2 unchanged sentences
Consolidated Statements of Earnings
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions, except for share and per-share amounts - Unaudited) 2023 2022 2023 2022
30 unchanged sentences
Consolidated Statements of Comprehensive Income (Loss)
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions - Unaudited) 2023 2022 2023 2022
20 unchanged sentences
Consolidated Balance Sheets
−Removed: (In millions, except for share and per-share amounts - Unaudited) March 31,
+Added: (In millions, except for share and per-share amounts - Unaudited) June 30,
Investments and cash:
57 unchanged sentences
Balance at December 31, 2022
+Added: $ 135 $ 2,641 $ 44,367 $ ( 6,429 ) $ ( 20,574 ) $ 20,140
Net earnings 0 0 1,188 0 0 1,188
18 unchanged sentences
Balance at March 31, 2023 $ 135 $ 2,665 $ 45,555 $ ( 7,278 ) $ ( 21,293 ) $ 19,784
+Added: Net earnings 0 0 1,634 0 0 1,634
+Added: Unrealized foreign currency translation
+Added: gains (losses) during period, net of
+Added: income taxes 0 0 0 ( 631 ) 0 ( 631 )
+Added: Unrealized gains (losses) on fixed maturity
+Added: securities during period, net of income
+Added: taxes and reclassification adjustments 0 0 0 689 0 689
+Added: Unrealized gains (losses) on derivatives
+Added: during period, net of income taxes 0 0 0 1 0 1
+Added: Effect of changes in discount rate assumptions
+Added: during period, net of income taxes 0 0 0 ( 165 ) 0 ( 165 )
+Added: Pension liability adjustment during period,
+Added: net of income taxes 0 0 0 46 0 46
+Added: Dividends to shareholders (1)
+Added: ($ .42 per share)
+Added: 0 0 ( 252 ) 0 0 ( 252 )
+Added: Exercise of stock options 0 5 0 0 0 5
+Added: Share-based compensation 1 17 0 0 0 18
+Added: Purchases of treasury stock 0 0 0 0 ( 708 ) ( 708 )
+Added: Treasury stock reissued 0 10 0 0 8 18
+Added: Balance at June 30, 2023 $ 136 $ 2,697 $ 46,937 $ ( 7,338 ) $ ( 21,993 ) $ 20,439
+Added: (1) Dividends to shareholders are recorded in the period in which they are declared.
+Added: Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration insurance contracts.
+Added: See the accompanying Notes to the Consolidated Financial Statements.
+Added: Aflac Incorporated and Subsidiaries
+Added: Consolidated Statements of Shareholders’ Equity (continued)
(In millions, except for per share amounts - Unaudited) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Shareholders'
Balance at December 31, 2021
+Added: $ 135 $ 2,529 $ 40,963 $ ( 8,411 ) $ ( 18,185 ) $ 17,031
Net earnings 0 0 1,047 0 0 1,047
18 unchanged sentences
Balance at March 31, 2022 $ 135 $ 2,560 $ 42,010 $ ( 8,451 ) $ ( 18,694 ) $ 17,560
+Added: Net earnings 0 0 1,394 0 0 1,394
+Added: Unrealized foreign currency translation
+Added: gains (losses) during period, net of
+Added: income taxes 0 0 0 ( 780 ) 0 ( 780 )
+Added: Unrealized gains (losses) on fixed maturity
+Added: securities during period, net of income
+Added: taxes and reclassification adjustments 0 0 0 ( 2,857 ) 0 ( 2,857 )
+Added: Unrealized gains (losses) on derivatives
+Added: during period, net of income taxes 0 0 0 0 0 0
+Added: Effect of changes in discount rate assumptions
+Added: during period, net of income taxes 0 0 0 5,105 0 5,105
+Added: Pension liability adjustment during period,
+Added: net of income taxes 0 0 0 3 0 3
+Added: Dividends to shareholders (1)
+Added: ($ .40 per share)
+Added: 0 0 ( 254 ) 0 0 ( 254 )
+Added: Exercise of stock options 0 1 0 0 0 1
+Added: Share-based compensation 0 19 0 0 0 19
+Added: Purchases of treasury stock 0 0 0 0 ( 650 ) ( 650 )
+Added: Treasury stock reissued 0 9 0 0 8 17
+Added: Balance at June 30, 2022 $ 135 $ 2,589 $ 43,150 $ ( 6,980 ) $ ( 19,336 ) $ 19,558
(1) Dividends to shareholders are recorded in the period in which they are declared.
3 unchanged sentences
Consolidated Statements of Cash Flows
−Removed: Three Months Ended March 31,
+Added: Six Months Ended June 30,
(In millions - Unaudited) 2023 2022
14 unchanged sentences
Equity securities 244 398
+Added: Held-to-maturity fixed maturity securities 2 2
Commercial mortgage and other loans 728 1,270
13 unchanged sentences
Treasury stock reissued 5 10
−Removed: Other, net 41
Net cash provided (used) by financing activities ( 1,944 ) ( 1,644 )
36 unchanged sentences
are included in Corporate and other.
−Removed: Aflac Japan's revenues, including net gains and losses on its investment portfolio, accounted for 62 % and 70 % of the Company's total revenues in the three-month periods ended March 31, 2023 and 2022, respectively.
−Removed: The percentage of the Company's total assets attributable to Aflac Japan was 81 % at March 31, 2023, compared with 80 % at December 31, 2022.
+Added: Aflac Japan's revenues, including net gains and losses on its investment portfolio, accounted for 64 % and 69 % of the Company's total revenues in the six-month periods ended June 30, 2023 and 2022, respectively.
+Added: The percentage of the Company's total assets attributable to Aflac Japan was 80 % at June 30, 2023, compared with 80 % at December 31, 2022.
In 2022, the Company established Aflac Re Bermuda Ltd.
12 unchanged sentences
These accounting estimates and actuarial determinations are sensitive to market conditions, investment yields, interest rates, mortality, morbidity, commission and other acquisition expenses and terminations by policyholders.
−Removed: As additional information becomes available, or actual amounts are determinable, the recorded estimates are revised and reflected in operating results.
+Added: As additional information becomes available, or actual amounts are determinable, the recorded estimates are revised and reflected in the consolidated financial statements.
Although some variability is inherent in these estimates, the Company believes the amounts provided are reasonable and reflective of the best estimates of management.
1 unchanged sentence
All material intercompany accounts and transactions have been eliminated.
−Removed: In the opinion of management, the accompanying unaudited consolidated financial statements of the Company contain all adjustments, consisting of normal recurring accruals, which are necessary to fairly present the consolidated balance sheets as of March 31, 2023 and December 31, 2022, and the consolidated statements of earnings and comprehensive income (loss), shareholders' equity and cash flows for the three-month periods ended March 31, 2023 and 2022.
+Added: In the opinion of management, the accompanying unaudited consolidated financial statements of the Company contain all adjustments, consisting of normal recurring accruals, which are necessary to fairly present the consolidated balance sheets as of June 30, 2023 and December 31, 2022, the consolidated statements of earnings and comprehensive income (loss) for the three- and six-month periods ended June 30, 2023 and 2022, the consolidated statements of shareholders' equity for the three-month periods ended March 31, 2023 and 2022 and June 30, 2023 and 2022, and the consolidated statements of cash flows for the six-month periods ended June 30, 2023 and 2022.
Results of operations for interim periods are not necessarily indicative of results for the entire year.
−Removed: As a result, these financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2022 (2022 Annual Report).
+Added: As a result, these financial statements should be read
+Added: in conjunction with the financial statements and notes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2022 (2022 Annual Report).
Significant Accounting Policies
The Company revised the following accounting policies as a result of the adoption of amended accounting guidance effective January 1, 2023 and certain reclassifications.
−Removed: Refer to Recently Adopted Accounting Pronouncements below for details of the adoption of ASU 2018-12 Financial Services - Insurance:
+Added: Refer to Recently Adopted Accounting Pronouncements below for details of the adoption of Accounting Standards Update (ASU) 2018-12 Financial Services - Insurance:
Targeted Improvements to the Accounting for Long-Duration Contracts.
31 unchanged sentences
Amortization is computed using the same contract groupings (also referred to as cohorts) and mortality and termination assumptions that are used in computing the LFPB, and these assumptions are reviewed and updated at least annually.
−Removed: The effects of changes in assumptions are recognized prospectively over the remaining contract term as a revision of the future amortization pattern, while current period amortization is calculated based on the actual experience during the quarter.
+Added: The effects of changes in assumptions are recognized
+Added: prospectively over the remaining contract term as a revision of the future amortization pattern, while current period amortization is calculated based on the actual experience during the quarter.
Deferred costs include the excess of current-year commissions over ultimate renewal-year commissions and certain incremental direct policy issue, underwriting and sales expenses directly related to successful policy acquisition.
24 unchanged sentences
Discount rates used to calculate net premiums are locked in at policy inception and represent the basis to recognize interest expense in the consolidated statement of earnings.
−Removed: Discount rates used to measure the carrying value of the LFPB in the consolidated balance sheet are updated each reporting period, and the difference between the liability balances calculated using the locked-in discount rates and the updated discount rates is recognized in other comprehensive income (loss) (OCI).
+Added: Discount rates used to measure the carrying value of the LFPB in the consolidated balance sheet are updated each reporting period, and the difference between the liability balances calculated using the locked-in discount rates and the updated discount rates is recognized in accumulated other comprehensive income (loss) (AOCI).
The Company has designed its discount rate methodology for the U.S.
2 unchanged sentences
and Japan LFPBs, reflective of the characteristics of the insurance liabilities, such as currency and tenor.
−Removed: Discount rates comprising each curve are determined by reference to upper-medium grade (low credit risk) fixed-income instrument yields that
−Removed: reflect the duration characteristics of the corresponding insurance liabilities.
+Added: Discount rates comprising each curve are determined by reference to upper-medium grade (low credit risk) fixed-income instrument yields that reflect the duration characteristics of the corresponding insurance liabilities.
The Company uses for these yields single-A rated fixed income instruments with credit ratings based on international rating standards.
29 unchanged sentences
The Company calculated the LFPB using the Transition Date NPR (capped at 100 % if required) and two different discount rates:
−Removed: (i) the discount rate used immediately before the Transition Date, and (ii) the discount rate determined by reference to the Transition Date market level yields for upper-medium grade (low credit risk) fixed income instruments (as of December 31, 2020).
+Added: (i) the discount rate used immediately before the Transition Date, and (ii) the discount rate determined by reference to the Transition Date market level yields for upper-medium grade (low credit
+Added: risk) fixed income instruments (as of December 31, 2020).
For cohorts with their Transition Date NPR capped at 100 %, the Company recorded as an adjustment (decrease) to opening retained earnings any difference between the LFPB calculated using the discount rate immediately before the Transition Date and the existing carrying value as of the Transition Date.
−Removed: For all cohorts on the Transition Date, the Company recorded in accumulated other comprehensive
−Removed: income (AOCI) net of tax, the difference in the LFPB calculated using the two different discount rates (i.e., the discount rate used immediately before the Transition Date and the updated discount rate as of the Transition Date).
+Added: For all cohorts on the Transition Date, the Company recorded in AOCI net of tax, the difference in the LFPB calculated using the two different discount rates (i.e., the discount rate used immediately before the Transition Date and the updated discount rate as of the Transition Date).
Upon adoption, the Company adjusted opening equity for the Transition Date impacts to AOCI and retained earnings and adjusted prior periods presented (years 2021 and 2022) following the updated standard.
10 unchanged sentences
(In millions - Unaudited) Impact to Retained
−Removed: Earnings Impact to AOCI
+Added: Earnings Impact to
Transition impacts:
15 unchanged sentences
The Company adopted ASU 2018-12 using the modified retrospective transition method.
−Removed: The tables below present the disaggregated transition impacts to the Company’s LFPB as a result of adoption, split between the changes in the present
−Removed: value of expected net premiums and the present value of expected future policy benefits as of the Transition Date and the LFPB rollforward for the year ended December 31, 2021.
+Added: The tables below present the disaggregated transition impacts to the Company’s LFPB as a result of adoption, split between the changes in the present value of expected net premiums and the present value of expected future policy benefits as of the Transition Date and the LFPB rollforward for the year ended December 31, 2021.
The locked-in discount rates on the policies held at the Transition Date reflect the locked-in rates in existence immediately before the Transition Date.
113 unchanged sentences
Information regarding operations by reportable segment and Corporate and other, follows:
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions) 2023 2022 2023 2022
1 unchanged sentence
Adjusted net investment income (1),(2)
+Added: 637 723 1,248 1,402
Other income 9 9 18 18
2 unchanged sentences
Adjusted net investment income (3)
+Added: 203 193 400 377
Other income 35 41 70 83
Total adjusted revenue Aflac U.S.
+Added: 1,663 1,628 3,323 3,267
Corporate and other (4),(5)
+Added: 140 42 268 116
Total adjusted revenues 4,513 4,736 9,091 9,762
Net investment gains (losses) (1),(2),(3),(4)
+Added: 659 579 881 726
Total revenues $ 5,172 $ 5,315 $ 9,972 $ 10,488
−Removed: (1) Amortized hedge costs of $ 58 and $ 26 for the three-month periods ended March 31, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies have been reclassified from net investment gains (losses) and reported as a deduction from net investment income when analyzing operations.
−Removed: (2) Net interest cash flows from derivatives associated with certain investment strategies of $( 62 ) and $( 10 ) for the three-month periods ended March 31, 2023, and 2022, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
−Removed: (3) Net interest cash flows from derivatives associated with certain investment strategies of $( 7 ) and $ 1 for the three-month periods ended March 31, 2023, and 2022, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
−Removed: (4) Amortized hedge income of $ 29 and $ 11 for the three-month periods ended March 31, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies has been reclassified from net investment gains (losses) and reported as an increase to net investment income when analyzing operations.
−Removed: (5) The change in value of federal historic rehabilitation and solar investments in partnerships of $ 51 and $ 12 for the three-month periods ended March 31, 2023, and 2022, respectively, is included as a reduction to net investment income.
−Removed: Tax credits on these investments of $ 52 and $ 16 for the three-month periods ended March 31, 2023, and 2022, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
+Added: (1) Amortized hedge costs of $ 63 and $ 30 for the three-month periods and $ 122 and $ 55 for the six-month periods ended June 30, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies have been reclassified from net investment gains (losses) and reported as a deduction from net investment income when analyzing operations.
+Added: (2) Net interest cash flows from derivatives associated with certain investment strategies of $( 73 ) and $( 2 ) for the three-month periods and $( 135 ) and $( 12 ) for the six-month periods ended June 30, 2023, and 2022, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
+Added: (3) Net interest cash flows from derivatives associated with certain investment strategies of $( 8 ) and $ 1 for the three-month periods and $( 15 ) and $ 2 for the six-month periods ended June 30, 2023, and 2022, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
+Added: (4) Amortized hedge income of $ 38 and $ 14 for the three-month periods and $ 67 and $ 25 for the six-month periods ended June 30, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies has been reclassified from net investment gains (losses) and reported as an increase to net investment income when analyzing operations.
+Added: (5) The change in value of federal historic rehabilitation and solar investments in partnerships of $ 53 and $ 31 for the three-month periods and $ 105 and $ 42 for the six-month periods ended June 30, 2023, and 2022, respectively, is included as a reduction to net investment income.
+Added: Tax credits on these investments of $ 56 and $ 28 for the three-month periods and $ 108 and $ 44 for the six-month periods ended June 30, 2023, and 2022, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
See Note 3 of the Notes to the Consolidated Financial Statements for additional information on these investments.
Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration insurance contracts.
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions) 2023 2022 2023 2022
1 unchanged sentence
Aflac Japan (1),(2)
+Added: $ 822 $ 873 $ 1,610 $ 1,743
+Added: 369 343 721 675
Corporate and other (4),(5),(6)
+Added: ( 52 ) ( 75 ) ( 58 ) ( 117 )
Pretax adjusted earnings (7)
+Added: 1,139 1,141 2,273 2,301
Net investment gains (losses) (1),(2),(3),(4),(5)
+Added: 651 567 859 701
Other income (loss) 35 0 35 0
3 unchanged sentences
adjusted earnings ( 25 ) ( 59 ) ( 66 ) ( 94 )
−Removed: (1) Amortized hedge costs of $ 58 and $ 26 for the three-month periods ended March 31, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies have been reclassified from net investment gains (losses) and reported as a deduction from net investment income when analyzing operations.
−Removed: (2) Net interest cash flows from derivatives associated with certain investment strategies of $( 62 ) and $( 10 ) for the three-month periods ended March 31, 2023, and 2022, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
−Removed: (3) Net interest cash flows from derivatives associated with certain investment strategies of $( 7 ) and $ 1 for the three-month periods ended March 31, 2023, and 2022, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
−Removed: (4) Amortized hedge income of $ 29 and $ 11 for the three-month periods ended March 31, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies has been reclassified from net investment gains (losses) and reported as an increase in net investment income when analyzing operations.
−Removed: (5) A gain of $ 12 and $ 13 for the three-month periods ended March 31, 2023, and 2022, respectively, related to the interest rate component of the change in fair value of foreign currency swaps on notes payable has been reclassified from net investment gains (losses) and included in adjusted earnings when analyzing operations.
−Removed: (6) The change in value of federal historic rehabilitation and solar investments in partnerships of $ 51 and $ 12 for the three-month periods ended March 31, 2023, and 2022, respectively, is included as a reduction to net investment income.
−Removed: Tax credits on these investments of $ 52 and $ 16 for the three-month periods ended March 31, 2023, and 2022, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
+Added: (1) Amortized hedge costs of $ 63 and $ 30 for the three-month periods and $ 122 and $ 55 for the six-month periods ended June 30, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies have been reclassified from net investment gains (losses) and reported as a deduction from net investment income when analyzing operations.
+Added: (2) Net interest cash flows from derivatives associated with certain investment strategies of $( 73 ) and $( 2 ) for the three-month periods and $( 135 ) and $( 12 ) for the six-month periods ended June 30, 2023, and 2022, respectively, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
+Added: (3) Net interest cash flows from derivatives associated with certain investment strategies of $( 8 ) and $ 1 for the three-month periods and $( 15 ) and $ 2 for the six-month periods ended June 30, 2023, and 2022, have been reclassified from net investment gains (losses) and included in adjusted earnings as a component of net investment income when analyzing operations.
+Added: (4) Amortized hedge income of $ 38 and $ 14 for the three-month periods and $ 67 and $ 25 for the six-month periods ended June 30, 2023, and 2022, respectively, related to certain foreign currency exposure management strategies has been reclassified from net investment gains (losses) and reported as an increase in net investment income when analyzing operations.
+Added: (5) A gain of $ 12 and $ 12 for the three-month periods and $ 24 and $ 25 for the six-month periods ended June 30, 2023, and 2022, respectively, related to the interest rate component of the change in fair value of foreign currency swaps on notes payable has been reclassified from net investment gains (losses) and included in adjusted earnings when analyzing operations.
+Added: (6) The change in value of federal historic rehabilitation and solar investments in partnerships of $ 53 and $ 31 for the three-month periods and $ 105 and $ 42 for the six-month periods ended June 30, 2023, and 2022, respectively, is included as a reduction to net investment income.
+Added: Tax credits on these investments of $ 56 and $ 28 for the three-month periods and $ 108 and $ 44 for the six-month periods ended June 30, 2023, and 2022, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
See Note 3 of the Notes to the Consolidated Financial Statements for additional information on these investments.
−Removed: (7) Includes $ 34 and $ 41 for the three-month periods ended March 31, 2023, and 2022, respectively, of interest expense on debt.
+Added: (7) Includes $ 36 and $ 41 for the three-month periods and $ 70 and $ 82 for the six-month periods ended June 30, 2023, and 2022, respectively, of interest expense on debt.
Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration insurance contracts.
Assets were as follows:
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31,
6 unchanged sentences
The amortized cost for the Company's investments in fixed maturity securities, the cost for equity securities and the fair values of these investments are shown in the following tables.
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions)
47 unchanged sentences
Total securities available for sale $ 75,469 $ 0 $ 4,800 $ 4,528 $ 75,741
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions)
25 unchanged sentences
Total securities held to maturity $ 19,063 $ 7 $ 19,056 $ 2,154 $ 0 $ 21,210
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31, 2022
7 unchanged sentences
The methods of determining the fair values of the Company's investments in fixed maturity securities and equity securities are described in Note 5.
−Removed: During the first quarter of 2023 and 2022, respectively, the Company did not reclassify any investments from the held-to-maturity category to the available-for-sale category.
+Added: During the first six months of 2023 and 2022, respectively, the Company did not reclassify any investments from the held-to-maturity category to the available-for-sale category.
Contractual and Economic Maturities
−Removed: The contractual and economic maturities of the Company's investments in fixed maturity securities at March 31, 2023, were as follows:
+Added: The contractual and economic maturities of the Company's investments in fixed maturity securities at June 30, 2023, were as follows:
(In millions) Amortized
24 unchanged sentences
Investment exposures that individually exceeded 10% of shareholders' equity were as follows:
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Credit
6 unchanged sentences
Information regarding pretax net gains and losses from investments is as follows:
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions) 2023 2022 2023 2022
6 unchanged sentences
Other investments:
−Removed: Gross gains from sales 0 9
+Added: Gross gains (losses) from sales ( 3 ) 0 ( 3 ) 9
Total sales and redemptions 24 115 81 201
Equity securities ( 9 )
+Added: ( 135 ) ( 12 ) ( 291 )
Credit losses:
1 unchanged sentence
Commercial mortgage and other loans ( 2 ) ( 12 ) ( 33 ) 4
+Added: Impairment losses 0 ( 17 ) 0 ( 17 )
Loan commitments 1 ( 5 ) 4 2
6 unchanged sentences
Total net investment gains (losses) $ 555 $ 564 $ 678 $ 686
−Removed: The unrealized holding losses, net of gains, recorded as a component of net investment gains and losses for the three-month period ended March 31, 2023, that relate to equity securities still held at the March 31, 2023 reporting date, were $ 5 million.
+Added: The unrealized holding losses, net of gains, recorded as a component of net investment gains and losses for the three-month period ended June 30, 2023, that relate to equity securities still held at the June 30, 2023 reporting date, were $ 16 million.
+Added: The unrealized holding losses, net of gains, recorded as a component of net investment gains and losses for the six-month period ended June 30, 2023, that relate to equity securities still held at the June 30, 2023 reporting date, were $ 21 million.
Unrealized Investment Gains and Losses
1 unchanged sentence
The net effect on shareholders’ equity of unrealized gains and losses from fixed maturity securities was as follows:
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31,
3 unchanged sentences
Gross Unrealized Loss Aging
−Removed: The following tables show the fair values and gross unrealized losses of the Company's available-for-sale investments for the periods ended March 31, 2023 and December 31, 2022, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.
−Removed: March 31, 2023
+Added: The following tables show the fair values and gross unrealized losses of the Company's available-for-sale investments for the periods ended June 30, 2023 and December 31, 2022, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.
+Added: June 30, 2023
Total Less than 12 months 12 months or longer
61 unchanged sentences
The unrealized losses on the Company's fixed maturity securities investments have been primarily related to general market changes in interest rates, foreign exchange rates, and/or the levels of credit spreads rather than specific concerns with the issuer's ability to pay interest and repay principal.
−Removed: In the first quarter of 2023, interest rates for longer durations have declined which is the primary driver of the decrease in unrealized losses.
−Removed: However, compared to the prior year, interest rates have risen significantly which is the primary driver contributing to the increase in unrealized losses 12 months or longer.
+Added: In the first six months of 2023, the decrease in unrealized losses has been driven by improvements in credit spreads, which have been partially offset by interest rates which have increased along all durations in both the U.S.
For any of its fixed maturity securities with significant declines in fair value, the Company performs detailed analyses to identify whether the drivers of the declines are due to general market drivers, such as the recent rise in interest rates, or due to credit-related factors.
4 unchanged sentences
The Company utilizes information available in the public domain and, for certain private placement issuers, from consultations with the issuers directly.
−Removed: The Company also considers ratings from Nationally Recognized Statistical Rating Organizations (NRSROs), as well as the specific
−Removed: characteristics of the security it owns including seniority in the issuer's capital structure, covenant protections, or other relevant features.
+Added: The Company also considers ratings from Nationally Recognized Statistical Rating Organizations (NRSROs), as well as the specific characteristics of the security it owns including seniority in the issuer's capital structure, covenant protections, or other
+Added: relevant features.
From these reviews, the Company evaluates the issuers' continued ability to service the Company's investment through payment of interest and principal.
Assuming no credit-related factors develop, unrealized gains and losses on fixed maturity securities are expected to diminish as investments near maturity.
−Removed: Based on its credit analysis, the Company believes that the issuers of its fixed maturity investments in the sectors shown in the table above have the ability to service their obligations to the Company, and 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, which may be at maturity.
+Added: Based on its credit analysis, the Company believes that the issuers of its fixed maturity investments in the sectors shown in the table above have the ability to service their obligations to the Company.
+Added: Further, 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, which may be at maturity.
However, from time to time the Company identifies certain available-for-sale fixed maturity securities where the amortized cost basis exceeds the present value of the cash flows expected to be collected due to credit-related factors and as a result, a credit allowance will be estimated.
−Removed: Based on an evaluation of its securities currently in an unrealized loss position, the Company has determined that those securities had not incurred a credit loss and therefore, should not have a credit loss allowance as of March 31, 2023 .
+Added: Based on an evaluation of its securities currently in an unrealized loss position, the Company has determined that those securities had not incurred a credit loss and therefore, should not have a credit loss allowance as of June 30, 2023 .
Refer to the Allowance for Credit Losses section below for additional information.
+Added: As of June 30, 2023 and December 31, 2022, the Company had an immaterial amount of fixed maturity securities on nonaccrual status.
Commercial Mortgage and Other Loans
2 unchanged sentences
The following table reflects the composition of the carrying value for commercial mortgage and other loans by property type as of the periods presented.
−Removed: (In millions) March 31, 2023 December 31, 2022
+Added: (In millions) June 30, 2023 December 31, 2022
Amortized Cost % of Total Amortized Cost % of Total
24 unchanged sentences
These loans provide funding for properties undergoing a change in their physical characteristics and/or economic profile and do not typically require any principal repayment prior to the maturity date.
−Removed: As of March 31, 2023, the Company had $ 709 million in outstanding commitments to fund TREs.
+Added: As of June 30, 2023, the Company had $ 792 million in outstanding commitments to fund TREs.
These commitments are contingent on the final underwriting and due diligence to be performed.
5 unchanged sentences
These loans are generally considered to be below investment grade.
−Removed: The carrying value for MMLs included $ 21 million and $ 28 million for a short term credit facility that is reflected in other liabilities on the consolidated balance sheets, as of March 31, 2023, and December 31, 2022, respectively.
−Removed: As of March 31, 2023, the Company had commitments of approximately $ 748 million to fund future MMLs.
+Added: The carrying value for MMLs included $ 26 million and $ 28 million for a short term credit facility that is reflected in other liabilities on the consolidated balance sheets, as of June 30, 2023, and December 31, 2022, respectively.
+Added: As of June 30, 2023, the Company had commitments of approximately $ 726 million to fund future MMLs.
These commitments are contingent upon the availability of MMLs that meet the Company's underwriting criteria.
Credit Quality Indicators
−Removed: For TREs, the Company’s key credit quality indicator is loan-to-value (LTV).
+Added: For TREs, the Company’s key credit quality indicator is loan-to-value (LTV), which is calculated by dividing the current outstanding loan balance by the estimated property value at origination.
Given that TREs involve properties undergoing a repositioning of their commercial profile, LTV provides the most insight into the credit risk of the loan.
2 unchanged sentences
For CMLs, the Company’s key credit quality indicators include LTV and debt service coverage ratios (DSCR).
−Removed: LTV is calculated by dividing the current outstanding loan balance by the most recent estimated property value.
DSCR is the most recently available operating income of the underlying property compared to the required debt service of the loan.
4 unchanged sentences
The Company uses external credit ratings focused on the reinsurer’s financial strength and credit worthiness.
−Removed: As of March 31, 2023, the Company's reinsurance counterparties were rated A+.
+Added: As of June 30, 2023, the Company's reinsurance counterparties were rated A+.
The Company monitors the credit ratings periodically, but not less frequently than quarterly.
−Removed: The following tables present as of March 31, 2023 the amortized cost basis of TREs, CMLs and MMLs by year of origination and credit quality indicator.
+Added: The following tables present as of June 30, 2023 the amortized cost basis of TREs, CMLs and MMLs by year of origination and credit quality indicator.
Transitional Real Estate Loans
26 unchanged sentences
Loan Modifications
−Removed: The Company granted certain loan modifications in its MML and TRE portfolios during the three-month period ended March 31, 2023.
−Removed: As of March 31, 2023, these loan modifications did not have a material impact on the Company’s results of operations.
+Added: The Company granted certain loan modifications in its MML and TRE portfolios during the first six months of 2023.
+Added: As of June 30, 2023, these loan modifications did not have a material impact on the Company’s results of operations.
+Added: Past Due and Nonaccrual Loans
+Added: The Company designates nonaccrual status for a nonperforming loan or debt security or a loan that is not generating its stated interest rate because of nonpayment of periodic interest or principal by the borrower.
+Added: The Company applies the cash basis method to record any payments received on nonaccrual assets.
+Added: The Company resumes the accrual of interest on fixed maturity securities and loans that are currently making contractual payments or for those that are not current where the borrower has paid timely (less than 30 days outstanding).
+Added: The following table presents an aging of past due and nonaccrual loans at amortized cost, before allowance for credit losses, as of the period presented.
+Added: June 30, 2023
+Added: (In millions) Current Less Than 90 Days Past Due 90 Days
+Added: Total Past Due Total
+Added: Loans Nonaccrual Status
+Added: Transitional Real Estate Loans $ 6,141 $ 207 $ 427 $ 634 $ 6,775 $ 612
+Added: Commercial Mortgage Loans 1,756 0 0 0 1,756 0
+Added: Middle Market Loans 4,997 0 43 43 5,040 43
+Added: Total $ 12,894 $ 207 $ 470 $ 677 $ 13,571 $ 655
+Added: (1) As of June 30, 2023, there were no loans that were 90 days or more past due that continued to accrue interest
+Added: For the three-month and six-month periods ended June 30, 2023, the Company recognized no interest income for TREs, CMLs, or MMLs on nonaccrual status.
+Added: Of these loans, TREs with an amortized cost of $ 218 million had no credit loss allowance as of June 30, 2023, because these loans are collateral dependent assets for which the estimated fair values are in excess of amortized cost.
+Added: As of June 30, 2023, there were no MMLs on nonaccrual status without an allowance for credit losses.
+Added: As of December 31, 2022, the Company had an immaterial amount of loans on nonaccrual status.
Allowance for Credit Losses
2 unchanged sentences
The Company groups CMLs and TREs and respective loan commitments by property type, property location and the property’s LTV and DSCR.
+Added: On a quarterly basis, CMLs and TREs within a portfolio segment that share similar risk characteristics are pooled for calculation of credit loss allowance.
+Added: On an ongoing basis, TREs and CMLs with dissimilar risk characteristics (i.e., loans with significant declines in credit quality), such as collateral dependent mortgage loans (i.e., when the borrower is experiencing financial difficulty, including when foreclosure is probable), are evaluated individually for credit loss.
+Added: For example, the credit loss allowance for a collateral dependent loan is established as the excess of amortized cost over the estimated fair value of the loan’s underlying collateral, less selling cost when foreclosure is probable.
+Added: Accordingly, the change in the estimated fair value of collateral dependent loans, which are evaluated individually for credit loss, is recorded as a change in the credit loss allowance which is recorded on a quarterly basis as a charge or credit to earnings in net investment gains (losses).
The credit allowance for the reinsurance recoverable balance is estimated using a probability-of-default (PD) / loss-given-default (LGD) method.
The credit allowance for held-to-maturity fixed maturity securities and loan receivables is estimated using a PD / LGD method, discounted for the time value of money.
−Removed: For held-to-maturity fixed maturity securities, available-for-sale fixed
−Removed: maturity securities and loan receivables, the Company includes the change in present value due to the passage of time in the change in the allowance for credit losses.
+Added: For held-to-maturity fixed maturity securities, available-for-sale fixed maturity securities and loan receivables, the Company includes the change in present value due to the passage of time in the change in the allowance for credit losses.
The Company’s methodology for estimating credit losses utilizes the contractual maturity date of the financial asset, adjusted when necessary to reflect the expected timing of repayment (such as prepayment options, renewal options, call options, or extension options).
3 unchanged sentences
The Company continuously monitors the estimation methodology, due to changes in portfolio composition, changes in underwriting practices and significant events or conditions and makes adjustments as necessary.
−Removed: The Company’s held-to-maturity fixed maturity portfolio includes Japan Government and Agency securities of $ 18.0 billion amortized cost as of March 31, 2023 that meet the requirements for zero-credit-loss expectation and therefore these asset classes have been excluded from the current expected credit loss measurement.
+Added: The Company’s held-to-maturity fixed maturity portfolio includes Japan Government and Agency securities of $ 16.6 billion amortized cost as of June 30, 2023 that meet the requirements for zero-credit-loss expectation and therefore these asset classes have been excluded from the current expected credit loss measurement.
An investment in an available-for-sale fixed maturity security may be impaired if the fair value falls below amortized cost.
7 unchanged sentences
In addition, the Company evaluates the specific issuer’s probability of default and expected recovery of its position in the event of default based on the underlying financial condition and assets of the borrower as well as seniority and/or security of other debt holders in the issuer when developing management’s best estimate of expected cash flows.
−Removed: The Company designates nonaccrual status for a nonperforming loan or debt security or a loan that is not generating its stated interest rate because of nonpayment of periodic interest by the borrower.
−Removed: The Company applies the cash basis method to record any payments received on non-accrual assets.
−Removed: The Company resumes the accrual of interest on fixed maturity securities and loans that are currently making contractual payments or for those that are not current where the borrower has paid timely (less than 30 days outstanding).
−Removed: As of March 31, 2023 and December 31, 2022, the Company had an immaterial amount of loans and fixed maturity securities on nonaccrual status.
The following table presents the roll forward of the allowance for credit losses by portfolio segment.
(In millions) Transitional Real Estate Loans Commercial Mortgage Loans Middle Market Loans Held to Maturity Securities Available for Sale Securities Reinsurance Recoverables
−Removed: Three Months Ended March 31, 2023:
−Removed: Balance at December 31, 2022
+Added: Three Months Ended June 30, 2023:
+Added: Balance at March 31, 2023
$ ( 65 ) $ ( 9 ) $ ( 149 ) $ ( 6 ) $ 0 $ ( 11 )
3 unchanged sentences
Change in foreign exchange 0 0 0 1 0 1
+Added: Balance at June 30, 2023
+Added: $ ( 76 ) $ ( 9 ) $ ( 140 ) $ ( 5 ) $ 0 $ ( 10 )
+Added: Three Months Ended June 30, 2022:
Balance at March 31, 2022
$ ( 52 ) $ ( 8 ) $ ( 98 ) $ ( 8 ) $ 0 $ ( 9 )
−Removed: Three Months Ended March 31, 2022:
+Added: (Addition to) release of allowance for credit
+Added: losses ( 1 ) 0 ( 16 ) 0 0 0
+Added: Write-offs, net of recoveries 0 0 5 0 0 0
+Added: Change in foreign exchange 0 0 0 1 0 1
+Added: Balance at June 30, 2022
+Added: $ ( 53 ) $ ( 8 ) $ ( 109 ) $ ( 7 ) $ 0 $ ( 8 )
+Added: Six Months Ended June 30, 2023:
Balance at December 31, 2022
+Added: $ ( 54 ) $ ( 9 ) $ ( 129 ) $ ( 7 ) $ 0 $ ( 8 )
(Addition to) release of allowance for credit
losses ( 22 ) 0 ( 11 ) 1 0 ( 2 )
+Added: Write-offs, net of recoveries 0 0 0 0 0 0
Change in foreign exchange 0 0 0 1 0 0
−Removed: Balance at March 31, 2022
+Added: Balance at June 30, 2023
$ ( 76 ) $ ( 9 ) $ ( 140 ) $ ( 5 ) $ 0 $ ( 10 )
−Removed: During the first quarter of 2023, the Company identified certain TREs collateralized with commercial real estate properties with an amortized cost of $ 521 million in anticipation of potential foreclosure or deed-in lieu foreclosure transactions.
−Removed: The Company established a credit allowance of $ 10 million for those amortized loans of $ 345 million for which the fair value of the collateral was below the amortized cost of the loans.
+Added: Six Months Ended June 30, 2022:
+Added: Balance at December 31, 2021
+Added: $ ( 68 ) $ ( 10 ) $ ( 96 ) $ ( 8 ) $ 0 $ ( 13 )
+Added: (Addition to) release of allowance for credit
+Added: losses 15 2 ( 18 ) 0 0 2
+Added: Write-offs, net of recoveries 0 0 5 0 0 0
+Added: Change in foreign exchange 0 0 0 1 0 3
+Added: Balance at June 30, 2022
+Added: $ ( 53 ) $ ( 8 ) $ ( 109 ) $ ( 7 ) $ 0 $ ( 8 )
+Added: During the first six months of 2023, the Company identified certain TREs collateralized with commercial real estate properties with an amortized cost of $ 626 million in anticipation of potential foreclosure or deed-in lieu foreclosure transactions.
+Added: As of June 30, 2023, the Company established a credit allowance of $ 21 million for those amortized loans of $ 365 million for which the fair value of the collateral was below the amortized cost of the loans.
For assets that are subject to the credit loss measurement, the change in credit loss allowance will be significantly impacted by purchases and sales in those assets during the period as well as entering into new non-cancelable loan commitments.
−Removed: The estimate of credit losses for loan commitments as of March 31, 2023 was $ 21 million.
+Added: The estimate of credit losses for loan commitments as of June 30, 2023 was $ 20 million.
Other Investments
The table below reflects the composition of the carrying value for other investments as of the periods presented.
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31, 2022
9 unchanged sentences
Tax credits generated by these investments are recorded as an income tax benefit in the consolidated statement of earnings.
−Removed: As of March 31, 2023, the Company had $ 2.0 billion in outstanding commitments to fund alternative investments in limited partnerships.
+Added: As of June 30, 2023, the Company had $ 2.3 billion in outstanding commitments to fund alternative investments in limited partnerships.
Variable Interest Entities (VIEs)
10 unchanged sentences
Investments in Consolidated Variable Interest Entities
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Amortized
27 unchanged sentences
Investments in Variable Interest Entities Not Consolidated
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Amortized
8 unchanged sentences
The variable interests created by these VIEs are principally or solely a result of the debt instruments issued by them.
−Removed: The Company does not have the power to direct the activities that most significantly impact the entity's economic performance, nor does it have the obligation to absorb losses of the entity or the right to receive benefits from the entity.
+Added: The Company does not have the power to direct the activities that most significantly impact the entity's economic performance,
+Added: nor does it have the obligation to absorb losses of the entity or the right to receive benefits from the entity.
As such, the Company is not the primary beneficiary of these VIEs and is therefore not required to consolidate them.
15 unchanged sentences
Remaining Contractual Maturity of the Agreements
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Overnight
Continuous (1)
−Removed: days Total Overnight
+Added: days 30-90 days Total Overnight
Continuous (1)
−Removed: Securities lending transactions:
+Added: Securities lending
+Added: transactions:
Fixed maturity securities:
10 unchanged sentences
therefore, they are classified as Overnight and Continuous.
−Removed: In connection with securities lending, in addition to cash collateral received, the Company received from counterparties securities collateral of $ 5.9 billion and $ 6.8 billion at March 31, 2023 and December 31, 2022, respectively, which may not be sold or re-pledged, unless the counterparty is in default.
+Added: In connection with securities lending, in addition to cash collateral received, the Company received from counterparties securities collateral of $ 5.0 billion and $ 6.8 billion at June 30, 2023 and December 31, 2022, respectively, which may not be sold or re-pledged, unless the counterparty is in default.
Such securities collateral is not reflected on the consolidated financial statements.
−Removed: The Company did not have any repurchase agreements or repurchase-to-maturity transactions outstanding as of March 31, 2023, and December 31, 2022, respectively.
+Added: The Company did not have any repurchase agreements or repurchase-to-maturity transactions outstanding as of June 30, 2023, and December 31, 2022, respectively.
Certain fixed maturity securities can be pledged as collateral as part of derivative transactions, or pledged to support state deposit requirements on certain investment programs.
56 unchanged sentences
The notional amount of derivative contracts represents the basis upon which pay or receive amounts are calculated and are not reflective of exposure or credit risk.
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Asset
29 unchanged sentences
The Company has designated foreign currency swaps as a hedge of the variability in cash flows of a forecasted transaction or of amounts to be received or paid related to a recognized asset (“cash flow” hedge).
−Removed: The remaining maximum length of time for which these cash flows are hedged is approximately four years .
+Added: The remaining maximum length of time for which these cash flows are hedged is approximately three years .
The derivatives in the Company's consolidated VIEs that are not designated as accounting hedges are discussed in the "Non-qualifying Strategies" section of this note.
20 unchanged sentences
Net Investment Gains (Losses) Recognized for Fair Value Hedge
−Removed: Three Months Ended March 31, 2023:
+Added: Three Months Ended June 30, 2023:
Foreign currency options Fixed maturity securities $ ( 25 ) $ ( 25 ) $ 0 $ 0 $ 0
Total gains (losses) $ ( 25 ) $ ( 25 ) $ 0 $ 0 $ 0
−Removed: Three Months Ended March 31, 2022:
+Added: Six Months Ended June 30, 2023:
Foreign currency options Fixed maturity securities $ ( 64 ) $ ( 64 ) $ 0 $ 0 $ 0
Total gains (losses) $ ( 64 ) $ ( 64 ) $ 0 $ 0 $ 0
+Added: Three Months Ended June 30, 2022:
+Added: Foreign currency options Fixed maturity securities $ ( 11 ) $ ( 11 ) $ 0 $ 0 $ 0
+Added: Total gains (losses) $ ( 11 ) $ ( 11 ) $ 0 $ 0 $ 0
+Added: Six Months Ended June 30, 2022:
+Added: Foreign currency options Fixed maturity securities $ ( 26 ) $ ( 26 ) $ 0 $ 0 $ 0
+Added: Total gains (losses) $ ( 26 ) $ ( 26 ) $ 0 $ 0 $ 0
(1) Gains (losses) excluded from effectiveness testing includes the forward point on foreign currency forwards and time value change on foreign currency options which are reported in the consolidated statement of earnings as net investment gains (losses).
2 unchanged sentences
For interest rate swaptions and related hedged items, gains and losses included in the hedge assessment, premium amortization and time value amortization while the hedge items are still outstanding are reported within net investment income.
−Removed: The time value gains and losses for interest rate swaptions when the related hedged items are redeemed are reported in net investment gains and losses consistent with the impact of the hedged item.
−Removed: For the three-month periods ended March 31, 2023 and 2022, gains and losses included in the hedge assessment on interest rate swaptions and related hedged items were immaterial.
+Added: The time value gains and losses for interest rate swaptions when the related hedged items are redeemed are reported in net investment gains (losses) consistent with the impact of the hedged item.
+Added: For the three- and six-month periods ended June 30, 2023 and 2022, gains and losses included in the hedge assessment on interest rate swaptions and related hedged items were immaterial.
The following table shows the carrying amounts of assets designated and qualifying as hedged items in fair value hedges of interest rate risk and the related cumulative hedge adjustment included in the carrying amount.
+Added: The Company had no fair value hedges of interest rate risk as of June 30, 2023 and December 31, 2022;
+Added: therefore, the amounts presented in the table below are related to previous fair value hedges of interest rate risk that were discontinued.
(In millions) Carrying Amount of the Hedged Assets/(Liabilities) (1)
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of Hedged Assets/(Liabilities)
−Removed: 2023 December 31, 2022 March 31,
+Added: 2023 December 31, 2022 June 30,
2023 December 31, 2022
4 unchanged sentences
To mitigate this exposure, the Parent Company's yen-denominated liabilities (see Note 9) have been designated as non-derivative hedges and certain foreign currency forwards and options have been designated as derivative hedges of the foreign currency exposure of the Company's net investment in Aflac Japan.
−Removed: The Company's net investment hedge was effective during the three-month periods ended March 31, 2023 and 2022, respectively.
+Added: The Company's net investment hedge was effective during the three- and six-month periods ended June 30, 2023 and 2022, respectively.
Non-qualifying Strategies
2 unchanged sentences
While the change in value of the swaps is recorded through current period earnings, the change in value of the available-for-sale fixed maturity securities associated with these swaps is recorded through other comprehensive income.
−Removed: As of March 31, 2023, the Parent Company had $ 1.9 billion notional amount of cross-currency interest rate swap agreements related to certain of its U.S.
−Removed: dollar-denominated senior notes to effectively convert a portion of the interest on the notes from U.S dollar to Japanese yen.
+Added: As of June 30, 2023, the Parent Company had $ 1.2 billion notional amount of cross-currency interest rate swap agreements related to certain of its U.S.
+Added: dollar-denominated senior notes to effectively convert a portion of the interest on the notes from U.S.
+Added: dollar to Japanese yen.
Changes in the values of these swaps are recorded through current period earnings.
8 unchanged sentences
The following table summarizes the impact to earnings and other comprehensive income (loss) from all derivatives and hedging instruments.
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30,
(In millions) Net Investment Income (1)
15 unchanged sentences
Foreign currency options ( 25 ) ( 11 )
+Added: Total fair value hedges ( 25 ) ( 11 )
+Added: Net investment hedge:
+Added: Non-derivative hedging
+Added: instruments 0 313 0 324
+Added: Foreign currency forwards 37 393 ( 25 ) 522
+Added: Foreign currency options ( 5 ) 0 0 0
+Added: Total net investment hedge 32 706 ( 25 ) 846
+Added: Non-qualifying strategies:
+Added: Foreign currency swaps 2 107
+Added: Foreign currency swaps - VIE ( 63 ) ( 39 )
+Added: Foreign currency forwards ( 331 ) ( 473 )
+Added: Foreign currency options ( 18 ) ( 3 )
+Added: Interest rate swaps ( 189 ) ( 110 )
+Added: Forward bond purchase
+Added: commitment - VIE ( 1 ) ( 3 )
+Added: Total non- qualifying strategies ( 600 ) ( 521 )
+Added: Total $ 0 $ ( 594 ) $ 707 $ 0 $ ( 558 ) $ 846
+Added: (1) Interest expense/income on cash flow hedges are recorded in net investment income.
+Added: For interest rate swaptions classified as fair value hedges, the change in the time value of the swaptions is recognized in other comprehensive income (loss) and amortized into net investment income over its legal term.
+Added: If the swaption is early terminated but the hedge item is still outstanding, the amortization of disposal amount of the swaptions is recorded in net investment income over the remaining life of the hedged items.
+Added: (2) Gains and losses on cash flow hedges and the change in the fair value of interest rate swaptions related to the time value of the swaptions in fair value hedges are recorded as unrealized gains (losses).
+Added: Gains and losses on net investment hedges related to changes in foreign currency spot rates are recorded in the unrealized foreign currency translation gains (losses) line in the consolidated statement of comprehensive income (loss).
+Added: (3) Impact of cash flow hedges reported as net investment gains (losses) includes $ 1 of losses reclassified from accumulated other comprehensive income (loss) into earnings during the three-month period ended June 30, 2023, and $ 1 of losses during the three-month period ended June 30, 2022 .
+Added: Six Months Ended June 30,
+Added: (In millions) Net Investment Income (1)
+Added: Net Investment
+Added: Gains (Losses) Other
+Added: Comprehensive
+Added: Income (Loss) (2)
+Added: Net Investment Income (1)
+Added: Net Investment
+Added: Gains (Losses) Other
+Added: Comprehensive
+Added: Income (Loss) (2)
+Added: Qualifying hedges:
+Added: Cash flow hedges:
+Added: Foreign currency swaps - VIE $ 0 $ ( 2 ) $ 2 $ 0 $ ( 2 ) $ 1
+Added: Total cash flow hedges 0 ( 2 ) (3)
2 0 ( 2 ) (3)
+Added: Fair value hedges:
+Added: Foreign currency options ( 64 ) ( 26 )
Total fair value hedges ( 64 ) ( 26 )
20 unchanged sentences
Gains and losses on net investment hedges related to changes in foreign currency spot rates are recorded in the unrealized foreign currency translation gains (losses) line in the consolidated statement of comprehensive income (loss).
−Removed: (3) Impact of cash flow hedges reported as net investment gains (losses) includes $ 1 of losses reclassified from accumulated other comprehensive income (loss) into earnings during the three-month period ended March 31, 2023, and $ 1 of losses during the three-month period ended March 31, 2022.
−Removed: In addition, an immaterial amount of losses were reclassified from accumulated other comprehensive income (loss) into earnings during the three-month period ended March 31, 2023, and an immaterial amount during the three-month period ended March 31, 2022, related to fair value hedges excluded component.
−Removed: Impact shown net of effect of hedged items (see Fair Value Hedges section of this Note 4 for further detail).
−Removed: As of March 31, 2023, $ 5 million of deferred losses on derivative instruments recorded in accumulated other comprehensive income are expected to be reclassified into earnings during the next twelve months.
+Added: (3) Impact of cash flow hedges reported as net investment gains (losses) includes $ 1 of losses reclassified from accumulated other comprehensive income (loss) into earnings during the six-month period ended June 30, 2023, and $ 1 of losses during the six-month period ended June 30, 2022 .
+Added: As of June 30, 2023, $ 5 million of deferred losses on derivative instruments recorded in accumulated other comprehensive income are expected to be reclassified into earnings during the next twelve months.
Credit Risk Assumed through Derivatives
4 unchanged sentences
The risk of counterparty default for the Company's foreign currency swaps, certain foreign currency forwards, and foreign currency options is mitigated by collateral posting requirements that counterparties to those transactions must meet.
−Removed: As of March 31, 2023, all of the Company's derivative agreement counterparties were investment grade.
+Added: As of June 30, 2023, all of the Company's derivative agreement counterparties were investment grade.
The Company engages in over-the-counter (OTC) bilateral derivative transactions directly with unaffiliated third parties under International Swaps and Derivatives Association, Inc.
7 unchanged sentences
Collateral posted by the Company to third parties for derivative transactions can generally be repledged or resold by the counterparties.
−Removed: The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a net liability position by counterparty was approximately $ 767 million and $ 1.3 billion as of March 31, 2023, and December 31, 2022, respectively.
−Removed: If the credit-risk-related contingent features underlying these agreements had been triggered on March 31, 2023, the Company estimates that it would be required to post a maximum of $ 222 million of additional collateral to these derivative counterparties.
+Added: The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a net liability position by counterparty was approximately $ 1.2 billion and $ 1.3 billion as of June 30, 2023, and December 31, 2022, respectively.
+Added: If the credit-risk-related contingent features underlying these agreements had been triggered on June 30, 2023, the Company estimates that it would be required to post a maximum of $ 162 million of additional collateral to these derivative counterparties.
The Company is generally allowed to sell or repledge collateral obtained from its derivative counterparties, although it does not typically exercise such rights.
9 unchanged sentences
Offsetting of Financial Assets and Derivative Assets
−Removed: March 31, 2023
+Added: June 30, 2023
Gross Amounts Not Offset
52 unchanged sentences
Offsetting of Financial Liabilities and Derivative Liabilities
−Removed: March 31, 2023
+Added: June 30, 2023
Gross Amounts Not Offset
60 unchanged sentences
The following tables present the fair value hierarchy levels of the Company's assets and liabilities that are measured and carried at fair value on a recurring basis.
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions) Quoted Prices in
62 unchanged sentences
The following tables present the carrying amount and fair value categorized by fair value hierarchy level for the Company's financial instruments that are not carried at fair value.
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions) Carrying
75 unchanged sentences
The following tables present the pricing sources for the fair values of the Company's fixed maturity and equity securities.
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions) Quoted Prices in Active Markets for Identical Assets
11 unchanged sentences
Internal 0 293 0 293
−Removed: Broker/other 0 0 0 0
Total municipalities 0 2,323 0 2,323
29 unchanged sentences
Total equity securities $ 752 $ 0 $ 213 $ 965
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions) Quoted Prices in Active Markets for Identical Assets
15 unchanged sentences
Third party pricing vendor 0 229 0 229
−Removed: Broker/other 0 264 0 264
+Added: Internal 0 233 0 233
Total sovereign and supranational 0 462 0 462
99 unchanged sentences
The Parent Company has cross-currency swap agreements related to certain of its U.S.
−Removed: dollar-denominated senior notes to effectively convert a portion of the interest on the notes from U.S dollar to Japanese yen.
+Added: dollar-denominated senior notes to effectively convert a portion of the interest on the notes from U.S.
+Added: dollar to Japanese yen.
Their fair values are based on observable market inputs, therefore they are classified as Level 2.
37 unchanged sentences
Three Months Ended
−Removed: March 31, 2023
+Added: June 30, 2023
Fixed Maturity Securities Equity
1 unchanged sentence
Securities Public
+Added: Utilities Sovereign and Supranational Banks/
+Added: Institutions Other
+Added: Corporate Total
+Added: Balance, beginning of period $ 418 $ 350 $ 37 $ 161 $ 753 $ 221 $ 1,940
+Added: Net investment gains (losses) included
+Added: in earnings 0 0 0 0 0 ( 8 ) ( 8 )
+Added: Unrealized gains (losses) included in
+Added: other comprehensive income (loss) ( 13 ) ( 16 ) ( 3 ) 2 ( 22 ) 0 ( 52 )
+Added: Purchases, issuances, sales and
+Added: Purchases 136 0 0 0 37 0 173
+Added: Issuances 0 0 0 0 0 0 0
+Added: Sales 0 0 0 0 0 0 0
+Added: Settlements ( 13 ) ( 2 ) ( 2 ) ( 7 ) ( 1 ) 0 ( 25 )
+Added: Transfers into Level 3 124 0 0 0 0 0 124
+Added: Transfers out of Level 3 0 ( 30 ) 0 ( 87 ) ( 195 ) 0 ( 312 )
+Added: Balance, end of period $ 652 $ 302 $ 32 $ 69 $ 572 $ 213 $ 1,840
+Added: Changes in unrealized gains (losses)
+Added: relating to Level 3 assets and liabilities
+Added: still held at the end of the period
+Added: included in earnings $ 0 $ 0 $ 0 $ 0 $ 0 $ ( 8 ) $ ( 8 )
+Added: Three Months Ended
+Added: June 30, 2022
+Added: Fixed Maturity Securities Equity
+Added: (In millions) Mortgage-
+Added: Securities Public
+Added: Utilities Sovereign and Supranational Banks/
+Added: Institutions Other
+Added: Corporate Total
+Added: Balance, beginning of period $ 318 $ 585 $ 41 $ 60 $ 290 $ 166 $ 1,460
+Added: Net investment gains (losses) included
+Added: in earnings 0 1 0 0 0 ( 6 ) ( 5 )
+Added: Unrealized gains (losses) included in
+Added: other comprehensive income (loss) ( 54 ) ( 44 ) ( 5 ) ( 2 ) ( 37 ) 0 ( 142 )
+Added: Purchases, issuances, sales and
+Added: Purchases 90 19 0 33 122 33 297
+Added: Issuances 0 0 0 0 0 0 0
+Added: Sales 0 0 0 0 0 0 0
+Added: Settlements ( 36 ) ( 24 ) 0 0 ( 1 ) 0 ( 61 )
+Added: Transfers into Level 3 0 0 0 0 258 0 258
+Added: Transfers out of Level 3 ( 7 ) 0 0 0 0 ( 3 ) ( 10 )
+Added: Balance, end of period $ 311 $ 537 $ 36 $ 91 $ 632 $ 190 $ 1,797
+Added: Changes in unrealized gains (losses)
+Added: relating to Level 3 assets and liabilities
+Added: still held at the end of the period
+Added: included in earnings $ 0 $ 0 $ 0 $ 0 $ 0 $ ( 6 ) $ ( 6 )
+Added: Six Months Ended
+Added: June 30, 2023
+Added: Fixed Maturity Securities Equity
+Added: (In millions) Mortgage-
+Added: Securities Public
Utilities Sovereign
20 unchanged sentences
of the period included in earnings $ 0 $ 0 $ 0 $ 0 $ 0 $ ( 5 ) $ ( 5 )
−Removed: Three Months Ended
−Removed: March 31, 2022
+Added: Six Months Ended
+Added: June 30, 2022
Fixed Maturity Securities Equity
26 unchanged sentences
Included in the tables are the inputs or range of possible inputs that have an effect on the overall valuation of the financial instruments.
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions) Fair Value Valuation Technique(s) Unobservable Input Range Weighted Average
4 unchanged sentences
Sovereign and supranational 32 Consensus pricing Offered quotes N/A (c)
−Removed: Banks/financial institutions 161 Discounted cash flow Credit spreads 67 bps - 188 bps (b)
+Added: Banks/financial institutions 69 Discounted cash flow Credit spreads N/A (c)
Other corporate 572 Discounted cash flow Credit spreads 67 bps - 294 bps (b)
46 unchanged sentences
The following tables present a rollforward of deferred policy acquisition costs by reporting segment and disaggregated by product type.
−Removed: March 31, 2023
+Added: June 30, 2023
Aflac Japan Aflac U.S.
7 unchanged sentences
other ( 262 ) ( 185 ) ( 44 ) ( 4 ) 0 0 0 0 0 0 ( 2 ) ( 497 )
−Removed: Balance at March 31, 2023
+Added: Balance at June 30, 2023
$ 2,832 $ 1,985 $ 481 $ 54 $ 911 $ 616 $ 1,317 $ 425 $ 87 $ 151 $ 1 $ 8,860
13 unchanged sentences
Policy Type Constant-level Basis
−Removed: Life Products (U.S.) Face Value
−Removed: Health Products (U.S.) Policy Count
+Added: Life Products (U.S.) Face Amount
+Added: Health Products (U.S.) Number of Policies in Force
Health & Life Products (Japan) Units in Force
−Removed: Face value is the stated dollar amount that the policy’s beneficiaries receive upon the death of the insured.
+Added: Face amount is the stated dollar amount that the policy’s beneficiaries receive upon the death of the insured.
For life and health products issued in Japan, the constant-level basis used is units in force, which is a proxy for face amount and insurance in force, respectively.
Future DAC amortization is impacted by persistency.
−Removed: There were no changes to the inputs, judgements, assumptions and methods used to determine amortization amounts during the three-month periods ended March 31, 2023 and 2022.
+Added: There were no changes to the inputs, judgements, assumptions and methods used to determine amortization amounts during the six-month periods ended June 30, 2023 and 2022.
See Note 1 of the Notes to the Consolidated Financial Statements for more information on deferred policy acquisition costs.
3 unchanged sentences
The following tables present the changes in the present value of expected net premiums and the present value of expected future policy benefits by reporting segment and disaggregated by product type .
−Removed: March 31, 2023
+Added: June 30, 2023
Aflac Japan Aflac U.S.
16 unchanged sentences
Effect of changes in discount rate assumptions 1,579 1,135 335 47 ( 201 ) ( 129 ) ( 497 ) ( 129 ) ( 17 ) ( 68 ) ( 8 )
−Removed: Balance at March 31, 2023
+Added: Balance at June 30, 2023
$ 17,973 $ 15,632 $ 6,715 $ 1,145 $ 2,504 $ 1,669 $ 4,499 $ 1,240 $ 209 $ 763 $ 169
14 unchanged sentences
Effect of changes in discount rate assumptions 8,551 1,462 670 ( 25 ) ( 264 ) ( 176 ) ( 1,166 ) ( 201 ) ( 39 ) ( 228 ) 6
−Removed: Balance at March 31, 2023
+Added: Balance at June 30, 2023
51,692 26,527 30,407 5,376 3,094 2,464 11,637 2,109 484 1,613 686
48 unchanged sentences
The following tables present the weighted-average interest rates and weighted-average liability duration (calculated using the original discount rate) by reporting segment and disaggregated by product type.
−Removed: March 31, 2023
+Added: June 30, 2023
Aflac Japan Aflac U.S.
19 unchanged sentences
The deferred profit liability for limited-payment contracts and the deferred profit liability for reinsurance is presented together with the liability for future policy benefits in the Consolidated Balance Sheets and has been included as a reconciling item in the table below.
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31, 2022
14 unchanged sentences
Deferred profit liability - reinsurance 620 692
+Added: Intercompany eliminations (1)
+Added: ( 2,680 ) ( 667 )
Total $ 85,904 $ 88,241
+Added: (1) Elimination entry necessary due to the internal reinsurance transaction with Aflac Re and to recapture of a portion of policy liabilities ceded externally as a result of the reinsurance retrocession transaction.
+Added: See Note 8 of the Notes to the Consolidated Financial Statements.
Discount rates are determined using upper-medium grade (low-credit-risk) fixed-income instrument yields that reflect the duration characteristics of the liability.
10 unchanged sentences
Lastly, for the tenors where there is limited or no observable single-A or similar market data or risk-free government rates (beyond 30 years), the discount curve is derived by extrapolation of risk free rates beyond their last liquid point following the Smith-Wilson method and grading of the estimated forward credit spread anchored by the ultimate forward rate.
−Removed: The ultimate forward rate is based on the economic value-based solvency regime, which is consistent with the International Association of Insurance Supervisors (IAIS) Insurance Capital Standards (ICS) (which is expected to be introduced in Japan in 2025), and is adjusted for credit and inflation components.
+Added: forward rate is based on the economic value-based solvency regime, which is consistent with the International Association of Insurance Supervisors (IAIS) Insurance Capital Standards (ICS) (which is expected to be introduced in Japan in 2025), and is adjusted for credit and inflation components.
For the Aflac U.S.
6 unchanged sentences
and Japan segments is based on the assumption of long-term global economic convergence.
−Removed: For the three-month periods ended March 31, 2023 and 2022, the Company recognized $( 2.8 ) billion and $ 4.2 billion in other comprehensive income (loss) net of tax, respectively, due to changes in the future policy benefits estimate from updating the discount rate assumptions.
−Removed: There were no changes to the methods used to determine the discount rates during the three-month periods ended March 31, 2023 and 2022.
+Added: For the three-month periods ended June 30, 2023 and 2022, the Company recognized $( 165 ) million and $ 5.1 billion in other comprehensive income (loss) net of tax, respectively, due to changes in the future policy benefits estimate from updating the discount rate assumptions.
+Added: For the six-month periods ended June 30, 2023 and 2022, the Company recognized $( 3.0 ) billion and $ 9.3 billion in other comprehensive income (loss) net of tax, respectively, due to changes in the future policy benefits estimate from updating the discount rate assumptions.
+Added: There were no changes to the methods used to determine the discount rates during the six-month periods ended June 30, 2023 and 2022.
For the year ended December 31, 2022, the Company recognized $ 13.7 billion in other comprehensive income (loss) net of tax, due to changes in the future policy benefits estimate from updating the discount rate assumptions.
9 unchanged sentences
Policy provisions, such as reaching premium paid-up status, are taken into account when setting assumptions.
−Removed: During the three-month periods ended March 31, 2023 and 2022, the Company's adjustment for actual variances from expected experience resulted in reserve remeasurement gains of $ 53 million and $ 34 million in the consolidated statement of earnings, respectively.
−Removed: The variance of actual experience from expected experience was primarily due to favorable variances in morbidity assumptions as compared to actual experience.
−Removed: There were no changes to the inputs, judgments, assumptions and methods used in measuring the liability for future policy benefits during the three-month periods ended March 31, 2023 and 2022.
+Added: During the three-month periods ended June 30, 2023 and 2022, the Company's adjustment for actual variances from expected experience resulted in reserve remeasurement gains of $ 54 million and $ 25 million in the consolidated statement of earnings, respectively.
+Added: During the six-month periods ended June 30, 2023 and 2022, the Company's adjustment for actual variances from expected experience resulted in reserve remeasurement gains of $ 107 million and $ 59 million in the consolidated statement of earnings, respectively.
+Added: For the three- and six-month periods ended June 30, 2023 and 2022, the variance of actual experience from expected experience was primarily due to favorable variances in morbidity assumptions as compared to actual experience.
+Added: There were no changes to the inputs, judgments, assumptions and methods used in measuring the liability for future policy benefits during the six-month periods ended June 30, 2023 and 2022.
In 2022, the Company's annual review process resulted in favorable changes to its morbidity assumptions due to favorable claims experience, primarily.
1 unchanged sentence
The following table summarizes the amount of net earned premiums recognized in the Consolidated Statements of Earnings by reporting segment and disaggregated by product type.
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions) 2023 2022 2023 2022
3 unchanged sentences
Life insurance 390 459 812 983
+Added: Other 38 42 77 85
Accident 322 329 652 665
4 unchanged sentences
Life insurance 115 99 228 197
+Added: Other 9 9 19 19
Corporate and other 84 36 175 82
2 unchanged sentences
The following table summarizes the amount of interest expense related to insurance contracts recognized in total benefits and claims, net in the Consolidated Statements of Earnings by reporting segment and disaggregated by product type.
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions) 2023 2022 2023 2022
3 unchanged sentences
Life insurance 130 136 263 285
+Added: Other 20 21 42 45
+Added: Accident 6 5 12 12
Disability 10 9 18 19
3 unchanged sentences
Life insurance 10 8 19 17
−Removed: Corporate and other 0 0
+Added: Other 6 7 13 13
Total $ 629 $ 654 $ 1,270 $ 1,367
5 unchanged sentences
These are the primary factors that result in future gross premiums lower than future benefit and expense payments for certain lines of business of the Company.
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Gross
14 unchanged sentences
Total $ 188,305 $ 233,786 $ 191,005 $ 235,775
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Gross Premiums Benefits and Expenses Gross Premiums Benefits and Expenses
13 unchanged sentences
Total $ 125,393 $ 136,089 $ 132,451 $ 141,463
−Removed: Loss expense as a result of net premium ratio capping for the three-month periods ended March 31, 2023 and 2022 was immaterial.
+Added: Loss expense as a result of net premium ratio capping for the three- and six-month periods ended June 30, 2023 and 2022 was immaterial.
Other Policyholders' Funds
−Removed: As of March 31, 2023 and December 31, 2022, the largest component of the other policyholders' funds liability was the Company's annuity line of business in Aflac Japan.
+Added: As of June 30, 2023 and December 31, 2022, the largest component of the other policyholders' funds liability was the Company's annuity line of business in Aflac Japan.
The Company's annuities have fixed benefits and premiums.
The following table presents the changes in other policyholders’ funds.
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31, 2022
13 unchanged sentences
The following table presents other policyholders’ funds balances by range of guaranteed crediting rates.
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
(In millions) Range of Guaranteed Minimum Crediting Rates (2)
6 unchanged sentences
(1) Aflac Japan fixed annuities
−Removed: (2) Weighted-average crediting rate of 1.5 % at March 31, 2023 and December 31, 2022, respectively.
+Added: (2) Weighted-average crediting rate of 1.5 % at June 30, 2023 and December 31, 2022.
Aflac Japan’s fixed annuities have guaranteed fixed crediting rates which results in the policyholders' funds balances being able to cover all guaranteed benefit amounts.
7 unchanged sentences
This transaction transferred approximately $ 2.1 billion of reserves associated with these policies.
−Removed: Approximately $ 1.9 billion of assets were transferred from ALIJ to Aflac Re as preliminary consideration for assuming the reinsurance risk, and final settlement is expected in the second quarter of 2023.
+Added: Approximately $ 1.9 billion of assets were transferred from ALIJ to Aflac Re as consideration for assuming the reinsurance risk.
This internal reinsurance transaction with Aflac Re has no financial statement impact on a consolidated basis, except for the effect of foreign currency accounting.
1 unchanged sentence
The Company has recorded a deferred profit liability related to reinsurance transactions.
−Removed: The remaining deferred profit liability of $ 682 million and $ 692 million as of March 31, 2023 and December 31, 2022, respectively, is included in future policy benefits in the consolidated balance sheet and is being amortized into income over the expected lives of the policies.
−Removed: The Company has also recorded a reinsurance recoverable for reinsurance transactions, which is included in other assets in the consolidated balance sheet and had a remaining balance of $ 1.1 billion and $ 912 million as of March 31, 2023 and December 31, 2022, respectively.
−Removed: The following table reconciles direct premiums and direct benefits and claims to net amounts after the effect of reinsurance which also includes the elimination of inter-segment amounts associated with affiliated reinsurance.
−Removed: Three Months Ended March 31,
+Added: The remaining deferred profit liability of $ 620 million and $ 692 million as of June 30, 2023 and December 31, 2022, respectively, is included in future policy benefits in the consolidated balance sheet and is being amortized into income over the expected lives of the policies.
+Added: The Company has also recorded a reinsurance recoverable for reinsurance transactions, which is included in other assets in the consolidated balance sheet and had a remaining balance of $ 998 million and $ 912 million as of June 30, 2023 and December 31, 2022, respectively.
+Added: The following table reconciles direct premiums and direct benefits and claims to net amounts after the effect of reinsurance and the elimination of inter-segment amounts associated with affiliated reinsurance.
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In millions) 2023 2022 2023 2022
5 unchanged sentences
Retrocession activities 30 36 64 77
+Added: Other 23 41 47 81
Net earned premiums $ 3,573 $ 3,764 $ 7,262 $ 7,844
9 unchanged sentences
Eliminations ( 47 ) ( 10 ) ( 76 ) ( 17 )
+Added: Other 65 40 103 80
Total benefits and claims, net $ 2,098 $ 2,274 $ 4,247 $ 4,757
2 unchanged sentences
In the event that the reinsurer is unable to meet their obligations, the Company remains liable for the reinsured claims.
−Removed: As a part of its capital contingency plan, the Company entered into a committed reinsurance facility agreement on December 1, 2015, with reserves of approximately ¥ 120 billion as of March 31, 2023.
+Added: As a part of its capital contingency plan, the Company entered into a committed reinsurance facility agreement on December 1, 2015, with reserves of approximately ¥ 120 billion as of June 30, 2023.
This reinsurance facility agreement was renewed in 2022 and is effective until December 31, 2023.
1 unchanged sentence
The reinsurer can withdraw from the committed facility if Aflac's Standard and Poor's (S&P) rating drops below BBB-.
−Removed: As of March 31, 2023, the Company has not executed a reinsurance treaty under this committed reinsurance facility.
+Added: As of June 30, 2023, the Company has not executed a reinsurance treaty under this committed reinsurance facility.
NOTES PAYABLE AND LEASE OBLIGATIONS
A summary of notes payable and lease obligations follows:
−Removed: (In millions) March 31,
+Added: (In millions) June 30,
2023 December 31,
31 unchanged sentences
Yen-denominated loans:
−Removed: Variable interest rate loan due August 2027 ( .35 % in 2023 and .33 % in 2022, principal amount ¥ 11.7 billion)
Variable interest rate loan due August 2027 ( .35 % in 2023 and .33 % in 2022,
2 unchanged sentences
principal amount ¥ 25.3 billion)
+Added: Variable interest rate loan due August 2032 ( .60 % in 2023 and .58 % in 2022,
+Added: principal amount ¥ 70.0 billion)
Finance lease obligations payable through 2030 7 8
2 unchanged sentences
Amounts in the table above are reported net of debt issuance costs and issuance premiums or discounts, if applicable, that are being amortized over the life of the notes.
−Removed: A summary of the Company's lines of credit as of March 31, 2023 follows:
+Added: A summary of the Company's lines of credit as of June 30, 2023 follows:
Borrower(s) Type Term Expiration Date Capacity Amount Outstanding Interest Rate on Borrowed Amount Maturity Period Commitment Fee Business Purpose
31 unchanged sentences
Company's option, either (a) a rate
−Removed: determined by reference to USD LIBOR for
+Added: determined by reference to SOFR for
the interest period relevant to such
borrowing or (b) the base rate determined
−Removed: by reference to the highest of (a) the
+Added: by reference to the highest of (1) the
lender's USD short-term commercial loan
−Removed: rate, (b) the federal funds rate plus 1/2 of
−Removed: 1% and (c) USD one-month LIBOR plus
−Removed: USD LIBOR is subject to replacement
−Removed: with SOFR under certain circumstances Up to 3 months
+Added: rate and (2) the federal funds rate plus 1/2 of 1% Up to 3 months
None General corporate purposes
uncommitted revolving 364 days November 30, 2023 $ 250 million
−Removed: USD three-month LIBOR plus 75 basis points per annum No later than December 1, 2023 None General corporate purposes
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 75 basis points per annum No later than December 1, 2023 None General corporate purposes
Aflac Incorporated (1)
8 unchanged sentences
uncommitted revolving 364 days April 8,
−Removed: USD three-month LIBOR plus 75 basis points per annum No later than
+Added: 2024 $ 25 million
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 75 basis points per annum No later than
April 9, 2024 None General corporate purposes
1 unchanged sentence
2024 $ 15 million
−Removed: USD three-month LIBOR plus 75 basis points per annum No later than
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 75 basis points per annum No later than
March 22, 2024 None General corporate purposes
(1) Intercompany credit agreement
−Removed: (2) Renewed in April 2023 with an expiration date of April 8, 2024
Borrower(s) Type Term Expiration Date Capacity Amount Outstanding Interest Rate on Borrowed Amount Maturity Period Commitment Fee Business Purpose
2 unchanged sentences
2024 $ 0.3 million
−Removed: USD three-month LIBOR plus 75 basis points per annum No later than March 22, 2024 None General corporate purposes
−Removed: Aflac Ventures Japan K.K.
−Removed: uncommitted revolving 364 days May 2,
−Removed: 2023 ¥ 500 million
−Removed: A rate per annum equal to the short-term prime lending rates of banks appearing on the website for the Bank of Japan on the first day of the applicable period No later than
−Removed: May 3, 2023 None General corporate purposes
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 75 basis points per annum No later than
+Added: March 22, 2024 None General corporate purposes
Hatch Healthcare K.K.
2 unchanged sentences
A rate per annum equal to the short-term prime lending rates of banks appearing on the website for the Bank of Japan on the first day of the applicable period No later than January 4, 2024 None General corporate purposes
−Removed: Hatch Insight K.K.
+Added: Aflac Digital Services Co., Ltd.
+Added: (formerly known as Hatch Insight K.K.) (1)
uncommitted revolving 364 days January 3,
4 unchanged sentences
2023 $ 30 million
−Removed: USD three-month LIBOR plus 75 basis points per annum No later than July 18, 2023 None General corporate purposes
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 75 basis points per annum No later than
+Added: July 18, 2023 None General corporate purposes
Aflac Incorporated (1)
1 unchanged sentence
2024 $ 400 million
−Removed: A rate per annum equal to three-month term SOFR plus 10 basis points for U.S.
−Removed: dollar denominated borrowings or three-month TIBOR for Japanese yen denominated borrowings No later than January 3, 2024 None General corporate purposes
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 97 basis points per annum for U.S.
+Added: dollar denominated borrowings or three-month TIBOR plus 97 basis points per annum for Japanese yen denominated borrowings No later than January 3, 2024 None General corporate purposes
Aflac Re Bermuda Ltd.
1 unchanged sentence
2024 $ 400 million
−Removed: A rate per annum equal to three-month term SOFR plus 10 basis points for U.S.
−Removed: dollar denominated borrowings or three-month TIBOR for Japanese yen denominated borrowings No later than January 3, 2024 None General corporate purposes
+Added: Three-month term SOFR plus a 10 basis point SOFR adjustment and an additional 68 basis points per annum for U.S.
+Added: dollar denominated borrowings or three-month TIBOR plus 68 basis points per annum for Japanese yen denominated borrowings No later than January 3, 2024 None General corporate purposes
(1) Intercompany credit agreement
−Removed: The Company was in compliance with all of the covenants of its notes payable and lines of credit at March 31, 2023.
−Removed: No events of default or defaults occurred during the three-month period ended March 31, 2023.
+Added: (2) Renewed in July 2023 with an expiration date of July 16, 2024
+Added: The Company was in compliance with all of the covenants of its notes payable and lines of credit at June 30, 2023.
+Added: No events of default or defaults occurred during the six-month period ended June 30, 2023.
For additional information, see Notes 4 and 9 of the Notes to the Consolidated Financial Statements in the 2022 Annual Report.
SHAREHOLDERS’ EQUITY
−Removed: The following table is a reconciliation of the number of shares of the Company's common stock for the three-month periods ended March 31.
+Added: The following table is a reconciliation of the number of shares of the Company's common stock for the six-month periods ended June 30.
(In thousands of shares) 2023 2022
16 unchanged sentences
The following table presents the approximate number of share-based awards to purchase shares, on a weighted-average basis, that were considered to be anti-dilutive and were excluded from the calculation of diluted EPS for the following periods.
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(In thousands) 2023 2022 2023 2022
1 unchanged sentence
Share Repurchase Program
−Removed: During the first three months of 2023, the Company repurchased 10.3 million shares of its common stock for $ 700 million as part of its share repurchase program.
−Removed: During the first three months of 2022, the Company repurchased 8.0 million shares of its common stock for $ 500 million as part of its share repurchase program.
−Removed: As of March 31, 2023, a remaining balance of 106.3 million shares of the Company's common stock was available for purchase under share repurchase authorizations by its board of directors.
+Added: During the first six months of 2023, the Company repurchased 20.8 million shares of its common stock for $ 1.4 billion as part of its share repurchase program.
+Added: During the first six months of 2022, the Company repurchased 19.2 million shares of its common stock for $ 1.2 billion as part of its share repurchase program.
+Added: As of June 30, 2023, a remaining balance of 95.8 million shares of the Company's common stock was available for purchase under share repurchase authorizations by its board of directors.
Reclassifications from Accumulated Other Comprehensive Income
2 unchanged sentences
Three Months Ended
−Removed: March 31, 2023
+Added: June 30, 2023
(In millions) Unrealized Foreign
6 unchanged sentences
Adjustment Total
−Removed: Balance at December 31, 2022 $ ( 3,564 ) $ ( 702 ) $ ( 27 ) $ ( 2,100 ) $ ( 36 ) $ ( 6,429 )
+Added: Balance at March 31, 2023 $ ( 3,618 ) $ 1,289 $ ( 26 ) $ ( 4,894 ) $ ( 29 ) $ ( 7,278 )
Other comprehensive
8 unchanged sentences
income (loss) ( 631 ) 689 1 ( 165 ) 46 ( 60 )
+Added: Balance at June 30, 2023 $ ( 4,249 ) $ 1,978 $ ( 25 ) $ ( 5,059 ) $ 17 $ ( 7,338 )
+Added: All amounts in the table above are net of tax.
+Added: Three Months Ended
+Added: June 30, 2022
+Added: (In millions) Unrealized Foreign
+Added: Currency Translation
+Added: Gains (Losses) Unrealized
+Added: Gains (Losses)
+Added: on Fixed Maturity Securities Unrealized
+Added: Gains (Losses)
+Added: on Derivatives Effect of Changes in Discount Rate Assumptions Pension Liability Adjustment Total
Balance at March 31, 2022 $ ( 2,438 ) $ 5,787 $ ( 29 ) $ ( 11,608 ) $ ( 163 ) $ ( 8,451 )
+Added: Other comprehensive
+Added: income (loss) before
+Added: reclassification ( 780 ) ( 2,767 ) ( 1 ) 5,105 ( 1 ) 1,556
+Added: Amounts reclassified from
+Added: accumulated other
+Added: comprehensive income
+Added: (loss) 0 ( 90 ) 1 0 4 ( 85 )
+Added: Net current-period other
+Added: comprehensive
+Added: income (loss) ( 780 ) ( 2,857 ) 0 5,105 3 1,471
+Added: Balance at June 30, 2022 $ ( 3,218 ) $ 2,930 $ ( 29 ) $ ( 6,503 ) $ ( 160 ) $ ( 6,980 )
All amounts in the table above are net of tax.
Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration insurance contracts.
−Removed: Three Months Ended
−Removed: March 31, 2022
+Added: Six Months Ended
+Added: June 30, 2023
(In millions) Unrealized Foreign
4 unchanged sentences
Gains (Losses)
+Added: on Derivatives Effect of Changes in Discount Rate Assumptions Pension
+Added: Adjustment Total
+Added: Balance at December 31, 2022 $ ( 3,564 ) $ ( 702 ) $ ( 27 ) $ ( 2,100 ) $ ( 36 ) $ ( 6,429 )
+Added: Other comprehensive
+Added: income (loss) before
+Added: reclassification ( 685 ) 2,746 1 ( 2,959 ) 52 ( 845 )
+Added: Amounts reclassified from
+Added: accumulated other
+Added: comprehensive income
+Added: (loss) 0 ( 66 ) 1 0 1 ( 64 )
+Added: Net current-period other
+Added: comprehensive
+Added: income (loss) ( 685 ) 2,680 2 ( 2,959 ) 53 ( 909 )
+Added: Balance at June 30, 2023 $ ( 4,249 ) $ 1,978 $ ( 25 ) $ ( 5,059 ) $ 17 $ ( 7,338 )
+Added: All amounts in the table above are net of tax.
+Added: Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration insurance contracts.
+Added: Six Months Ended
+Added: June 30, 2022
+Added: (In millions) Unrealized Foreign
+Added: Currency Translation
+Added: Gains (Losses) Unrealized
+Added: Gains (Losses)
+Added: on Fixed Maturity Securities Unrealized
+Added: Gains (Losses)
on Derivatives Effect of Changes in Discount Rate Assumptions Pension Liability Adjustment Total
10 unchanged sentences
income (loss) ( 1,233 ) ( 6,672 ) 1 9,329 6 1,431
−Removed: Balance at March 31, 2022 $ ( 2,438 ) $ 5,787 $ ( 29 ) $ ( 11,608 ) $ ( 163 ) $ ( 8,451 )
+Added: Balance at June 30, 2022 $ ( 3,218 ) $ 2,930 $ ( 29 ) $ ( 6,503 ) $ ( 160 ) $ ( 6,980 )
All amounts in the table above are net of tax.
3 unchanged sentences
(In millions) Three Months Ended
−Removed: March 31, 2023
+Added: June 30, 2023
Details about Accumulated Other Comprehensive Income Components Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the
16 unchanged sentences
(In millions) Three Months Ended
−Removed: March 31, 2022
+Added: June 30, 2022
Details about Accumulated Other Comprehensive Income Components Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the
15 unchanged sentences
(2) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost (see Note 12 for additional details).
+Added: (In millions) Six Months Ended
+Added: June 30, 2023
+Added: Details about Accumulated Other Comprehensive Income Components Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the
+Added: Statements of Earnings
+Added: Unrealized gains (losses) on available-for-sale
+Added: securities $ 84 Net investment gains (losses)
+Added: ( 18 ) Tax (expense) or benefit (1)
+Added: $ 66 Net of tax
+Added: Unrealized gains (losses) on derivatives $ ( 1 ) Net investment gains (losses)
+Added: 0 Tax (expense) or benefit (1)
+Added: $ ( 1 ) Net of tax
+Added: Amortization of defined benefit pension items:
+Added: Actuarial gains (losses) $ ( 1 ) Acquisition and operating expenses (2)
+Added: Prior service (cost) credit 0 Acquisition and operating expenses (2)
+Added: 0 Tax (expense) or benefit (1)
+Added: $ ( 1 ) Net of tax
+Added: Total reclassifications for the period $ 64 Net of tax
+Added: (1) Based on 21 % tax rate
+Added: (2) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost (see Note 12 for additional details).
+Added: (In millions) Six Months Ended
+Added: June 30, 2022
+Added: Details about Accumulated Other Comprehensive Income Components Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the
+Added: Statements of Earnings
+Added: Unrealized gains (losses) on available-for-sale
+Added: securities $ 192 Net investment gains (losses)
+Added: ( 40 ) Tax (expense) or benefit (1)
+Added: $ 152 Net of tax
+Added: Unrealized gains (losses) on derivatives $ ( 1 ) Net investment gains (losses)
+Added: 0 Tax (expense) or benefit (1)
+Added: $ ( 1 ) Net of tax
+Added: Amortization of defined benefit pension items:
+Added: Actuarial gains (losses) $ ( 11 ) Acquisition and operating expenses (2)
+Added: Prior service (cost) credit 0 Acquisition and operating expenses (2)
+Added: 2 Tax (expense) or benefit (1)
+Added: $ ( 9 ) Net of tax
+Added: Total reclassifications for the period $ 142 Net of tax
+Added: (1) Based on 21 % tax rate
+Added: (2) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost (see Note 12 for additional details).
SHARE-BASED COMPENSATION
−Removed: As of March 31, 2023, the Company has outstanding share-based awards under the Aflac Incorporated Long-Term Incentive Plan (As Amended and Restated February 14, 2017), as further amended on August 9, 2022 (the Plan).
+Added: As of June 30, 2023, the Company has outstanding share-based awards under the Aflac Incorporated Long-Term Incentive Plan (As Amended and Restated February 14, 2017), as further amended on August 9, 2022 (the Plan).
Share-based awards are designed to reward employees for their long-term contributions to the Company and provide incentives for them to remain with the Company.
1 unchanged sentence
The Plan, allows for a maximum number of shares issuable over its term of 75 million shares including 38 million shares that may be awarded in respect of awards other than options or stock appreciation rights.
−Removed: If any awards granted under the Plan are forfeited or are terminated before being exercised or settled for any reason other than tax forfeiture, then the shares underlying the awards will again be available under the Plan.
+Added: If any awards granted under the
+Added: Plan are forfeited or are terminated before being exercised or settled for any reason other than tax forfeiture, then the shares underlying the awards will again be available under the Plan.
The Plan allows awards to Company employees for incentive stock options (ISOs), non-qualifying stock options (NQSOs), restricted stock, restricted stock units, and stock appreciation rights.
Non-employee directors are eligible for grants of NQSOs, restricted stock, and stock appreciation rights.
−Removed: As of March 31, 2023, approximately 34.8 million shares were available for future grants under this plan.
+Added: As of June 30, 2023, approximately 34.7 million shares were available for future grants under this plan.
The ISOs and NQSOs have a term of 10 years, and the share-based awards generally vest upon time-based conditions or time and performance-based conditions.
1 unchanged sentence
Performance-based vesting conditions generally include the attainment of goals related to Company financial performance.
−Removed: As of March 31, 2023, the only performance-based awards issued and outstanding were restricted stock awards and units.
+Added: As of June 30, 2023, the only performance-based awards issued and outstanding were restricted stock awards and units.
Stock options and stock appreciation rights granted under the amended Plan have an exercise price of at least the fair market value of the underlying stock on the grant date and have an expiration date no later than 10 years from the grant date.
2 unchanged sentences
Share-based awards granted to U.S.-based grantees are settled with authorized but unissued Company stock, while those issued to Japan-based grantees are settled with treasury shares.
−Removed: The following table provides information on stock options outstanding and exercisable at March 31, 2023.
+Added: The following table provides information on stock options outstanding and exercisable at June 30, 2023.
Option Shares
6 unchanged sentences
Exercisable 1,231 2.6 46 32.78
−Removed: The Company received cash from the exercise of stock options in the amount of $ 4 million during the first three months of 2023, compared with $ 8 million in the first three months of 2022.
−Removed: The tax benefit realized as a result of stock option exercises and restricted stock releases was $ 17 million in the first three months of 2023, compared with $ 16 million in the first three months of 2022.
−Removed: As of March 31, 2023, total compensation cost not yet recognized in the Company's consolidated financial statements related to restricted stock awards and units was $ 75 million, of which $ 43 million ( 1.8 million shares) was related to restricted stock awards and units with a performance-based vesting condition.
+Added: The Company received cash from the exercise of stock options in the amount of $ 10 million during the first six months of 2023, compared with $ 9 million in the first six months of 2022.
+Added: The tax benefit realized as a result of stock option exercises and restricted stock releases was $ 19 million in the first six months of 2023, compared with $ 17 million in the first six months of 2022.
+Added: As of June 30, 2023, total compensation cost not yet recognized in the Company's consolidated financial statements related to restricted stock awards and units was $ 61 million, of which $ 33 million ( 1.8 million shares) was related to restricted stock awards and units with a performance-based vesting condition.
The Company expects to recognize these amounts over a weighted-average period of approximately 1.7 years.
There are no other contractual terms covering restricted stock awards once vested.
−Removed: The following table summarizes restricted stock activity during the three-month period ended March 31, 2023.
+Added: The following table summarizes restricted stock activity during the six-month period ended June 30, 2023.
(In thousands of shares) Shares Weighted-Average
6 unchanged sentences
( 1,133 ) 52.81
−Removed: Restricted stock at March 31, 2023
+Added: Restricted stock at June 30, 2023
2,342 $ 62.60
9 unchanged sentences
plan was frozen to new participants effective October 1, 2013.
+Added: On June 9, 2023, the Company amended the U.S.
+Added: defined benefit plan to freeze future benefits under the plan for all participants effective January 1, 2024, which resulted in the Company recognizing a curtailment gain of $ 49 million in the second quarter of 2023.
+Added: employees who are not participants in the defined benefit plan currently receive a nonelective 401(k) employer contribution.
+Added: Effective January 1, 2024, the nonelective 401(k) employer contribution will be extended to U.S.
+Added: employees who are current participants in the defined benefit plan.
The Company also maintains non-qualified, unfunded supplemental retirement plans that provide defined pension benefits in excess of limits imposed by federal tax law for certain Japanese, U.S.
−Removed: and former employees, however the U.S.
−Removed: plan was frozen to new participants effective January 1, 2015.
−Removed: employees who are not participants in the defined benefit plan receive a nonelective 401(k) employer contribution.
+Added: and former employees, however the Company's Supplemental Executive Retirement Plan was frozen to new participants effective January 1, 2015.
+Added: On June 9, 2023, the Company amended the Supplemental Executive Retirement Plan and the Retirement Plan for Senior Officers to freeze future benefits under these plans for all participants effective January 1, 2024.
The Company provides certain health care benefits for eligible U.S.
8 unchanged sentences
For certain employees and former employees, additional coverage is provided for all medical expenses for life.
−Removed: Pension and other postretirement benefit expenses are included in acquisition and operating expenses in the consolidated statements of earnings, which includes other components of net periodic pension cost and postretirement costs (other than service costs) of $ 2 million and $ 4 million for the three-month periods ended March 31, 2023 and 2022, respectively.
+Added: Pension and other postretirement benefit expenses are included in acquisition and operating expenses in the consolidated statements of earnings, which includes other components of net periodic pension cost and postretirement costs (other than service costs) of $( 45 ) million and $ 2 million for the three-month periods and $( 43 ) million and $ 6 million for the six-month periods ended June 30, 2023 and 2022, respectively.
Total net periodic benefit cost includes the following components:
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30,
Pension Benefits Other
7 unchanged sentences
Amortization of net actuarial loss 0 0 0 5 1 0
+Added: Curtailment (gain) loss 0 0 ( 49 ) 0 0 0
Net periodic (benefit) cost $ 4 $ 4 $ ( 45 ) $ 10 $ 2 $ 0
−Removed: During the three months ended March 31, 2023, Aflac Japan contributed approximately $ 6 million (using the weighted-average yen/dollar exchange rate for the three-month period ended March 31, 2023) to the Japanese funded defined benefit plan, and Aflac U.S.
+Added: Six Months Ended June 30,
+Added: Pension Benefits Other
+Added: Postretirement Benefits
+Added: (In millions) 2023 2022 2023 2022 2023 2022
+Added: Components of net periodic
+Added: benefit cost:
+Added: Service cost $ 7 $ 10 $ 7 $ 13 $ 0 $ 0
+Added: Interest cost 4 3 21 17 1 0
+Added: Expected return on plan assets ( 3 ) ( 4 ) ( 18 ) ( 21 ) 0 0
+Added: Amortization of net actuarial loss 0 0 0 10 1 1
+Added: Curtailment (gain) loss 0 0 ( 49 ) 0 0 0
+Added: Net periodic (benefit) cost $ 8 $ 9 $ ( 39 ) $ 19 $ 2 $ 1
+Added: During the six months ended June 30, 2023, Aflac Japan contributed approximately $ 12 million (using the weighted-average yen/dollar exchange rate for the six-month period ended June 30, 2023) to the Japanese funded defined benefit plan, and Aflac U.S.
did not make a contribution to the U.S.
4 unchanged sentences
In February 2023, the Company renewed an outsourcing agreement with a management consulting and technology services company to provide application maintenance and development services for Aflac Japan.
−Removed: As of March 31, 2023, the agreement has a remaining term of five years and an aggregate remaining cost of ¥ 20.9 billion ($ 157 million using the March 31, 2023 exchange rate).
+Added: As of June 30, 2023, the agreement has a remaining term of five years and an aggregate remaining cost of ¥ 20.1 billion ($ 138 million using the June 30, 2023 exchange rate).
The Company is a defendant in various lawsuits and receives various regulatory inquiries considered to be in the normal course of business.
8 unchanged sentences
Under state guaranty association laws, certain insurance companies can be assessed (up to prescribed limits) for certain obligations to the policyholders and claimants of impaired or insolvent insurance companies that write the same line or similar lines of business.
−Removed: Guaranty fund assessments for the three-month periods ended March 31, 2023 and 2022 were immaterial.
+Added: Guaranty fund assessments for the three- and six-month periods ended June 30, 2023 and 2022 were immaterial.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.