Corebridge Financial, Inc. 10-Q

crbg-20240331 TABLE OF CONTENTS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-41504 Corebridge Financial, Inc. (Exact name of registrant as specified in its charter) Delaware 95-4715639 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 2919 Allen Parkway, Woodson Tower , Houston , Texas 77019 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: 1-877 - 375-2422 ____________________ Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934: Title of each class Trading Symbol Name of each exchange on which registered Common Stock, Par Value $0.01 Per Share CRBG New York Stock Exchange Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files) . Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ As of April 26, 2024, there were 611,640,610 shares outstanding of the registrant’s common stock. TABLE OF CONTENTS COREBRIDGE FINANCIAL, INC. QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2024 TABLE OF CONTENTS FORM 10-Q Item Number Description Page Part I - Financial Information ITEM 1 Financial Statements (Unaudited) Condensed Consolidated Balance Sheets at March 31, 2024 and December 31, 2023 4 Condensed Consolidated Statements of Income (Loss) for the three months ended March 31, 2024 and 2023 5 Condensed Consolidated Statements of Comprehensive Income (Loss) for the three months ended March 31, 2024 and 2023 6 Condensed Consolidated Statements of Equity for the three months ended March 31, 2024 and 2023 7 Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023 8 Notes to Condensed Consolidated Financial Statements (Unaudited) NOTE 1. Overview and Basis of Presentation 10 NOTE 2 . Summary of Significant Accounting Policies 10 NOTE 3. Segment Information 11 NOTE 4. Held-For-Sale Classification 14 NOTE 5 . Fair Value Measurements 15 NOTE 6 . Investments 30 NOTE 7 . Lending Activities 36 NOTE 8 . Reinsurance 40 NOTE 9. Variable Interest Entities 42 NOTE 10 . Derivatives and Hedge Accounting 44 NOTE 1 1 . Deferred Policy Acquisition Costs 49 NOTE 12. Separate Account Assets and Liabilities 50 NOTE 13. Future Policy Benefits 51 NOTE 14. Policyholder Contract Deposits and Other Policyholder Funds 56 NOTE 15. Market Risk Benefits 60 NOTE 1 6 . Contingencies, Commitments and Guarantees 62 NOTE 17. Equity 64 NOTE 1 8 . Earnings Per Common Share 67 NOTE 19. Income Taxes 68 NOTE 20. Related Parties 70 ITEM 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations 73 ITEM 3 Quantitative and Qualitative Disclosures About Market Risk 135 ITEM 4 Controls and Procedures 135 Part II – Other Information ITEM 1 Legal Proceedings 136 ITEM 1A Risk Factors 136 ITEM 2 Unregistered Sales of Equity Securities and Use of Proceeds 136 ITEM 5 Other Information 136 ITEM 6 Exhibits 137 Signatures 138 Corebridge | First Quarter 2024 Form 10-Q 1 TABLE OF CONTENTS Cautionary Statement Regarding Forward-Looking Information This Quarterly Report on Form 10-Q (“Quarterly Report”) may include statements, which, to the extent they are not statements of historical or present fact, constitute “forward looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of terms such as “believes,” “expects,” “may,” “will,” “shall,” “should,” “would,” “could,” “seeks,” “aims,” “projects,” “is optimistic,” “intends,” “targets,” “plans,” “estimates,” “anticipates” or other comparable terms. Forward-looking statements include, without limitation, all matters that are not historical facts. They appear in a number of places throughout this Quarterly Report and include, without limitation, statements regarding our intentions, beliefs, assumptions or current plans and expectations concerning, among other things, financial position and future financial condition; results of operations; expected operating and non-operating relationships; ability to meet debt service obligations and financing plans; product sales; distribution channels; retention of business; investment yields and spreads; investment portfolio and ability to manage asset-liability cash flows; financial goals and targets; prospects; growth strategies or expectations; laws and regulations; customer retention; the outcome (by judgment or settlement) and costs of legal, administrative or regulatory proceedings, investigations or inspections, including, without limitation, collective, representative or class action litigation; the impact of our separation from AIG; geopolitical events, including the ongoing armed conflicts between Ukraine and Russia and in the Middle East; and the impact of prevailing capital markets and economic conditions. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition, liquidity and cash flows, and the development of the markets in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this Quarterly Report . In addition, even if our results of operations, financial condition, liquidity and cash flows, and the development of the markets in which we operate, are consistent with the forward-looking statements contained in this Quarterly Report , those results or developments may not be indicative of results or developments in subsequent periods. A number of important factors, including, without limitation, the risks and uncertainties discussed in “Risk Factors” and “ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”) could cause actual results and outcomes to differ materially from those reflected in the forward-looking statements. Factors that could cause actual results and outcomes to differ from those reflected in forward-looking statements include, without limitation: • changes in interest rates and changes to credit spreads; • the deterioration of economic conditions, an economic slowdown or recession, changes in market conditions, weakening in capital markets, volatility in equity markets, inflationary pressures, pressures on the commercial real estate market, uncertainty regarding a potential U.S. federal government shutdown, and geopolitical tensions, including the ongoing armed conflicts between Ukraine and Russia and in the Middle East; • the unpredictability of the amount and timing of insurance liability claims; • unavailable, uneconomical or inadequate reinsurance or recaptures of reinsured liabilities; • uncertainty and unpredictability related to our reinsurance agreements with Fortitude Reinsurance Company Ltd. (“ Fortitude Re”) and its performance of its obligations under these agreements; • our limited ability to access funds from our subsidiaries; • our ability to incur indebtedness, our potential inability to refinance all or a portion of our indebtedness or our ability to obtain additional financing on favorable terms or at all; • our inability to generate cash to meet our needs due to the illiquidity of some of our investments; • the inaccuracy of the methodologies, estimations and assumptions underlying our valuation of investments and derivatives; • a downgrade in our Insurer Financial Strength (“IFS”) ratings or credit ratings; • exposure to credit risk due to non-performance or defaults by our counterparties or our use of derivative instruments to hedge market risks associated with our liabilities; • our ability to adequately assess risks and estimate losses related to the pricing of our products; • the failure of third parties that we rely upon to provide and adequately perform certain business, operations, investment advisory, functional support and administrative services on our behalf; • the impact of risks associated with our arrangement with Blackstone ISG-I Advisors LLC (“Blackstone IM”), BlackRock Financial Management, Inc. (“BlackRock”) or any other asset manager we retain, including their historical performance not being indicative of the future results of our investment portfolio and the exclusivity of certain arrangements with Blackstone IM; • our inability to maintain the availability of critical technology systems and the confidentiality of our data, including challenges associated with a variety of privacy and information security laws; • the ineffectiveness of our risk management policies and procedures; Corebridge | First Quarter 2024 Form 10-Q 2 TABLE OF CONTENTS • significant legal, governmental or regulatory proceedings; • the intense competition we face in each of our business lines and the technological changes, including the use of artificial intelligence (“AI”), that may present new and intensified challenges to our business; • catastrophes, including those associated with climate change and pandemics; • business or asset acquisitions and dispositions that may expose us to certain risks; • our ability to protect our intellectual property; • our ability to compete effectively in a heavily regulated industry in light of new domestic or international laws and regulations or new interpretations of current laws and regulations; • impact on sales of our products and taxation of our operations due to changes in U.S. federal income or other tax laws or the interpretation of tax laws; • the ineffectiveness of our productivity improvement initiatives in yielding our expected expense reductions and improvements in operational and organizational efficiency; • recognition of an impairment of our goodwill or the establishment of an additional valuation allowance against our deferred income tax assets as a result of our business lines underperforming or their estimated fair values declining; • differences between actual experience and the estimates used in the preparation of financial statements and modeled results used in various areas of our business; • our inability to attract and retain key employees and highly skilled people needed to support our business; • our failure to replicate or replace functions, systems and infrastructure provided by AIG (including through shared service contracts) or our loss of benefits from AIG’s global contracts, and AIG’s failure to perform the services provided for in the transition services agreement entered into between us and AIG on September 14, 2022 (the “Transition Services Agreement”); • the significant influence that AIG has over us and conflicts of interests arising due to such relationship; • the indemnification obligations we have to AIG; • potentially higher U.S. federal income taxes due to our inability to file a single U.S. consolidated federal income tax return for five years following our initial public offering (“IPO”) and our separation from AIG causing an “ownership change” for U.S. federal income tax purposes; • risks associated with the Tax Matters Agreement with AIG and our potential liability for U.S. income taxes of the entire AIG Consolidated Tax Group for all taxable years or portions thereof in which we (or our subsidiaries) were members of such group; • the risk that anti-takeover provisions could discourage, delay, or prevent our change in control, even if the change in control would be beneficial to our shareholders; and • challenges related to compliance with applicable laws incident to being a public company, which is expensive and time-consuming. Other risks, uncertainties and factors, including those discussed in “ Risk Factors” in the 2023 Form 10-K could cause our actual results to differ materially from those projected in any forward-looking statements we make. You should read carefully the factors described in “ Risk Factors” in the 2023 Form 10-K to better understand the risks and uncertainties inherent in our business and underlying any forward-looking statements. You should read this Quarterly Report completely and with the understanding that actual future results may be materially different from expectations. All forward-looking statements made in this Quarterly Report are qualified by these cautionary statements. These forward-looking statements are made only as of the date of this Quarterly Report , and we do not undertake any obligation to update or revise any forward-looking statements to reflect the occurrence of events, unanticipated or otherwise, other than as may be required by law. Corporate Information We encourage investors and others to frequently visit our website (www.corebridgefinancial.com), including our Investor Relations web pages (investors.corebridgefinancial.com). We announce significant financial and other information to our investors and the public on the Investor Relations web pages, as well as in U.S. Securities and Exchange Commission (“SEC”) filings, in news releases, public conference calls and webcasts, fact sheets and other documents and media. The information found on our website is not incorporated by reference into this Quarterly Report or in any other report or document we submit to the SEC, and any references to our website are intended to be inactive textual references only. Corebridge | First Quarter 2024 Form 10-Q 3 TABLE OF CONTENTS Part I – Financial Information Item 1. | Financial Statements Corebridge Financial, Inc. Condensed Consolidated Balance Sheets ( unaudited) (in millions, except for share data) March 31, 2024 December 31, 2023 Assets: Investments: Fixed maturity securities: Bonds available-for-sale, at fair value, net of allowance for credit losses of $ 97 in 2024 and $ 128 in 2023 (amortized cost: 2024 - $ 188,403 ; 2023 - $ 184,946 )* $ 168,826 $ 166,527 Other bond securities, at fair value (See Note 6)* 4,646 4,578 Equity securities, at fair value (See Note 6)* 76 63 Mortgage and other loans receivable, net of allowance for credit losses of $ 714 in 2024 and $ 698 in 2023* 47,830 46,867 Other invested assets (portion measured at fair value: 2024 - $ 7,471 ; 2023 - $ 7,690 )* 10,036 10,257 Short-term investments, including restricted cash of $ 3 in 2024 and $ 3 in 2023 (portion measured at fair value: 2024 - $ 1,257 ; 2023 - $ 1,408 )* 4,144 4,336 Total investments 235,558 232,628 Cash* 410 612 Accrued investment income* 2,132 2,008 Premiums and other receivables, net of allowance for credit losses and disputes of $ 1 in 2024 and $ 1 in 2023 586 594 Reinsurance assets - Fortitude Re, net of allowance for credit losses and disputes of $ 0 in 2024 and $ 0 in 2023 26,078 26,772 Reinsurance assets - other, net of allowance for credit losses and disputes of $ 18 in 2024 and $ 30 in 2023 1,592 1,620 Deferred income taxes 8,347 8,577 Deferred policy acquisition costs and value of business acquired 10,049 10,011 Market risk benefit assets, at fair value 1,172 912 Other assets, including restricted cash of $ 13 in 2024 and $ 13 in 2023 (portion measured at fair value: 2024 - $ 491 ; 2023 - $ 393 )* 2,142 2,294 Separate account assets, at fair value 95,173 91,005 Assets held-for-sale 2,349 2,237 Total assets $ 385,588 $ 379,270 Liabilities: Future policy benefits for life and accident and health insurance contracts $ 57,587 $ 57,108 Policyholder contract deposits (portion measured at fair value: 2024 - $ 8,681 ; 2023 - $ 8,050 ) 163,783 162,050 Market risk benefit liabilities, at fair value 5,167 5,705 Other policyholder funds 2,864 2,862 Fortitude Re funds withheld payable (portion measured at fair value: 2024 - $ 2,211 ; 2023 - $ 2,182 ) 25,323 25,957 Other liabilities (portion measured at fair value: 2024 - $ 158 ; 2023 - $ 141 )* 9,634 8,330 Short-term debt 250 250 Long-term debt 9,118 9,118 Debt of consolidated investment entities (portion measured at fair value: 2024 - $ 0 ; 2023 - $ 0 )* 2,530 2,504 Separate account liabilities 95,173 91,005 Liabilities held-for-sale 1,773 1,746 Total liabilities $ 373,202 $ 366,635 Contingencies, commitments and guarantees ( See Note 16 ) Corebridge Shareholders' equity: Common stock, $ 0.01 par value; 2,500,000,000 shares authorized; shares issued: 2024 - 650,189,849 and 2023 648,148,737 $ 7 $ 6 Treasury stock, at cost; 2024 - 34,779,166 shares and 2023 - 26,484,411 shares ( 717 ) ( 503 ) Additional paid-in capital 8,115 8,149 Retained earnings 18,310 17,572 Accumulated other comprehensive loss ( 14,139 ) ( 13,458 ) Total Corebridge Shareholders' equity 11,576 11,766 Non-redeemable noncontrolling interests 810 869 Total equity 12,386 12,635 Total liabilities and equity $ 385,588 $ 379,270 * See Note 9 for details of balances associated with variable interest entities . See accompanying Notes to Condensed Consolidated Financial Statements (unaudited) Corebridge | First Quarter 2024 Form 10-Q 4 TABLE OF CONTENTS Corebridge Financial, Inc. Condensed Consolidated Statements of Income (Loss) ( unaudited) Three Months Ended March 31, (in millions, except per common share data) 2024 2023 Revenues: Premiums $ 2,295 $ 2,105 Policy fees 714 698 Net investment income: Net investment income - excluding Fortitude Re funds withheld assets 2,592 2,301 Net investment income - Fortitude Re funds withheld assets 332 394 Total net investment income 2,924 2,695 Net realized losses: Net realized losses - excluding Fortitude Re funds withheld assets and embedded derivative ( 178 ) ( 453 ) Net realized gains (losses) on Fortitude Re funds withheld assets ( 164 ) 20 Net realized gains (losses) on Fortitude Re funds withheld embedded derivative 22 ( 1,025 ) Total net realized losses ( 320 ) ( 1,458 ) Advisory fee income 124 116 Other income 99 106 Total revenues 5,836 4,262 Benefits and expenses: Policyholder benefits (includes remeasurement losses of $ 100 a nd $ 64 for the three months ended March 31, 2024 and 2023, respectively) 2,807 2,495 Change in the fair value of market risk benefits, net ( 369 ) 196 Interest credited to policyholder account balances 1,199 1,026 Amortization of deferred policy acquisition costs and value of business acquired 267 256 Non-deferrable insurance commissions 143 136 Advisory fee expenses 68 65 General operating expenses 572 582 Interest expense 138 172 Net (gain) loss on divestitures ( 5 ) 3 Total benefits and expenses 4,820 4,931 Income (loss) before income tax expense (benefit) 1,016 ( 669 ) Income tax expense (benefit) 189 ( 216 ) Net income (loss) 827 ( 453 ) Less: Net income (loss) attributable to noncontrolling interests ( 51 ) 6 Net income (loss) attributable to Corebridge $ 878 $ ( 459 ) Income (loss) per common share attributable to Corebridge common shareholders: Common stock - basic $ 1.41 $ ( 0.70 ) Common stock - diluted $ 1.41 $ ( 0.70 ) Weighted averages shares outstanding: Common stock - basic 624.0 650.8 Common stock - diluted 624.9 650.8 See accompanying Notes to Condensed Consolidated Financial Statements (unaudited) Corebridge | First Quarter 2024 Form 10-Q 5 TABLE OF CONTENTS Corebridge Financial, Inc. Condensed Consolidated Statements of Comprehensive Income (Loss) ( unaudited) Three Months Ended March 31, (in millions) 2024 2023 Net income (loss) $ 827 $ ( 453 ) Other comprehensive income (loss), net of tax Change in unrealized appreciation of fixed maturity securities on which allowance for credit losses was taken 35 30 Change in unrealized appreciation (depreciation) of all other investments ( 1,176 ) 3,132 Change in fair value of market risk benefits attributable to changes in our own credit risk ( 23 ) 74 Change in the discount rates used to measure traditional and limited payment long-duration insurance contracts 543 ( 465 ) Change in cash flow hedges ( 20 ) ( 4 ) Change in foreign currency translation adjustments ( 3 ) 36 Change in retirement plan liabilities — 2 Other comprehensive income (loss) ( 644 ) 2,805 Comprehensive income (loss) 183 2,352 Less: Comprehensive income (loss) attributable to noncontrolling interests ( 52 ) 15 Comprehensive income (loss) attributable to Corebridge $ 235 $ 2,337 See accompanying Notes to Condensed Consolidated Financial Statements (unaudited) Corebridge | First Quarter 2024 Form 10-Q 6 TABLE OF CONTENTS Corebridge Financial, Inc. Condensed Consolidated Statements of Equity (unaudited) (in millions) Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Corebridge Shareholders' Equity Non- Redeemable Noncontrolling Interests Total Shareholders' Equity Three Months Ended March 31, 2024 Balance, beginning of year $ 6 $ ( 503 ) $ 8,149 $ 17,572 $ ( 13,458 ) $ 11,766 $ 869 $ 12,635 Common stock issued under stock plans 1 27 ( 27 ) — — 1 — 1 Purchase of common stock — ( 241 ) — — — ( 241 ) — ( 241 ) Net income (loss) attributable to Corebridge or noncontrolling interests — — — 878 — 878 ( 51 ) 827 Dividends on common stock — — — ( 143 ) — ( 143 ) — ( 143 ) Other comprehensive loss, net of tax — — — — ( 643 ) ( 643 ) ( 1 ) ( 644 ) Changes in noncontrolling interests due to divestitures and acquisitions — — — — — — 1 1 Contributions from noncontrolling interests — — — — — — 21 21 Distributions to noncontrolling interests — — — — — — ( 29 ) ( 29 ) Other — — ( 7 ) 3 ( 38 ) ( 42 ) — ( 42 ) Balance, end of period $ 7 $ ( 717 ) $ 8,115 $ 18,310 $ ( 14,139 ) $ 11,576 $ 810 $ 12,386 Three Months Ended March 31, 2023 Balance, beginning of year $ 6 $ — $ 8,030 $ 18,207 $ ( 16,863 ) $ 9,380 $ 939 $ 10,319 Net income (loss) attributable to Corebridge or noncontrolling interests — — — ( 459 ) — ( 459 ) 6 ( 453 ) Dividends on common stock — — — ( 149 ) — ( 149 ) — ( 149 ) Other comprehensive income, net of tax — — — — 2,796 2,796 9 2,805 Changes in noncontrolling interests due to divestitures and acquisitions — — — — — — ( 19 ) ( 19 ) Contributions from noncontrolling interests — — — — — — 25 25 Distributions to noncontrolling interests — — — — — — ( 50 ) ( 50 ) Other — — ( 6 ) ( 7 ) — ( 13 ) — ( 13 ) Balance, end of period $ 6 $ — $ 8,024 $ 17,592 $ ( 14,067 ) $ 11,555 $ 910 $ 12,465 See accompanying Notes to Condensed Consolidated Financial Statements (unaudited) Corebridge | First Quarter 2024 Form 10-Q 7 TABLE OF CONTENTS Corebridge Financial, Inc. Condensed Consolidated Statements of Cash Flows ( unaudited) Three Months Ended March 31, (in millions) 2024 2023 Cash flows from operating activities: Net income (loss) $ 827 $ ( 453 ) Adjustments to reconcile net income to net cash provided by operating activities: Non-cash revenues, expenses, gains and losses included in income (loss): Net losses (gains) on sales of securities available-for-sale and other assets 370 89 Net (gain) loss on divestitures ( 5 ) 3 Unrealized (gains) losses in earnings - net 557 151 Change in the fair value of market risk benefits in earnings, net ( 892 ) 316 Equity in income from equity method investments, net of dividends or distributions 30 ( 22 ) Depreciation and other amortization 64 105 Impairments of assets 26 — Changes in operating assets and liabilities: Insurance liabilities 354 41 Premiums and other receivables and payables - net ( 154 ) ( 17 ) Funds held relating to Fortitude Re Reinsurance contracts ( 489 ) 538 Reinsurance assets and funds held under reinsurance treaties 227 58 Capitalization of deferred policy acquisition costs ( 340 ) ( 318 ) Current and deferred income taxes - net 187 ( 220 ) Other, net ( 164 ) 30 Total adjustments ( 229 ) 754 Net cash provided by operating activities 598 301 Cash flows from investing activities: Proceeds from (payments for) Sales or distributions of: Available-for-sale securities 2,734 2,621 Other securities 135 208 Other invested assets 324 226 Divestitures, net — 32 Maturities of fixed maturity securities available-for-sale 2,820 1,876 Principal payments received on mortgage and other loans receivable 961 714 Purchases of: Available-for-sale securities ( 7,298 ) ( 4,558 ) Other securities ( 177 ) ( 413 ) Other invested assets ( 194 ) ( 259 ) Mortgage and other loans receivable ( 2,111 ) ( 1,868 ) Net change in short-term investments 162 100 Net change in derivative assets and liabilities 45 ( 301 ) Other, net ( 46 ) 145 Net cash used in investing activities ( 2,645 ) ( 1,477 ) Cash flows from financing activities: Proceeds from (payments for): Policyholder contract deposits 8,504 8,226 Policyholder contract withdrawals ( 7,150 ) ( 6,468 ) Issuance of debt of consolidated investment entities 57 39 Maturities and repayments of debt of consolidated investment entities ( 122 ) ( 142 ) Dividends paid on common stock ( 143 ) ( 149 ) Distributions to noncontrolling interests ( 29 ) ( 50 ) Contributions from noncontrolling interests 21 25 Net change in securities lending and repurchase agreements 1,125 ( 442 ) Issuance of common stock 1 — Repurchase of common stock ( 243 ) — Other, net ( 177 ) 26 Net cash provided by (used in) financing activities 1,844 1,065 Effect of exchange rate changes on cash and restricted cash 1 2 Net increase (decrease) in cash and restricted cash ( 202 ) ( 109 ) Cash and restricted cash at beginning of year 628 633 Change in cash of businesses held for sale — — Cash and restricted cash at end of period $ 426 $ 524 See accompanying Notes to Condensed Consolidated Financial Statements (unaudited) Corebridge | First Quarter 2024 Form 10-Q 8 TABLE OF CONTENTS Corebridge Financial, Inc. Condensed Consolidated Statements of Cash Flows ( unaudited) (continued) Supplementary Disclosure of Consolidated Cash Flow Information Three Months Ended March 31, (in millions) 2024 2023 Cash $ 410 $ 465 Restricted cash included in short-term investments 3 55 Restricted cash included in other assets 13 4 Total cash and restricted cash shown in the Condensed Consolidated Statements of Cash Flows $ 426 $ 524 Cash (received) paid during the period for: Interest $ 61 $ 83 Taxes $ 2 $ 4 Non-cash investing activities: Fixed maturity securities, designated available-for-sale, received in connection with pension risk transfer transactions $ ( 1,316 ) $ ( 1,424 ) Fixed maturity securities, designated fair value option, received in connection with reinsurance transactions $ ( 14 ) $ — Fixed maturity securities, designated available-for-sale, transferred in connection with reinsurance transactions $ 119 $ 456 Fixed maturity securities, designated fair value option, transferred in connection with reinsurance transactions $ 11 $ — Non-cash financing activities: Interest credited to policyholder contract deposits included in financing activities $ 1,146 $ 1,107 Fee income debited to policyholder contract deposits included in financing activities $ ( 529 ) $ ( 525 ) See accompanying Notes to Condensed Consolidated Financial Statements (unaudited) Corebridge | First Quarter 2024 Form 10-Q 9 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 1. Overview and Basis of Presentation 1. Overview and Basis of Presentation Corebridge Financial, Inc. (“Corebridge Parent”) is a leading provider of retirement solutions and life insurance products in the United States. Our primary business operations consist of sales of individual and group annuities and life insurance products to individuals and institutional markets products. Corebridge Parent common stock, par value $ 0.01 per share, is listed on the New York Stock Exchange (NYSE:CRBG). The terms “Corebridge,” “we,” “us,” “our” or the “Company” mean Corebridge Parent and its consolidated subsidiaries, unless the context refers to Corebridge Parent only. Subsidiaries of Corebridge Parent include: AGC Life Insurance Company (“AGC”), American General Life Insurance Company (“AGL”), The Variable Annuity Life Insurance Company (“VALIC”), The United States Life Insurance Company in the City of New York (“USL”), Corebridge Insurance Company of Bermuda, Ltd. (" CRBG Bermuda") and SAFG Capital LLC and its subsidiaries. These unaudited Condensed Consolidated Financial Statements present the results of operations, financial condition and cash flows of the Company. On September 19, 2022, we completed an initial public offering (the “IPO”) in which American International Group, Inc. (“AIG Parent”) sold 80.0 million shares of Corebridge Parent common stock to the public. Since our IPO, AIG Parent has sold 159.8 million shares of Corebridge Parent common stock and we have repurchased 17.2 million shares of our common stock from AIG Parent. As of March 31, 2024, AIG Parent owned approximately 52.7 % of the outstanding common stock of Corebridge Parent. AIG Parent is a publicly traded entity, listed on the New York Stock Exchange (NYSE: AIG). The term “AIG” means AIG Parent and its consolidated subsidiaries, unless the context refers to AIG Parent only. These Condensed Consolidated Financial Statements include the results of Corebridge Parent, its controlled subsidiaries (generally through a greater than 50% ownership of voting rights and voting interests) and variable interest entities (“VIEs”) of which we are the primary beneficiary. Equity investments in entities that we do not consolidate, including corporate entities in which we have significant influence and partnership and partnership-like entities in which we have more than minor influence over the operating and financial policies, are accounted for under the equity method unless we have elected the fair value option. The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (‘‘GAAP’’). All material intercompany accounts and transactions between consolidated entities have been eliminated. The Company has recorded affiliated transactions with certain AIG subsidiaries that are not subsidiaries of Corebridge which have not been eliminated in the Condensed Consolidated Financial Statements of the Company. The accompanying Condensed Consolidated Financial Statements reflect all normal recurring adjustments, including eliminations of material intercompany accounts and transactions, necessary in the opinion of management for a fair statement of our financial position, results of operations and cash flows for the periods presented. SALE OF BUSINESSES AIG Life Limited (“AIG Life”) On April 8, 2024, Corebridge completed the sale of AIG Life Limited (“AIG Life”) to Aviva plc and received gross proceeds of £ 453 million ($ 569 million). For further details on this transaction, see Note 4. Laya Healthcare Ltd. (“Laya”) On October 31, 2023 Corebridge completed the sale of Laya to AXA and received gross proceeds of € 691 million ($ 731 million) resulting in a pre-tax gain of $ 652 million for the year ended December 31, 2023. USE OF ESTIMATES The preparation of financial statements in accordance with GAAP requires the application of accounting policies that often involve a significant degree of judgment. Accounting policies that we believe are most dependent on the application of estimates and assumptions are considered our critical accounting estimates and are related to the determination of: • fair value measurements of certain financial assets and liabilities; • valuation of market risk benefits (“MRBs”) related to guaranteed benefit features of variable annuity, fixed annuity and fixed index annuity products;valuation of embedded derivative liabilities for fixed index annuity and index universal life products; • valuation of future policy benefit liabilities and recognition of remeasurement gains and losses; • reinsurance assets, including the allowance for credit losses; • goodwill impairment; • allowance for credit losses primarily on loans and available-for-sale fixed maturity securities; and • income tax assets and liabilities, including recoverability of our net deferred tax asset and the predictability of future tax operating profitability of the character necessary to realize the net deferred tax asset. These accounting estimates require the use of assumptions about matters, some of which are highly uncertain at the time of estimation. To the extent actual experience differs from the assumptions used, our consolidated financial condition, results of operations and cash flows could be materially affected. Out-of-period adjustment In the first quarter of 2024, the Company recorded a $ 67 million out-of-period adjustment, which increased earnings, primarily related to the correction of net investment income for certain securities. The Company evaluated the impact of the error and out-of-period adjustment and concluded it was not material to any previously issued interim or annual consolidated financial statements and the adjustment is not expected to be material to the year ending December 31, 2024. 2. Summary of Significant Accounting Policies ACCOUNTING STANDARDS ADOPTED DURING 2024 Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASU”) to the FASB Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. Fair Value Measurement On June 30, 2022, the FASB issued an ASU to address diversity in practice by clarifying that a contractual sale restriction should not be considered in the measurement of the fair value of an equity security. It also requires entities with investments in equity securities subject to contractual sale restrictions to disclose certain qualitative and quantitative information about such securities. The Company adopted the standard on January 1, 2024, prospectively for entities other than investment companies. The adoption of the standard did not have a material impact to our consolidated financial statements. FUTURE APPLICATION OF ACCOUNTING STANDARDS Income Taxes In December 2023, the FASB issued an ASU to address improvements to income tax disclosures. The standard requires disaggregated information about a company’s effective tax rate reconciliation as well as information on income taxes paid. The standard is effective for public companies for annual periods beginning after December 15, 2024, with early adoption permitted. The standard will be applied on a prospective basis with the option to apply the standard retrospectively. We are assessing the impact of this standard. Segment Reporting In November 2023, the FASB issued an ASU to address improvements to reportable segment disclosures. The standard primarily requires the following disclosure on an annual and interim basis: i) significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, and ii) other segment items and description of its composition. The standard also requires current annual disclosures about a reportable segment’s profits or losses and assets to be disclosed in interim periods and the title and position of the CODM with an explanation of how the CODM uses the reported measure(s) of segment profits or losses in assessing segment performance. The guidance is effective for public companies for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The ASU is applied retrospectively to all prior periods presented. We are assessing the impact of this standard. Corebridge | First Quarter 2024 Form 10-Q 10 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3. Segment Information 3. Segment Information We report our results of operations consistent with the manner in which our chief operating decision maker reviews the business to assess performance and allocate resources. We report our results of operations as five reportable segments: • Individual Retirement – consists of fixed annuities, fixed index annuities and variable annuities. • Group Retirement – consists of recordkeeping, plan administrative and compliance services, financial planning and advisory solutions offered in-plan, along with proprietary and limited non-proprietary annuities, advisory and brokerage products offered out-of-plan. • Life Insurance – primary products in the United States include term life and universal life insurance. The International Life business issues individual and group life insurance in the United Kingdom and distributed private medical insurance in Ireland. On October 31, 2023 Corebridge completed the sale of Laya and on April 8, 2024 completed the sale of AIG Life. • Institutional Markets – consists of stable value wrap (“SVW”) products, structured settlement and pension risk transfer (“PRT”) annuities, guaranteed investment contracts (“GICs”) and Corporate Markets products that include corporate- and bank-owned life insurance (“COLI-BOLI”), private placement variable universal life and private placement variable annuity products. • Corporate and Other – consists primarily of: – corporate expenses not attributable to our other segments; – interest expense on financial debt; – results of our consolidated investment entities; – institutional asset management business, which includes managing assets for non-consolidated affiliates; and – results of our legacy insurance lines ceded to Fortitude Re. We evaluate segment performance based on adjusted revenues and adjusted pre-tax operating income (loss) (“APTOI”). Adjusted revenues are derived by excluding certain items from total revenues. APTOI is derived by excluding certain items from income from operations before income tax. These items generally fall into one or more of the following broad categories: legacy matters having no relevance to our current businesses or operating performance; adjustments to enhance transparency to the underlying economics of transactions; and adjustments that we believe to be common to the industry. Legal entities are attributed to each segment based upon the predominance of activity in that legal entity. APTOI excludes the impact of the following items: Fortitude Re related adjustments: The modified coinsurance (“modco”) reinsurance agreements with Fortitude Re transfer the economics of the invested assets supporting the reinsurance agreements to Fortitude Re. Accordingly, the net investment income on Fortitude Re funds withheld assets and the net realized gains (losses) on Fortitude Re funds withheld assets are excluded from APTOI. Similarly, changes in the Fortitude Re funds withheld embedded derivative are also excluded from APTOI. The ongoing results associated with the reinsurance agreement with Fortitude Re have been excluded from APTOI as these are not indicative of our ongoing business operations. Investment-related adjustments: APTOI excludes “Net realized gains (losses)”, except for gains (losses) related to the disposition of real estate investments. Net realized gains (losses), except for gains (losses) related to the disposition of real estate investments, are excluded as the timing of sales on invested assets or changes in allowances depend largely on market credit cycles and can vary considerably across periods. In addition, changes in interest rates may create opportunistic scenarios to buy or sell invested assets. Our derivative results, including those used to economically hedge insurance liabilities or are recognized as embedded derivatives at fair value are also included in Net realized gains (losses) and are similarly excluded from APTOI except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedges or for asset replication. Earned income on such economic hedges is reclassified from Net realized gains and losses to specific APTOI line items based on the economic risk being hedged (e.g., Net investment income and Interest credited to policyholder account balances). Corebridge | First Quarter 2024 Form 10-Q 11 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3. Segment Information Market Risk Benefits adjustments: Certain of our variable annuity, fixed annuity and fixed index annuity contracts contain guaranteed minimum withdrawal benefits (“GMWBs”) and/or guaranteed minimum death benefits (“GMDBs”) which are accounted for as MRBs. Changes in the fair value of these MRBs (excluding changes related to our own credit risk), including certain rider fees attributed to the MRBs, along with changes in the fair value of derivatives used to hedge MRBs are recorded through “Change in the fair value of MRBs, net” and are excluded from APTOI. Changes in the fair value of securities used to economically hedge MRBs are excluded from APTOI. Other adjustments: Other adjustments represent all other adjustments that are excluded from APTOI and includes the net pre-tax operating income (losses) from noncontrolling interests related to consolidated investment entities. The excluded adjustments include, as applicable: • restructuring and other costs related to initiatives designed to reduce operating expenses, improve efficiency and simplify our organization; • non-recurring costs associated with the implementation of non-ordinary course legal or regulatory changes or changes to accounting principles; • separation costs; • non-operating litigation reserves and settlements; • loss (gain) on extinguishment of debt, if any; • losses from the impairment of goodwill, if any; and • income and loss from divested or run-off business, if any. Corebridge | First Quarter 2024 Form 10-Q 12 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 3. Segment Information The following table presents Corebridge’s operations by segment: (in millions) Individual Retirement Group Retirement Life Insurance Institutional Markets Corporate & Other Eliminations Total Corebridge Adjustments Total Consolidated Three Months Ended March 31, 2024 Premiums $ 41 $ 5 $ 434 $ 1,796 $ 19 $ — $ 2,295 $ — $ 2,295 Policy fees 191 107 368 48 — — 714 — 714 Net investment income (a) 1,339 495 326 487 ( 10 ) ( 8 ) 2,629 295 2,924 Net realized gains (losses) (a)(b) — — — — ( 8 ) — ( 8 ) ( 312 ) ( 320 ) Advisory fee and other income 116 83 — 1 23 — 223 — 223 Total adjusted revenues 1,687 690 1,128 2,332 24 ( 8 ) 5,853 ( 17 ) 5,836 Policyholder benefits 36 3 748 2,023 — — 2,810 ( 3 ) 2,807 Change in the fair value of market risk benefits, net — — — — — — — ( 369 ) ( 369 ) Interest credited to policyholder account balances 639 298 83 169 — — 1,189 10 1,199 Amortization of deferred policy acquisition costs 149 21 94 3 — — 267 — 267 Non-deferrable insurance commissions 90 29 19 5 — — 143 — 143 Advisory fee expenses 35 33 — — — — 68 — 68 General operating expenses 116 106 130 20 86 — 458 114 572 Interest expense — — — — 137 ( 5 ) 132 6 138 Net (gain) loss on divestitures — — — — — — — ( 5 ) ( 5 ) Total benefits and expenses 1,065 490 1,074 2,220 223 ( 5 ) 5,067 ( 247 ) 4,820 Noncontrolling interests — — — — 51 — 51 Adjusted pre-tax operating income (loss) $ 622 $ 200 $ 54 $ 112 $ ( 148 ) $ ( 3 ) $ 837 Adjustments to: Total revenue ( 17 ) Total expenses ( 247 ) Noncontrolling interests ( 51 ) Income before income tax expense (benefit) $ 1,016 $ 1,016 Three Months Ended March 31, 2023 Premiums $ 78 $ 6 $ 425 $ 1,575 $ 20 $ — $ 2,104 $ 1 $ 2,105 Policy fees 174 100 375 49 — — 698 — 698 Net investment income (a) 1,128 500 317 332 68 ( 10 ) 2,335 360 2,695 Net realized gains (losses) (a)(b) — — — — 4 — 4 ( 1,462 ) ( 1,458 ) Advisory fee and other income 103 76 29 — 14 — 222 — 222 Total adjusted revenues 1,483 682 1,146 1,956 106 ( 10 ) 5,363 ( 1,101 ) 4,262 Policyholder benefits 65 9 708 1,718 — — 2,500 ( 5 ) 2,495 Change in the fair value of market risk benefits, net — — — — — — — 196 196 Interest credited to policyholder account balances 519 291 82 123 — — 1,015 11 1,026 Amortization of deferred policy acquisition costs 137 21 96 2 — — 256 — 256 Non-deferrable insurance commissions 86 28 17 5 — — 136 — 136 Advisory fee expenses 34 29 2 — — — 65 — 65 General operating expenses 108 118 159 23 91 — 499 83 582 Interest expense — — — — 172 ( 10 ) 162 10 172 Net (gain) loss on divestitures — — — — — — — 3 3 Total benefits and expenses 949 496 1,064 1,871 263 ( 10 ) 4,633 298 4,931 Noncontrolling interests — — — — ( 6 ) — ( 6 ) Adjusted pre-tax operating income (loss) $ 534 $ 186 $ 82 $ 85 $ ( 163 ) $ — $ 724 Adjustments to: Total revenue ( 1,101 ) Total expenses 298 Noncontrolling interests 6 Income before income tax expense (benefit) $ ( 669 ) $ ( 669 ) (a) Adjustments include Fortitude Re activity of $ 190 million and $( 611 ) million for the three months ended March 31, 2024 and 2023, respectively. (b) Net realized gains (losses) includes the gains (losses) related to the disposition of real estate investments. Corebridge | First Quarter 2024 Form 10-Q 13 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 4. Held-For-Sale Classification 4. Held-For-Sale Classification HELD-FOR-SALE CLASSIFICATION We report and classify a business as held-for-sale (“Held-For-Sale Business”) when management has approved or received approval to sell the business and is committed to a formal plan, the business is available for immediate sale, the business is being actively marketed, the sale is anticipated to occur during the next 12 months and certain other specified criteria are met. A Held-For-Sale Business is recorded at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying amount of the business exceeds its estimated fair value less cost to sell, a loss is recognized. Assets and liabilities related to a Held-For-Sale Business are segregated and reported in Assets held-for-sale and Liabilities held-for-sale, respectively, in our Condensed Consolidated Balance Sheets beginning in the period in which the business is classified as held-for-sale. At March 31, 2024, the following businesses were reported and classified as held-for-sale: AIG Life On April 8, 2024, Corebridge completed the sale of AIG Life to Aviva plc and received gross proceeds of £ 453 million ($ 569 million). The results of AIG Life are reported in the Life segment. Other Other primarily consists of real estate. The following table summarizes the components of assets and liabilities held-for-sale on the Condensed Consolidated Balance Sheet at March 31, 2024 and December 31, 2023 after elimination of intercompany balances: March 31, 2024 December 31, 2023 (in millions) AIG Life Other Total AIG Life Other Total Assets: Bonds available-for-sale $ 160 $ — $ 160 $ 167 $ — $ 167 Other invested assets — 167 167 — 67 67 Short-term investments 24 — 24 11 — 11 Cash — — — 3 — 3 Accrued investment income 3 — 3 3 — 3 Premiums and other receivables, net of allowance for credit losses and disputes 131 — 131 116 — 116 Reinsurance assets - other, net of allowance for credit losses and disputes 882 — 882 899 — 899 Deferred income taxes 47 — 47 47 — 47 Deferred policy acquisition costs 841 — 841 814 — 814 Other assets* 82 12 94 83 27 110 Total assets held-for-sale $ 2,170 $ 179 $ 2,349 $ 2,143 $ 94 $ 2,237 Liabilities: Future policy benefits for life and accident and health insurance contracts $ 842 $ — $ 842 $ 838 $ — $ 838 Other liabilities 931 — 931 908 — 908 Total liabilities held-for-sale $ 1,773 $ — $ 1,773 $ 1,746 $ — $ 1,746 * Other assets includes goodwill and other intangibles of $ 23 million and $ 3 million, respectively for AIG Life at March 31, 2024 and $ 23 million and $ 3 million, respectively at December 31, 2023. Corebridge | First Quarter 2024 Form 10-Q 14 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements 5. Fair Value Measurements FAIR VALUE MEASUREMENTS ON A RECURRING BASIS Assets and liabilities recorded at fair value in the Condensed Consolidated Balance Sheets are measured and classified in accordance with a fair value hierarchy consisting of three “levels” based on the observability of valuation inputs: • Level 1: Fair value measurements based on quoted prices (unadjusted) in active markets that we have the ability to access for identical assets or liabilities. Market price data generally is obtained from exchange or dealer markets. We do not adjust the quoted price for such instruments. • Level 2: Fair value measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. • Level 3: Fair value measurements based on valuation techniques that use significant inputs that are unobservable. Both observable and unobservable inputs may be used to determine the fair values of positions classified in Level 3. The circumstances for using these measurements include those in which there is little, if any, market activity for the asset or liability. Therefore, we must make certain assumptions about the inputs a hypothetical market participant would use to value that asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Corebridge | First Quarter 2024 Form 10-Q 15 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS The following table presents information about assets and liabilities measured at fair value on a recurring basis and indicates the level of the fair value measurement based on the observability of the inputs used: March 31, 2024 Level 1 Level 2 Level 3 Counterparty Netting (a) Cash Collateral Total (in millions) Assets: Bonds available-for-sale: U.S. government and government sponsored entities $ — $ 1,364 $ — $ — $ — $ 1,364 Obligations of states, municipalities and political subdivisions — 4,612 829 — — 5,441 Non-U.S. governments — 3,987 — — — 3,987 Corporate debt — 102,596 1,575 — — 104,171 RMBS (b) — 9,236 6,354 — — 15,590 CMBS — 9,755 547 — — 10,302 CLO — 10,039 1,729 — — 11,768 ABS — 1,170 15,033 — — 16,203 Total bonds available-for-sale — 142,759 26,067 — — 168,826 Other bond securities: U.S. government and government sponsored entities — — — — — — Obligations of states, municipalities and political subdivisions — 38 1 — — 39 Non-U.S. governments — 13 — — — 13 Corporate debt — 2,527 177 — — 2,704 RMBS (c) — 63 106 — — 169 CMBS — 223 17 — — 240 CLO — 375 71 — — 446 ABS — 88 947 — — 1,035 Total other bond securities — 3,327 1,319 — — 4,646 Equity securities 31 — 45 — — 76 Other invested assets (d) — — 1,671 — — 1,671 Derivative assets: Interest rate contracts — 2,778 407 — — 3,185 Foreign exchange contracts — 999 — — — 999 Equity contracts — 1,804 1,072 — — 2,876 Credit contracts — 78 — — — 78 Other contracts — 1 12 — — 13 Counterparty netting and cash collateral — — — ( 4,279 ) ( 2,381 ) ( 6,660 ) Total derivative assets — 5,660 1,491 ( 4,279 ) ( 2,381 ) 491 Short-term investments 12 1,245 — — — 1,257 Market risk benefit assets — — 1,172 — — 1,172 Separate account assets 91,858 3,315 — — — 95,173 Total (e) $ 91,901 $ 156,306 $ 31,765 $ ( 4,279 ) $ ( 2,381 ) $ 273,312 Liabilities: Policyholder contract deposits (f) $ — $ 131 $ 8,550 $ — $ — $ 8,681 Derivative liabilities: Interest rate contracts — 3,057 — — — 3,057 Foreign exchange contracts — 317 — — — 317 Equity contracts — 1,174 54 — — 1,228 Credit contracts — — — — — — Other contracts — — 1 — — 1 Counterparty netting and cash collateral — — — ( 4,279 ) ( 166 ) ( 4,445 ) Total derivative liabilities — 4,548 55 ( 4,279 ) ( 166 ) 158 Fortitude Re funds withheld payable (g) — — 2,211 — — 2,211 Market risk benefit liabilities — — 5,167 — — 5,167 Total $ — $ 4,679 $ 15,983 $ ( 4,279 ) $ ( 166 ) $ 16,217 Corebridge | First Quarter 2024 Form 10-Q 16 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements December 31, 2023 Level 1 Level 2 Level 3 Counterparty Netting (a) Cash Collateral Total (in millions) Assets: Bonds available-for-sale: U.S. government and government sponsored entities $ 20 $ 1,200 $ — $ — $ — $ 1,220 Obligations of states, municipalities and political subdivisions — 4,987 844 — — 5,831 Non-U.S. governments — 4,057 — — — 4,057 Corporate debt — 104,725 1,357 — — 106,082 RMBS (b) — 8,423 5,854 — — 14,277 CMBS — 9,373 608 — — 9,981 CLO — 9,301 1,843 — — 11,144 ABS — 1,029 12,906 — — 13,935 Total bonds available-for-sale 20 143,095 23,412 — — 166,527 Other bond securities: Obligations of states, municipalities and political subdivisions — 39 1 — — 40 Non-U.S. governments — 13 — — — 13 Corporate debt — 2,486 167 — — 2,653 RMBS (c) — 63 107 — — 170 CMBS — 211 17 — — 228 CLO — 354 69 — — 423 ABS — 89 962 — — 1,051 Total other bond securities — 3,255 1,323 — — 4,578 Equity securities 21 — 42 — — 63 Other invested assets (d) — — 1,850 — — 1,850 Derivative assets: Interest rate contracts — 2,498 449 — — 2,947 Foreign exchange contracts — 940 — — — 940 Equity contracts 7 1,186 824 — — 2,017 Credit contracts — 8 — — — 8 Other contracts — 1 12 — — 13 Counterparty netting and cash collateral — — — ( 3,646 ) ( 1,886 ) ( 5,532 ) Total derivative assets 7 4,633 1,285 ( 3,646 ) ( 1,886 ) 393 Short-term investments 21 1,387 — — — 1,408 Market risk benefit assets — — 912 — — 912 Separate account assets 87,813 3,192 — — — 91,005 Total (e) $ 87,882 $ 155,562 $ 28,824 $ ( 3,646 ) $ ( 1,886 ) $ 266,736 Liabilities: Policyholder contract deposits (f) $ — $ 108 $ 7,942 $ — $ — $ 8,050 Derivative liabilities: Interest rate contracts — 3,278 — — — 3,278 Foreign exchange contracts — 563 — — — 563 Equity contracts 2 680 63 — — 745 Other contracts — — 2 — — 2 Counterparty netting and cash collateral — — — ( 3,646 ) ( 801 ) ( 4,447 ) Total derivative liabilities 2 4,521 65 ( 3,646 ) ( 801 ) 141 Fortitude Re funds withheld payable (g) — — 2,182 — — 2,182 Market risk benefit liabilities — — 5,705 — — 5,705 Total $ 2 $ 4,629 $ 15,894 $ ( 3,646 ) $ ( 801 ) $ 16,078 (a) Represents netting of derivative exposures covered by qualifying master netting agreements. (b) Includes investments in residential-backed mortgage securities (“RMBS”) issued by related parties of $ 35 million and $ 7 million classified as Level 2 and Level 3, respectively, as of March 31, 2024. Additionally, includes investments in RMBS issued by related parties of $ 36 million and $ 7 million classified as Level 2 and Level 3, respectively, as of December 31, 2023. (c) Includes less than $ 1 million of investments in RMBS issued by related parties classified as Level 2 as of March 31, 2024 and December 31, 2023. (d) Excludes investments that are measured at fair value using the net asset value (“NAV”) per share (or its equivalent), which totaled $ 5.8 billion and $ 5.8 billion as of March 31, 2024 and December 31, 2023, respectively. (e) Excludes assets that were reclassified to Assets held-for-sale in the Condensed Consolidated Balance Sheets of $ 160 million and $ 167 million, as of March 31, 2024 and December 31, 2023, respectively. See Note 4 f or additional information. (f) Excludes basis adjustments for fair value hedges. Corebridge | First Quarter 2024 Form 10-Q 17 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements (g) As discussed in Note 8 , the Fortitude Re funds withheld payable is created through modco and funds withheld reinsurance arrangements where the investments supporting the reinsurance agreements are withheld by and continue to reside on Corebridge’s Condensed Consolidated Balance Sheets. This embedded derivative is valued as a total return swap with reference to the fair value of the invested assets held by Corebridge, which are primarily available-for-sale securities. CHANGES IN LEVEL 3 RECURRING FAIR VALUE MEASUREMENTS The following tables present changes during the three months ended March 31, 2024 and 2023 in Level 3 assets and liabilities measured at fair value on a recurring basis, and the realized and unrealized gains (losses) related to the Level 3 assets and liabilities in the Condensed Consolidated Balance Sheets at March 31, 2024 and 2023: (in millions) Fair Value Beginning of Year Net Realized and Unrealized Gains (Losses) Included in Income Other Comprehensive Income (Loss) Purchases, Sales, Issuances and Settlements, Net Gross Transfers In Gross Transfers Out Other Fair Value End of Period Changes in Unrealized Gains (Losses) Included in Income on Instruments Held at End of Period Changes in Unrealized Gains (Losses) Included in Other Comprehensive Income (Loss) for Recurring Level 3 Instruments Held at End of Period Three Months Ended March 31, 2024 Assets: Bonds available-for-sale: Obligations of states, municipalities and political subdivisions $ 844 $ — $ ( 14 ) $ ( 1 ) $ — $ — $ — $ 829 $ — $ ( 16 ) Corporate debt 1,357 1 1 9 244 ( 37 ) — 1,575 — ( 4 ) RMBS 5,854 68 66 404 — ( 38 ) — 6,354 — 61 CMBS 608 ( 5 ) 46 ( 103 ) 127 ( 126 ) — 547 — 11 CLO 1,843 ( 21 ) 51 21 — ( 165 ) — 1,729 — 52 ABS 12,906 91 88 1,271 677 — — 15,033 — 86 Total bonds available-for-sale 23,412 134 238 1,601 1,048 ( 366 ) — 26,067 — 190 Other bond securities: Obligations of states, municipalities and political subdivisions 1 — — — — — — 1 — — Corporate debt 167 9 — — 1 — — 177 8 — RMBS 107 2 — ( 3 ) — — — 106 2 — CMBS 17 — — — — — — 17 — — CLO 69 2 — 1 — ( 1 ) — 71 2 — ABS 962 13 — ( 28 ) — — — 947 3 — Total other bond securities 1,323 26 — ( 30 ) 1 ( 1 ) — 1,319 15 — Equity securities 42 3 — — — — — 45 3 — Other invested assets 1,850 ( 80 ) ( 9 ) ( 30 ) — ( 44 ) ( 16 ) 1,671 ( 79 ) — Total (a) $ 26,627 $ 83 $ 229 $ 1,541 $ 1,049 $ ( 411 ) $ ( 16 ) $ 29,102 $ ( 61 ) $ 190 (in millions) Fair Value Beginning of Year Net Realized and Unrealized (Gains) Losses Included in Income Other Comprehensive (Income) Loss Purchases, Sales, Issuances and Settlements, Net Gross Transfers In Gross Transfers Out Other Fair Value End of Period Changes in Unrealized Gains (Losses) Included in Income on Instruments Held at End of Period Changes in Unrealized Gains (Losses) Included in Other Comprehensive Income (Loss) for Recurring Level 3 Instruments Held at End of Period Liabilities: Policyholder contract deposits $ 7,942 $ 452 $ — $ 156 $ — $ — $ — $ 8,550 $ ( 3 ) $ — Derivative liabilities, net: Interest rate contracts ( 449 ) ( 108 ) — ( 53 ) — — 203 ( 407 ) 198 — Equity contracts ( 761 ) ( 191 ) — ( 66 ) — — — ( 1,018 ) 187 — Other contracts ( 10 ) ( 16 ) — 15 — — — ( 11 ) 15 — Total derivative liabilities, net (b) ( 1,220 ) ( 315 ) — ( 104 ) — — 203 ( 1,436 ) 400 — Fortitude Re funds withheld payable 2,182 ( 22 ) — 51 — — — 2,211 195 — Debt of consolidated investment entities — — — — — — — — — — Total (c) $ 8,904 $ 115 $ — $ 103 $ — $ — $ 203 $ 9,325 $ 592 $ — Corebridge | First Quarter 2024 Form 10-Q 18 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements (in millions) Fair Value Beginning of Year Net Realized and Unrealized Gains (Losses) Included in Income Other Comprehensive Income (Loss) Purchases, Sales, Issuances and Settlements, Net Gross Transfers In Gross Transfers Out Other Fair Value End of Period Changes in Unrealized Gains (Losses) Included in Income on Instruments Held at End of Period Changes in Unrealized Gains (Losses) Included in Other Comprehensive Income (Loss) for Recurring Level 3 Instruments Held at End of Period Three Months Ended March 31, 2023 Assets: Bonds available-for-sale: Obligations of states, municipalities and political subdivisions $ 805 $ — $ 55 $ ( 2 ) $ — $ — $ — $ 858 $ — $ 43 Corporate debt 1,968 ( 102 ) 44 14 167 ( 371 ) ( 16 ) 1,704 — 51 RMBS 5,670 81 ( 40 ) ( 8 ) — ( 16 ) — 5,687 — ( 66 ) CMBS 718 7 ( 4 ) — 24 ( 27 ) — 718 — ( 25 ) CLO 1,670 9 ( 18 ) 21 54 ( 92 ) 190 1,834 — ( 16 ) ABS 9,595 42 269 804 — ( 3 ) — 10,707 — 254 Total bonds available-for-sale 20,426 37 306 829 245 ( 509 ) 174 21,508 — 241 Other bond securities: Obligations of states, municipalities and political subdivisions — — — 1 — — — 1 — — Corporate debt 417 — — ( 96 ) — ( 191 ) — 130 3 — RMBS 107 4 — 3 — — — 114 2 — CMBS 28 ( 1 ) — — — — — 27 ( 1 ) — CLO 11 9 — 1 1 ( 5 ) 54 71 4 — ABS 741 26 — 14 — — — 781 19 — Total other bond securities 1,304 38 — ( 77 ) 1 ( 196 ) 54 1,124 27 — Equity securities 26 — — 24 — — — 50 — — Other invested assets 1,832 ( 44 ) 5 59 — — — 1,852 ( 42 ) — Total (a) $ 23,588 $ 31 $ 311 $ 835 $ 246 $ ( 705 ) $ 228 $ 24,534 $ ( 15 ) $ 241 (in millions) Fair Value Beginning of Year Net Realized and Unrealized (Gains) Losses Included in Income Other Comprehensive (Income) Loss Purchases, Sales, Issuances and Settlements, Net Gross Transfers In Gross Transfers Out Other Fair Value End of Period Changes in Unrealized Gains (Losses) Included in Income on Instruments Held at End of Period Changes in Unrealized Gains (Losses) Included in Other Comprehensive Income (Loss) for Recurring Level 3 Instruments Held at End of Period Liabilities: Policyholder contract deposits $ 5,367 $ 381 $ — $ 316 $ — $ — $ — $ 6,064 $ ( 368 ) $ — Derivative liabilities, net: Interest rate contracts ( 303 ) 78 — ( 119 ) — — — ( 344 ) ( 71 ) — Equity contracts ( 156 ) ( 176 ) — ( 165 ) — — — ( 497 ) 178 — Other contracts ( 14 ) ( 16 ) — 16 — — — ( 14 ) 16 — Total derivative liabilities, net (b) ( 473 ) ( 114 ) — ( 268 ) — — — ( 855 ) 123 — Fortitude Re funds withheld payable 1,262 1,025 — ( 513 ) — — — 1,774 ( 633 ) — Debt of consolidated investment entities 6 — — — — — — 6 — — Total (c) $ 6,162 $ 1,292 $ — $ ( 465 ) $ — $ — $ — $ 6,989 $ ( 878 ) $ — (a) Excludes MRB assets of $ 1.2 billion at March 31, 2024 and $ 830 million at March 31, 2023. Refer to Note 15 for additional information. (b) Total Level 3 derivative exposures have been netted in these tables for presentation purposes only. (c) Excludes MRB liabilities of $ 5.2 billion at March 31, 2024 and $ 5.1 billion at March 31, 2023. Refer to Note 15 for additional information. Corebridge | First Quarter 2024 Form 10-Q 19 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements Change in the fair value of market risk benefits, net and net realized and unrealized gains and losses included in income related to Level 3 assets and liabilities shown above are reported in the Condensed Consolidated Statements of Income (Loss) as follows: (in millions) Policy Fees Net Investment Income Net Realized and Unrealized Gains (Losses) Change in the Fair Value of Market Risk Benefits, net (a) Total Three Months Ended March 31, 2024 Assets: Bonds available-for-sale $ — $ 159 $ ( 25 ) $ — $ 134 Other bond securities — 26 — — 26 Equity securities — 3 — — 3 Other invested assets — ( 78 ) ( 2 ) — ( 80 ) Three Months Ended March 31, 2023 Assets: Bonds available-for-sale $ — $ 32 $ 5 $ — $ 37 Other bond securities — 38 — — 38 Equity securities — — — — — Other invested assets — ( 43 ) ( 1 ) — ( 44 ) (in millions) Policy Fees Net Investment Income Net Realized and Unrealized Gains (Losses) Change in the Fair Value of Market Risk Benefits, net (a) Total Three Months Ended March 31, 2024 Liabilities: Policyholder contract deposits (b) $ — $ — $ ( 452 ) $ — $ ( 452 ) Derivative liabilities, net 15 — 363 ( 63 ) 315 Fortitude Re funds withheld payable — — 22 — 22 Market risk benefit liabilities, net (c) — — 2 1,069 1,071 Three Months Ended March 31, 2023 Liabilities: Policyholder contract deposits (b) $ — $ — $ ( 381 ) $ — $ ( 381 ) Derivative liabilities, net 16 — 197 ( 99 ) 114 Fortitude Re funds withheld payable — — ( 1,025 ) — ( 1,025 ) Market risk benefit liabilities, net (c) — — — ( 87 ) ( 87 ) (a) The portion of the fair value change attributable to our own credit risk is recognized in Other comprehensive income (loss) (OCI). (b) Primarily embedded derivatives. (c) Market risk benefit assets and liabilities have been netted in these tables for presentation purposes only. Corebridge | First Quarter 2024 Form 10-Q 20 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements The following table presents the gross components of purchases, sales, issuances and settlements, net, shown above, for the three months ended March 31, 2024 and 2023 related to Level 3 assets and liabilities in the Condensed Consolidated Balance Sheets: (in millions) Purchases Sales Issuances and Settlements Purchases, Sales, Issuances and Settlements, Net Three Months Ended March 31, 2024 Assets: Bonds available-for-sale: Obligations of states, municipalities and political subdivisions $ — $ — $ ( 1 ) $ ( 1 ) Corporate debt 15 — ( 6 ) 9 RMBS 574 — ( 170 ) 404 CMBS — ( 30 ) ( 73 ) ( 103 ) CLO 130 ( 2 ) ( 107 ) 21 ABS 1,704 ( 53 ) ( 380 ) 1,271 Total bonds available-for-sale 2,423 ( 85 ) ( 737 ) 1,601 Other bond securities: Obligations of states, municipalities and political subdivisions — — — — Corporate debt — — — — RMBS — — ( 3 ) ( 3 ) CMBS — — — — CLO 1 — — 1 ABS 29 — ( 57 ) ( 28 ) Total other bond securities 30 — ( 60 ) ( 30 ) Equity securities — — — — Other invested assets 62 — ( 92 ) ( 30 ) Total assets* $ 2,515 $ ( 85 ) $ ( 889 ) $ 1,541 Liabilities: Policyholder contract deposits $ — $ 332 $ ( 176 ) $ 156 Derivative liabilities, net ( 1 ) — ( 103 ) ( 104 ) Fortitude Re funds withheld payable — — 51 51 Total liabilities $ ( 1 ) $ 332 $ ( 228 ) $ 103 Three Months Ended March 31, 2023 Assets: Bonds available-for-sale: Obligations of states, municipalities and political subdivisions $ — $ — $ ( 2 ) $ ( 2 ) Corporate debt 28 — ( 14 ) 14 RMBS 167 — ( 175 ) ( 8 ) CMBS 9 ( 6 ) ( 3 ) — CLO 10 — 11 21 ABS 858 — ( 54 ) 804 Total bonds available-for-sale 1,072 ( 6 ) ( 237 ) 829 Other bond securities: Obligations of states, municipalities and political subdivisions 1 — — 1 Corporate debt — — ( 96 ) ( 96 ) RMBS 6 — ( 3 ) 3 CMBS — — — — CLO 1 — — 1 ABS 32 — ( 18 ) 14 Total other bond securities 40 — ( 117 ) ( 77 ) Equity securities 24 — — 24 Other invested assets 70 — ( 11 ) 59 Total assets* $ 1,206 $ ( 6 ) $ ( 365 ) $ 835 Liabilities: Policyholder contract deposits $ — $ 326 $ ( 10 ) $ 316 Derivative liabilities, net ( 101 ) — ( 167 ) ( 268 ) Fortitude Re funds withheld payable — — ( 513 ) ( 513 ) Total liabilities $ ( 101 ) $ 326 $ ( 690 ) $ ( 465 ) * There were no issuances during the three months ended March 31, 2024 and 2023 for invested assets. Corebridge | First Quarter 2024 Form 10-Q 21 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements Both observable and unobservable inputs may be used to determine the fair values of positions classified in Level 3 in the tables above. As a result, the unrealized gains (losses) on instruments held at March 31, 2024 and 2023 may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable inputs (e.g., changes in unobservable long-dated volatilities). Transfers of Level 3 Assets and Liabilities We record transfers of assets and liabilities into or out of Level 3 at their fair values as of the end of each reporting period, consistent with the date of the determination of fair value. The Net realized and unrealized gains (losses) included in net income (loss) or other comprehensive income (“OCI”) as shown in the table above excludes $( 8 ) million and $ 7 million of net gains (losses) related to assets transferred into Level 3 during the three months ended March 31, 2024 and 2023, respectively, and includes $ 4 million and $ 11 million of net gains (losses) related to assets transferred out of Level 3 during the three months ended March 31, 2024 and 2023, respectively. Transfers of Level 3 Assets During the three months ended March 31, 2024 and 2023, transfers into Level 3 assets primarily included certain investments in private placement corporate debt, commercial mortgage backed securities (“CMBS”), collateralized loan obligations (“CLO”) and asset-backed securities (“ABS”). Transfers of private placement corporate debt and certain ABS into Level 3 assets were primarily the result of limited market pricing information that required us to determine fair value for these securities based on inputs that are adjusted to better reflect our own assumptions regarding the characteristics of a specific security or associated market liquidity. The transfers of investments in CMBS, CLO and certain ABS into Level 3 assets were due to diminished market transparency and liquidity for individual security types. During the three months ended March 31, 2024 and 2023, transfers out of Level 3 assets primarily included private placement and other corporate debt, CMBS, RMBS, CLO, ABS and certain investments in municipal securities. Transfers of certain investments in municipal securities, corporate debt, RMBS, CMBS and CLO and ABS out of Level 3 assets were based on consideration of market liquidity as well as related transparency of pricing and associated observable inputs for these investments. Transfers of certain investments in private placement corporate debt and certain ABS out of Level 3 assets were primarily the result of using observable pricing information that reflects the fair value of those securities without the need for adjustment based on our own assumptions regarding the characteristics of a specific security or the current liquidity in the market. Transfers of Level 3 Liabilities There were no significant transfers of derivative or other liabilities into or out of Level 3 for the three months ended March 31, 2024 and 2023. Corebridge | First Quarter 2024 Form 10-Q 22 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS The table below presents information about the significant unobservable inputs used for recurring fair value measurements for certain Level 3 instruments, and includes only those instruments for which information about the inputs is reasonably available to us, such as data from independent third-party valuation service providers and from internal valuation models. Because input information from third parties with respect to certain Level 3 instruments (primarily CLO/ABS) may not be reasonably available to us, balances shown below may not equal total amounts reported for such Level 3 assets and liabilities: (in millions) Fair Value at March 31, 2024 Valuation Technique Unobservable Input (a) Range (Weighted Average) (b) Assets: Obligations of states, municipalities and political subdivisions $ 806 Discounted cash flow Yield 5.10 % - 5.39 % ( 5.24 %) Corporate debt $ 1,581 Discounted cash flow Yield 5.27 % - 9.21 % ( 7.24 %) RMBS (c) $ 3,338 Discounted cash flow Prepayment Speed 4.34 % - 9.96 % ( 7.15 %) Default Rate 0.75 % - 2.53 % ( 1.64 %) Yield 5.63 % - 7.01 % ( 6.32 %) Loss Severity 33.61 % - 87.20 % ( 60.41 %) CLO (c) $ 1,709 Discounted cash flow Yield 6.62 % - 7.93 % ( 7.28 %) ABS (c) $ 13,559 Discounted cash flow Yield 5.75 % - 7.79 % ( 6.77 %) CMBS $ 521 Discounted cash flow Yield 5.22 % - 17.77 % ( 11.12 %) Market risk benefit assets $ 1,172 Discounted cash flow Equity volatility 6.35 % - 49.95 % Base lapse rate 0.16 % - 28.80 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 38.25 % - 160.01 % Utilization (g) 80.00 % - 100.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.06 % - 2.33 % Liabilities (d) : Market risk benefit liabilities Variable annuities guaranteed benefits $ 1,675 Discounted cash flow Equity volatility 6.35 % - 49.95 % Base lapse rate 0.16 % - 28.80 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 38.25 % - 160.01 % Utilization (g) 80.00 % - 100.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.06 % - 2.33 % Fixed annuities guaranteed benefits $ 1,130 Discounted cash flow Base lapse rate 0.20 % - 15.75 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 40.26 % - 168.43 % Utilization (g) 90.00 % - 97.50 % NPA (h) 0.06 % - 2.33 % Fixed index annuities guaranteed benefits $ 2,362 Discounted cash flow Equity volatility 6.35 % - 49.95 % Base lapse rate 0.20 % - 50.00 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 24.00 % - 146.00 % Utilization (g) 60.00 % - 97.50 % Option budget 0.00 % - 6.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.06 % - 2.33 % Corebridge | First Quarter 2024 Form 10-Q 23 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements (in millions) Fair Value at March 31, 2024 Valuation Technique Unobservable Input (a) Range (Weighted Average) (b) Embedded derivatives within Policyholder contract deposits: Index credits on fixed index annuities (i) $ 7,603 Discounted cash flow Equity volatility 6.35 % - 49.95 % Base lapse rate 0.20 % - 50.00 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 24.00 % - 146.00 % Utilization (g) 60.00 % - 97.50 % Option Budget 0.00 % - 6.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.06 % - 2.33 % Index universal life $ 947 Discounted cash flow Base lapse rate 0.00 % - 37.97 % Mortality rates 0.00 % - 100.00 % Equity Volatility 5.85 % - 19.95 % NPA (h) 0.06 % - 2.33 % (in millions) Fair Value at December 31, 2023 Valuation Technique Unobservable Input (a) Range (Weighted Average) (b) Assets: Obligations of states, municipalities and political subdivisions $ 821 Discounted cash flow Yield 4.97 % - 5.31 % ( 5.14 %) Corporate debt $ 1,471 Discounted cash flow Yield 5.26 % - 8.16 % ( 6.71 %) RMBS (c) $ 3,315 Discounted cash flow Prepayment Speed 4.31 % - 9.86 % ( 7.09 %) Default Rate 0.73 % - 2.52 % ( 1.63 %) Yield 6.11 % - 7.40 % ( 6.75 %) Loss Severity 30.64 % - 91.03 % ( 60.83 %) CLO (c) $ 1,697 Discounted cash flow Yield 6.06 % - 7.81 % ( 6.93 %) ABS (c) $ 11,367 Discounted cash flow Yield 5.63 % - 7.82 % ( 6.73 %) CMBS $ 565 Discounted cash flow Yield 5.49 % - 17.84 % ( 11.66 %) Market risk benefit assets $ 912 Discounted cash flow Equity volatility 6.25 % - 49.75 % Base lapse rate 0.16 % - 28.80 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 38.25 % - 160.01 % Utilization (g) 80.00 % - 100.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.00 % - 2.29 % Liabilities (d) : Market risk benefit liabilities Variable annuities guaranteed benefits $ 2,174 Discounted cash flow Equity volatility 6.25 % - 49.75 % Base lapse rate 0.16 % - 28.80 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 38.25 % - 160.01 % Utilization (g) 80.00 % - 100.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.00 % - 2.29 % Fixed annuities guaranteed benefits $ 1,111 Discounted cash flow Base lapse rate 0.20 % - 15.75 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 40.26 % - 168.43 % Utilization (g) 90.00 % - 97.50 % NPA (g) 0.00 % - 2.29 % Corebridge | First Quarter 2024 Form 10-Q 24 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements (in millions) Fair Value at December 31, 2023 Valuation Technique Unobservable Input (a) Range (Weighted Average) (b) Fixed index annuities guaranteed benefits $ 2,420 Discounted cash flow Equity volatility 6.25 % - 49.75 % Base lapse rate 0.20 % - 50.00 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 24.00 % - 146.00 % Utilization (g) 60.00 % - 97.50 % Option budget 0.00 % - 6.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.00 % - 2.29 % Embedded derivatives within Policyholder contract deposits: Index credits on fixed index annuities (i) $ 6,953 Discounted cash flow Equity volatility 6.25 % - 49.75 % Base lapse rate 0.20 % - 50.00 % Dynamic lapse multiplier (e) 20.00 % - 186.18 % Mortality multiplier (e)(f) 24.00 % - 146.00 % Utilization (g) 60.00 % - 97.50 % Option Budget 0.00 % - 6.00 % Equity / interest-rate correlation 0.00 % - 30.00 % NPA (h) 0.00 % - 2.29 % Index universal life $ 989 Discounted cash flow Base lapse rate 0.00 % - 37.97 % Mortality rates 0.00 % - 100.00 % Equity Volatility 5.85 % - 20.36 % NPA (h) 0.00 % - 2.29 % (a) Represents discount rates, estimates and assumptions that we believe would be used by market participants when valuing these assets and liabilities. (b) The weighted averaging for fixed maturity securities is based on the estimated fair value of the securities. Because the valuation methodology for embedded derivatives within policyholder contract deposits and MRBs uses a range of inputs that vary at the contract level over the cash flow projection period, management believes that presenting a range, rather than weighted average, is a more meaningful representation of the unobservable inputs used in the valuation. (c) Information received from third-party valuation service providers. The ranges of the unobservable inputs for constant prepayment rate, loss severity and constant default rate relate to each of the individual underlying mortgage loans that comprise the entire portfolio of securities in the RMBS and CLO securitization vehicles and not necessarily to the securitization vehicle bonds (tranches) purchased by us. The ranges of these inputs do not directly correlate to changes in the fair values of the tranches purchased by us because there are other factors relevant to the fair values of specific tranches owned by us, including, but not limited to, purchase price, position in the waterfall, senior versus subordinated position and attachment points. (d) The Fortitude Re funds withheld payable has been excluded from the above table. As discussed in Note 8 , the Fortitude Re funds withheld payable is created through modco and funds withheld reinsurance arrangements where the investments supporting the reinsurance agreements are withheld by and continue to reside on Corebridge’s Condensed Consolidated Balance Sheets. This embedded derivative is valued as a total return swap with reference to the fair value of the invested assets held by Corebridge. Accordingly, the unobservable inputs utilized in the valuation of the embedded derivative are a component of the invested assets supporting the reinsurance agreements that are held on Corebridge’s Condensed Consolidated Balance Sheets. (e) The ranges for these inputs vary due to the different GMWB product specification and policyholder characteristics across in-force policies. Policyholder characteristics that affect these ranges include age, policy duration, and gender. (f) Mortality inputs are shown as multipliers of the 2012 Individual Annuity Mortality Basic table. (g) The partial withdrawal utilization unobservable input range shown applies only to policies with GMWB riders. (h) The NPA applied as a spread over risk-free curve for discounting. (i) The fixed index annuities embedded derivative associated with index credits related to the contracts with guaranteed product features included in policyholder contract deposits was $ 1.7 billion and $ 1.5 billion at March 31, 2024 and December 31, 2023, respectively. The ranges of reported inputs for obligations of states, municipalities and political subdivisions, corporate debt, RMBS, CLO/ABS and CMBS valued using a discounted cash flow technique consist of one standard deviation in either direction from the value-weighted average. The preceding table does not give effect to our risk management practices that might offset risks inherent in these Level 3 assets and liabilities. Corebridge | First Quarter 2024 Form 10-Q 25 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements Interrelationships Between Unobservable Inputs We consider unobservable inputs to be those for which market data is not available and that are developed using the best information available to us about the assumptions that market participants would use when pricing the asset or liability. Relevant inputs vary depending on the nature of the instrument being measured at fair value. The following paragraphs provide a general description of significant unobservable inputs along with interrelationships between and among the significant unobservable inputs and their impact on the fair value measurements. In practice, simultaneous changes in assumptions may not always have a linear effect on the inputs discussed below. Interrelationships may also exist between observable and unobservable inputs. Such relationships have not been included in the discussion below. For each of the individual relationships described below, the inverse relationship would also generally apply. Fixed Maturity Securities The significant unobservable input used in the fair value measurement of fixed maturity securities is yield. The yield is affected by the market movements in credit spreads and U.S. Treasury yields. The yield may be affected by other factors, including constant prepayment rates, loss severity and constant default rates. In general, increases in the yield would decrease the fair value of investments, and conversely, decreases in the yield would increase the fair value of investments. MRBs and Embedded Derivatives within Policyholder Contract Deposits For MRBs and embedded derivatives, the assumptions for unobservable inputs vary throughout the period over which cash flows are projected for valuation purposes. The following are applicable unobservable inputs: • Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available. Increases in assumed volatility will generally increase the fair value of both the projected cash flows from rider fees as well as the projected cash flows related to benefit payments. Therefore, the net change in the fair value of the liability may be either a decrease or an increase, depending on the relative changes in projected rider fees and projected benefit payments. • Equity and interest rate correlation estimates the relationship between changes in equity returns and interest rates in the economic scenario generator used to value our MRBs. In general, a higher positive correlation assumes that equity markets and interest rates move in a more correlated fashion, which generally increases the fair value of the liability. Only our fixed index annuities with a GMWB rider are subject to the equity and interest correlation assumption. Other policies such as accumulation fixed index annuity and life products do not use a correlation assumption. • Base lapse rate assumptions are determined by company experience and judgment and are adjusted at the contract level using a dynamic lapse function, which reduces the base lapse rate when the contract is in-the-money (when the contract holder’s guaranteed value, as estimated by the company, is worth more than their underlying account value). Lapse rates are also generally assumed to be lower in periods when a surrender charge applies. Increases in assumed lapse rates will generally decrease the fair value of the liability as fewer policyholders would persist to collect guaranteed benefit amounts. • Mortality rate assumptions, which vary by age and gender, are based on company experience and include a mortality improvement assumption. Increases in assumed mortality rates will decrease the fair value of the GMWB liability, while lower mortality rate assumptions will generally increase the fair value of the liability because guaranteed withdrawal payments will be made for a longer period of time and generally exceed any decrease in guaranteed death benefits. • Utilization assumptions estimate the timing when policyholders with a GMWB will elect to utilize their benefit and begin taking withdrawals. The assumptions may vary by the type of guarantee, tax-qualified status, the contract’s withdrawal history and the age of the policyholder. Utilization assumptions are based on company experience, which includes partial withdrawal behavior. Increases in assumed utilization rates will generally increase the fair value of the liability. • Non-performance or “own credit” risk adjustment used in the valuation of MRBs and embedded derivatives, which reflects a market participant’s view of our claims-paying ability by incorporating a different spread (the “NPA spread”) to the curve used to discount projected benefit cash flows. When corporate credit spreads widen, the change in the NPA spread generally reduces the fair value of the MRBs and embedded derivatives, resulting in a gain in Accumulated other comprehensive income (“AOCI”) or Net realized gains (losses), respectively, and when corporate credit spreads narrow or tighten, the change in the NPA spread generally increases the fair value of the MRBs and embedded derivatives, resulting in a loss in AOCI or Net realized gains (losses), respectively. • The projected cash flows incorporate best estimate assumptions for policyholder behavior (including mortality, lapses, withdrawals and benefit utilization), along with an explicit risk margin to reflect a market participant’s estimates of the fair value of projected cash flows and policyholder behavior. Estimates of future policyholder behavior assumptions are subjective and based primarily on our historical experience. Corebridge | First Quarter 2024 Form 10-Q 26 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements • For embedded derivatives, option budgets estimate the expected long-term cost of options used to hedge exposures associated with index price changes. The level of option budgets determines future costs of the options, which impacts the growth in account value and the valuation of embedded derivatives. Embedded Derivatives within Reinsurance Contracts The fair value of embedded derivatives associated with funds withheld reinsurance contracts is determined based upon a total return swap technique with reference to the fair value of the investments held by Corebridge related to Corebridge’s funds withheld payable. The fair value of the underlying assets is generally based on market observable inputs using industry standard valuation techniques. The valuation also requires certain significant inputs, which are generally not observable, and accordingly, the valuation is considered Level 3 in the fair value hierarchy. INVESTMENTS IN CERTAIN ENTITIES CARRIED AT FAIR VALUE USING NET ASSET VALUE PER SHARE The following table includes information related to our investments in certain other invested assets, including private equity funds, hedge funds and other alternative investments that calculate net asset value per share (or its equivalent). For these investments, which are measured at fair value on a recurring basis, we use the net asset value per share to measure fair value: March 31, 2024 December 31, 2023 (in millions) Investment Category Includes Fair Value Using NAV Per Share (or its equivalent) Unfunded Commitments Fair Value Using NAV Per Share (or its equivalent) Unfunded Commitments Investment Category Private equity funds: Leveraged buyout Debt and/or equity investments made as part of a transaction in which assets of mature companies are acquired from the current shareholders, typically with the use of financial leverage $ 2,519 $ 1,758 $ 2,445 $ 1,755 Real estate Investments in real estate properties and infrastructure positions, including power plants and other energy generating facilities 996 583 1,074 540 Venture capital Early-stage, high-potential, growth companies expected to generate a return through an eventual realization event, such as an initial public offering or sale of the company 194 88 203 91 Growth equity Funds that make investments in established companies for the purpose of growing their businesses 486 105 485 109 Mezzanine Funds that make investments in the junior debt and equity securities of leveraged companies 124 39 152 42 Other Includes distressed funds that invest in securities of companies that are in default or under bankruptcy protection, as well as funds that have multi-strategy, and other strategies 1,225 202 1,182 233 Total private equity funds 5,544 2,775 5,541 2,770 Hedge funds: Event-driven Securities of companies undergoing material structural changes, including mergers, acquisitions and other reorganizations 4 — 4 — Long-short Securities that the manager believes are undervalued, with corresponding short positions to hedge market risk 156 — 161 — Macro Investments that take long and short positions in financial instruments based on a top-down view of certain economic and capital market conditions 37 — 69 — Other Includes investments held in funds that are less liquid, as well as other strategies which allow for broader allocation between public and private investments 59 — 65 — Total hedge funds 256 — 299 — Total $ 5,800 $ 2,775 $ 5,840 $ 2,770 Corebridge | First Quarter 2024 Form 10-Q 27 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements Private equity fund investments included above are not redeemable, because distributions from the funds will be received when underlying investments of the funds are liquidated. Private equity funds are generally expected to have 10 -year lives at their inception, but these lives may be extended at the fund manager’s discretion, typically in one-year or two-year increments. The majority of our hedge fund investments are redeemable upon a single month or quarter’s notice, though redemption terms vary from single, immediate withdrawals, to withdrawals staggered up to eight quarters. Some of the portfolio consists of illiquid run-off or “side-pocket” positions whose liquidation horizons are uncertain and likely beyond a year after submission of the redemption notice. FAIR VALUE OPTION The following table presents the gains or losses recorded related to the eligible instruments for which we elected the fair value option: Three Months Ended March 31, (in millions) 2024 2023 Assets: Other bond securities (a) $ 84 $ 115 Alternative investments (b) 51 1 Total assets 135 116 Liabilities: Policyholder contract deposits (c) 1 ( 1 ) Total liabilities 1 ( 1 ) Total gain (loss) $ 136 $ 115 (a) Includes certain securities supporting the funds withheld arrangements with Fortitude Re . For additional information regarding the gains and losses for Other bond securities, see Note 6. For additional information regarding the funds withheld arrangements with Fortitude Re, see Note 8. (b) Includes certain hedge funds, private equity funds and other investment partnerships. (c) Represents GICs. We calculate the effect of these credit spread changes using discounted cash flow techniques that incorporate current market interest rates, our observable credit spreads on these liabilities and other factors that mitigate the risk of non-performance such as cash collateral posted. FAIR VALUE MEASUREMENTS ON A NON-RECURRING BASIS The following table presents assets measured at fair value on a non-recurring basis at the time of impairment and the related impairment charges recorded during the periods presented: Assets at Fair Value Impairment Charges Non-Recurring Basis Three Months Ended March 31, (in millions) Level 1 Level 2 Level 3 Total 2024 2023 March 31, 2024 Other investments $ — $ — $ 98 $ 98 $ 25 $ — Total $ — $ — $ 98 $ 98 $ 25 $ — December 31, 2023 Other investments $ — $ — $ 80 $ 80 Total $ — $ — $ 80 $ 80 In addition to the assets presented in the table above, at March 31, 2024, Corebridge had no loans held for sale which are carried at fair value, determined on an individual loan basis. There is no associated impairment charge. Corebridge | First Quarter 2024 Form 10-Q 28 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 5. Fair Value Measurements FAIR VALUE INFORMATION ABOUT FINANCIAL INSTRUMENTS NOT MEASURED AT FAIR VALUE The following table presents the carrying amounts and estimated fair values of our financial instruments not measured at fair value and indicates the level in the fair value hierarchy of the estimated fair value measurement based on the observability of the inputs used: Estimated Fair Value (in millions) Level 1 Level 2 Level 3 Total Carrying Value March 31, 2024 Assets: Mortgage and other loans receivable $ — $ 29 $ 44,590 $ 44,619 $ 47,830 Other invested assets — 273 — 273 273 Short-term investments (a) — 2,887 — 2,887 2,887 Cash (b) 410 — — 410 410 Other assets 13 — — 13 13 Liabilities: Policyholder contract deposits associated with investment-type contracts — 86 136,106 136,192 141,851 Fortitude Re funds withheld payable — — 23,112 23,112 23,112 Other liabilities — 3,585 — 3,585 3,585 Short-term debt — 250 — 250 250 Long-term debt — 8,662 — 8,662 9,118 Debt of consolidated investment entities — 67 2,225 2,292 2,530 Separate account liabilities - investment contracts — 91,243 — 91,243 91,243 December 31, 2023 Assets: Mortgage and other loans receivable $ — $ 30 $ 43,919 $ 43,949 $ 46,867 Other invested assets — 268 — 268 268 Short-term investments (a) — 2,928 — 2,928 2,928 Cash (b) 612 — — 612 612 Other assets 13 — — 13 13 Liabilities: Policyholder contract deposits associated with investment-type contracts — 90 130,094 130,184 140,652 Fortitude Re funds withheld payable — — 23,775 23,775 23,775 Other liabilities — 2,467 — 2,467 2,467 Short-term debt — 250 — 250 250 Long-term debt — 8,722 — 8,722 9,118 Debt of consolidated investment entities — 43 2,230 2,273 2,504 Separate account liabilities - investment contracts — 87,215 — 87,215 87,215 (a) Excludes assets that were reclassified to Assets held-for-sale in the Condensed Consolidated Balance Sheets of $ 24 million and $ 11 million as of March 31, 2024 and December 31, 2023, respectively. See Note 4 for additional information. (b) Excludes assets that were reclassified to Assets held-for-sale in the Condensed Consolidated Balance Sheets of $ 0 million and $ 3 million as of March 31, 2024 and December 31, 2023, respectively. See Note 4 for additional information. Corebridge | First Quarter 2024 Form 10-Q 29 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments 6. Investments SECURITIES AVAILABLE-FOR-SALE The following table presents the amortized cost or cost and fair value of our available-for-sale securities: (in millions) Amortized Cost or Costs (a) Allowance for Credit Losses (b) Gross Unrealized Gains (c) Gross Unrealized Losses (c) Fair Value (a) March 31, 2024 Bonds available-for-sale: U.S. government and government sponsored entities $ 1,626 $ — $ 10 $ ( 272 ) $ 1,364 Obligations of states, municipalities and political subdivisions 6,130 — 41 ( 730 ) 5,441 Non-U.S. governments 4,713 — 33 ( 759 ) 3,987 Corporate debt 120,047 ( 61 ) 1,053 ( 16,868 ) 104,171 Mortgage-backed, asset-backed and collateralized: RMBS 15,807 ( 19 ) 625 ( 823 ) 15,590 CMBS 11,215 ( 17 ) 43 ( 939 ) 10,302 CLO 11,729 — 125 ( 86 ) 11,768 ABS 17,136 — 79 ( 1,012 ) 16,203 Total mortgage-backed, asset-backed and collateralized 55,887 ( 36 ) 872 ( 2,860 ) 53,863 Total bonds available-for-sale $ 188,403 $ ( 97 ) $ 2,009 $ ( 21,489 ) $ 168,826 December 31, 2023 Bonds available-for-sale: U.S. government and government sponsored entities $ 1,436 $ — $ 17 $ ( 233 ) $ 1,220 Obligations of states, municipalities and political subdivisions 6,466 — 58 ( 693 ) 5,831 Non-U.S. governments 4,695 ( 2 ) 43 ( 679 ) 4,057 Corporate debt 120,654 ( 71 ) 1,294 ( 15,795 ) 106,082 Mortgage-backed, asset-backed and collateralized: RMBS 14,491 ( 25 ) 599 ( 788 ) 14,277 CMBS 11,045 ( 30 ) 22 ( 1,056 ) 9,981 CLO 11,203 — 90 ( 149 ) 11,144 ABS 14,956 — 63 ( 1,084 ) 13,935 Total mortgage-backed, asset-backed and collateralized 51,695 ( 55 ) 774 ( 3,077 ) 49,337 Total bonds available-for-sale $ 184,946 $ ( 128 ) $ 2,186 $ ( 20,477 ) $ 166,527 (a) The table above includes available-for-sale securities issued by related parties. This includes RMBS which had a fair value of $ 42 million and $ 43 million, and an amortized cost of $ 45 million and $ 45 million as of March 31, 2024 and December 31, 2023, respectively. (b) Changes in the allowance for credit losses are recorded through Net realized gains (losses) and are not recognized in OCI. (c) At March 31, 2024 includes mark-to-market movement (“MTM”) relating to embedded derivatives. Corebridge | First Quarter 2024 Form 10-Q 30 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments Securities Available-for-Sale in a Loss Position for Which No Allowance for Credit Loss Has Been Recorded The following table summarizes the fair value and gross unrealized losses on our available-for-sale securities, aggregated by major investment category and length of time that individual securities have been in a continuous unrealized loss position for which no allowance for credit loss has been recorded: Less Than 12 Months 12 Months or More Total (in millions) Fair Value Gross Unrealized Losses* Fair Value Gross Unrealized Losses* Fair Value Gross Unrealized Losses* March 31, 2024 Bonds available-for-sale: U.S. government and government sponsored entities $ 209 $ 6 $ 713 $ 266 $ 922 $ 272 Obligations of states, municipalities and political subdivisions 975 110 3,580 620 4,555 730 Non-U.S. governments 646 105 2,832 654 3,478 759 Corporate debt 12,342 2,040 72,528 14,798 84,870 16,838 RMBS 2,889 121 5,354 678 8,243 799 CMBS 828 35 6,766 898 7,594 933 CLO 2,550 24 3,047 61 5,597 85 ABS 2,942 110 8,285 902 11,227 1,012 Total bonds available-for-sale $ 23,381 $ 2,551 $ 103,105 $ 18,877 $ 126,486 $ 21,428 December 31, 2023 Bonds available-for-sale: U.S. government and government sponsored entities $ 22 $ 3 $ 746 $ 230 $ 768 $ 233 Obligations of states, municipalities and political subdivisions 1,124 110 3,676 583 4,800 693 Non-U.S. governments 470 82 2,981 592 3,451 674 Corporate debt 11,338 1,760 75,045 14,009 86,383 15,769 RMBS 2,676 174 4,855 577 7,531 751 CMBS 1,840 159 6,570 886 8,410 1,045 CLO 2,992 60 3,823 89 6,815 149 ABS 2,599 110 8,138 974 10,737 1,084 Total bonds available-for-sale $ 23,061 $ 2,458 $ 105,834 $ 17,940 $ 128,895 $ 20,398 * At March 31, 2024 includes mark to market movement relating to embedded derivatives. At March 31, 2024, we held 14,892 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 12,625 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more). At December 31, 2023, we held 15,034 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 12,787 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more). We did not recognize the unrealized losses in earnings on these fixed maturity securities at March 31, 2024 because it was determined that such losses were due to non-credit factors. Additionally, we neither intend to sell the securities nor do we believe that it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. For fixed maturity securities with significant declines, we performed fundamental credit analyses on a security-by-security basis, which included consideration of credit enhancements, liquidity position, expected defaults, industry and sector analysis, forecasts and available market data. Contractual Maturities of Fixed Maturity Securities Available-for-Sale The following table presents the amortized cost and fair value of fixed maturity securities available-for-sale by contractual maturity: Total Fixed Maturity Securities Available-for-sale (in millions) Amortized Cost, Net of Allowance Fair Value March 31, 2024 Due in one year or less $ 3,145 $ 3,108 Due after one year through five years 22,934 22,317 Due after five years through ten years 23,340 21,467 Due after ten years 83,036 68,071 Mortgage-backed, asset-backed and collateralized 55,851 53,863 Total $ 188,306 $ 168,826 Corebridge | First Quarter 2024 Form 10-Q 31 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay certain obligations with or without call or prepayment penalties. The following table presents the gross realized gains and gross realized losses from sales or maturities of our available-for-sale securities: Three Months Ended March 31, 2024 2023 (in millions) Gross Realized Gains Gross Realized Losses Gross Realized Gains Gross Realized Losses Fixed maturity securities $ 3 $ ( 345 ) $ 46 $ ( 139 ) For the three months ended March 31, 2024 and 2023, the aggregate fair value of available-for-sale securities sold was $ 2.5 billion and $ 2.7 billion, respectively, which resulted in Net realized gains (losses) of $( 342 ) million and $( 93 ) million, respectively. Included within the Net realized gains (losses) for the three months ended March 31, 2024 and 2023,are $( 22 ) million and $( 17 ) million of Net realized gains (losses) which relate to the Fortitude Re funds withheld assets held by Corebridge in support of Fortitude Re’s reinsurance obligations to Corebridge (Fortitude Re funds withheld assets). These Net realized gains (losses) are included in Net realized gains (losses) on Fortitude Re funds withheld assets. OTHER SECURITIES MEASURED AT FAIR VALUE The following table presents the fair value of fixed maturity securities measured at fair value, including securities in the modco agreement with Fortitude Re, based on our election of the fair value option and equity securities measured at fair value: March 31, 2024 December 31, 2023 (in millions) Fair Value Percent of Total Fair Value Percent of Total Fixed maturity securities: Obligations of states, municipalities and political subdivisions $ 39 1 % $ 40 1 % Non-U.S. governments 13 — 13 — Corporate debt 2,704 57 2,653 57 Mortgage-backed, asset-backed and collateralized: RMBS 169 4 170 4 CMBS 240 5 228 5 CLO 446 9 423 9 ABS 1,035 22 1,051 23 Total mortgage-backed, asset-backed and collateralized 1,890 40 1,872 41 Total fixed maturity securities 4,646 98 4,578 99 Equity securities 76 2 63 1 Total $ 4,722 100 % $ 4,641 100 % OTHER INVESTED ASSETS The following table summarizes the carrying amounts of other invested assets: (in millions) March 31, 2024 December 31, 2023 Alternative investments (a)(b) $ 7,523 $ 7,690 Investment real estate (c) 1,896 1,932 All other investments (d) 617 635 Total $ 10,036 $ 10,257 (a) At March 31, 2024, included hedge funds of $ 256 million and private equity funds of $ 7.3 billion. At December 31, 2023, included hedge funds of $ 299 million and private equity funds of $ 7.4 billion. (b) The majority of our hedge fund investments are redeemable upon a single month or quarter’s notice, though redemption terms vary from single, immediate withdrawals, to withdrawals staggered up to eight quarters. Some of the portfolio consists of illiquid run-off or “side-pocket” positions whose liquidation horizons are uncertain and likely beyond a year after submission of the redemption notice. (c) Net of accumulated depreciation of $ 660 million and $ 680 million as of March 31, 2024 and December 31, 2023, respectively. (d) Includes Corebridge’s ownership interest in Fortitude Re Bermuda, which is recorded using the measurement alternative for equity securities. Our investment in Fortitude Re Bermuda totaled $ 156 million and $ 156 million at March 31, 2024 and December 31, 2023, respectively. Corebridge | First Quarter 2024 Form 10-Q 32 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments Other Invested Assets – Equity Method Investments The carrying amount of equity method investments totaled $ 2.7 billion and $ 2.9 billion as of March 31, 2024 and December 31, 2023, respectively, representing various ownership percentages each period. NET INVESTMENT INCOME The following table presents the components of Net investment income: Three Months Ended March 31, 2024 2023 (in millions) Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Available-for-sale fixed maturity securities, including short-term investments $ 2,184 $ 195 $ 2,379 $ 1,896 $ 217 $ 2,113 Other fixed maturity securities 13 71 84 10 105 115 Equity securities 10 — 10 29 — 29 Interest on mortgage and other loans 580 48 628 512 50 562 Alternative investments* ( 52 ) 33 ( 19 ) ( 1 ) 31 30 Real estate 12 ( 7 ) 5 4 — 4 Other investments 12 — 12 3 — 3 Total investment income 2,759 340 3,099 2,453 403 2,856 Investment expenses 167 8 175 152 9 161 Net investment income $ 2,592 $ 332 $ 2,924 $ 2,301 $ 394 $ 2,695 * Included income from hedge funds and private equity funds. Hedge funds are recorded as of the balance sheet date. Private equity funds are generally reported on a one-quarter lag. NET REALIZED GAINS AND LOSSES The following table presents the components of Net realized gains (losses): Three Months Ended March 31, 2024 2023 (in millions) Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Sales of fixed maturity securities $ ( 320 ) $ ( 22 ) $ ( 342 ) $ ( 76 ) $ ( 17 ) $ ( 93 ) Intent to sell ( 15 ) ( 32 ) ( 47 ) — — — Change in allowance for credit losses on fixed maturity securities ( 62 ) ( 6 ) ( 68 ) ( 17 ) — ( 17 ) Change in allowance for credit losses on loans ( 14 ) 2 ( 12 ) ( 34 ) ( 19 ) ( 53 ) Foreign exchange transactions, net of related hedges 46 1 47 11 7 18 Index-Linked interest credited embedded derivatives, net of related hedges 90 — 90 ( 178 ) — ( 178 ) All other derivatives and hedge accounting* 105 ( 106 ) ( 1 ) ( 164 ) 48 ( 116 ) Sales of alternative investments and real estate investments 20 ( 1 ) 19 5 1 6 Other ( 28 ) — ( 28 ) — — — Net realized gains (losses) – excluding Fortitude Re funds withheld embedded derivative ( 178 ) ( 164 ) ( 342 ) ( 453 ) 20 ( 433 ) Net realized gains (losses) on Fortitude Re funds withheld embedded derivative — 22 22 — ( 1,025 ) ( 1,025 ) Net realized gains (losses) $ ( 178 ) $ ( 142 ) $ ( 320 ) $ ( 453 ) $ ( 1,005 ) $ ( 1,458 ) * Derivative activity related to hedging MRBs is recorded in Change in the fair value of MRBs, net. For additional disclosures about MRBs, see Note 15. Corebridge | First Quarter 2024 Form 10-Q 33 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS The following table presents the increase (decrease) in unrealized appreciation (depreciation) of our available-for-sale securities: Three Months Ended March 31, (in millions) 2024 2023 Increase (decrease) in unrealized appreciation (depreciation) of investments: Fixed maturity securities $ ( 1,087 ) $ 4,019 Other investments — 1 Total increase (decrease) in unrealized appreciation (depreciation) of investments* $ ( 1,087 ) $ 4,020 * Excludes net unrealized gains and losses attributable to business Held-for-sale at March 31, 2024 and December 31, 2023. The following table summarizes the unrealized gains and losses recognized in Net investment income during the reporting period on equity securities and other invested assets still held at the reporting date: Three Months Ended March 31, 2024 2023 (in millions) Equities Other Invested Assets Total Equities Other Invested Assets Total Net gains (losses) recognized during the period on equity securities and other investments $ 10 $ 70 $ 80 $ 29 $ 31 $ 60 Less: Net gains (losses) recognized during the period on equity securities and other investments sold during the period 18 2 20 33 1 34 Unrealized gains (losses) recognized during the reporting period on equity securities and other investments still held at the reporting date $ ( 8 ) $ 68 $ 60 $ ( 4 ) $ 30 $ 26 EVALUATING INVESTMENTS FOR AN ALLOWANCE FOR CREDIT LOSSES AND IMPAIRMENTS Credit Impairments The following table presents a rollforward of the changes in allowance for credit losses on available-for-sale fixed maturity securities by major investment category: Three Months Ended March 31, 2024 2023 (in millions) Structured Non-Structured Total Structured Non-Structured Total Balance, beginning of period $ 55 $ 73 $ 128 $ 27 $ 121 $ 148 Additions: Securities for which allowance for credit losses were not previously recorded 13 17 30 2 12 14 Reductions: Securities sold during the period ( 15 ) ( 9 ) ( 24 ) ( 2 ) ( 17 ) ( 19 ) Additional net increases or decreases to the allowance for credit losses on securities that had an allowance recorded in a previous period, for which there was no intent to sell before recovery, amortized cost basis 22 16 38 — 3 3 Write-offs charged against the allowance ( 39 ) ( 37 ) ( 76 ) — ( 50 ) ( 50 ) Other — 1 1 — — — Balance, end of period $ 36 $ 61 $ 97 $ 27 $ 69 $ 96 Purchased Credit Deteriorated Securities We purchase certain RMBS securities that have experienced more-than-insignificant deterioration in credit quality since origination. These are referred to as purchased credit deteriorated assets. At the time of purchase an allowance is recognized for these purchased credit deteriorated assets by adding it to the purchase price to arrive at the initial amortized cost. There is no credit loss expense recognized upon acquisition of a purchased credit deteriorated asset. When determining the initial allowance for credit losses, management considers the historical performance of underlying assets and available market information as well as bond-specific structural considerations, such as credit enhancement and the priority of payment structure of the security. In addition, the process of estimating future cash flows includes, but is not limited to, the following critical inputs: • current delinquency rates; • expected default rates and the timing of such defaults; Corebridge | First Quarter 2024 Form 10-Q 34 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments • loss severity and the timing of any recovery; and • expected prepayment speeds. Subsequent to the acquisition date, the purchased credit deteriorated assets follow the same accounting as other structured securities that are not of high credit quality. We did not purchase securities with more-than-insignificant credit deterioration since their origination during the three months ended March 31, 2024 and 2023. PLEDGED INVESTMENTS Secured Financing and Similar Arrangements We enter into secured financing transactions whereby certain securities are sold under agreements to repurchase (repurchase agreements), in which we transfer securities in exchange for cash, with an agreement by us to repurchase the same or substantially similar securities. Our secured financing transactions also include those that involve the transfer of securities to financial institutions in exchange for cash (securities lending agreements). In all of these secured financing transactions, the securities transferred by us (pledged collateral) may be sold or repledged by the counterparties. These agreements are recorded at their contracted amounts plus accrued interest, other than those that are accounted for at fair value. Pledged collateral levels are monitored daily and are generally maintained at an agreed-upon percentage of the fair value of the amounts borrowed during the life of the transactions. In the event of a decline in the fair value of the pledged collateral under these secured financing transactions, we may be required to transfer cash or additional securities as pledged collateral under these agreements. At the termination of the transactions, we and our counterparties are obligated to return the amounts borrowed and the securities transferred, respectively. The following table presents the fair value of securities pledged to counterparties under secured financing transactions, including repurchase agreements: (in millions) March 31, 2024 December 31, 2023 Fixed maturity securities available-for-sale $ 3,651 $ 2,655 At March 31, 2024 and December 31, 2023, amounts borrowed under repurchase agreements totaled $ 3.6 billion and $ 2.5 billion, respectively. The following table presents the fair value of securities pledged under our repurchase agreements by collateral type and by remaining contractual maturity: Remaining Contractual Maturity of the Repurchase Agreements (in millions) Overnight and Continuous Up to 30 Days 31 - 90 Days 91 - 364 Days 365 Days or Greater Total March 31, 2024 Bonds available-for-sale: Non-U.S. governments $ — $ 51 $ — $ — $ — $ 51 Corporate debt 14 3,586 — — — 3,600 Total $ 14 $ 3,637 $ — $ — $ — $ 3,651 December 31, 2023 Bonds available-for-sale: Non-U.S. governments $ — $ 209 $ — $ — $ — $ 209 Corporate debt 38 2,408 — — — 2,446 Total $ 38 $ 2,617 $ — $ — $ — $ 2,655 There were no securities lending agreements at March 31, 2024 and December 31, 2023. There were no reverse repurchase agreements at March 31, 2024 and December 31, 2023. We do not currently offset any secured financing transactions. All such transactions are collateralized and margined daily consistent with market standards and subject to enforceable master netting arrangements with rights of set off. Insurance – Statutory and Other Deposits The total carrying value of cash and securities deposited by our insurance subsidiaries under requirements of regulatory authorities or other insurance-related arrangements, including certain annuity-related obligations and certain reinsurance treaties, was $ 10.1 billion and $ 8.1 billion at March 31, 2024 and December 31, 2023, respectively. Corebridge | First Quarter 2024 Form 10-Q 35 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 6. Investments Other Pledges and Restrictions Certain of our subsidiaries are members of FHLBs and such membership requires the members to own stock in these FHLBs. We owned an aggregate of $ 273 million and $ 268 million of stock in FHLBs at March 31, 2024 and December 31, 2023, respectively. In addition, our subsidiaries have pledged securities available-for-sale and residential loans associated with borrowings and funding agreements from FHLBs, with a fair value of $ 4.5 billion and $ 3.1 billion, respectively, at March 31, 2024 and $ 4.8 billion and $ 3.0 billion, respectively, at December 31, 2023. Certain GICs recorded in policyholder contract deposits with a carrying value of $ 68 million and $ 53 million at March 31, 2024 and December 31, 2023, respectively, have provisions that require collateral to be posted or payments to be made by us upon a downgrade of our Insurer Financial Strength (“IFS”) ratings. The actual amount of collateral required to be posted to the counterparties in the event of such downgrades and the aggregate amount of payments that we could be required to make depend on market conditions, the fair value of outstanding affected transactions and other factors prevailing at and after the time of the downgrade. The fair value of securities pledged as collateral with respect to these obligations was approximately $ 77 million and $ 63 million at March 31, 2024 and December 31, 2023, respectively. This collateral primarily consists of securities of the U.S. government and government-sponsored entities and generally cannot be repledged or resold by the counterparties. As part of our collateralized reinsurance transactions, we pledge collateral to cedants as contractually required. The fair value of securities pledged as excess collateral with respect to these obligations was approximately $ 598 million and $ 490 million at March 31, 2024 and December 31, 2023, respectively. Additionally, assets supporting these transactions are held solely for the benefit of the cedants and insulated from obligations owed to our other policyholders and general creditors. Reinsurance transactions between Corebridge and Fortitude Re were structured as modco with funds withheld. 7. Lending Activities The following table presents the composition of Mortgage and other loans receivable, net: (in millions) March 31, 2024 December 31, 2023 Commercial mortgages (a) $ 34,651 $ 34,172 Residential mortgages 9,000 8,445 Life insurance policy loans 1,747 1,746 Commercial loans, other loans and notes receivable (b) 3,146 3,202 Total mortgage and other loans receivable 48,544 47,565 Allowance for credit losses (c) ( 714 ) ( 698 ) Mortgage and other loans receivable, net $ 47,830 $ 46,867 (a) Commercial mortgages primarily represent loans for apartments, offices and retail properties, with exposures in New York and California representing the largest geographic concentrations (aggregating approximately 19 % and 10 %, respectively, at March 31, 2024, and 19 % and 10 %, respectively, at December 31, 2023). The weighted average loan-to-value ratio for NY and CA was 61 % and 56 % at March 31, 2024, respectively, and 61 % and 55 % at December 31, 2023, respectively. The debt service coverage ratio for NY and CA was 1.9 X and 2.1 X at March 31, 2024, respectively, and 1.9 X and 2.1 X at December 31, 2023, respectively. (b) There were no loans that were held for sale which are carried at lower of cost or market as of March 31, 2024 and December 31, 2023. (c) Does not include allowance for credit losses of $ 48 million and $ 58 million at March 31, 2024 and December 31, 2023, respectively, in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities. Interest income is not accrued when payment of contractual principal and interest is not expected. Any cash received on impaired loans is generally recorded as a reduction of the current carrying amount of the loan. Accrual of interest income is generally resumed when delinquent contractual principal and interest are repaid or when a portion of the delinquent contractual payments are made, and the ongoing required contractual payments have been made for an appropriate period. As of March 31, 2024, $ 32 million and $ 546 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status. As of December 31, 2023, $ 27 million and $ 419 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status. Accrued interest is presented separately and is included in Accrued investment income on the Condensed Consolidated Balance Sheets. As of March 31, 2024, accrued interest receivable was $ 33 million and $ 166 million associated with residential mortgage loans and commercial mortgage loans, respectively. As of December 31, 2023, accrued interest receivable was $ 20 million and $ 162 million associated with residential mortgage loans and commercial mortgage loans, respectively. A significant majority of commercial mortgages in the portfolio are non-recourse loans and, accordingly, the only guarantees are for specific items that are exceptions to the non-recourse provisions. It is therefore extremely rare for us to have cause to enforce the provisions of a guarantee on a commercial real estate or mortgage loan. Nonperforming loans are generally those loans where payment of contractual principal or interest is more than 90 days past due. Nonperforming loans were not significant for all periods presented. Corebridge | First Quarter 2024 Form 10-Q 36 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 7. Lending Activities CREDIT QUALITY OF COMMERCIAL MORTGAGES The following table presents debt service coverage ratios for commercial mortgages by year of vintage*: March 31, 2024 (in millions) 2024 2023 2022 2021 2020 Prior Total >1.2X $ 631 $ 2,037 $ 6,197 $ 2,135 $ 1,274 $ 16,026 $ 28,300 1.00 - 1.20X 71 389 1,070 1,272 311 2,461 5,574 <1.00X — — 40 — — 737 777 Total commercial mortgages $ 702 $ 2,426 $ 7,307 $ 3,407 $ 1,585 $ 19,224 $ 34,651 December 31, 2023 (in millions) 2023 2022 2021 2020 2019 Prior Total >1.2X $ 2,156 $ 6,042 $ 1,955 $ 1,252 $ 4,813 $ 11,675 $ 27,893 1.00 - 1.20X 291 1,077 1,320 312 156 2,334 5,490 <1.00X — 40 — — — 749 789 Total commercial mortgages $ 2,447 $ 7,159 $ 3,275 $ 1,564 $ 4,969 $ 14,758 $ 34,172 * The debt service coverage ratio compares a property’s net operating income to its debt service payments, including principal and interest. Our weighted average debt service coverage ratio was 1.9 X at both periods ended March 31, 2024 and December 31, 2023. The debt service coverage ratios are updated when additional relevant information becomes available. The following table presents loan-to-value ratios for commercial mortgages by year of vintage*: March 31, 2024 (in millions) 2024 2023 2022 2021 2020 Prior Total Less than 65% $ 702 $ 2,148 $ 4,559 $ 2,341 $ 1,148 $ 12,289 $ 23,187 65% to 75% — 278 2,162 660 286 4,811 8,197 76% to 80% — — — 89 — 773 862 Greater than 80% — — 586 317 151 1,351 2,405 Total commercial mortgages $ 702 $ 2,426 $ 7,307 $ 3,407 $ 1,585 $ 19,224 $ 34,651 December 31, 2023 (in millions) 2023 2022 2021 2020 2019 Prior Total Less than 65% $ 2,088 $ 4,470 $ 2,249 $ 1,126 $ 2,676 $ 10,186 $ 22,795 65% to 75% 280 1,748 658 287 1,916 2,853 7,742 76% to 80% — 343 89 — 377 340 1,149 Greater than 80% 79 598 279 151 — 1,379 2,486 Total commercial mortgages $ 2,447 $ 7,159 $ 3,275 $ 1,564 $ 4,969 $ 14,758 $ 34,172 * The loan-to-value ratio compares the current unpaid principal balance of the loan to the estimated fair value of the underlying property collateralizing the loan. Our weighted average loan-to-value ratio was 59 % at both periods ended March 31, 2024, and December 31, 2023. The loan-to-value ratios have been updated within the last three months to reflect the current carrying values of the loans. We update the valuations of collateral properties by obtaining independent appraisals, generally at least once per year. Corebridge | First Quarter 2024 Form 10-Q 37 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 7. Lending Activities The following table presents the credit quality performance indicators for commercial mortgages: (dollars in millions) Number of Loans Class Percent of Total Apartments Offices Retail Industrial Hotel Others Total March 31, 2024 Credit Quality Performance Indicator: In good standing 600 $ 13,970 $ 8,391 $ 3,743 $ 6,092 $ 1,793 $ 403 $ 34,392 99 % 90 days or less delinquent (a) 2 — 61 180 — — — 241 1 % >90 days delinquent or in process of foreclosure 1 — 18 — — — — 18 — % Total (b) 603 $ 13,970 $ 8,470 $ 3,923 $ 6,092 $ 1,793 $ 403 $ 34,651 100 % Allowance for credit losses $ 75 $ 355 $ 79 $ 89 $ 31 $ 5 $ 634 2 % December 31, 2023 Credit Quality Performance Indicator: In good standing 600 $ 13,861 $ 8,468 $ 3,787 $ 5,908 $ 1,805 $ 325 $ 34,154 100 % 90 days or less delinquent 1 — 18 — — — — 18 — % >90 days delinquent or in process of foreclosure — — — — — — — — — % Total (b) 601 $ 13,861 $ 8,486 $ 3,787 $ 5,908 $ 1,805 $ 325 $ 34,172 100 % Allowance for credit losses $ 85 $ 340 $ 74 $ 83 $ 27 $ 5 $ 614 2 % (a) Includes $ 61 million of Offices loans and $ 20 million of Retail loans supporting the Fortitude Re Funds Withheld arrangements, 90 days or less delinquent, at March 31, 2024. (b) Does not reflect allowance for credit losses. The following table presents credit quality performance indicators for residential mortgages by year of vintage: March 31, 2024 (in millions) 2024 2023 2022 2021 2020 Prior Total FICO*: 780 and greater $ 55 $ 639 $ 592 $ 2,292 $ 642 $ 737 $ 4,957 720 - 779 198 1,117 537 542 150 313 2,857 660 - 719 69 363 232 131 40 158 993 600 - 659 — 11 35 18 10 57 131 Less than 600 — 2 18 9 5 28 62 Total residential mortgages $ 322 $ 2,132 $ 1,414 $ 2,992 $ 847 $ 1,293 $ 9,000 December 31, 2023 (in millions) 2023 2022 2021 2020 2019 Prior Total FICO*: 780 and greater $ 514 $ 528 $ 2,280 $ 619 $ 239 $ 497 $ 4,677 720 - 779 1,121 608 558 168 99 209 2,763 660 - 719 313 256 113 40 37 120 879 600 - 659 2 20 11 8 9 51 101 Less than 600 — — 2 2 4 17 25 Total residential mortgages $ 1,950 $ 1,412 $ 2,964 $ 837 $ 388 $ 894 $ 8,445 * Fair Isaac Corporation (“FICO”) is the credit quality indicator used to evaluate consumer credit risk for residential mortgage loan borrowers and have been updated within the last twelve months. FICO scores for residential mortgage investor loans to corporate entities are those of the guarantor at time of purchase. On March 31, 2024 and December 31, 2023 residential loans direct to consumers totaled $ 2.3 billion and $ 1.7 billion, respectively. Corebridge | First Quarter 2024 Form 10-Q 38 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 7. Lending Activities ALLOWANCE FOR CREDIT LOSSES The following table presents a rollforward of the changes in the allowance for credit losses on Mortgage and other loans receivable*: Three Months Ended March 31, 2024 2023 (in millions) Commercial Mortgages Other Loans Total Commercial Mortgages Other Loans Total Allowance, beginning of period $ 614 $ 84 $ 698 $ 531 $ 69 $ 600 Loans charged off — ( 6 ) ( 6 ) — — — Net charge-offs — ( 6 ) ( 6 ) — — — Addition to (release of) allowance for loan losses 20 2 22 55 4 59 Divestitures — — — — — — Allowance, end of period $ 634 $ 80 $ 714 $ 586 $ 73 $ 659 * Does not include allowance for credit losses of $ 48 million and $ 54 million, respectively, at March 31, 2024 and 2023 in relation to the off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities in the Condensed Consolidated Balance Sheets Our expectations and models used to estimate the allowance for losses on commercial and residential mortgage loans are regularly updated to reflect the current economic environment. LOAN MODIFICATIONS The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon asset origination or acquisition. The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from modifications of receivables to borrowers experiencing financial difficulty. We use a probability of default/loss given default model to determine the allowance for credit losses for our commercial and residential mortgage loans. An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses utilizing the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification. When modifications are executed, they often will be in the form of principal forgiveness, term extensions, interest rate reductions, or some combination of any of these concessions. When principal is forgiven, the amortized cost basis of the asset is written off against the allowance for credit losses. The amount of the principal forgiveness is deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a corresponding adjustment to the allowance for credit losses. We assess whether a borrower is experiencing financial difficulty based on a variety of factors, including the borrower’s current default on any of its outstanding debt, the probability of a default on any of its debt in the foreseeable future without the modification, the insufficiency of the borrower’s forecasted cash flows to service any of its outstanding debt (including both principal and interest), and the borrower’s inability to access alternative third party financing at an interest rate that would be reflective of current market conditions for a non-troubled debtor. During the three months ended March 31, 2024, commercial mortgage loans with an amortized cost of $ 11 million supporting the funds withheld arrangements with Fortitude Re and commercial loans, other loans and notes receivable with an amortized cost of $ 168 million (none of which were supporting the funds withheld arrangements with Fortitude Re, and $ 168 million of which is related to the loans previously modified in 2023) were granted term extensions. The modified loans represent less than 1 % and 6 %, respectively, of these portfolio segments. These modifications added less than one year to the weighted average life of loans in each of these two portfolio segments. During the three months ended March 31, 2024 and 2023, Corebridge did not modify any loans to borrowers experiencing financial difficulty. There were no loans that defaulted during the three months ended March 31, 2024 and 2023, that had been previously modified with borrowers experiencing financial difficulties. Corebridge closely monitors the performance of the loans modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. All loans with borrowers with financial difficulty that have been modified in the previous 12 months are current and performing in conjunction with its modified terms. Corebridge | First Quarter 2024 Form 10-Q 39 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 8. Reinsurance 8. Reinsurance In the ordinary course of business, our insurance companies may use ceded reinsurance to limit potential losses, provide additional capacity for growth, minimize exposure to significant risks or to provide greater diversification of our businesses. We may also use assumed reinsurance to diversify our business. Our reinsurance is principally under yearly renewable term (“YRT”) treaties, along with a large modco treaty reinsuring the majority of our legacy business to Fortitude Re. Reinsurance premiums ceded are recognized when due, along with corresponding benefits. Amounts recoverable from reinsurers are presented as a component of Reinsurance assets. Reinsurance assets include the balances due from reinsurance and insurance companies under the terms of our reinsurance agreements for ceded future policy benefits for life and accident and health insurance contracts and benefits paid and unpaid. We remain liable to the extent that our reinsurers do not meet their obligations under the reinsurance contracts, and as such, we regularly evaluate the financial condition of our reinsurers and monitor concentration of our credit risk. The estimation of the allowance for credit losses and disputes requires judgment for which key inputs typically include historical trends regarding uncollectible balances, disputes and credit events as well as specific reviews of balances in dispute or subject to credit impairment. Changes in the allowance for credit losses and disputes on reinsurance assets are reflected in policyholder benefits within the Consolidated Statements of Income (Loss). Reinsurance recoverables are recognized in a manner consistent with the liabilities relating to the underlying reinsured contracts. FORTITUDE RE AGL, VALIC and USL, have modco agreements with Fortitude Re, a registered Class 4 and Class E reinsurer in Bermuda. In the modco, the investments supporting the reinsurance agreements, which consist mostly of available-for-sale securities, and which reflect the majority of the consideration that would be paid to the reinsurer for entering into the transaction, are withheld by, and therefore continue to reside on the balance sheet of, the ceding company (i.e., Corebridge), thereby creating an obligation for the ceding company to pay the reinsurer (i.e., Fortitude Re) at a later date. Additionally, as Corebridge maintains ownership of these investments, Corebridge will maintain its existing accounting for these assets (e.g., the changes in fair value of available-for-sale securities will be recognized within OCI). Corebridge has established a funds withheld payable to Fortitude Re while simultaneously establishing a reinsurance asset representing liabilities for the insurance coverage that Fortitude Re has assumed. The funds withheld payable contains an embedded derivative and changes in fair value of the embedded derivative related to the funds withheld payable are recognized in earnings through realized gains (losses). This embedded derivative is considered a total return swap with contractual returns that are attributable to various assets and liabilities associated with these reinsurance agreements. There is a diverse pool of assets supporting the funds withheld arrangements with Fortitude Re. The following summarizes the composition of the pool of assets: March 31, 2024 December 31, 2023 (in millions) Carrying Value Fair Value Carrying Value Fair Value Corresponding Accounting Policy Fixed maturity securities - available-for-sale $ 14,656 $ 14,656 $ 15,204 $ 15,204 Fair value through other comprehensive income Fixed maturity securities - fair value option 4,283 4,283 4,212 4,212 Fair value through net investment income Commercial mortgage loans 3,345 3,091 3,378 3,157 Amortized cost Real estate investments 175 302 184 329 Amortized cost Private equity funds/hedge funds 1,920 1,920 1,910 1,910 Fair value through net investment income Policy loans 325 325 330 330 Amortized cost Short-term Investments 161 161 129 129 Fair value through net investment income Funds withheld investment assets 24,865 24,738 25,347 25,271 Derivative assets, net (a) 14 14 45 45 Fair value through realized gains (losses) Other (b) 571 571 641 641 Amortized cost Total $ 25,450 $ 25,323 $ 26,033 $ 25,957 (a) The derivative assets and liabilities have been presented net of cash collateral. The derivative assets and liabilities supporting the Fortitude Re funds withheld arrangements had a fair market value of $ 14 million and $ 1 million, respectively, as of March 31, 2024. The derivative assets and liabilities supporting the Fortitude Re funds withheld arrangements had a fair market value of $ 62 million and $ 6 million, respectively, as of December 31, 2023. These derivative assets and liabilities are fully collateralized either by cash or securities. (b) Primarily comprised of Cash and Accrued investment income. Corebridge | First Quarter 2024 Form 10-Q 40 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 8. Reinsurance The impact of the funds withheld arrangements with Fortitude Re was as follows: Three Months Ended March 31, (in millions) 2024 2023 Net investment income - Fortitude Re funds withheld assets $ 332 $ 394 Net realized gains (losses) on Fortitude Re funds withheld assets: Net realized gains (losses) Fortitude Re funds withheld assets ( 164 ) 20 Net realized gains (losses) Fortitude Re funds withheld embedded derivatives 22 ( 1,025 ) Net realized losses on Fortitude Re funds withheld assets ( 142 ) ( 1,005 ) Income (loss) before income tax benefit (expense) 190 ( 611 ) Income tax benefit (expense)* 40 ( 128 ) Net income (loss) 150 ( 483 ) Change in unrealized appreciation (depreciation) of the invested assets supporting the Fortitude Re modco arrangement classified as available-for-sale* ( 116 ) 451 Comprehensive income (loss) $ 34 $ ( 32 ) * The income tax expense (benefit) and the tax impact in OCI was computed using the U.S. statutory tax rate of 21%. Various assets supporting the Fortitude Re funds withheld arrangements are reported at amortized cost, and as such, changes in the fair value of these assets are not reflected in the financial statements. However, changes in the fair value of these assets are included in the embedded derivative in the Fortitude Re funds withheld arrangement and the appreciation (depreciation) of the assets is the primary driver of the comprehensive income (loss) reflected above. REINSURANCE – CREDIT LOSSES The estimation of reinsurance recoverables involves a significant amount of judgment. Reinsurance assets include reinsurance recoverables on future policy benefits and policyholder contract deposits that are estimated as part of our insurance liability valuation process and, consequently, are subject to similar judgments and uncertainties as the estimation of gross benefit liabilities. We assess the collectability of reinsurance recoverable balances in each reporting period, through either historical trends of disputes and credit events or financial analysis of the credit quality of the reinsurer. We record adjustments to reflect the results of these assessments through an allowance for credit losses and disputes on uncollectible reinsurance that reduces the carrying amount of reinsurance and other assets on the Condensed Consolidated Balance Sheets (collectively, the reinsurance recoverable balances). This estimate requires significant judgment for which key considerations include: • paid and unpaid amounts recoverable; • whether the balance is in dispute or subject to legal collection; • the relative financial health of the reinsurer as classified by the Obligor Risk Ratings (“ORRs”) we assign to each reinsurer based upon our financial reviews; insurers that are financially troubled (i.e., in run-off, have voluntarily or involuntarily been placed in receivership, are insolvent, are in the process of liquidation or otherwise subject to formal or informal regulatory restriction) are assigned ORRs that will generate a significant allowance; and • whether collateral and collateral arrangements exist. An estimate of the reinsurance recoverable’s lifetime expected credit losses is established utilizing a probability of default and loss given default method, which reflects the reinsurer’s ORR. The allowance for credit losses excludes disputed amounts. An allowance for disputes is established for a reinsurance recoverable using the losses incurred model for contingencies. The total reinsurance recoverables as of March 31, 2024 were $ 27.7 billion. As of that date, utilizing Corebridge’s ORRs, (i) approximately 100 % of the reinsurance recoverables were investment grade, (ii) less than 1 % were non-investment grade reinsurance recoverables and (iii) none of the reinsurance recoverables were related to entities t hat were not rated by Corebridge. Corebridge | First Quarter 2024 Form 10-Q 41 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 8. Reinsurance Reinsurance Recoverable Allowance The following table presents a rollforward of the reinsurance recoverable allowance: Three Months Ended March 31, (in millions) 2024 2023 Balance, beginning of period $ 30 $ 84 Current period provision for expected credit losses and disputes ( 10 ) ( 10 ) Write-offs charged against the allowance for credit losses and disputes ( 2 ) — Other changes — — Balance, end of period $ 18 $ 74 There w ere no material recoveries of credit losses previously written off for th e three months ended March 31, 2024 or 2023. Past-Due Status We consider a reinsurance asset to be past due when it is 90 days past due and record an allowance for disputes when there is reasonable uncertainty of the collectability of a disputed amount during the reporting period. Past-due balances were not significant for any of the periods presented. For further discussion of arbitration proceedings against us, see Note 16. 9. Variable Interest Entities A VIE is a legal entity that does not have sufficient equity at risk to finance its activities without additional subordinated financial support or is structured such that equity investors lack the ability to make significant decisions relating to the entity’s operations through voting rights or do not substantively participate in the gains and losses of the entity. Consolidation of a VIE by its primary beneficiary is not based on majority voting interest but is based on other criteria discussed below. We enter into various arrangements with VIEs in the normal course of business and consolidate the VIEs when we determine we are the primary beneficiary. This analysis includes a review of the VIE’s capital structure, related contractual relationships and terms, nature of the VIE’s operations and purpose, nature of the VIE’s interests issued and our involvement with the entity. When assessing the need to consolidate a VIE, we evaluate the design of the VIE as well as the related risks to which the entity was designed to expose the variable interest holders. The primary beneficiary is the entity that has both (i) the power to direct the activities of the VIE that most significantly affect the entity’s economic performance and (ii) the obligation to absorb losses or the right to receive benefits that could be potentially significant to the VIE. While also considering these factors, the consolidation conclusion depends on the breadth of our decision-making ability and our ability to influence activities that significantly affect the economic performance of the VIE. Corebridge | First Quarter 2024 Form 10-Q 42 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 9. Variable Interest Entities BALANCE SHEET CLASSIFICATION AND EXPOSURE TO LOSS Creditors or beneficial interest holders of VIEs for which the Company is the primary beneficiary generally have recourse only to the assets and cash flows of the VIEs and do not have recourse to the Company. The following table presents the total assets and total liabilities associated with our variable interests in consolidated VIEs, as classified in the Condensed Consolidated Balance Sheets: (in millions) Real Estate and Investment Entities (c) Securitization and Repackaging Vehicles Total March 31, 2024 Assets: Bonds available-for-sale $ 39 $ 121 $ 160 Other bond securities 46 — 46 Equity securities 19 — 19 Mortgage and other loans receivable — 1,872 1,872 Other invested assets Alternative investments (a) 2,536 — 2,536 Investment real estate 1,413 — 1,413 Short-term investments 157 2 159 Cash 54 — 54 Accrued investment income 2 5 7 Other assets 79 10 89 Total assets (b) $ 4,345 $ 2,010 $ 6,355 Liabilities: Debt of consolidated investment entities $ 1,042 $ 1,156 $ 2,198 Other liabilities 71 33 104 Total liabilities $ 1,113 $ 1,189 $ 2,302 December 31, 2023 Assets: Bonds available-for-sale $ 36 $ 76 $ 112 Other bond securities 45 — 45 Equity securities 8 — 8 Mortgage and other loans receivable — 1,941 1,941 Other invested assets Alternative investments (a) 2,695 — 2,695 Investment real estate 1,488 — 1,488 Short-term investments 125 5 130 Cash 61 — 61 Accrued investment income 2 5 7 Other assets 93 2 95 Total assets (b) $ 4,553 $ 2,029 $ 6,582 Liabilities: Debt of consolidated investment entities $ 1,117 $ 1,149 $ 2,266 Other liabilities 82 1 83 Total liabilities $ 1,199 $ 1,150 $ 2,349 (a) Composed primarily of investments in real estate joint ventures at March 31, 2024 and December 31, 2023. (b) The assets of each VIE can be used only to settle specific obligations of that VIE. (c) Off-balance-sheet exposure primarily consisting of commitments by insurance operations and affiliates into real estate and investment entities. At March 31, 2024 and December 31, 2023, together, the Company and AIG affiliates have commitments to internal parties of $ 1.7 billion and $ 1.8 billion and commitments to external parties of $ 0.5 billion and $ 0.4 billion, respectively. At March 31, 2024, $ 1.1 billion out of the internal commitments was from subsidiaries of Corebridge entities and $ 0.6 billion was from other AIG affiliates. At December 31, 2023, $ 1.2 billion out of the internal commitments was from subsidiaries of Corebridge entities, and $ 0.6 billion was from other AIG affiliates. Corebridge | First Quarter 2024 Form 10-Q 43 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 9. Variable Interest Entities The following table presents the revenue, net income (loss) attributable to noncontrolling interests and net income (loss) attributable to Corebridge associated with our variable interests in consolidated VIEs, as classified in the Condensed Consolidated Statements of Income (Loss): Real Estate and Securitization Investment and Repackaging (in millions) Entities Vehicles Total Three Months Ended March 31, 2024 Total revenue $ ( 63 ) $ 16 $ ( 47 ) Net income attributable to noncontrolling interests $ ( 51 ) $ — $ ( 51 ) Net income (loss) attributable to Corebridge $ ( 32 ) $ 9 $ ( 23 ) Three Months Ended March 31, 2023 Total revenue $ 53 $ 59 $ 112 Net income attributable to noncontrolling interests $ 6 $ — $ 6 Net income (loss) attributable to Corebridge $ 33 $ 45 $ 78 We calculate our maximum exposure to loss to be (i) the amount invested in the debt or equity of the VIE, (ii) the notional amount of VIE assets or liabilities where we have also provided credit protection to the VIE with the VIE as the referenced obligation and (iii) other commitments and guarantees to the VIE. The following table presents total assets of unconsolidated VIEs in which we hold a variable interest, as well as our maximum exposure to loss associated with these VIEs: Maximum Exposure to Loss (in millions) Total VIE Assets On-Balance Sheet (b) Off-Balance Sheet (c) Total March 31, 2024 Real estate and investment entities (a) $ 415,594 $ 5,573 $ 2,740 $ 8,313 Total $ 415,594 $ 5,573 $ 2,740 $ 8,313 December 31, 2023 Real estate and investment entities (a) $ 398,978 $ 5,532 $ 2,870 $ 8,402 Total $ 398,978 $ 5,532 $ 2,870 $ 8,402 (a) Composed primarily of hedge funds and private equity funds. (b) At March 31, 2024 and December 31, 2023, $ 5.5 billion and $ 5.5 billion, respectively, of our total unconsolidated VIE assets were recorded as other invested assets. (c) These amounts represent our unfunded commitments to invest in private equity funds and hedge funds. Additionally, from time to time, AIG designed internal securitizations and a series of VIEs, which are not consolidated by Corebridge, that securitized certain secured loans, bank loans and residential mortgage loans. The notes held by Corebridge and their related fair values are included in the available-for-sale disclosures that are reported in Notes 5 and 6. As of March 31, 2024, the total VIE assets of these securitizations are $ 3.0 billion, of which Corebridge’s maximum exposure to loss including unfunded commitments is $ 2.2 billion. As of December 31, 2023, the total VIE assets of these securitizations are $ 3.1 billion, of which Corebridge’s maximum exposure to loss is $ 2.2 billion . 10. Derivatives and Hedge Accounting We use derivatives and other financial instruments as part of our financial risk management programs and as part of our investment operations. Interest rate derivatives (such as interest rate futures, swaps and options), equity derivatives (such as equity futures, swaps and options) and fixed maturity securities are used to economically mitigate interest rate risk, equity risk and credit spread exposure associated with MRBs and embedded derivatives contained in insurance contract liabilities. Interest rate derivatives are used to manage interest rate risk associated with fixed maturity securities as well as other interest rate sensitive assets and liabilities. Equity derivatives are used to economically mitigate financial risk associated with embedded derivatives and MRBs in certain insurance liabilities. In addition, equity derivatives are used to economically hedge certain investments. Foreign exchange derivatives (principally foreign exchange forwards and swaps) are used to economically mitigate risk associated with foreign denominated investments, net capital exposures and foreign currency transactions. We use credit derivatives to manage our credit exposures. The derivatives are effective economic hedges of the exposures that they are meant to offset. As part of our strategy to enhance investment income, in addition to hedging activities, we also enter into derivative contracts with respect to investment operations, which may include, among other things, credit default swaps (CDSs), total return swaps and purchases of investments with embedded derivatives, such as equity-linked notes and convertible bonds. Corebridge | First Quarter 2024 Form 10-Q 44 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10. Derivatives and Hedge Accounting Interest rate, currency and equity swaps, credit contracts, swaptions, options and forward transactions are accounted for as derivatives, recorded on a trade-date basis and carried at fair value. Unrealized gains and losses are generally reflected in income, except in certain situations in which hedge accounting is applied and unrealized gains and losses are reflected in AOCI. Aggregate asset or liability positions are netted on the Condensed Consolidated Balance Sheets only to the extent permitted by qualifying master netting arrangements in place with each respective counterparty. Cash collateral posted with counterparties in conjunction with transactions supported by qualifying master netting arrangements is reported as a reduction of the corresponding net derivative liability, while cash collateral received in conjunction with transactions supported by qualifying master netting arrangements is reported as a reduction of the corresponding net derivative asset. Derivatives, with the exception of embedded derivatives, are reported at fair value in the Condensed Consolidated Balance Sheets in Other assets and Other liabilities. Embedded derivatives are generally presented with the host contract in the Condensed Consolidated Balance Sheets. A bifurcated embedded derivative is measured at fair value and accounted for in the same manner as a freestanding derivative contract. The corresponding host contract is accounted for according to the accounting guidance applicable for that instrument. For additional information on embedded derivatives and MRBs, see Notes 5, 14 and 15. The following table presents the notional amounts of our derivatives and the fair value of derivative assets and liabilities in the Condensed Consolidated Balance Sheets: March 31, 2024 December 31, 2023 Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities (in millions) Notional Amount Fair Value Notional Amount Fair Value Notional Amount Fair Value Notional Amount Fair Value Derivatives designated as hedging instruments: (a) Interest rate contracts $ 696 $ 210 $ 3,149 $ 64 $ 2,213 $ 238 $ 833 $ 18 Foreign exchange contracts 5,822 400 1,019 58 2,918 354 4,829 164 Derivatives not designated as hedging instruments: (a) Interest rate contracts 51,805 2,975 34,607 2,993 41,056 2,709 41,225 3,260 Foreign exchange contracts 11,337 599 4,220 259 6,260 586 7,878 399 Equity contracts 76,330 2,876 14,588 1,228 76,561 2,017 14,144 745 Credit contracts (b) 2,005 78 5 — 305 8 5 — Other contracts (c) 43,182 13 47 1 44,640 13 47 2 Total derivatives, gross $ 191,177 $ 7,151 $ 57,635 $ 4,603 $ 173,953 $ 5,925 $ 68,961 $ 4,588 Counterparty netting (d) ( 4,279 ) ( 4,279 ) ( 3,646 ) ( 3,646 ) Cash collateral (e) ( 2,381 ) ( 166 ) ( 1,886 ) ( 801 ) Total derivatives on Condensed Consolidated Balance Sheets (f) $ 491 $ 158 $ 393 $ 141 (a) Fair value amounts are shown before the effects of counterparty netting adjustments and offsetting cash collateral. (b) Includes written credit default swaps linked to certain actively traded indices. In the case of a credit event, the maximum future payment is limited to the constituent’s representation within the index. (c) Consists primarily of stable value wraps and contracts with multiple underlying exposures. (d) Represents netting of derivative exposures covered by a qualifying master netting agreement. (e) Represents cash collateral posted and received that is eligible for netting. (f) Fr eestanding derivatives only, excludes embedded derivatives. Derivative instrument assets and liabilities are recorded in Other assets and Other liabilities, respectively. The fair value of assets related to bifurcated embedded derivatives were both zero at March 31, 2024 and December 31, 2023. The fair value of liabilities related to bifurcated embedded derivatives was $ 10.9 billion and $ 10.2 billion at March 31, 2024 and December 31, 2023, respectively. A bifurcated embedded derivative is generally presented with the host contract in the Condensed Consolidated Balance Sheets. Embedded derivatives are primarily related to guarantee features in fixed index annuities, index universal life contracts and bonds available-for-sale, which include equity and interest rate components and the funds withheld arrangement with Fortitude Re. For additional information, see Note 8. Corebridge | First Quarter 2024 Form 10-Q 45 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10. Derivatives and Hedge Accounting The following table presents the gross notional amounts of our derivatives and the fair value of derivative assets and liabilities with related parties and third parties: March 31, 2024 December 31, 2023 Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities (in millions) Notional Amount Fair Value Notional Amount Fair Value Notional Amount Fair Value Notional Amount Fair Value Total derivatives with related parties $ 8,038 $ 215 $ 1 $ — $ 53,163 $ 622 $ 5,720 $ 232 Total derivatives with third parties 183,139 6,936 57,634 4,603 120,790 5,303 63,241 4,356 Total derivatives, gross $ 191,177 $ 7,151 $ 57,635 $ 4,603 $ 173,953 $ 5,925 $ 68,961 $ 4,588 As of March 31, 2024 and December 31, 2023, the following amounts were recorded on the Condensed Consolidated Balance Sheets related to the carrying amount of the hedged assets (liabilities) and cumulative basis adjustments included in the carrying amount for fair value hedges: March 31, 2024 December 31, 2023 (in millions) Carrying Amount of the Hedged Assets (Liabilities) Cumulative Amount of Fair Value Hedging Adjustments Included In the Carrying Amount of the Hedged Assets Liabilities Carrying Amount of the Hedged Assets (Liabilities) Cumulative Amount of Fair Value Hedging Adjustments Included In the Carrying Amount of the Hedged Assets Liabilities Balance sheet line item in which hedged item is recorded: Fixed maturities, available-for-sale, at fair value $ 6,312 $ — $ 7,412 $ — Commercial mortgage and other loans (a) — ( 23 ) — ( 24 ) Policyholder contract deposits (b) ( 5,244 ) 84 ( 4,756 ) ( 31 ) (a) This relates to hedge accounting that has been discontinued, but the respective loans are still held. The cumulative adjustment is being amortized into earnings over the remaining life of the loan. (b) This relates to fair value hedges on GICs. COLLATERAL We engage in derivative transactions that are not subject to a clearing requirement directly with related parties and unaffiliated third parties, in most cases under International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreements. Many of the ISDA Master Agreements also include Credit Support Annex provisions, which provide for collateral postings that may vary based on criteria such as ratings and threshold levels. We attempt to reduce our risk with certain counterparties by entering into agreements that enable collateral to be obtained from a counterparty on an up-front or contingent basis. We minimize the risk that counterparties might be unable to fulfill their contractual obligations by monitoring counterparty credit exposure and collateral value and generally requiring additional collateral to be posted upon the occurrence of certain events or circumstances. Collateral posted by us to third parties for derivative transactions was $ 1.0 billion and $ 1.4 billion at March 31, 2024 and December 31, 2023, respectively. No collateral was posted by us to related parties for derivative transactions at March 31, 2024 and December 31, 2023, respectively. In the case of collateral posted under derivative transactions that are not subject to clearing, this collateral can generally be repledged or resold by the counterparties. Collateral provided to us from third parties for derivative transactions was $ 2.6 billion and $ 1.9 billion at March 31, 2024 and December 31, 2023, respectively. Collateral provided to us from related parties for derivative transactions was $ 220 million and $ 377 million at March 31, 2024 and December 31, 2023, respectively. In the case of collateral provided to us under derivative transactions that are not subject to clearing, we generally can repledge or resell collateral. OFFSETTING We have elected to present all derivative receivables and derivative payables, and the related cash collateral received and paid, on a net basis on our Condensed Consolidated Balance Sheets when a legally enforceable ISDA Master Agreement exists between us and our derivative counterparty. An ISDA Master Agreement is an agreement governing multiple derivative transactions between two counterparties. The ISDA Master Agreement generally provides for the net settlement of all, or a specified group, of these derivative transactions, as well as transferred collateral, through a single payment, and in a single currency, as applicable. The net settlement provisions apply in the event of a default on, or affecting any, one derivative transaction or a termination event affecting all, or a specified group of, derivative transactions governed by the ISDA Master Agreement. Corebridge | First Quarter 2024 Form 10-Q 46 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10. Derivatives and Hedge Accounting HEDGE ACCOUNTING We designated certain derivatives entered into with related parties as fair value hedges of available-for-sale securities held by our insurance subsidiaries. The fair value hedges include foreign currency forwards and cross-currency swaps designated as hedges of the change in fair value of foreign currency denominated available-for-sale securities attributable to changes in foreign exchange rates. We also designated certain interest rate swaps entered into with related parties as fair value hedges of fixed rate GICs and commercial mortgage loans attributable to changes in benchmark interest rates. In 2022 we designated certain interest rate swaps entered into with related parties as cash flow hedges of forecasted coupon payments associated with anticipated long-term debt issuances. For the three months ended March 31, 2024 and 2023, $ 7 million and $ 7 million, respectively, has been reclassified into Interest expense. The remaining amount in AOCI, of $ 167 million, will be reclassified into Interest expense over the life of the hedging relationship, which can extend up to 30 years. We expect $ 28 million to be reclassified into Interest expense over the next 12 months. There are no amounts excluded from the assessment of hedge effectiveness that are recognized in earnings. For additional information related to the debt issuances, see Note 17 to the Consolidated Financial Statements in the 2023 Form 10-K. We also designated certain interest rate swaps as cash flow hedges of floating-rate investment assets. Related to such swaps, for the three months ended March 31, 2024, we recognized derivative gains (losses) of $( 18 ) million in AOCI and $( 3 ) million in net investment income. As it relates to such hedges, we do not expect any reclassifications into net investment income over the next 12 months and there are no amounts excluded from the assessment of hedge effectiveness that are recognized in earnings. We use cross-currency swaps as hedging instruments in net investment hedge relationships to mitigate the foreign exchange risk associated with our non-U.S. dollar functional currency foreign subsidiaries. For net investment hedge relationships that use derivatives as hedging instruments, we assess hedge effectiveness and measure hedge ineffectiveness using changes in forward rates. We recognized gains (losses) for the three months ended March 31, 2024 and 2023 of $ 2 million and $( 1 ) million, respectively, included in Change in foreign currency translation adjustment in OCI related to the net investment hedge relationships. The gains (losses) recognized primarily include transactions with related parties. A qualitative methodology is utilized to assess hedge effectiveness for net investment hedges, while regression analysis is employed for all other hedges. The following table presents the gain (loss) recognized in earnings on our derivative instruments in fair value hedging relationships in the Condensed Consolidated Statements of Income (Loss): Gains/(Losses) Recognized in Earnings for: (in millions) Hedging Derivatives (a)(b) Excluded Components (b)(c) Hedged Items Net Impact Three Months Ended March 31, 2024 Interest rate contracts: Interest credited to policyholder account balances $ ( 59 ) $ — $ 65 $ 6 Foreign exchange contracts: Realized gains (losses) $ 144 $ ( 11 ) $ ( 144 ) $ ( 11 ) Three Months Ended March 31, 2023 Interest rate contracts: Interest credited to policyholder account balances $ 86 $ — $ ( 88 ) $ ( 2 ) Foreign exchange contracts: Realized gains (losses) $ ( 83 ) $ 79 $ 83 $ 79 (a) Gains and losses on derivative instruments designated and qualifying in fair value hedges that are included in the assessment of hedge effectiveness. (b) Includes gains and losses with related parties for the three months ended March 31, 2024 and 2023. (c) Gains and losses on derivative instruments designated and qualifying in fair value hedges that are excluded from the assessment of hedge effectiveness and recognized in earnings on a mark-to-market basis. Corebridge | First Quarter 2024 Form 10-Q 47 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 10. Derivatives and Hedge Accounting DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS The following table presents the effect of derivative instruments not designated as hedging instruments in the Condensed Consolidated Statements of Income (Loss): Gains (Losses) Recognized in Earnings Three Months Ended March 31, (in millions) 2024 2023 By Derivative Type: Interest rate contracts $ ( 367 ) $ 32 Foreign exchange contracts 224 ( 67 ) Equity contracts 189 83 Credit contracts 23 — Other contracts 16 ( 127 ) Embedded derivatives ( 562 ) ( 384 ) Fortitude Re funds withheld embedded derivative 22 ( 1,025 ) Total (a) $ ( 455 ) $ ( 1,488 ) By Classification: Policy fees $ 15 $ 16 Net investment income - Fortitude Re funds withheld assets 5 ( 2 ) Net realized gains (losses) - excluding Fortitude Re funds withheld assets (b) 298 ( 414 ) Net realized gains (losses) on Fortitude Re funds withheld assets ( 95 ) 43 Net realized gains (losses) on Fortitude Re funds withheld embedded derivatives 22 ( 1,025 ) Policyholder benefits — 3 Change in the Fair value of market risk benefits (c) ( 700 ) ( 109 ) Total (a) $ ( 455 ) $ ( 1,488 ) (a) Includes gains (losses) with related parties of $( 13 ) million and $ 6 million for the three months ended March 31, 2024 and 2023, respectively. (b) Includes a $ 5 million gain (loss) related to the sale of AIG Life reported in Net (gain) loss on divestitures. For further details on this transaction, see Notes 1 and 4. (c) This represents activity related to derivatives that economically hedged changes in fair value of certain MRBs. In addition to embedded derivatives within policyholder contract deposits, certain guaranteed benefits within insurance contracts are classified as MRBs. The change in the fair value of these benefits is disclosed in Note 15 . The change in the fair value of MRBs and the derivative instruments that hedge those risks are recognized in “Change in the fair value of MRBs, net” in the Condensed Consolidated Statements of Income (Loss). HYBRID SECURITIES WITH EMBEDDED CREDIT DERIVATIVES We invest in hybrid securities (such as credit-linked notes) with the intent of generating income, and not specifically to acquire exposure to embedded derivative risk. As is the case with our other investments in RMBS, CMBS, CLOs, ABS and collateralized debt obligation s (“CDOs”), our investments in these hybrid securities are exposed to losses only up to the amount of our initial investment in the hybrid security. Other than our initial investment in the hybrid securities, we have no further obligation to make payments on the embedded credit derivatives in the related hybrid securities. We elect to account for our investments in these hybrid securities with embedded written credit derivatives at fair value, with changes in fair value recognized in Net investment income. Our investments in these hybrid securities are reported as Other bond securities in the Condensed Consolidated Balance Sheets. The fair values of these hybrid securities were both zero at March 31, 2024 and December 31, 2023. These securities have par amounts of $ 25 million and $ 25 million at March 31, 2024 and December 31, 2023, respectively, and have remaining stated maturity dates that extend to 2052. Corebridge | First Quarter 2024 Form 10-Q 48 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 11. Deferred Policy Acquisition Costs 11. Deferred Policy Acquisition Costs Deferred policy acquisition costs (“DAC”) represent those costs that are incremental and directly related to the successful acquisition of new or renewal of existing insurance contracts. We defer incremental costs that result directly from, and are essential to, the acquisition or renewal of an insurance contract. Such DAC generally include agent or broker commissions and bonuses, and medical fees that would not have been incurred if the insurance contract had not been acquired or renewed. Each cost is analyzed to assess whether it is fully deferrable. We partially defer costs, including certain commissions, when we do not believe that the entire cost is directly related to the acquisition or renewal of insurance contracts. Commissions that are not deferred to DAC are recorded in Non-deferrable insurance commissions in the Condensed Consolidated Statements of Income (Loss). We also defer a portion of employee total compensation and payroll-related fringe benefits directly related to time spent performing specific acquisition or renewal activities, including costs associated with the time spent on underwriting, policy issuance and processing, and sales force contract selling. The amounts deferred are derived based on successful efforts for each distribution channel and/or cost center from which the cost originates. DAC for all contracts, except for those with limited to no exposure to policyholder behavior risk, (i.e., certain investment contracts), is grouped and amortized on a constant level basis over the expected term of the related contracts. Value of Business Acquired (“VOBA”): VOBA is determined at the time of acquisition and is reported in the Condensed Consolidated Balance Sheets with DAC. This value is based on the present value of future pre-tax profits discounted at yields applicable at the time of purchase. VOBA is amortized, consistent with DAC, i.e., over the life of the business on a constant level basis. The following table presents a rollforward of deferred policy acquisition costs and value of business acquired related to long-duration contracts for the three months ended March 31, 2024 and 2023: Individual Retirement Group Retirement Life Insurance Institutional Markets Total (in millions) DAC: Balance at January 1, 2024 $ 4,777 $ 1,055 $ 4,092 $ 70 $ 9,994 Capitalization 170 22 135 13 340 Amortization expense ( 149 ) ( 21 ) ( 93 ) ( 3 ) ( 266 ) Other, including foreign exchange — — ( 7 ) — ( 7 ) Reclassified to Assets held-for-sale — — ( 27 ) — ( 27 ) Balance at March 31, 2024 $ 4,798 $ 1,056 $ 4,100 $ 80 $ 10,034 Balance at January 1, 2023 $ 4,643 $ 1,060 $ 4,718 $ 51 $ 10,472 Capitalization 187 21 107 4 319 Amortization expense ( 137 ) ( 21 ) ( 93 ) ( 2 ) ( 253 ) Other, including foreign exchange — — 13 — 13 Balance at March 31, 2023 $ 4,693 $ 1,060 $ 4,745 $ 53 $ 10,551 VOBA: Balance at January 1, 2024 $ 2 $ 1 $ 14 $ — $ 17 Amortization expense — — ( 1 ) — ( 1 ) Other, including foreign exchange — — ( 1 ) — ( 1 ) Balance at March 31, 2024 $ 2 $ 1 $ 12 $ — $ 15 Balance at January 1, 2023 $ 3 $ 1 $ 87 $ — $ 91 Amortization expense — — ( 3 ) — ( 3 ) Other, including foreign exchange ( 2 ) — 4 — 2 Balance at March 31, 2023 $ 1 $ 1 $ 88 $ — $ 90 Total DAC and VOBA: Balance at March 31, 2024 $ 10,049 Balance at March 31, 2023 $ 10,641 Corebridge | First Quarter 2024 Form 10-Q 49 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 11. Deferred Policy Acquisition Costs DEFERRED SALES INDUCEMENTS We offer deferred sales inducements (“DSI”) which include enhanced crediting rates or bonus payments to contract holders (bonus interest) on certain annuity and investment contract products. To qualify for accounting treatment as an asset, the bonus interest must be explicitly identified in the contract at inception. We must also demonstrate that such amounts are incremental to amounts we credit on similar contracts without bonus interest and are higher than the contracts’ expected ongoing crediting rates for periods after the bonus period. DSI is reported in Other assets, while amortization related to DSI is recorded in Interest credited to policyholder account balances. DSI amounts are deferred and amortized on a constant level basis over the life of the contract consistent with DAC. The following table presents a rollforward of deferred sales inducement assets related to long-duration contracts for the three months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 2023 Individual Retirement Group Retirement Total Individual Retirement Group Retirement Total (in millions) Balance, beginning of year $ 333 $ 164 $ 497 $ 381 $ 177 $ 558 Capitalization 1 — 1 2 — 2 Amortization expense ( 13 ) ( 3 ) ( 16 ) ( 14 ) ( 3 ) ( 17 ) Balance, end of period $ 321 $ 161 $ 482 $ 369 $ 174 $ 543 Other reconciling items* 1,660 2,145 Other assets, including restricted cash $ 2,142 $ 2,688 * Other reconciling items include prepaid expenses, goodwill, intangible assets and any similar items. 12. Separate Account Assets and Liabilities We report variable contracts within the separate accounts when investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contract holder and the separate account meets additional accounting criteria to qualify for separate account treatment. The assets supporting the variable portion of variable annuity and variable universal life contracts that qualify for separate account treatment are carried at fair value and are reported as separate account assets, with an equivalent summary total reported as separate account liabilities. The assets of insulated accounts are legally segregated and are not subject to claims that arise from any of our other businesses. Policy values for variable products and investment contracts are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio. The current liability at any time is the sum of the current unit value of all investment units in the separate accounts, plus any liabilities for MRBs. Amounts assessed against the policyholders for mortality, administrative and other services are included in policy fees. Investment performance (including investment income, net investment gains (losses) and changes in unrealized gains (losses)) and the corresponding amounts credited to policyholders of such separate accounts are offset within the same line in the Condensed Consolidated Statements of Income (Loss). For discussion of the fair value measurement of guaranteed benefits that are accounted for as MRBs, see Note 5. The following table presents fair value of separate account investment options: Individual Retirement Group Retirement Life Insurance Institutional Markets Total (in millions) March 31, 2024 Equity funds $ 26,945 $ 30,285 $ 900 $ 635 $ 58,765 Bond funds 4,121 3,315 45 1,281 8,762 Balanced funds 18,179 5,663 55 2,062 25,959 Money market funds 693 802 16 176 1,687 Total $ 49,938 $ 40,065 $ 1,016 $ 4,154 $ 95,173 December 31, 2023 Equity funds $ 25,451 $ 28,675 $ 819 $ 593 $ 55,538 Bond funds 4,037 3,292 44 1,303 8,676 Balanced funds 17,711 5,479 53 1,923 25,166 Money market funds 694 742 16 173 1,625 Total $ 47,893 $ 38,188 $ 932 $ 3,992 $ 91,005 Corebridge | First Quarter 2024 Form 10-Q 50 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 12. Separate Account Assets and Liabilities The following table presents the balances and changes in separate account liabilities: Three Months Ended March 31, 2024 Individual Retirement Group Retirement Life Insurance Institutional Markets Total (in millions) Separate accounts balance, beginning of year $ 47,893 $ 38,188 $ 932 $ 3,992 $ 91,005 Premiums and deposits 294 340 9 69 712 Policy charges ( 288 ) ( 115 ) ( 12 ) ( 24 ) ( 439 ) Surrenders and withdrawals ( 1,193 ) ( 1,052 ) ( 9 ) ( 31 ) ( 2,285 ) Benefit payments ( 239 ) ( 154 ) ( 2 ) ( 5 ) ( 400 ) Investment performance 3,451 2,934 98 139 6,622 Net transfers from (to) general account and other 20 ( 76 ) — 14 ( 42 ) Separate accounts balance, end of period $ 49,938 $ 40,065 $ 1,016 $ 4,154 $ 95,173 Cash surrender value * $ 48,975 $ 39,865 $ 995 $ 4,150 $ 93,985 Three Months Ended March 31, 2023 Separate accounts balance, beginning of year $ 45,178 $ 34,361 $ 799 $ 4,515 $ 84,853 Premiums and deposits 451 360 9 26 846 Policy charges ( 344 ) ( 110 ) ( 12 ) ( 24 ) ( 490 ) Surrenders and withdrawals ( 844 ) ( 669 ) ( 6 ) ( 404 ) ( 1,923 ) Benefit payments ( 215 ) ( 130 ) ( 1 ) ( 54 ) ( 400 ) Investment performance 2,131 2,186 53 99 4,469 Net transfers from (to) general account and other 73 ( 78 ) ( 1 ) 8 2 Separate accounts balance, end of period $ 46,430 $ 35,920 $ 841 $ 4,166 $ 87,357 Cash surrender value * $ 45,388 $ 35,726 $ 794 $ 4,168 $ 86,076 * The cash surrender value represents the amount of the contract holder’s account balance distributable at the balance sheet date less applicable surrender charges. Separate account liabilities primarily represent the contract holder's account balance in separate account assets and will be equal and offsetting to total separate account assets. 13. Future Policy Benefits Future policy benefits primarily include reserves for traditional life and annuity payout contracts, which represent an estimate of the present value of future benefits less the present value of future net premiums. Included in Future policy benefits are liabilities for annuities issued in structured settlement arrangements whereby a claimant receives life contingent payments over their lifetime. Also included are pension risk transfer arrangements whereby an upfront premium is received in exchange for guaranteed retirement benefits. All payments under these arrangements are fixed and determinable with respect to their amounts and dates. Structured settlement or other annuitization elections (e.g., certain single premium immediate annuities) that do not involve life contingent payments, but rather payments for a stated period are included in Policyholder contract deposits. For traditional and limited pay long-duration products, benefit reserves are accrued and benefit expense is recognized using a net premium ratio (“NPR”) methodology for each annual cohort of business. Corebridge | First Quarter 2024 Form 10-Q 51 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 13. Future Policy Benefits The following tables present the balances and changes in the liability for future policy benefits and a reconciliation of the net liability for future policy benefits to the liability for future policy benefits in the Condensed Consolidated Balance Sheets: Three Months Ended March 31, 2024 Individual Retirement Group Retirement Life Insurance Institutional Markets Corporate and Other Total (in millions, except for liability durations) Present value of expected net premiums Balance, beginning of year $ — $ — $ 8,379 $ — $ 973 $ 9,352 Effect of changes in discount rate assumptions (AOCI) — — 1,482 — 44 1,526 Reclassified to Liabilities held-for-sale — — 4,287 — — 4,287 Beginning balance at original discount rate — — 14,148 — 1,017 15,165 Effect of actual variances from expected experience — — ( 13 ) — — ( 13 ) Adjusted beginning of year balance — — 14,135 — 1,017 15,152 Issuances — — 353 — — 353 Interest accrual — — 117 — 11 128 Net premium collected — — ( 381 ) — ( 29 ) ( 410 ) Foreign exchange impact — — ( 46 ) — — ( 46 ) Other — — ( 4 ) — — ( 4 ) Ending balance at original discount rate — — 14,174 — 999 15,173 Effect of changes in discount rate assumptions (AOCI) — — ( 1,621 ) — ( 57 ) ( 1,678 ) Reclassified to Liabilities held-for-sale — — ( 4,247 ) — — ( 4,247 ) Balance, end of period $ — $ — $ 8,306 $ — $ 942 $ 9,248 Present value of expected future policy benefits Balance, beginning of year $ 1,353 $ 217 $ 17,531 $ 18,482 $ 20,654 $ 58,237 Effect of changes in discount rate assumptions (AOCI) 132 ( 3 ) 2,745 1,906 437 5,217 Reclassified to Liabilities held-for-sale — — 5,119 — — 5,119 Beginning balance at original discount rate 1,485 214 25,395 20,388 21,091 68,573 Effect of actual variances from expected experience (a) ( 6 ) ( 1 ) ( 7 ) — ( 9 ) ( 23 ) Adjusted beginning of year balance 1,479 213 25,388 20,388 21,082 68,550 Issuances 34 5 350 1,726 2 2,117 Interest accrual 16 3 236 217 252 724 Benefit payments ( 33 ) ( 7 ) ( 458 ) ( 283 ) ( 370 ) ( 1,151 ) Foreign exchange impact — — ( 61 ) ( 82 ) — ( 143 ) Other — — ( 3 ) — ( 3 ) ( 6 ) Ending balance at original discount rate 1,496 214 25,452 21,966 20,963 70,091 Effect of changes in discount rate assumptions (AOCI) ( 153 ) — ( 3,149 ) ( 2,347 ) ( 959 ) ( 6,608 ) Reclassified to Liabilities held-for-sale — — ( 5,078 ) — — ( 5,078 ) Balance, end of period $ 1,343 $ 214 $ 17,225 $ 19,619 $ 20,004 $ 58,405 Net liability for future policy benefits, end of period 1,343 214 8,919 19,619 19,062 49,157 Liability for future policy benefits for certain participating contracts — — 13 — 1,289 1,302 Liability for universal life policies with secondary guarantees and similar features (b) — — 3,917 — 55 3,972 Deferred profit liability 78 9 20 1,595 850 2,552 Other reconciling items (c) 31 — 477 — 96 604 Future policy benefits for life and accident and health insurance contracts 1,452 223 13,346 21,214 21,352 57,587 Less: Reinsurance recoverable: ( 4 ) — ( 714 ) ( 37 ) ( 21,352 ) ( 22,107 ) Net liability for future policy benefits after reinsurance recoverable $ 1,448 $ 223 $ 12,632 $ 21,177 $ — $ 35,480 Weighted average liability duration of the liability for future policy benefits (d)(e) 7.7 6.7 12.6 12.2 11.2 Corebridge | First Quarter 2024 Form 10-Q 52 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 13. Future Policy Benefits Three Months Ended March 31, 2023 Individual Retirement Group Retirement Life Insurance Institutional Markets Corporate and Other Total (in millions, except for liability durations) Present value of expected net premiums Balance, beginning of year $ — $ — $ 11,654 $ — $ 991 $ 12,645 Effect of changes in discount rate assumptions (AOCI) — — 1,872 — 66 1,938 Beginning balance at original discount rate — — 13,526 — 1,057 14,583 Effect of actual variances from expected experience 1 — 12 — 3 16 Adjusted beginning of year balance 1 — 13,538 — 1,060 14,599 Issuances 6 — 322 — — 328 Interest accrual — — 106 — 12 118 Net premium collected ( 7 ) — ( 352 ) — ( 30 ) ( 389 ) Foreign exchange impact — — 96 — — 96 Other — — 3 — — 3 Ending balance at original discount rate — — 13,713 — 1,042 14,755 Effect of changes in discount rate assumptions (AOCI) — — ( 1,648 ) — ( 48 ) ( 1,696 ) Balance, end of period $ — $ — $ 12,065 $ — $ 994 $ 13,059 Present value of expected future policy benefits Balance, beginning of year $ 1,223 $ 211 $ 21,179 $ 12,464 $ 20,429 $ 55,506 Effect of changes in discount rate assumptions (AOCI) 167 2 3,424 2,634 1,083 7,310 Beginning balance at original discount rate 1,390 213 24,603 15,098 21,512 62,816 Effect of actual variances from expected experience (a) ( 3 ) ( 1 ) 26 ( 5 ) — 17 Adjusted beginning of year balance 1,387 212 24,629 15,093 21,512 62,833 Issuances 70 2 318 1,450 3 1,843 Interest accrual 12 3 224 139 257 635 Benefit payments ( 32 ) ( 7 ) ( 476 ) ( 228 ) ( 379 ) ( 1,122 ) Foreign exchange impact — — 277 125 — 402 Other — — 1 — ( 3 ) ( 2 ) Ending balance at original discount rate 1,437 210 24,973 16,579 21,390 64,589 Effect of changes in discount rate assumptions (AOCI) ( 141 ) 3 ( 3,081 ) ( 2,302 ) ( 492 ) ( 6,013 ) Balance, end of period $ 1,296 $ 213 $ 21,892 $ 14,277 $ 20,898 $ 58,576 Net liability for future policy benefits, end of period 1,296 213 9,827 14,277 19,904 45,517 Liability for future policy benefits for certain participating contracts — — 14 — 1,326 1,340 Liability for universal life policies with secondary guarantees and similar features (b) — — 3,457 — 55 3,512 Deferred profit liability 83 10 16 1,415 871 2,395 Other reconciling items (c) 39 3 493 — 107 642 Future policy benefits for life and accident and health insurance contracts 1,418 226 13,807 15,692 22,263 53,406 Less: Reinsurance recoverable: ( 4 ) — ( 1,187 ) ( 37 ) ( 22,263 ) ( 23,491 ) Net liability for future policy benefits after reinsurance recoverable $ 1,414 $ 226 $ 12,620 $ 15,655 $ — $ 29,915 Weighted average liability duration of the liability for future policy benefits (d) 7.7 7.1 12.4 11.5 11.6 (a) Effect of changes in cash flow assumptions and variances from actual experience are partially offset by changes in the deferred profit liability. (b) Additional details can be found in the table that presents the balances and changes in the liability for universal life policies with secondary guarantees and similar features. (c) Other reconciling items primarily include the Accident and Health as well as Group Benefits (short-duration) contracts. (d) The weighted average liability durations are calculated as the modified duration using projected future net liability cashflows that are aggregated at the segment level, utilizing the segment level weighted average interest rates and current discount rate, which can be found in the table below. (e) Includes balances that were reclassified to Liabilities held-for-sale in the Condensed Consolidated Balance Sheets. See Note 4 for additional information. Corebridge | First Quarter 2024 Form 10-Q 53 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 13. Future Policy Benefits For the three months ended March 31, 2024 and 2023 in the traditional and term life insurance block, capping of net premium ratios at 100% caused a (credit)/charge to net income of $( 1 ) million and $ 25 million, respectively. The discount rate was updated based on market observable information. Relative to the prior period, the increase in upper-medium-grade fixed income yields resulted in a decrease in the liability for future policy benefits. The following table presents the amount of undiscounted expected future benefit payments and undiscounted and discounted expected gross premiums for future policy benefits for nonparticipating contracts: Three Months Ended March 31, (in millions) 2024 2023 Individual Retirement Undiscounted expected future benefits and expense $ 2,156 $ 2,048 Undiscounted expected future gross premiums $ — $ — Group Retirement Undiscounted expected future benefits and expense $ 309 $ 317 Undiscounted expected future gross premiums $ — $ — Life Insurance (a) (b) Undiscounted expected future benefits and expense $ 40,741 $ 39,028 Undiscounted expected future gross premiums $ 30,656 $ 28,964 Institutional Markets Undiscounted expected future benefits and expense $ 42,519 $ 29,029 Undiscounted expected future gross premiums $ — $ — Corporate and other (c)(d) Undiscounted expected future benefits and expense $ 42,701 $ 44,148 Undiscounted expected future gross premiums $ 2,106 $ 2,225 (a) Includes balances that have been reclassified to Liabilities held-for-sale in the Condensed Consolidated Balance Sheets. See Note 4 for additional information. (b) Life insurance discounted expected future gross premiums (at current discount rate) for three months ended March 31, 2024 were $ 20.0 billion. (c) Corporate and other discounted expected future gross premiums (at current discount rate) for three months ended March 31, 2024 were $ 1.4 billion (d) Represents activity ceded to Fortitude Re. The following table presents the amount of revenue and interest recognized in the Condensed Consolidated Statements of Income (Loss) for future policy benefits for nonparticipating contracts: Gross Premiums Interest Accretion Three Months Ended March 31, Three Months Ended March 31, (in millions) 2024 2023 2024 2023 Individual Retirement $ 39 $ 75 $ 16 $ 12 Group Retirement 5 6 3 3 Life Insurance 618 575 119 118 Institutional Markets 1,805 1,581 217 139 Corporate and Other 52 54 241 245 Total $ 2,519 $ 2,291 $ 596 $ 517 The following table presents the weighted-average interest rate for future policy benefits for nonparticipating contracts: Individual Retirement Group Retirement Life Insurance Institutional Markets Corporate and Other March 31, 2024 Weighted-average interest rate, original discount rate * 3.79 % 5.13 % 4.12 % 4.25 % 4.86 % Weighted-average interest rate, current discount rate * 5.27 % 5.24 % 5.28 % 5.19 % 5.32 % March 31, 2023 Weighted-average interest rate, original discount rate 3.65 % 5.19 % 4.11 % 3.76 % 4.88 % Weighted-average interest rate, current discount rate 5.33 % 4.91 % 5.08 % 5.04 % 5.10 % * Weighted-average interest rates for Life Insurance include balances that have been reclassified to Liabilities held-for-sale. The weighted average interest rates are calculated using projected future net liability cash flows that are aggregated to the segment level, and are represented as an annual rate. Corebridge | First Quarter 2024 Form 10-Q 54 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 13. Future Policy Benefits Additional Liabilities: For universal-life type products, insurance benefits in excess of the account balance are generally recognized as expenses in the period incurred unless the design of the product is such that future charges are insufficient to cover the benefits, in which case an “additional liability” is accrued over the life of the contract. These additional liabilities are included in Future policy benefits for life and accident and health insurance contracts in the Condensed Consolidated Balance Sheets. Our additional liabilities primarily consist of universal life policies with secondary guarantees and these additional liabilities are recognized in addition to the Policyholder account balances. For universal life policies with secondary guarantees, as well as other universal life policies for which profits followed by losses are expected at contract inception, a liability is recognized based on a benefit ratio of (a) the present value of total expected payments, in excess of the account value, over the life of the contract, divided by (b) the present value of total expected assessments over the life of the contract. For universal life policies without secondary guarantees, for which profits followed by losses are first expected after contract inception, we establish a liability, in addition to policyholder account balances, so that expected future losses are recognized in proportion to the emergence of profits in the earlier (profitable) years. Universal life account balances are reported within Policyholder contract deposits, while these additional liabilities are reported within the liability for future policy benefits in the Condensed Consolidated Balance Sheets. These additional liabilities are also adjusted to reflect the effect of unrealized gains or losses on fixed maturity securities available-for-sale on accumulated assessments, with related changes recognized through Other comprehensive income. The policyholder behavior assumptions for these liabilities include mortality, lapses and premium persistency. The capital market assumptions used for the liability for universal life secondary guarantees include discount rates and net earned rates. The following table presents the balances and changes in the liability for universal life policies with secondary guarantees and similar features: Three Months Ended March 31, 2024 2023 Life Insurance Corporate and Other Total Life Insurance Corporate and Other Total (in millions, except duration of liability) Balance, beginning of year $ 3,731 $ 55 $ 3,786 $ 3,300 $ 55 $ 3,355 Effect of changes in experience 109 ( 1 ) 108 74 ( 1 ) 73 Adjusted beginning balance $ 3,840 $ 54 $ 3,894 $ 3,374 $ 54 $ 3,428 Assessments 145 — 145 179 — 179 Excess benefits paid ( 232 ) — ( 232 ) ( 238 ) — ( 238 ) Interest accrual 38 1 39 28 1 29 Other — — — ( 5 ) — ( 5 ) Changes related to unrealized appreciation (depreciation) of investments 126 — 126 119 — 119 Balance, end of period $ 3,917 $ 55 $ 3,972 $ 3,457 $ 55 $ 3,512 Less: Reinsurance recoverable ( 172 ) ( 55 ) ( 227 ) ( 192 ) — ( 192 ) Balance, end of period, net of Reinsurance recoverable $ 3,745 $ — $ 3,745 $ 3,265 $ 55 $ 3,320 Weighted average duration of liability * 25.3 9.1 26.4 9.4 * The weighted average duration of liabilities is calculated as the modified duration using projected future net liability cashflows that are aggregated at the segment level, utilizing the segment level weighted average interest rates, which can be found in the table below. The following table presents the amount of revenue and interest recognized in the Condensed Consolidated Statements of Income (Loss) for the liability for universal life policies with secondary guarantees and similar features: Gross Assessments Three Months Ended March 31, Interest Accretion Three Months Ended March 31, (in millions) 2024 2023 2024 2023 Life Insurance $ 248 $ 299 $ 38 $ 28 Corporate and Other 10 10 1 1 Total $ 258 $ 309 $ 39 $ 29 Corebridge | First Quarter 2024 Form 10-Q 55 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 13. Future Policy Benefits The following table presents the calculation of weighted average interest rate for the liability for universal life policies with secondary guarantees and similar features: March 31, 2024 2023 Life Insurance Corporate and Other Life Insurance Corporate and Other Weighted-average interest rate 3.92 % 4.20 % 3.76 % 4.24 % The weighted average interest rates are calculated using projected future net liability cash flows that are aggregated to the segment level, and are represented as an annual rate. The following table presents details concerning our universal life policies with secondary guarantees and similar features: Three Months Ended March 31, (in millions, except for attained age of contract holders) 2024 2023 Account value $ 3,773 $ 3,556 Net amount at risk $ 73,092 $ 70,014 Average attained age of contract holders 53 53 14. Policyholder Contract Deposits and Other Policyholder Funds POLICYHOLDER CONTRACT DEPOSITS The liability for Policyholder contract deposits is primarily recorded at accumulated value (deposits received and net transfers from separate accounts, plus accrued interest credited, less withdrawals and assessed fees). Deposits collected on investment-oriented products are not reflected as revenues. They are recorded directly to Policyholder contract deposits upon receipt. Amounts assessed against the contract holders for mortality, administrative, and other services are included as Policy fees in revenues. In addition to liabilities for universal life, fixed annuities, fixed options within variable annuities, annuities without life contingencies, funding agreements and GICs, policyholder contract deposits also include our liability for (i) index features accounted for as embedded derivatives at fair value, (ii) annuities issued in a structured settlement arrangement with no life contingency and (iii) certain contracts we have elected to account for at fair value. Changes in the fair value of the embedded derivatives related to policy index features and the fair value of derivatives hedging these liabilities are recognized in realized gains and losses. For additional information on index credits accounted for as embedded derivatives, see Note 5. Under a funding agreement-backed notes issuance program, an unaffiliated, non-consolidated statutory trust issues medium-term notes to investors, which are secured by funding agreements issued to the trust by one of our subsidiaries through our Institutional Markets business. Corebridge | First Quarter 2024 Form 10-Q 56 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 14. Policyholder Contract Deposits and Other Policyholder Funds The following table presents the balances and changes in Policyholder contract deposits account balances (a) : Individual Retirement Group Retirement Life Insurance Institutional Markets Corporate and other Total (in millions, except for average crediting rate) Three Months Ended March 31, 2024 Policyholder contract deposits account balance, beginning of year $ 94,896 $ 41,299 $ 10,231 $ 13,649 $ 3,333 $ 163,408 Deposits 4,878 1,349 407 798 11 7,443 Policy charges ( 186 ) ( 122 ) ( 377 ) ( 17 ) ( 15 ) ( 717 ) Surrenders and withdrawals ( 4,600 ) ( 2,466 ) ( 73 ) ( 31 ) ( 21 ) ( 7,191 ) Benefit payments ( 761 ) ( 494 ) ( 79 ) ( 181 ) ( 79 ) ( 1,594 ) Net transfers from (to) separate account 1,248 1,024 5 ( 27 ) — 2,250 Interest credited 816 303 121 157 40 1,437 Other ( 3 ) 2 6 ( 11 ) 3 ( 3 ) Policyholder contract deposits account balance, end of period 96,288 40,895 10,241 14,337 3,272 165,033 Other reconciling items (b) ( 1,225 ) ( 192 ) 134 33 — ( 1,250 ) Policyholder contract deposits $ 95,063 $ 40,703 $ 10,375 $ 14,370 $ 3,272 $ 163,783 Weighted average crediting rate 2.86 % 3.05 % 4.39 % 4.59 % 4.98 % Cash surrender value (c) $ 89,795 $ 39,746 $ 9,042 $ 2,585 $ 1,696 $ 142,864 Three Months Ended March 31, 2023 Policyholder contract deposits account balance, beginning of year $ 89,554 $ 43,395 $ 10,224 $ 11,734 $ 3,587 $ 158,494 Deposits 4,864 1,326 414 595 11 7,210 Policy charges ( 244 ) ( 110 ) ( 384 ) ( 17 ) ( 16 ) ( 771 ) Surrenders and withdrawals ( 3,171 ) ( 2,016 ) ( 56 ) ( 403 ) ( 20 ) ( 5,666 ) Benefit payments ( 1,036 ) ( 557 ) ( 49 ) ( 167 ) ( 88 ) ( 1,897 ) Net transfers from (to) separate account 728 592 ( 1 ) 443 — 1,762 Interest credited 377 270 88 105 43 883 Other ( 2 ) 3 ( 16 ) 4 ( 1 ) ( 12 ) Policyholder contract deposits account balance, end of period 91,070 42,903 10,220 12,294 3,516 160,003 Other reconciling items (b) ( 1,889 ) ( 279 ) 116 74 — ( 1,978 ) Policyholder contract deposits $ 89,181 $ 42,624 $ 10,336 $ 12,368 $ 3,516 $ 158,025 Weighted average crediting rate 2.52 % 2.78 % 4.24 % 3.55 % 4.95 % Cash surrender value (c) $ 84,906 $ 41,361 $ 8,874 $ 2,545 $ 1,781 $ 139,467 (a) Transactions between the general account and the separate account are presented in this table on a gross basis (e.g., a policyholder's funds are initially deposited into the general account and then simultaneously transferred to the separate account), and thus, did not impact the ending balance of policyholder contract deposits. (b) Reconciling items principally relate to MRBs that are bifurcated and reported separately, net of embedded derivatives that are recorded in policyholder contract deposits. (c) Cash surrender value is related to the portion of policyholder contract deposits that have a defined cash surrender value (e.g. GICs do not have a cash surrender value). For information related to net amount at risk, refer to the table that presents the balances of and changes in MRBs in Note 15. Corebridge | First Quarter 2024 Form 10-Q 57 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 14. Policyholder Contract Deposits and Other Policyholder Funds The following table presents Policyholder contract deposits account balance 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: March 31, 2024 At Guaranteed Minimum 1 Basis Point - 50 Basis Points Above More than 50 Basis Points Above Minimum Guarantee Total (in millions, except percentage of total) Individual Retirement Range of Guaranteed Minimum Credited Rate <= 1 % $ 6,251 $ 1,917 $ 28,202 $ 36,370 > 1 % - 2 % 3,556 21 1,490 5,067 > 2 % - 3 % 7,653 11 1,407 9,071 > 3 % - 4 % 6,342 36 5 6,383 > 4 % - 5 % 424 — 4 428 > 5 % 32 — 3 35 Total $ 24,258 $ 1,985 $ 31,111 $ 57,354 Group Retirement Range of Guaranteed Minimum Credited Rate <= 1 % $ 2,133 $ 1,895 $ 7,672 $ 11,700 > 1 % - 2 % 3,597 1,126 670 5,393 > 2 % - 3 % 11,686 215 110 12,011 > 3 % - 4 % 603 — — 603 > 4 % - 5 % 6,579 — — 6,579 > 5 % 141 — — 141 Total $ 24,739 $ 3,236 $ 8,452 $ 36,427 Life Insurance Range of Guaranteed Minimum Credited Rate <= 1 % $ — $ — $ — $ — > 1 % - 2 % — 110 365 475 > 2 % - 3 % 9 1,072 856 1,937 > 3 % - 4 % 1,190 482 7 1,679 > 4 % - 5 % 2,820 — — 2,820 > 5 % 214 — — 214 Total $ 4,233 $ 1,664 $ 1,228 $ 7,125 Total* $ 53,230 $ 6,885 $ 40,791 $ 100,906 Percentage of total 53 % 7 % 40 % 100 % Corebridge | First Quarter 2024 Form 10-Q 58 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 14. Policyholder Contract Deposits and Other Policyholder Funds March 31, 2023 At Guaranteed Minimum 1 Basis Point - 50 Basis Points Above More than 50 Basis Points Above Minimum Guarantee Total (in millions, except percentage of total) Individual Retirement Range of Guaranteed Minimum Credited Rate <= 1 % $ 7,776 $ 2,562 $ 23,263 $ 33,601 > 1 % - 2 % 3,994 24 2,163 6,181 > 2 % - 3 % 9,155 1 390 9,546 > 3 % - 4 % 7,359 40 6 7,405 > 4 % - 5 % 452 — 4 456 > 5 % 32 — 4 36 Total $ 28,768 $ 2,627 $ 25,830 $ 57,225 Group Retirement Range of Guaranteed Minimum Credited Rate <= 1 % $ 2,063 $ 2,713 $ 6,049 $ 10,825 > 1 % - 2 % 5,005 908 353 6,266 > 2 % - 3 % 13,561 40 — 13,601 > 3 % - 4 % 658 — — 658 > 4 % - 5 % 6,821 — — 6,821 > 5 % 153 — — 153 Total $ 28,261 $ 3,661 $ 6,402 $ 38,324 Life Insurance Range of Guaranteed Minimum Credited Rate <= 1 % $ — $ — $ — $ — > 1 % - 2 % — 131 349 480 > 2 % - 3 % 28 862 1,079 1,969 > 3 % - 4 % 1,417 118 198 1,733 > 4 % - 5 % 2,946 — — 2,946 > 5 % 222 — — 222 Total $ 4,613 $ 1,111 $ 1,626 $ 7,350 Total* $ 61,642 $ 7,399 $ 33,858 $ 102,899 Percentage of total 60 % 7 % 33 % 100 % * Excludes policyholder contract deposits account balances that are not subject to guaranteed minimum crediting rates. OTHER POLICYHOLDER FUNDS Other policyholder funds include unearned revenue reserve (“URR”), consisting of front-end loads on investment-oriented contracts, representing those policy loads that are non-level and typically higher in initial policy years than in later policy years. Amortization of URR is recorded in Policy fees. URR for investment-oriented contracts are generally deferred and amortized into income using the same assumptions and factors used to amortize DAC (i.e., on a constant level basis). Corebridge | First Quarter 2024 Form 10-Q 59 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 14. Policyholder Contract Deposits and Other Policyholder Funds The following table presents a rollforward of the unearned revenue reserve for the three months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 Life Insurance Institutional Markets Corporate and Other Total (in millions) Balance, beginning of year $ 1,770 $ 1 $ 94 $ 1,865 Revenue deferred 40 — — 40 Amortization ( 28 ) — ( 2 ) ( 30 ) Balance, end of period $ 1,782 $ 1 $ 92 $ 1,875 Other reconciling items* 989 Other policyholder funds $ 2,864 Three Months Ended March 31, 2023 Balance, beginning of year $ 1,727 $ 2 $ 105 $ 1,834 Revenue deferred 38 — — 38 Amortization ( 27 ) ( 1 ) ( 2 ) ( 30 ) Balance, end of period $ 1,738 $ 1 $ 103 $ 1,842 Other reconciling items* 1,055 Other policyholder funds $ 2,897 * Other reconciling items include policyholders' dividend accumulations, provisions for future dividends to participating policyholders, dividends to policyholders and any similar items. 15. Market Risk Benefits MRBs are defined as contracts or contract features that both provide protection to the contract holder from other-than-nominal capital market risk and expose Corebridge to other-than nominal capital market risk. The MRB represents an amount that a policyholder receives in addition to the account balance upon the occurrence of a specific event or circumstance, such as death, annuitization, or periodic withdrawal that involves protection from other-than-nominal capital market risk. Certain contract features, such as GMWBs, GMDBs and guaranteed minimum income benefits (“GMIBs”) commonly found in variable, fixed index and fixed annuities, are MRBs. MRBs are assessed at contract inception using a non-option method involving attributed fees that results in an initial fair value of zero or an option method that results in a fair value greater than zero. MRBs are recorded at fair value, and Corebridge applies a non-option attributed fee valuation method for variable annuity products, and an option-based valuation method (host offset) for both fixed index and fixed products. Changes in the fair value of Market Risk Benefits, net represents changes in the fair value of market risk benefit liabilities and assets (with the exception of our own credit risk changes), and includes attributed rider fees and benefits, net of changes in the fair value of derivative instruments and fixed maturity securities that are used to economically hedge market risk from the variable annuity GMWB riders. Corebridge | First Quarter 2024 Form 10-Q 60 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 15. Market Risk Benefits The following table presents the balances of and changes in MRBs: Three Months Ended March 31, 2024 Individual Retirement Group Retirement Total (in millions, except for attained age of contract holders) Balance, beginning of year $ 4,562 $ 308 $ 4,870 Effect of changes in our own credit risk ( 1,072 ) ( 88 ) ( 1,160 ) Balance, beginning of year, before effect of changes in our own credit risk $ 3,490 $ 220 $ 3,710 Issuances 123 10 133 Interest accrual 45 3 48 Attributed fees 174 15 189 Expected claims ( 18 ) — ( 18 ) Effect of changes in interest rates ( 474 ) ( 38 ) ( 512 ) Effect of changes in interest rate volatility ( 14 ) — ( 14 ) Effect of changes in equity markets ( 529 ) ( 50 ) ( 579 ) Effect of changes in equity index volatility ( 15 ) — ( 15 ) Actual outcome different from model expected outcome ( 63 ) 3 ( 60 ) Effect of changes in future expected policyholder behavior — — — Effect of changes in other future expected assumptions ( 5 ) ( 1 ) ( 6 ) Other, including foreign exchange — ( 2 ) ( 2 ) Balance, end of period before effect of changes in our own credit risk 2,714 160 2,874 Effect of changes in our own credit risk 1,100 89 1,189 Balance, end of period 3,814 249 4,063 Less: Reinsured MRB, end of period ( 68 ) — ( 68 ) Net Liability Balance after reinsurance recoverable $ 3,746 $ 249 $ 3,995 Net amount at risk GMDB only $ 623 $ 136 $ 759 GMWB only $ 128 $ 12 $ 140 Combined * $ 576 $ 13 $ 589 Weighted average attained age of contract holders 71 64 Three Months Ended March 31, 2023 Balance, beginning of year $ 3,738 $ 296 $ 4,034 Effect of changes in our own credit risk ( 441 ) ( 24 ) ( 465 ) Balance, beginning of year, before effect of changes in our own credit risk $ 3,297 $ 272 $ 3,569 Issuances 191 9 200 Interest accrual 38 4 42 Attributed fees 235 17 252 Expected claims ( 25 ) ( 1 ) ( 26 ) Effect of changes in interest rates 478 46 524 Effect of changes in interest rate volatility ( 73 ) ( 4 ) ( 77 ) Effect of changes in equity markets ( 391 ) ( 36 ) ( 427 ) Effect of changes in equity index volatility 16 ( 3 ) 13 Actual outcome different from model expected outcome 72 1 73 Effect of changes in other future expected assumptions ( 94 ) ( 18 ) ( 112 ) Other, including foreign exchange 1 — 1 Balance, end of period before effect of changes in our own credit risk 3,745 287 4,032 Effect of changes in our own credit risk 339 32 371 Balance, end of period 4,084 319 4,403 Less: Reinsured MRB, end of period ( 89 ) — ( 89 ) Net liability balance after reinsurance recoverable $ 3,995 $ 319 $ 4,314 Net amount at risk GMDB only $ 1,307 $ 266 $ 1,573 GMWB only $ 63 $ 5 $ 68 Combined* $ 1,726 $ 31 $ 1,757 Weighted average attained age of contract holders 71 64 * Certain contracts contain both guaranteed GMDB and GMWB features and are modeled together for the purposes of calculating the MRB. Corebridge | First Quarter 2024 Form 10-Q 61 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 15. Market Risk Benefits The following is a reconciliation of MRBs by amounts in an asset position and in a liability position to the MRBs amount in the Condensed Consolidated Balance Sheets: March 31, 2024 March 31, 2023 (in millions) Asset* Liability* Net Asset* Liability* Net Individual Retirement $ 968 $ 4,714 $ 3,746 $ 685 $ 4,680 $ 3,995 Group Retirement 204 453 249 145 464 319 Total $ 1,172 $ 5,167 $ 3,995 $ 830 $ 5,144 $ 4,314 * Cash flows and attributed fees for MRBs are determined on a policy level basis and are reported based on their asset or liability position at the balance sheet date. For additional information related to fair value measurements of MRBs, see Note 5. 16. Contingencies, Commitments and Guarantees In the normal course of business, we enter into various contingent liabilities and commitments. Although we cannot currently quantify our ultimate liability for unresolved litigation and investigation matters, including those referred to below, it is possible that such liability could have a material adverse effect on our consolidated financial condition, consolidated results of operations or consolidated cash flows for an individual reporting period. LEGAL CONTINGENCIES Overview In the normal course of business, we are subject to regulatory and government investigations and actions, and litigation and other forms of dispute resolution in a large number of proceedings pending in various domestic and foreign jurisdictions. Certain of these matters involve potentially significant risk of loss due to potential for significant jury awards and settlements, punitive damages or other penalties. Many of these matters are also highly complex and may seek recovery on behalf of a class or similarly large number of plaintiffs. It is therefore inherently difficult to predict the size or scope of potential future losses arising from these matters. In our insurance and reinsurance operations, litigation and arbitration concerning the scope of coverage under insurance and reinsurance contracts, and litigation and arbitration in which our subsidiaries defend or indemnify their insureds under insurance contracts, are generally considered in the establishment of our future policy benefits. Separate and apart from the foregoing matters involving insurance and reinsurance coverage, we and our respective officers and directors are subject to a variety of additional types of legal proceedings brought by holders of our securities, customers, employees and others, alleging, among other things, breach of contractual or fiduciary duties, bad faith, indemnification and violations of federal and state statutes and regulations. With respect to these other categories of matters not arising out of claims for insurance or reinsurance coverage, we establish reserves for loss contingencies when it is probable that a loss will be incurred, and the amount of the loss can be reasonably estimated. In many instances, we are unable to determine whether a loss is probable or to reasonably estimate the amount of such a loss and, therefore, the potential future losses arising from legal proceedings may exceed the amount of liabilities that we have recorded in our financial statements covering these matters. While such potential future charges could be material, based on information currently known to management, management does not believe, other than as may be discussed below, that any such charges are likely to have a material adverse effect on our financial position or results of operations. Additionally, from time to time, various regulatory and governmental agencies review our transactions and practices in connection with industry-wide and other inquiries or examinations into, among other matters, the business practices of current and former operating subsidiaries. Such investigations, inquiries or examinations could develop into administrative, civil or criminal proceedings or enforcement actions, in which remedies could include fines, penalties, restitution or alterations in our business practices, and could result in additional expenses, limitations on certain business activities and reputational damage. Yearly Renewable Term Agreements Certain of our reinsurers have sought rate increases on certain YRT agreements. We are disputing the requested rate increases under these agreements. Certain reinsurers with whom we have disputes have initiated arbitration proceedings against us, may initiate additional proceedings, and other reinsurers may initiate them in the future. To the extent reinsurers have sought retroactive premium increases, we have accrued our current estimate of probable loss with respect to these matters. For additional information, see Note 8. Corebridge | First Quarter 2024 Form 10-Q 62 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 16. Contingencies, Commitments and Guarantees Moriarty Litigation AGL continues to defend against Moriarty v. American General Life Insurance Co. (S.D. Cal.), a putative class action involving Sections 10113.71 and 10113.72 of the California Insurance Code which was instituted against AGL on July 18, 2017. In general, those statutes require that for life-insurance policies issued and delivered in California: (1) the policy must contain a 60-day grace period following nonpayment of premium during which the policy remains in force; (2) the insurer must provide a 30-day pre-lapse notice; and (3) the insurer must notify policy owners of the right to designate a secondary recipient for lapse notices. The Moriarty plaintiff contends AGL did not comply with these requirements for a policy issued before these statutes went into effect. The plaintiff seeks damages and other relief. AGL asserts various defenses to the plaintiff’s claims and to class certification. In 2022, the District Court held a trial was necessary to determine whether AGL was liable, and it denied class certification. In May 2023, the case was reassigned to a new judge. On August 14, 2023, the District Court granted the plaintiff’s motion for summary judgment on the plaintiff’s breach-of-contract claim. On September 26, 2023, the District Court decided that good cause exists to allow the plaintiff to file a third motion for class certification. At the same time, however, the District Court certified its August 14, 2023 order for interlocutory appeal to the Ninth Circuit and stayed trial-court proceedings pending the outcome of AGL’s appeal. The Ninth Circuit granted AGL’s petition for interlocutory appeal on November 21, 2023, which remains pending. AGL filed its opening brief on April 15, 2024. AGL is defending other actions in California involving similar issues: Allen v. Protective Life Insurance Co. and AGL (E.D. Cal.), filed on June 6, 2022, in which the individual plaintiff filed a motion on August 11, 2023 seeking leave to amend the complaint to add class-action allegations against AGL; and Chuck v. American General Life Insurance Co. (C.D. Cal.), which was filed on September 6, 2023 as a putative class action. These cases are in the early stages, and we expect their progress will be influenced by future developments in Moriarty and cases against other insurers involving the same statutes. We have accrued our current estimate of probable loss with respect to these litigation matters. OTHER COMMITMENTS In the normal course of business, we enter into commitments to invest in limited partnerships, private equity funds and hedge funds and to purchase and develop real estate in the United States and abroad. These commitments totaled $ 4.4 billion at March 31, 2024. GUARANTEES Asset Dispositions We are subject to guarantees and indemnity arrangements in connection with the completed sales of businesses. The various arrangements may be triggered by, among other things, declines in asset values; the occurrence of specified business contingencies; the realization of contingent liabilities; developments in litigation; or breaches of representations, warranties or covenants provided by us. These arrangements are typically subject to various time limitations, defined by the contract or by operation of law, such as statutes of limitations. In some cases, the maximum potential obligation is subject to contractual limitations, while in other cases such limitations are not specified or are not applicable. We are unable to develop a reasonable estimate of the maximum potential payout under certain of these arrangements. Overall, we believe that it is unlikely we will have to make any material payments related to completed sales under these arrangements, and no material liabilities related to these arrangements have been recorded in the Condensed Consolidated Balance Sheets. Guarantees provided by AIG Prior to the IPO, AIG provided certain guarantees to us as described below. Pursuant to the Separation Agreement we entered into with AIG dated September 14, 2022 (the “Separation Agreement”), we will indemnify, defend and hold harmless AIG against or from any liability arising from or related to these guarantees. Certain of our insurance subsidiaries benefit from General Guarantee Agreements under which American Home Assurance Company (“AHAC”) or National Union Fire Insurance Company of Pittsburgh, PA (“NUFIC”) has unconditionally and irrevocably guaranteed all present and future obligations arising from certain insurance policies issued by these subsidiaries (a “Guaranteed Policy” or the “Guaranteed Policies”). AHAC and NUFIC are required to perform under the agreements if one of the insurance subsidiaries fails to make payments due under a Guaranteed Policy. These General Guarantee Agreements have all been terminated as to insurance policies issued after the date of termination. AHAC and NUFIC have not been required to perform under any of the agreements but remain contingently liable for all policyholder obligations associated with the Guaranteed Policies. We did not pay any fees under these agreements for the three months ended March 31, 2024 or 2023. Corebridge | First Quarter 2024 Form 10-Q 63 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 16. Contingencies, Commitments and Guarantees AIG Parent provides a full and unconditional guarantee of all outstanding notes and junior subordinated debentures of Corebridge Life Holdings, Inc. (“CRBGLH”). This includes: • a guarantee (the “CRBGLH External Debt Guarantee”) in connection with CRBGLH junior subordinated debentures and certain CRBGLH notes (the “CRBGLH External Debt”); and • a guarantee in connection with a sale-leaseback transaction in 2020. Pursuant to this transaction, CRBGLH issued promissory notes to AGL with maturity dates of up to five years . These promissory notes were guaranteed by AIG Parent for the benefit of AGL. We paid no fees for these guarantees during the three months ended March 31, 2024 or 2023. On August 1, 2023, the guarantee of these promissory notes was novated from AIG Parent to Corebridge Parent. In addition to the Separation Agreement, we have entered into a guarantee reimbursement agreement with AIG Parent which provides that we will reimburse AIG Parent for the full amount of any payment made by or on behalf of AIG Parent pursuant to the CRBGLH External Debt Guarantee. We have also entered into a collateral agreement with AIG Parent which provides that in the event of: (i) a ratings downgrade of Corebridge Parent or CRBGLH long-term unsecured indebtedness below specified levels or (ii) the failure by CRBGLH to pay principal and interest on the External Debt when due, we must collateralize an amount equal to the sum of: (a) 100 % of the principal amount outstanding, (b) accrued and unpaid interest and (c) 100 % of the net present value of scheduled interest payments through the maturity dates of the CRBGLH External Debt. • For additional discussion on commitments and guarantees associated with VIEs, see Note 9. • For additional disclosures about derivatives, see Note 10. • For additional disclosures about related parties, see Note 20 . 17. Equity COMMON STOCK The following table presents a rollforward of outstanding shares : Three Months Ended March 31, 2024 Common Stock Issued Treasury Stock Common Stock Outstanding Shares, beginning of year 648,148,737 ( 26,484,411 ) 621,664,326 Shares issued under long-term incentive compensation plans 2,041,112 1,169,261 3,210,373 Shares repurchased — ( 9,464,016 ) ( 9,464,016 ) Shares, end of period 650,189,849 ( 34,779,166 ) 615,410,683 Repurchase of Corebridge Common Stock Shares may be repurchased from time to time in the open market, through private purchases, through forward, derivative, accelerated repurchase or automatic repurchase transactions or otherwise. Certain of our share repurchases have been and may from time to time be effected through the Securities and Exchange Act of 1934, as amended (the Exchange Act) Rule 10b5-1 repurchase plans. On May 4, 2023, our Board of Directors authorized a $ 1 billion share repurchase program. The authorization for the share repurchase program may be terminated, increased or decreased by the Board of Directors at any time. From April 1, 2024 to April 26, 2024, we repurchased approximately 3.8 million shares of Corebridge Common Stock for an aggregate purchase price of approximately $ 105 million, leaving approximately $ 154 million under the share repurchase authorization as of April 26, 2024. On April 30, 2024, our Board of Directors authorized an additional $ 2.0 billion share repurchase program. Under this program, Corebridge Parent may, from time to time, purchase up to $ 2.0 billion of its common stock but is not obligated to purchase any particular number of shares. The authorization for the share repurchase program may be terminated, increased or decreased by the Board of Directors at any time. Corebridge | First Quarter 2024 Form 10-Q 64 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 17. Equity RETAINED EARNINGS Dividends Declaration Date Record Date Payment Date Dividend Paid Per Common Share February 14, 2024 March 15, 2024 March 29, 2024 $ 0.23 Dividends Declared On May 2, 2024, the Company declared a cash dividend on Corebridge common stock of $ 0.23 per share, payable on June 28, 2024 to shareholders of record at close of business on June 14, 2024. Accumulated Other Comprehensive Income (Loss) The following table presents a rollforward of Accumulated other comprehensive income (loss): (in millions) Unrealized Appreciation (Depreciation) of Fixed Maturity Securities on Which allowance for credit losses was Taken Unrealized Appreciation (Depreciation) of All Other Investments Change in fair value of market risk benefits attributable to changes in our own credit risk Change in the discount rates used to measure traditional and limited payment long-duration insurance contracts Cash Flow Hedges Foreign Currency Translation Adjustments Retirement Plan Liabilities Adjustment Total Balance, December 31, 2023, net of tax $ ( 79 ) $ ( 14,650 ) $ ( 909 ) $ 2,095 $ 146 $ ( 63 ) $ 2 $ ( 13,458 ) Change in unrealized depreciation of investments * 45 ( 1,120 ) — — — — — ( 1,075 ) Change in fair value of market risk benefits attributable to changes in our own credit risk — — ( 29 ) — — — — ( 29 ) Change in discount rates assumptions of certain liabilities — — — 695 — — — 695 Change in future policy benefits and other — ( 127 ) — — — — — ( 127 ) Change in cash flow hedges — — — — ( 25 ) — — ( 25 ) Change in foreign currency translation adjustments — — — — — ( 4 ) — ( 4 ) Change in net actuarial loss — — — — — — — — Change in deferred tax asset (liability) ( 10 ) 71 6 ( 152 ) 5 1 — ( 79 ) Total other comprehensive income (loss) 35 ( 1,176 ) ( 23 ) 543 ( 20 ) ( 3 ) — ( 644 ) Other — ( 39 ) — — 1 — — ( 38 ) Less: Noncontrolling interests — — — — — ( 1 ) — ( 1 ) Balance, March 31, 2024, net of tax $ ( 44 ) $ ( 15,865 ) $ ( 932 ) $ 2,638 $ 127 $ ( 65 ) $ 2 $ ( 14,139 ) Balance, December 31, 2022, net of tax $ ( 92 ) $ ( 19,380 ) $ ( 365 ) $ 2,908 $ 157 $ ( 100 ) $ 9 $ ( 16,863 ) Change in unrealized depreciation of investments 38 3,982 — — — — — 4,020 Change in fair value of market risk benefits attributable to changes in our own credit risk — — 94 — — — — 94 Change in discount rates assumptions of certain liabilities — — — ( 595 ) — — — ( 595 ) Change in future policy benefits and other — ( 116 ) — — — — — ( 116 ) Change in cash value hedges — — — — ( 7 ) — — ( 7 ) Change in foreign currency translation adjustments — — — — — 37 — 37 Change in net actuarial loss — — — — — — 3 3 Change in deferred tax asset (liability) ( 8 ) ( 734 ) ( 20 ) 130 3 ( 1 ) ( 1 ) ( 631 ) Total other comprehensive income (loss) 30 3,132 74 ( 465 ) ( 4 ) 36 2 2,805 Other — — — — — — — — Less: Noncontrolling interests — — — — — 9 — 9 Balance, March 31, 2023, net of tax $ ( 62 ) $ ( 16,248 ) $ ( 291 ) $ 2,443 $ 153 $ ( 73 ) $ 11 $ ( 14,067 ) * Includes the change in net unrealized gains and losses attributable to held-for-sale businesses at March 31, 2024 and December 31, 2023. Corebridge | First Quarter 2024 Form 10-Q 65 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 17. Equity The following table presents the OCI reclassification adjustments for the three months ended March 31, 2024 and 2023, respectively: (in millions) Unrealized Appreciation (Depreciation) of Fixed Maturity Securities on Which Allowance for Credit Losses Was Taken Unrealized Appreciation (Depreciation) of All Other Investments Change in fair value of market risk benefits attributable to changes in our own credit risk Change in the discount rates used to measure traditional and limited payment long-duration insurance contracts Cash Flow Hedges Foreign Currency Translation Adjustments Retirement Plan Liabilities Adjustment Total Three Months Ended March 31, 2024 Unrealized change arising during period $ 39 $ ( 1,583 ) $ ( 29 ) $ 695 $ ( 25 ) $ ( 4 ) $ — $ ( 907 ) Less: Reclassification adjustments included in net income ( 6 ) ( 336 ) — — — — — ( 342 ) Total other comprehensive income (loss), before income tax expense (benefit) 45 ( 1,247 ) ( 29 ) 695 ( 25 ) ( 4 ) — ( 565 ) Less: Income tax expense (benefit) 10 ( 71 ) ( 6 ) 152 ( 5 ) ( 1 ) — 79 Total other comprehensive income (loss), net of income tax expense (benefit) $ 35 $ ( 1,176 ) $ ( 23 ) $ 543 $ ( 20 ) $ ( 3 ) $ — $ ( 644 ) Three Months Ended March 31, 2023 Unrealized change arising during period $ 24 $ 3,779 $ 94 $ ( 595 ) $ ( 7 ) $ 37 $ 3 $ 3,335 Less: Reclassification adjustments included in net income ( 14 ) ( 87 ) — — — — — ( 101 ) Total other comprehensive income (loss), before income tax expense (benefit) 38 3,866 94 ( 595 ) ( 7 ) 37 3 3,436 Less: Income tax expense (benefit) 8 734 20 ( 130 ) ( 3 ) 1 1 631 Total other comprehensive income (loss), net of income tax expense (benefit) $ 30 $ 3,132 $ 74 $ ( 465 ) $ ( 4 ) $ 36 $ 2 $ 2,805 The following table presents the effect of the reclassification of significant items out of Accumulated other comprehensive income on the respective line items in the Condensed Consolidated Statements of Income (Loss)*: Amount Reclassified from AOCI Affected Line Item in the Condensed Consolidated Statements of Income (Loss) Three Months Ended March 31, (in millions) 2024 2023 Unrealized appreciation (depreciation) of fixed maturity securities on which allowance for credit losses was taken Investments $ ( 6 ) $ ( 14 ) Net realized gains (losses) Total ( 6 ) ( 14 ) Unrealized appreciation (depreciation) of all other investments Investments ( 336 ) ( 87 ) Net realized gains (losses) Total ( 336 ) ( 87 ) Total reclassifications for the period $ ( 342 ) $ ( 101 ) * The following items are not reclassified out of AOCI and included in the Condensed Consolidated Statements of Income (Loss) and thus have been excluded from the table:(a) Change in fair value of MRBs attributable to changes in our own credit risk (b) Change in the discount rates used to measure traditional and limited-payment long-duration insurance contracts and (c) Fair value of liabilities under fair value option attributable to changes in our own credit risk. NON-REDEEMABLE NONCONTROLLING INTEREST The activity in non-redeemable noncontrolling interest primarily relates to activities with consolidated investment entities. The changes in non-redeemable noncontrolling interest due to divestitures and acquisitions primarily relate to the formation and funding of new consolidated investment entities. The majority of the funding for these consolidated investment entities comes from affiliated companies of Corebridge. The changes in non-redeemable noncontrolling interest due to contributions from noncontrolling interests primarily relate to the additional capital calls related to consolidated investment entities. Corebridge | First Quarter 2024 Form 10-Q 66 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 17. Equity The changes in non-redeemable noncontrolling interest due to distributions to noncontrolling interests primarily relate to dividends or other distributions related to consolidated investment entities. The following table presents a rollforward of non-redeemable noncontrolling interest: Three Months Ended March 31, (in millions) 2024 2023 Beginning balance $ 869 $ 939 Net income (loss) attributable to redeemable noncontrolling interest ( 51 ) 6 Other comprehensive income (loss), net of tax ( 1 ) 9 Changes in noncontrolling interests due to divestitures and acquisitions 1 ( 19 ) Contributions from noncontrolling interests 21 25 Distributions to noncontrolling interests ( 29 ) ( 50 ) Ending balance $ 810 $ 910 Refer to Note 9 for additional information related to Variable Interest Entities. 18. Earnings Per Common Share The basic earnings per common share (“EPS”) computation is based on the weighted average number of common shares outstanding, adjusted to reflect all stock splits. The diluted EPS computation is based on those shares used in the basic EPS computation plus common shares that would have been outstanding assuming issuance of common shares for all dilutive potential common shares outstanding and adjusted to reflect all stock splits, using the treasury stock method. The following table presents the computation of basic and diluted EPS for the three months ended March 31, 2024 and 2023: Three Months Ended March 31, (in millions, except per common share data) 2024 2023 Numerator for EPS: Net income (loss) $ 827 $ ( 453 ) Less: Net income (loss) attributable to noncontrolling interests ( 51 ) 6 Net income (loss) attributable to Corebridge common shareholders $ 878 $ ( 459 ) Denominator for EPS: Weighted average common shares outstanding - basic 624.0 650.8 Dilutive common shares 0.9 — Weighted average common shares outstanding - diluted 624.9 650.8 Income per common share attributable to Corebridge common shareholders Common stock - basic $ 1.41 $ ( 0.70 ) Common stock - diluted $ 1.41 $ ( 0.70 ) * Potential dilutive common shares include our share-based employee compensation plans. The number of common shares excluded from dilutive shares outstanding was approximately 0.4 million and 2.5 million for the three months ended March 31, 2024 and 2023, respectively, because the effect of including those common shares in the calculation would have been anti-dilutive. Corebridge | First Quarter 2024 Form 10-Q 67 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 19. Income Taxes 19. Income Taxes RECENT TAX LAW CHANGES The Inflation Reduction Act of 2022 (H.R. 5376), (the “Inflation Reduction Act”) includes a 15% corporate alternative minimum tax (“CAMT”) on adjusted financial statement income for corporations with average profits over $1 billion over a three-year period and a 1% stock buyback tax. Although the U.S. Treasury and Internal Revenue Service (“IRS”) issued interim CAMT guidance during 2023, many details and specifics of application of the CAMT remain subject to future guidance. Our estimated CAMT liability will continue to be refined based on future guidance. BASIS OF PRESENTATION Prior to the IPO, Corebridge Parent and certain U.S. subsidiaries were included in the consolidated federal income tax return of AIG as well as certain state tax returns where AIG files on a combined or unitary basis. Following the IPO, AIG owned less than 80 % interest in Corebridge, resulting in tax deconsolidation of Corebridge from the AIG Consolidated Tax Group. In addition, under the tax law, AGC and its directly owned life insurance subsidiaries (the “AGC Group”) will not be permitted to join in the filing of a U.S. consolidated federal income tax return with our other subsidiaries (collectively, the “Non-Life Group”) for the five-year waiting period. Instead, the AGC Group is expected to file separately as members of the AGC Group consolidated U.S. federal income tax return during the five-year waiting period. Following the five-year waiting period, the AGC Group is expected to join the U.S. consolidated federal income tax return with the Non-Life Group. RECLASSIFICATION OF CERTAIN TAX EFFECTS FROM AOCI We use an item-by-item approach to release the stranded or disproportionate income tax effects in AOCI related to our available-for-sale securities. Under this approach, a portion of the disproportionate tax effects is assigned to each individual security lot at the date the amount becomes lodged. When the individual securities are sold, mature or are otherwise impaired on an other-than-temporary basis, the assigned portion of the disproportionate tax effect is reclassified from AOCI to income (loss) from operations. INTERIM TAX CALCULATION METHOD We use the estimated annual effective tax rate method in computing our interim tax provision. Certain items, including those deemed to be unusual or infrequent or that cannot be reliably estimated, are excluded from the estimated annual effective tax rate. In these cases, the actual tax expense or benefit is reported in the same period as the related item. Certain tax effects are also not reflected in the estimated annual effective tax rate, primarily certain changes in uncertain tax positions and realizability of deferred tax assets, and are recorded in the period in which the change occurs. INTERIM TAX EXPENSE (BENEFIT) For the three months ended March 31, 2024, the effective tax rate on income from operations was 18.6 %. The effective tax rate on income from operations differs from the statutory tax rate of 21 % primarily due to tax benefits associated with dividends received deduction, excess tax benefits related to share based compensation payments recorded through the income statement, adjustments to deferred tax assets, tax adjustments related to prior year returns including interest, and reclassifications from AOCI to income from operations related to the disposal of available-for-sale securities. These tax benefits were partially offset by the net establishment of additional U.S. federal and foreign valuation allowance and tax charges associated with state and local income taxes. For the three months ended March 31, 2023, the effective tax rate on loss from operations was 32.3 %. The effective tax rate on loss from operations differs from the statutory tax rate of 21 % primarily due to adjustments to deferred tax assets, dividends received deduction, reclassifications from AOCI to income from operations related to the disposal of available-for-sale securities, and excess tax benefits related to share based compensation payments recorded through the income statement. These tax benefits were partially offset by the establishment of additional valuation allowance and tax charges associated with state and local income taxes. As a result of the held-for-sale designation of AIG Life, as of March 31, 2024, we do not consider our foreign earnings with respect to our operations in Europe to be indefinitely reinvested. Deferred taxes, if necessary, have been provided on earnings of non-U.S. affiliates whose earnings are not indefinitely reinvested. Corebridge | First Quarter 2024 Form 10-Q 68 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 19. Income Taxes ASSESSMENT OF DEFERRED TAX ASSET VALUATION ALLOWANCE The evaluation of the recoverability of our deferred tax asset and the need for a valuation allowance requires us to weigh all positive and negative evidence to reach a conclusion that it is more likely than not that all or some portion of the deferred tax asset will not be realized. The weight given to the evidence is commensurate with the extent to which it can be objectively verified. The more negative evidence that exists, the more positive evidence is necessary and the more difficult it is to support a conclusion that a valuation allowance is not needed. As discussed above, under the tax law, the AGC Group will not be permitted to join in the filing of a U.S. consolidated federal income tax return with the Non-Life Group for the five-year waiting period following the IPO. Instead, the AGC Group is expected to file separately as members of the AGC consolidated U.S. federal income tax return during this period. Following the five-year waiting period, the AGC Group is expected to join U.S. consolidated federal income tax return with the Non-Life Group. Each separate U.S. federal tax filing group or separate U.S. tax filer is required to consider this five-year waiting period when assessing realization of their respective deferred tax assets including net operating loss and tax credit carryforwards. Recent events, changes in target interest rates by the Board of Governors of the Federal Reserve System and significant market volatility, impacted actual and projected results of our business operations as well as our views on potential effectiveness of certain prudent and feasible tax planning strategies. In order to demonstrate the predictability and sufficiency of future taxable income necessary to support the realizability of the net operating losses and foreign tax credit carryforwards, we have considered forecasts of future income for each of our businesses, including assumptions about future macroeconomic and Corebridge-specific conditions and events, and any impact these conditions and events may have on our prudent and feasible tax planning strategies. To the extent that the valuation allowance is attributed to changes in forecast of current year taxable income, the impact is included in our estimated annualized effective tax rate. A valuation allowance related to changes in forecasts of income in future periods as well as other items not related to the current year is recorded discretely. For the three months ended March 31, 2024, we recorded an increase in valuation allowance of $ 15 million primarily attributable to current year activity. As of March 31, 2024, the balance sheet reflects a valuation allowance of $ 177 million related to our tax attribute carryforwards and a portion of certain other deferred tax assets that are no longer more-likely-than-not to be realized. Estimates of future taxable income, including income generated from prudent and feasible actions and tax planning strategies, impact of settlements with taxing authorities, and any changes to interpretations and assumptions related to the impact of the Inflation Reduction Act or the Tax Act, could change in the near term, perhaps materially, which may require us to consider any potential impact to our assessment of the recoverability of the deferred tax asset. Such potential impact could be material to our consolidated financial condition or results of operations for an individual reporting period. For the three months ended March 31, 2024, recent changes in market conditions, including rising interest rates, impacted the unrealized tax capital gains and losses in the U.S. life insurance companies’ available-for-sale securities portfolio, resulting in a deferred tax asset related to net unrealized tax capital losses. The deferred tax asset relates to the unrealized capital losses for which the carryforward period has not yet begun, and as such, when assessing its recoverability, we consider our ability and intent to hold the underlying securities to recovery. As of March 31, 2024, based on all available evidence, we concluded that a valuation allowance should be established on a portion of the deferred tax asset related to unrealized capital losses that are not more likely than not to be realized. For the three months ended March 31, 2024, we recorded an increase in valuation allowance of $ 194 million, respectively, associated with the unrealized tax capital losses in the U.S. life insurance companies’ available-for-sale securities portfolio. As of March 31, 2024, the balance sheet reflects a valuation allowance of $ 1.2 billion associated with the unrealized tax capital losses in the U.S. Life Insurance Companies’ available-for-sale securities portfolio. All of the valuation allowance established was allocated to OCI. For the three months ended March 31, 2024, we recognized a $ 2 million increase in deferred tax asset valuation allowance associated with certain foreign jurisdictions. TAX EXAMINATIONS AND LITIGATION Corebridge Parent and certain U.S. subsidiaries are included in a consolidated U.S. federal income tax return with AIG through the date of IPO (short-period tax year 2022), and income tax expense is recorded, based on applicable U.S. and foreign laws. The AIG Consolidated Tax Group is currently under IRS examination for the tax years 2011 through 2019 and is continuing to engage in the appeals process for years 2007 through 2010. We are periodically advised of certain IRS and other adjustments identified in AIG's consolidated tax return which are attributable to our operations. Under our tax sharing arrangement, we provide a charge or credit for the effect of the adjustments and the related interest in the period we are advised of such adjustments and interest . Corebridge | First Quarter 2024 Form 10-Q 69 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 20. Related Parties 20. Related Parties RELATED PARTY TRANSACTIONS We may enter into a significant number of transactions with related parties in the normal course of business. Parties are considered to be related if one party has the ability to control or exercise significant influence over the other party in making financial or operating decisions, or if a party, directly or indirectly through one or more of its intermediaries, controls, is controlled by or is under common control with an entity. Our material transactions with related parties are described below. Related Party Transactions with AIG We have historically entered into various transactions with AIG, some of which are continuing and are described below. In addition, on September 14, 2022, we entered into a separation agreement with AIG (the “Separation Agreement”). The Separation Agreement governs the relationship between AIG and us following the IPO, including matters related to the allocation of assets and liabilities between the parties, indemnification obligations, our corporate governance, information rights for each party and consent rights of AIG with respect to certain business activities that we may undertake. Advisory Transactions Certain of our investment management subsidiaries provide advisory, management, allocation, structuring, planning, oversight, administration and similar services (collectively, “Investment Services”) with respect to the investment portfolios of AIG. Investment Services are provided primarily pursuant to investment management, investment advisory and similar agreements (“IMAs”), under which our subsidiaries are appointed as investment manager and are authorized to manage client investment portfolios on a fully discretionary basis, subject to agreed investment guidelines. Certain of our subsidiaries are also authorized under the IMAs to retain, oversee and direct third-party investment advisers and managers for and on behalf of these AIG clients. In some cases, Investment Services are provided through the clients’ participation in private investment funds, RMBS, CLO and other pooled investment vehicles and investment products (collectively, “Funds”) sponsored or managed by us. Separately, certain of our subsidiaries provide portfolio administration and investment planning, performance evaluation and oversight services to AIG PC International, LLC (“AIGPCI”), on a non-discretionary basis, with respect to the investment portfolios of various of AIGPCI’s non-U.S. subsidiaries. In some cases, these services are directly provided to AIGPCI’s non-US subsidiaries. We offer our Funds to AIGPCI’s non-U.S. subsidiaries. Our subsidiaries earn investment management and advisory fees under the IMAs and other service agreements, as well as management fees and carried interest distributions or similar performance-based compensation under the Funds’ operating agreements, the majority of which are based on, or calibrated to approximate, the costs of providing the services. With respect to a minority of the AIG client portfolios, which relate to assets backing risks that have been transferred to third parties, our subsidiaries earn market-based fees. Management and advisory fee income for these Investment Services and related services reflected in Other income on the Condensed Consolidated Statements of Income (Loss) were $ 7 million and $ 13 million for the three months ended March 31, 2024 and 2023, respectively. Capital Markets Agreements Historically, we received a suite of capital markets services, including securities lending, collateral management, repurchase transactions, derivatives execution and support, and operational support services, from AIG for which we pay a fee. AIG Markets, Inc. (“AIGM”) provided these services through various services agreements. The suite of capital markets services previously provided by AIGM are now provided by our consolidated subsidiary Corebridge Markets, LLC (“CRBGM”). The majority of transactions previously outstanding with AIGM were legally transferred to CRBGM as of December 31, 2023. In addition, in the ordinary course of business, we enter into over-the-counter derivative transactions with AIGM under standard ISDA Master Agreements. We previously had certain unsecured derivative transactions with AIG. On May 4, 2023, these previously unsecured derivative transactions became fully collateralized. The total expenses incurred for services provided by AIGM reflected in Net investment income - excluding Fortitude Re funds withheld assets on the Condensed Consolidated Statements of Income (Loss) were $ 0 million and $ 0 million for the three months ended March 31, 2024 and 2023, respectively. The derivative assets, net of gross assets and gross liabilities after collateral were $ 0 million and $ 13 million as of March 31, 2024 and December 31, 2023, respectively. The derivative liabilities, net of gross assets and gross liabilities after collateral were $ 0 million and $ 0 million as of March 31, 2024 and December 31, 2023, respectively. The collateral posted to AIGM was $ 0 million and $ 0 million as of March 31, 2024 and December 31, 2023, respectively. The collateral held by us was $ 220 million and $ 377 million as of March 31, 2024 and December 31, 2023, respectively. For further details regarding derivatives, see Note 10. Corebridge | First Quarter 2024 Form 10-Q 70 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 20. Related Parties General Services Agreements Pursuant to the provisions of a Service and Expense Agreement (the “AIG Service and Expense Agreement”) effective February 1, 1974, as amended, we and AIG have provided various services to each other at cost, including, but not limited to, advertising, accounting, actuarial, tax, legal, data processing, claims adjustment, employee cafeteria, office space, payroll, information technology services, capital markets services, services that support financial transactions and budgeting, risk management and compliance services, human resources services, insurance, operations and other support services. On September 14, 2022, we entered into a Transition Services Agreement (the “TSA”) with AIG regarding the continued provision of services between the Company and AIG on a transitional basis. The TSA has generally replaced the AIG Service and Expense Agreement for services provided between the parties. Amounts due to AIG under these agreements were $ 3 million and $ 39 million as of March 31, 2024 and December 31, 2023, respectively. Amounts due from AIG were $ 16 million and $ 38 million as of March 31, 2024 and December 31, 2023, respectively. The total service expenses incurred specific to these agreements reflected in General operating and other expenses on the Condensed Consolidated Statements of Income (Loss) were $ 13 million and $ 47 million for the three months ended March 31, 2024 and 2023, respectively. Reinsurance Transactions From time to time, AIG Life has entered into various coinsurance agreements with American International Reinsurance Company, Ltd., a consolidated subsidiary of AIG (“AIRCO”) as follows: • In 2018, AIG Life ceded risks to AIRCO relating to the payment of obligations of life-contingent annuity claims in the annuitization phase of the contracts on or after June 30, 2018. • In 2019 and 2020, AIG Life ceded risks to AIRCO relating to certain whole life policies issued prior to and subsequent to July 1, 2019, respectively. Reinsurance assets related to these agreements were $ 65 million and $ 67 million as of March 31, 2024 and December 31, 2023, respectively. Amounts payable to AIRCO were $ 20 million and $ 13 million as of March 31, 2024 and December 31, 2023, respectively. Ceded premiums related to these agreements were $ 9 million and $ 7 million for the three months ended March 31, 2024 and 2023, respectively. Reinsurance assets and amounts payable related to these agreements have been reclassified to Assets held-for-sale and Liabilities held-for-sale, respectively. For further details of reinsurance transactions, see Note 8. Guarantees Prior to the IPO, AIG provided certain guarantees to us. Pursuant to the Separation Agreement, we will indemnify, defend and hold harmless AIG against or from any liability arising from or related to such guarantees. For further details regarding guarantees previously provided by AIG, see Note 16. Tax Sharing Agreements On September 14, 2022, we entered into a tax matters agreement with AIG that governs the parties’ respective rights, responsibilities, and obligations with respect to taxes, including the allocation of current and historic tax liabilities (whether income or non-income consolidated or stand-alone) between us and AIG (the “Tax Matters Agreement”). The Tax Matters Agreement governs, among other things, procedural matters, such as filing of tax returns, tax elections, control and settlement of tax controversies and entitlement to tax refunds and tax attributes. Prior to the IPO, Corebridge and SAFG Capital LLC were included in the consolidated federal income tax return of AIG as well as certain state tax returns where AIG files on a combined or unitary basis. There were no payments to AIG in connection with the tax sharing agreements for the three months ended March 31, 2024 and 2023. Amounts receivable (payable) from or to AIG pursuant to the tax sharing agreements were $( 378 ) million and $( 371 ) million as of March 31, 2024 and December 31, 2023, respectively. Employee Compensation and Benefits Our employees participate in certain of AIG’s employee benefit programs. We had a payable of $ 22 million and $ 32 million as of March 31, 2024 and December 31, 2023, respectively, with respect to these programs. On September 14, 2022, we entered into an employee matters agreement with AIG (the “EMA”). The EMA allocates liabilities and responsibilities relating to employment matters, employee compensation and benefits plans and programs, and other related matters between us and AIG. The EMA generally provides that, unless otherwise specified, each party is responsible for liabilities associated with their current and former employees for purposes of compensation and benefit matters following the IPO. Corebridge | First Quarter 2024 Form 10-Q 71 TABLE OF CONTENTS ITEM 1 | Notes to Condensed Consolidated Financial Statements (Unaudited) | 20. Related Parties Related Party Transactions with Blackstone Inc. (“Blackstone”) Investment Expense We entered into a long-term asset management relationship with Blackstone to manage a portion of our investment portfolio. The investment expense incurred were $ 51 million and $ 35 million for the three months ended March 31, 2024 and 2023, respectively. Related Party Transactions with Variable Interest Entities In the ordinary course of business, we enter into various arrangements with VIEs, and we consolidate the VIE if we are determined to be the primary beneficiary. In certain situations, we may have a variable interest in a VIE that is consolidated by an affiliate, and in other instances, affiliates may have variable interests in a VIE that is consolidated by us. The total debt of consolidated VIEs held by affiliates was $ 102 million and $ 102 million as of March 31, 2024 and December 31, 2023, respectively. The interest expense incurred on the debt reflected in Interest expense on the Condensed Consolidated Statements of Income (Loss) was $ 1 million and $ 7 million for the three months ended March 31, 2024 and 2023, respectively. The noncontrolling interest included in the Condensed Consolidated Balance Sheets related to the VIEs held by affiliates was $ 478 million and $ 518 million as of March 31, 2024 and December 31, 2023, respectively. The gain/(loss) attributable to noncontrolling interest of consolidated VIEs held by affiliates was $( 21 ) million and $ 19 million for the three months ended March 31, 2024 and 2023, respectively. In addition to transactions with VIEs, Corebridge has entered into other structured financing arrangements supporting real estate properties and other types of assets with other AIG affiliates. These financing arrangements are reported in Other invested assets in the Condensed Consolidated Balance Sheets. Certain of these and the VIE structures above also include commitments for funding from other AIG affiliates. For additional information related to VIEs and other investments, see Notes 6 and 9. Corebridge | First Quarter 2024 Form 10-Q 72 TABLE OF CONTENTS Item 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations Glossary and Acronyms of Selected Insurance Terms and References Throughout this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), we use certain terms and abbreviations, which are summarized in the Glossary and Acronyms. Corebridge has incorporated into this discussion a number of cross-references to additional information included throughout this Quarterly Report to assist readers seeking additional information related to a particular subject. In this Quarterly Report, unless otherwise mentioned or unless the context indicates otherwise, we use the terms “Corebridge,” “we,” “us” and “our” to refer to Corebridge Financial, Inc., a Delaware corporation, and its consolidated subsidiaries. We use the term “Corebridge Parent” to refer solely to Corebridge Financial, Inc., and not to any of its consolidated subsidiaries. This MD&A addresses the consolidated financial condition of Corebridge as of March 31, 2024, compared with December 31, 2023, and its consolidated results of operations for the three months ended March 31, 2024 and 2023. In addition to historical data, this discussion contains forward-looking statements about our business operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Actual results may differ materially from those discussed in the forward-looking statements as a result of various factors. You should read the following analysis of our consolidated financial condition and results of operations in conjunction with the “Management’s Discussion and Analysis of Results of Operations and Financial Condition,” the unaudited Condensed Consolidated Financial Statements and the statements under “Cautionary Statements Regarding Forward-Looking Information,” included elsewhere in this Quarterly Report and the “Risk Factors” section in the 2023 Form 10-K. Corebridge | First Quarter 2024 Form 10-Q 73 TABLE OF CONTENTS Index to Item 2 Page Executive Summary 75 Overview 75 Revenues 75 Benefits and Expenses 75 Significant Factors Impacting our Results 76 Corebridge’s Outlook - Macroeconomic, Industry and Regulatory Trends 78 Use of Non-GAAP Measures 81 Key Operating Metrics 85 Consolidated Results of Operations 88 Business Segment Operations 90 Individual Retirement 91 Group Retirement 94 Life Insurance 97 Institutional Markets 99 Corporate and Other 102 Investments 103 Overview 103 Key Investment Strategies 103 Credit Ratings 106 Future Policy Benefits, Policyholder Contract Deposits and Market Risk Benefits 122 Liquidity and Capital Resources 125 Overview 125 Liquidity and Capital Resources of Corebridge Parent and Intermediate Holding Companies 125 Liquidity and Capital Resources of Corebridge Insurance Subsidiaries 126 Short-Term and Long-Term Debt 128 Credit Ratings 129 Off-Balance Sheet Arrangements and Commercial Commitments 129 Accounting Policies and Pronouncements 130 Critical Accounting Estimates 130 Adoption of Accounting Pronouncements 130 Glossary 131 Certain Important Terms 133 Acronyms 134 Corebridge | First Quarter 2024 Form 10-Q 74 TABLE OF CONTENTS ITEM 2 | Executive Summary Executive Summary OVERVIEW We are one of the largest providers of retirement solutions and insurance products in the United States, committed to helping individuals plan, save for and achieve secure financial futures. We offer a broad set of products and services through our market leading Individual Retirement, Group Retirement, Life Insurance and Institutional Markets businesses, each of which features capabilities and industry experience we believe are difficult to replicate. These four businesses collectively seek to enhance stockholder returns while maintaining our attractive risk profile, which has historically resulted in consistent and strong cash flow generation. REVENUES Our revenues come from five principal sources: • Premiums are principally derived from our traditional life insurance and certain annuity products including pension risk transfer (“PRT”) transactions and structured settlements with life contingencies. Our premium income is driven by growth in new policies and contracts written and persistency of our in-force policies, both of which are influenced by a combination of factors including our efforts to attract and retain customers and market conditions that influence demand for our products; • Policy fees are principally derived from our individual retirement, group retirement, universal life insurance, Corporate Markets and SVW products. Our policy fees typically vary directly with the underlying account value or benefit base of our annuities. Account value and benefit base are influenced by changes in economic conditions, including changes in levels of equity prices, and changes in levels of interest rates and credit spreads, as well as net flows; • Net investment income from our investment portfolio varies as a result of the yield, allocation and size of our investment portfolio, which are, in turn, a function of capital market conditions and net flows into our total investments, as well as the expenses associated with managing our investment portfolio; • Net realized gains (losses), net include changes in the Fortitude Re funds withheld embedded derivative, risk management related derivative activities (excluding hedges of certain MRBs), changes in the fair value of embedded derivatives in certain of our insurance products and trading activity within our investment portfolio, including trading activity related to the Fortitude Re modco arrangement. Net realized gains (losses) vary due to the timing of sales of investments as well as changes in the fair value of embedded derivatives in certain of our insurance products and derivatives utilized to hedge certain embedded derivatives; and • Advisory fee income and other income includes fees from registered investment advisory services, 12b-1 fees (marketing and distribution fees paid by mutual funds), other asset management fee income and commission-based broker-dealer services. BENEFITS AND EXPENSES Our benefits and expenses come from six principal sources: • Policyholder benefits are driven primarily by customer withdrawals and surrenders from traditional products which change in response to changes in capital market conditions and changes in policy reserves, as well as life contingent benefit payments on life and annuity contracts and updates to assumptions related to future policyholder behavior, mortality and longevity; • Interest credited to policyholder account balances varies in relation to the amount of the underlying account value or benefit base and also includes changes in the fair value of certain embedded derivatives related to our insurance products and amortization of deferred sales inducement assets; • Amortization of deferred policy acquisition costs and value of business acquired for all contracts except for other investment contracts is amortized, on a constant level basis over the expected term of the related contracts, using assumptions consistent with those used in estimating the related liability for future policy benefits, or any other related balances, for those corresponding contracts, as applicable. VOBA is determined at the time of acquisition and is reported with DAC. This value is based on the present value of future pre-tax profits discounted at yields applicable at the time of purchase; • General operating and other expenses include expenses associated with conducting our business, including salaries, other employee-related compensation and other operating expenses such as professional services or travel; • Change in the fair value of market risk benefits, net represents the changes in fair value of MRBs contained within certain insurance contracts (excluding the impact of changes in our own credit risk), including attributed fees, along with the changes in the fair value of derivatives that economically hedge MRBs. Changes in our own credit risk are included in OCI; and Corebridge | First Quarter 2024 Form 10-Q 75 TABLE OF CONTENTS ITEM 2 | Executive Summary • Interest expense represents the charges associated with our external debt obligations, including debt of consolidated investment entities. This expense varies based on the amount of debt on our balance sheet, as well as the rates of interest associated with those obligations. Interest expense related to consolidated investment entities principally relates to variable interest entities (“VIEs”) for which we are the primary beneficiary; however, creditors or beneficial interest holders of VIEs generally only have recourse to the assets and cash flows of the VIEs and do not have recourse to us except in limited circumstances when we have provided a guarantee to the VIE’s interest holders. SIGNIFICANT FACTORS IMPACTING OUR RESULTS The following significant factors have impacted, and may in the future impact, our business, results of operations, financial condition and liquidity. Impact of Fortitude Re In 2018, AIG established Fortitude Re, a wholly-owned subsidiary of Fortitude Group Holdings, LLC (“Fortitude Holdings”), in a series of reinsurance transactions related to certain of AIG’s legacy operations. In February 2018, AGL, VALIC and USL entered into modco agreements with Fortitude Re, a registered Class 4 and Class E reinsurer in Bermuda. Following the sale of AIG’s majority ownership interest in Fortitude Holdings, AIG contributed its remaining ownership in Fortitude Re Bermuda and its one seat on its Board of Managers to us. As of March 31, 2024, our ownership interest in Fortitude Re was 2.46%. In the modco arrangement, the investments supporting the reinsurance agreements, which reflect the majority of the consideration that would be paid to the reinsurer for entering into the transaction, are withheld by, and therefore continue to reside on the balance sheet of, the ceding company (i.e., AGL, VALIC and USL) thereby creating an obligation for the ceding company to pay the reinsurer (i.e., Fortitude Re) at a later date. Additionally, since we maintain ownership of these investments, we reflect our existing accounting for these assets, which consist primarily of available-for-sale securities (e.g., the changes in fair value of available-for-sale securities are recognized within OCI) on our balance sheet. We have established a funds withheld payable to Fortitude Re while simultaneously establishing a reinsurance asset representing liabilities for the insurance coverage that Fortitude Re has assumed. The funds withheld payable contains an embedded derivative and changes in fair value of this derivative are recognized in Net realized gains (losses) on Fortitude Re funds withheld embedded derivative. This embedded derivative is considered a total return swap with contractual returns that are attributable to various assets, primarily available-for-sale securities, associated with these reinsurance agreements. As the majority of the invested assets supporting the modco are fixed income securities that are available-for-sale, there is a mismatch between the accounting for the embedded derivative as its changes in fair value are recorded through net income while changes in the fair value of the fixed maturity securities available-for-sale are recorded through OCI. Our net income experiences ongoing volatility as a result of the reinsurance agreements, which, as described above, give rise to a funds withheld payable that contains an embedded derivative. However, this net income volatility is almost entirely offset with a corresponding change in OCI, which reflects the fair value change from the investment portfolio supporting the funds withheld payable, which is primarily available-for-sale securities, resulting in minimal impact to our comprehensive income (loss) and equity attributable to Corebridge. The Company has also elected the fair value option on the acquisition of certain new fixed maturity securities, helping reduce the mismatch over time. As of March 31, 2024, $26.1 billion of reserves had been ceded to Fortitude Re. For additional information on our reinsurance agreements with Fortitude Re, see Note 8 to the Condensed Consolidated Financial Statements. Impact of Variable Annuity Guaranteed Benefit Riders and Hedging Our Individual Retirement and Group Retirement businesses offer variable annuity products with riders that provide guaranteed benefits. The liabilities are accounted for as MRBs and measured at fair value. The fair value of the MRBs may fluctuate significantly based on market interest rates, equity prices, credit spreads, market volatility, policyholder behavior and other factors. In addition to risk-mitigating features in our variable annuity product design, we have an economic hedging program designed to manage market risk from GMWBs, including exposures to changes in interest rates, equity prices, credit spreads and volatility. The hedging program includes all in-force GMWB policies and utilizes derivative instruments, including, but not limited to, equity options, futures contracts and interest rate swap and option contracts, as well as fixed maturity securities. For additional information regarding Corebridge’s impact of Variable Annuity Guaranteed Benefit Riders and Hedging, see “Future Policy Benefits, Policyholder Contract Deposits and Market Risk Benefits — Variable Annuity Guaranteed Benefits and Hedging Results.” Corebridge | First Quarter 2024 Form 10-Q 76 TABLE OF CONTENTS ITEM 2 | Executive Summary Embedded Derivatives for Fixed Index Annuity and Index Universal Life Products Fixed index annuity contracts contain index interest credits which are accounted for as embedded derivatives and our index universal life insurance products also contain embedded derivatives. Policyholders may elect to rebalance among the various crediting strategies within the product at specified renewal dates. At the end of each index term, we generally have the opportunity to re-price the index component by establishing different participation rates or caps on index credited rates. The index crediting feature of these products results in the recognition of an embedded derivative that is required to be bifurcated from the host contract and carried at fair value with changes in the fair value of the liabilities recorded in Net realized gains (losses). Option pricing models are used to estimate fair value, taking into account assumptions for future index growth rates, volatility of the index, future interest rates and our ability to adjust the participation rate and the cap on index credited rates in light of market conditions and policyholder behavior assumptions. The following table summarizes the fair values of the embedded derivatives for fixed index annuity and index universal life products: (in millions) March 31, 2024 December 31, 2023 Fixed index annuities $ 7,603 $ 6,953 Index universal life $ 947 $ 989 Our Strategic Partnership with Blackstone In 2021, we entered into a strategic partnership with Blackstone pursuant to which Blackstone acquired a 9.9% position in our common stock and we entered into a long-term asset management relationship with Blackstone IM. As of March 31, 2024, Blackstone managed approximately $62.7 billion in book value of assets in our investment portfolio. For additional information on our Strategic Partnership with Blackstone, see “Investments” below. Our Investment Management Agreements with BlackRock Since April 2022, we entered into investment management agreements with BlackRock and its investment advisory affiliates. As of March 31, 2024, BlackRock managed approximately $85.7 billion in book value of assets in our investment portfolio, consisting of liquid fixed income and certain private placement assets. For additional information on our Investment Management Agreements with BlackRock, see “Investments” below. Fair Value Option Bond Securities We elect the fair value option on certain bond securities. When the fair value option is elected, the realized and unrealized gains and losses on these securities are reported in net investment income. The following table shows the net investment income reported on fair value option bond securities: Three Months Ended March 31, (in millions) 2024 2023 Net investment income - excluding Fortitude Re funds withheld assets $ 13 $ 10 Net investment income - Fortitude Re funds withheld assets 71 105 Total $ 84 $ 115 Separation Costs In connection with our separation from AIG, we have incurred and expect to continue to incur one-time and recurring expenses. As of March 31, 2024, we have incurred approximately $492 million of one-time expenses on a pre-tax basis. These expenses primarily relate to replicating and replacing functions, systems and infrastructure provided by AIG; rebranding; and accounting advisory, consulting and actuarial fees. In addition to these separation costs, we expect to incur costs related to the evolution of our investments organization to reflect our strategic partnerships with key external managers, our implementation of BlackRock’s “Aladdin” investment management technology platform and our expected reduction in fees for asset management services. In addition, as part of Corebridge Forward, we aim to achieve an annual run rate expense reduction of approximately $400 million on a pre-tax basis and expect the majority of the reduction to be achieved within 24 months of the IPO. Through March 31, 2024 we have acted upon or contracted approximately $394 million of exit run rate savings on a pre-tax basis. Corebridge Forward is expected to have a cumulative cost to achieve of approximately $300 million on a pre-tax basis. As of March 31, 2024, the cost to achieve has been approximately $181 million. Corebridge | First Quarter 2024 Form 10-Q 77 TABLE OF CONTENTS ITEM 2 | Executive Summary COREBRIDGE’S MACROECONOMIC, INDUSTRY AND REGULATORY TRENDS Our business is affected by industry and economic factors such as changes in interest rates and credit spreads; geopolitical tensions (including the ongoing armed conflicts between Ukraine and Russia and in the Middle East ); credit and equity market conditions; currency exchange rates; regulation; tax policy; competition; and general economic, market and political conditions. We continued to operate under market conditions in 2024 and 2023 characterized by factors such as higher interest rates, inflationary pressures, an uneven global economic recovery and global trade tensions. Responses by central banks and monetary authorities with respect to inflation, growth concerns and other macroeconomic factors have also affected global exchange rates and volatility. Below is a discussion of certain industry and economic factors impacting our business: Demographics We expect our target market of individuals planning for retirement to continue to grow with the size of the U.S. population age 65 and over that is expected to increase by approximately 30% by 2030 from just ten years earlier. In addition, we believe that reduced employer-paid retirement benefits will drive an increasing need for our individual retirement solutions. Further, consumers in the United States continue to prefer purchasing life insurance and retirement products through an agent or advisor, which positions us favorably given our broad distribution platform and in-house advisory capabilities. We continue to seek opportunities to develop new products and adapt our existing products to the growing needs of individuals to plan, save for and achieve secure financial futures. Equity Markets Our financial results are impacted by the performance of equity markets, which impacts the performance of our alternative investment portfolio, fee income, MRBs and embedded derivatives. For instance, in our variable annuity separate accounts, mutual fund assets and brokerage and advisory assets, we generally earn fee income based on the account value, which fluctuates with the equity markets as a significant amount of these assets are invested in equity funds. The impact of equity market returns, both increases and decreases, is reflected in our results due to the impact on the account value and the fair values of equity-exposed securities in our investment portfolio. Our hedging costs could also be significantly impacted by changes in the level of equity markets as rebalancing and option costs are tied to the equity market volatility. These hedging costs are partially offset by our rider fees that are tied to the level of the volatility index (“VIX”). As rebalancing and option costs increase or decrease, the rider fees will increase or decrease partially offsetting the hedging costs incurred. For Additional information see “Risk Factors—Risks Relating to Market Conditions—We are exposed to risk from equity market declines or volatility in the 2023 Form 10-K. Market and other economic factors may result in increased credit impairments, downgrades and losses across single or numerous asset classes due to lower collateral values or deteriorating cash flow and profitability by borrowers could lead to higher defaults on our investment portfolio, especially in geographic, industry or investment sectors where we have higher concentrations of exposure, such as real estate related borrowings. These factors can also cause widening of credit spreads which could reduce investment asset valuations, decrease fee income and increase statutory capital requirements, as well as reduce the availability of investments that are attractive from a risk-adjusted perspective. For additional information see “Risk Factors—Risks Relating to Market Conditions—Our business is highly dependent on economic and capital market conditions in the 2023 Form 10-K. Alternative investments include private equity funds which are generally reported on a one-quarter lag. Accordingly, changes in valuations driven by equity market conditions during the first quarter of 2024 may impact the private equity investments in the alternative investments portfolio in the second quarter of 2024. Impact of Changes in the Interest Rate Environment A rising interest rate environment benefits our spread income as we reinvest cash flows from existing business at higher rates and should have a positive impact on sales of spread-based products resulting in an increase in our base net investment spreads. As of March 31, 2024, increases in key rates have improved yields on new investments, which are now higher than the yield on maturities and redemptions that we are experiencing in our existing portfolios. Furthermore, the impact of interest rate increases is further reflected in our results as these rate increases have also reduced the value of fixed income assets that are held in the variable annuity separate accounts and brokerage and advisory assets, and accordingly, have adversely impacted the fees that are charged on these accounts. We actively manage our exposure to the interest rate environment through portfolio construction and asset-liability management, including spread management strategies for our investment-oriented products and economic hedging of interest rate risk from guarantee features in our variable annuities, but we may not be able to fully mitigate our interest rate risk by matching exposure of our assets relative to our liabilities. Corebridge | First Quarter 2024 Form 10-Q 78 TABLE OF CONTENTS ITEM 2 | Executive Summary Fluctuations in interest rates may result in changes to certain statutory reserve or capital requirements that are based on formulas or models that consider interest rates or prescribed interest rates, such as cash flow testing. Rising interest rates can have a mixed impact on statutory financials due to higher surrender activity, particularly for fixed annuities, offset by potentially lower reserves for other products under various statutory reserving frameworks. Regulatory Environment The insurance and financial services industries are generally subject to close regulatory scrutiny and supervision. Our operations are subject to regulation by a number of different types of domestic and international regulatory authorities, including securities, derivatives and investment advisory regulators. Our insurance subsidiaries are subject to regulation and supervision by the states and jurisdictions in which they do business. We expect that the domestic and international regulations applicable to us and our regulated entities will continue to evolve for the foreseeable future. For example, On March 6, 2024, the SEC adopted final rules that require registrants, including Corebridge, to disclose certain climate-related information in registration statements and annual reports. The final rules require registrants to disclose, among other things: the impacts of material climate-related risks; the processes for identifying, assessing and managing such risks; information about the oversight of climate-related risks by the board of directors and management’s role in managing material climate-related risks; and information about any climate-related targets or goals that are material to a registrant's business, results of operations, or financial condition. The final rules also require, if material, disclosure of registrants’ Scope 1 and/or Scope 2 greenhouse gas emissions. In addition, registrants must disclose certain information in their audited financial statements, including aggregate expenditures expensed and losses as well as capitalized costs and charges, in each case as a result of severe weather events and other natural conditions, subject to de minimis disclosure thresholds. The final rules include a phased-in compliance period beginning in fiscal year 2025 for large accelerated filers such as Corebridge. Numerous legal challenges were filed after the rule’s adoption, which lawsuits have been consolidated in the Eighth Circuit. On April 4, 2024, the SEC exercised its discretion to stay the final rules pending completion of judicial review in the U.S. Court of Appeals for the Eighth Circuit. Corebridge is evaluating the potential impacts of these new requirements. However, if these requirements are implemented following completion of judicial review, they may increase the complexity of Corebridge’s periodic reporting as a U.S. public company and are expected to result in additional compliance and reporting costs. In addition, on April 25, 2024, the Department of Labor (“DOL”) published a final rule in the Federal Register updating the definition for when a person is an “investment advice fiduciary” for purposes of transactions with ERISA qualified plans, related plan participants and IRAs. The DOL also published changes with respect to existing prohibited transactions exemptions (“PTEs”) relating to such advice, including PTE 84-24 and PTE 2020-02. The rule is effective September 23, 2024, and includes a one-year transition period thereafter for certain requirements. We are evaluating the potential impact of the DOL’s rule to our business. For information regarding our regulation and supervision by different regulatory authorities in the United States and abroad, see “Business—Regulation” in the 2023 Form 10-K. Annuity Sales and Surrenders The rising rate environment and our partnership with Blackstone have provided a strong tailwind for fixed and fixed index annuity sales, however, higher interest rates have also resulted in an increase in surrenders. Rising interest rates could continue to create the potential for increased sales but could also drive higher surrenders relative to what we have already experienced. Fixed annuities have surrender charge periods, generally in the three-to-seven-year range. Fixed index annuities have surrender charge periods, generally in the five-to-ten-year range, and within our Group Retirement segment, certain of our fixed investment options are subject to other withdrawal restrictions, which may help mitigate increased early surrenders in a rising rate environment. In addition, older contracts that have higher minimum interest rates and continue to be attractive to contract holders have driven better than expected persistency in fixed annuities, although the liabilities for such contracts have continued to decrease over time in amount and as a percentage of the total annuity portfolio. We closely monitor surrenders of fixed annuities as contracts with lower minimum interest rates come out of the surrender charge period. Reinvestment and Spread Management We actively monitor fixed income markets, including the level of interest rates, credit spreads and the shape of the yield curve. We also frequently review our interest rate assumptions and actively manage the crediting rates used for new and in-force business. Business strategies continue to evolve and we attempt to maintain profitability of the overall business in light of the interest rate environment. A rising interest rate environment results in improved yields on new investments and improves margins for our business while also making certain products, such as fixed annuities, more attractive to potential customers. However, the rising rate environment has resulted in lower values on general and separate account assets, mutual fund assets and brokerage and advisory assets that hold investments in fixed income assets. Corebridge | First Quarter 2024 Form 10-Q 79 TABLE OF CONTENTS ITEM 2 | Executive Summary For investment-oriented products, including universal life insurance, and variable, fixed and fixed index annuities, in each of our operating and reportable segments, our spread management strategies include disciplined pricing and product design for new business, modifying or limiting the sale of products that do not achieve targeted spreads, using asset-liability management to match assets to liabilities to the extent practicable and actively managing crediting rates to help mitigate some of the pressure on investment spreads. Renewal crediting rate management is guided by specific contract provisions designed to allow crediting rates to be reset at pre-established intervals and subject to minimum crediting rate guarantees. We expect to continue to adjust crediting rates on in-force business, as appropriate, to be responsive to changing rate environments. As interest rates rise, we may need to raise crediting rates on in-force business for competitive and other reasons, potentially offsetting a portion of the additional investment income resulting from investing in a higher interest rate environment. Of the aggregate fixed account values of our Individual Retirement and Group Retirement annuity products, 52% and 54% were crediting at the contractual minimum guaranteed interest rate at March 31, 2024 and December 31, 2023, respectively. The percentages of fixed account values of our annuity products that are currently crediting at rates above 1% were 49% and 50% at March 31, 2024 and December 31, 2023, respectively. In the universal life insurance products in our Life Insurance business, 59% and 59% of the account values were crediting at the contractual minimum guaranteed interest rate at March 31, 2024 and December 31, 2023, respectively. These businesses continue to focus on pricing discipline and strategies to manage the minimum guaranteed interest crediting rates offered on new sales in the context of regulatory requirements and competitive positioning. For additional information on our investment and asset-liability management strategies, see “Investments” below. Corebridge | First Quarter 2024 Form 10-Q 80 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics Use of Non-GAAP Financial Measures and Key Operating Metrics NON-GAAP FINANCIAL MEASURES Throughout this MD&A, we present our financial condition and results of operations in the way we believe will be most meaningful and representative of our business results. Some of the measurements we use are “non-GAAP financial measures” under SEC rules and regulations. We believe presentation of these non-GAAP financial measures allows for a deeper understanding of the profitability drivers of our business, results of operations, financial condition and liquidity. These measures should be considered supplementary to our results of operations and financial condition that are presented in accordance with GAAP and should not be viewed as a substitute for GAAP measures. The non-GAAP financial measures we present may not be comparable to similarly named measures reported by other companies. Reconciliations of non-GAAP financial measures for future periods are not provided as we do not currently have sufficient data to accurately estimate the variables and individual adjustments for such reconciliations. Adjusted revenues exclude Net realized gains (losses) except for gains (losses) related to the disposition of real estate investments, income from non-operating litigation settlements (included in Other income for GAAP purposes) and changes in fair value of securities used to hedge guaranteed living benefits (included in Net investment income for GAAP purposes). The following table presents a reconciliation of Total revenues to Adjusted revenues: Three Months Ended March 31, (in millions) 2024 2023 Total revenues $ 5,836 $ 4,262 Fortitude Re related items: Net investment (income) on Fortitude Re funds withheld assets (332) (394) Net realized (gains) losses on Fortitude Re funds withheld assets 164 (20) Net realized (gains) losses on Fortitude Re funds withheld embedded derivatives (22) 1,025 Subtotal - Fortitude Re related items (190) 611 Other non-Fortitude Re reconciling items: Changes in fair value of securities used to hedge guaranteed living benefits (18) (13) Other (income) - net (6) (10) Net realized (gains) losses* 231 513 Subtotal - Other non-Fortitude Re reconciling items 207 490 Total adjustments 17 1,101 Adjusted revenues $ 5,853 $ 5,363 * Represents all Net realized gains and losses except gains (losses) related to the disposition of real estate investments and earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedging or for asset replication. Earned income for non-qualifying (economic) hedging or for asset replication is reclassified from Net realized gains and losses to specific APTOI line items (e.g., net investment income and interest credited to policyholder account balances) based on the economic risk being hedged. Adjusted pre-tax operating income (“APTOI”) is derived by excluding the items set forth below from income from operations before income tax. These items generally fall into one or more of the following broad categories: legacy matters having no relevance to our current businesses or operating performance; adjustments to enhance transparency to the underlying economics of transactions; and recording adjustments to APTOI that we believe to be common in our industry. We believe the adjustments to pre-tax income are useful for gaining an understanding of our overall results of operations. APTOI excludes the impact of the following items: FORTITUDE RE RELATED ADJUSTMENTS: The modified coinsurance (“modco”) reinsurance agreements with Fortitude Re transfer the economics of the invested assets supporting the reinsurance agreements to Fortitude Re. Accordingly, the net investment income on Fortitude Re funds withheld assets and the net realized gains (losses) on Fortitude Re funds withheld assets are excluded from APTOI. Similarly, changes in the Fortitude Re funds withheld embedded derivative are also excluded from APTOI. The ongoing results associated with the reinsurance agreement with Fortitude Re have been excluded from APTOI as these are not indicative of our ongoing business operations. Corebridge | First Quarter 2024 Form 10-Q 81 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics INVESTMENT RELATED ADJUSTMENTS: APTOI excludes “Net realized gains (losses)”, except for gains (losses) related to the disposition of real estate investments. Net realized gains (losses), except for gains (losses) related to the disposition of real estate investments, are excluded as the timing of sales on invested assets or changes in allowances depend largely on market credit cycles and can vary considerably across periods. In addition, changes in interest rates may create opportunistic scenarios to buy or sell invested assets. Our derivative results, including those used to economically hedge insurance liabilities or are recognized as embedded derivatives at fair value are also included in Net realized gains (losses) and are similarly excluded from APTOI except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedges or for asset replication. Earned income on such economic hedges is reclassified from Net realized gains and losses to specific APTOI line items based on the economic risk being hedged (e.g., Net investment income and Interest credited to policyholder account balances). MARKET RISK BENEFIT ADJUSTMENTS: Certain of our variable annuity, fixed annuity and fixed index annuity contracts contain GMWBs and/or GMDBs which are accounted for as MRBs. Changes in the fair value of these MRBs (excluding changes related to our own credit risk), including certain rider fees attributed to the MRBs, along with changes in the fair value of derivatives used to hedge MRBs are recorded through “Change in the fair value of MRBs, net” and are excluded from APTOI. Changes in the fair value of securities used to economically hedge MRBs are excluded from APTOI. OTHER ADJUSTMENTS: Other adjustments represent all other adjustments that are excluded from APTOI and includes the net pre-tax operating income (losses) from noncontrolling interests related to consolidated investment entities. The excluded adjustments include, as applicable: • restructuring and other costs related to initiatives designed to reduce operating expenses, improve efficiency and simplify our organization; • non-recurring costs associated with the implementation of non-ordinary course legal or regulatory changes or changes to accounting principles; • separation costs; • non-operating litigation reserves and settlements; • loss (gain) on extinguishment of debt, if any; • losses from the impairment of goodwill, if any; and • income and loss from divested or run-off business, if any. Adjusted after-tax operating income attributable to our common shareholders (“Adjusted After-tax Operating Income” or “AATOI”) is derived by excluding the tax effected APTOI adjustments described above, as well as the following tax items from net income attributable to us: • reclassifications of disproportionate tax effects from AOCI, changes in uncertain tax positions and other tax items related to legacy matters having no relevance to our current businesses or operating performance; and • deferred income tax valuation allowance releases and charges. Corebridge | First Quarter 2024 Form 10-Q 82 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics The following tables present a reconciliation of pre-tax income (loss)/net income (loss) attributable to Corebridge to adjusted pre-tax operating income (loss)/adjusted after-tax operating income (loss) attributable to Corebridge: Three Months Ended March 31, 2024 2023 (in millions) Pre-tax Total Tax (Benefit) Charge Non- controlling Interests After Tax Pre-tax Total Tax (Benefit) Charge Non- controlling Interests After Tax Pre-tax income/net income, including noncontrolling interests $ 1,016 $ 189 $ — $ 827 $ (669) $ (216) $ — $ (453) Noncontrolling interests — — 51 51 — — (6) (6) Pre-tax income/net income attributable to Corebridge 1,016 189 51 878 (669) (216) (6) (459) Fortitude Re related items Net investment (income) on Fortitude Re funds withheld assets (332) (71) — (261) (394) (87) — (307) Net realized (gains) losses on Fortitude Re funds withheld assets 164 35 — 129 (20) (4) — (16) Net realized (gains) losses on Fortitude Re funds withheld embedded derivative (22) (5) — (17) 1,025 227 — 798 Subtotal Fortitude Re related items (190) (41) — (149) 611 136 — 475 Other reconciling items Reclassification of disproportionate tax effects from AOCI and other tax adjustments — 26 — (26) — 21 — (21) Deferred income tax valuation allowance (releases) charges — (17) — 17 — (16) — 16 Changes in fair value of market risk benefits, net (369) (77) — (292) 196 41 — 155 Changes in fair value of securities used to hedge guaranteed living benefits 1 — — 1 3 1 — 2 Changes in benefit reserves related to net realized gains (losses) (3) (1) — (2) (5) (1) — (4) Net realized (gains) losses * 222 47 — 175 508 107 — 401 Separation costs 67 14 — 53 52 11 — 41 Restructuring and other costs 47 10 — 37 27 6 — 21 Non-recurring costs related to regulatory or accounting changes — — — — 4 1 — 3 Net (gain) loss on divestiture (5) (1) — (4) 3 1 — 2 Noncontrolling interests 51 — (51) — (6) — 6 — Subtotal: Other non-Fortitude Re reconciling items 11 1 (51) (41) 782 172 6 616 Total adjustments (179) (40) (51) (190) 1,393 308 6 1,091 Adjusted pre-tax operating income/Adjusted after-tax operating income attributable to Corebridge $ 837 $ 149 $ — $ 688 $ 724 $ 92 $ — $ 632 * Includes all net realized gains and losses except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedging or for asset replication. Additionally, gains (losses) related to the disposition of real estate investments are also excluded from this adjustment. Adjusted Book Value is derived by excluding AOCI, adjusted for the cumulative unrealized gains and losses related to Fortitude Re’s funds withheld assets. We believe this measure is useful to investors as it eliminates the asymmetrical impact resulting from changes in fair value of our available-for-sale securities portfolio for which there is largely no offsetting impact for certain related insurance liabilities that are not recorded at fair value with changes in fair value recorded through OCI. It also eliminates asymmetrical impacts where our own credit non-performance risk is recorded through OCI. In addition, we adjust for the cumulative unrealized gains and losses related to Fortitude Re’s funds withheld assets since these fair value movements are economically transferred to Fortitude Re . The following table presents the reconciliation of Book value per common share to Adjusted book value per common share: At March 31, At December 31, (in millions, except per common share data) 2024 2023 Total Corebridge shareholders' equity (a) $ 11,576 $ 11,766 Less: Accumulated other comprehensive income (loss) (14,139) (13,458) Add: Cumulative unrealized gains and losses related to Fortitude Re funds withheld assets (2,497) (2,332) Adjusted Book Value (b) $ 23,218 $ 22,892 Total common shares outstanding (c) 615.4 621.7 Book value per common share (a/c) $ 18.81 $ 18.93 Adjusted book value per common share (b/c) $ 37.73 $ 36.82 Corebridge | First Quarter 2024 Form 10-Q 83 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics Adjusted Return on Average Equity (“Adjusted ROAE”) is derived by dividing AATOI by average Adjusted Book Value and is used by management to evaluate our recurring profitability and evaluate trends in our business. We believe this measure is useful to investors as it eliminates the asymmetrical impact resulting from changes in fair value of our available-for-sale securities portfolio for which there is largely no offsetting impact for certain related insurance liabilities that are not recorded at fair value with changes in fair value recorded through OCI. It also eliminates asymmetrical impacts where our own credit non-performance risk is recorded through OCI. In addition, we adjust for the cumulative unrealized gains and losses related to Fortitude Re’s funds withheld assets since these fair value movements are economically transferred to Fortitude Re. The following table presents the reconciliation of Adjusted ROAE: Three Months Ended March 31, (in millions, unless otherwise noted) 2024 2023 Actual or annualized net income (loss) attributable to Corebridge shareholders (a) $ 3,512 $ (1,836) Actual or annualized adjusted after-tax operating income attributable to Corebridge shareholders (b) 2,752 2,528 Average Corebridge shareholders’ equity (c) 11,671 10,468 Less: Average AOCI (13,799) (15,465) Add: Average cumulative unrealized gains and losses related to Fortitude Re funds withheld assets (2,415) (2,586) Average Adjusted Book Value (d) $ 23,055 $ 23,347 Return on Average Equity (a/c) 30.1 % (17.5)% Adjusted ROAE (b/d) 11.9 % 10.8% Premiums and deposits is a non-GAAP financial measure that includes direct and assumed premiums received and earned on traditional life insurance policies and life-contingent payout annuities, as well as deposits received on universal life insurance, investment-type annuity contracts and GICs. We believe the measure of premiums and deposits is useful in understanding customer demand for our products, evolving product trends and our sales performance period over period. The following table presents the premiums and deposits: Three Months Ended March 31, (in millions) 2024 2023 Individual Retirement Premiums $ 41 $ 78 Deposits 4,822 4,807 Other (a) (2) (2) Premiums and deposits 4,861 4,883 Group Retirement Premiums 5 6 Deposits 2,049 2,240 Premiums and deposits (b)(c) 2,054 2,246 Life Insurance Premiums 434 425 Deposits 393 398 Other (a) 267 226 Premiums and deposits 1,094 1,049 Institutional Markets Premiums 1,796 1,575 Deposits 781 581 Other (a) 9 7 Premiums and deposits 2,586 2,163 Total Premiums 2,276 2,084 Deposits 8,045 8,026 Other (a) 274 231 Premiums and deposits $ 10,595 $ 10,341 (a) Other principally consists of ceded premiums, in order to reflect gross premiums and deposits. (b) Excludes client deposits into advisory and brokerage accounts of $730 million and $542 million for the three months ended March 31, 2024 and 2023, respectively. (c) Includes inflows related to in-plan mutual funds of $791 million and $1.0 billion for the three months ended March 31, 2024 and 2023, respectively. Corebridge | First Quarter 2024 Form 10-Q 84 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics Net investment income (APTOI basis) is the sum of base portfolio income and variable investment income. The following table presents a reconciliation of net investment income (net income basis) to net investment income (APTOI basis): Three Months Ended March 31, (in millions) 2024 2023 Net investment income (net income basis) $ 2,924 $ 2,695 Net investment (income) on Fortitude Re funds withheld assets (332) (394) Change in fair value of securities used to hedge guaranteed living benefits (18) (13) Other adjustments (6) (10) Derivative income recorded in net realized gains (losses) 61 57 Total adjustments (295) (360) Net investment income (APTOI basis) $ 2,629 $ 2,335 KEY OPERATING METRICS Assets Under Management and Administration Assets Under Management (“AUM”) include assets in the general and separate accounts of our subsidiaries that support liabilities and surplus related to our life and annuity insurance products. Assets Under Administration (“AUA”) include Group Retirement mutual fund assets and other third-party assets that we sell or administer and the notional value of SVW contracts. Assets Under Management and Administration (“AUMA”) is the cumulative amount of AUM and AUA. The following table presents a summary of our AUMA: March 31, December 31, (in millions) 2024 2023 Individual Retirement AUM $ 153,065 $ 149,691 AUA — — Total Individual Retirement AUMA 153,065 149,691 Group Retirement AUM 81,509 79,910 AUA 44,706 42,271 Total Group Retirement AUMA 126,215 122,181 Life Insurance AUM 26,989 26,691 AUA — — Total Life Insurance AUMA * 26,989 26,691 Institutional Markets AUM 43,276 40,678 AUA 43,168 44,607 Total Institutional Markets AUMA 86,444 85,285 Total AUMA $ 392,713 $ 383,848 * The March 31, 2024 and December 31, 2023 AUMA excludes $184 million and $181 million, respectively, of assets that were reclassified to Assets held-for-sale in the Condensed Consolidated Balance Sheets. See Note 4 to the Condensed Consolidated Financial Statements for additional information. Corebridge | First Quarter 2024 Form 10-Q 85 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics Fee and Spread income and Underwriting Margin Fee income is defined as policy fees plus advisory fees plus other fee income. For our Institutional Markets segment, its SVW products generate fee income. Spread income is defined as net investment income less interest credited to policyholder account balances, exclusive of amortization of deferred sales inducement assets. Spread income is comprised of both base spread income and variable investment income. For our Institutional Markets segment, its structured settlements, PRT and GIC products generate spread income, which includes premiums, net investment income, less interest credited and policyholder benefits and excludes the annual assumption update. Underwriting margin for our Life Insurance segment includes premiums, policy fees, other income, net investment income, less interest credited to policyholder account balances and policyholder benefits and excludes the annual assumption update. For our Institutional Markets segment, its Corporate Markets products generate underwriting margin, which includes premiums, net investment income, policy and advisory fee income, less interest credited and policyholder benefits and excludes the annual assumption update. Base portfolio income includes interest, dividends and foreclosed real estate income, net of investment expenses and non-qualifying (economic) hedges. Variable investment income includes call and tender income, commercial mortgage loan prepayments, changes in market value of investments accounted for under the fair value option, interest received on defaulted investments (other than foreclosed real estate), income from alternative investments and other miscellaneous investment income, including income of certain partnership entities that are required to be consolidated. Alternative investments include private equity funds which are generally reported on a one-quarter lag. Base spread income means base portfolio income less interest credited to policyholder account balances, excluding the amortization of deferred sales inducement assets. Base net investment spread means base yield less cost of funds, excluding the amortization of deferred sales inducement assets. Base yield means the returns from base portfolio income including accretion and impacts from holding cash and short-term investments. The following table presents a summary of our spread income, fee income and underwriting margin: Three Months Ended March 31, (in millions) 2024 2023 Individual Retirement Spread income $ 713 $ 623 Fee income 307 277 Total Individual Retirement* 1,020 900 Group Retirement Spread income 200 213 Fee income 190 176 Total Group Retirement 390 389 Life Insurance Underwriting margin 297 356 Total Life Insurance 297 356 Institutional Markets Spread income 106 82 Fee income 16 16 Underwriting margin 18 17 Total Institutional Markets 140 115 Total Spread income 1,019 918 Fee income 513 469 Underwriting margin 315 373 Total $ 1,847 $ 1,760 Corebridge | First Quarter 2024 Form 10-Q 86 TABLE OF CONTENTS ITEM 2 | Use of Non-GAAP Financial Measures and Key Operating Metrics Net Investment Income (APTOI Basis) The following table presents a summary of our four insurance operating businesses’ net investment income on an APTOI basis: Three Months Ended March 31, (in millions) 2024 2023 Individual Retirement Base portfolio income $ 1,335 $ 1,123 Variable investment income 4 5 Net investment income 1,339 1,128 Group Retirement Base portfolio income 494 491 Variable investment income 1 9 Net investment income 495 500 Life Insurance Base portfolio income 327 317 Variable investment income (1) — Net investment income 326 317 Institutional Markets Base portfolio income 489 318 Variable investment income (2) 14 Net investment income 487 332 Total Base portfolio income 2,645 2,249 Variable investment income 2 28 Net investment income (APTOI basis) - Insurance operations $ 2,647 $ 2,277 Net Flows Net flows for annuity products in Individual Retirement and Group Retirement represent premiums and deposits less death, surrender and other withdrawal benefits. Net flows for mutual funds represent deposits less withdrawals. For Group Retirement, client deposits into advisory and brokerage accounts less total client withdrawals from advisory and brokerage accounts are not included in net flows. The following table presents a summary of our Net Flows: Three Months Ended March 31, (in millions) 2024 2023 Individual Retirement Fixed Annuities $ (211) $ (90) Fixed Index Annuities 925 1,388 Variable Annuities (1,228) (636) Total Individual Retirement (514) 662 Group Retirement (1,891) (819) Total Net Flows $ (2,405) $ (157) Corebridge | First Quarter 2024 Form 10-Q 87 TABLE OF CONTENTS ITEM 2 Consolidated Results of Operations Consolidated Results of Operations The following section provides a comparative discussion of our consolidated results of operations on a reported basis for the three months ended March 31, 2024 and 2023. For factors that relate primarily to a specific business, see “— Business Segment Operations .” Three Months Ended March 31, (in millions) 2024 2023 Revenues: Premiums $ 2,295 $ 2,105 Policy fees 714 698 Net investment income 2,924 2,695 Net realized losses (320) (1,458) Advisory fee and other income 223 222 Total revenues 5,836 4,262 Benefits and expenses: Policyholder benefits 2,807 2,495 Change in the fair value of market risk benefits, net (369) 196 Interest credited to policyholder account balances 1,199 1,026 Amortization of deferred policy acquisition costs and value of business acquired 267 256 Non-deferrable insurance commissions 143 136 Advisory fee expenses 68 65 General operating expenses 572 582 Interest expense 138 172 Net (gain) loss on divestitures (5) 3 Total benefits and expenses 4,820 4,931 Income (loss) before income tax expense (benefit) 1,016 (669) Income tax expense (benefit) 189 (216) Net income (loss) 827 (453) Less: Net income (loss) attributable to noncontrolling interests (51) 6 Net income (loss) attributable to Corebridge $ 878 $ (459) The following table presents certain balance sheet data: (in millions, except per common share data) March 31, 2024 December 31, 2023 Balance sheet data: Total assets $ 385,588 $ 379,270 Long-term debt $ 9,118 $ 9,118 Debt of consolidated investment entities $ 2,530 $ 2,504 Total Corebridge shareholders’ equity $ 11,576 $ 11,766 Book value per common share $ 18.81 $ 18.93 Adjusted book value per common share $ 37.73 $ 36.82 Financial Highlights Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Net Income Comparison Income (loss) before income tax expense (benefit) We recorded pre-tax income of $1.0 billion in the three months ended March 31, 2024 compared to pre-tax loss of $669 million in the three months ended March 31, 2023. The change in pre-tax income was primarily due to: • lower net realized losses of $1.1 billion primarily driven by lower losses on the Fortitude Re funds withheld embedded derivative and withheld assets; • favorable change in the fair value of market risk benefits, net of $565 million primarily driven by the impacts of changes in equity markets and interest rate volatility; • higher net investment income of $229 million primarily driven by higher base portfolio income partially offset by lower income related to the Fortitude Re funds withheld assets and lower variable investment income; and Corebridge | First Quarter 2024 Form 10-Q 88 TABLE OF CONTENTS ITEM 2 Consolidated Results of Operations • higher premiums of $190 million primarily on new pension risk transfer business. Partially offset by: • higher policyholder benefits of $312 million primarily on new pension risk transfer business; and • higher interest credited to policyholder account balances of $173 million primarily due to higher sales activity in fixed and fixed index annuities and increased interest rates on the growing GIC business. Income tax expense (benefit) For the three months ended March 31, 2024, there was an income tax expense of $189 million on income from operations, resulting in an effective tax rate on income from operations of 18.6%. Adjusted pre-tax operating income The following table presents total Corebridge’s adjusted pre-tax operating income: Three Months Ended March 31, (in millions) 2024 2023 Premiums $ 2,295 $ 2,104 Policy fees 714 698 Net investment income 2,629 2,335 Net realized gains (losses)* (8) 4 Advisory fee and other income 223 222 Total adjusted revenues 5,853 5,363 Policyholder benefits 2,810 2,500 Interest credited to policyholder account balances 1,189 1,015 Amortization of deferred policy acquisition costs 267 256 Non-deferrable insurance commissions 143 136 Advisory fee expenses 68 65 General operating expenses 458 499 Interest expense 132 162 Total benefits and expenses 5,067 4,633 Noncontrolling interests 51 (6) Adjusted pre-tax operating income $ 837 $ 724 * Net realized gains (losses) includes the gains (losses) related to the disposition of real estate investments. Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 APTOI Comparison APTOI increased $113 million, primarily due to: • higher net investment income of $294 million primarily driven by higher base portfolio income partially offset by lower variable investment income reflecting lower alternative investment income; • higher premiums of $191 million primarily on new pension risk transfer business; • lower general operating expenses by $41 million; and • lower interest expense of $30 million primarily due to lower interest expense on consolidated investment entities. Partially offset by: • higher policyholder benefits of $310 million primarily on new pension risk transfer business; and • higher interest credited to policyholder account balances of $174 million primarily due to higher sales activity in fixed and fixed index annuities and increased interest rates on the growing GIC business. Corebridge | First Quarter 2024 Form 10-Q 89 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Business Segment Operations Our business operations consist of five reportable segments: • Individual Retirement – consists of fixed annuities, fixed index annuities and variable annuities. • Group Retirement – consists of recordkeeping, plan administrative and compliance services, financial planning and advisory solutions offered in-plan, along with proprietary and limited non-proprietary annuities, advisory and brokerage products offered out-of-plan. • Life Insurance – primary products in the United States include term life and universal life insurance. The International Life business issues individual and group life insurance in the United Kingdom and distributed private medical insurance in Ireland. On October 31, 2023 Corebridge completed the sale of Laya and on April 8, 2024 completed the sale of AIG Life. • Institutional Markets – consists of SVW products, structured settlement and PRT annuities, Corporate Markets products that include corporate- and bank-owned life insurance (“COLI-BOLI”), private placement variable universal life and private placement variable annuities products and GICs. • Corporate and Other – consists primarily of: – corporate expenses not attributable to our other segments; – interest expense on financial debt; – results of our consolidated investment entities; – institutional asset management business, which includes managing assets for non-consolidated affiliates; and – results of our legacy insurance lines ceded to Fortitude Re. The following tables summarize adjusted pre-tax operating income (loss) from our segments: See Note 3 to the Condensed Consolidated Financial Statements. Three Months Ended March 31, (in millions) 2024 2023 Individual Retirement $ 622 $ 534 Group Retirement 200 186 Life Insurance 54 82 Institutional Markets 112 85 Corporate and Other (148) (163) Consolidation and elimination (3) — Adjusted pre-tax operating income $ 837 $ 724 Corebridge | First Quarter 2024 Form 10-Q 90 TABLE OF CONTENTS ITEM 2 | Business Segment Operations DISCUSSION OF SEGMENT RESULTS Individual Retirement Individual Retirement Results Three Months Ended March 31, (in millions) 2024 2023 Revenues: Premiums $ 41 $ 78 Policy fees 191 174 Net investment income: Base portfolio income 1,335 1,123 Variable investment income 4 5 Net investment income 1,339 1,128 Advisory fee and other income* 116 103 Total adjusted revenues 1,687 1,483 Benefits and expenses: Policyholder benefits 36 65 Interest credited to policyholder account balances 639 519 Amortization of deferred policy acquisition costs 149 137 Non-deferrable insurance commissions 90 86 Advisory fee expenses 35 34 General operating expenses 116 108 Total benefits and expenses 1,065 949 Adjusted pre-tax operating income $ 622 $ 534 * Includes advisory fee income from registered investment services, 12b-1 fees (i.e., marketing and distribution fee income), and other asset management fee income. Individual Retirement Sources of Earnings The following table presents the sources of earnings of the Individual Retirement segment. We believe providing APTOI using this view is useful for gaining an understanding of our overall results of operations and the significant drivers of our earnings: Three Months Ended March 31, (in millions) 2024 2023 Spread income (a) $ 713 $ 623 Fee income 307 277 Policyholder benefits, net of premiums 5 13 Non-deferrable insurance commissions (90) (86) Amortization of DAC and DSI (162) (151) General operating expenses (116) (108) Other (b) (35) (34) Adjusted pre-tax operating income $ 622 $ 534 (a) Spread income represents net investment income less interest credited to policyholder account balances, exclusive of amortization of DSI of $13 million and $14 million for the three months ended March 31, 2024 and 2023 respectively. (b) Other represents advisory fee expenses. Financial Highlights Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 APTOI Comparison APTOI increased $88 million, primarily due to: • higher spread income of $90 million driven by higher base spread income of $91 million due to improved base portfolio yields and growth in invested assets driven by higher general account sales. Corebridge | First Quarter 2024 Form 10-Q 91 TABLE OF CONTENTS ITEM 2 | Business Segment Operations AUMA The following table presents Individual Retirement AUMA by product: March 31, December 31, (in millions) 2024 2023 Fixed annuities $ 53,244 $ 53,570 Fixed index annuities 43,004 40,661 Variable annuities: Variable annuities - General Account 7,035 7,715 Variable annuities - Separate Accounts 49,782 47,745 Variable annuities 56,817 55,460 Total $ 153,065 $ 149,691 March 31, 2024 to December 31, 2023 AUMA Comparison AUMA increased $3.4 billion driven by higher separate accounts asset values of $2.0 billion and an increase of $1.3 billion in the general account. The separate account increased primarily due to increases in the equity markets, partially offset by outflows from separate accounts. The general account increased primarily due to positive general account net flows and income. Spread and Fee Income The following table presents Individual Retirement spread and fee income: Three Months Ended March 31, (in millions) 2024 2023 Spread income: Total spread income Base portfolio income $ 1,335 $ 1,123 Interest credited to policyholder account balances (626) (505) Base spread income 709 618 Variable investment income 4 5 Total spread income* $ 713 $ 623 Fee income: Policy fees $ 191 $ 174 Advisory fees and other income 116 103 Total fee income $ 307 $ 277 * Excludes amortization of DSI assets of $13 million and $14 million for the three months ended March 31, 2024 and 2023, respectively. Corebridge | First Quarter 2024 Form 10-Q 92 TABLE OF CONTENTS ITEM 2 | Business Segment Operations The following table presents Individual Retirement net investment spread: Three Months Ended March 31, 2024 2023 Fixed annuities base net investment spread: Base yield* 5.33 % 4.83 % Cost of funds 3.18 2.82 Fixed annuities base net investment spread 2.15 2.01 Fixed index annuities base net investment spread: Base yield* 5.10 4.46 Cost of funds 2.30 1.79 Fixed index annuities base net investment spread 2.80 2.67 Variable annuities base net investment spread: Base yield* 3.66 3.85 Cost of funds 1.49 1.46 Variable annuities base net investment spread 2.17 2.39 Total Individual Retirement base net investment spread: Base yield* 5.14 4.65 Cost of funds 2.70 2.34 Total Individual Retirement base net investment spread 2.44 % 2.31 % * Includes returns from base portfolio including accretion and income (loss) from certain other invested assets. Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison See “Financial Highlights.” Premiums and Deposits and Net Flows For Individual Retirement, premiums primarily represent amounts received on life-contingent payout annuities, while deposits represent sales on investment-oriented products. Net flows for annuity products in Individual Retirement represent premiums and deposits less death, surrender and other withdrawal benefits. Premiums and Deposits Three Months Ended March 31, (in millions) 2024 2023 Fixed annuities $ 2,612 $ 2,248 Fixed index annuities 1,883 2,057 Variable annuities 366 578 Total $ 4,861 $ 4,883 Net Flows Three Months Ended March 31, (in millions) 2024 2023 Fixed annuities $ (211) $ (90) Fixed index annuities 925 1,388 Variable annuities (1,228) (636) Total $ (514) $ 662 Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison Fixed Annuities Net outflows increased by $121 million over the prior year, primarily due to higher surrenders and withdrawals of $687 million, partially offset by higher premiums and deposits of $364 million due to strong sales execution as interest rates rose and lower death benefits of $201 million. Fixed Index Annuities Net inflows decreased by $463 million primarily due to lower premiums and deposits of $174 million, higher surrenders and withdrawals of $270 million and higher death benefits of $21 million. Variable Annuities Net outflows increased $592 million primarily due to lower premium and deposits of $212 million due to market volatility and higher surrenders and withdrawals of $364 million and higher death benefits of $15 million. Corebridge | First Quarter 2024 Form 10-Q 93 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Surrenders The following table presents Individual Retirement surrender rates: Three Months Ended March 31, 2024 2023 Fixed annuities 20.6 % 15.1 % Fixed index annuities 8.0 6.7 Variable annuities 9.4 7.1 The following table presents account values for fixed annuities, fixed index annuities and variable annuities by surrender charge category: March 31, December 31, 2024 2023 (in millions) Fixed Annuities Fixed Index Annuities Variable Annuities Fixed Annuities Fixed Index Annuities Variable Annuities No surrender charge $ 20,884 $ 1,905 $ 31,352 $ 21,793 $ 1,727 $ 29,819 Greater than 0% - 2% 859 3,545 6,889 1,023 3,326 6,717 Greater than 2% - 4% 2,784 6,498 6,284 2,844 6,413 5,799 Greater than 4% 23,116 28,965 10,737 21,766 28,128 11,014 Non-surrenderable (a) 2,464 — 1,156 2,474 — 1,156 Total account value (b) $ 50,107 $ 40,913 $ 56,418 $ 49,900 $ 39,594 $ 54,505 (a) The non-surrenderable portion of variable annuities relates to funding agreements. (b) Includes payout Immediate Annuities and funding agreements. Individual Retirement annuities are typically subject to a three- to ten-year surrender charge period, depending on the product. For fixed annuities, the proportion of account value subject to surrender charge at March 31, 2024 increased compared to December 31, 2023 primarily due to growth in the business. For fixed index annuities, the proportion of account value subject to surrender charge at March 31, 2024 was flat to December 31, 2023. The increase in the proportion of account value with no surrender charge for variable annuities as of March 31, 2024 compared to December 31, 2023 was principally due to normal aging of the business. Group Retirement Group Retirement Results Three Months Ended March 31, (in millions) 2024 2023 Revenues: Premiums $ 5 $ 6 Policy fees 107 100 Net investment income: Base portfolio income 494 491 Variable investment income 1 9 Net investment income 495 500 Advisory fee and other income* 83 76 Total adjusted revenues 690 682 Benefits and expenses: Policyholder benefits 3 9 Interest credited to policyholder account balances 298 291 Amortization of deferred policy acquisition costs 21 21 Non-deferrable insurance commissions 29 28 Advisory fee expenses 33 29 General operating expenses 106 118 Total benefits and expenses 490 496 Adjusted pre-tax operating income $ 200 $ 186 * Includes advisory fee income from registered investment services, 12b-1 fees (i.e., marketing and distribution fee income), other asset management fee income, and commission-based broker-dealer services. Corebridge | First Quarter 2024 Form 10-Q 94 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Group Retirement Sources of Earnings The following table presents the sources of earnings of the Group Retirement segment. We believe providing APTOI using this view is useful for gaining an understanding of our overall results of operations and the significant drivers of our earnings: Three Months Ended March 31, (in millions) 2024 2023 Spread income (a) $ 200 $ 213 Fee income (b) 190 176 Policyholder benefits, net of premiums 2 (3) Non-deferrable insurance commissions (29) (28) Amortization of DAC and DSI (24) (25) General operating expenses (106) (118) Other (c) (33) (29) Adjusted pre-tax operating income $ 200 $ 186 (a) Spread income represents net investment income less interest credited to policyholder account balances, exclusive of amortization of DSI of $3 million and $4 million for the three months ended March 31, 2024 and 2023, respectively. (b) Fee income represents policy fee and advisory fee and other income. (c) Other consists of advisory fee expenses. Financial Highlights Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 APTOI Comparison APTOI increased $14 million, primarily due to: • lower general operating expenses of $12 million; and • higher fee income, net of advisory fee expenses of $10 million due to higher average separate account, advisory, and mutual fund assets driven by improved equity market performance. Partially offset by: • lower spread income of $13 million primarily driven by a decrease in variable investment income of $8 million. AUMA The following table presents Group Retirement AUMA by product: March 31, December 31, (in millions) 2024 2023 AUMA by asset type: In-plan spread based $ 24,619 $ 25,160 In-plan fee based 58,002 54,807 Total in-plan AUMA (a) 82,621 79,967 Out-of-plan proprietary - General Account 16,925 16,664 Out-of-plan proprietary - Separate Accounts 11,432 11,075 Total out-of-plan proprietary annuities 28,357 27,739 Advisory and brokerage assets 15,237 14,475 Total out-of-plan AUMA (b) 43,594 42,214 Total AUMA $ 126,215 $ 122,181 (a) Includes $13.5 billion of AUMA at March 31, 2024 and $12.7 billion of AUMA at December 31, 2023 that is associated with our in-plan investment advisory service that we offer to participants at an additional fee. (b) Includes $12.6 billion of AUMA at March 31, 2024 and $12.0 billion of AUMA at December 31, 2023 that is associated with our out-of-plan investment advisory service that we offer to customers at an additional fee. March 31, 2024 to December 31, 2023 AUMA Comparison In-plan assets increased by $2.7 billion driven by $3.2 billion increase in fee based assets, primarily due to higher equity markets. partially offset by $541 million decrease in spread based assets, primarily due to negative net flows, Out-of-plan proprietary annuity assets increased by $618 million, primarily due to higher equity markets. The increase of advisory and brokerage assets of $762 million was driven by higher equity markets and net new assets. Corebridge | First Quarter 2024 Form 10-Q 95 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Spread and Fee Income The following table presents Group Retirement spread and fee income: Three Months Ended March 31, (in millions) 2024 2023 Spread income: Base portfolio income $ 494 $ 491 Interest credited to policyholder account balances (295) (287) Base spread income 199 204 Variable investment income 1 9 Total spread income* $ 200 $ 213 Fee income: Policy fees $ 107 $ 100 Advisory fees and other income 83 76 Total fee income $ 190 $ 176 * Spread income represents net investment income less interest credited to policyholder account balances, exclusive of amortization of DSI of $3 million and $4 million for the three months ended March 31, 2024 and 2023, respectively. Three Months Ended March 31, 2024 2023 Base net investment spread: Base yield* 4.42 % 4.22 % Cost of funds 2.89 2.70 Base net investment spread 1.53 % 1.52 % * Includes returns from base portfolio, including accretion and income (loss) from certain other invested assets. Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison See “Financial Highlights.” Premiums and Deposits and Net Flows For Group Retirement, premiums primarily represent amounts received on life-contingent payout annuities while deposits represent sales on investment-oriented products. Net flows for annuity products included in Group Retirement represent premiums and deposits less death, surrender and other withdrawal benefits. Net flows for mutual funds represent deposits less withdrawals. For Group Retirement, client deposits into advisory and brokerage accounts less total client withdrawals from advisory and brokerage accounts are not included in net flows. Net new assets into these products contribute to growth in AUA rather than AUM. Premiums and Deposits and Net Flows Three Months Ended March 31, (in millions) 2024 2023 In-plan (a)(b) $ 1,250 $ 1,519 Out-of-plan proprietary variable annuity 153 192 Out-of-plan proprietary fixed and index annuities 651 535 Premiums and deposits (c) $ 2,054 $ 2,246 Net Flows $ (1,891) $ (819) (a) In-plan premium and deposits include sales of variable and fixed annuities as well as mutual funds for 403(b), 401(a), 457(b) and 401(k) plans. (b) Includes inflows related to in-plan mutual funds of $791 million and $1.0 billion for the three months ended March 31, 2024 and 2023, respectively. (c) Excludes client deposits into advisory and brokerage accounts of $730 million and $542 million for the three months ended March 31, 2024 and 2023, respectively. Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison Net flows remained negative and declined by $1.1 billion primarily due to an increase in surrenders and withdrawals of $862 million, a decrease in deposits of $192 million and an increase in death and payout benefit annuity benefits of $18 million. Large plan acquisitions and surrenders resulted in lower net flows of $459 million compared to the prior year. Excluding large plan acquisitions and surrenders, net outflows were concentrated in higher contractual guaranteed minimum crediting rates. Corebridge | First Quarter 2024 Form 10-Q 96 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Surrenders The following table presents Group Retirement surrender rates: Three Months Ended March 31, 2024 2023 Surrender rates 13.6 % 11.0 % The following table presents account value for Group Retirement annuities by surrender charge category: March 31, December 31, (in millions) 2024 (a) 2023 (a) No surrender charge (b) $ 71,578 $ 70,500 Greater than 0% - 2% 1,274 1,251 Greater than 2% - 4% 1,629 1,698 Greater than 4% 6,197 5,757 Non-surrenderable 486 490 Total account value (c) $ 81,164 $ 79,696 (a) Excludes mutual fund assets under administration o f $29.5 billion and $27.8 billion at March 31, 2024 and December 31, 2023, respectively. (b) Group Retirement amounts in this category include account value in the general account of approximate ly $4.0 billion a nd $4.1 billion at March 31, 2024 and December 31, 2023, respectively, which are subject to 20% annual withdrawal limitations at the participant level and account value in the general account of $5.2 billion a nd $5.3 billion at March 31, 2024 and December 31, 2023, respectively, which are subject to 20% an nual withdrawal limitations at the plan level. (c) Includes payout Immediate Annuities and funding agreements. Group Retirement annuity deposits are typically subject to a four- to seven-year surrender charge period, depending on the product. In addition, for annuity assets held within an employer defined contribution plan, participants can only withdraw funds in certain circumstances without incurring tax penalties (for example, separation from service), regardless of surrender charges. At March 31, 2024, Group Retirement annuity account values with no surrender charge increased compared to December 31, 2023 primarily due to an increase in assets under management from higher equity markets partially offset by negative net flows. Life Insurance Life Insurance Results Three Months Ended March 31, (in millions) 2024 2023 Revenues: Premiums $ 434 $ 425 Policy fees 368 375 Net investment income: Base portfolio income 327 317 Variable investment income (loss) (1) — Net investment income 326 317 Other income — 29 Total adjusted revenues 1,128 1,146 Benefits and expenses: Policyholder benefits 748 708 Interest credited to policyholder account balances 83 82 Amortization of deferred policy acquisition costs 94 96 Non-deferrable insurance commissions 19 17 Advisory fee expenses — 2 General operating expenses 130 159 Total benefits and expenses 1,074 1,064 Adjusted pre-tax operating income $ 54 $ 82 Corebridge | First Quarter 2024 Form 10-Q 97 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Life Insurance Sources of Earnings The following table presents the sources of earnings of the Life Insurance segment. We believe providing APTOI using this view is useful for gaining an understanding of our overall results of operations and the significant drivers of our earnings: Three Months Ended March 31, (in millions) 2024 2023 Underwriting margin (a) $ 297 $ 356 General operating expenses (130) (159) Non-deferrable insurance commissions (19) (17) Amortization of DAC (94) (96) Other (b) — (2) Adjusted pre-tax operating income $ 54 $ 82 (a) Underwriting margin represents premiums, policy fees, net investment income and other income, less policyholder benefits and interest credited to policyholder account balances. (b) Other primarily represents advisory fee expenses. Financial Highlights Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 APTOI Comparison APTOI decreased $28 million, primarily due to: • lower underwriting margin of $59 million from: – higher policyholder benefits, net of premiums and fees, of $38 million, primarily driven by one-time reinsurance adjustments; and – lower other income of $29 million, primarily driven by the sale of Laya in October 2023 ($27 million). Partially offset by: – higher base portfolio income of $9 million, driven by higher yields. Partially offset by: • lower general operating exp enses of $29 million, primarily driven by the sale of Laya in October 2023 ($20 million). General operating expenses excluding the impact from the sale of Laya decreased $9 million. AUMA The following table presents Life Insurance AUMA: March 31, December 31, (in millions) 2024 2023 Total AUMA $ 26,989 $ 26,691 * AUMA excludes $184 million and $181 million of assets that were reclassified to Assets held-for-sale in the Condensed Consolidated Balance Sheets, at March 31, 2024 and December 31, 2023, respectively . See Note 4 to the Condensed Consolidated Financial Statements for additional information. March 31, 2024 to December 31, 2023 AUMA Comparison AUMA increased $298 million in the three months ended March 31, 2024 compared to the prior year-end d ue to growth in the business. Underwriting Margin The following table presents Life Insurance underwriting margin: Three Months Ended March 31, (in millions) 2024 2023 Premiums $ 434 $ 425 Policy fees 368 375 Net investment income 326 317 Other income — 29 Policyholder benefits (748) (708) Interest credited to policyholder account balances (83) (82) Underwriting margin $ 297 $ 356 Corebridge | First Quarter 2024 Form 10-Q 98 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison See “Financial Highlights.” Premiums and Deposits Premiums and Deposits for Life Insurance represent amounts received on life and health policies. Premiums generally represent amounts received on traditional life products, while deposits represent amounts received on universal life products. Three Months Ended March 31, (in millions) 2024 2023 Traditional Life $ 461 $ 441 Universal Life 393 398 Total U.S. 854 839 International 240 210 Premiums and deposits $ 1,094 $ 1,049 Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison Premiums and deposits, excluding the effect of foreign exchange, increased $37 million for the three months ended March 31, 2024 compared to the prior year primarily due to growth in international life and domestic traditional life premiums. Institutional Markets Institutional Markets Results Three Months Ended March 31, (in millions) 2024 2023 Revenues: Premiums $ 1,796 $ 1,575 Policy fees 48 49 Net investment income: Base portfolio income 489 318 Variable investment income (loss) (2) 14 Net investment income 487 332 Other income 1 — Total adjusted revenues 2,332 1,956 Benefits and expenses: Policyholder benefits 2,023 1,718 Interest credited to policyholder account balances 169 123 Amortization of deferred policy acquisition costs 3 2 Non-deferrable insurance commissions 5 5 General operating expenses 20 23 Total benefits and expenses 2,220 1,871 Adjusted pre-tax operating income $ 112 $ 85 Corebridge | First Quarter 2024 Form 10-Q 99 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Institutional Markets Sources of Earnings The following table presents the sources of earnings of the Institutional Markets segment. We believe providing APTOI using this view is useful for gaining an understanding of our overall results of operations and the significant drivers of our earnings: Three Months Ended March 31, (in millions) 2024 2023 Spread income (a) $ 106 $ 82 Fee income (b) 16 16 Underwriting margin (c) 18 17 Non-deferrable insurance commissions (5) (5) General operating expenses (20) (23) Other (3) (2) Adjusted pre-tax operating income $ 112 $ 85 (a) Represents spread income on GIC, PRT and structured settlement products. (b) Represents fee income on SVW products. (c) Represents underwriting margin from Corporate Markets products, including COLI-BOLI, private placement variable universal life insurance and private placement variable annuity products. Financial Highlights Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 APTOI Comparison APTOI increased $27 million, primarily due to: • higher spread income of $24 million. AUMA The following table presents Institutional Markets AUMA: March 31, December 31, (in millions) 2024 2023 SVW (AUA) $ 43,168 $ 44,607 GIC, PRT and Structured settlements (AUM) 36,041 33,579 All other (AUM) 7,235 7,099 Total AUMA $ 86,444 $ 85,285 March 31, 2024 to December 31, 2023 AUMA Comparison AUMA increased $1.2 billion due to premiums and deposits of $2.6 billion, primarily PRT and GIC products and investment and other activity of $837 million, partially offset by benefit payments on the GIC, PRT and structured settlement products of $531 million and net outflows of $1.7 billion from SVW products. Corebridge | First Quarter 2024 Form 10-Q 100 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Spread Income, Fee Income and Underwriting Margin The following table presents Institutional Markets spread income, fee income and underwriting margin: Three Months Ended March 31, (in millions) 2024 2023 Premiums $ 1,805 $ 1,583 Net investment income 449 298 Policyholder benefits (2,006) (1,702) Interest credited to policyholder account balances (142) (97) Total spread income (a) $ 106 $ 82 SVW fees $ 16 $ 16 Total fee income $ 16 $ 16 Premiums $ (9) $ (8) Policy fees (excluding SVW) 32 33 Net investment income 38 34 Other income 1 — Policyholder benefits (17) (16) Interest credited to policyholder account balances (27) (26) Total underwriting margin (b) $ 18 $ 17 (a) Represents spread income from GIC, PRT and structured settlement products. (b) Represents underwriting margin from Corporate Markets products, including COLI-BOLI, private placement variable universal life insurance and private placement variable annuity products. Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison See “Financial Highlights.” Premiums and Deposits The following table presents the Institutional Markets premiums and deposits: Three Months Ended March 31, (in millions) 2024 2023 PRT $ 1,767 $ 1,528 GICs 600 506 Other * 219 129 Premiums and deposits $ 2,586 $ 2,163 * Other principally consists of structured settlements and Corporate Markets products. Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 Comparison Premiums and deposits increased compared to the prior year period by $423 million, primarily due to higher premiums on new PRT business of $239 million and higher deposits on new GICs of $94 million. Corebridge | First Quarter 2024 Form 10-Q 101 TABLE OF CONTENTS ITEM 2 | Business Segment Operations Corporate and Other Corporate and Other primarily consists of interest expense on financial debt, parent expenses not attributable to other segments, institutional asset management business, which includes managing assets for non-consolidated affiliates, results of our consolidated investment entities, results of our legacy insurance lines ceded to Fortitude Re and intercompany eliminations. Corporate and Other Results Three Months Ended March 31, (in millions) 2024 2023 Revenues: Premiums (a) $ 19 $ 20 Net investment income (loss) (10) 68 Net realized gains (losses) on real estate investments (8) 4 Other income 23 14 Total adjusted revenues 24 106 Benefits and expenses: General operating expenses: Corporate and other 66 72 Asset management (b) 20 19 Total general operating expenses 86 91 Interest expense: Corporate 107 108 Asset management and other 30 64 Total interest expense 137 172 Total benefits and expenses 223 263 Noncontrolling interest (c) 51 (6) Adjusted pre-tax operating (loss) before consolidation and eliminations (148) (163) Consolidations and eliminations (3) — Adjusted pre-tax operating (loss) $ (151) $ (163) (a) Premiums include an expense allowance associated with Fortitude Re which is entirely offset in general and operating expenses – Corporate and Other. (b) General operating expenses – Asset management primarily represent the costs to manage the investment portfolio for affiliates that are not included in the consolidated financial statements of Corebridge. (c) Noncontrolling interests represent the third-party or Corebridge affiliated interest in internally managed consolidated investment vehicles and are almost entirely offset within net investment income, net realized gains (losses) and interest expense. Corporate and Other Sources of Earnings The following table presents the sources of earnings of the Corporate and Other segment. We believe providing APTOI using this view is useful for gaining an understanding of our overall results of operations and the significant drivers of our earnings: Three Months Ended March 31, (in millions) 2024 2023 Corporate expenses $ (39) $ (48) Interest expense on financial debt (107) (108) Asset management 14 — Consolidated investment entities (1) — Other (18) (7) Adjusted pre-tax operating (loss) $ (151) $ (163) Financial Highlights Three Months Ended March 31, 2024 to Three Months Ended March 31, 2023 APTOI Comparison Adjusted pre-tax operating loss decreased $12 million primarily due to: • lower corporate expenses of $9 million primarily driven by Corebridge Forward, our modernization program delivering both expense reduction and increased efficiency. Corebridge | First Quarter 2024 Form 10-Q 102 TABLE OF CONTENTS ITEM 2 | Investments Investments OVERVIEW Our investment strategies are tailored to the specific business needs of each operating unit by targeting an asset allocation mix that supports estimated cash flows of our outstanding liabilities and provides diversification from asset class, sector, issuer and geographic perspectives. The primary objectives are generation of investment income, preservation of capital, liquidity management and growth of surplus. The majority of assets backing our insurance liabilities consist of fixed maturity securities, RMBS, CMBS, CLOs, other ABS and fixed maturity securities issued by government-sponsored entities and corporate entities. At March 31, 2024, for $206.5 billion of invested assets supporting our insurance operating companies, approximately 45% were in corporate debt securities. Mortgage-backed securities (“MBS”), ABS and CLOs represent 34% of our fixed income securities, and 99% were investment grade. At December 31, 2023, for $202.8 billion of invested assets supporting our insurance operating companies, approximately 47% were in corporate debt securities. MBS, ABS and CLOs represent 31% of our fixed income securities and 99% were investment grade. See “Business - Investment Management” for further information, including current and future management of our investment portfolio.” Key Investment Strategies Investment strategies are assessed at the segment level and involve considerations that include local and general market and economic conditions, duration and cash flow management, risk appetite and volatility constraints, rating agency and regulatory capital considerations, tax, regulatory and legal investment limitations, and, as applicable, environmental, social and governance considerations. In 2021, we entered into a long-term asset management relationship with Blackstone IM. Blackstone IM initially managed $50 billion of our existing investment portfolio, with that amount to increase to an aggregate of $92.5 billion by the third quarter of 2027. The investments underlying the original $50 billion mandate with Blackstone IM began to run-off in 2022 and will be reinvested over time. As these assets run-off, we expect Blackstone to reinvest primarily in Blackstone-originated investments across a range of asset clas ses, including private and structured credit, and commercial and residential real estate securitized and whole loans. Blackstone’s preferred credit and lending strategy is to seek to control all significant components of the underwriting and pricing processes with the goal of facilitating bespoke opportunities with historically strong credit protection and attractive risk-adjusted returns. Blackstone seeks to capture enhanced economics to those available in the traditional fixed income markets by going directly to the borrowers. We believe that Blackstone’s ability to originate attractive and privately sourced, fixed-income oriented assets, will be accretive to our businesses and provide us with an enhanced competitive advantage as we have been able to expand our investment capabilities, access new asset classes and improve our investment yields. We continue to manage asset allocation and portfolio-level risk management decisions with respect to any assets managed by Blackstone, ensuring that we maintain a consistent level of oversight across our entire investment portfolio considering our asset-liability matching needs, risk appetite and capital position. As of March 31, 2024, Blackstone managed $62.7 billion in book value of assets in our investment portfolio. Under the investment management agreements with BlackRock and its investment advisory affiliates, as of March 31, 2024, BlackRock managed approximately $85.7 billion in book value of assets in our investment portfolio, consisting of liquid fixed income and certain private placement assets. In addition, liquid fixed income assets associated with the Fortitude Re portfolio were separately transferred to BlackRock for management. The investment management agreements with BlackRock provide us with access to market-leading capabilities, including portfolio management, research and tactical strategies in addition to a larger pool of investment professionals. We believe BlackRock’s scale and fee structure make BlackRock an excellent outsourcing partner for certain asset classes and will allow us to further optimize our investment management operating model while improving overall performance. The investment management agreements contain detailed investment guidelines and reporting requirements. These agreements also contain reasonable and customary representations and warranties, standard of care, expense reimbursement, liability, indemnity and other provisions. Some of our key investment strategies are as follows: • our fundamental strategy across the portfolios is to seek investments with similar characteristics to the associated insurance liabilities to the extent practicable; • we seek to purchase investments that offer enhanced yield through illiquidity premiums, such as private placements and commercial mortgage loans, which also add portfolio diversification. These assets typically afford credit protections through covenants, ability to customize structures that meet our insurance liability needs and deeper due diligence given information access; Corebridge | First Quarter 2024 Form 10-Q 103 TABLE OF CONTENTS ITEM 2 | Investments • we seek investments that provide diversification from assets available in local markets. To the extent we purchase these investments, we generally hedge any currency risk using derivatives, which could provide opportunities to earn higher risk-adjusted returns compared to investments in the functional currency; • we actively manage our assets and liabilities, counterparties and duration. Our liquidity sources are held primarily in the form of cash, short-term investments and publicly traded, investment grade rated fixed maturity securities that can be readily monetized through sales or repurchase agreements. Certain of our subsidiaries are members of the FHLBs in their respective districts, and we borrow from the FHLB utilizing its funding agreement program. Borrowings from FHLBs are used to supplement liquidity or for other uses deemed appropriate by management. This strategy allows us to both diversify our sources of liquidity and reduce the cost of maintaining sufficient liquidity; • within the United States, investments are generally split between reserve-backing and surplus portfolios: – insurance liabilities are backed mainly by investment grade fixed maturity securities that meet our duration, risk-return, tax liquidity, credit quality and diversification objectives. We assess asset classes based on their fundamental underlying risk factors, including credit (public and private), commercial real estate and residential real estate, regardless of whether such investments are bonds, loans or structured products; and – surplus investments seek to enhance portfolio returns and are generally comprised of a mix of fixed maturity investment grade and below investment grade securities and various alternative asset classes, including private equity, real estate equity and hedge funds. Over the past few years, hedge fund investments have been reduced; • outside of the United States, fixed maturity securities held by our insurance companies consist primarily of investment grade securities generally denominated in the currencies of the countries in which we operate; and • we also utilize derivatives to manage our asset and liability duration as well as currency exposures. Asset Liability Management Our investment strategy is to invest in assets that generate net investment income to back policyholder benefit and deposit liabilities that result in stable distributable earnings and enhance portfolio value, subject to asset-liability management, capital, liquidity and regulatory constraints. We use asset-liability management as a primary tool to monitor and manage interest rate and duration risk in our businesses. We maintain a diversified, high quality portfolio of fixed maturity securities issued by corporations, municipalities and other governmental agencies; structured securities collateralized by, among other assets, residential and commercial real estate; and commercial mortgage loans that, to the extent practicable, match the duration characteristics of the liabilities. We seek to diversify the portfolio across asset classes, sectors and issuers to mitigate idiosyncratic portfolio risks. The investment portfolio of each product line is tailored to the specific characteristics of its insurance liabilities, and as a result, duration varies between distinct portfolios. The interest rate environment has a direct impact on the asset liability management profile of the businesses, and changes in the interest rate environment may result in the need to lengthen or shorten the duration of the portfolio. In a rising rate environment, we may shorten the duration of the investment portfolio. Fixed maturity securities of our domestic operations have an average duration of 6.7 years as of March 31, 2024. In addition, we seek to enhance surplus portfolio returns through investments in a diversified portfolio of alternative investments. Although these alternative investments are subject to earnings fluctuations, they have historically achieved accumulative returns over time in excess of the fixed maturity portfolio returns. Corebridge | First Quarter 2024 Form 10-Q 104 TABLE OF CONTENTS ITEM 2 | Investments Investment Portfolio The following table presents carrying amounts of our total investments: (in millions) Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total March 31, 2024 Bonds available-for-sale: U.S. government and government-sponsored entities $ 1,104 $ 260 $ 1,364 Obligations of states, municipalities and political subdivisions 4,803 638 5,441 Non-U.S. governments 3,731 256 3,987 Corporate debt 92,694 11,477 104,171 Mortgage-backed, asset-backed and collateralized: RMBS 14,841 749 15,590 CMBS 9,815 487 10,302 CLO 11,581 187 11,768 ABS 15,601 602 16,203 Total mortgage-backed, asset-backed and collateralized 51,838 2,025 53,863 Total bonds available-for-sale 154,170 14,656 168,826 Other bond securities 363 4,283 4,646 Total fixed maturities 154,533 18,939 173,472 Equity securities 76 — 76 Mortgage and other loans receivable: Residential mortgages 8,979 — 8,979 Commercial mortgages 30,833 3,184 34,017 Life insurance policy loans 1,422 325 1,747 Commercial loans, other loans and notes receivable 2,926 161 3,087 Total mortgage and other loans receivable (a) 44,160 3,670 47,830 Other invested assets (b) 7,941 2,095 10,036 Short-term investments 3,983 161 4,144 Total (c) $ 210,693 $ 24,865 $ 235,558 December 31, 2023 Bonds available-for-sale: U.S. government and government-sponsored entities $ 946 $ 274 $ 1,220 Obligations of states, municipalities and political subdivisions 5,178 653 5,831 Non-U.S. governments 3,782 275 4,057 Corporate debt 94,118 11,964 106,082 Mortgage-backed, asset-backed and collateralized: RMBS 13,531 746 14,277 CMBS 9,493 488 9,981 CLO 10,938 206 11,144 ABS 13,337 598 13,935 Total mortgage-backed, asset-backed and collateralized 47,299 2,038 49,337 Total bonds available-for-sale 151,323 15,204 166,527 Other bond securities 366 4,212 4,578 Total fixed maturities 151,689 19,416 171,105 Equity securities 63 — 63 Mortgage and other loans receivable: Residential mortgages 8,428 — 8,428 Commercial mortgages 30,354 3,204 33,558 Life insurance policy loans 1,416 330 1,746 Commercial loans, other loans and notes receivable 2,961 174 3,135 Total mortgage and other loans receivable (a) 43,159 3,708 46,867 Other invested assets (b) 8,163 2,094 10,257 Short-term investments 4,207 129 4,336 Total (c) $ 207,281 $ 25,347 $ 232,628 (a) Net of total allowance for credit losses for $714 million and $698 million at March 31, 2024 and December 31, 2023, respectively. (b) Other invested assets, excluding Fortitude Re funds withheld assets, include $5.5 billion and $5.6 billion of private equity funds as of March 31, 2024 and December 31, 2023, respectively, which are generally reported on a one-quarter lag. (c) Includes the consolidation of approximately $5.6 billion and $5.9 billion of consolidated investment entities at March 31, 2024 and December 31, 2023, respectively. Corebridge | First Quarter 2024 Form 10-Q 105 TABLE OF CONTENTS ITEM 2 | Investments The following table presents carrying amounts of our total investments for our insurance operating subsidiaries excluding the Fortitude Re funds withheld assets: (in millions) March 31, 2024 December 31, 2023 Bonds available-for-sale: U.S. government and government-sponsored entities $ 1,104 $ 945 Obligations of states, municipalities and political subdivisions 4,802 5,178 Non-U.S. governments 3,730 3,782 Corporate debt Public credit 72,266 73,014 Private credit 20,658 21,388 Total corporate debt 92,924 94,402 Mortgage-backed, asset-backed and collateralized: RMBS 15,242 13,941 CMBS 9,817 9,493 CLO 11,532 10,893 ABS 15,604 13,337 Total mortgage-backed, asset-backed and collateralized 52,195 47,664 Total bonds available-for-sale 154,755 151,971 Other bond securities 324 329 Total fixed maturities 155,079 152,300 Equity securities 56 55 Mortgage and other loans receivable: Residential mortgages 7,444 6,869 Commercial mortgages 31,395 30,892 Commercial loans, other loans and notes receivable 3,018 3,040 Total mortgage and other loans receivable (a)(b) 41,857 40,801 Other invested assets Hedge funds 184 222 Private equity (c) 5,009 5,012 Real estate investments 262 270 Other invested assets - All other 298 290 Total other invested assets 5,753 5,794 Short-term investments 3,723 3,881 Total (d) $ 206,468 $ 202,831 (a) Does not reflect allowance for credit loss on mortgage loans of $639 million and $623 million at March 31, 2024 and December 31, 2023, respectively. (b) Does not reflect policy loans of $1.4 billion and $1.4 billion at March 31, 2024 and December 31, 2023, respectively. (c) Private equity funds are generally reported on a one-quarter lag. (d) Excludes approximately $5.6 billion and $5.9 billion of consolidated investment entities as well as $2.2 billion and $2.3 billion of eliminations primarily between the consolidated investment entities and the insurance operating companies at March 31, 2024 and December 31, 2023, respectively. Credit Ratings At March 31, 2024, nearly all our fixed maturity securities were held by our U.S. entities and 93% of these securities were rated investment grade by one or more of the principal rating agencies. Moody’s, Standard & Poor’s Financial Services LLC (“S&P”), Fitch or similar foreign rating services rate a significant portion of our foreign entities’ fixed maturity securities portfolio. Rating services are not available for some foreign-issued securities. Our Investments team, with oversight from credit risk management, closely reviews the credit quality of the foreign portfolio’s non-rated fixed maturity securities. Corebridge | First Quarter 2024 Form 10-Q 106 TABLE OF CONTENTS ITEM 2 | Investments NAIC Designations of Fixed Maturity Securities The Securities Valuation Office (“SVO”) of the National Association of Insurance Commissioners (“NAIC”) evaluates the investments of U.S. insurers for statutory reporting purposes and assigns fixed maturity securities to one of six categories called ‘NAIC Designations.’ In general, NAIC Designations of ‘1,’ highest quality, or ‘2,’ high quality, include fixed maturity securities considered investment grade, while NAIC Designations of ‘3’ through ‘6’ generally include fixed maturity securities referred to as below investment grade. NAIC Designations for non-agency RMBS and CMBS are calculated using third-party modeling results provided through the NAIC. These methodologies result in an improved NAIC Designation for such securities compared to the rating typically assigned by the three major rating agencies. The following tables summarize the ratings distribution of our subsidiaries’ fixed maturity security portfolio by NAIC Designation, and the distribution by composite our credit rating, which is generally based on ratings of the three major rating agencies. As of March 31, 2024 and December 31, 2023, 95% and 95%, respectively, of our fixed maturity security portfolio, excluding Fortitude Re funds withheld assets, were investment grade. The fixed maturity security portfolio of our insurance operating subsidiaries, excluding the Fortitude Re funds withheld assets, was 95% and 95% investment grade as of March 31, 2024 and December 31, 2023, respectively. The remaining below investment grade securities that are not included in consolidated investment entities relate to middle market and high yield bank loans securities. The following tables present the fixed maturity security portfolio categorized by NAIC Designation, at fair value: NAIC Designation Excluding Fortitude Re Funds Withheld Assets (in millions) 1 2 Total Investment Grade 3 4 (a) 5 (a) 6 Total Below Investment Grade Total March 31, 2024 Other fixed maturity securities $ 48,228 $ 46,519 $ 94,747 $ 4,166 $ 2,998 $ 399 $ 51 $ 7,614 $ 102,361 Mortgage-backed, asset-backed and collateralized 45,066 6,451 51,517 340 199 25 10 574 52,091 Total (b) $ 93,294 $ 52,970 $ 146,264 $ 4,506 $ 3,197 $ 424 $ 61 $ 8,188 $ 154,452 Fortitude Re funds withheld assets $ 18,939 Total fixed maturities $ 173,391 December 31, 2023 Other fixed maturity securities $ 49,628 $ 46,891 $ 96,519 $ 4,104 $ 2,983 $ 389 $ 58 $ 7,534 $ 104,053 Mortgage-backed, asset-backed and collateralized 41,165 5,806 46,971 307 224 44 11 586 47,557 Total (b) $ 90,793 $ 52,697 $ 143,490 $ 4,411 $ 3,207 $ 433 $ 69 $ 8,120 $ 151,610 Fortitude Re funds withheld assets $ 19,416 Total fixed maturities $ 171,026 (a) Includes $110 million and $6 million of consolidated CLOs that are rated NAIC 4 and 5, respectively, as of March 31, 2024 and $63 million and $6 million of NAIC 4 and 5 securities, respectively, as of December 31, 2023. These are assets of consolidated investment entities and do not represent direct investment of Corebridge’s insurance subsidiaries. (b) Excludes $81 million and $79 million of fixed maturity securities for which no NAIC Designation is available at March 31, 2024 and December 31, 2023, respectively. The following table presents the fixed maturity security portfolio categorized by NAIC Designation, at fair value, for our insurance operating subsidiaries excluding the Fortitude Re funds withheld assets: (in millions) March 31, 2024 December 31, 2023 NAIC 1 $ 93,705 $ 91,207 NAIC 2 53,296 53,029 NAIC 3 4,499 4,408 NAIC 4 3,088 3,147 NAIC 5 and 6 478 496 Total (a)(b) $ 155,066 $ 152,287 (a) Excludes approximately $175 million and $121 million of consolidated investment entities and $718 million and $732 million of eliminations primarily related to the consolidated investment entities and the insurance operating subsidiaries at March 31, 2024 and December 31, 2023, respectively. (b) Excludes $13 million and $13 million of fixed maturity securities for which no NAIC Designation is available at March 31, 2024 and December 31, 2023, respectively . Corebridge | First Quarter 2024 Form 10-Q 107 TABLE OF CONTENTS ITEM 2 | Investments Composite Corebridge Credit Ratings With respect to our fixed maturity securities, the credit ratings in the table below and in subsequent tables reflect: (i) a composite of the ratings of the three major rating agencies, or when agency ratings are not available, the rating assigned by the NAIC SVO (100% of total fixed maturity securities), or (ii) our equivalent internal ratings when these investments have not been rated by any of the major rating agencies or the NAIC. The “Non-rated” category in those tables consists of fixed maturity securities that have not been rated by any of the major rating agencies, the NAIC or us. The following tables present the fixed maturity security portfolio categorized by composite Corebridge credit rating (as described below), at fair value: Composite Corebridge Credit Rating Excluding Fortitude Re Funds Withheld Assets (in millions) AAA/AA/A BBB Total Investment Grade BB B CCC and Lower Total Below Investment Grade (a)(b) Total March 31, 2024 Other fixed maturity securities $ 48,498 $ 46,345 $ 94,843 $ 4,071 $ 3,004 $ 443 $ 7,518 $ 102,361 Mortgage-backed, asset-backed and collateralized 41,609 7,201 48,810 395 345 2,541 3,281 52,091 Total (c) $ 90,107 $ 53,546 $ 143,653 $ 4,466 $ 3,349 $ 2,984 $ 10,799 $ 154,452 Fortitude Re funds withheld assets $ 18,939 Total fixed maturities $ 173,391 December 31, 2023 Other fixed maturity securities $ 49,833 $ 46,706 $ 96,539 $ 4,083 $ 3,014 $ 417 $ 7,514 $ 104,053 Mortgage-backed, asset-backed and collateralized 37,795 6,439 44,234 430 335 2,558 3,323 47,557 Total (c) $ 87,628 $ 53,145 $ 140,773 $ 4,513 $ 3,349 $ 2,975 $ 10,837 $ 151,610 Fortitude Re funds withheld assets $ 19,416 Total fixed maturities $ 171,026 (a) Includes $2.7 billion and $2.7 billion at March 31, 2024 and December 31, 2023, respectively, of certain RMBS that had experienced deterioration in credit quality since its origination but prior to Corebridge’s acquisition. These securities are currently rated as investment grade under the NAIC SVO framework. (b) Includes $127 million of consolidated CLOs as of March 31, 2024 and $76 million as of December 31, 2023. These are assets of consolidated investment entities and do not represent direct investment of Corebridge’s insurance subsidiaries. (c) Excludes $81 million and $79 million of fixed maturity securities for which no NAIC Designation is available at March 31, 2024 and December 31, 2023, respectively . The following table presents the fixed maturity security portfolio categorized by composite Corebridge credit rating (as described below), at fair value for our insurance operating subsidiaries: Composite Corebridge Credit Rating For Our Insurance Operating Subsidiaries (in millions) AAA/AA/A BBB Total Investment Grade BB B CCC and Lower Total Below Investment Grade Total March 31, 2024 Other fixed maturity securities $ 48,499 $ 46,694 $ 95,193 $ 4,061 $ 2,914 $ 421 $ 7,396 $ 102,589 Mortgage-backed, asset-backed and collateralized 42,014 7,182 49,196 398 346 2,537 3,281 52,477 Total fixed maturities* $ 90,513 $ 53,876 $ 144,389 $ 4,459 $ 3,260 $ 2,958 $ 10,677 $ 155,066 December 31, 2023 Other fixed maturity securities $ 49,836 $ 47,056 $ 96,892 $ 4,079 $ 2,957 $ 408 $ 7,444 $ 104,336 Mortgage-backed, asset-backed and collateralized 38,204 6,422 44,626 434 338 2,553 3,325 47,951 Total fixed maturities* $ 88,040 $ 53,478 $ 141,518 $ 4,513 $ 3,295 $ 2,961 $ 10,769 $ 152,287 * Excludes $13 million and $13 million of fixed maturity securities for which no NAIC Designation is available at March 31, 2024 and December 31, 2023, respectively . For a discussion of credit risks associated with investments, see “Business—Investment Management—Credit Risk” in the 2023 Form 10-K. Corebridge | First Quarter 2024 Form 10-Q 108 TABLE OF CONTENTS ITEM 2 | Investments The following tables present the composite Corebridge credit ratings of our fixed maturity securities calculated based on their fair value: Available-for-Sale Other Fixed Maturity Securities, at Fair Value Total Excluding Fortitude Funds Withheld Assets (in millions) March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 Rating: Other fixed maturity securities* AAA $ 1,594 $ 1,656 $ — $ — $ 1,594 $ 1,656 AA 21,733 21,970 15 14 21,748 21,984 A 25,156 26,193 — — 25,156 26,193 BBB 46,328 46,688 17 18 46,345 46,706 Below investment grade 7,496 7,506 10 10 7,506 7,516 Non-rated 25 11 — — 25 11 Total $ 102,332 $ 104,024 $ 42 $ 42 $ 102,374 $ 104,066 Mortgage-backed, asset- backed and collateralized AAA $ 11,193 $ 9,720 $ 19 $ 19 $ 11,212 $ 9,739 AA 22,576 20,577 79 83 22,655 20,660 A 7,639 7,293 103 103 7,742 7,396 BBB 7,146 6,383 55 56 7,201 6,439 Below investment grade 3,255 3,297 20 19 3,275 3,316 Non-rated 29 29 45 44 74 73 Total $ 51,838 $ 47,299 $ 321 $ 324 $ 52,159 $ 47,623 Total AAA $ 12,787 $ 11,376 $ 19 $ 19 $ 12,806 $ 11,395 AA 44,309 42,547 94 97 44,403 42,644 A 32,795 33,486 103 103 32,898 33,589 BBB 53,474 53,071 72 74 53,546 53,145 Below investment grade 10,751 10,803 30 29 10,781 10,832 Non-rated 54 40 45 44 99 84 Total $ 154,170 $ 151,323 $ 363 $ 366 $ 154,533 $ 151,689 Corebridge | First Quarter 2024 Form 10-Q 109 TABLE OF CONTENTS ITEM 2 | Investments Available-for-Sale Other Fixed Maturity Securities, at Fair Value Total Fortitude Re Funds Withheld Assets (in millions) March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 Rating: Other fixed maturity securities* AAA $ 374 $ 387 $ 22 $ 23 $ 396 $ 410 AA 3,518 3,603 811 795 4,329 4,398 A 3,378 3,559 148 158 3,526 3,717 BBB 4,877 5,084 1,251 1,225 6,128 6,309 Below investment grade 484 533 478 457 962 990 Non-rated — — 4 6 4 6 Total $ 12,631 $ 13,166 $ 2,714 $ 2,664 $ 15,345 $ 15,830 Mortgage-backed, asset- backed and collateralized AAA $ 150 $ 141 $ 132 $ 117 $ 282 $ 258 AA 745 770 554 555 1,299 1,325 A 233 238 239 225 472 463 BBB 365 361 589 591 954 952 Below investment grade 531 526 54 59 585 585 Non-rated 1 2 1 1 2 3 Total $ 2,025 $ 2,038 $ 1,569 $ 1,548 $ 3,594 $ 3,586 Total AAA $ 524 $ 528 $ 154 $ 140 $ 678 $ 668 AA 4,263 4,373 1,365 1,350 5,628 5,723 A 3,611 3,797 387 383 3,998 4,180 BBB 5,242 5,445 1,840 1,816 7,082 7,261 Below investment grade 1,015 1,059 532 516 1,547 1,575 Non-rated 1 2 5 7 6 9 Total $ 14,656 $ 15,204 $ 4,283 $ 4,212 $ 18,939 $ 19,416 Corebridge | First Quarter 2024 Form 10-Q 110 TABLE OF CONTENTS ITEM 2 | Investments Available-for-Sale Other Fixed Maturity Securities, at Fair Value Total Total (in millions) March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 Rating: Other fixed maturity securities* AAA $ 1,968 $ 2,043 $ 22 $ 23 $ 1,990 $ 2,066 AA 25,251 25,573 826 809 26,077 26,382 A 28,534 29,752 148 158 28,682 29,910 BBB 51,205 51,772 1,268 1,243 52,473 53,015 Below investment grade 7,980 8,039 488 467 8,468 8,506 Non-rated 25 11 4 6 29 17 Total $ 114,963 $ 117,190 $ 2,756 $ 2,706 $ 117,719 $ 119,896 Mortgage-backed, asset-backed and collateralized AAA $ 11,343 $ 9,861 $ 151 $ 136 $ 11,494 $ 9,997 AA 23,321 21,347 633 638 23,954 21,985 A 7,872 7,531 342 328 8,214 7,859 BBB 7,511 6,744 644 647 8,155 7,391 Below investment grade 3,786 3,823 74 78 3,860 3,901 Non-rated 30 31 46 45 76 76 Total $ 53,863 $ 49,337 $ 1,890 $ 1,872 $ 55,753 $ 51,209 Total AAA $ 13,311 $ 11,904 $ 173 $ 159 $ 13,484 $ 12,063 AA 48,572 46,920 1,459 1,447 50,031 48,367 A 36,406 37,283 490 486 36,896 37,769 BBB 58,716 58,516 1,912 1,890 60,628 60,406 Below investment grade 11,766 11,862 562 545 12,328 12,407 Non-rated 55 42 50 51 105 93 Total $ 168,826 $ 166,527 $ 4,646 $ 4,578 $ 173,472 $ 171,105 * Consists of assets including U.S. government and government sponsored entities, obligations of states, municipalities and political subdivisions, non-U.S. governments, and corporate debt. The following table presents the fair value of our aggregate credit exposures to non-U.S. governments for our fixed maturity securities: March 31, 2024 December 31, 2023 (in millions) Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Chile $ 371 $ 12 $ 383 $ 357 $ 13 $ 370 Indonesia 332 22 354 344 23 367 Mexico 255 13 268 257 13 270 France 238 18 256 229 18 247 United Arab Emirates 209 4 213 221 4 225 Qatar 197 53 250 204 61 265 Saudi Arabia 178 19 197 185 20 205 Colombia 157 26 183 155 26 181 Norway 148 — 148 160 — 160 Panama 142 19 161 145 19 164 Other 1,504 83 1,587 1,525 91 1,616 Total* $ 3,731 $ 269 $ 4,000 $ 3,782 $ 288 $ 4,070 * Includes bonds available-for-sale and other bond securities. Corebridge | First Quarter 2024 Form 10-Q 111 TABLE OF CONTENTS ITEM 2 | Investments Investments in Corporate Debt Securities The following table presents the industry categories of our available-for-sale corporate debt securities: March 31, 2024 December 31, 2023 Fair Value Fair Value (in millions) Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Excluding Fortitude Re Funds Withheld Assets Fortitude Re Funds Withheld Assets Total Industry Category: Financial institutions $ 25,476 $ 2,329 $ 27,805 $ 25,875 $ 2,429 $ 28,304 Utilities 14,038 2,443 16,481 14,108 2,545 16,653 Communications 5,911 665 6,576 5,957 730 6,687 Consumer noncyclical 11,764 1,405 13,169 12,093 1,444 13,537 Capital goods 4,009 397 4,406 4,230 412 4,642 Energy 8,151 1,052 9,203 8,323 1,096 9,419 Consumer cyclical 5,377 502 5,879 5,114 520 5,634 Basic materials 3,115 322 3,437 3,141 350 3,491 Other 14,853 2,362 17,215 15,277 2,438 17,715 Total* $ 92,694 $ 11,477 $ 104,171 $ 94,118 $ 11,964 $ 106,082 * 93% and 93% of investments were rated investment grade at March 31, 2024 and December 31, 2023, respectively. Corebridge | First Quarter 2024 Form 10-Q 112 TABLE OF CONTENTS ITEM 2 | Investments Investments in RMBS The following table presents our RMBS available-for-sale securities: March 31, 2024 December 31, 2023 (in millions) Fair Value Percent of Total Fair Value Percent of Total Agency RMBS $ 4,078 28% $ 4,218 31% AAA 19 20 AA 4,059 4,198 A — — BBB — — Below investment grade — — Non-rated — — Alt-A RMBS 3,497 24% 3,147 23% AAA 963 692 AA 717 685 A 72 38 BBB 63 54 Below investment grade 1,682 1,678 Non-rated — — Sub-prime RMBS 1,123 8% 1,124 8% AAA — — AA 78 78 A 60 60 BBB 68 50 Below investment grade 917 936 Non-rated — — Prime non-agency 2,615 17% 2,399 18% AAA 1,271 1,163 AA 884 847 A 260 198 BBB 87 76 Below investment grade 112 113 Non-rated 1 2 Other housing related 3,528 23% 2,643 20% AAA 2,436 1,822 AA 588 465 A 258 246 BBB 229 93 Below investment grade 13 13 Non-rated 4 4 Total RMBS excluding Fortitude Re funds withheld assets 14,841 100 % 13,531 100% Total RMBS Fortitude Re funds withheld assets 749 746 Total RMBS (a)(b) $ 15,590 $ 14,277 (a) Includes $2.7 billion and $2.7 billion at March 31, 2024 and December 31, 2023, respectively, of certain RMBS that had experienced deterioration in credit quality since their origination but prior to Corebridge’s acquisition. These securities are currently rated as investment grade under the NAIC SVO framework. (b) The weighted average expected life was 6 years at March 31, 2024 and 7 years at December 31, 2023. Our underwriting principles for investing in RMBS, other ABS and CLOs take into consideration the quality of the originator, the manager, the servicer, security credit ratings, underlying characteristics of the mortgages, borrower characteristics and the level of credit enhancement in the transaction. Corebridge | First Quarter 2024 Form 10-Q 113 TABLE OF CONTENTS ITEM 2 | Investments Investments in CMBS The following table presents our CMBS available-for-sale securities: March 31, 2024 December 31, 2023 (in millions) Fair Value Percent of Total Fair Value Percent of Total CMBS (traditional) $ 8,840 90 % $ 8,265 87 % AAA 3,761 3,691 AA 3,129 2,855 A 880 753 BBB 780 621 Below investment grade 290 345 Non-rated — — Agency 787 8 % 815 9 % AAA 3 3 AA 784 812 A — — BBB — — Below investment grade — — Non-rated — — Other 188 2 % 413 4 % AAA 32 91 AA 14 130 A 53 100 BBB 89 92 Below investment grade — — Non-rated — — Total excluding Fortitude Re funds withheld assets 9,815 100 % 9,493 100 % Total Fortitude Re funds withheld assets 487 488 Total $ 10,302 $ 9,981 The fair value of CMBS holdings increased slightly during the three months ended March 31,2024. The majority of our investments in CMBS are in tranches that contain substantial protection features through collateral subordination. The majority of CMBS holdings are traditional conduit transactions, broadly diversified across property types and geographical areas. Corebridge | First Quarter 2024 Form 10-Q 114 TABLE OF CONTENTS ITEM 2 | Investments Investments in ABS/CLOs The following table presents our ABS/CLO available-for-sale securities by collateral type: March 31, 2024 December 31, 2023 (dollars in millions) Fair Value Percent of Total Fair Value Percent of Total CDO - bank loan (CLO) $ 11,577 43 % $ 10,808 44 % AAA 2,117 1,741 AA 5,519 5,246 A 3,078 3,058 BBB 825 727 Below investment grade 14 13 Non-rated 24 23 CDO - other 2 — % 130 1 % AAA — 1 AA — 125 A — — BBB — 1 Below investment grade 2 3 Non-rated — — ABS 15,603 57 % 13,337 55 % AAA 591 496 AA 6,804 5,136 A 2,978 2,840 BBB 5,005 4,669 Below investment grade 225 196 Non-rated — — Total excluding Fortitude Re funds withheld assets 27,182 100 % 24,275 100 % Total Fortitude Re funds withheld assets 789 804 Total $ 27,971 $ 25,079 Unrealized Losses of Fixed Maturity Securities The following tables show the aging of the unrealized losses on available-for-sale fixed maturity securities, the extent to which the fair value is less than amortized cost or cost, and the number of respective items in each category: March 31, 2024 Less Than or Equal to 20% of Cost (b) Greater Than 20% to 50% of Cost (b) Greater Than 50% of Cost (b) Total Aging (a) (dollars in millions) Cost (c) Unrealized Loss (e) Items (d) Cost (c) Unrealized Loss (e) Items (d) Cost (c) Unrealized Loss (e) Items (d) Cost (c) Unrealized Loss (e) Items (d) Investment grade bonds 0-6 months $ 12,532 $ 349 1,330 $ 3,535 $ 1,112 284 $ 12 $ 8 3 $ 16,079 $ 1,469 1,617 7-11 months 5,357 336 506 1,837 567 140 — — — 7,194 903 646 12 months or more 71,145 6,541 7,618 30,322 8,802 2,557 146 78 13 101,613 15,421 10,188 Total 89,034 7,226 9,454 35,694 10,481 2,981 158 86 16 124,886 17,793 12,451 Below investment grade bonds 0-6 months 1,359 53 384 48 16 28 17 15 8 1,424 84 420 7-11 months 496 21 88 62 18 9 7 7 3 565 46 100 12 months or more 4,514 264 1,006 647 184 101 15 9 11 5,176 457 1,118 Total 6,369 338 1,478 757 218 138 39 31 22 7,165 587 1,638 Total bonds 0-6 months 13,891 402 1,714 3,583 1,128 312 29 23 11 17,503 1,553 2,037 7-11 months 5,853 357 594 1,899 585 149 7 7 3 7,759 949 746 12 months or more 75,659 6,805 8,624 30,969 8,986 2,658 161 87 24 106,789 15,878 11,306 Total excluding Fortitude Re funds withheld assets $ 95,403 $ 7,564 10,932 $ 36,451 $ 10,699 3,119 $ 197 $ 117 38 $ 132,051 $ 18,380 14,089 Total Fortitude Re funds withheld assets $ 16,416 $ 3,109 850 Total $ 148,467 $ 21,489 14,939 Corebridge | First Quarter 2024 Form 10-Q 115 TABLE OF CONTENTS ITEM 2 | Investments December 31, 2023 Less Than or Equal to 20% of Cost (b) Greater than 20% to 50% of Cost (b) Greater than 50% of Cost (b) Total Aging (a) (dollars in millions) Cost (c) Unrealized Loss Items (d) Cost (c) Unrealized Loss Items (d) Cost (c) Unrealized Loss Items (d) Cost (c) Unrealized Loss Items (d) Investment grade bonds 0-6 months $ 8,072 $ 358 964 $ 2,687 $ 779 209 $ 6 $ 3 — $ 10,765 $ 1,140 1,173 7-11 months 9,583 490 880 2,176 628 178 4 2 — 11,763 1,120 1,058 12 months or more 74,309 6,603 7,899 28,479 7,968 2,391 79 42 10 102,867 14,613 10,300 Total 91,964 7,451 9,743 33,342 9,375 2,778 89 47 10 125,395 16,873 12,531 Below Investment grade bonds 0-6 months 1,635 64 449 110 40 41 8 7 8 1,753 111 498 7-11 months 497 18 98 47 13 4 1 1 2 545 32 104 12 months or more 5,127 325 1,066 606 177 104 39 25 8 5,772 527 1,178 Total 7,259 407 1,613 763 230 149 48 33 18 8,070 670 1,780 Total bonds 0-6 months 9,707 422 1,413 2,797 819 250 14 10 8 12,518 1,251 1,671 7-11 months 10,080 508 978 2,223 641 182 5 3 2 12,308 1,152 1,162 12 months or more 79,436 6,928 8,965 29,085 8,145 2,495 118 67 18 108,639 15,140 11,478 Total excluding Fortitude Re funds withheld assets $ 99,223 $ 7,858 11,356 $ 34,105 $ 9,605 2,927 $ 137 $ 80 28 $ 133,465 $ 17,543 14,311 Total Fortitude Re funds withheld assets $ 16,725 $ 2,934 891 Total $ 150,190 $ 20,477 15,202 (a) Represents the number of consecutive months that fair value has been less than amortized cost or cost by any amount. (b) Represents the percentage by which fair value is less than amortized cost or cost at March 31, 2024 and December 31, 2023. (c) For bonds, represents amortized cost net of allowance. (d) Item count is by CUSIP by subsidiary. (e) Includes MTM movement relating to embedded derivatives. The allowance for credit losses was $5 million and $7 million for investment grade bonds, and $92 million and $121 million for below investment grade bonds as of March 31, 2024 and December 31, 2023, respectively. Change in Unrealized Gains and Losses on Investments The change in net unrealized gains and losses on investments for the three months ended March 31,2024, was primarily attributable to a change in the fair value of fixed maturity securities. For the three months ended March 31,2024, net unrealized losses were $1.1 billion due to higher interest rates, partially offset by narrowing of credit spreads. The change in net unrealized gains and losses on investments for the three months ended March 31, 2023 was primarily attributable to an increase in the fair value of fixed maturity securities. For the three months ended March 31, 2023, net unrealized gains were $4.0 billion due to lower interest rates. For further discussion of our investment portfolio, see Notes 5 and 6 to the Condensed Consolidated Financial Statements. Corebridge | First Quarter 2024 Form 10-Q 116 TABLE OF CONTENTS ITEM 2 | Investments Commercial Mortgage Loans At March 31, 2024 and December 31, 2023, we had direct commercial mortgage loan exposure of $34.7 billion and $34.2 billion, respectively. At March 31, 2024 and December 31, 2023, we had an allowance for credit losses of $634 million and $614 million, respectively. The following tables present the commercial mortgage loan exposure by location and class of loan based on amortized cost: Number of Loans Class Total Percent of Total Excluding Fortitude Re Funds Withheld Assets (dollars in millions) Apartments Offices Retail Industrial Hotel Others March 31, 2024 State: New York 70 $ 1,334 $ 3,511 $ 278 $ 517 $ 68 $ 1 $ 5,709 18 % California 57 671 844 101 1,137 577 12 3,342 11 % New Jersey 74 2,074 72 255 752 — 21 3,174 10 % Texas 40 763 584 329 219 18 128 2,041 7 % Massachusetts 19 549 638 499 15 — — 1,701 5 % Florida 43 642 106 359 78 455 — 1,640 5 % Illinois 21 504 352 3 65 — 20 944 3 % Pennsylvania 19 134 94 193 236 23 — 680 2 % Colorado 14 250 61 87 70 157 — 625 2 % Ohio 19 77 6 78 406 — — 567 2 % Other States 105 2,272 232 501 756 143 — 3,904 12 % Foreign 72 3,480 1,048 716 1,318 285 221 7,068 23 % Total* 553 $ 12,750 $ 7,548 $ 3,399 $ 5,569 $ 1,726 $ 403 $ 31,395 100 % Fortitude Re funds withheld assets $ 3,256 Total Commercial Mortgages $ 34,651 December 31, 2023 State: New York 69 $ 1,301 $ 3,577 $ 276 $ 392 $ 70 $ 1 $ 5,617 18 % California 57 665 837 102 1,153 579 12 3,348 11 % New Jersey 73 2,012 73 256 650 — 21 3,012 10 % Texas 38 760 609 131 221 18 — 1,739 6 % Massachusetts 19 550 567 492 15 — — 1,624 5 % Florida 44 632 107 361 97 455 — 1,652 5 % Illinois 20 503 353 3 39 — 20 918 3 % Pennsylvania 19 128 94 206 188 23 — 639 2 % Colorado 15 285 61 87 70 157 — 660 2 % Ohio 19 78 6 80 407 — — 571 2 % Other States 105 2,273 221 505 699 144 47 3,889 13 % Foreign 72 3,479 1,069 728 1,432 291 224 7,223 23 % Total* 550 $ 12,666 $ 7,574 $ 3,227 $ 5,363 $ 1,737 $ 325 $ 30,892 100 % Fortitude Re funds withheld assets $ 3,280 Total Commercial Mortgages $ 34,172 * Does not reflect allowance for credit losses. Corebridge | First Quarter 2024 Form 10-Q 117 TABLE OF CONTENTS ITEM 2 | Investments The following tables present debt service coverage ratios and loan-to-value ratios for commercial mortgages: Debt Service Coverage Ratios (a) (in millions) >1.20X 1.00X - 1.20X <1.00X Total March 31, 2024 Loan-to-value ratios (b) Less than 65% $ 17,658 $ 3,241 $ 282 $ 21,181 65% to 75% 6,035 1,315 44 7,394 76% to 80% 676 65 47 788 Greater than 80% 1,233 401 398 2,032 Total commercial mortgages excluding Fortitude Re (c) $ 25,602 $ 5,022 $ 771 $ 31,395 Total commercial mortgages including Fortitude Re $ 3,256 Total commercial mortgages $ 34,651 December 31, 2023 Loan-to-value ratios (b) Less than 65% $ 17,301 $ 3,141 $ 285 $ 20,727 65% to 75% 5,577 1,337 44 6,958 76% to 80% 938 64 47 1,049 Greater than 80% 1,349 402 407 2,158 Total commercial mortgages excluding Fortitude Re (c) $ 25,165 $ 4,944 $ 783 $ 30,892 Total commercial mortgages including Fortitude Re $ 3,280 Total commercial mortgages $ 34,172 (a) The debt service coverage ratio compares a property’s net operating income to its debt service payments, including principal and interest. Our weighted average debt service coverage ratio was 1.9X at both periods ended March 31, 2024 and December 31, 2023. The debt service coverage ratios are updated when additional relevant information becomes available. (b) The loan-to-value ratio compares the current unpaid principal balance of the loan to the estimated fair value of the underlying property collateralizing the loan. Our weighted average loan-to-value ratio was 59% at both periods ended March 31, 2024 and December 31, 2023. The loan-to-value ratios have been updated within the last three months to reflect the current carrying values of the loans. We update the valuations of collateral properties by obtaining independent appraisals, generally at least once per year. (c) Does not reflect allowance for credit losses. Residential Mortgage Loans At March 31, 2024 and December 31, 2023, we had direct residential mortgage loan exposure of $9.0 billion and $8.4 billion, respectively. The following tables present credit quality performance indicators for residential mortgages by year of vintage: March 31, 2024 (in millions) 2024 2023 2022 2021 2020 Prior Total FICO: (a)