15					20																		$	27					$	2					6						$	164					$	17					26
U.S. Government agencies and authorities			7						1						1																		—						—						—						7						1						1
State, municipalities and political subdivisions			809						129						304																		3						1						5						812						130						309
U.S. corporate public securities			6,291						1,095						1,227																		805						356						268						7,096						1,451						1,495
U.S. corporate private securities			3,736						421						393																		294						56						18						4,030						477						411
Foreign corporate public securities and foreign governments			2,363						385						439																		242						104						73						2,605						489						512
Foreign corporate private securities			2,863						304						235																		14						3						3						2,877						307						238
Residential mortgage-backed			1,867						188						565																		463						99						212						2,330						287						777
Commercial mortgage-backed			3,310						396						541																		542						88						98						3,852						484						639
Other asset-backed			1,749						173						415																		219						32						104						1,968						205						519
Total			$	23,132					$	3,107					4,140																		$	2,609					$	741					787						$	25,741					$	3,848					4,927

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, 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			$	16					$	—		*			8																		$	12					$	—		*			2						$	28					$	—		*			10
State, municipalities and political subdivisions			58						1						22																		—						—						—						58						1						22
U.S. corporate public securities			1,425						35						292																		115						6						119						1,540						41						411
U.S. corporate private securities			447						5						34																		122						18						9						569						23						43
Foreign corporate public securities and foreign governments			534						16						97																		28						2						14						562						18						111
Foreign corporate private securities			70						1						7																		11						—			*			1						81						1						8
Residential mortgage-backed			704						18						244																		294						13						116						998						31						360
Commercial mortgage-backed			1,137						12						191																		228						10						32						1,365						22						223
Other asset-backed			922						8						221																		98						4						56						1,020						12						277
Total			$	5,313					$	96					1,116																		$	908					$	53					349						$	6,221					$	149					1,465

*Less than $1

Based on the Company's quarterly evaluation of its securities in an unrealized loss position, described below, the Company concluded that these securities were not impaired as of September 30, 2022. 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, increased $ 3,699 from $ 149 to $ 3,848 for the nine months ended September 30, 2022. The increase in unrealized losses was driven by materially higher interest rates across the yield curve and moderately wider credit spreads.

As of September 30, 2022, $ 6 of the total $ 3,848 of gross unrealized losses were from 5 available-for-sale fixed maturity securities with an unrealized loss position of 20 % or more of amortized cost for 12 months or greater.

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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.

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,
			2022												2021
			Impairment						No. of Securities						Impairment						No. of Securities
Foreign corporate public securities and foreign governments (1)			$	—		*			1						$	—					—
Residential mortgage-backed			11						74						—			*			2
Commercial mortgage-backed			1						2						—						—
Total			$	12					77						$	—		*			2
(1) Primarily U.S. dollar denominated.
*Less than $1
			Nine Months Ended September 30,
			2022												2021
			Impairment						No. of Securities						Impairment						No. of Securities
Foreign corporate public securities and foreign governments (1)			$	—		*			1						$	—					—
Residential mortgage-backed			20						85						—			*			10
Commercial mortgage-backed			1						3						—			*			1
Total			$	21					89						$	—		*			11
(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 pre-modification recovery assessment. For the three months and nine months ended September 30, 2022, the Company had no new commercial mortgage loan troubled debt restructurings. For the three months ended September 30, 2022, the Company had no new private placement troubled debt restructurings. For the nine months ended September 30, 2022, the Company had six new private placement troubled debt restructurings with a pre and post modification carrying value of $ 102 and $ 75 , respectively. For the three months ended September 30, 2021, the Company did not have any commercial mortgage loan

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troubled debt restructurings. For the nine months ended September 30, 2021, the Company had one commercial mortgage loan trouble 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 not have any private placement troubled debt restructurings.

For the three and nine months ended September 30, 2022 and September 30, 2021, 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.

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, 2022 and December 31, 2021, respectively.

			As of September 30, 2022
			Loan-to-Value Ratios
Year of Origination			0 % - 50 %						> 50 % - 60 %						> 60 % - 70 %						> 70 % - 80 %						> 80 % and above						Total
2022			$	160					$	261					$	64					$	—					$	—					$	485
2021			245						281						239						9						—						774
2020			114						228						25						10						—						377
2019			197						142						29						—						—						368
2018			163						43						2						—						—						208
2017			626						202						4						—						—						832
2016 and prior			2,040						302						22						—						—						2,364
Total			$	3,545					$	1,459					$	385					$	19					$	—					$	5,408

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			As of December 31, 2021
			Loan-to-Value Ratios
Year of Origination			0 % - 50 %						> 50 % - 60 %						> 60 % - 70 %						> 70 % - 80 %						> 80 % and above						Total
2021			$	269					$	315					$	201					$	—					$	—					$	785
2020			140						240						77						—						—						457
2019			201						192						69						—						—						462
2018			169						50						2						—						—						221
2017			656						214						4						—						—						874
2016 and prior			2,220						584						24						—						—						2,828
Total			$	3,655					$	1,595					$	377					$	—					$	—					$	5,627

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, 2022 and December 31, 2021, respectively.

			As of September 30, 2022
			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												Total*
2022			$	314					$	56					$	115					$	—											$	485
2021			361						221						101						91												774
2020			271						20						30						56												377
2019			243						47						53						25												368
2018			132						25						51						—												208
2017			490						80						81						181												832
2016 and prior			1,752						362						153						97												2,364
Total			$	3,563					$	811					$	584					$	450											$	5,408

*No commercial mortgage loans were secured by land or construction loans

			As of December 31, 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												Total*
2021			$	652					$	27					$	38					$	68											$	785
2020			396						21						34						6												457
2019			278						49						108						27												462
2018			131						5						54						31												221
2017			414						156						111						193												874
2016 and prior			2,237						242						242						107												2,828
Total			$	4,108					$	500					$	587					$	432											$	5,627

*No commercial mortgage loans were secured by land or construction loans

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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, 2022 and December 31, 2021, respectively.

			As of September 30, 2022
			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
2022			$	60					$	117					$	30					$	85					$	104					$	65					$	4					$	1					$	19					$	485
2021			98						72						136						141						111						138						9						47						22						774
2020			74						170						18						16						25						40						—						7						27						377
2019			58						122						10						77						47						5						15						13						21						368
2018			50						62						56						10						14						10						—						6						—						208
2017			124						92						330						136						54						55						5						36						—						832
2016 and prior			670						543						460						115						179						204						44						114						35						2,364
Total			$	1,134					$	1,178					$	1,040					$	580					$	534					$	517					$	77					$	224					$	124					$	5,408

			As of December 31, 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			$	98					$	79					$	143					$	137					$	110					$	140					$	9					$	47					$	22					$	785
2020			84						187						31						35						39						39						3						14						25						457
2019			59						145						14						130						47						17						15						13						22						462
2018			54						68						59						10						14						10						—						6						—						221
2017			128						94						360						139						56						56						5						36						—						874
2016 and prior			718						617						590						159						256						239						71						142						36						2,828
Total			$	1,141					$	1,190					$	1,197					$	610					$	522					$	501					$	103					$	258					$	105					$	5,627

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, 2022 and December 31, 2021, respectively.

			As of September 30, 2022
			Property Type
Year of Origination			Retail						Industrial						Apartments						Office						Hotel/Motel						Other						Mixed Use						Total
2022			$	24					$	219					$	217					$	15					$	10					$	—					$	—					$	485
2021			38						170						415						124						—						18						9						774
2020			58						61						106						152						—						—						—						377
2019			46						86						176						47						13						—						—						368
2018			37						85						56						12						—						18						—						208
2017			107						397						180						145						3						—						—						832
2016 and prior			796						395						524						373						67						157						52						2,364
Total			$	1,106					$	1,413					$	1,674					$	868					$	93					$	193					$	61					$	5,408

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			As of December 31, 2021
			Property Type
Year of Origination			Retail						Industrial						Apartments						Office						Hotel/Motel						Other						Mixed Use						Total
2021			$	39					$	185					$	405					$	129					$	—					$	18					$	9					$	785
2020			58						90						140						169						—						—						—						457
2019			46						96						211						82						27						—						—						462
2018			38						88						57						16						4						18						—						221
2017			110						417						195						149						3						—						—						874
2016 and prior			936						566						576						398						93						205						54						2,828
Total			$	1,227					$	1,442					$	1,584					$	943					$	127					$	241					$	63					$	5,627

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

			September 30, 2022						December 31, 2021
Allowance for credit losses, beginning of period			$	15					$	89
Credit losses on mortgage loans for which credit losses were not previously recorded			1						1
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			( 3 )						( 61 )
Provision for expected credit losses			13						15
Write-offs			—						—
Recoveries of amounts previously written-off			—						—
Allowance for credit losses, end of period			$	13					$	15

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

			September 30, 2022						December 31, 2021
Delinquency:
Current			$	5,408					$	5,627
30-59 days past due			—						—
60-89 days past due			—						—
Greater than 90 days past due			—						—
Total			$	5,408					$	5,627

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, 2022 and December 31, 2021, the Company had no 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, 2022 and year ended December 31, 2021.

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Net Investment Income

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

			Three Months Ended September 30,												Nine Months Ended September 30,
			2022						2021						2022						2021
Fixed maturities			$	483					$	501					$	1,457					$	1,513
Equity securities			( 3 )						4						6						15
Mortgage loans on real estate			58						59						177						184
Policy loans			5						7						16						18
Short-term investments and cash equivalents			3						2						6						7
Limited partnerships and other			( 10 )						175						115						415
Gross investment income			536						748						1,777						2,152
Less: Investment expenses			14						17						44						51
Net investment income			$	522					$	731					$	1,733					$	2,101

As of September 30, 2022, the Company had $ 16 of investments in fixed maturities that did not produce net investment income. As of December 31, 2021, the Company had no investments in fixed maturities that did not produce net investment income. Fixed maturities are moved to a non-accrual status when the investment defaults.

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 Gains (Losses)

Net 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 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.

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

			Three Months Ended September 30,
			2022						2021
Fixed maturities, available-for-sale, including securities pledged			$	8					$	6
Fixed maturities, at fair value option			( 294 )						( 137 )
Equity securities, at fair value			( 7 )						1
Derivatives			174						11
Embedded derivatives - fixed maturities			( 2 )						( 1 )
Guaranteed benefit derivatives			( 5 )						1
Mortgage loans			( 1 )						14
Other investments			4						2
Net gains (losses)			$	( 123 )					$	( 103 )
			Nine Months Ended September 30,
			2022						2021
Fixed maturities, available-for-sale, including securities pledged			$	( 71 )					$	1,789
Fixed maturities, at fair value option			( 844 )						( 514 )
Equity securities, at fair value			( 39 )						12
Derivatives			300						( 5 )
Embedded derivatives - fixed maturities			( 8 )						( 6 )
Guaranteed benefit derivatives			13						49
Mortgage Loans			4						177
Other investments			10						100
Net gains (losses)			$	( 635 )					$	1,602

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 gains (losses) in the Condensed Consolidated Statements of Operations.

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,
			2022						2021						2022 (1)						2021
Proceeds on sales			$	1,138					$	369					$	3,358					$	10,582
Gross gains			30						22						60						1,733
Gross losses			19						1						63						3
(1) Decrease from prior year is the result of the transfer of assets to support the life reinsurance transaction with Resolution.

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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, 2022																		December 31, 2021
			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			$	82					$	2					$	—					$	94					$	2					$	—
Cash flow hedges:
Interest rate contracts			22						—						—						22						—						—
Foreign exchange contracts			700						126						—						683						16						16
Derivatives: Non-qualifying for hedge accounting (1)
Interest rate contracts			19,370						358						371						13,382						147						209
Foreign exchange contracts			159						7						3						146						1						3
Equity contracts			245						2						6						299						4						2
Credit contracts			177						—						3						135						1						1
Embedded derivatives and Managed custody guarantees:
Within fixed maturity investments (2)			N/A						3						—						N/A						12						—
Within products (3)			N/A						—						24						N/A						—						47
Within reinsurance agreements (4)			N/A						109						74						N/A						—						196
Managed custody guarantees (3)			N/A						—						9						N/A						—						1
Total									$	607					$	490											$	183					$	475

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

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

(3) Included in Future policy benefits on the Condensed Consolidated Balance Sheets.

(4) Included in Other liabilities, Other assets, and Premium receivable and reinsurance recoverable on the Condensed Consolidated Balance Sheets.

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, 2022 and December 31, 2021. 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, 2022
			Notional Amount						Asset Fair Value						Liability Fair Value
Credit contracts			$	177					$	—					$	3
Equity contracts			197						1						6
Foreign exchange contracts			941						135						3
Interest rate contracts			13,439						353						370
									489						382
Counterparty netting (1)									( 310 )						( 310 )
Cash collateral netting (1)									( 121 )						( 63 )
Securities collateral netting (1)									( 11 )						( 1 )
Net receivables/payables									$	47					$	8

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

			December 31, 2021
			Notional Amount						Asset Fair Value						Liability Fair Value
Credit contracts			$	135					$	1					$	1
Equity contracts			239						4						2
Foreign exchange contracts			923						19						19
Interest rate contracts			12,003						147						209
									171						231
Counterparty netting (1)									( 156 )						( 156 )
Cash collateral netting (1)									( 12 )						( 70 )
Securities collateral netting (1)									( 2 )						( 2 )
Net receivables/payables									$	1					$	3

(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, 2022, the Company held $ 127 and pledged $ 61 of net cash collateral related to OTC derivative contracts and cleared derivative contracts, respectively. As of December 31, 2021, the Company held $ 17 and pledged $ 71 of net cash collateral related to OTC derivative contracts and cleared derivative contracts, respectively. In addition, as of September 30, 2022, the Company delivered $ 149 of securities and held $ 11 of securities as collateral. As of December 31, 2021, the Company delivered $ 124 of securities and held $ 2 of 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 periods indicated:

			Three Months Ended September 30,
			2022												2021
			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 gains/(losses)						Net investment income						Net investment income and Other net gains/(losses)
Amount of Gain or (Loss) Recognized in Other Comprehensive Income			$	—					$	64					$	—					$	24
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income			—						4						—						3
			Nine Months Ended September 30,
			2022												2021
			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 gains/(losses)						Net investment income						Net investment income and Other net gains/(losses)
Amount of Gain or (Loss) Recognized in Other Comprehensive Income			$	( 2 )					$	126					$	( 1 )					$	36
Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income			—						9						—						2

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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,
			2022												2021
			Net investment income						Other net gains/(losses)						Net investment income						Other net 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			$	522					$	( 111 )					$	731					$	( 103 )
Derivatives: Qualifying for hedge accounting
Fair value hedges:
Foreign exchange contracts:
Hedged items			—						( 6 )						—						( 2 )
Derivatives designated as hedging instruments (1)			—						6						—						2
Cash flow hedges:
Foreign exchange contracts:
Gain (loss) reclassified from accumulated other comprehensive income into income			4						—						3						—
			Nine Months Ended September 30,
			2022												2021
			Net investment income						Other net gains/(losses)						Net investment income						Other net 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			$	1,733					$	( 614 )					$	2,101					$	1,602
Derivatives: Qualifying for hedge accounting
Fair value hedges:
Foreign exchange contracts:
Hedged items			—						( 13 )						—						( 3 )
Derivatives designated as hedging instruments (1)			—						14						—						3
Cash flow hedges:
Foreign exchange contracts:
Gain (loss) reclassified from accumulated other comprehensive income into income			9						—						7						( 5 )

(1) For the three months ended September 30, 2022, 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 earning. For the nine months ended September 30, 2022, $ 1 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 earning. For the three and nine months ended September 30, 2021, 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 earning.

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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,
									2022						2021
Derivatives: Non-qualifying for hedge accounting
Interest rate contracts			Other net gains (losses)						$	176					$	10
Foreign exchange contracts			Other net gains (losses)						—						—
Equity contracts			Other net gains (losses)						( 8 )						( 1 )
Credit contracts			Other net gains (losses)						—						—
Embedded derivatives and Managed custody guarantees:
Within fixed maturity investments			Other net gains (losses)						( 2 )						( 1 )
Within products			Other net gains (losses)						1						7
Within reinsurance agreements (1)			Policyholder benefits						57						18
Managed custody guarantees			Other net gains (losses)						( 6 )						( 1 )
Total									$	218					$	32
			Location of Gain or (Loss) Recognized in Income on Derivative						Nine Months Ended September 30,
									2022						2021
Derivatives: Non-qualifying for hedge accounting
Interest rate contracts			Other net gains (losses)						$	328					$	( 13 )
Foreign exchange contracts			Other net gains (losses)						( 2 )						( 2 )
Equity contracts			Other net gains (losses)						( 36 )						11
Credit contracts			Other net gains (losses)						( 4 )						1
Embedded derivatives and Managed custody guarantees:
Within fixed maturity investments			Other net gains (losses)						( 8 )						( 6 )
Within products			Other net gains (losses)						23						38
Within reinsurance agreements (1)			Policyholder benefits						233						41
Managed custody guarantees			Other net gains (losses)						( 8 )						3
Total									$	526					$	73

(1) For the three and nine months ended September 30, 2022, the amount excluded gains (losses) of $( 3 ) and $( 2 ), respectively, from standalone derivatives recognized in Other net gains (losses). For the three and nine months ended September 30, 2021, the amount excluded gains (losses) of $( 1 ) and $ 3 , respectively, from standalone derivatives recognized in Other net 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, 2022:

			Level 1						Level 2						Level 3						Total
Assets:
Fixed maturities, including securities pledged:
U.S. Treasuries			$	516					$	216					$	—					$	732
U.S. Government agencies and authorities			—						49						—						49
State, municipalities and political subdivisions			—						864						—						864
U.S. corporate public securities			—						8,800						15						8,815
U.S. corporate private securities			—						2,839						1,743						4,582
Foreign corporate public securities and foreign governments (1)			—						2,854						—						2,854
Foreign corporate private securities (1)			—						2,654						404						3,058
Residential mortgage-backed securities			—						3,956						26						3,982
Commercial mortgage-backed securities			—						4,009						—						4,009
Other asset-backed securities			—						2,022						72						2,094
Total fixed maturities, including securities pledged			516						28,263						2,260						31,039
Equity securities			134						8						195						337
Derivatives:
Interest rate contracts			5						353						—						358
Foreign exchange contracts			—						135						—						135
Equity contracts			1						1						—						2
Embedded derivative on reinsurance			—						109						—						109
Cash and cash equivalents, short-term investments and short-term investments under securities loan agreements			2,035						3						—						2,038
Assets held in separate accounts			70,169						5,472						339						75,980
Total assets			$	72,860					$	34,344					$	2,794					$	109,998
Percentage of Level to total			66		%				31		%				3		%				100		%
Liabilities:
Derivatives:
Guaranteed benefit derivatives (2)			—						—						33						33
Other derivatives:
Interest rate contracts			—						371						—						371
Foreign exchange contracts			—						3						—						3
Equity contracts			—						6						—						6
Credit contracts			—						3						—						3
Embedded derivative on reinsurance			—						( 15 )			(3)			89						74
Total liabilities			$	—					$	368					$	122					$	490

(1) Primarily U.S. dollar denominated.

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

(3) The Company classifies the embedded derivative within liabilities given the underlying nature of the balance and the right-of-offset.

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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, 2021:

			Level 1						Level 2						Level 3						Total
Assets:
Fixed maturities, including securities pledged:
U.S. Treasuries			$	745					$	258					$	—					$	1,003
U.S. Government agencies and authorities			—						81						—						81
State, municipalities and political subdivisions			—						1,111						—						1,111
U.S. corporate public securities			—						11,925						16						11,941
U.S. corporate private securities			—						3,415						1,910						5,325
Foreign corporate public securities and foreign governments (1)			—						3,723						—						3,723
Foreign corporate private securities (1)			—						3,148						353						3,501
Residential mortgage-backed securities			—						4,259						43						4,302
Commercial mortgage-backed securities			—						4,183						—						4,183
Other asset-backed securities			—						2,037						44						2,081
Total fixed maturities, including securities pledged			745						34,140						2,366						37,251
Equity securities			37						—						203						240
Derivatives:
Interest rate contracts			—						147						—						147
Foreign exchange contracts			—						19						—						19
Equity contracts			—						4						—						4
Credit contracts			—						1						—						1
Cash and cash equivalents, short-term investments and short-term investments under securities loan agreements			2,525						82						—						2,607
Assets held in separate accounts			94,943						5,174						316						100,433
Total assets			$	98,250					$	39,567					$	2,885					$	140,702
Percentage of Level to total			70		%				28		%				2		%				100		%
Liabilities:
Derivatives:
Guaranteed benefit derivatives (2)			—						—						48						48
Other derivatives:
Interest rate contracts			—						209						—						209
Foreign exchange contracts			—						19						—						19
Equity contracts			—						2						—						2
Credit contracts			—						1						—						1
Embedded derivative on reinsurance			—						109						87						196
Total liabilities			$	—					$	340					$	135					$	475

(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"), Overnight Index Swap ("OIS") rates, and Secured Overnight Financing Rate ("SOFR"). The Company uses SOFR discounting for valuations of interest rate derivatives; however, certain legacy positions may continue to be discounted on OIS. 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 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. 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, 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 tables summarize the change in fair value of the Company's Level 3 assets and liabilities and transfers in and out of Level 3 for the periods indicated:

			Three Months Ended September 30, 2022
			Fair Value as of July 1						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			$	19					$	—					$	( 1 )					$	3					$	—					$	—					$	( 1 )					$	—					$	( 5 )					$	15					$	—					$	—
U.S. corporate private securities			1,780						( 2 )						( 94 )						77						—						—						( 40 )						22						—						1,743						( 2 )						( 95 )
Foreign corporate public securities and foreign governments (1)			4						—						—						—						—						—						—						—						( 4 )						—						—						—
Foreign corporate private securities (1)			403						( 2 )						( 11 )						22						—						—						( 4 )						—						( 4 )						404						( 2 )						( 11 )
Residential mortgage-backed securities			31						( 4 )						—						2						—						—						—						—						( 3 )						26						( 4 )						—
Other asset-backed securities			63						—						( 2 )						21						—						—						( 1 )						—						( 9 )						72						( 1 )						( 2 )
Total fixed maturities, including securities pledged			2,300						( 8 )						( 108 )						125						—						—						( 46 )						22						( 25 )						2,260						( 9 )						( 108 )
Equity securities, at fair value			203						( 8 )						—						—						—						—						—						—						—						195						( 8 )						—
Derivatives:
Guaranteed benefit derivatives (2)(5)			( 29 )						( 5 )						—						—						—						—						1						—						—						( 33 )						—						—
Embedded derivatives on reinsurance			( 86 )						( 3 )						—						—						—						—						—						—						—						( 89 )						—						—
Assets held in separate accounts (4)			349						( 9 )						—						32						—						( 16 )						—						—						( 17 )						339						—						—

(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 (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 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, 2022
			Fair Value as of January 1						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			$	16					$	—					$	( 1 )					$	7					$	—					$	—					$	( 1 )					$	—					$	( 6 )					$	15					$	—					$	( 1 )
U.S. corporate private securities			1,910						( 4 )						( 374 )						235						—						—						( 159 )						145						( 10 )						1,743						( 4 )						( 373 )
Foreign corporate private securities (1)			353						( 23 )						( 42 )						115						—						—						( 33 )						148						( 114 )						404						( 6 )						( 42 )
Residential mortgage-backed securities			43						( 19 )						—						4						—						—						—						—						( 2 )						26						( 19 )						—
Other asset-backed securities			44						( 1 )						( 6 )						52						—						( 10 )						( 7 )						—						—						72						( 1 )						( 6 )
Total fixed maturities, including securities pledged			2,366						( 47 )						( 423 )						413						—						( 10 )						( 200 )						293						( 132 )						2,260						( 30 )						( 422 )
Equity securities, at fair value			203						( 35 )						—						27						—						—						—						—						—						195						( 35 )						—
Derivatives:
Guaranteed benefit derivatives (2)(5)			( 48 )						15						—						—						( 1 )						—						1						—						—						( 33 )						—						—
Embedded derivatives on reinsurance			( 87 )						( 2 )						—						—						—						—						—						—						—						( 89 )						—						—
Cash and cash equivalents, short-term investments and short-term investments under securities loan agreements			—						—						—						8						—						—						( 8 )						—						—						—						—						—
Assets held in separate accounts (4)			316						( 35 )						—						164						—						( 20 )						—						6						( 92 )						339						—						—

(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 (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 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, 2021
			Fair Value as of July 1						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 )						—						—
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 (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 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.

---

---

For the three and nine months ended September 30, 2022 and 2021, 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 Condensed 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, 2022												December 31, 2021
			Carrying Value						Fair Value						Carrying Value						Fair Value
Assets:
Fixed maturities, including securities pledged			$	31,039					$	31,039					$	37,251					$	37,251
Equity securities			337						337						240						240
Mortgage loans on real estate			5,408						5,061						5,627						5,982
Policy loans			368						368						392						392
Cash, cash equivalents, short-term investments and short-term investments under securities loan agreements			2,038						2,038						2,607						2,607
Derivatives			495						495						171						171
Embedded derivative on reinsurance			109						109						—						—
Other investments			71						71						79						79
Assets held in separate accounts			75,980						75,980						100,433						100,433
Liabilities:
Investment contract liabilities:
Funding agreements without fixed maturities and deferred annuities (1)			$	36,263					$	36,488					$	35,334					$	43,407
Funding agreements with fixed maturities			1,369						1,367						1,460						1,461
Supplementary contracts, immediate annuities and other			746						650						829						775
Derivatives:
Guaranteed benefit derivatives (2)			33						33						48						48
Other derivatives			383						383						231						231
Embedded derivative on reinsurance			74						74						196						196
Short-term debt			141						142						1						1
Long-term debt			2,094						1,932						2,595						2,991

(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 MCGs.

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
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:

			2022
			DAC						VOBA						Total
Balance as of January 1, 2022			$	1,217					$	161					$	1,378
Deferrals of commissions and expenses			84						4						88
Amortization:
Amortization, excluding unlocking (2)			( 182 )						( 28 )						( 210 )
Unlocking (1)			( 29 )						( 15 )						( 44 )
Interest accrued			73						24			(3)			97
Net amortization included in Condensed Consolidated Statements of Operations			( 138 )						( 19 )						( 157 )
Change due to unrealized capital gains/(losses) on available-for-sale securities			933						652						1,585
Balance as of September 30, 2022			$	2,096					$	798					$	2,894
			2021
			DAC						VOBA						Total
Balance as of January 1, 2021			$	1,440					$	70					$	1,510
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

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

(2) There was no loss recognition during 2022. During 2021, the Company recorded loss recognition of $ 351 and $ 87 for DAC and VOBA, respectively.

(3) Interest accrued at the following rates for VOBA: 3.5 % to 7.2 % during 2022 and 2021.

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Information regarding the effect of reinsurance on the Condensed Consolidated Balance Sheets is as follows as of the periods indicated:

			September 30, 2022
			Direct						Assumed						Ceded						Total, Net of Reinsurance
Assets
Premiums receivable			$	178					$	10					$	( 209 )					$	( 21 )
Reinsurance recoverable, net of allowance for credit losses			—						—						13,582						13,582
Total			$	178					$	10					$	13,373					$	13,561
Liabilities
Future policy benefits and contract owner account balances			$	52,445					$	1,056					$	—					$	53,501
Liability for funds withheld under reinsurance agreements			102						—						—						102
Total			$	52,547					$	1,056					$	—					$	53,603

			December 31, 2021
			Direct						Assumed						Ceded						Total, Net of Reinsurance
Assets
Premiums receivable			$	169					$	8					$	( 213 )					$	( 36 )
Reinsurance recoverable			—						—						13,671						13,671
Total			$	169					$	8					$	13,458					$	13,635
Liabilities
Future policy benefits and contract owner account balances			$	51,648					$	1,110					$	—					$	52,758
Liability for funds withheld under reinsurance agreements			203						—						—						203
Total			$	51,851					$	1,110					$	—					$	52,961

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Information regarding the effect of reinsurance on the Condensed Consolidated Statements of Operations is as follows for the periods indicated:

			Three Months Ended September 30,
			2022						2021
Premiums:
Direct premiums			$	815					$	756
Reinsurance assumed			6						8
Reinsurance ceded			( 214 )						( 191 )
Net premiums			$	607					$	573
Fee income:
Gross fee income			$	533					$	587
Reinsurance assumed			5						4
Reinsurance ceded			( 103 )						( 104 )
Net fee income			$	435					$	487
Interest credited and other benefits to contract owners / policyholders:
Direct interest credited and other benefits to contract owners / policyholders			$	1,474					$	1,227
Reinsurance assumed			13						16
Reinsurance ceded			( 937 )						( 529 )
Net interest credited and other benefits to contract owners / policyholders			$	550					$	714

			Nine Months Ended September 30,
			2022						2021
Premiums:
Direct premiums			$	2,443					$	2,288
Reinsurance assumed			19						22
Reinsurance ceded			( 647 )						( 6,208 )
Net premiums			$	1,815					$	( 3,898 )
Fee income:
Gross fee income			$	1,576					$	1,684
Reinsurance assumed			14						13
Reinsurance ceded			( 311 )						( 316 )
Net fee income			$	1,279					$	1,381
Interest credited and other benefits to contract owners / policyholders:
Direct interest credited and other benefits to contract owners / policyholders			$	3,428					$	4,231
Reinsurance assumed			35						57
Reinsurance ceded			( 1,605 )						( 7,078 )
Net interest credited and other benefits to contract owners / policyholders			$	1,858					$	( 2,790 )

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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, 2022, common stock reserved and available for issuance under the 2013 Omnibus Plan, the 2014 Omnibus Plan and the 2019 Omnibus Plan was 347,663 , 3,050,166 and 7,756,078 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,
			2022						2021						2022						2021
Restricted Stock Unit (RSU) awards			$	8					$	8					$	38					$	34
Performance Stock Unit (PSU) awards			6						10						37						40
Stock options			—						—						—						1
Total share-based compensation expense			14						18						75						75
Income tax benefit			3						4						21						19
After-tax share-based compensation expense			$	11					$	14					$	54					$	56

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, 2022			1.4						$	57.53																	2.0						$	54.05
Adjustment for PSU performance factor			—						—																		0.2						59.13
Granted			0.8						65.32																		0.9						56.67
Vested			( 0.7 )						56.65																		( 0.9 )						50.28
Forfeited			—			*			61.14																		( 0.1 )						54.42
Outstanding as of September 30, 2022			1.5						$	60.84																	2.1						$	55.69

*Less than 0.1

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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, 2022			1.8						$	42.91
Granted			—						—
Exercised			( 0.1 )						40.68
Forfeited			—						—
Outstanding as of September 30, 2022			1.7						$	43.07
Vested, exercisable, as of September 30, 2022			1.7						$	43.07

Noncontrolling Interest

Noncontrolling interest in limited partnerships increased from $ 1,568 at December 31, 2021 to $ 1,590 at September 30, 2022 as a result of an increase in net contributions and consolidation of one additional fund, partially offset by unfavorable market depreciation in limited partnership investments. See the Consolidated and Nonconsolidated Investment Entities Note to these Condensed Consolidated Financial Statements for additional details over changes in noncontrolling interest during the year and impacting Shareholders' Equity.

Redeemable Noncontrolling Interest

At September 30, 2022, the Company had a redeemable noncontrolling interest of $ 155 associated with Allianz's 24 % economic stake in Newco. This redeemable noncontrolling interest has been classified as mezzanine equity because in the event of a change in control of the Company, which is not solely within the control of the Company, the redeemable noncontrolling interest could become redeemable for cash or other assets at the option of the holder. A change in control of the Company is not considered probable as of September 30, 2022. Therefore, the redeemable noncontrolling interest has not been remeasured to its redemption value.

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, 2021			143.3						19.1						124.2
Common shares issued			0.1						—						0.1
Common shares acquired - share repurchase			—						17.9						( 17.9 )
Share-based compensation			2.4						1.0						1.4
Treasury Stock retirement			( 36.8 )						( 36.8 )						—
Balance, December 31, 2021			109.0						1.2						107.8
Common shares issued			—			*			—						—
Common shares acquired - share repurchase			—						11.7						( 11.7 )
Share-based compensation			1.7						0.6						1.1
Balance, September 30, 2022			110.7						13.5						97.2

*less than 0.1

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

			Three Months Ended September 30,												Nine Months Ended September 30,
			2022						2021						2022						2021
Dividends declared per share of Common Stock			$	0.20					$	0.165					$	0.60					$	0.495

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 April 28, 2022, 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 . The share repurchase authorization expires on June 30, 2023 (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, 2022.

2022
Execution Date						Payment						Initial Shares Delivered						Closing Date						Additional Shares Delivered						Total Shares Repurchased
June 21, 2022						$	250					3,382,950						September 20, 2022						819,566						4,202,516
March 17, 2022						$	275					3,305,786						May 11, 2022						890,112						4,195,898

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, 2022, the Company paid a quarterly dividend of $ 0.20 per share on its common stock. As a consequence, the exercise price of the warrants to purchase shares of common stock was adjusted to $ 47.07 per share of common stock and the number of shares of common stock for which each warrant is exercisable has been adjusted to 1.035601267 . As of September 30, 2022, no warrants have been exercised.

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Preferred Stock

As of September 30, 2022 and December 31, 2021, there were 100,000,000 shares of preferred stock authorized. Preferred stock issued and outstanding are as follows:

									September 30, 2022															December 31, 2021
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
2022						$	30.625					$	10					$	13.375					$	4
2021						30.625						10						13.375						4
Nine Months Ended September 30,
2022						$	61.250					$	20					$	40.125					$	12
2021						61.250						20						40.125						12

As of September 30, 2022, 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)			2022						2021						2022						2021
Earnings
Net income (loss) available to common shareholders:
Income (loss) from continuing operations			$	69					$	371					$	296					$	2,373
Less: Preferred stock dividends			14						14						32						32
Less: Net income (loss) attributable to noncontrolling interest and redeemable noncontrolling interest			( 138 )						214						( 20 )						661
Income (loss) from continuing operations available to common shareholders			193						143						284						1,680
Income (loss) from discontinued operations, net of tax			—						( 1 )						—						7
Net income (loss) available to common shareholders			$	193					$	142					$	284					$	1,687
Weighted average common shares outstanding
Basic			97.9						113.4						101.9						118.8
Dilutive Effect:
Warrants			6.2						6.7						7.2						6.5
RSU awards			0.9						1.0						0.9						1.0
PSU awards			0.9						0.7						0.8						0.8
Stock Options			0.5						0.6						0.6						0.7
Diluted			106.4						122.4						111.4						127.8
Basic (1)
Income (loss) from continuing operations available to Voya Financial, Inc.'s common shareholders			$	1.98					$	1.25					$	2.79					$	14.13
Income (loss) from discontinued operations, net of taxes available to Voya Financial, Inc.'s common shareholders			$	—					$	( 0.01 )					$	—					$	0.06
Income (loss) available to Voya Financial, Inc.'s common shareholders			$	1.98					$	1.24					$	2.79					$	14.19
Diluted (1)
Income (loss) from continuing operations available to Voya Financial, Inc.'s common shareholders			$	1.82					$	1.16					$	2.55					$	13.14
Income (loss) from discontinued operations, net of taxes available to Voya Financial, Inc.'s common shareholders			$	—					$	( 0.01 )					$	—					$	0.05
Income (loss) available to Voya Financial, Inc.'s common shareholders			$	1.82					$	1.15					$	2.55					$	13.19

(1) 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 AOCI as of the dates indicated:

			September 30,
			2022						2021
Fixed maturities, net of impairment			$	( 3,669 )					$	3,521
Derivatives (1)			187						82
DAC/VOBA adjustment on available-for-sale securities (2)			817						( 821 )			(3)
Premium deficiency reserve adjustment (2)			—						( 15 )
Other intangibles adjustment on available-for-sale securities (2)			( 8 )						5
Unrealized capital gains (losses), before tax			( 2,673 )						2,772
Deferred income tax asset (liability)			684						( 459 )
Net unrealized capital gains (losses)			( 1,989 )						2,313
Pension and other postretirement benefits liability, net of tax			3						3
AOCI			$	( 1,986 )					$	2,316

(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, 2022, the portion of the AOCI that is expected to be reclassified into earnings within the next 12 months is $ 19 .

(2) Upon adoption of ASU 2018-12 on January 1, 2023, the DAC/VOBA adjustments on available-for-sale securities, Premium deficiency reserve adjustment and Other intangibles adjustment on available-for-sale securities will be reversed as of the January 1, 2021 transition date and in subsequent periods.

(3) In connection with the closing of the Individual Life Transaction on January 4, 2021, the Company released stranded AOCI and reversed unrealized capital gains (losses) on available-for-sale securities associated with DAC for the disposed entities. In addition, the Company released the unrealized gains for the investments transferred associated with the reinsurance transactions entered into at closing.

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, 2022
			Before-Tax Amount						Income Tax (Benefit)						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	( 1,743 )					$	367					$	( 1,376 )
Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations			( 1 )						—						( 1 )
DAC/VOBA			395						( 83 )						312
Other intangibles			( 4 )						1						( 3 )
Change in unrealized gains (losses) on available-for-sale securities			( 1,353 )						285						( 1,068 )
Derivatives:
Derivatives			63			(1)			( 14 )						49
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			58						( 13 )						45
Change in Accumulated other comprehensive income (loss)			$	( 1,295 )					$	272					$	( 1,023 )

(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, 2022
			Before-Tax Amount						Income Tax (Benefit)						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	( 6,954 )					$	1,461					$	( 5,493 )
Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations			89						( 19 )						70
DAC/VOBA			1,585			(1)			( 333 )						1,252
Premium deficiency reserve adjustment			14						( 3 )						11
Other intangibles			( 13 )						3						( 10 )
Change in unrealized gains (losses) on available-for-sale securities			( 5,279 )						1,109						( 4,170 )
Derivatives:
Derivatives			122			(2)			( 26 )						96
Adjustments related to effective cash flow hedges for amounts recognized in Net investment income in the Condensed Consolidated Statements of Operations			( 15 )						3						( 12 )
Change in unrealized gains (losses) on derivatives			107						( 23 )						84
Change in Accumulated other comprehensive income (loss)			$	( 5,172 )					$	1,086					$	( 4,086 )

(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

			Three Months Ended September 30, 2021
			Before-Tax Amount						Income Tax (Benefit)						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	( 196 )					$	41					$	( 155 )
Other			( 2 )						—						( 2 )
Adjustments for amounts recognized in Net gains (losses) in the Condensed Consolidated Statements of Operations			( 22 )						4						( 18 )
DAC/VOBA			56						( 12 )						44
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
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 (Benefit)						After-Tax Amount
Available-for-sale securities:
Fixed maturities			$	( 3,295 )					$	461					$	( 2,834 )
Other			( 2 )						—						( 2 )
Adjustments for amounts recognized in Net 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
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.

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 and nine months ended September 30, 2022 was 31.7 % and 14.2 %. The effective tax rate differed from the statutory rate of 21 % primarily due to the effect of the dividends received deduction ("DRD"), tax credits and noncontrolling interest.

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 DRD.

In August 2022, the Inflation Reduction Act ("IRA of 2022") was signed into law creating the corporate alternative minimum tax ("CAMT"). The IRA of 2022 has tasked the U.S. Department of Treasury with issuing regulations at a future date. As these

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regulations have not yet been issued, the Company is uncertain as to whether it will qualify for the CAMT and will continue to evaluate the applicability as more guidance is provided.

Valuation allowances are provided when it is considered more likely than not that some portion or all of the deferred tax assets ("DTAs") will not be realized. The Company reviews all available positive and negative evidence to determine if a valuation allowance is recorded, including historical and projected pre-tax book income, tax planning strategies and reversals of temporary differences. As of September 30, 2022, the Company had year-to-date losses on securities of $ 5,172 in Other comprehensive income primarily driven by increases in interest rates. The Company determined that the increase in unrealized losses on fixed income investments will be offset in future years by the ordinary income produced from these investments as they reach maturity. Additionally, operating income remained positive for the period and was largely consistent with the 2021 year-end valuation allowance analysis. After evaluating the positive and negative evidence, the Company did not change its judgement regarding the realization of DTAs. For more information related to the valuation allowance, refer to the Income Taxes Note to the Consolidated Financial Statements included in Part II, Item 8 of the Annual Report on form 10-K .

Tax Regulatory Matters

For the tax years 2020 through 2022, 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 2020 tax year, 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 that tax year.

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, 2022 and December 31, 2021:

			Issuer						Maturity						September 30, 2022						December 31, 2021
3.65 % Senior Notes, due 2026 (2)(3)			Voya Financial, Inc.						06/15/2026						$	445					$	445
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 (4)			Voya Financial, Inc.						01/23/2048						336						345
5.65 % Fixed-to-Floating Rate Junior Subordinated Notes, due 2053 (4)			Voya Financial, Inc.						05/15/2053						388						740
7.25 % Voya Holdings Inc. debentures, due 2023 (1)			Voya Holdings, Inc.						08/15/2023						140						140
7.63 % Voya Holdings Inc. debentures, due 2026 (1)			Voya Holdings, Inc.						08/15/2026						139						139
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						13
1.00 % Windsor Property Loan			Voya Retirement Insurance and Annuity Company						06/14/2027						3						3
Subtotal															2,235						2,596
Less: Current portion of long-term debt															141						1
Total															$	2,094					$	2,595

(1) Guaranteed by ING Group.

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

(3) Guaranteed by Voya Holdings.

(4) See the Junior Subordinated Notes section below.

As of September 30, 2022, the Company was in compliance with its debt covenants.

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Aetna Notes

As of September 30, 2022, the outstanding principal amount of the Aetna Notes was $ 358 , which is guaranteed by ING Group. As of September 30, 2022, the Company provided $ 365 of collateral benefiting ING Group, comprised of a deposit of $ 202 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.

Junior Subordinated Notes

During the nine months ended September 30, 2022, the Company repurchased $ 357 par value of its 5.65 % Fixed-to-Floating Rate Junior Subordinated Note, due 2053, on the open market, resulting in loss on debt extinguishment of $ 5 , which is included in Interest expense on the Condensed Consolidated Statements of Operations.

During the nine months ended September 30, 2022, the Company repurchased $ 10 par value of its 4.7 % Fixed-to-Floating Rate Junior Subordinated Note, due 2048, on the open market, resulting in gain on debt extinguishment of $ 1 , which is included in Interest expense on the Condensed Consolidated Statements of Operations.

Senior Unsecured Credit Facility Agreement

As of September 30, 2022, 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, 2022, 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 $ 6,150 , which may increase upon any future equity issuances by the Company.

Leases

During the nine months ended September 30, 2022, the Company recorded an impairment of $ 3 on its right-of-use asset associated with leased office space, which is included in Operating expenses in the Condensed Consolidated Statements of Operations. There was no impairment on the Company's right-of-use asset associated with leased office space during the three months ended September 30, 2022.

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, 2022, the Company had off-balance sheet commitments to acquire mortgage loans of $ 147 and purchase limited partnerships and private placement investments of $ 1,054 , of which $ 398 related to consolidated investment entities.

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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, 2022						December 31, 2021
Fixed maturity collateral pledged to FHLB (1)			$	1,678					$	1,881
FHLB restricted stock (2)			71						78
Other fixed maturities-state deposits			34						46
Cash and cash equivalents			31						31
Securities pledged (3)			1,123						1,198
Total restricted assets			$	2,937					$	3,234

(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 $ 854 and $ 969 as of September 30, 2022 and December 31, 2021, respectively. In addition, as of September 30, 2022 and December 31, 2021, the Company delivered securities as collateral of $ 149 and $ 124 and repurchase agreements of $ 120 and $ 105 , respectively. Loaned securities and securities delivered as collateral are included in Securities pledged on the Condensed Consolidated Balance Sheets.

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, 2022 and December 31, 2021, the Company had $ 1,369 and $ 1,461 respectively, in non-putable funding agreements, which are included in Contract owner account balances on the Condensed Consolidated Balance Sheets. As of September 30, 2022 and December 31, 2021, assets with a market value of approximately $ 1,678 and $ 1,881 , 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.

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.

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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, 2022, 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.

Litigation includes Henkel of America v. ReliaStar Life Insurance Company, et al. (USDC District of Connecticut, No. 1:18cv-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. The Company denies the allegations, which it believes are without merit, and intends to defend the case vigorously.

Litigation also includes Ravarino, et al. v. Voya Financial, Inc., et al. (USDC District of Connecticut, No. 3:21-cv-01658)(filed December 14, 2021). In this putative class action, the plaintiffs allege that the named defendants breached their fiduciary duties of prudence and loyalty in the administration of the Voya 401(k) Savings Plan. The plaintiffs claim that the named defendants did not exercise proper prudence in their management of allegedly poorly performing investment options, including proprietary funds, and passed excessive investment-management and other administrative fees for proprietary and non-proprietary funds onto plan participants. The plaintiffs also allege that the defendants engaged in self-dealing through the inclusion of the Voya Stable Value Option into the plan offerings and by setting the “crediting rate” for participants’ investment in the Stable Value Fund artificially low in relation to Voya’s general account investment returns in order to maximize the spread and Voya’s profits at the participants’ expense. The complaint seeks disgorgement of unjust profits as well as costs incurred. 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. On March 29, 2022, the district court granted the Plaintiff’s motion for class certification and denied the Company’s motion for summary judgment. The Company denies the allegations in the complaint, believes the complaint to be without merit, and will defend the lawsuit vigorously.

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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, 2022, approximately $ 129 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 $ 286 and $ 317 as of September 30, 2022 and December 31, 2021, 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.

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 invests in the subordinated debt of entities formed to be the issuers of CLO offerings during their warehouse periods. The Company’s investments in these CLOs are repaid when the CLOs’ warehouse periods are closed and the CLO offerings are issued. The Company performs ongoing monitoring of the consolidation assessment for CLOs during and after their warehouse periods to determine if Voya remains the primary beneficiary of the CLOs. 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 8 and 7 CLOs as of September 30, 2022 and December 31, 2021, respectively. The one additional CLO was consolidated during the first half of 2022 with impacts reflected within the Cash and cash equivalents, Corporate loans, at fair value using the fair value option, CLO notes, at fair value using the fair value option, and Other liabilities within the CIE sections of the Company's Condensed Consolidated Balance Sheets. There was no impact to the Company's Condensed Consolidated Statements of Operations during the three and nine months ended September 30, 2022.

Limited Partnerships ("LPs")

The Company invests in and manages various limited partnerships, including private equity funds and hedge funds. The LPs generally have a ten-year life and have specified period during which investors can subscribe for limited partnership interests. Once the investors are admitted as limited partners, the investors are required to contribute capital when called by the general

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partners. The purpose of the LPs is to obtain subscriptions from limited partners and maximize the return to their partners by assembling a diversified portfolio of investments in private equity funds and other securities or assets with similar risk and return characteristics primarily through secondary market purchases. The majority of the investors in the LPs are unrelated parties to the Company. In return for subscriptions, each partner receives an equity interest in the LPs in proportion to its respective investment. 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 12 and 11 funds, which were structured as partnerships, as of September 30, 2022 and December 31, 2021, respectively. The one additional fund was consolidated during the three months ended September 30, 2022 with impacts reflected within the Limited partnerships/corporations, at fair value, Cash and cash equivalents, Other assets, and Other liabilities within the CIEs sections of the Company's Condensed Consolidated Balance Sheets, the Net investment income and Other expense within the CIEs sections of the Company's Condensed Consolidated Statements of Operations during the three and nine months ended September 30, 2022.

The noncontrolling interest related to these partnerships increased from $ 1,568 at December 31, 2021 to $ 1,590 at September 30, 2022. Changes in market value, contributions, and distributions related to these investments in partnerships directly impact the noncontrolling interest component of Shareholders' Equity on the Company's Condensed Consolidated Balance Sheets. The change in noncontrolling interest was primarily driven by an increase in net contributions and consolidation of one additional fund, partially offset by unfavorable market depreciation in limited partnership investments. The Company records the noncontrolling interest using a lag methodology relying on the most recent financial information available.

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The following table summarizes the components of the consolidated investment entities as of the dates indicated:

			September 30, 2022						December 31, 2021
Assets of Consolidated Investment Entities
VIEs
Cash and cash equivalents			$	95					$	171
Corporate loans, at fair value using the fair value option			1,161						1,111
Limited partnerships/corporations, at fair value			2,879						2,469
Other assets			60						28
Total VIE assets			4,195						3,779
Total assets of consolidated investment entities			$	4,195					$	3,779
Liabilities and Shareholders' Equity of Consolidated Investment Entities
VIEs
CLO notes, at fair value using the fair value option			$	1,028					$	880
Other liabilities			1,291						1,013
Total VIE liabilities			2,319						1,893
Total liabilities of consolidated investment entities			2,319						1,893
Noncontrolling interest			1,590						1,568
Total VIE shareholders' equity			1,590						1,568
Total liabilities and shareholders' equity of consolidated investment entities			$	3,909					$	3,461

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.

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.

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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 2040, paying interest at LIBOR , SOFR , EURIBOR or PRIME plus a spread of up to 10.0 %. As of September 30, 2022 and December 31, 2021, the unpaid principal balance exceeded the fair value of the corporate loans by approximately $ 61 and $ 8 , respectively. Less than 1.0 % of the collateral assets were in default as of September 30, 2022 and December 31, 2021.

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 1.0 % for the more senior tranches to 8.8 % 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, 2022. 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.

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).

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• 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, 2022 and December 31, 2021, certain private equity funds maintained term loans and revolving lines of credit of $ 1,203 and $ 1,214 , 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 - 200 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, 2022 and December 31, 2021, outstanding borrowings amount to $ 1,113 and $ 697 , 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, 2022:

			Level 1						Level 2						Level 3						NAV						Total
Assets
Cash and cash equivalents			$	95					$	—					$	—					$	—					$	95
Corporate loans, at fair value using the fair value option			—						1,161						—						—						1,161
Limited partnerships/corporations, at fair value			—						—						—						2,879						2,879
Total assets, at fair value			$	95					$	1,161					$	—					$	2,879					$	4,135
Liabilities
CLO notes, at fair value using the fair value option			$	—					$	1,028					$	—					$	—					$	1,028
Total liabilities, at fair value			$	—					$	1,028					$	—					$	—					$	1,028

The following table summarizes the fair value hierarchy levels of consolidated investment entities as of December 31, 2021:

			Level 1						Level 2						Level 3						NAV						Total
Assets
Cash and cash equivalents			$	171					$	—					$	—					$	—					$	171
Corporate loans, at fair value using the fair value option			—						1,111						—						—						1,111
Limited partnerships/corporations, at fair value			—						—						—						2,469						2,469
Total assets, at fair value			$	171					$	1,111					$	—					$	2,469					$	3,751
Liabilities
CLO notes, at fair value using the fair value option			$	—					$	880					$	—					$	—					$	880
Total liabilities, at fair value			$	—					$	880					$	—					$	—					$	880

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, 2022 and 2021, there were no transfers in or out of Level 3 or transfers between Level 1 and Level 2.

Deconsolidation of Certain Investment Entities

Certain investment entities that have historically been consolidated in the financial statements may require deconsolidation as of the reporting period because: (a) such funds have been liquidated or dissolved; or (b) the Company is no longer deemed to be the primary beneficiary of the VIEs as it no longer has a controlling financial interest.

The change in CLO’s consolidation status due to the close of the warehouse and the launch of the CLO do not meet the criteria described above as this transaction represents normal business operations of the entity. Refer to the CLO life cycle described above.

During the three and nine months ended September 30, 2022 and 2021, the Company had no deconsolidations.

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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, 2022 and December 31, 2021, the Company held $ 374 and $ 415 ownership interests, respectively, in unconsolidated CLOs, which also represents the Company's maximum exposure to loss.

LPs

As of September 30, 2022 and December 31, 2021, the Company held $ 1,783 and $ 1,739 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 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, RRII, MUL and VAE to Resolution Life US, which is an insurance holding company newly formed by 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 2022, o f $ 15 to $ 25 in addition to the $ 91 incurred during 2021 and $ 22 incurred for the nine months ended September 30, 2022.

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 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.

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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)
			2022						2021									2022						2021
Severance benefits			$	( 2 )					$	5								$	—					$	19		$	84
Organizational transition costs			5						19									22						57			414
Total restructuring expenses			$	3					$	24								$	22					$	76		$	498
Continuing operations			$	3					$	24								$	22					$	76		$	433
Discontinued operations			$	—					$	—								$	—					$	—		$	65

(1) Includes expenses incurred during 2017-2022.

The following table presents the accrued liability associated with Organizational Restructuring expenses as of September 30, 2022:

			Severance Benefits																		Organizational Transition Costs						Total
Accrued liability as of January 1, 2022			$	30																	$	22					$	52
Provision			—																		22						22
Payments			( 8 )																		( 39 )						( 47 )
Accrued liability as of September 30, 2022			$	22																	$	5					$	27

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, Health Solutions and Investment Management.

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 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

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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 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 the gains and (losses) of consolidated entities, such as Allianz's stake in the results of VIM Holdings LLC (referred to as redeemable noncontrolling interest and Allianz noncontrolling interest) 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,
			2022						2021						2022						2021
Income (loss) from continuing operations before income taxes			$	101					$	411					$	345					$	2,477
Less Adjustments:
Net investment gains (losses) and related charges and adjustments			( 5 )						( 1 )						( 144 )						66
Net guaranteed benefit gains (losses) and related charges and adjustments			( 8 )						( 3 )						( 27 )						2
Income (loss) related to businesses exited or to be exited through reinsurance or divestment			( 14 )						( 173 )						( 111 )						798
Income (loss) attributable to noncontrolling interest			( 138 )						214						( 20 )						661
Income (loss) related to early extinguishment of debt			1						—						( 3 )						( 10 )
Immediate recognition of net actuarial gains (losses) related to pension and other post-employment benefit obligations and gains (losses) from plan amendments and curtailments			—						—						4						—
Dividend payments made to preferred shareholders			14						14						32						32
Other adjustments			( 47 )						( 28 )						( 116 )						( 86 )
Total adjustments to income (loss) from continuing operations			$	( 197 )					$	22					$	( 385 )					$	1,463
Adjusted operating earnings before income taxes by segment:
Wealth Solutions			$	168					$	319					$	560					$	869
Health Solutions			149						71						217						171
Investment Management			51						63						129						180
Corporate			( 57 )						( 65 )						( 163 )						( 207 )
Total including Allianz noncontrolling interest			$	311					$	388					$	743					$	1,014
Less: Earnings (loss) attributable to Allianz noncontrolling interest			12						—						12						—
Total			$	299					$	388					$	730					$	1,014

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;

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• 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;

• 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,
			2022						2021						2022						2021
Total revenues			$	1,338					$	2,009					$	4,371					$	2,555
Adjustments:
Net investment gains (losses) and related charges and adjustments			( 9 )						( 5 )						( 166 )						( 44 )
Gains (losses) on change in fair value of derivatives related to guaranteed benefits			( 8 )						( 3 )						( 27 )						2
Revenues related to businesses exited or to be exited through reinsurance or divestment			( 38 )						57						( 143 )						( 3,356 )
Revenues attributable to noncontrolling interest			( 130 )						228						11						697
Other adjustments			30						44						66						358
Total adjustments to revenues			$	( 156 )					$	320					$	( 258 )					$	( 2,343 )
Adjusted operating revenues by segment:
Wealth Solutions			$	643					$	857					$	2,103					$	2,446
Health Solutions			646						606						1,933						1,796
Investment Management			192						200						542						582
Corporate			13						25						51						73
Total			$	1,494					$	1,689					$	4,629					$	4,898

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,
			2022						2021						2022						2021
Investment Management intersegment revenues			$	23					$	23					$	68					$	68

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

			September 30, 2022						December 31, 2021
Wealth Solutions			$	110,324					$	137,544
Health Solutions			2,751						3,002
Investment Management			1,532						1,226
Corporate			25,532						26,025
Total assets, before consolidation (1)			140,139						167,797
Consolidation of investment entities			3,909						3,465
Total assets			$	144,048					$	171,262

(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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