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Item 8. Financial Statements and Supplementary Data

2025-02-28 compared with 2024-02-22 · 357 added, 449 removed, 2777 unchanged (22% of the section changed)

10 unchanged sentences

Note 1 — Business, Basis of Presentation and Summary of Significant Accounting Policies

Note 2 — ASU 2018-12 Transition

Note 2 — Segment Information

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Note 17 — Contingencies, Commitments and Guarantees

Note 19 — Quarterly Results of Operations (Unaudited)

Note 18 — Subsequent Event

11 unchanged sentences

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 28, 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Notes 1 and 2 to the financial statements, the Company has changed its method of accounting for long-duration contracts due to the adoption of ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts (“ASU 2018-12”), effective January 1, 2023, with a transition date of January 1, 2021.

Basis for Opinion

17 unchanged sentences

Management regularly reviews its cash flow assumptions supporting the estimates of these actuarial liabilities and, if such assumptions change significantly, the associated liability is adjusted.

The measurement of LFPBs can be significantly impacted by changes in economic assumptions related to market interest rates and the general account rate of return and changes in assumptions for policyholder behavior including premium persistency, mortality and lapses.

Given the future policy benefit obligation for certain contracts is sensitive to changes in these economic and policyholder behavior assumptions and the significant uncertainty inherent in estimating these actuarial liabilities, we identified management’s evaluation of these assumptions in the valuation of certain LFPBs as a critical audit matter.

129 unchanged sentences

Comprehensive income (loss)

361 ( 247 ) ( 2,269 )

Comprehensive income (loss) attributable to noncontrolling interests, net of income tax 5 5 5

10 unchanged sentences

Balance at December 31, 2021 $ — $ 1 $ 14,154 $ ( 4,274 ) $ ( 1,543 ) $ 47 $ 8,385 $ 65 $ 8,450

Cumulative effect of change in accounting principle, net of income tax ( 5,383 ) ( 3,929 ) ( 9,312 ) ( 9,312 )

Balance at January 1, 2021 — 1 13,878 ( 5,917 ) ( 1,038 ) 1,787 8,711 65 8,776

Preferred stock issuance — 339 339 339

Treasury stock acquired in connection with share repurchases ( 488 ) ( 488 ) ( 488 )

61 unchanged sentences

Net change in other invested assets ( 372 ) ( 112 ) ( 376 )

Other, net ( 4 ) — —

Net cash provided by (used in) investing activities $ ( 2,194 ) $ ( 3,196 ) $ ( 8,276 )

10 unchanged sentences

Net change in payables for collateral under securities loaned and other transactions 221 ( 890 ) ( 1,709 )

Long-term debt issued — — 400

Long-term debt repaid ( 2 ) ( 2 ) ( 3 )

Preferred stock issued, net of issuance costs — — 339

Dividends on preferred stock ( 102 ) ( 102 ) ( 104 )

21 unchanged sentences

through multiple independent distribution channels and marketing arrangements with a diverse network of distribution partners.

The Company is organized into three segments:

In addition, the Company reports certain of its results of operations in Corporate & Other.

The Company is organized into the following reportable segments:

and Corporate & Other.

Basis of Presentation

10 unchanged sentences

When the Company has virtually no influence over the investee’s operations, the investment is carried at fair value.

Reclassifications

Certain amounts in the prior years’ consolidated financial statements and related footnotes thereto have been reclassified to conform with the 2023 presentation as discussed throughout the Notes to the Consolidated Financial Statements.

See “— Adoption of New Accounting Pronouncements” for discussion of the adoption of new guidance on long-duration contracts as of January 1, 2023, parts of which were retrospectively applied to prior periods presented in the consolidated financial statements.

Summary of Significant Accounting Policies

5 unchanged sentences

The discussion below provides an overview of the different accounting models for insurance contract obligations and the applicability of such models to the Company’s insurance products.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Liability for Future Policy Benefits

4 unchanged sentences

The Company generally aggregates insurance contracts into groupings by issue year, product and segment for determining the net premium ratio and related LFPBs.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

The Company reviews cash flow assumptions regularly, and if they change significantly, LFPBs are adjusted by determining a revised net premium ratio.

25 unchanged sentences

Liabilities for secondary guarantees are presented within future policy benefits with changes in the liabilities reported in policyholder benefits and claims, except for the effects of unrealized investment gains and losses, which are reported in OCI.

The most significant assumptions used in estimating liabilities for secondary guarantees are the general account rate of return, mortality, premium persistency, lapses and withdrawals.

See Note 3 for more information on the effect of changes in assumptions on the measurement of liabilities for secondary guarantees.

Brighthouse Financial, Inc.

1 unchanged sentence

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

The most significant assumptions used in estimating liabilities for secondary guarantees are the general account rate of return, premium persistency, mortality and lapses.

See Note 4 for more information on the effect of changes in assumptions on the measurement of liabilities for secondary guarantees.

Market Risk Benefits on Annuity Guarantees

1 unchanged sentence

MRBs are required to be separated from the deferred annuity host contract and measured at fair value.

The Company establishes MRB assets and liabilities for guaranteed minimum benefits on variable annuity contracts including guaranteed minimum death benefits (“GMDB”), guaranteed minimum income benefits (“GMIB”), guaranteed minimum accumulation benefits (“GMAB”) and guaranteed minimum withdrawal benefits (“GMWB”).

The Company establishes MRB assets and liabilities for guaranteed minimum benefits on variable annuity contracts including guaranteed minimum death benefits, guaranteed minimum income benefits (“GMIB”), guaranteed minimum accumulation benefits (“GMAB”) and guaranteed minimum withdrawal benefits (“GMWB”).

MRB assets are also established for reinsured benefits related to these guarantees.

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The remeasurement gain or loss from updating DPLs is recognized in current period net income along with the related change in LFPBs.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Deposits related to universal life insurance, deferred annuity contracts and investment contracts are credited to policyholder account balances.

1 unchanged sentence

These fees, which are included in universal life and investment-type product policy fees, are recognized when assessed to the contract holder, except for non-level insurance charges which are deferred by the establishment of an unearned revenue liability and amortized over the expected life of the contracts.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Premiums and policy fees are presented net of reinsurance.

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Interest on such deposits is recorded as other revenues or other expenses, as appropriate.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

The funds withheld liability represents amounts withheld by the Company in accordance with the terms of the reinsurance agreements.

1 unchanged sentence

The Company recognizes interest on funds withheld, included in other expenses, at rates defined by the terms of the agreement which may be contractually specified or directly related to the investment portfolio.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Certain funds withheld arrangements may also contain embedded derivatives measured at fair value that are related to the investment return on the assets withheld.

21 unchanged sentences

For fixed maturity securities in an unrealized loss position, when the Company has the intent to sell the security, or it is more likely than not that the Company will be required to sell the security before recovery, the amortized cost basis of the security is written down to fair value through net investment gains (losses).

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

For fixed maturity securities that do not meet the aforementioned criteria, management evaluates whether the decline in estimated fair value has resulted from credit losses or other factors.

3 unchanged sentences

Any changes in the security specific allowance for credit losses are recorded as a provision for (or reversal of) credit loss expense in net investment gains (losses).

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Fixed maturity securities are also evaluated to determine whether any amounts have become uncollectible.

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Other invested assets consist principally of freestanding derivatives with positive estimated fair values which are described in “— Derivatives” below.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Securities Lending Program

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The Company is liable to return to the counterparties the cash collateral received.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Funding Agreements

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When the hedged item matures or is sold, or the forecasted transaction is not probable of occurring, the Company immediately reclassifies any remaining balances in OCI to net derivative gains (losses).

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Embedded Derivatives

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See “— Insurance Contract Obligations” and “— Reinsurance” for additional information on the accounting policies for embedded derivatives.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

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Deferred tax assets and liabilities resulting from temporary differences between the financial reporting and tax bases of assets and liabilities are measured at the balance sheet date using enacted tax rates expected to apply to taxable income in the years the temporary differences are expected to reverse.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

The realization of deferred tax assets depends upon the existence of sufficient taxable income within the carryback or carryforward periods under the tax law in the applicable tax jurisdiction.

2 unchanged sentences

When making such determination, the Company considers many factors, including the jurisdiction in which the deferred tax asset was generated, the length of time that carryforward can be utilized in the various taxing jurisdictions, future taxable income exclusive of reversing temporary differences and carryforwards, future reversals of existing taxable temporary differences, taxable income in prior carryback years, tax planning strategies and the nature, frequency, and amount of cumulative financial reporting income and losses in recent years.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

The Inflation Reduction Act, which was enacted in 2022, established a 15% corporate alternative minimum tax (“CAMT”) for corporations whose average annual adjusted financial statement income for any consecutive three–tax year period ending after December 31, 2021, and preceding the tax year exceeds $1.0 billion.

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Litigation and Other Loss Contingencies

The Company is a party to or involved in a number of legal disputes, including litigation matters and disputes or other matters involving third parties (e.g., vendors, reinsurers or tax or other authorities), and are subject in the ordinary course to a number of regulatory examinations and investigations.

The Company is a party to or involved in a number of legal disputes, including litigation matters, as well as disputes or other matters involving third parties (e.g., vendors, reinsurers or tax or other authorities), and are subject in the ordinary course to a number of regulatory examinations and investigations.

The Company reviews relevant information with respect to litigation and other loss contingencies related to these matters and establishes liabilities when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.

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Brighthouse Services and NELICO are both indirect wholly-owned subsidiaries.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Actuarial gains and losses result from differences between the actual experience and the assumed experience on plan assets or PBO during a particular period and are recorded in accumulated other comprehensive income (loss) (“AOCI”).

1 unchanged sentence

Prior service costs (credit) are recognized in AOCI at the time of the amendment and then amortized into net periodic benefit costs over the average projected future lifetime of all plan participants or projected future working lifetime, as appropriate.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

Net periodic benefit costs are determined using management estimates and actuarial assumptions;

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Except as noted below, there were no significant ASUs adopted during the year ended December 31, 2024.

In March 2022, the FASB issued new guidance on Troubled Debt Restructurings (“TDR”) (ASU 2022-02 , Financial Instruments—Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosures ).

This ASU eliminates TDR recognition and measurement guidance and, instead, requires that an entity evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan.

The amendments also enhance existing disclosure requirements and introduce new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty.

The Company adopted this guidance on January 1, 2023.

This ASU was applied prospectively and did not have a material impact on the consolidated financial statements upon adoption but could change the future recognition and measurement of modified loans and other receivables.

In August 2018, the FASB issued new guidance on long-duration contracts (ASU 2018-12, Financial Services-Insurance (Topic 944):

Targeted Improvements to the Accounting for Long-Duration Contracts (“LDTI”) ).

LDTI is effective for fiscal years beginning after January 1, 2023.

LDTI resulted in significant changes to the measurement, presentation and disclosure requirements for long-duration insurance contracts.

A summary of the most significant changes is provided below:

(1) Guaranteed benefits associated with variable annuity and certain fixed annuity contracts have been classified and presented separately on the consolidated balance sheets as MRBs.

MRBs are now measured at estimated fair value through net income and reported separately on the consolidated statements of operations, except for nonperformance risk changes, which will be recognized in OCI.

(2) Cash flow assumptions used to measure LFPBs on traditional long-duration contracts (including term and non-participating whole life insurance and immediate annuities) have been updated on an annual basis using a retrospective method.

The resulting remeasurement gain or loss is now reported separately on the consolidated statements of operations along with the remeasurement gain or loss on universal life-type contract liabilities.

(3) The discount rate assumption used to measure the liability for traditional long-duration contracts is now based on an upper-medium grade fixed income yield, updated quarterly, with changes recognized in OCI.

(4) DAC for all insurance products are required to be amortized on a constant-level basis over the expected term of the contracts, using amortization methods that are not a function of revenue or profit emergence.

Changes in assumptions used to amortize DAC have been recognized as a revision to future amortization amounts.

(5) There was a significant increase in required disclosures, including disaggregated rollforwards of insurance contract assets and liabilities supplemented by qualitative and quantitative information regarding the cash flows, assumptions, methods and judgements used to measure those balances.

The transition date was January 1, 2021.

MRB changes were required to be applied on a retrospective basis, while the changes for insurance liability assumption updates and DAC amortization were applied to existing carrying amounts on the transition date.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Business, Basis of Presentation and Summary of Significant Accounting Policies (continued)

The cumulative effect, on an after-tax basis, of the adoption of ASU 2018-12 as of the transition date was a $ 5.4 billion decrease to retained earnings and a $ 3.9 billion decrease to AOCI.

See Note 2 for more detailed information on the impacts of the ASU to the Company’s financial statements.

Future Adoption of New Accounting Pronouncements

In November 2023, the FASB issued new guidance on Segment Reporting Disclosures (ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ).

Improvements to Reportable Segment Disclosures (“ASU 2023-07”) ).

This ASU updates reportable segment disclosures primarily through enhanced disclosures about significant segment expenses.

This ASU does not change how a company identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments.

This ASU is effective for fiscal years starting January 1, 2024, and for interim periods starting January 1, 2025, and will be applied on a retrospective basis.

The Company adopted this guidance during fiscal year 2024 on a retrospective basis.

Future Adoption of New Accounting Pronouncements

In November 2024, the FASB issued new guidance on income statement expense disclosures (ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40 ):

Disaggregation of Income Statement Expenses).

This ASU requires public companies to disclose additional disaggregated information about expenses in the notes to financial statements at each interim and annual reporting period.

This ASU is effective for fiscal years starting January 1, 2027, and for interim periods starting January 1, 2028.

This ASU is required to be adopted prospectively with the option of retrospective application.

The Company is currently evaluating the impact of this guidance on its financial statements.

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The Company is currently evaluating the impact of this guidance on its financial statements.

ASU 2018-12 Transition

The Company adopted ASU 2018-12 for LFPBs, DAC and other balances amortized on a basis consistent with DAC by applying the guidance to contracts in-force on the basis of their existing carrying amounts at the transition date.

The Company adopted ASU 2018-12 for MRBs on a fully retrospective basis.

The effect of transition adjustments on stockholders’ equity at January 1, 2021 due to the adoption of ASU 2018-12 was as follows:

Retained Earnings (Deficit) AOCI

(In millions)

Liability for future policy benefits $ ( 436 ) $ ( 2,073 )

Market risk benefits and related adjustments ( 6,237 ) ( 3,454 )

DAC and VOBA — 520

Reinsurance recoverables ( 141 ) 34

Deferred income tax asset

Total $ ( 5,383 ) $ ( 3,929 )

For LFPBs, the transition adjustment to retained earnings relates to instances where net premiums exceed gross premiums resulting in LFPBs being increased to eliminate the premium deficiency.

The premium deficiency primarily relates to structured settlement annuities.

The transition adjustment related to AOCI represents the effect of the requirement to discount LFPBs based on an upper-medium grade fixed income rate as well as the removal of amounts previously recorded in AOCI for the effects of unrealized investment gains and losses.

For MRBs, the transition adjustment to AOCI relates to the cumulative effect of changes in the nonperformance risk between contract issue date and transition date.

In aggregate, the additional spread applied to the risk-free rate decreased from contract inception to the transition date, which had a negative impact on equity.

The remaining difference between the estimated fair value and carrying amount of MRBs at transition, excluding the amounts recorded in AOCI, was recorded as an adjustment to retained earnings as of the transition date.

For DAC and VOBA, the Company removed amounts previously recorded in AOCI for the effect of unrealized investment gains and losses.

For reinsurance, the adjustments to both retained earnings and AOCI were made to align the measurement of reinsurance recoverables with the related LFPBs.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

ASU 2018-12 Transition (continued)

The balances of and changes in LFPBs at January 1, 2021 due to the adoption of ASU 2018-12 were as follows:

Term and Whole Life Insurance Income Annuities Structured Settlement and Pension Risk Transfer Annuities

(In millions)

Balance at December 31, 2020 $ 2,854 $ 4,311 $ 10,115

Removal of related balances in AOCI — ( 203 ) ( 1,784 )

Change in cash flow assumptions 14 ( 171 ) 200

Initial recognition of deferred profit liabilities

Change in discount rate assumptions 536 754 2,770

Adjusted balance at January 1, 2021 3,404 4,867 11,518

Reinsurance recoverable 85 29 102

Adjusted balance at January 1, 2021, net of reinsurance $ 3,319 $ 4,838 $ 11,416

The balance of and changes in liabilities classified as MRBs at January 1, 2021 due to the adoption of ASU 2018-12 were as follows:

Variable Annuities

(In millions)

Balance at December 31, 2020 $ 8,924

Adjustment for the difference between carrying amount and estimated fair value, except for the difference due to nonperformance risk

Adjustment for cumulative effect of changes in nonperformance risk since issuance

Adjusted balance at January 1, 2021 18,388

Reinsurance recoverable 169

Adjusted balance at January 1, 2021, net of reinsurance $ 18,219

The balances of and changes in DAC and VOBA on January 1, 2021 due to the adoption of ASU 2018-12 were as follows:

Variable Annuities Fixed Rate Annuities Index-Linked Annuities Term and Whole Life Insurance Universal Life Insurance

(In millions)

Balance at December 31, 2020 $ 2,440 $ 64 $ 886 $ 527 $ 492

Removal of related amounts in AOCI 472 — — — ( 23 )

Adjusted balance at January 1, 2021 $ 2,912 $ 64 $ 886 $ 527 $ 469

Balance at December 31, 2020 $ 363 $ 76 $ — $ 8 $ 55

Removal of related amounts in AOCI 65 — — — 6

Adjusted balance at January 1, 2021 $ 428 $ 76 $ — $ 8 $ 61

The following tables present amounts previously reported in 2022 and 2021, the effect on those amounts of the change due to the adoption of ASU 2018-12 as described in Note 1, and the currently reported amounts in the Consolidated Balance Sheets and Consolidated Statements of Operations.

See Notes 4, 5, 6 and 7 for more information.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

ASU 2018-12 Transition (continued)

December 31, 2022 December 31, 2021

As Previously

Reported Effect of

Change As Currently

Reported As Previously

Reported Effect of

Change As Currently

(In millions)

Total assets $ 225,580 $ ( 733 ) $ 224,847 $ 259,840 $ 2,417 $ 262,257

Future policy benefits $ 41,569 $ ( 10,072 ) $ 31,497 $ 43,807 $ ( 3,817 ) $ 39,990

Policyholder account balances $ 74,836 $ ( 1,309 ) $ 73,527 $ 66,851 $ ( 1,602 ) $ 65,249

Market risk benefit liabilities $ — $ 10,389 $ 10,389 $ — $ 16,034 $ 16,034

Total liabilities $ 219,542 $ ( 293 ) $ 219,249 $ 243,633 $ 10,174 $ 253,807

Retained earnings (deficit) $ ( 637 ) $ 242 $ ( 395 ) $ ( 642 ) $ ( 3,632 ) $ ( 4,274 )

Accumulated other comprehensive income (loss) $ ( 5,424 ) $ ( 682 ) $ ( 6,106 ) $ 4,172 $ ( 4,125 ) $ 47

Total equity $ 6,038 $ ( 440 ) $ 5,598 $ 16,207 $ ( 7,757 ) $ 8,450

Total liabilities and equity $ 225,580 $ ( 733 ) $ 224,847 $ 259,840 $ 2,417 $ 262,257

Year Ended December 31, 2022 Year Ended December 31, 2021

As Previously

Reported Effect of

Change As Currently

Reported As Previously

Reported Effect of

Change As Currently

(In millions)

Universal life and investment-type product policy fees $ 3,141 $ ( 706 ) $ 2,435 $ 3,636 $ ( 656 ) $ 2,980

Net derivative gains (losses) $ 304 $ ( 896 ) $ ( 592 ) $ ( 2,469 ) $ ( 1,514 ) $ ( 3,983 )

Total revenues $ 8,473 $ ( 1,600 ) $ 6,873 $ 7,142 $ ( 2,166 ) $ 4,976

Policyholder benefits and claims $ 4,165 $ ( 1,972 ) $ 2,193 $ 3,443 $ ( 697 ) $ 2,746

Change in market risk benefits $ — $ ( 4,104 ) $ ( 4,104 ) $ — $ ( 4,134 ) $ ( 4,134 )

Total expenses $ 8,645 $ ( 6,504 ) $ 2,141 $ 7,350 $ ( 4,383 ) $ 2,967

Net income (loss) $ 10 $ 3,874 $ 3,884 $ ( 103 ) $ 1,751 $ 1,648

Segment Information

The Company is organized into three segments:

In addition, the Company reports certain of its results of operations in Corporate & Other.

The Company is organized and provides its products and services through the following reportable segments:

and Corporate & Other.

The Company’s chief operating decision maker (“CODM”) views and manages the business through these segments.

The Annuities segment consists of a variety of variable, fixed, index-linked and income annuities designed to address contract holders’ needs for protected wealth accumulation on a tax-deferred basis, wealth transfer and income security.

The Life segment consists of insurance products, including term, universal, whole and variable life products designed to address policyholders’ needs for financial security and protected wealth transfer, which may be on a tax-advantaged basis.

The Run-off segment consists of products that are no longer actively sold and are separately managed, including ULSG, structured settlements, pension risk transfer contracts, certain company-owned life insurance policies and certain funding agreements.

The Run-off segment consists primarily of products that are no longer actively sold and are separately managed, including ULSG, structured settlements, pension risk transfer contracts, certain company-owned life insurance policies and certain funding agreements.

Brighthouse Financial, Inc.

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Corporate & Other

Corporate & Other contains the excess capital not allocated to the segments and interest expense related to the Company’s outstanding debt, as well as expenses associated with certain legal proceedings and income tax audit issues.

Corporate & Other also includes long-term care business reinsured through 100% quota share reinsurance agreements and activities related to funding agreements associated with the Company’s institutional spread margin business.

In connection with the adoption of ASU 2018-12, the Company reclassified direct-to-consumer life insurance that is no longer sold from Corporate & Other to the Life segment.

The segment information below reflects the direct-to-consumer life insurance in the Life segment for all periods presented.

Financial Measures and Segment Accounting Policies

Adjusted earnings is a financial measure used by management to evaluate performance and facilitate comparisons to industry results.

Consistent with GAAP guidance for segment reporting, adjusted earnings is also used to measure segment performance.

The Corporate & Other segment consists of activities related to funding agreements associated with the Company’s institutional spread margin business, excess capital not allocated to the other segments, interest expense related to the Company’s outstanding debt, and preferred stock dividends, as well as expenses associated with certain legal proceedings and income tax audit issues.

Corporate & Other also includes long-term care business reinsured through 100% quota share reinsurance agreements.

In connection with the adoption of ASU 2023-07, the Company’s presentation of segment information has been updated for all periods.

Financial Measure and Segment Accounting Policies

The Company’s CODM is its Chief Executive Officer (“CEO”).

The CEO uses adjusted earnings to evaluate segment performance and facilitate comparisons to industry results.

The Company believes the presentation of adjusted earnings, as the Company measures it for management purposes, enhances the understanding of its performance by the investor community by highlighting the results of operations and the underlying profitability drivers of the business.

Adjusted earnings, which may be positive or negative, focuses on the Company’s primary businesses by excluding the impact of market volatility, which could distort trends.

The following are significant items excluded from total revenues in calculating adjusted earnings:

The following items are excluded from total revenues in calculating adjusted earnings:

• Net investment gains (losses);

• Net derivative gains (losses), excluding earned income and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment (“Investment Hedge Adjustments”).

The following are significant items excluded from total expenses in calculating adjusted earnings:

The following items are excluded from total expenses in calculating adjusted earnings:

• Change in MRBs;

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The provision for income tax related to adjusted earnings is calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items.

The Company’s adjusted earnings definition and presentation has been updated for all periods presented to reflect the adoption of ASU 2018-12.

The segment accounting policies are the same as those used to prepare the Company’s consolidated financial statements, except for the adjustments to calculate adjusted earnings described above.

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For insurance businesses other than variable annuities, excess capital held is based on a percentage of required statutory risk-based capital (“RBC”).

Assets in excess of those allocated to the segments, if any, are held in Corporate & Other.

Assets in excess of those allocated to the Annuities, Life and Run-off segments, if any, are held in Corporate & Other.

Segment net investment income reflects the performance of each segment’s respective invested assets.

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Segment Information (continued)

Operating results by segment, as well as Corporate & Other, were as follows:

The tables below provide information about the Company’s segments, including significant segment expenses, and reconciliations to Net income (loss) available to common shareholders.

Year Ended December 31, 2024

1 unchanged sentence

(In millions)

Pre-tax adjusted earnings $ 1,437 $ ( 69 ) $ ( 100 ) $ 21 $ 1,289

Total revenues

$ 1,932 $ 1,113 $ 996 $ 683 $ 4,724

Revenues excluded from adjusted earnings (1)

( 3,350 ) ( 22 ) ( 599 ) ( 23 )

Segment expenses:

Policyholder benefits and claims

479 710 1,105 —

Interest credited to policyholder account balances, excluding market value adjustments

1,351 105 243 450

Amortization of DAC and VOBA

Interest expense on debt — — — 152

Other expenses (2)

1,399 188 166 41

Provision for income tax expense (benefit)

Post-tax adjusted earnings 1,169 ( 53 ) ( 77 ) 37 1,076

297 5 16 ( 14 )

Net income (loss) attributable to noncontrolling interests — — — 5

Preferred stock dividends — — — 102

Adjusted earnings $ 1,169 $ ( 53 ) $ ( 77 ) $ ( 70 ) 969

Adjusted earnings (loss)

$ 1,251 $ 33 $ 65 $ ( 30 ) 1,319

Adjustments for:

6 unchanged sentences

Interest revenue $ 2,859 $ 466 $ 1,234 $ 694

Interest expense $ — $ — $ — $ 153

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Segment Information (continued)

Year Ended December 31, 2023

1 unchanged sentence

(In millions)

Pre-tax adjusted earnings $ 1,317 $ 94 $ 109 $ ( 68 ) $ 1,452

Total revenues

$ 944 $ 1,199 $ 1,405 $ 569 $ 4,117

Revenues excluded from adjusted earnings (1)

( 3,934 ) ( 30 ) ( 238 ) ( 56 )

Segment expenses:

Policyholder benefits and claims

480 894 1,302 —

Interest credited to policyholder account balances, excluding market value adjustments

1,054 97 274 388

Amortization of DAC and VOBA

Interest expense on debt

Other expenses (2)

1,391 203 167 63

Provision for income tax expense (benefit)

Post-tax adjusted earnings 1,070 78 87 58 1,293

268 ( 16 ) ( 23 ) ( 16 )

Net income (loss) attributable to noncontrolling interests — — — 5

Preferred stock dividends — — — 102

Adjusted earnings $ 1,070 $ 78 $ 87 $ ( 51 ) 1,184

Adjusted earnings (loss)

$ 1,169 $ ( 53 ) $ ( 77 ) $ ( 70 ) 969

Adjustments for:

6 unchanged sentences

Interest revenue $ 2,568 $ 437 $ 1,141 $ 623

Interest expense $ — $ — $ — $ 153

Brighthouse Financial, Inc.

4 unchanged sentences

(In millions)

Pre-tax adjusted earnings $ 1,589 $ 422 $ 265 $ ( 355 ) $ 1,921

Total revenues

$ 5,492 $ 1,182 $ ( 196 ) $ 395 $ 6,873

Revenues excluded from adjusted earnings (1) 966 ( 31 ) ( 1,901 ) 55

Segment expenses:

Policyholder benefits and claims

380 800 1,013 —

Interest credited to policyholder account balances, excluding market value adjustments

897 75 290 163

Amortization of DAC and VOBA

Interest expense on debt

Other expenses (2)

1,417 130 293 92

Provision for income tax expense (benefit)

Post-tax adjusted earnings 1,286 334 206 ( 246 ) 1,580

247 16 22 ( 126 )

Net income (loss) attributable to noncontrolling interests — — — 5

Preferred stock dividends — — — 104

Adjusted earnings $ 1,286 $ 334 $ 206 $ ( 340 ) 1,486

Adjusted earnings (loss)

$ 1,070 $ 78 $ 87 $ ( 51 ) 1,184

Adjustments for:

6 unchanged sentences

Interest revenue $ 2,261 $ 442 $ 1,166 $ 340

Interest expense $ — $ — $ — $ 163

Total revenues by segment, as well as Corporate & Other, were as follows:

Years Ended December 31,

_______________

(In millions)

Annuities $ 4,878 $ 4,526 $ 4,903

Life 1,229 1,213 1,633

Run-off 1,643 1,705 2,426

Corporate & Other 625 340 77

Adjustments ( 4,258 ) ( 911 ) ( 4,063 )

Total $ 4,117 $ 6,873 $ 4,976

Total assets by segment, as well as Corporate & Other, were as follows at:

(1) For each reportable segment, certain revenues are excluded from adjusted earnings (loss), including net investment gains (losses) and net derivative gains (losses), excluding investment hedge adjustments.

(2) Other expenses include corporate expense allocations directly attributable to each of the segments.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Segment Information (continued)

Total assets by segment were as follows at:

(In millions)

4 unchanged sentences

Total $ 238,537 $ 236,340

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Segment Information (continued)

Total premiums, universal life and investment-type product policy fees and other revenues by major product group were as follows:

9 unchanged sentences

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities

43 unchanged sentences

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities (continued)

The measurement of LFPBs can be significantly impacted by changes in assumptions for policyholder behavior.

As part of the 2023 and 2022 annual actuarial review (“AAR”), the Company updated assumptions regarding mortality and lapses for term and non-participating whole life insurance.

As part of the 2024 and 2023 annual actuarial reviews (“AAR”), the Company updated assumptions regarding mortality and lapses for term and non-participating whole life insurance.

The impact from changes in assumptions is presented in effect of changes in cash flow assumptions in the table above.

11 unchanged sentences

Benefit payments ( 421 ) ( 359 ) ( 447 )

Effect of realized capital gains (losses) — — 2

Ending balance before the effect of unrealized gains and losses 9,277 7,784 7,175

6 unchanged sentences

Gross assessments recognized during period $ 1,083 $ 1,064 $ 1,070

The measurement of liabilities for secondary guarantees can be significantly impacted by changes in the expected general account rate of return, which is driven by the Company’s assumption for long-term treasury yields.

The measurement of liabilities for secondary guarantees can be significantly impacted by changes in assumptions for policyholder behavior, as well as the expected general account rate of return, which is driven by the Company’s assumption for long-term treasury yields.

The Company’s practice of projecting treasury yields uses a mean reversion approach that assumes that long-term interest rates are less influenced by short-term fluctuations and are only changed when sustained interim deviations are expected.

As part of the 2023 AAR, the Company increased the long-term general account earned rate, driven by an increase in the mean reversion rate from 3.50 % to 3.75 %.

The Company also updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses, withdrawals and maintenance expenses.

As part of the 2022 AAR, the Company increased the long-term general account earned rate, driven by an increase in the mean reversion rate from 3.00 % to 3.50 %.

Both period assumption updates are reflected in the table above.

As part of the 2024 and 2023 AARs, the Company updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses and withdrawals.

In 2024, the Company also increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 3.75 % to 4.00 %.

The impact from changes in assumptions, excluding the effects on the ULSG liability for profits followed by losses, is presented in effect of changes in cash flow assumptions in the table above.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities (continued)

A reconciliation of the net LFPBs for nonparticipating traditional and limited-payment contracts and the additional insurance liabilities for universal life-type contracts with secondary guarantees reported in the preceding rollforward tables to LFPBs on the consolidated balance sheets was as follows at:

A reconciliation of the net LFPBs for non-participating traditional and limited-payment contracts and the additional insurance liabilities for universal life-type contracts with secondary guarantees reported in the preceding rollforward tables to LFPBs on the consolidated balance sheets was as follows at:

(In millions)

8 unchanged sentences

(1) Includes liabilities related to fully reinsured individual long-term care insurance.

See Notes 2 and 7.

(2) Participating whole life insurance uses an interest assumption based on the non-forfeiture interest rate, ranging from 3.5 % to 4.5 %, and mortality rates guaranteed in calculating the cash surrender values described in such contracts, and also includes a liability for terminal dividends.

1 unchanged sentence

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities (continued)

40 unchanged sentences

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities (continued)

3 unchanged sentences

Funding agreements classified as investment contracts 11,002 11,115

Institutional group annuities

Other investment contract liabilities 979 1,092

Total policyholder account balances $ 87,989 $ 81,068

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities (continued)

The balance of account values by range of guaranteed minimum crediting rates and the related range of difference, in basis points, between rates being credited to policyholders and the respective guaranteed minimums was as follows at:

4 unchanged sentences

Less than 2.00 %

$ 562 $ 126 $ 240 $ 8,769 $ 9,697

2.00 % to 3.99 %

7,160 462 492 385 8,499

Greater than 3.99 %

783 — — — 783

Total $ 8,505 $ 588 $ 732 $ 9,154 $ 18,979

1 unchanged sentence

Less than 2.00 %

$ — $ — $ — $ 317 $ 317

2.00 % to 3.99 %

— 522 48 131 701

Greater than 3.99 %

1,530 — — — 1,530

Total $ 1,530 $ 522 $ 48 $ 448 $ 2,548

Less than 2.00 %

$ — $ — $ — $ — $ —

2.00 % to 3.99 %

1,052 1,386 1,602 238 4,278

Greater than 3.99 %

484 — — — 484

Total $ 1,536 $ 1,386 $ 1,602 $ 238 $ 4,762

2 unchanged sentences

Less than 2.00 %

$ 697 $ 223 $ 310 $ 7,652 $ 8,882

2.00 % to 3.99 %

8,827 242 225 356 9,650

Greater than 3.99 %

874 — — — 874

Total $ 10,398 $ 465 $ 535 $ 8,008 $ 19,406

1 unchanged sentence

Less than 2.00 %

$ — $ — $ — $ 236 $ 236

2.00 % to 3.99 %

— 492 49 136 677

Greater than 3.99 %

1,595 — — — 1,595

Total $ 1,595 $ 492 $ 49 $ 372 $ 2,508

Less than 2.00 %

$ — $ — $ — $ — $ —

2.00 % to 3.99 %

1,135 1,485 1,663 254 4,537

Greater than 3.99 %

506 — — — 506

Total $ 1,641 $ 1,485 $ 1,663 $ 254 $ 5,043

1 unchanged sentence

(1) Includes policyholder account balances for fixed rate annuities and the fixed account portion of variable annuities.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements

Insurance Liabilities (continued)

(2) Includes policyholder account balances for retained asset accounts, universal life policies and the fixed account portion of universal variable life insurance policies.

1 unchanged sentence

See Note 5 for information regarding net amount at risk and cash surrender values.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Insurance Liabilities (continued)

Obligations Under Funding Agreements

2 unchanged sentences

The Company had obligations outstanding under these funding agreements of $ 5.5 billion at both December 31, 2024 and 2023.

Brighthouse Life Insurance Company has a secured funding agreement program with the Federal Home Loan Bank (“FHLB”) of Atlanta.

The Company had obligations outstanding under this program of $ 4.4 billion and $ 3.9 billion at December 31, 2023 and 2022, respectively.

Funding agreements are issued to FHLBs in exchange for cash, for which the FHLBs have been granted liens on certain assets, some of which are in their custody to collateralize the Company’s obligations under the funding agreements.

The Company is permitted to withdraw any portion of the collateral in the custody of the FHLBs as long as there is no event of default and the remaining qualified collateral is sufficient to satisfy the collateral maintenance level.

Upon any event of default by the Company, the FHLBs’ recovery on the collateral is limited to the amount of the Company’s liabilities to the FHLBs.

See Note 9 for information on invested assets pledged as collateral in connection with funding agreements.

Brighthouse Life Insurance Company has a secured funding agreement program with the Federal Agricultural Mortgage Corporation and its affiliate Farmer Mac Mortgage Securities Corporation (“Farmer Mac”).

The Company had obligations outstanding under this program of $ 700 million at both December 31, 2023 and 2022.

Funding agreements are issued to Farmer Mac in exchange for cash, for which Farmer Mac have been granted liens on certain assets to collateralize the Company’s obligations under the funding agreements.

Upon any event of default by the Company, Farmer Mac’s recovery on the collateral is limited to the amount of the Company’s liabilities to Farmer Mac.

Brighthouse Life Insurance Company established a secured funding agreement-backed repurchase agreement program in January 2024.

Brighthouse Life Insurance Company may enter into repurchase agreements with bank counterparties and the proceeds of the repurchase agreements are then used by a special purpose entity to purchase funding agreements from Brighthouse Life Insurance Company.

The Company had obligations under this program of $ 500 million at December 31, 2024.

Brighthouse Life Insurance Company has a secured funding agreement program with the Federal Home Loan Bank (“FHLB”) of Atlanta and the Federal Agricultural Mortgage Corporation and its affiliate Farmer Mac Mortgage Securities Corporation (“Farmer Mac”).

Funding agreements are issued to FHLB and Farmer Mac in exchange for cash, for which these programs have been granted liens on certain assets, some of which are in their custody to collateralize the Company’s obligations under the funding agreements.

Upon any event of default by the Company, the program recovery on the collateral is limited to the amount of the Company’s liabilities to FHLB and Farmer Mac, respectively.

The Company had obligations outstanding under these programs of $ 5.0 billion and $ 5.1 billion at December 31, 2024 and 2023, respectively.

See Note 8 for information on invested assets pledged as collateral in connection with funding agreements.

Inactive Funding Agreement Programs

Brighthouse Life Insurance Company has obligations outstanding under inactive funding agreement programs of $ 525 million at both December 31, 2023 and 2022.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Brighthouse Life Insurance Company had obligations outstanding under inactive funding agreement programs of $ 25 million and $ 525 million at December 31, 2024 and 2023, respectively.

Market Risk Benefits

23 unchanged sentences

(1) Amounts represent the sum of MRB assets and MRB liabilities presented on the consolidated balance sheets at December 31, 2024, 2023 and 2022, with the exception of $ 21 million, $ 9 million and $ 3 million, respectively, of index-linked annuities not included in this table.

Market conditions, including, but not limited to, changes in interest rates, equity indices, market volatility and variations in actuarial assumptions, including policyholder behavior, mortality and risk margins related to non-capital markets inputs, as well as changes in nonperformance risk, may result in significant fluctuations in the estimated fair value of the guarantees.

As part of the AAR in 2023 and 2022, the Company updated assumptions regarding policyholder behavior, mortality, separate account fund allocations and volatility, which are reflected in the table above.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Market Risk Benefits (continued)

As part of the 2024 AAR, the Company updated assumptions regarding policyholder behavior, mortality and separate account fund allocations.

As part of the 2023 AAR, the Company updated assumptions regarding policyholder behavior, mortality, separate account fund allocations and volatility.

The impact from changes in assumptions is presented in effect of changes in future expected assumptions in the table above.

Separate Accounts

67 unchanged sentences

(In millions)

Adjusted balance at January 1, 2021 (1) $ 2,912 $ 64 $ 886 $ 527 $ 469

Balance at January 1, 2022

$ 2,718 $ 89 $ 1,081 $ 462 $ 431

Capitalization 55 30 330 ( 1 ) 11

1 unchanged sentence

Balance at December 31, 2022

2,508 107 1,213 405 392

Capitalization 36 14 343 2 13

1 unchanged sentence

Balance at December 31, 2023

2,301 110 1,331 354 360

Capitalization 39 8 373 4 13

1 unchanged sentence

Balance at December 31, 2024

Adjusted balance at January 1, 2021 (1) $ 428 $ 76 $ — $ 8 $ 61

$ 2,116 $ 115 $ 1,462 $ 310 $ 332

Balance at January 1, 2022

$ 377 $ 70 $ — $ 6 $ 54

Amortization ( 36 ) ( 5 ) — ( 1 ) ( 6 )

Balance at December 31, 2022

341 65 — 5 48

Amortization ( 32 ) ( 5 ) — ( 1 ) ( 5 )

Balance at December 31, 2023

309 60 — 4 43

Amortization ( 30 ) ( 5 ) — ( 1 ) ( 5 )

Balance at December 31, 2024

$ 279 $ 55 $ — $ 3 $ 38

Total DAC and VOBA:

Balance at December 31, 2024

$ 2,395 $ 170 $ 1,462 $ 313 $ 370

Balance at December 31, 2023

$ 2,610 $ 170 $ 1,331 $ 358 $ 403

Balance at December 31, 2022

$ 2,849 $ 172 $ 1,213 $ 410 $ 440

(1) Includes an adjustment to eliminate balances included in AOCI related to the adoption of ASU 2018-12 (see Note 2).

Deferred Sales Inducements

9 unchanged sentences

Notes to the Consolidated Financial Statements (continued)

Deferred Policy Acquisition Costs, Value of Business Acquired and Deferred Sales Inducements (continued)

Deferred Policy Acquisition Costs, Value of Business Acquired and Other Intangibles (continued)

Unearned Revenue

44 unchanged sentences

Impairments are then determined based on probable and estimable defaults.

The Company had an allowance for credit losses of $ 3 million and $ 10 million on its reinsurance recoverable balances at December 31, 2023 and 2022, respectively.

In 2023, the Company had $ 3 million of additions to the allowance and $ 10 million of impairments charged against the allowance.

The Company had an allowance for credit losses of $ 3 million on its reinsurance recoverable balances at both December 31, 2024 and 2023.

At December 31, 2024, the Company had $ 19.8 billion of net ceded reinsurance recoverables with third-party reinsurers.

57 unchanged sentences

December 31, 2024 December 31, 2023

Cost Allowance for Credit Losses Gross Unrealized Estimated

Amortized Cost

Allowance for Credit Losses Gross Unrealized Estimated Fair Value

Amortized Cost

Allowance for Credit Losses Gross Unrealized Estimated Fair Value

Gains Losses Gains Losses

2 unchanged sentences

Foreign corporate 13,284 26 53 1,481 11,830 12,865 — 89 1,289 11,665

8,120 4 46 875 7,287 8,199 5 48 812 7,430

government and agency 7,408 — 40 701 6,747 8,656 — 286 523 8,419

RMBS 8,199 5 48 812 7,430 8,431 2 44 945 7,528

CMBS 7,023 1 2 614 6,410 7,324 3 — 710 6,611

ABS 6,514 — 23 131 6,406 5,652 — 3 296 5,359

6,776 4 6 422 6,356 7,023 1 2 614 6,410

6,354 — 33 75 6,312 6,514 — 23 131 6,406

State and political subdivision 3,731 — 81 371 3,441 4,019 — 159 304 3,874

1 unchanged sentence

Total fixed maturity securities $ 87,603 $ 81 $ 498 $ 7,965 $ 80,055 $ 87,131 $ 21 $ 1,037 $ 7,156 $ 80,991

The Company held non-income producing fixed maturity securities with an estimated fair value of $ 52 million at December 31, 2023.

The Company did not hold non-income producing fixed maturity securities at December 31, 2022.

The Company held non-income producing fixed maturity securities with an estimated fair value of $ 30 million and $ 52 million at December 31, 2024 and 2023, respectively.

Maturities of Fixed Maturity Securities

20 unchanged sentences

Foreign corporate 3,277 351 5,560 1,130 1,010 73 8,311 1,216

government and agency 518 9 3,477 514 3,121 265 1,147 337

RMBS 1,223 81 4,647 794 413 20 5,774 792

government and agency 2,457 118 1,884 583 518 9 3,477 514

CMBS 1,326 90 4,402 332 411 33 5,786 581

41 unchanged sentences

Rollforward of the Allowance for Credit Losses for Fixed Maturity Securities by Sector

The changes in the allowance for credit losses by sector were as follows:

Corporate RMBS CMBS Foreign Corporate Total

The changes in the allowance for credit losses for fixed maturity securities by sector were as follows:

Corporate Foreign Corporate RMBS CMBS Total

(In millions)

Balance at December 31, 2022

$ 1 $ 1 $ 2 $ 3 $ 7

Allowance on securities where credit losses were not previously recorded 15 — 3 — 18

26 unchanged sentences

_______________

(1) Purchases of mortgage loans from third parties were $ 311 million and $ 2.2 billion for the years ended December 31, 2023 and 2022, respectively, and were primarily comprised of residential mortgage loans.

(1) Purchases of mortgage loans from third parties were $ 1.0 billion and $ 311 million for the years ended December 31, 2024 and 2023, respectively, and were primarily comprised of residential mortgage loans.

Allowance for Credit Losses for Mortgage Loans

39 unchanged sentences

$ 106 $ 30 $ 42 $ 178

PCD Mortgage Loans

There were no new purchases of PCD mortgage loans during the year ended December 31, 2023.

Purchases of PCD mortgage loans were $ 69 million at December 31, 2022.

Brighthouse Financial, Inc.

17 unchanged sentences

65% to 75% — 18 80 113 6 20 237

76% to 80% — — — — 1 — 1

Greater than 80% — — — — — 16 16

19 unchanged sentences

65% to 75% 1 127 108 6 30 17 289

76% to 80% — — — — — — —

Greater than 80% — — — — — — —

27 unchanged sentences

Past Due Mortgage Loans by Portfolio Segment

The Company has a high-quality, well-performing mortgage loan portfolio, with over 99 % of all mortgage loans classified as performing at both December 31, 2023 and 2022.

The Company has a high-quality, well-performing mortgage loan portfolio, with 99 % of all mortgage loans classified as performing at both December 31, 2024 and 2023.

Delinquency is defined consistent with industry practice, when mortgage loans are past due as follows:

commercial and residential mortgage loans — 60 days and agricultural mortgage loans — 90 days.

commercial and residential mortgage loans — 60 days;

and agricultural mortgage loans — 90 days.

The aging of the amortized cost of past due mortgage loans by portfolio segment was as follows at:

16 unchanged sentences

December 31, 2024 $ 120 $ 25 $ 118 $ 263

$ 17 $ — $ 90 $ 107

December 31, 2023 $ 17 $ — $ 90 $ 107

_______________

(1) The Company had no mortgage loans in nonaccrual status for which there was no related allowance for credit losses at both December 31, 2023 and 2022.

Current period investment income on mortgage loans in nonaccrual status was $ 2 million for both years ended December 31, 2023 and 2022.

(1) The Company had $ 3 million of mortgage loans in nonaccrual status for which there was no related allowance for credit losses at December 31, 2024.

The Company did not have any mortgage loans in nonaccrual status for which there was no related allowance for credit losses at December 31, 2023.

Current period investment income on mortgage loans in nonaccrual status was $ 6 million and $ 2 million for December 31, 2024 and 2023, respectively.

Modified Mortgage Loans by Portfolio Segment

1 unchanged sentence

Generally, the types of concessions may include interest rate reduction, term extension, principal forgiveness, or a combination of all three.

The Company did not have a significant amount of mortgage loans modified during both years ended December 31, 2023 and 2022.

As of December 31, 2024, the Company has $ 386 million of commercial mortgage loans that were modified under a term extension during the year which represent 2 % of the carrying value of total mortgage loans.

All commercial mortgage loans that were modified are current as of December 31, 2024.

The Company did not have a significant amount of agricultural and residential mortgage loans modified during the year ended December 31, 2024.

The Company did not have a significant amount of mortgage loans modified during the year ended December 31, 2023.

Other Invested Assets

1 unchanged sentence

See Note 9 for information about freestanding derivatives with positive estimated fair values.

Other invested assets also includes the Company’s investment in company-owned life insurance, FHLB stock, tax credit and renewable energy partnerships and leveraged leases.

Other invested assets also includes the Company’s investment in company-owned life insurance, FHLB stock, leveraged leases and tax credit and renewable energy partnerships.

Leveraged Leases

The carrying value of leveraged leases was $ 60 million and $ 47 million at December 31, 2024 and 2023, respectively.

The allowance for credit losses was $ 13 million at both December 31, 2023 and 2022.

The allowance for credit losses was less than $ 1 million and $ 13 million at December 31, 2024 and 2023, respectively.

Rental receivables are generally due in periodic installments.

The payment periods for leveraged leases generally range from one to nine years .

The payment periods for leveraged leases generally range from one to eight years .

For rental receivables, the primary credit quality indicator is whether the rental receivable is performing or nonperforming, which is assessed monthly.

1 unchanged sentence

At both December 31, 2024 and 2023, all leveraged leases were performing.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Investments (continued)

Net Unrealized Investment Gains (Losses)

12 unchanged sentences

Net unrealized investment gains (losses) $ ( 4,766 ) $ ( 4,040 ) $ ( 5,690 )

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Investments (continued)

The changes in net unrealized investment gains (losses) were as follows:

2 unchanged sentences

(In millions)

Balance at December 31,

$ ( 5,690 ) $ 5,524 $ 5,761

Unrealized investment gains (losses) change due to cumulative effect, net of income tax — — 1,980

Balance at January 1, $ ( 4,040 ) $ ( 5,690 ) $ 5,524

19 unchanged sentences

(2) Included in payables for collateral under securities loaned and other transactions.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Investments (continued)

The cash collateral liability by loaned security type and remaining tenor of the agreements were as follows at:

9 unchanged sentences

(1) The related loaned security could be returned to the Company on the next business day which would require the Company to immediately return the cash collateral.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Investments (continued)

If the Company is required to return significant amounts of cash collateral on short notice and is forced to sell securities to meet the return obligation, it may have difficulty selling such collateral that is invested in securities in a timely manner, be forced to sell securities in a volatile or illiquid market for less than what otherwise would have been realized in normal market conditions, or both.

2 unchanged sentences

The reinvestment portfolio acquired with the cash collateral consisted principally of fixed maturity securities (including agency RMBS, ABS, U.S.

government and agency securities, U.S.

and foreign corporate securities, non-agency RMBS and CMBS) with 56 % invested in agency RMBS, U.S.

and foreign corporate securities, U.S.

government and agency securities, non-agency RMBS and CMBS) with 51 % invested in agency RMBS, U.S.

government and agency securities and cash and cash equivalents at December 31, 2024.

13 unchanged sentences

In addition, the Company’s investment in FHLB common stock, which is considered restricted until redeemed by the issuer, was $ 222 million and $ 245 million at redemption value at December 31, 2024 and 2023, respectively.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Investments (continued)

Collectively Significant Equity Method Investments

6 unchanged sentences

This aggregated summarized financial data does not represent the Company’s proportionate share of the assets, liabilities or earnings of such entities.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Investments (continued)

The aggregated summarized financial data presented below reflects the latest available financial information and is as of and for the years ended December 31, 2024, 2023 and 2022.

55 unchanged sentences

_______________

(1) Includes net investment income pertaining to other limited partnership interests of $ 187 million, $ 170 million and $ 1.3 billion for the years ended December 31, 2023, 2022 and 2021, respectively.

(1) Includes net investment income pertaining to other limited partnership interests of $ 367 million, $ 187 million and $ 170 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Brighthouse Financial, Inc.

24 unchanged sentences

Net investment gains (losses) $ ( 173 ) $ ( 201 ) $ ( 184 )

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Accounting for Derivatives

5 unchanged sentences

Certain of the Company’s OTC derivatives are cleared and settled through central clearing counterparties (“OTC-cleared”), while others are bilateral contracts between two counterparties (“OTC-bilateral”).

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Derivatives (continued)

Interest Rate Derivatives

The Company uses derivatives to manage its exposure to changes in interest rate risk from its product liabilities and invested assets.

The most significant types of derivative instruments used for hedging interest rate risk are as follows:

Interest rate swaps:

The Company uses interest rate swaps to manage the interest rate risks primarily in variable annuity products and ULSG.

Interest rate swaps are used in non-qualifying hedging relationships.

Interest rate caps:

The Company uses interest rate caps to protect its floating rate liabilities against rises in interest rates above a specified level, and against interest rate exposure arising from mismatches between assets and liabilities.

Interest rate caps are used in non-qualifying hedging relationships.

Interest rate floors:

The Company uses interest rate floors to protect against a decline in interest rates on floating rate assets in the Company’s institutional spread margin business.

Interest rate floors are used in non-qualifying hedging relationships.

The Company uses interest rate swaps to manage interest rate risk in both qualified cash flow and non-qualifying hedging relationships.

In an interest rate swap, the Company agrees with another party to exchange, at specified intervals, the difference between fixed rate and floating rate interest amounts as calculated by reference to an agreed notional amount.

Interest rate swaptions:

The Company uses interest rate swaptions to manage the interest rate risks primarily in variable annuity products and ULSG.

Interest rate swaptions are used in non-qualifying hedging relationships.

The Company uses interest rate swaptions to manage interest rate risk in non-qualifying hedging relationships.

A swaption is an option to enter into a swap with a forward starting effective date.

The Company pays a premium for purchased swaptions and receives a premium for written swaptions.

Interest rate swaptions are included in interest rate options.

Interest rate forwards:

The Company uses interest rate forwards to manage the interest rate risks primarily in variable annuity products and ULSG.

Interest rate forwards are used in cash flow and non-qualifying hedging relationships.

The Company uses interest rate forwards to manage interest rate risk in both qualified cash flow and non-qualifying hedging relationships.

An interest rate forward is an agreement between parties to exchange a future settlement amount based on a predetermined notional amount and forward interest rate.

Foreign Currency Exchange Rate Derivatives

8 unchanged sentences

Credit default swaps:

The Company uses credit default swaps to create synthetic credit investments to replicate credit exposure that is more economically attractive than what is available in the market or otherwise unavailable (written credit protection), or to reduce credit loss exposure on certain assets that the Company owns (purchased credit protection).

Credit default swaps are used in non-qualifying hedging relationships.

4 unchanged sentences

Credit default swaptions are used in non-qualifying hedging relationships.

Equity Market Derivatives

The Company uses derivatives to manage its exposure to equity markets from its product liabilities.

The most significant types of derivative instruments used for hedging equity market risk are as follows:

Equity total return swaps:

The Company uses equity total return swaps in non-qualifying hedge relationships to manage equity risks related to variable and index-linked annuities.

Total return swaps are swaps whereby the Company agrees with another party to exchange, at specified intervals, the difference between the economic risk and reward of an asset or a market index and a floating rate, calculated by reference to an agreed notional amount.

Equity index options:

The Company uses equity index options to manage equity risks related to variable and index-linked annuities in non-qualifying hedging relationships.

In an equity index option transaction, the Company enters into contracts to buy or sell the equity index within a limited time at a contracted price.

In certain instances, the Company may enter into a combination of transactions to hedge adverse changes in equity indices within a pre-determined range through the purchase and sale of options.

Brighthouse Financial, Inc.

1 unchanged sentence

Derivatives (continued)

Equity Market Derivatives

Equity index options:

The Company uses equity index options primarily to hedge minimum guarantees embedded in certain variable annuity products against adverse changes in equity markets.

Additionally, the Company uses equity index options to hedge index-linked annuity products and certain invested assets against adverse changes in equity markets.

Certain of these contracts may also contain settlement provisions linked to interest rates (“hybrid options”).

Equity index options are used in non-qualifying hedging relationships.

Equity total return swaps:

The Company uses equity total return swaps to hedge minimum guarantees embedded in certain variable annuity products against adverse changes in equity markets.

Additionally, the Company uses equity total return swaps to hedge index-linked annuity products against adverse changes in equity markets.

Equity total return swaps are used in non-qualifying hedging relationships.

Equity variance swaps:

The Company uses equity variance swaps to hedge minimum guarantees embedded in certain variable annuity products offered by the Company.

Equity variance swaps are used in non-qualifying hedging relationships.

Primary Risks Managed by Derivatives

5 unchanged sentences

Cash flow hedges:

Interest rate forwards Interest rate $ — $ — $ — $ 60 $ — $ 12

Interest rate swaps Interest rate $ 500 $ 9 $ — $ — $ — $ —

Foreign currency swaps Foreign currency exchange rate 3,823 439 25 3,939 348 45

4 unchanged sentences

Interest rate caps Interest rate 7,850 14 14 7,050 19 1

Interest rate futures Interest rate 171 — — — — —

Interest rate options Interest rate 23,060 11 371 33,680 47 167

3 unchanged sentences

Credit default swaps — written Credit 780 19 — 1,405 27 —

Credit default swaptions Credit — — — 100 — —

Equity futures

Equity market

316 — 1 — — —

Equity index options Equity market 39,897 1,722 1,041 20,099 757 687

13 unchanged sentences

Year Ended December 31, 2024

Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Amount of Gains (Losses) Deferred in AOCI

Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Policyholder Benefits and Claims Amount of Gains (Losses) Deferred in AOCI

(In millions)

13 unchanged sentences

Year Ended December 31, 2023

Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Amount of Gains (Losses) Deferred in AOCI

(In millions)

16 unchanged sentences

Year Ended December 31, 2022

Net Derivative Gains (Losses) Recognized for Derivatives Net Derivative Gains (Losses) Recognized for Hedged Items Net Investment Income Amount of Gains (Losses) Deferred in AOCI

(In millions)

12 unchanged sentences

Total $ ( 532 ) $ ( 60 ) $ 57 $ — $ 331

At December 31, 2023, the Company held no qualified derivatives hedging exposure to future cash flows for forecasted asset purchases.

At December 31, 2022, the maximum length of time over which the Company was hedging its exposure to variability in future cash flows for forecasted transactions was less than one year .

At December 31, 2024 and 2023, the Company held no qualified derivatives hedging exposure to future cash flows for forecasted asset purchases.

At December 31, 2024 and 2023, the balance in AOCI associated with cash flow hedges was $ 469 million and $ 351 million, respectively.

91 unchanged sentences

Foreign corporate — 11,434 396 11,830

government and agency 3,786 4,633 — 8,419

— 7,270 17 7,287

government and agency 2,731 4,016 — 6,747

CMBS — 6,330 26 6,356

11 unchanged sentences

Total derivative assets — 4,126 9 4,135

Embedded derivatives on index-linked annuities (2)

Market risk benefit assets

— — 1,092 1,092

Separate account assets 3 85,633 — 85,636

4 unchanged sentences

Foreign currency exchange rate — 25 — 25

Credit — — — —

Equity market 1 2,487 — 2,488

13 unchanged sentences

Foreign corporate — 11,340 325 11,665

government and agency 3,566 4,450 — 8,016

RMBS — 7,415 15 7,430

government and agency 3,786 4,633 — 8,419

CMBS — 6,371 39 6,410

11 unchanged sentences

Total derivative assets — 3,696 18 3,714

Embedded derivatives on index-linked annuities (2)

Market risk benefit assets

6 unchanged sentences

Foreign currency exchange rate — 55 — 55

Credit — — 2 2

Equity market — 2,824 — 2,824

6 unchanged sentences

The amounts are presented gross in the tables above to reflect the presentation on the consolidated balance sheets.

(2) Embedded derivative assets on index-linked annuities are reported in premiums and other receivables.

Embedded derivative liabilities on index-linked annuities are reported in policyholder account balances.

3 unchanged sentences

The valuation methodologies for securities, mortgage loans and derivatives are reviewed on an ongoing basis and revised when necessary.

In addition, the Chief Accounting Officer periodically reports to the Audit Committee of Brighthouse Financial’s Board of Directors regarding compliance with fair value accounting standards.

In addition, the Chief Accounting Officer periodically reports to the Audit Committee of BHF’s Board of Directors regarding compliance with fair value accounting standards.

Brighthouse Financial, Inc.

97 unchanged sentences

Market Risk Benefits

Variable annuity guaranteed minimum benefits • Option pricing techniques • Mortality rates 0.04 % - 12.90 % 0.04 % - 12.90 % Decrease (1)

Variable annuity guaranteed minimum benefits • Discounted cash flows

• Mortality rates 0.04 % - 12.90 % 0.04 % - 12.90 % Decrease (1)

• Lapse rates 1.00 % - 20.20 % 1.00 % - 22.80 % Decrease (2)

4 unchanged sentences

Embedded Derivatives

Index-linked annuity crediting rates

Registered index-linked annuity crediting rates

• Option pricing techniques • Mortality rates 0.03 % - 7.86 % 0.03 % - 9.24 % Decrease (1)

21 unchanged sentences

For any given contract, long-term equity volatility rates vary throughout the period over which cash flows are projected for purposes of valuing MRBs.

(6) Nonperformance risk spread varies by duration.

For any given contract, multiple nonperformance risk spreads will apply, depending on the duration of the cash flow being discounted for purposes of valuing the MRB or embedded derivative.

Brighthouse Financial, Inc.

1 unchanged sentence

Fair Value (continued)

(6) Nonperformance risk spread varies by duration.

For any given contract, multiple nonperformance risk spreads will apply, depending on the duration of the cash flow being discounted for purposes of valuing the MRB or embedded derivative.

The Company does not develop unobservable inputs used in measuring fair value for all other assets and liabilities classified within Level 3;

1 unchanged sentence

The other Level 3 assets and liabilities primarily included fixed maturity securities and derivatives.

For fixed maturity securities valued based on non-binding broker quotes, an increase (decrease) in credit spreads would result in a higher (lower) fair value.

For derivatives valued based on third-party pricing models, an increase (decrease) in credit spreads would generally result in a higher (lower) fair value.

For fixed maturity securities valued based on non-binding broker quotes, an increase (decrease) in credit spreads would result in a (lower) higher fair value.

For derivatives valued based on third-party pricing models, an increase (decrease) in credit spreads would generally result in a (lower) higher fair value.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Fair Value (continued)

The changes in assets and (liabilities) measured at estimated fair value on a recurring basis using significant unobservable inputs (excluding MRBs disclosed in Note 4) were summarized as follows:

57 unchanged sentences

_______________

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Fair Value (continued)

(1) Comprised of U.S.

1 unchanged sentence

(2) Freestanding derivative assets and liabilities are reported net for purposes of the rollforward.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Fair Value (continued)

(3) Amortization of premium/accretion of discount is included in net investment income.

59 unchanged sentences

(3) Includes unamortized debt issuance costs, discounts and premiums, as applicable, totaling net $ 27 million and $ 30 million for the senior notes and junior subordinated debentures on a combined basis at December 31, 2024 and 2023, respectively.

The aggregate maturities of long-term debt at December 31, 2023 were $ 2 million in 2024, $ 3 million in each of 2025 and 2026, $ 761 million in 2027, $ 3 million in 2028, and $ 2.4 billion thereafter.

The aggregate maturities of long-term debt at December 31, 2024 were $ 3 million in 2025 and 2026, $ 761 million in 2027, $ 3 million in 2028, $ 4 million in 2029, and $ 2.4 billion thereafter.

Unsecured senior notes rank highest in priority, followed by subordinated debt consisting of junior subordinated debentures.

6 unchanged sentences

At December 31, 2024, the Company was in compliance with these financial covenants.

In November 2021, BHF used the net proceeds from the issuances of the Series D Depositary Shares (as defined in Note 13) and the 2051 Senior Notes (as defined below) to repurchase $ 543 million principal amount of senior notes due 2027 and $ 136 million principal amount of senior notes due 2047.

In connection with this repurchase, BHF recorded a premium of $ 71 million paid in excess of the debt principal and wrote off $ 4 million of unamortized debt issuance costs, which is included in other expenses.

In November 2021, BHF issued $ 400 million aggregate principal amount of senior notes due December 2051 (the “2051 Senior Notes”) for aggregate net cash proceeds of $ 396 million.

The 2051 Senior Notes bear interest at a fixed rate of 3.850 %, payable semi-annually.

Credit Facilities

77 unchanged sentences

On November 16, 2023, BHF authorized the repurchase of up to $ 750 million of its common stock, which is in addition to the $ 1.2 billion total repurchases authorized in 2021.

Repurchases under the November 16, 2023 authorization may be made through open market purchases, including pursuant to a 10b5-1 plan or pursuant to accelerated stock repurchase plans, or through privately negotiated transactions, from time to time at management’s discretion in accordance with applicable legal requirements.

During the years ended December 31, 2023, 2022 and 2021, BHF repurchased 5,195,832 shares, 10,000,026 shares and 10,703,165 shares, respectively, of its common stock through open market purchases pursuant to 10b5-1 plans for $ 250 million, $ 488 million and $ 499 million, respectively.

Repurchases under the November 16, 2023 authorization may be made through open market purchases, including pursuant to a Rule 10b5-1 plan or pursuant to accelerated stock repurchase plans, or through privately negotiated transactions, from time to time at management’s discretion in accordance with applicable legal requirements.

During the years ended December 31, 2024, 2023 and 2022, BHF repurchased 5,294,200 shares, 5,195,832 shares and 10,000,026 shares, respectively, of its common stock through open market purchases pursuant to Rule 10b5-1 plans for $ 250 million, $ 250 million and $ 488 million, respectively.

At December 31, 2024, BHF had $ 543 million remaining under its common stock repurchase program.

4 unchanged sentences

The Company issues new shares to satisfy vested RSUs and PSUs, as well as stock option exercises.

All share-based compensation is measured at fair value as of the grant date.

Unless otherwise noted, all share-based compensation is measured at fair value as of the grant date.

The Company recognizes compensation expense related to share-based awards based on the number of awards expected to vest, which for some award types represent the awards granted less expected forfeitures over the life of the award, as estimated at the date of grant and actual forfeitures for other award types.

26 unchanged sentences

Vesting is subject to continued service, except for employees who meet specified age and service criteria, and in certain other limited circumstances.

For awards granted for performance periods in progress through December 31, 2023, the performance factors are based on the achievement of net cash flow to Brighthouse Holdings, LLC and statutory expense ratio targets over the respective performance period depending on year of issue.

For awards granted for performance periods in progress through December 31, 2023, the vested PSUs will be multiplied by a performance factor up to a maximum payout of 150 %.

Assuming the Company has met certain threshold performance targets, the Compensation and Human Capital Committee of BHF’s Board of Directors will determine the performance factor at its discretion.

For awards granted during fiscal years 2022 and 2023, the performance factors are based on the achievement of net cash flow to BHF, Brighthouse Services, LLC and Brighthouse Holdings, LLC (“BH Holdings”) and statutory expense ratio targets over the respective performance period depending on the year of issue.

The vested PSUs will be multiplied by a performance factor up to a maximum payout of 150 %.

Assuming the Company has met certain threshold performance targets, the Compensation and Human Capital Committee of BHF’s Board of Directors will determine the final performance factor at its discretion.

For awards granted during fiscal year 2024, the performance factors are based on the achievement of net cash flow to BHF, Brighthouse Services, LLC and BH Holdings over the performance period and statutory expense ratio targets over the performance period, subject to a potential 10 % modifier based on BHF’s relative total shareholder return (“rTSR”) over the same three-year period compared to a peer group of companies.

For these awards, the Company measures fair value using a Monte Carlo simulation that considers the Company’s projected rTSR relative to a defined group of peers as well as other inputs to estimate the grant date fair value of awards.

T he vested PSUs will be multiplied by a performance factor, as well as subject to an rTSR modifier, resulting in a maximum possible payout of 160 %.

The following table presents a summary of PSU and RSU activity:

10 unchanged sentences

The weighted average grant date fair value of PSUs granted during the years ended December 31, 2023 and 2022, was $ 58.35 and $ 48.06 , respectively.

The total fair value of RSUs that vested during each of the years ended December 31, 2023, 2022 and 2021 was $ 15 million.

The total fair value of RSUs that vested during each of the years ended December 31, 2024, 2023 and 2022 was $ 13 million, $ 15 million and $ 15 million, respectively.

The total fair value of PSUs that vested during the years ended December 31, 2024, 2023 and 2022, was $ 13 million, $ 9 million and $ 7 million, respectively.

13 unchanged sentences

During the years ended December 31, 2023 and 2022, no stock options were granted or exercised.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Equity (continued)

Employee Stock Purchase Plan Shares

3 unchanged sentences

The weighted average per share fair value of the discount under the ESPP was $ 8.54 , $ 9.04 and $ 8.54 during the years ended December 31, 2024, 2023 and 2022, respectively, which was recorded in other expenses.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Equity (continued)

Statutory Financial Information

2 unchanged sentences

RBC is based on statutory financial statements and is calculated in a manner prescribed by the NAIC.

The RBC ratio, which is the basis for determining regulatory compliance, is equal to total adjusted capital (“TAC”) divided by the applicable company action level RBC.

The RBC ratio, which is the basis for determining regulatory compliance, is equal to total adjusted capital divided by the applicable company action level RBC.

Companies below 100% of the company action level RBC are subject to corrective action.

2 unchanged sentences

Statutory accounting principles differ from GAAP primarily by charging policy acquisition costs to expense as incurred, establishing future policy benefit liabilities using different actuarial assumptions, reporting of reinsurance agreements and valuing investments and deferred tax assets on a different basis.

The tables below present amounts from certain of the Company’s insurance subsidiaries, which are derived from the statutory-basis financial statements as filed with the insurance regulators.

The tables below present amounts from certain of the Company’s insurance subsidiaries, which are derived from the statutory-basis financial statements to be filed with the insurance regulators.

Statutory net income (loss) was as follows:

18 unchanged sentences

2025 2024 2023 2022

Company Permitted

Approval (1) Paid (2) Paid (2) Paid (2)

Company Permitted Without Approval (1) Paid (2) Paid (2) Paid (2)

(In millions)

4 unchanged sentences

(1) Reflects dividend amounts that may be paid during 2025 without prior regulatory approval.

However, because dividend tests may be based on dividends previously paid over rolling 12-month periods, if paid before a specified date during 2024, some or all of such dividends may require regulatory approval to the extent dividends were paid in 2023.

(2) Reflects all amounts paid, including those requiring regulatory approval.

25 unchanged sentences

BRCD did no t pay any extraordinary dividends during the years ended December 31, 2024, 2023 and 2022.

During the year ended December 31, 2021, BRCD paid an extraordinary dividend in the form of the settlement of affiliated reinsurance balances of $ 400 million, invested assets of $ 197 million and cash of $ 3 million.

During each of the years ended December 31, 2024, 2023 and 2022, BRCD paid cash dividends of $ 1 million to its preferred shareholders.

9 unchanged sentences

Balance at December 31, 2021

Cumulative effect to change in accounting principle, net of income tax (3)

$ 5,285 $ 239 $ ( 3,230 ) $ ( 2,199 ) $ ( 48 ) $ 47

Balance at January 1, 2021

7,626 115 ( 2,729 ) ( 3,180 ) ( 45 ) 1,787

OCI before reclassifications ( 14,741 ) 331 2,344 4,075 ( 16 ) ( 8,007 )

7 unchanged sentences

Balance at December 31, 2022

( 6,194 ) 504 ( 1,378 ) 1,020 ( 58 ) ( 6,106 )

OCI before reclassifications 2,149 ( 276 ) ( 636 ) ( 380 ) 9 866

7 unchanged sentences

Balance at December 31, 2023

( 4,317 ) 277 ( 1,881 ) 720 ( 45 ) ( 5,246 )

OCI before reclassifications ( 1,226 ) 136 352 543 ( 22 ) ( 217 )

11 unchanged sentences

(2) Includes OCI related to foreign currency translation and defined benefit plan gains and losses.

(3) See Notes 1 and 2 for information on the adoption of ASU 2018-12.

(3) The effects of income taxes on amounts recorded to AOCI are also recognized in AOCI.

27 unchanged sentences

Total reclassifications, net of income tax $ ( 140 ) $ ( 176 ) $ ( 172 )

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Other Revenues and Other Expenses

1 unchanged sentence

The Company has entered into contracts with mutual funds, fund managers, and their affiliates (collectively, the “Funds”) whereby the Company is paid monthly or quarterly fees (“12b-1 fees”) for providing certain services to customers and distributors of the Funds.

The 12b-1 fees are generally equal to a fixed percentage of the average daily balance of the customer’s investment in a fund.

The 12b-1 fees, which are included in other revenues, are generally equal to a fixed percentage of the average daily balance of the customer’s investment in a fund.

The percentage is specified in the contract between the Company and the Funds.

2 unchanged sentences

The passage of time reflects the satisfaction of the Company’s performance obligations to the Funds and is used to recognize revenue associated with 12b-1 fees.

Other revenues consisted primarily of 12b-1 fees of $ 266 million, $ 292 million and $ 360 million for the years ended December 31, 2023, 2022 and 2021, respectively, of which substantially all were reported in the Annuities segment.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Other Revenues and Other Expenses (continued)

Other revenues included 12b-1 fees of $ 272 million, $ 266 million and $ 292 million for the years ended December 31, 2024, 2023 and 2022, respectively, of which substantially all were reported in the Annuities segment.

Other Expenses

11 unchanged sentences

Interest expense on debt 152 153 153

Debt repayment costs — — 75

Other 77 95 187

4 unchanged sentences

See Note 11 for attribution of interest expense by debt issuance.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Employee Benefit Plans

6 unchanged sentences

The qualified defined benefit pension plan had an accumulated benefit obligation of $ 122 million and $ 129 million at December 31, 2024 and 2023, respectively.

This plan was fully funded at December 31, 2023 and 2022 with assets in excess of the accumulated benefit obligation of $ 5 million and $ 3 million, respectively.

This plan was fully funded with assets in excess of the accumulated benefit obligation of $ 5 million at both December 31, 2024 and 2023.

The Company did no t make any employer contributions to this qualified plan during 2024 or 2023.

3 unchanged sentences

The amounts due under these other unfunded benefit plans were $ 58 million and $ 57 million at December 31, 2024 and 2023, respectively.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Employee Benefit Plans (continued)

Although NELICO remains the legal obligor for these plans, an employee matters agreement (“EMA”) exists between BHF and MetLife, whereby MetLife has agreed to reimburse BHF for the obligations under the non-qualified and other unfunded plans as payments are made.

13 unchanged sentences

Provision for income tax expense (benefit) $ 29 $ ( 367 ) $ 848

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Income Tax (continued)

The reconciliation of the income tax provision at the statutory tax rate to the provision for income tax as reported was as follows:

5 unchanged sentences

Resolution of prior years

— ( 76 ) ( 4 )

Dividends received deduction ( 34 ) ( 34 ) ( 36 )

1 unchanged sentence

Change in uncertain tax benefits

( 18 ) — ( 15 )

Return to provision

1 unchanged sentence

Adjustments to deferred tax

— ( 2 ) ( 56 )

Change in valuation allowance — ( 18 ) —

3 unchanged sentences

Effective tax rate 7 % 25 % 18 %

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Income Tax (continued)

Deferred income tax represents the tax effect of the differences between the book and tax bases of assets and liabilities.

16 unchanged sentences

Net deferred income tax asset (liability) $ 1,875 $ 1,893

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Income Tax (continued)

The following table sets forth the net operating loss carryforwards for tax purposes at December 31, 2024.

12 unchanged sentences

Indefinite — —

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Income Tax (continued)

The Company’s liability for unrecognized tax benefits may increase or decrease in the next 12 months.

12 unchanged sentences

Lapses of statutes of limitations

( 12 ) — ( 22 )

Balance at December 31, $ 1 $ 19 $ 19

7 unchanged sentences

Management believes it has established adequate tax liabilities, and final resolution of any audits for the years 2017 and forward is not expected to have a material impact on the Company’s consolidated financial statements.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Income Tax (continued)

Tax Sharing Agreements

For the periods prior to the Separation, BHF and certain of its subsidiaries filed a consolidated federal income tax return with MetLife and its insurance and non-insurance subsidiaries.

Current taxes (and the benefits of tax attributes such as losses) are allocated to BHF, and its includable subsidiaries, under a tax sharing agreement with MetLife.

For the periods prior to the Separation, BHF and certain of its subsidiaries filed a consolidated federal income tax return with MetLife, Inc.

and its insurance and non-insurance subsidiaries.

Current taxes (and the benefits of tax attributes such as losses) are allocated to BHF, and its includable subsidiaries, under a tax sharing agreement with MetLife, Inc.

This tax sharing agreement states that federal taxes are computed on a modified separate return basis with benefits for losses.

For periods after the Separation through the year ended December 31, 2022, BHF entered into two separate tax sharing agreements.

For periods after the Separation through the year ended December 31, 2022, Brighthouse Financial entered into two separate tax sharing agreements.

Brighthouse Life Insurance Company, BHNY and BRCD entered into a tax sharing agreement to join a consolidated federal income tax return.

2 unchanged sentences

NELICO and the non-insurance subsidiaries of Brighthouse Life Insurance Company filed their own federal income tax returns.

BHF and certain of its subsidiaries, including its insurance and reinsurance subsidiaries, intend to file a consolidated federal income tax return for the year ended December 31, 2023 and future years.

In furtherance thereof, such parties intend to join a single tax sharing agreement, pursuant to which federal taxes are computed on a modified separate return basis with benefits for losses.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Income Tax (continued)

For periods beginning with the year ended December 31, 2023, BHF and certain of its subsidiaries, including its insurance and reinsurance subsidiaries, file a consolidated federal income tax return.

In furtherance thereof, such parties joined a single tax sharing agreement, pursuant to which federal taxes are computed on a modified separate return basis with benefits for losses.

Income Tax Transactions with Former Parent

and its subsidiaries’ net operating losses, capital losses, tax basis and amortization or depreciation deductions in respect of certain tax benefits it may realize as a result of certain transactions involved in the Separation.

In connection with the Separation, the Company entered into a tax receivables agreement (the “Tax Receivables Agreement”) with MetLife that provides MetLife with the right to receive, as partial consideration for its contribution of assets to BHF, future payments from BHF equal to 86 % of the amount of cash savings, if any, in federal income tax that Brighthouse Financial actually, or is deemed to, realize as a result of the utilization of BHF and its subsidiaries’ net operating losses, capital losses, tax basis and amortization or depreciation deductions in respect of certain tax benefits it may realize as a result of certain transactions involved in the Separation.

In connection with the Tax Receivables Agreement, the Company has a payable to MetLife of $ 328 million at both December 31, 2024 and 2023, reported in other liabilities.

The Company also entered into a tax separation agreement with MetLife.

The Company also entered into a tax separation agreement with MetLife (the “Tax Separation Agreement”).

Among other things, the Tax Separation Agreement governs the allocation between MetLife and the Company of the responsibility for the taxes of the MetLife group.

The Tax Separation Agreement also allocates rights, obligations and responsibilities in connection with certain administrative matters relating to the preparation of tax returns and control of tax audits and other proceedings relating to taxes.

For the years ended December 31, 2023 and 2022, MetLife paid Brighthouse Financial $ 0 and $ 7 million, respectively, and for the year ended December 31, 2021, Brighthouse Financial paid MetLife $ 81 million, under the tax separation agreement.

For the years ended December 31, 2024, 2023 and 2022, MetLife paid Brighthouse Financial $ 0 , $ 0 and $ 7 million, respectively, under the Tax Separation Agreement.

At December 31, 2024 and 2023, there was a current income tax receivable of $ 16 million and $ 21 million, respectively, related to this agreement.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Earnings Per Common Share

10 unchanged sentences

Diluted $ 4.64 $ ( 18.39 ) $ 51.30

For the years ended December 31, 2024 and 2022, weighted average shares used for calculating diluted earnings per common share excludes 187,371 shares underlying out-of-the-money stock options, as the inclusion of such shares would be antidilutive under the treasury stock method to the earnings per common share calculation due to the average share price for the years ended December 31, 2024 and 2022.

See Note 12 for further information on share-based compensation plans.

For the year ended December 31, 2023, basic loss per common share equaled diluted loss per common share.

The diluted shares were not included in the per share calculation for this period as the inclusion of such shares would have an antidilutive effect.

For the years ended December 31, 2022 and 2021, weighted average shares used for calculating diluted earnings per common share excludes 187,371 of out-of-the-money stock options, as the inclusion of such shares would be antidilutive to the earnings per common share calculation due to the average share price for the years ended December 31, 2022 and 2021.

See Note 13 for further information on share-based compensation plans.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees

13 unchanged sentences

Disposition valuations are also subject to the uncertainty of how opposing parties and their counsel will themselves view the relevant evidence and applicable law.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees (continued)

The Company establishes liabilities for litigation and regulatory loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.

12 unchanged sentences

The Company believes adequate provision has been made in its consolidated financial statements for all probable and reasonably estimable losses for sales practices matters.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees (continued)

Cost of Insurance Class Actions

9 unchanged sentences

Plaintiff was granted leave to amend the complaint.

On January 18, 2023, the plaintiff filed a motion on consent to amend the second amended class action complaint to narrow the scope of the class sought to those persons who own or owned life insurance policies issued in Georgia.

On January 18, 2023, plaintiff filed a motion on consent to amend the second amended class action complaint to narrow the scope of the class sought to those who own or owned policies issued in Georgia.

The motion was granted on January 23, 2023, and the third amended class action complaint was filed on January 23, 2023.

The Company intends to vigorously defend this matter.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees (continued)

Lawrence Martin v.

14 unchanged sentences

The action relates to a data security incident at an alleged third-party vendor, PBI Research Services (“PBI”), and allegedly involves the MOVEit file transfer system that PBI uses in its provision of services (“MOVEit Incident”).

As it relates to BHF, plaintiff seeks to certify a subclass of persons whose private information was allegedly maintained by BHF and accessed or acquired in connection with the MOVEit Incident.

As it relates to BHF, plaintiff seeks to certify a subclass of persons whose private information was allegedly maintained by BHF and accessed or acquired in relation to the MOVEit Incident.

Plaintiff alleges, among other things, that BHF negligently chose to utilize PBI to store and transfer plaintiff’s and purported class members’ private information despite PBI’s use of the MOVEit software which plaintiff contends contained security vulnerabilities.

The complaint asserts claims against BHF for negligence, negligence per se, and unjust enrichment, and plaintiff seeks declaratory and injunctive relief, damages, attorneys’ fees and prejudgment interest.

The court dismissed claims for injunctive relief against BHF but denied the remainder of a motion to dismiss based on plaintiff’s lack of standing.

BHF intends to vigorously defend this matter.

1 unchanged sentence

Further, state insurance regulatory authorities and other federal and state authorities regularly make inquiries and conduct investigations concerning the Company’s compliance with applicable insurance and other laws and regulations.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees (continued)

It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings.

7 unchanged sentences

In the absence of sufficient information to support an assessment of the reasonably possible loss or range of loss, no accrual is made and no loss or range of loss is disclosed.

On a quarterly basis, the Company reviews relevant information with respect to other loss contingencies and, when applicable, updates its accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews.

In the matters where the Company’s subsidiaries are acting as the reinsured or the reinsurer, such matters have involved assertions by third parties primarily related to rates, fees or reinsured benefit calculations, and, in certain of such matters, the counterparty has made a request to arbitrate.

For tax-related matters, this has involved disputes with taxing authorities, ongoing audits, evaluation of filing positions and any potential assessments related thereto.

As of December 31, 2023, the Company estimates the range of reasonably possible losses in excess of the amounts accrued for certain other loss contingencies to be from zero up to approximately $ 200 million for the aforementioned matters.

For certain other matters, the Company may not currently be able to estimate the reasonably possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of such loss.

During the second quarter of 2022, the Company settled a reinsurance-related matter with a third party for $ 140 million, which is reported in other expenses.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees (continued)

The Company’s tax-related matters have involved disputes with taxing authorities, ongoing audits, evaluation of filing positions and any potential assessments related thereto.

In the matters where the Company’s subsidiaries are acting as the reinsured or the reinsurer, such reinsurance matters have involved assertions by third parties primarily related to rates, fees or reinsured benefit calculations, and certain of such reinsurance matters have resulted in arbitration.

As of December 31, 2024, the Company estimates the range of reasonably possible losses in excess of the amounts accrued for certain other loss contingencies to be from zero up to approximately $ 100 million relating to certain tax matters, as described above.

For certain other matters, the Company may not currently be able to estimate the reasonably possible loss or estimated range of loss until developments in such matters have provided sufficient information to support an assessment of such loss.

During the first quarter of 2024, an arbitration panel ruled in favor of a reinsurer seeking a premium rate increase retroactive to September 2019 resulting in a $ 187 million loss, of which $ 167 million was reported in universal life and investment product-type policy fees and $ 20 million was reported in other expenses.

Mortgage Loan Commitments

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The amounts of these unfunded commitments were $ 1.7 billion and $ 1.4 billion at December 31, 2024 and 2023, respectively.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Contingencies, Commitments and Guarantees (continued)

In the normal course of its business, the Company has provided certain indemnities, guarantees and commitments to third parties such that it may be required to make payments now or in the future.

In the context of acquisition, disposition, investment and other transactions, the Company has provided indemnities and guarantees, including those related to tax, environmental and other specific liabilities and other indemnities and guarantees that are triggered by, among other things, breaches of representations, warranties or covenants provided by the Company.

In the context of reinsurance, acquisition, disposition, investment and other transactions, the Company has provided indemnities and guarantees, including those related to tax, environmental and other specific liabilities and other indemnities and guarantees that are triggered by, among other things, breaches of representations, warranties or covenants provided by the Company.

In addition, in the normal course of business, the Company provides indemnifications to counterparties in contracts with triggers similar to the foregoing, as well as for certain other liabilities, such as third-party lawsuits.

These obligations are often subject to time limitations that vary in duration, including contractual limitations and those that arise by operation of law, such as applicable statutes of limitation.

In some cases, the maximum potential obligation under the indemnities and guarantees is subject to a contractual limitation ranging from less than $ 1 million to $ 92 million, with a cumulative maximum of $ 98 million, while in other cases such limitations are not specified or applicable.

In some cases, the maximum potential obligation under the indemnities and guarantees is subject to a contractual limitation with a cumulative maximum of $ 83 million, while in other cases such limitations are not specified or applicable.

Since certain of these obligations are not subject to limitations, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these guarantees in the future.

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Since these indemnities are generally not subject to limitation with respect to duration or amount, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these indemnities in the future.

The Company’s recorded liabilities were $ 1 million at both December 31, 2023 and 2022 for indemnities, guarantees and commitments.

The Company did no t have any liabilities recorded for indemnities, guarantees and commitments at December 31, 2024 and had recorded liabilities for indemnities, guarantees and commitments of $ 1 million at December 31, 2023.

Brighthouse Financial, Inc.

Notes to the Consolidated Financial Statements (continued)

Quarterly Results of Operations (Unaudited)

As described in Note 1, the Company adopted LDTI effective January 1, 2023.

LDTI resulted in significant changes to the measurement, presentation and disclosure requirements for long-duration insurance contracts.

The transition date was January 1, 2021.

The unaudited quarterly results of operations for 2023 and 2022, which include the impacts of LDTI, are summarized in the table below:

Three Months Ended

March 31, June 30, September 30, December 31,

(In millions, except per share data)

Total revenues $ 1,284 $ 263 $ 1,170 $ 1,400

Total expenses $ 1,937 $ 500 $ 580 $ 2,574

Net income (loss) $ ( 497 ) $ ( 175 ) $ 481 $ ( 916 )

Net income (loss) attributable to noncontrolling interests $ 2 $ — $ 2 $ 1

Net income (loss) attributable to Brighthouse Financial, Inc.

$ ( 499 ) $ ( 175 ) $ 479 $ ( 917 )

Preferred stock dividends $ 26 $ 25 $ 26 $ 25

Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ ( 525 ) $ ( 200 ) $ 453 $ ( 942 )

Basic earnings per common share (1) $ ( 7.72 ) $ ( 3.01 ) $ 6.92 $ ( 14.70 )

Diluted earnings per common share (1) $ ( 7.72 ) $ ( 3.01 ) $ 6.89 $ ( 14.70 )

Total revenues $ 2,013 $ 3,866 $ 1,121 $ ( 127 )

Total expenses $ 10 $ 1,689 $ 609 $ ( 167 )

Net income (loss) $ 1,587 $ 1,745 $ 415 $ 137

Net income (loss) attributable to noncontrolling interests $ 2 $ — $ 2 $ 1

Net income (loss) attributable to Brighthouse Financial, Inc.

$ 1,585 $ 1,745 $ 413 $ 136

Preferred stock dividends $ 27 $ 26 $ 25 $ 26

Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders $ 1,558 $ 1,719 $ 388 $ 110

Basic earnings per common share (1) $ 20.27 $ 23.04 $ 5.42 $ 1.61

Diluted earnings per common share (1) $ 20.11 $ 22.91 $ 5.39 $ 1.59

_______________

(1) See Note 17 for additional information on the calculation of EPS.

Subsequent Event

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On February 18, 2025, BHF declared a dividend of $ 412.50 per share on its Series A Preferred Stock, $ 421.88 per share on its Series B Preferred Stock, $ 335.94 per share on its Series C Preferred Stock and $ 289.06 per share on its Series D Preferred Stock for a total of $ 26 million, which will be paid on March 25, 2025 to stockholders of record as of March 10, 2025.

Capital Transaction

On February 11, 2025, Brighthouse Life Insurance Company received a $ 100 million capital contribution from BH Holdings.

Brighthouse Financial, Inc.

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Short-term investments, principally at estimated fair value 622 580

Other invested assets, principally at estimated fair value 5 —

Investment in subsidiary 7,799 7,710

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Current income tax recoverable 42 78

Deferred income tax asset — 33

Other assets 4 5

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Total revenues 83 48 2

Debt repayment costs — — 77

Other expenses 207 192 168

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Cash flows from financing activities

Net change in payables for collateral under securities loaned and other transactions

Long-term and short-term debt issued 570 753 961

Long-term and short-term debt repaid ( 339 ) ( 439 ) ( 811 )

Debt repayment costs — — ( 71 )

Preferred stock issued, net of issuance costs — — 339

Dividends on preferred stock ( 102 ) ( 102 ) ( 104 )

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Brighthouse Financial, Inc.

Condensed Financial Information (continued)

Notes to the Condensed Financial Information

(Parent Company Only)

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Investments in subsidiaries are accounted for using the equity method of accounting.

Certain amounts in the prior years’ condensed financial statements of the Parent Company have changed.

See Note 1 of the Notes to the Consolidated Financial Statements for information regarding the adoption of new guidance on long-duration contracts as of January 1, 2023.

The preparation of these condensed unconsolidated financial statements in conformity with GAAP requires management to adopt accounting policies and make certain estimates and assumptions.

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Investment in Subsidiary

During the year ended December 31, 2023, BHF received cash distributions of $ 350 million and non-cash distributions of $ 100 million from Brighthouse Holdings, LLC (“BH Holdings”) and did not make any capital contributions to BH Holdings.

During the year ended December 31, 2024, BHF received non-cash distributions of $ 376 million from Brighthouse Holdings, LLC (“BH Holdings”) and did not make any capital contributions to BH Holdings.

The non-cash distributions received related to reductions of short-term intercompany loans of $ 400 million from Brighthouse Services, LLC to BH Holdings (which was then contributed to BHF).

During the year ended December 31, 2023, BHF received cash distributions of $ 350 million and non-cash distributions of $ 100 million from BH Holdings and did not make any capital contributions to BH Holdings.

Cash distributions received during the year ended December 31, 2023 primarily related to $ 266 million of ordinary cash dividends paid by Brighthouse Life Insurance Company to BH Holdings.

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The non-cash distributions received related to reductions of short-term intercompany loans of $ 250 million from Brighthouse Services, LLC to BH Holdings (which was then contributed to BHF) and an additional $ 100 million from BH Holdings to BHF.

During the year ended December 31, 2021, BHF received cash distributions of $ 310 million from BH Holdings and did not make any capital contributions to BH Holdings.

Distributions received during the year ended December 31, 2021 primarily related to $ 550 million of ordinary cash dividends paid by Brighthouse Life Insurance Company to BH Holdings.

Long-term and Short-term Debt

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Brighthouse Financial, Inc.

Condensed Financial Information (continued)

Notes to the Condensed Financial Information (continued)

(Parent Company Only)

The aggregate maturities of long-term and short-term debt at December 31, 2023 were $ 727 million in 2024, $ 0 in each of 2025 and 2026, $ 757 million in 2027, $ 0 in 2028, and $ 2.4 billion thereafter.

The aggregate maturities of long-term and short-term debt at December 31, 2024 were $ 582 million in 2025, $ 0 in 2026, $ 757 million in 2027, $ 0 in each of 2028 and 2029, and $ 2.4 billion thereafter.

Interest expense related to long-term and short-term debt of $ 192 million, $ 178 million and $ 155 million for the years ended December 31, 2024, 2023 and 2022, respectively, is included in other expenses.

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Each loan entered into under this intercompany loan agreement has a term not more than 364 days and bears interest on the unpaid principal amount at a variable rate, payable monthly.

During the years ended December 31, 2023, 2022 and 2021, BHF borrowed $ 753 million, $ 1.0 billion and $ 1.1 billion, respectively, from certain of its non-insurance subsidiaries and repaid $ 439 million, $ 811 million and $ 805 million of such borrowings during the years ended December 31, 2023, 2022 and 2021, respectively.

During the years ended December 31, 2024, 2023 and 2022, BHF borrowed $ 570 million, $ 753 million and $ 1.0 billion, respectively, from certain of its non-insurance subsidiaries and repaid $ 339 million, $ 439 million and $ 811 million of such borrowings during the years ended December 31, 2024, 2023 and 2022, respectively.

The weighted average interest rate on short-term intercompany loans outstanding at December 31, 2024, 2023 and 2022 was 3.73 %, 4.73 % and 3.73 %, respectively.

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Life insurance in-force (1)

$ 470,679 $ 125,696 $ 5,641 $ 350,624 1.6 %

Insurance premium

Life insurance (2)

$ 1,206 $ 450 $ 12 $ 768 1.6 %

Accident & health insurance 189 187 — 2 — %

1 unchanged sentence

Life insurance in-force (1)

$ 489,313 $ 134,682 $ 6,127 $ 360,758 1.7 %

Insurance premium

Life insurance (2)

$ 1,294 $ 489 $ 14 $ 819 1.7 %

Accident & health insurance 205 196 — 9 — %

1 unchanged sentence

Life insurance in-force (1)

$ 502,679 $ 144,647 $ 6,578 $ 364,610 1.8 %

Insurance premium

Life insurance (2)

$ 1,157 $ 505 $ 6 $ 658 0.9 %

Accident & health insurance 202 198 — 4 — %

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_______________

(1) Includes life insurance products in the Life, Run-off and Corporate & Other segments.

(2) Includes annuities with life contingencies.

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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.

What changed 10-K

Item 8. Financial Statements and Supplementary Data