What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-02-29 compared with 2023-02-27 · 1366 added, 796 removed, 1779 unchanged (55% of the section changed)

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We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 29, 2024, expressed an unqualified opinion thereon.

Adoption of ASU No.

As discussed in Note A to the consolidated financial statements, the Company changed its method of accounting for long-duration contracts in each of the three years in the period ended December 31, 2023 due to the adoption of ASU No.

2018-12, Financial Services – Insurance (Topic 944), Targeted Improvements to the Accounting for Long-Duration Contracts.

Basis for Opinion

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Auditing the Company’s reserve for title claim losses was complex because of the highly judgmental nature of the determination of the loss provision rates used in the valuation of the reserve for title claim losses.

The significant judgment was primarily due to the sensitivity of management’s estimate to claim loss history, industry trends, current legal environment, and geographic considerations.

The significant judgment was primarily due to the sensitivity of management’s estimate to claim loss history, industry trends, and current legal environment.

How we Addressed the

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These controls included, among others, the review and approval process management has in place for the development of the loss provision rates and the estimation of the reserve for title claim losses.

To evaluate the judgment used by management in determining the loss provision rates, among other procedures, we considered claim loss history, industry trends, current legal environment and geographic considerations, and how management assessed these factors in the current period as compared to prior periods.

To evaluate the judgment used by management in determining the loss provision rates, among other procedures, we considered claim loss history, industry trends, current legal environment, and how management assessed these factors in the current period as compared to prior periods.

We involved actuarial professionals with specialized skills and industry knowledge, who assisted in performing an evaluation of the Company’s current year loss provision rates compared with those used in prior periods, as well as a review of loss development experience for prior years.

We also independently calculated a range of reasonable reserve estimates which we compared to management’s recorded reserve for title claim losses.

Value of Business Acquired (VOBA), Deferred Acquisition Costs (DAC), Deferred Sales Inducements (DSI) and secondary guarantee liabilities

Description of the Matter

At December 31, 2022 VOBA, DAC, and DSI reported within other intangible assets, net totaled $3.7 billion and contractholder funds totaled $41.2 billion, a portion of which related to indexed universal life (IUL)-type and Investment-type contracts with secondary guarantees.

As discussed in Note A to the consolidated financial statements, VOBA, DAC, and DSI are generally amortized over the lives of the policies in relation to the emergence of actual gross profits (AGPs) and estimated gross profits (EGPs).

Secondary guarantee liabilities on IUL-type products or Investment-type contracts are calculated by multiplying the benefit ratio by the cumulative assessments recorded from contract inception through the balance sheet date less the cumulative secondary guarantee benefit payments plus interest.

The benefit ratio is the ratio of the present value of secondary guarantees to the present value of the assessments used to provide the secondary guarantees.

The assessments are calculated using the same assumptions used in VOBA, DAC, and DSI EGPs.

There is significant uncertainty inherent in calculating EGPs and assessments as the calculation is sensitive to management’s best estimate of assumptions such as earned rate, budgeted option costs, surrender rates, mortality, and guaranteed minimum withdrawal benefit (GMWB) utilization.

Changes in assumptions, including the Company’s earned rate, budgeted option costs, surrender rates, mortality, and GMWB utilization can have a significant impact on the pattern of EGPs of the underlying business and as a result the amortization of VOBA, DAC and DSI balances.

Management’s assumptions are adjusted, also known as unlocking, based on actual policyholder behavior and market experience and projecting for expected trends.

The unlocking results in amortization being recalculated using the new assumptions for estimated gross profits, resulting either in additional or less cumulative amortization expense.

Additionally, if experience or assumption changes result in a new benefit ratio, the secondary guarantee liabilities are adjusted to reflect the changes in a manner similar to the unlocking of VOBA, DAC, and DSI.

Auditing the valuation of the Company’s VOBA, DAC, and DSI that are amortized in relation to the emergence of AGPs/EGPs and valuation of secondary guarantee liabilities on IUL-type products or Investment-type contracts was complex because of the highly judgmental nature of the methods used and determination of the assumptions applied to determine the EGPs and assessments.

The high degree of judgment was primarily due to the sensitivity of the EGPs and assessments to the methods used and assumptions applied which have a significant effect on the valuation of VOBA, DAC, DSI and secondary guarantee liabilities on IUL-type products or Investment-type contracts.

How we Addressed the

Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls over the VOBA, DAC, DSI, and contractholder funds estimation processes.

These controls included, among others, the review and approval process management has in place for the development of the significant assumptions described above.

To evaluate the judgment used by management in determining the EGPs and assessments, among other procedures, we involved actuarial specialists and evaluated the methodology applied by management in determining the EGPs and assessments with those used in prior periods.

To evaluate the significant assumptions used by management, we compared policyholder behavior assumptions that we identified as being higher risk to prior actual experience, observable market data or management’s estimates of prospective changes in these assumptions.

We performed an independent recalculation of EGPs and secondary guarantee liabilities for a sample of product cohorts, which we compared to the actuarial model used by management.

Valuation of Investments in Securities

Description of the Matter

The Company’s fair value of fixed maturity securities totaled $33.1 billion as of December 31, 2022.

The fair value of a subset of these securities, including asset backed securities and bonds, is based on non-binding broker quotes as described in Note D to the consolidated financial statements.

The lack of visibility into assumptions used in non-binding broker quotes is a significant unobservable input, which creates greater subjectivity when determining the fair values.

Auditing the fair value of the securities valued by brokers was especially challenging because determining the fair value is complex and highly judgmental and involves using inputs and assumptions that are not directly observable in the market.

How we Addressed the

Matter in Our Audit

We obtained an understanding, evaluated the design and tested the operating effectiveness of management’s valuation process for broker-quoted securities.

These controls included management’s evaluation of the broker-quoted values compared to an independently calculated range of values.

To test the fair value of the securities, we utilized the support of our valuation specialists which included, among other procedures, independently calculating a reasonable range of fair values for a sample of securities based on independently obtained information or available transaction data for similar securities.

We compared these ranges to management’s estimates of fair value for the selected securities.

Assumptions related to Fixed Indexed Annuity Embedded Derivative Liability

Fixed Indexed Annuity Embedded Derivative Liability, Market Risk Benefits, and Future Policy Benefits Liability

Description of the Matter

As of December 31, 2022, the fair value of the Company’s fixed indexed annuity embedded derivative liability totaled $3.1 billion.

Certain of the Company’s fixed indexed annuity contracts allow the policyholder to elect an equity index linked feature, where amounts credited to the contract’s account value are linked to the performance of designated equity indices selected by the policyholder.

The equity index crediting feature is accounted for as an embedded derivative liability and reported at fair value as discussed in Note D to the consolidated financial statements.

Auditing the valuation of the Company’s fixed indexed annuity embedded derivative was complex because of the highly judgmental nature of the determination of the assumptions required to determine the fair value of the embedded derivative.

In particular, the fair value was sensitive to the significant assumptions used to determine future policy growth including the mortality, surrender rates, partial withdrawals, GMWB utilization, non-performance spread, and option cost.

There is significant uncertainty inherent in determining the mortality, surrender rates, partial withdrawals, GMWB utilization, non-performance spread and option cost assumptions.

At December 31, 2023, the fair value of the Company’s fixed indexed annuity embedded derivative liability totaled $4.3 billion.

Certain of the Company’s fixed indexed annuity (FIA) contracts allow the policyholder to elect an equity index linked feature, where amounts credited to the contract’s account value are linked to the performance of designated equity indices and crediting strategy selected by the policyholder.

The equity index crediting feature is accounted for as an embedded derivative liability and reported at fair value as discussed in Notes A (see section on Contractholder Funds), D, F, and Y to the consolidated financial statements.

A subset of FIA contracts include certain contract features that provide minimum guarantees to policyholders, such as guaranteed minimum withdrawal benefits and guaranteed minimum death benefit features that are market risk benefits (MRB) measured at fair value as discussed in Notes A (see section on MRBs), D, W and X to the consolidated financial statements.

The Company’s MRB assets and MRB liabilities totaled $88 million and $403 million, respectively, as of December 31, 2023.

At December 31, 2023, future policy benefits (FPB) liabilities related to traditional life and life-contingent immediate annuity policies (which includes life-contingent pension risk transfer annuities) totaled $7.0 billion.

The future policy benefits liability related to these products is based on estimates of how much the Company will need to pay for future benefits and related claim expenses and the amount of net premiums to be collected from policyholders as discussed in Notes A (see section on Future Policy Benefits), W, and Z to the consolidated financial statements.

Auditing the valuation of the Company’s fixed indexed annuity embedded derivative, MRBs, and FPB liabilities was complex because of the highly judgmental nature of the determination of the assumptions required to determine the fair value of the embedded derivative and MRBs and valuation of FPB liabilities.

In particular, the fair value of fixed indexed annuity embedded derivative and MRBs was sensitive to the significant assumptions including surrender rates, GMWB utilization, and non-performance spread.

In addition, option cost was a significant assumption used in the valuation of fixed index annuity embedded derivatives and mortality, partial withdrawals, and capital market performance scenarios were significant assumptions used in the valuation of MRBs.

Mortality is a significant assumption used in the valuation of FPB liabilities.

How we Addressed the

Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s controls over management’s process for the development of the significant assumptions used in measuring the fair value of the embedded derivative for fixed indexed annuities.

Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s controls over management’s process for the development of the significant assumptions used in measuring the fair value of the embedded derivative for fixed indexed annuities and MRBs and the valuation of FPB liabilities.

These controls included, among others, the review and approval process management has in place for the development of the significant assumptions.

To evaluate the judgment used by management in determining the assumptions used in measuring the fair value of the fixed indexed annuity embedded derivative, among other procedures, we involved actuarial specialists and evaluated the methodology applied by management in determining the fair value with those used in the prior period and in the industry.

To evaluate the significant assumptions used by management in the methodology applied, we compared policyholder behavior assumptions to prior actual experience and management’s estimate of prospective changes in the assumptions.

In addition, we compared the nonperformance spread and option costs assumptions to observable market data.

We performed an independent recalculation of the embedded derivative for a sample of products for comparison with the actuarial model used by management.

To evaluate the judgment used by management in determining the assumptions used in measuring the fair value of the fixed indexed annuity embedded derivative and MRBs and the valuation of FPB liabilities, among other procedures, we involved actuarial specialists and evaluated the methodology applied by management in determining the valuation with those used in the prior period and in the industry.

To evaluate the significant assumptions used by management in the methodology applied, we compared as applicable, the significant assumptions noted above to historical experience, observable market data, and management’s estimates of prospective changes in these assumptions.

We also performed an independent recalculation of the embedded derivative, MRB, and FPB liabilities for a sample of policies or cohorts for comparison with the actuarial models used by management.

/s/ Ernst & Young LLP

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Prepaid expenses and other assets 1,900 2,068

Market risk benefits assets 88 117

Lease assets 348 376

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Accounts payable and accrued liabilities 3,009 2,326

Market risk benefits liability 403 282

Notes payable 3,887 3,238

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Benefits and other changes in policy reserves 3,553 1,126 1,932

Market risk benefit losses (gains) 95 ( 182 ) ( 44 )

Depreciation and amortization 593 491 432

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Net earnings from continuing operations 518 1,306 2,809

Net earnings (loss) from discontinued operations, net of tax — 8 ( 25 )

Net earnings from discontinued operations, net of tax — — 8

Net earnings 518 1,306 2,817

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Net earnings from continuing operations attributable to FNF common shareholders $ 1.91 $ 4.71 $ 9.78

Net earnings (loss) from discontinued operations attributable to FNF common shareholders — 0.03 ( 0.09 )

Net earnings from discontinued operations attributable to FNF common shareholders — — 0.03

Net earnings per share attributable to FNF common shareholders, basic $ 1.91 $ 4.71 $ 9.81

Net earnings from continuing operations attributable to FNF common shareholders $ 1.91 $ 4.67 $ 9.72

Net earnings (loss) from discontinued operations attributable to FNF common shareholders — 0.03 ( 0.09 )

Net earnings from discontinued operations attributable to FNF common shareholders — — 0.03

Net earnings per share attributable to FNF common shareholders, diluted $ 1.91 $ 4.67 $ 9.75

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Other comprehensive earnings:

Unrealized (loss) gain on investments and other financial instruments, net of adjustments to intangible assets and unearned revenue (excluding investments in unconsolidated affiliates) (1) ( 3,839 ) ( 413 ) 1,310

Unrealized gain (loss) on investments and other financial instruments, net of adjustments to intangible assets and unearned revenue (excluding investments in unconsolidated affiliates) (1) 961 ( 4,783 ) ( 499 )

Unrealized gain on investments in unconsolidated affiliates (2) 12 9 23

Unrealized (loss) gain on foreign currency translation (3) ( 18 ) ( 7 ) 10

Unrealized gain (loss) on foreign currency translation (3) 6 ( 18 ) ( 6 )

Reclassification adjustments for change in unrealized gains and losses included in net earnings (4) 126 173 ( 101 )

Changes in current discount rate - future policy benefits (5) ( 189 ) 764 124

Changes in instrument-specific credit risk - market risk benefits (6) ( 34 ) 67 10

Change in reinsurance liabilities held at fair value resulting from a change in the instrument-specific credit risk — — 3

Other comprehensive earnings attributable to non-controlling interest (6) 29 — —

Other comprehensive (loss) earnings attributable to non-controlling interest (7) ( 134 ) 35 —

Minimum pension liability adjustment (8) 3 5 ( 7 )

Other comprehensive (loss) earnings ( 3,641 ) ( 525 ) 1,261

Comprehensive (loss) earnings ( 2,489 ) 1,917 2,713

Other comprehensive earnings (loss) 751 ( 3,748 ) ( 453 )

Comprehensive earnings (loss) 1,269 ( 2,442 ) 2,364

Comprehensive earnings attributable to non-controlling interests 1 12 20

Comprehensive (loss) earnings attributable to Fidelity National Financial, Inc.

Comprehensive earnings (loss) attributable to Fidelity National Financial, Inc.

common shareholders $ 1,268 $ ( 2,454 ) $ 2,344

(1) Net of income tax (benefit) expense of $( 1,010 ) million, $( 113 ) million, and $ 350 million for the years ended December 31, 2022, 2021, and 2020, respectively.

(2) Net of income tax expense of $ 3 million, $ 7 million, and $ 1 million for the years ended December 31, 2022, 2021, and 2020, respectively.

(3) Net of income tax (benefit) expense of $( 4 ) million, $ 0 million, and $ 1 million for the years ended December 31, 2022, 2021, and 2020, respectively.

(1) Net of income tax expense (benefit) of $ 238 million, $( 1,246 ) million, and $( 140 ) million for the years ended December 31, 2023, 2022, and 2021, respectively.

(2) Net of income tax expense of $ 3 million, $ 3 million, and $ 7 million for the years ended December 31, 2023, 2022, and 2021, respectively.

(3) Net of income tax expense (benefit) of $ 2 million and $( 4 ) million, for the years ended December 31, 2023 and 2022, respectively.

(6) Net of income tax expense of $ 8 million for the year ended December 31, 2022.

(4) Net of income tax expense (benefit) of $ 34 million, $ 45 million and $( 26 ) million for the years ended December 31, 2023, 2021 and 2021, respectively.

(5) Net of income tax (benefit) expense of $( 50 ) million, $ 203 million and $ 33 million for the years ended December 31, 2023, 2021 and 2021, respectively .

(6) Net of income tax (benefit) expense of $( 9 ) million, $ 18 million and $ 3 million for the years ended December 31, 2023, 2021 and 2021, respectively.

(7) Net of income tax (benefit) expense of $( 35 ) million and $ 9 million for the years ended December 31, 2023, and 2022, respectively.

(8) Net of income tax expense (benefit) of $ 2 million and $( 2 ) million for the years ended December 31, 2022, and 2021, respectively.

See accompanying Notes to Consolidated Financial Statements

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Common Shareholders

FNF Other Redeemable

Common Additional Comprehensive Treasury Non- Non-

Stock Paid-in Retained Earnings Stock controlling Total controlling

Shares $ Capital Earnings (Loss) Shares $ Interests Equity Interests

Common Additional Comprehensive Treasury Non-

Stock Paid-in Retained Earnings Stock controlling Total

Shares $ Capital Earnings (Loss) Shares $ Interests Equity

Balance, January 1, 2021 322 $ — $ 5,720 $ 2,468 $ 1,331 31 $ ( 1,067 ) $ 41 $ 8,493

Exercise of stock options 2 — 48 — — — — — 48

F&G Acquisition 25 — 827 — — 7 ( 217 ) — 610

Purchase of ServiceLink noncontrolling interest — — 211 — — — — 47 258 ( 344 )

Purchase of incremental share in consolidated subsidiaries — — — — — — — 1 1

Issuance of restricted stock 1 — — — — — — — —

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Change in reinsurance liabilities held at fair value resulting from change in instrument-specific credit risk — — — — 3 — — — 3

Change in current discount rate — liability for future policy benefits — — — — 124 — — — 124

Change in instrument-specific credit risk - market risk benefits — — — — 10 — — — 10

Subsidiary dividends declared to non-controlling interests — — — — — — — ( 19 ) ( 19 )

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Balance, December 31, 2021 325 $ — $ 5,810 $ 4,818 $ 878 42 $ ( 1,545 ) $ 43 $ 10,004

FIDELITY NATIONAL FINANCIAL, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY (CONTINUED)

(In millions, except per share data)

Fidelity National Financial, Inc.

Common Shareholders

Common Additional Comprehensive Treasury Non-

Stock Paid-in Retained Earnings Stock controlling Total

Shares $ Capital Earnings (Loss) Shares $ Interests Equity

Balance January 1, 2022 325 — $ 5,810 $ 4,818 $ 878 42 $ ( 1,545 ) $ 43 $ 10,004

Exercise of stock options 2 — 39 — — — — — 39

Non-controlling interest associated with current period acquisitions — — — — — — — 46 46

Treasury stock repurchased — — — — — 13 ( 549 ) — ( 549 )

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Reclassification adjustments for change in unrealized gains and losses included in net earnings — — — — 173 — — — 173

Other comprehensive earnings attributable to non-controlling interest — — — — 35 — — ( 35 ) —

Stock-based compensation — — 48 — — — — 1 49

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Shares withheld for taxes and in treasury — — — — — — ( 15 ) — ( 15 )

Change in reinsurance liabilities held at fair value resulting from change in instrument-specific credit risk — — — — 3 — — — 3 —

Change in current discount rate — liability for future policy benefits — — — — 764 — — — 764

Change in instrument-specific credit risk - market risk benefits — — — — 67 — — — 67

Distribution of 15 % of the common stock of F&G

( 24 ) ( 397 ) 421 —

Subsidiary dividends declared to non-controlling interests — — — — — — — ( 24 ) ( 24 )

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Exercise of stock options — — 15 — — — — — 15

Non-controlling interest associated with current period acquisitions 45 45

Treasury stock repurchased — — — — — — ( 4 ) — ( 4 )

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Shares withheld for taxes and in treasury — — — — — 1 ( 17 ) — ( 17 )

Distribution of 15 % of the common stock of F&G

— — ( 19 ) ( 301 ) — — — 320 —

Change in current discount rate — liability for future policy benefits — — — — ( 189 ) — — — ( 189 )

Change in instrument-specific credit risk - market risk benefits — — — — ( 34 ) — — — ( 34 )

F&G purchases of treasury stock — — ( 1 ) — — ( 18 ) ( 19 )

Other comprehensive earnings attributable to non-controlling interest — — ( 15 ) — ( 134 ) — — 149 —

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Interest credited/index credits to contractholder account balances 1,409 ( 560 ) 573

Change in market risk benefits, net 95 ( 182 ) ( 44 )

Deferred policy acquisition costs and deferred sales inducements ( 1,084 ) ( 814 ) ( 675 )

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Purchases of investment securities ( 13,985 ) ( 13,148 ) ( 16,014 )

Net (purchases of) proceeds from sales and maturities of short-term investment securities ( 2,571 ) 266 145

F&G acquisition — — ( 1,076 )

Net proceeds (purchases of) from sales and maturities of short-term investment securities 340 ( 2,571 ) 266

Other acquisitions/disposals, net of cash acquired ( 299 ) ( 180 ) ( 100 )

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Debt offering 845 — 449

F&G Credit Agreement repayments, net ( 185 ) — —

Debt costs/equity issuance additions ( 16 ) ( 4 ) ( 6 )

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Contractholder account withdrawals ( 4,625 ) ( 3,450 ) ( 2,931 )

F&G repurchases of F&G stock ( 18 ) — —

Purchases of treasury stock ( 6 ) ( 553 ) ( 463 )

Net cash provided by financing activities 3,093 4,095 5,000

Net (decrease) increase in cash and cash equivalents ( 2,074 ) 1,641 1,343

Net increase (decrease) in cash and cash equivalents 481 ( 2,074 ) 1,641

Cash and cash equivalents at beginning of period 2,286 4,360 2,719

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Recent Developments

Amendment to our Revolving Credit Facility

On February 16, 2024, we entered into a Sixth Amended and Restated Credit Agreement for our $ 800 million revolving credit facility (the "Amended Revolving Credit Facility") with Bank of America, N.A., as administrative agent and other agents party thereto (the "Sixth Restated Credit Agreement").

For further information related to the Amended Revolving Credit Facility and the Sixth Restated Credit Agreement refer to Note G Notes Payable .

Amendment to the F&G Credit Agreement

On February 16, 2024, we entered into a Second Amended and Restated F&G Credit Agreement of our $ 665 million credit agreement, with the guarantors party thereto, the financial institutions party thereto as lenders, and Bank of America, N.A., as administrative agent, swing line lender and an issuing bank (the "Second Amended and Restated F&G Credit Agreement").

For more information related to the Second Amended and Restated F&G Credit Agreement refer to Note G Notes Payable .

Acquisition of ROAR

On January 2, 2024, F&G acquired a 70 % majority ownership stake in the equity of Roar Joint Venture, LLC ("Roar").

Roar wholesales life insurance and annuity products to banks and broker dealers through a network of agents.

Total initial consideration is comprised of cash of approximately $ 269 million and contingent consideration.

Under the terms of the purchase agreement, the Company has agreed to make cash payments of up to approximately $ 90 million over a three year period upon the achievement of certain earnings before interest, taxes, depreciation and amortization milestones of Roar.

Investment of $ 250 million in F&G

On January 12, 2024, we completed a $ 250 million preferred stock investment in F&G.

F&G will use the net proceeds from the investment to support growth of its assets under management.

Under the terms of the agreement, we have agreed to invest $ 250 million in exchange for 5 million shares of F&G's 6.875 % Series A Mandatory Convertible Preferred Stock, par value $ 0.001 per share (the "Mandatory Convertible Preferred Stock").

Each share of Mandatory Convertible Preferred Stock will have a liquidation preference of $ 50.00 per share.

Unless earlier converted at the option of the holder, each outstanding share of the Mandatory Convertible Preferred Stock will automatically convert into shares of common stock of F&G on January 15, 2027 (the "Mandatory Conversion Date").

Upon conversion on the Mandatory Conversion Date, the conversion rate for each share of the Mandatory Convertible Preferred Stock will be no more than 1.1111 shares of common stock and no less than 0.9456 shares of common stock per share of Mandatory Convertible Preferred Stock, depending on the value of F&G's common stock.

7.95 % F&G Senior Notes

On December 6, 2023, F&G completed the public offering of $ 345 million aggregate principal amount of its 7.95 % Senior Notes due 2053 (the " 7.95 % F&G Notes").

F&G used the net proceeds from the sale of the notes to repay borrowings under its revolving credit facility and for general corporate purposes, including the support of organic growth opportunities.

The Senior notes were registered under the Securities Act of 1933 (as amended) (the "Securities Act").

For further information related to the 7.95 % F&G Notes, refer to Note G Notes Payable .

2023 Cybersecurity Incident

On November 19, 2023, we became aware of a cybersecurity incident that impacted certain of our systems.

We promptly commenced an investigation, retained leading experts to assist the Company, notified law enforcement authorities, regulatory authorities and other stakeholders, and followed our incident response plans.

In addition, we took containment measures such as blocking access to certain of our systems resulting in varying levels of disruption to our businesses.

The incident was contained on November 26, 2023.

We completed our forensic investigation on December 13, 2023.

We determined that an unauthorized third-party accessed certain of our systems, deployed a type of malware that is not self-propagating, and exfiltrated certain data.

We have no evidence that any customer-owned system was directly impacted in the incident, and no customer has reported that this has occurred.

The last confirmed date of unauthorized third-party activity in our network occurred on November 20, 2023.

We have identified and analyzed the nature and scope of the affected systems and data.

We have notified our affected customers and applicable state attorneys general and regulators, and approximately 1.3 million potentially impacted consumers;

are providing credit monitoring, web monitoring, and identity theft restoration services;

and are fielding questions from customers.

We are continuing to coordinate with law enforcement, our customers, regulators, advisors and other stakeholders.

We have been named as a defendant in several lawsuits related to this incident.

The Company will vigorously defend itself against any litigation filed related to this incident.

For further information on the litigation related to this incident, refer to Note H Commitments and Contingencies .

At this time, we do not believe that the incident will have a material impact on the Company.

7.40 % F&G Senior Notes

On January 13, 2023, F&G completed its issuance and sale of $ 500 million aggregate amount of its 7.40 % Senior Notes due 2028 (the " 7.40 % F&G Notes"), pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended.

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F&G intends to use the net proceeds from the offering of the 7.40 % F&G Notes for general corporate purposes, including to support the growth of assets under management and for F&G's future liquidity requirements.

The interest rate payable on the 7.40 % F&G Notes will be subject to adjustment from time to time if either S&P or Fitch (or a substitute rating agency therefor) downgrades (or downgrades and subsequently upgrades) the credit ratings assigned to the 7.40 % F&G Notes.

The interest rate payable on the 7.40 % F&G Notes will be subject to adjustment from time to time if either S&P or Fitch (or a substitute rating agency) downgrades (or downgrades and subsequently upgrades) the credit ratings assigned to the 7.40 % F&G Notes.

For further information related to the 7.40 % F&G Notes, refer to Note G Notes Payable .

Acquisition of TitlePoint

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TitlePoint enables searches for detailed property information, images of documents and maps from hundreds of counties across the U.S and is a leader in the science of real estate property research technology.

F&G Distribution

On December 1, 2022, we completed our previously announced separation and distribution of approximately 15 % of the common stock of F&G (the "F&G Distribution").

Following the F&G Distribution, we retained control of F&G through our approximate 85 % ownership stake.

The F&G Distribution was accomplished by the distribution of 68 shares of common stock, par value $ 0.001 per share, of F&G for every 1,000 shares of common stock, par value $ 0.0001 per share, of FNF (“FNF Common Stock”) as a dividend to each holder of shares of FNF Common Stock as of the close of business on November 22, 2022, the record date for the Distribution.

As a result of the F&G Distribution, F&G is a separate, publicly traded company and its businesses, assets and liabilities are expected to primarily consist of those related to F&G’s business as a provider of insurance solutions serving retail annuity and life customers and institutional clients.

Through F&G’s insurance subsidiaries, including Fidelity & Guaranty Life Insurance Company and Fidelity & Guaranty Life Insurance Company of New York, F&G intends continue to market a broad portfolio of deferred annuities (fixed indexed annuities and multi-year guarantee annuities or other fixed rate annuities), immediate annuities, indexed universal life insurance, funding agreements (through funding agreement-backed notes issuances and the Federal Home Loan Bank of Atlanta) and pension risk transfer solutions.

All of FNF’s core title insurance, real estate, technology and mortgage related businesses, assets and liabilities that are not held by F&G remain with FNF.

F&G Credit Facility

On November 22, 2022, F&G entered into a Credit Agreement (the "F&G Credit Agreement") with certain lenders (the "Lenders") and Bank of America, N.A.

as administrative agent (the "Administrative Agent"), swing line lender and an issuing

bank, pursuant to which F&G has an available unsecured revolving credit facility (the "F&G Credit Facility") in an aggregate principal amount of $ 550 million to be used for working capital and general corporate purposes.

As of December 31, 2022, the F&G Credit Facility was fully drawn with $ 550 million outstanding, offset by approximately $ 3 million of unamortized debt issuance costs.

A net partial paydown of $ 35 million was made on January 6, 2023 and, on February 21, 2023, F&G entered into an amendment (the "First Amendment") to the F&G Credit Agreement (the "Amended F&G Credit Agreement").

The First Amendment increased the aggregate principal amount of commitments under the F&G Credit Facility by $ 115 million to $ 665 million.

For further information related to the F&G Credit Facility, refer to Note G Notes Payable .

Repayment of 5.50 % Senior Notes

On September 1, 2022, we repaid the remaining $ 400 million in outstanding principal amount of our 5.50 % Senior Notes due September 2022.

Acquisition of AllFirst Title Insurance Agency ("AllFirst")

On August 9, 2022, we acquired approximately 74 % of the outstanding equity of AllFirst for approximately $ 130 million in cash consideration.

On December 19, 2022, we purchased an additional 6 % of the outstanding equity of AllFirst for approximately $ 10 million in cash consideration.

AllFirst and its portfolio brands, FirsTitle, Excel Title Group, Allegiance Title Company, Guaranty Title, Smith Brothers Abstract, Aggieland Title Company, and Guaranty Title New Mexico provide title examination, title plant, abstract, and settlement services for residential, commercial, farm and ranch sales, and energy projects in 121 counties throughout Texas, Oklahoma, New Mexico, and Arkansas.

For further information related to the acquisition of AllFirst, refer to Note B Acquisitions.

Note Receivable from Cannae

In November 2017, in conjunction with the split-off of our former portfolio company investments into a separate company, Cannae Holdings, Inc.

("Cannae"), we issued to Cannae a revolver note, which we and Cannae amended and restated on May 12, 2022 (as amended and restated, the "Cannae Revolver").

The Cannae Revolver in the aggregate principal amount of up to $ 100 million accrues interest quarterly at the Adjusted Term SOFR Rate, as defined in the Amended and Restated Revolver Note, plus 450 basis points and matures on November 17, 2025.

The maturity date is automatically extended for additional five-year terms unless notice of non-renewal is otherwise provided by either FNF or Cannae, in their sole discretion.

During the year ended December 31, 2022, Cannae borrowed approximately $ 85 million under the Cannae Revolver.

We account for the Cannae Revolver as a financing receivable.

Interest income is recorded ratably in periods in which principal is outstanding.

Uncollectible financing receivables are written off or impaired when, based on all available information, it is probable that a loss has occurred.

For further information related to the acquisition of TitlePoint, refer to Note B Acquisitions .

Principles of Consolidation and Basis of Presentation

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We assess our relationships with VIEs to evaluate if we are the primary beneficiary of the VIE.

If we determine we are the primary beneficiary of a VIE, we consolidate the assets and liabilities of the VIE in our Consolidated Financial Statements.

determine we are the primary beneficiary of a VIE, we consolidate the assets and liabilities of the VIE in our Consolidated Financial Statements.

See Note E Investments for additional information on our investments in VIEs.

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Fixed maturity securities are purchased to support our investment strategies, which are developed based on factors including rate of return, maturity, credit risk, duration, tax considerations and regulatory requirements.

Our investments in fixed maturity securities have been designated as available-for-sale ("AFS") and are carried at fair value, net of allowance for

expected credit losses, with unrealized gains and losses included within accumulated other comprehensive income (loss) ("AOCI"), net of associated adjustments for deferred acquisition costs ("DAC"), value of business acquired ("VOBA"), deferred sales inducements ("DSI"), unearned revenue ("UREV"), Statement of Position 03-1, “ Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts ,” ("SOP 03-1") reserves, and deferred income taxes.

Fair values for fixed maturity securities are principally a function of current market conditions and are valued based on quoted prices in markets that are not active or model inputs that are observable or unobservable.

We recognize investment income on fixed maturities based on the interest method, which results in the recognition of a constant rate of return on the investment equal to the prevailing rate at the time of purchase or at the time of subsequent adjustments of book value.

In our title segment, realized gains and losses on sales of our fixed maturity securitie s are determined on the basis of the cost of the specific investments sold and are credited or charged to income on a trade date basis.

Our F&G segment uses FIFO cost basis and generally records security transactions on a trade date basis except for private placements, which are recorded on a settlement date basis.

Our investments in fixed maturity securities have been designated as available-for-sale ("AFS") and are carried at fair value, net of allowance for expected credit losses, with unrealized gains and losses included within AOCI, net of deferred income taxes.

Fair values for fixed maturity securities are principally a function of current market conditions and are primarily valued based on quoted prices in markets that are not active or model inputs that are observable or unobservable.

We recognize investment income on fixed maturities based on the effective interest method, which results in the recognition of a constant rate of return on the investment equal to the prevailing rate at the time of purchase or at the time of subsequent adjustments of book value.

In our title segment, realized gains and losses on sales of our fixed maturity securities are determined on the basis of the cost of the specific investments sold and are credited or charged to income on a trade date basis.

Our F&G segment uses first-in first-out cost basis and generally records security transactions on a trade date basis except for private placements, which are recorded on a settlement date basis.

Realized gains and losses on sales of fixed maturity securities are reported within Recognized gains and losses, net in the accompanying Consolidated Statements of Earnings.

Fixed maturity securities AFS are subject to an allowance for credit loss and changes in the allowance are reported in net earnings as a component of Recognized gains and losses, net.

For details on our policy around allowance for expected credit losses on available-for-sale securities, refer to Note E Investments.

For details on our policy around allowance for expected credit losses on AFS securities, refer to Note E Investments.

Preferred and Equity Securities

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In our F&G segment, we hedge certain portions of our exposure to product related equity market risk by entering into derivative transactions (primarily call options).

We utilize interest rate swaps to reduce market risks from interest rate changes on our earnings associated with our floating rate investments.

All such derivative instruments are recognized as either assets or liabilities in the accompanying Consolidated Balance Sheets at fair value.

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If it is determined that the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and a separate instrument with the same terms would qualify as a derivative instrument, the embedded derivative is bifurcated from the host contract for measurement purposes.

The embedded derivative is carried at fair value, which is determined through a combination of market observable inputs such as market value of option and interest swap rates and unobservable inputs such as the mortality multiplier, surrender and withdrawal rates and non-performance spread.

The changes in fair value are reported within Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

See a description of the fair value methodology used in Note D Fair Value of Financial Instruments .

The Company’s embedded derivative associated to our FIA crediting rates policies is carried at fair value, which is determined through a combination of market observable inputs such as market value of option and interest swap rates and unobservable inputs such as the mortality multiplier, surrender and withdrawal rates and non-performance spread.

The changes in fair value of the FIA embedded derivative are reported within Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

Reinsurance Related Embedded Derivatives

As discussed in Note O F&G Reinsurance , F&G entered into reinsurance agreements with Kubera Insurance (SAC) Ltd.

("Kubera"), effective December 31, 2018, and ASPIDA Life Re Ltd ("Aspida Re"), effective January 1, 2021, and amended in August 2021 and September 2022, to cede a quota share of certain deferred annuity and multi-year guaranteed annuities ("MYGA") and deferred annuity "), respectively, GAAP and statutory reserves on a coinsurance funds withheld basis, net of applicable existing reinsurance.

Effective October 31, 2021, the Kubera agreement was novated from Kubera to Somerset Reinsurance Ltd.

("Somerset"), a certified third-party reinsurer.

As discussed in Note O F&G Reinsurance , F&G entered into reinsurance agreements to cede a quota share of certain deferred annuity, multi-year guaranteed annuities ("MYGA") and deferred annuity"), respectively, GAAP and statutory reserves on a coinsurance funds withheld basis, net of applicable existing reinsurance.

Funds withheld arrangements allow the Company to retain legal ownership of assets backing reinsurance arrangements until they are earned by the reinsurer while passing credit risk associated with the assets in the funds withheld account to the reinsurer.

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Investment results for the assets that support the coinsurance with funds withheld reinsurance arrangement, including gains and losses from sales, are passed directly to the reinsurer pursuant to contractual terms of the reinsurance arrangement.

These total return swaps are not clearly and closely related to the underlying reinsurance contract and thus require bifurcation.

These total return swaps are not clearly and closely related to the underlying reinsurance

contract and thus require bifurcation.

The reinsurance related embedded derivative is reported in Prepaid expenses and other assets if in a net gain position, or Accounts payable and accrued liabilities, if in a net loss position on the Consolidated Balance Sheets and the related gains or losses are reported in Recognized gains (losses) on the Consolidated Statements of Earnings.

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For details on our policy around allowance for expected credit losses on mortgage loans, refer to Note E Investments .

Commercial mortgage loans are continuously monitored by reviewing appraisals, operating statements, rent revenues, annual inspection reports, loan specific credit quality, property characteristics, market trends and other factors.

Commercial mortgage loans are rated for the purpose of quantifying the level of risk.

Commercial mortgage loans ("CMLs") are continuously monitored by reviewing appraisals, operating statements, rent revenues, annual inspection reports, loan specific credit quality, property characteristics, market trends and other factors.

CMLs are rated for the purpose of quantifying the level of risk.

Loans are placed on a watch list when the debt service coverage ("DSC") ratio falls below certain thresholds and the loan-to-value ("LTV") ratios exceeds certain thresholds.

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We define delinquent mortgage loans as 30 days past due, consistent with industry practice.

Residential mortgage loans have a primary credit quality indicator of either a performing or nonperforming loan.

We define nonperforming residential mortgage loans as those that are 90 or more days past due and/or in nonaccrual status, which is assessed monthly.

Generally, nonperforming residential mortgage loans have a higher risk of experiencing a credit loss.

Residential mortgage loans ("RMLs") have a primary credit quality indicator of either a performing or nonperforming loan.

We define nonperforming RMLs as those that are 90 or more days past due and/or in nonaccrual status, which is assessed monthly.

Generally, nonperforming RMLs have a higher risk of experiencing a credit loss.

We consider residential mortgage loans that are 90 or more days past due and have an LTV greater than 90% to be foreclosure probable.

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Investments in Unconsolidated Affiliates

In our F&G segment, we primarily account for our investments in unconsolidated affiliates (primarily limited partnerships) using the equity method, where the cost is initially recorded as an investment in the entity.

Adjustments to the carrying amount reflect our pro rata ownership percentage of the operating results as indicated by NAV in the limited partnership financial statements.

Income from investments in unconsolidated affiliates is included within Interest and investment income in the accompanying Consolidated Statements of Earnings.

Recognition of income and adjustments to the carrying amount are delayed due to the availability of the related financial statements, which are obtained from the general partner generally on a one to three-month delay.

Management meets quarterly with the general partner to determine whether any credit or other market events have occurred since prior quarter financial statements to ensure any material events are properly included in current quarter valuation and investment income.

In our title business we account for our Investments in unconsolidated affiliates using the equity method of accounting and earnings on our investments in unconsolidated affiliates are recorded within Equity in earnings of unconsolidated affiliates within the Consolidated Statements of Earnings.

In our F&G segment, we account for our investments in unconsolidated affiliates using the equity method or by electing the fair value option.

Initial investments are recorded at cost.

For investments subsequently measured using the equity method (primarily limited partnerships), adjustments to the carrying amount reflect our pro rata ownership percentage of the operating results as indicated by net asset value (“NAV”) in the unconsolidated affiliates’ financial statements, which we may adjust if we determine NAV is not calculated consistent with investment company fair value principles.

Distributions received from investments measured using the equity method are recorded as a decrease in the investment balance.

For investments subsequently measured using the fair value option, adjustments to the carrying amount reflecting the change in fair value of the investment are reported along with realized gains and losses on sales of investments in unconsolidated affiliates in Recognized gains and (losses), net in the accompanying Consolidated Statements of Earnings.

Distributions received from investments measured using the fair value option is reported within Interest and investment income in the accompanying Consolidated Statements of Earnings.

Recognition of income and adjustments to the carrying amount can be delayed due to the availability of the related financial statements, which are obtained from the general partner or managing member generally on a one to three-month delay.

For investments using the equity method, management inquires quarterly with the general partner or managing member to determine whether any credit or other market events have occurred since prior quarter financial statements to ensure any material events are properly included in current quarter valuation and investment income.

In our title segment, we account for our investments in unconsolidated affiliates using the equity method of accounting and earnings on our investments in unconsolidated affiliates are recorded within Equity in earnings of unconsolidated affiliates within the Consolidated Statements of Earnings.

We classify distributions received from unconsolidated affiliates in our Consolidated Statements of Cash Flows using the cumulative earnings approach.

Under the cumulative earnings approach, distributions are considered returns on investment and classified as cash inflows from operating activities unless the Company’s cumulative distributions from an investee received exceed the cumulative equity in earnings of such investee.

When cumulative distributions from an investee exceed cumulative equity in earnings of the investee, such excess is considered a return of investment and is classified as a cash inflow from investing activities.

Interest and investment income

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Income or losses upon call or prepayment of fixed maturity securities are recognized in Interest and investment income.

Amortization of premiums and accretion of discounts on investments in fixed maturity securities are reflected in Interest and investment income over the contractual terms of the investments, and for callable investments at a premium, based on the earliest call date of the investments, in a manner that produces a constant effective yield.

Amortization of

premiums and accretion of discounts on investments in fixed maturity securities are reflected in Interest and investment income over the contractual terms of the investments, and for callable investments at a premium, based on the earliest call date of the investments, in a manner that produces a constant effective yield.

For mortgage-backed and asset-backed securities, included in the fixed maturity securities portfolios, one of two models may be used to recognize interest income.

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For the years ended December 31, 2023, 2022 and 2021, we determined there were no events or circumstances that indicated that the carrying value of a reporting unit exceeded the fair value.

VOBA, DAC and DSI

Our intangible assets include the value of insurance and reinsurance contracts acquired (hereafter referred to as VOBA), DAC, and DSI.

VOBA, DAC, DSI and URL

Our intangible assets include the value of insurance and reinsurance contracts acquired (hereafter referred to as "VOBA"), deferred acquisition costs ("DAC"), deferred sales inducements ("DSI") and unearned revenue liabilities ("URL").

VOBA is an intangible asset that reflects the amount recorded as insurance contract liabilities less the estimated fair value of in-force contracts ("VIF") in a life insurance company acquisition.

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VOBA is a function of the VIF, current GAAP reserves, GAAP assets, and deferred tax liability.

The VIF is determined by the present value of statutory distributable earnings less opening required capital, and is sensitive to assumptions including the discount rate, surrender rates, partial withdrawals, utilization rates, projected investment spreads, mortality, and expenses.

DAC consists principally of commissions that are related directly to the successful sale of new or renewal insurance contracts, which may be deferred to the extent recoverable.

The VIF is determined by the present value of statutory distributable earnings less opening required capital.

DAC consists principally of commissions and other acquisition costs that are related directly to the successful sale of new or renewal insurance contracts.

Indirect or unsuccessful acquisition costs, maintenance, product development and overhead expenses are charged to expense as incurred.

DSI represents up front bonus credits and vesting and persistency bonuses to policyholder account values, which may be deferred to the extent recoverable.

The methodology for determining the amortization of VOBA, DAC and DSI varies by product type.

For all insurance contracts accounted for under long-duration contract deposit accounting, amortization is based on assumptions consistent with those used in the development of the underlying contract liabilities, adjusted for emerging experience and expected trends.

For all of the insurance intangibles (VOBA, DAC and DSI), the balances are generally amortized over the lives of the policies in relation to the expected emergence of estimated gross profits (“EGPs”) from investment income, surrender charges and other product fees, less policy benefits, maintenance expenses, mortality, and expense margins.

Recognized gains (losses) on investments, changes in fair value of derivatives and changes in fair value of the embedded derivative on our FIA and IUL products are included in actual gross profits in the period realized as described further below.

Amortization is reported within Depreciation and amortization in the accompanying Consolidated Statements of Earnings.

Changes in assumptions, including our earned rate (i.e., long term assumptions of the Company’s expected earnings on related investments), budgeted option costs (i.e., the expected cost to purchase call options in future periods to fund the equity indexed linked feature) and surrender rates can have a significant impact on VOBA, DAC and DSI balances and amortization rates.

Due to the relative size and sensitivity to minor changes in underlying assumptions of those intangible balances, we perform quarterly and annual analyses of the VOBA, DAC and DSI balances for recoverability to ensure that the unamortized portion does not exceed the expected recoverable amounts.

At each evaluation date, actual historical gross profits are reflected with the impact on the intangibles reported as “unlocking” as a component of amortization expense, and estimated future gross profits and related assumptions are evaluated for continued reasonableness.

Any adjustment in estimated future gross profits requires that the amortization rate be revised (“unlocking”) retroactively to the date of the contract issuance or acquisition date with respect to VOBA.

The cumulative unlocking adjustment is recognized as a component of current period amortization and reflected within Depreciation and amortization in the accompanying Consolidated Statements of Earnings.

For investment-type products, the VOBA, DAC and DSI assets are adjusted for the impact of unrealized gains (losses) on AFS investments as if these gains (losses) had been realized, with corresponding credits or charges included in AOCI ("shadow adjustments").

DSI represents up front bonus credits and persistency or vesting bonuses credited to contractholder fund balances.

VOBA, DAC, and DSI are amortized on a constant level basis for the grouped contracts over the expected term of the related contracts to approximate straight-line amortization.

Contracts are grouped by product type and feature and issue year into cohorts consistent with the grouping used in estimating the associated liability, where applicable.

The constant level amortization bases of VOBA, DAC and DSI varies by product type.

For universal life and indexed universal life ("IUL") insurance products, the constant level basis used is face amount in force.

For deferred annuities (fixed indexed annuities ("FIA") and fixed rate annuities), the constant level basis used is initial premium deposit for DAC and DSI and vested account value as of the acquisition date for VOBA.

For immediate annuity contracts, the VOBA balance is amortized in alignment with the Company’s accounting policy of amortizing the deferred profit liability ("DPL").

All amortization bases are adjusted by full lapses, which includes deaths, full surrenders, annuitizations and maturities, where applicable.

The constant level bases used for amortization are projected using mortality and lapse assumptions that are based on Company’s experience, industry data, and other factors and are consistent with those used for the future policy benefits ("FPBs"), where applicable.

If those projected assumptions change in future periods, they will be reflected in the cohort level amortization basis at that time.

Unexpected contract terminations, due to higher mortality and/or lapse experience than expected, are recognized in the current period as a reduction of the capitalized balances.

All balances are reduced for actual experience in excess of expected experience with changes in future estimates recognized prospectively over the remaining expected grouped contract term.

The impact of changes in projected assumptions and the impact of actual experience that is different from expectations both impact the amortization of these intangible assets, which is reported within Depreciation and amortization in the accompanying Consolidated Statements of Earnings.

Some of our IUL policies require payment of fees or other policyholder assessments in advance for services that will be rendered over the estimated lives of the policies or contracts.

These payments are established as URLs upon receipt and included in Accounts payable and other accrued liabilities in the Consolidated Balance Sheets.

URL is amortized like DAC over the estimated lives of these policies.

Other Intangible Assets

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Contractual relationships are generally amortized over their contractual life.

Trademarks and tradenames are generally amortized over ten years .

Trademarks and tradenames are generally amortized over ten

Capitalized computer software includes the fair value of software acquired in business combinations, purchased software and capitalized software development costs.

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We do not capitalize any costs once the software is ready for its intended use.

We recorded $ 14 million in impairment expense to other intangible assets in our F&G segment for the year ended December 31, 2022.

We recorded no impairment expense to other intangible assets during the years ended December 31, 2021, and 2020.

We review VOBA, DSI and other intangible assets for impairment annually or when events or circumstances occur that indicate a potential change in the underlying basis.

F or further information, refer to Note M Intangibles .

Title plants are recorded at the cost incurred to construct or obtain and organize historical title information to the point it can be used to perform title searches.

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Title plants are reviewed for impairment whenever events or circumstances indicate that the carrying amounts may not be recoverable.

We reviewed title plants for impairment for the years ended December 31, 2022, 2021 and 2020 and identified and recorded impairment expense of $ 1 million in the year ended December 31, 2022 and reco rded no impair ment expense related to title plants in the years ended December 31, 2021 or 2020.

We reviewed title plants for impairment for the years ended December 31, 2023, 2022 and 2021 and did not record any impairment expense in the years ended December 31, 2023 or 2021.

We reco rded $ 1 million of impair ment expense related to title plants in the year ended December 31, 2022.

Property and Equipment

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Property and equipment are reviewed for impairment whenever events or circumstances indicate that the carrying amounts may not be recoverable.

We recorded $ 2 million of impairment expense related to property and equipment in our title segment in the year ended December 31, 2022.

Contractholder Funds

Contractholder Funds include FIAs, fixed rate annuities, IULs, funding agreements and PRT and immediate annuities contracts without life contingencies.

The liabilities for contractholder funds for fixed rate annuities, funding agreements and PRT and immediate annuities contracts without life contingencies consist of contract account balances that accrue to the benefit of the contractholders.

Contractholder funds include deferred annuities (FIAs and fixed rate annuities), IULs, funding agreements and non-life contingent ("NLC") immediate annuities (which includes NLC pension risk transfer ("PRT") annuities).

The liabilities for contractholder funds for fixed rate annuities, funding agreements and NLC immediate annuities consist of contract account balances that accrue to the benefit of the contractholders.

The liabilities for FIA and IUL policies consist of the value of the host contract plus the fair value of the indexed crediting feature of the policy, which is accounted for as an embedded derivative.

The embedded derivative is carried at fair value in Contractholder funds in the accompanying Consolidated Balance Sheets with changes in fair value reported in Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

The embedded derivative liability is carried at fair value in contractholder funds in the accompanying Consolidated Balance Sheets with changes in fair value reported in Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

See a description of the fair value methodology used in Note D Fair Value of Financial Instruments .

Liabilities for the Guaranteed Minimum Withdrawal Benefits ("GMWB") and Guaranteed Minimum Death Benefit ("GMDB") riders on FIA and fixed rate annuity products are calculated by multiplying the benefit ratio by the cumulative assessments recorded from contract inception through the balance sheet date less the cumulative guaranteed minimum withdrawal and death benefit payments plus interest.

The benefit ratio is the ratio of the present value of future guaranteed minimum withdrawal and death benefit payments to the present value of the assessments used to provide the guaranteed minimum withdrawal and death benefit payments using the same assumptions as we use for our intangible assets.

If experience or assumption changes result in a new benefit ratio, the reserves are adjusted to reflect the changes in a manner similar to the unlocking of VOBA, DAC and DSI.

The accounting for these GMWB and GMDB benefit liabilities (also referred to as "SOP 03-1 liabilities") impact EGPs used to calculate amortization of VOBA, DAC and DSI.

The related reserve is adjusted for the impact of unrealized gains (losses) on AFS investments as if these gains (losses) had been realized, with corresponding credits or charges included in AOCI ("shadow adjustments").

Contractholder funds include funds related to funding agreements that have been issued pursuant to the FABN Program as well as to the Federal Home Loan Bank of Atlanta (" FHLB").

Single premiums are received at the initiation of the funding agreements.

As of December 31, 2022 and December 31, 2021, we had approximately $ 2,200 million and $ 1,900 million outstanding under the FABN Program, respectively, which provides for semi-annual interest payments with principal maturities.

Reserves for the FHLB funding agreements totaled $ 1,982 million and $ 1,543 million as of December 31, 2022 and 2021, respectively.

The FHLB agreements provide a guaranteed stream of payments or provide for a bullet payment at maturity with renewal provisions.

In accordance with the FHLB agreements, the investments supporting the funding agreement liabilities are pledged as collateral to secure the FHLB funding agreement liabilities and are not available to settle our general obligations.

The collateral investments had a fair value of $ 3,387 million and $ 2,469 million as of December 31, 2022 and 2021, respectively.

Payments pursuant to FABN and FHLB funding agreements extend through 2029.

Future Policy Benefits

The liabilities for future policy benefits and claim reserves for traditional life policies and life contingent immediate annuity policies (which includes life-contingent PRT annuities) are computed using assumptions for investment yields, mortality and withdrawals, with a provision for adverse deviation, based on generally accepted actuarial methods and

assumptions at the time of acquisition or contract issue.

The investment yield assumption is 4.3 % for traditional direct life reserves for all contracts, 4.1 % for life contingent pay-out annuities, and ranges from 3.6 % to 6.9 % for PRT annuities with life contingencies.

Policies are terminated through surrenders and maturities, where surrenders represent the voluntary terminations of policies by policyholders and maturities are determined by policy contract terms.

Surrender assumptions are based upon policyholder experience adjusted for expected future conditions.

For long-duration contracts the assumptions are locked in at contract inception and only modified if we deem the reserves to be inadequate.

We periodically review actual and anticipated experience compared to the assumptions used to establish policy benefits.

If the net GAAP liability (gross reserves less VOBA, DAC and DSI) is less than the gross premium liability, impairment is deemed to have occurred, and the VOBA, DAC and DSI asset balances are reduced until the net GAAP liability is equal to the gross premium liability.

If the VOBA, DAC and DSI asset balances are completely written off and the net GAAP liability is still less than the gross premium liability, then an additional liability is recorded to arrive at the gross premium liability.

The FPB is determined as the present value of future policy benefits and related claims expenses to be paid to or on behalf of the policyholder less the present value of future net premiums to be collected from policyholders.

The FPB for traditional life policies and life-contingent immediate annuity policies (which includes life-contingent PRT annuities) are estimated using current assumptions that include discount rate, mortality and surrender/lapse terminations for traditional life insurance policies only, and expenses.

The expense assumption is locked-in at contract issuance and not subsequently reviewed or updated.

The initial assumptions are based on generally accepted actuarial methods and a combination of internal and industry experience.

Policies are terminated through surrenders, lapses and maturities, where surrenders represent the voluntary terminations of policies by policyholders, lapses represent cancellations by us due to nonpayment of premiums, and maturities are determined by policy contract terms.

For traditional life policies and life-contingent immediate annuity policies, contracts are grouped into cohorts by product type, legal entity, and issue year, or acquisition year for cohorts established as of the F&G acquisition date, June 1, 2020.

Life-contingent PRT annuities are grouped into cohorts by deal and legal entity.

At contract inception, a net premium ratio ("NPR") is determined, which is calculated based on discounted future cash flows projected using best estimate assumptions and is capped at 100 %, as net premiums cannot exceed gross premiums.

Cohorts with NPRs less than 100% are not used to offset cohorts with NPRs greater than 100 %.

The NPR is adjusted for changes in cash flow assumptions and for differences between actual and expected experience.

We assess the appropriateness of all future cash flow assumptions, excluding the expense assumption, on a quarterly basis and perform an in-depth review of future cash flow assumptions in the third quarter of each year.

Updates are made when evidence suggests a revision is necessary.

Updates for actual experience, which includes actual cash flows and insurance in-force, are performed on a quarterly basis.

These updated cash flows are used to calculate a revised NPR, which is used to derive an updated liability as of the beginning of the current reporting period, discounted at the original contract issuance date.

The updated liability is compared with the carrying amount of the liability as of that same date before the revised NPR.

The difference between these amounts is the remeasurement gain or loss, presented parenthetically within Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

In subsequent periods, the revised NPR, which is capped at 100 %, is used to measure the FPB, subject to future revisions.

If the NPR is greater than 100%, and therefore capped at 100 %, the liability is increased and expensed immediately to reflect the amount necessary for net premiums to equal gross premiums.

As the liability assumptions are reviewed and updated, if deemed necessary, at least annually, if conditions improve whereby the contracts are no longer expected to have net premiums in excess of gross premiums, the improvements would be captured in the remeasurement process and reflected in the accompanying Consolidated Statements of Earnings in the period of improvement.

For traditional life policies and life-contingent immediate annuity policies (which includes life-contingent PRT annuities), the discount rate assumption is an equivalent single rate that is derived based on A-credit-rated fixed-income instruments with similar duration to the liability.

We selected fixed-income instruments that have been A-rated by Bloomberg.

In order to reflect the duration characteristics of the liability, we will use an implied forward yield curve and linear interpolation will be used for durations that have limited or no market observable points on the curve.

The discount rate assumption is updated quarterly and used to remeasure the liability at the reporting date, with the resulting change reflected in the accompanying Consolidated Statements of Comprehensive Earnings.

Deferred Profit Liability

For life-contingent immediate annuity policies, gross premiums received in excess of net premiums are deferred at initial recognition as a DPL.

Gross premiums are measured using assumptions consistent with those used in the measurement of the related liability for FPBs, including discount rate, mortality, and expenses.

The DPL is amortized and recognized as premium revenue with the amount of expected future benefit payments, discounted using the same discount rate determined and locked-in at contract issuance that is used in the measurement of the related FPB.

Interest is accreted on the balance of the DPL using this same discount rate.

We periodically review and update our estimates using the actual historical experience and updated cash flows for the DPL at the same time as the estimates of cash flows for the FPB.

When cash flows are updated, the updated estimates are used to recalculate the initial DPL at contract issuance.

The recalculated DPL as of the beginning of the current reporting period is compared to the carrying amount of the DPL as of the beginning of the current reporting period, with any differences recognized as a remeasurement gain or loss, presented parenthetically within Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

The DPL is recorded as a component of the Future policy benefits in the accompanying Consolidated Balance Sheets.

Market Risk Benefits

MRBs are contracts or contract features that both provide protection to the contract holder from other-than-nominal capital market risk (equity, interest rate and foreign exchange risk) and expose the Company to other-than-nominal capital market risk.

MRBs include certain contract features primarily on FIA products that provide minimum guarantees to policyholders, such as guaranteed minimum death benefit ("GMDB"), guaranteed minimum withdrawal benefit ("GMWB") riders and guaranteed minimum accumulation benefit ("GMAB") riders.

MRBs are measured at fair value using an attributed fee measurement approach where attributed fees are explicit rider charges collectible from the policyholder used to cover the excess benefits, which represent expected benefits in excess of the policyholder’s account value.

At contract inception, an attributed fee ratio is calculated equal to rider charges over benefits paid in excess of the account value attributable to the MRBs.

The attributed fee ratio remains static over the life of the MRB and is capped at 100 %.

Each period subsequent to contract inception, the attributed fee ratio is used to calculate the fair value of the MRBs using a risk neutral valuation method and is based on current net amounts at risk, market data, internal and industry experience, and other factors.

The balances are computed using assumptions including mortality, full and partial surrender, GMWB utilization, risk-free rates including non-performance spread and risk margin, market value of options and economic scenarios.

Policyholder behavior assumptions are reviewed at least annually, typically in the third quarter, for any revisions.

MRBs can either be in an asset or liability position and are presented separately on the Consolidated Balance Sheets as the right of setoff criteria are not met.

Changes in fair value are recognized in Market risk benefits gain (losses) in the accompanying Consolidated Statements of Earnings, except for the change in fair value due to a change in the instrument-specific credit risk,

which is recognized in the accompanying Consolidated Statements of Comprehensive Earnings.

See a description of the fair value methodology used in Note D Fair Value of Financial Instruments and Note X Market Risk Benefits .

Reserve for Title Claim Losses

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In our F&G segment, our insurance subsidiaries enter into reinsurance agreements with other companies in the normal course of business.

For arrangements in which F&G follows reinsurance accounting and for most arrangements that are accounted for as separate investment contracts, we present the amounts consistently and on a gross basis in our Consolidated Balance Sheets with the ceded reserves balance presented as a Reinsurance recoverable.

Where applicable, deferred gains associated with the reinsurance of insurance and investment contracts will be included within Accounts payable and accrued expenses with the related accretion reflected within Escrow, title-related and other fees on the Consolidated Balance Sheets and Statements of Earnings, respectively.

Where applicable, deferred costs associated with the reinsurance of insurance and

investment contracts will be included within the Prepaid expense and other assets with the related amortization reflected within Other operating expenses in the Consolidated Balance Sheets and Statements of Earnings, respectively.

Premium and expense are recorded net of reinsurance ceded for both insurance and investment contracts.

For some arrangements in which deposit accounting is applied or the arrangement is accounted for as a separate investment contract, the assets and liabilities of certain reinsurance contracts are presented on a net basis in the accompanying Consolidated Balance Sheets.

The related net investment income, investment gain/loss, and change in reserves are presented net on the accompanying Consolidated Statements of Income.

For arrangements that meet the criteria to be accounted for as reinsurance, we present the amounts consistently and on a gross basis in our Consolidated Balance Sheets with the ceded reserves balance presented as a Reinsurance recoverable.

Deferred gains will be included within Accounts payable and accrued expenses with the related accretion reflected within Life insurance premiums and other fees on the Consolidated Balance Sheets and Statements of Earnings, respectively.

Deferred costs will be included within the Prepaid expense and other assets with the related amortization reflected within Other operating expenses in the Consolidated Balance Sheets and Statements of Earnings, respectively.

Premium and expense are recorded net of reinsurance ceded.

For arrangements in which the underlying contracts do not include insurance risk or do not meet the criteria to be accounted for as reinsurance, the arrangements are accounted for as separate investment contracts or deposit accounting is applied, respectively.

In both cases, we calculate a deposit asset based on the actual and expected cash flows associated to each arrangement and use the interest method to accrete the deposit asset using an effective yield based on changes in actual and expected cash flows.

The deposit asset is presented within Reinsurance recoverable on the Consolidated Balance Sheets and the accretion of the deposit asset is presented within Benefits and other changes in policy reserves on the accompanying Consolidated Statements of Earnings.

For certain arrangements that are not accounted for as reinsurance, the right of offset is applied when there is a right of offset explicit in the reinsurance agreement.

This results in the assets and liabilities associated with the arrangement presented on a net basis in the accompanying Consolidated Balance Sheets, and the related net investment income, investment gain/loss, and change in deposit asset are presented net on the accompanying Consolidated Statements of Earnings.

F&G intends to apply the right of offset where there is a right of offset explicit in the reinsurance agreement.

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Benefits and Other Changes in Policy Reserves

Benefit expenses for FIAs, fixed rate annuities, IUL policies and funding agreements include interest credited and, for FIA and IUL policies, index credits, to contractholder account balances.

Benefit expenses for deferred annuities (FIAs and fixed rate annuities), IUL policies and funding agreements include interest credited, fixed interest, floating interest (specific to funding agreements) and/or index credits (specific to FIA and IUL policies), to contractholder account balances.

Benefit claims in excess of contract account balances, net of reinsurance recoveries, are charged to expense in the period that they are earned by the policyholder based on their selected strategy or strategies.

Interest crediting rates associated with funds invested in the general account of our insurance subsidiaries range from 0.5 % to 6.0 % for fixed rate annuities and FIAs combined, 3.0 % to 4.8 % for IULs, and 0.9 % to 5.2 % for funding agreements.

Other changes in policy reserves include the change in the fair value of the FIA embedded derivative and the change in the SOP 03-1 reserve for GMWB and GMDB benefits.

Other changes in policy reserves include the change in the fair value of the FIA embedded derivative.

Other changes in policy reserves also include the change in reserves for life insurance products.

For traditional life and immediate annuities (which includes PRT annuities with life contingencies), policy benefit claims are charged to expense in the period that the claims are incurred, net of reinsurance recoveries.

For traditional life and life-contingent immediate annuities (which includes PRT annuities with life contingencies), policy benefit claims are charged to expense in the period that the claims are incurred, net of reinsurance recoveries.

Remeasurement gains or losses on the related FPB and DPL balances are presented parenthetically within Benefits and other changes in policy reserves in the accompanying Consolidated Statements of Earnings.

Stock-Based Compensation Plans

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Amounts reclassified to net earnings relate to the realized gains (losses) on our investments and other financial instruments, excluding investments in unconsolidated affiliates, and are included in Recognized gains and losses, net on the Consolidated Statements of Earnings.

Changes in the balance of Other comprehensive earnings (loss) by component are as follows:

Unrealized gain (loss) on investments and other financial instruments, net (excluding investments in unconsolidated affiliates) Unrealized gain (loss) relating to investments in unconsolidated affiliates Unrealized (loss) gain on foreign currency translation and cash flow hedging Minimum pension liability adjustment Total Accumulated Other Comprehensive Earnings (Loss)

Changes in the balance of Other comprehensive earnings (loss) for the years ended December 31, 2023, 2022 and 2021, by component are as follows:

Unrealized gain (loss) on investments and other financial instruments, net (excluding investments in unconsolidated affiliates) Change in current discount rate - future policy benefits Change in instrument-specific credit risk - market risk benefits Other Total Accumulated Other Comprehensive Earnings (Loss)

(In millions)

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Other comprehensive earnings ( 4,783 ) 764 67 ( 4 ) ( 3,956 )

Non-controlling interest 33 — 1 1 35

Balance December 31, 2022 ( 3,771 ) 966 ( 62 ) ( 3 ) ( 2,870 )

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Other comprehensive earnings 961 ( 189 ) ( 34 ) 21 759

Non-controlling interest ( 178 ) 38 7 ( 1 ) ( 134 )

Balance December 31, 2023 $ ( 2,793 ) $ 764 $ ( 96 ) $ 6 $ ( 2,119 )

Redeemable Non-controlling Interest

Subsequent to our acquisition of Lender Processing Services, Inc.

("LPS") in January 2014, we issued a 35 % ownership interest in ServiceLink to funds affiliated with Thomas H.

Lee Partners ("THL" or "the minority interest holder").

THL had an option to put its ownership interests of ServiceLink to us if no public offering of the corresponding business was consummated after four years from the date of FNF's purchase of LPS.

The Class A units owned by THL (the "redeemable noncontrolling interests") could have been settled in cash or common stock of FNF or a combination of both at our election.

As of January 2018, no public offering was made and the redeemable noncontrolling interests were no longer subject to a holding requirement.

The redeemable noncontrolling interests were settled at the current fair value at the time we received notice of THL's put election as determined by the parties or by a third-party appraisal under the terms of the Unit Purchase Agreement.

As a result of a recapitalization of ServiceLink in 2015, the ownership interest by the minority interest holder was reduced from 35 % to 21 %.

The redeemable noncontrolling interests were recorded at their initial value of $ 344 million in our Consolidated Balance Sheets and would have been adjusted to fair value were such value to rise above the initial value.

As these redeemable noncontrolling interests provided for redemption features not solely within our control, we classified the redeemable noncontrolling interests outside of permanent equity.

On July 29, 2020, we purchased for $ 90 million the outstanding Class A units of ServiceLink held by THL.

As of the purchase date, ServiceLink is a wholly-owned subsidiary of FNF.

Management Estimates

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Actual results could differ from those estimates.

Periodically, and at least annually, typically in the third quarter, we review the assumptions associated with reserves for policy benefits, product guarantees, and amortization of intangibles.

During the fourth quarter of 2022, based on increases in interest rates and pricing changes during 2022, we updated certain FIA assumptions used to calculate the fair value of the embedded derivative component within contractholder funds and certain assumptions used to calculate SOP 03-1 liabilities and intangible balances.

These changes, taken together, resulted in an increase in contractholder funds and future policy reserves of $ 96 million and an increase to intangible assets of $ 47 million.

Periodically, and at least annually, typically in the third quarter, we review the assumptions associated with reserves for policy benefits and product guarantees.

During the third quarter of 2023 and for the year ended December 31, 2023, based on increases in interest rates and pricing changes, we updated certain FIA assumptions to calculate the fair value of the embedded derivative component within the contractholder funds and also aligned reserves to actual policyholder behavior.

These changes resulted in an increase in total benefits and other changes in policy reserves of approximately $ 73 million.

These changes, taken together, resulted in an increase in contractholder funds and market risk benefits of $ 99 million .

During the third quarter of 2021, we implemented a new actuarial valuation system.

As a result, our third quarter 2021 assumption updates include model refinements and assumption updates resulting from the implementation.

The system implementation and assumption review process that occurred in the third quarter of 2021 included refinements in the calculation of the fair value of the embedded derivative component of our FIAs within contractholder funds and updates to the surrender rates, GMWB utilization, IUL premium persistency, maintenance expenses, and earned rate assumptions to reflect our current and expected future experience.

These changes, taken together, resulted in a decrease in contractholder funds and future policy reserves of $ 425 million and a decrease to intangible assets of $ 136 million.

These model refinements and assumptions are also used in the SOP 03-1 liability for GMWB and GMDB benefits and resulted in an increase in the liability of $ 28 million.

There was no material change to underlying policyholder behavior.

The majority of the changes represent one-time adjustments in the

third quarter of 2021 related to the cumulative impact of the system implementation and are not expected to re-occur in the future.

The system implementation and assumption review process that occurred in the third quarter of 2021, included refinements in the calculation of the fair value of the embedded derivative component of our FIAs within contractholder funds and updates to the surrender rates, GMWB utilization and earned rate assumptions to reflect our current and expected future experience.

These changes, taken together, resulted in a decrease in contractholder funds and future policy reserves of $ 435 million.

The majority of the changes represent one-time adjustments in the third quarter of 2021 related to the cumulative impact of the system implementation and are not expected to re-occur in the future.

Owned Distribution Investments

For the years ended December 31, 2023 and 2022, we expensed approximately $ 154 million and $ 74 million in commissions on sales through our funded owned distribution investments and their affiliates, respectively, with the acquisition expense deferred and amortized in Depreciation and amortization on the accompanying Consolidated Statements of Earnings.

Note B — Acquisitions

On January 1, 2023, we completed our previously announced acquisition of TitlePoint for $ 224 million in cash, subject to a customary working capital adjustment.

The acquisition was accounted for as a business combination under FASB Accounting Standards Codification Topic 805, Business Combinations ("Topic 805").

The purchase price has been allocated to TitlePoint's assets acquired based on their fair values as of the acquisition date.

Goodwill has been recorded based on the amount that the purchase price exceeds the fair value of the net assets acquired.

Goodwill consists primarily of intangible assets that do not qualify for separate recognition.

The goodwill recorded is expected to be deductible for tax purposes.

We completed our assessment of the fair value of assets acquired and liabilities assumed within the one-year period from the date of acquisition.

In connection with the acquisition, we recorded fair value estimates for goodwill, other intangible assets and other assets of $ 165 million, $ 54 million and $ 6 million, respectively, as of December 31, 2023.

The gross carrying value and weighted average estimated useful lives of Other intangible assets acquired in the TitlePoint acquisition consist of the following:

Gross Carrying Value Weighted Average

Estimated Useful Life

Other intangible assets:

(In millions)

Customer relationships $ 3 10

Trade name 4 10

Software 47 7

Total Other intangible assets $ 54

On August 9, 2022, we acquired approximately 74 % of the outstanding equity of AllFirst for approximately $ 130 million in cash consideration.

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The goodwill recorded is expected to be deductible for tax purposes.

In connection with the acquisition, we recorded preliminary fair value estimates for goodwill, other intangibles, other assets, other liabilities and non-controlling interest of $ 105 million, $ 55 million, $ 40 million, $ 19 million and $ 46 million, respectively, as of December 31, 2022.

We completed our assessment of the fair value of assets acquired and liabilities assumed within the one-year period from the date of acquisition.

We recorded fair value amounts as of the acquisition date for goodwill, other intangibles, other assets, other liabilities and non-controlling interest of $ 104 million, $ 55 million, $ 40 million, $ 18 million and $ 46 million, respectively, as of December 31, 2023.

The gross carrying value and weighted average estimated useful lives of Other intangible assets acquired in the AllFirst acquisition consist of the following (dollars in millions):

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Total Other intangible assets $ 55

On June 1, 2020, we acquired 100 % of the outstanding equity of F&G for approximately $ 2.7 billion pursuant to the Agreement and Plan of Merger, dated February 7, 2020, as amended (the "Merger Agreement").

In connection with the Merger, we issued approximately 24 million shares of FNF common stock and paid approximately $ 1.8 billion in cash to former holders of F&G ordinary and preferred shares.

On August 26, 2020, we issued an additional 1 million shares of FNF common stock and paid approximately $ 100 million in cash to Kingfishers, LP., Kingstown Partners Master, LTD., Kingstown Partners II, LP., Kingstown 1740 Fund, LP.

and Ktown, LP.

(collectively the "Kingstown Dissenters"), who are former owners of F&G common stock.

For more information related to the Kingstown Dissenters, refer to Note H Commitments and Contingencies .

At closing, all outstanding shares of F&G common stock, excluding shares associated with the liability to former owners, were converted into the right to receive the Merger Consideration (as defined in the Merger Agreement).

Additionally, each outstanding F&G Option and F&G Phantom unit was canceled and converted into options to purchase FNF common stock and phantom units denominated in FNF common stock, and each outstanding warrant to purchase F&G common stock was converted into the right to purchase and receive upon exercise $ 8.18 in cash and .0833 shares of FNF common stock.

At closing, our subsidiaries' ownership of F&G common and preferred shares was converted into approximately 7 million shares of FNF common stock, which are reflected as treasury shares in the accompanying Consolidated Financial Statements.

The initial purchase price is as follows (in millions):

Cash paid for outstanding F&G shares $ 1,903

Cash Acquired 827

Net cash paid for F&G 1,076

Value of FNF share consideration 806

Value of outstanding converted equity awards attributed to services already rendered 28

Total net consideration paid $ 1,910

The acquisition was accounted for as a business combination under Topic 805.The purchase price was allocated to F&G's assets acquired and liabilities assumed based on their fair values as of the acquisition date.

Goodwill has been recorded based on the amount that the purchase price exceeds the fair value of the net assets acquired.

Goodwill consists primarily of intangible

assets that do not qualify for separate recognition.

The goodwill recorded is not expected to be deductible for tax purposes, except for $ 16 million related to a prior F&G transaction.

Pursuant to Topic 805, the financial statements were not retrospectively adjusted for any provisional amount changes that occurred during the measurement period.

Rather, we recognized provisional adjustments as we obtained information not available as of the completion of the preliminary fair value calculation.

We also recorded, in the same period as the financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, as a result of any changes to the provisional amounts, calculated as if the accounting had been completed at the acquisition date.

The following table summarizes the fair value amounts recognized for the assets acquired and liabilities assumed as of the acquisition date (in millions):

Fixed maturity securities $ 22,389

Preferred securities 876

Equity securities 52

Derivative instruments 313

Mortgage loans 1,755

Investments in unconsolidated affiliates 1,049

Other long-term investments 430

Short-term investments 37

Trade and notes receivable 1

Reinsurance recoverable 2,998

Goodwill 1,756

Prepaid expenses and other assets 379

Lease assets 8

Other intangible assets 2,107

Deferred tax asset 269

Assets of discontinued operations 2,392

Total assets acquired 36,811

Contractholder funds 26,451

Future policy benefits 3,871

Accounts payable and accrued liabilities 897

Notes payable 589

Funds withheld for reinsurance liabilities 816

Lease liabilities 9

Liabilities of discontinued operations 2,268

Total liabilities assumed 34,901

Net assets acquired $ 1,910

The gross carrying value and weighted average estimated useful lives of Other intangible assets acquired in the F&G acquisition consist of the following (dollars in millions):

Gross Carrying Value Estimated Useful Life

Other intangible assets:

Value of business acquired $ 1,908 Various

Value of distribution network acquired 140 15

Trademarks and licenses 38 10

Software 21 2

Total Other intangible assets $ 2,107

We completed our assessment of the fair value of assets acquired and liabilities assumed within the one-year period from the date of acquisition.

During the year ended December 31, 2021, we recorded measurement period adjustments as of the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of the acquisition date.

Such adjustments resulted in a decrease in Reinsurance recoverable of approximately $ 289 million, an increase in Other intangible assets of approximately $ 61 million, a decrease in Future policy benefits of $ 227 million and various other, individually immaterial items.

There was no material impact on Consolidated Statements of Earnings as a result of the measurement period adjustments recorded.

Unaudited Supplemental Pro-forma Financial Results

F&G's financial results since the acquisition date are reflected in our Consolidated Financial Statements.

F&G's revenues and net earnings for the period from June 1, 2020 through December 31, 2020 of $ 1,233 million and $ 136 million, respectively, are included in the Consolidated Statements of Earnings for the year ended December 31, 2020.

For comparative purposes, selected unaudited pro-forma consolidated results of operations of FNF for the year ended December 31, 2020 is presented below.

Unaudited pro-forma results presented assume the consolidation of F&G occurred as of January 1, 2019.

Year Ended December 31,

(In millions)

Total revenues $ 10,897

Net earnings attributable to FNF common shareholders 1,233

Amounts reflect certain pro forma adjustments to revenue and net earnings that were directly attributable to the acquisition, and for the elimination of historical activity between FNF and F&G prior to the acquisition.

These adjustments include the following:

• elimination of valuation changes on FNF's investment in F&G common and preferred shares prior to the acquisition;

• elimination of dividends received by FNF related to its holdings of F&G's common and preferred shares prior to the acquisition;

• elimination of advisory fees F&G paid to FNF;

• elimination of transaction costs paid by F&G;

• adjustment to record interest expense related to financing associated with the acquisition;

• adjustment to reflect the elimination of historical amortization of F&G intangibles and the additional amortization of F&G intangibles measured at fair value as of the acquisition date;

• adjustment to reflect the prospective reclassification from accumulated other comprehensive earnings of the unrealized gains on available-for-sale securities to a premium, which will be amortized into income based on the expected life of the investment securities.

Note C — Summary of Reserve for Title Claim Losses

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, was filed in San Diego County Superior Court by the receiver on behalf of the receivership entities against the Named Companies.

The receiver seeks compensatory, incidental, consequential, and punitive damages, and seeks the recovery of attorneys’ fees.

The receiver sought compensatory, incidental, consequential, and punitive damages, and the recovery of attorneys’ fees.

In turn, the Named Companies petitioned the federal court to sue ANI, via the receiver, to pursue indemnity and other claims against the receivership entities as joint tortfeasors, which was granted.

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On November 23, 2022, the federal court overruled any objections by non-joining investors and entered an order approving the global settlement and barring further claims against the Named Companies (“Settlement and Bar Order”).

The receiver’s lawsuit against the Named Companies has been dismissed.

The receiver is in receipt of the settlement payment from Chicago Title Company and will distribute the amount designated for each non-joining investor at the conclusion of any such investor’s appeal of the Settlement and Bar Order (or back to Chicago Title Company if an appeal is successful).

Some of the investor claimants who objected to entry of the Settlement and Bar Order have appealed the decision to the United States Court of Appeals for the Ninth Circuit by (Cases 22-56206, 22-56208, and 23-55083).

Appellate briefing is expected to take place over the next several months.

Some of the investor claimants who objected to entry of the Settlement and Bar Order appealed the decision to the United States Court of Appeals for the Ninth Circuit by (Cases 22-56206, 22-56208, and 23-55083), and appellate oral argument is expected to be held later this year.

After filing its appeal, one of the appellants, CalPrivate Bank (Case 23-55083), entered into a settlement with the receiver that was approved by the federal court.

This settlement resolves CalPrivate Bank’s objections to the Settlement and Bar Order, and its appeal has been dismissed.

The following lawsuits remain pending in the Superior Court of San Diego County for the State of California, all of which involve investor claimants who have claims against the Named Companies, objected to the settlement with the receiver, and have appealed the Settlement and Bar Order.

Since any pending and future claims against the Named Companies are barred, the state court cases where plaintiffs have served a notice of appeal have been stayed pending the outcome of the appeals, and the claims against the Named Companies by non-appealing plaintiffs have been dismissed with prejudice.

While they have not been consolidated into one action, they have been deemed by the court to be related and are assigned to the same judge for purposes of judicial economy.

While they have not been

consolidated into one action, they have been deemed by the court to be related and are assigned to the same judge for purposes of judicial economy.

On Decem ber 13, 2019, a lawsuit styled, Kim Funding, LLC, Kim H.

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Cross-complaint plaintiff has, in turn, sued the Named Companies in that action seeking in excess of $ 250 million in monetary losses as well as exemplary damages and attorneys’ fees.

As a result of the receiver’s settlement with CalPrivate Bank, the receiver has been substituted in as the plaintiff in the suit against the trustee.

On November 2, 2020, a lawsuit styled, C alPrivate Bank v.

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Champion-Cain, and others.

Given CalPrivate Bank’s settlement with the receiver, this action against the Named Companies will be dismissed.

Chicago Title Company has also resolved a number of other pre-suit claims and previously-disclosed lawsuits from both individual and groups of alleged investors under confidential terms.

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In addition to the unobservable inputs, Level 3 fair value investments may include observable components, which are components that are actively quoted or can be validated to market-based sources.

The carrying amounts and estimated fair values of our financial instruments for which the disclosure of fair values is required, including financial assets and liabilities measured and carried at fair value on a recurring basis, with the exception of investment contracts, portions of other long-term investments and debt, which are disclosed later within this footnote, was summarized according to the hierarchy previously described, as follows (in millions):

December 31, 2023

Level 1 Level 2 Level 3 NAV Fair Value

Assets (In millions)

Cash and cash equivalents $ 2,767 $ — $ — $ — $ 2,767

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Derivative investments — 740 57 — 797

Reinsurance related embedded derivative, included in other assets — 279 — — 279

Investments in unconsolidated affiliates — — 285 — 285

Short term investments 2,111 8 — — 2,119

Reinsurance related embedded derivative, included in other assets — 152 — — 152

Other long-term investments — — 37 — 37

Market risk benefits asset — — 88 — 88

Total financial assets at fair value $ 6,566 $ 33,703 $ 9,677 $ 59 $ 50,005

FIA/ IUL embedded derivatives, included in contractholder funds — — 4,258 — 4,258

Market risk benefits liability — — 403 — 403

Derivative instruments - futures contracts 1 — — 1

Total financial liabilities at fair value $ 1 $ — $ 4,661 $ — $ 4,662

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Level 1 Level 2 Level 3 NAV Fair Value

Assets (In millions)

Cash and cash equivalents $ 2,286 $ — $ — $ — $ 2,286

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Derivative investments — 244 — — 244

Investment in unconsolidated affiliates — — 23 — 23

Reinsurance related embedded derivative, included in other assets — 279 — — 279

Short term investments 2,590 — — — 2,590

Market risk benefits asset — — 117 — 117

Other long-term investments — — 48 — 48

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FIA/ IUL embedded derivatives, included in contractholder funds — — 3,115 — 3,115

Reinsurance related embedded derivatives, included in other liabilities — 73 — — 73

Market risk benefits liability — — 282 — 282

Total financial liabilities at fair value $ — $ — $ 3,397 $ — $ 3,397

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Derivative Financial Instruments

The fair value of call options is based upon valuation pricing models, which represents what we would expect to receive or pay at the balance sheet date if we canceled the options, entered into offsetting positions, or exercised the options.

Fair values for these instruments are determined internally, based on industry accepted valuation pricing models, which use market-observable inputs, including interest rates, yield curve volatilities, and other factors.

The fair value of futures contracts (specifically for FIA contracts) represents the cumulative unsettled variation margin (open trade equity, net of cash settlements), which represents what we would expect to receive or pay at the balance sheet date if we canceled the contracts or entered into offsetting positions.

These contracts are classified as Level 1.

Our call options, futures contracts, and interest rate swaps can either be exchange traded or over the counter.

Exchange traded derivatives typically fall within Level 1 of the fair value hierarchy if there is active trading activity.

Two methods are used to value over-the-counter derivatives.

When required inputs are available, certain derivatives are valued using valuation pricing models, which represent what we would expect to receive or pay at the balance sheet date if we cancelled or exercised the derivative, or entered into offsetting positions.

Valuation models require a variety of inputs, which include the use of market-observable inputs, including interest rate, yield curve volatilities, and other factors.

These over-the-counter derivatives are typically classified within Level 2 of the fair value hierarchy as the majority trade in liquid markets, we can verify model inputs and model selection does not involve significant management judgment.

When inputs aren’t available for valuation models, certain over-the-counter derivatives are valued using independent broker quotes, which are based on unobservable market data and classified within Level 3.

The fair value measurement of the FIA/IUL embedded derivatives included in contractholder funds is determined through a combination of market observable information and significant unobservable inputs using the option budget method.

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Generally, a change in any one unobservable input would not directly result in a change in any other unobservable input.

Also refer to Management's Estimates in Note A Business and Summary of Significant Accounting Policies regarding updated assumptions during the fourth quarter of 2022 and the implementation of a new actuarial valuation system and assumption updates during third quarter of 2021.

The system implementation and assumption review process included refinements in the calculation of the fair value of the embedded derivative component of our fixed indexed annuities.

The fair value of the reinsurance-related embedded derivatives in the funds withheld reinsurance agreements with Kubera Insurance (SAC) Ltd.

("Kubera") (effective October 31, 2021, this agreement was novated from Kubera to Somerset Reinsurance Ltd.

("Somerset"), a certified third-party reinsurer) and ASPIDA Life Re Ltd ("Aspida Re") are estimated based upon the fair value of the assets supporting the funds withheld from reinsurance liabilities.

The fair value of the assets is based on a quoted market price of similar assets (Level 2) and;

therefore, the fair value of the embedded derivative is based on market-observable inputs and classified as Level 2.

Please see Note O F&G Reinsurance for further discussion on F&G reinsurance agreements.

Also refer to Management's Estimates in Note A - Business and Summary of Significant Accounting Policies regarding certain assumption updates.

The fair value of the reinsurance-related embedded derivatives in the funds withheld reinsurance agreements are estimated based upon the fair value of the assets supporting the funds withheld from reinsurance liabilities.

The fair value of the assets is based on a quoted market price of similar assets (Level 2), and therefore the fair value of the embedded derivative is based on market-observable inputs and classified as Level 2.

See Note E - Reinsurance for further discussion on F&G reinsurance agreements.

Investments in Unconsolidated affiliates

We have elected the fair value option for certain investments in unconsolidated affiliates as we believe this better aligns them with other investments in unconsolidated affiliates that are measured using NAV as a practical expedient in determining fair value.

Investments measured using the fair value option are included in Level 3 and the fair value of these investments are determined using a multiple of the affiliates’ EBITDA, which is derived from market analysis of transactions involving comparable companies.

The EBITDA used in this calculation is based on the affiliates’ financial information.

The inputs are usually considered unobservable, as not all market participants have access to this data.

Short-term Investments

The carrying amounts reported in the Consolidated Balance Sheets for these instruments approximate fair value.

Other long-term investments

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The fair value of the credit-linked note is based on a weighted average of a broker quote and a discounted cash flow analysis.

The discounted cash flow approach is based on the expected portfolio cash flows and amortization schedule reflecting investment expectations, adjusted for assumptions on the portfolio's default and recovery rates, and the note's discount rate.

The discounted cash flow approach is based on the expected portfolio cash flows and amortization schedule reflecting

investment expectations, adjusted for assumptions on the portfolio's default and recovery rates, and the note's discount rate.

The fair value of the note is provided by the fund manager at the end of each quarter.

Quantitative information regarding significant unobservable inputs used for recurring Level 3 fair value measurements of financial instruments carried at fair value as of December 31, 2023 and December 31, 2022, excluding assets and liabilities for which significant quantitative unobservable inputs are not developed internally and not readily available to the Company (primarily those valued using broker quotes and certain third-party pricing services) are as follows:

Fair Value at Valuation Technique Unobservable Input(s) Range (Weighted average)

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(in millions) December 31, 2023

Asset-backed securities $ 5,916 Broker-quoted Offered quotes 52.85 % - 117.17 % ( 94.18 %)

Asset-backed securities 347 Third-Party Valuation Offered quotes 41.43 % - 210.50 % ( 67.99 %)

Commercial mortgage-backed securities 20 Broker-quoted Offered quotes 109.02 % - 109.02 % ( 109.02 %)

Commercial mortgage-backed securities 17 Third-Party Valuation Offered quotes 74.66 % - 88.48 % ( 82.74 %)

Corporates 602 Broker-quoted Offered quotes 79.16 % - 102.53 % ( 94.16 %)

Corporates 826 Third-Party Valuation Offered quotes — % - 104.96 % ( 89.69 %)

Asset-backed securities $ 57 Third-Party Valuation Discount Rate 5.09 % - 6.95 %

Corporates 787 Third-Party Valuation Discount Rate 0.00 % - 12.87 %

Corporates 8 Discounted Cash Flow Discount Rate 44.00 % - 100.00 %

Municipals 29 Third-Party Valuation Offered quotes 93.95 % - 93.95 % ( 93.95 %)

Residential mortgage-backed securities 302 Broker-quoted Offered quotes 0.00 % - 91.04 % ( 86.38 %)

Foreign Governments 16 Third-Party Valuation Offered quotes 99.78 % - 102.29 % ( 100.56 %)

Municipals 32 Third-Party Valuation Discount Rate 6.25 % - 6.25 %

Residential mortgage-backed securities 3 Third-Party Valuation Discount Rate 5.46 %- 5.46 %

Foreign Governments 16 Third-Party Valuation Discount Rate 6.94 % - 7.68 %

Investment in unconsolidated affiliates 285 Market Comparable Company Analysis EBITDA Multiple 4.4 x - 31.8 x

Preferred securities 1 Discounted Cash Flow Discount rate 100.00 %

Equity securities 6 Broker Quoted Offered quotes $ 64.25 - $ 64.25

Equity securities 7 Discounted Cash Flow Discount rate 11.50 % - 11.50 % ( 11.50 %)

Market Comparable Company Analysis EBITDA multiple 5.6 x - 5.6 x ( 5.6 x)

Other long-term investments:

Available-for-sale embedded derivative 28 Black Scholes Model Market Value of Fund 100.00 %

Secured borrowing receivable 10 Broker-quoted Offered quotes 100.00 % - 100.00 % ( 100.00 %)

Credit Linked Note 15 Broker-quoted Offered quotes 96.23 %

Investment in affiliate 23 Market Comparable Company Analysis EBITDA multiple 5 x - 5.5 x

Total financial assets at fair value $ 8,169

Market risk benefits asset 88 Discounted Cash Flow Mortality 100.00 % - 100.00 %

Surrender Rates 0.25 % - 10.00 %

Partial Withdrawal Rates — % - 23.26 %

Non-Performance Spread 0.38 % - 1.10 %

GMWB Utilization 50.00 % - 60.00 %

Total financial assets at fair value (a) $ 1,312

FIA/ IUL embedded derivatives, included in contractholder funds $ 4,258 Discounted Cash Flow Market Value of Option 0.00 % - 18.93 %

5 unchanged sentences

Option cost 0.07 % - 5.48 % ( 2.38 %)

Market risk benefits liability 403 Discounted Cash Flow Mortality 100.00 % - 100.00 %

Surrender Rates 0.25 % - 10.00 %

Partial Withdrawal Rates — % - 23.26 %

Non-Performance Spread 0.38 % - 1.10 %

GMWB Utilization 50.00 % - 60.00 %

Total financial liabilities at fair value $ 4,661

(a) Excludes $$ 8,365 million of assets for which significant quantitative unobservable inputs are not developed internally and not readily available to the Company (primarily those valued using broker quotes and certain third-party pricing services)

Fair Value at Valuation Technique Unobservable Input(s) Range (Weighted average)

December 31, 2021 December 31, 2021

Asset-backed securities $ 3,844 Broker-quoted Offered quotes 52.56 % - 260.70 % ( 97.06 %)

Asset-backed securities 115 Third-Party Valuation Offered quotes 93.02 % - 108.45 % ( 104.95 %)

Commercial mortgage-backed securities 24 Broker-quoted Offered quotes 126.70 % - 126.70 % ( 126.70 %)

Commercial mortgage-backed securities 11 Third-Party Valuation Offered quotes 97.91 % - 97.91 % ( 97.91 %)

Corporates 380 Broker-quoted Offered quotes — % - 109.69 % ( 100.91 %)

Corporates 741 Third-Party Evaluation Offered quotes 85.71 % - 119.57 % ( 107.72 %)

December 31, 2022

(In millions) December 31, 2022

Asset-backed securities $ 91 Third-Party Valuation Discount Rate 5.23 % - 8.98 %

Corporates 796 Third-Party Valuation Discount Rate 4.75 % - 12.45 %

Corporates 12 Discounted Cash Flow Discount Rate 44.00 % - 100.00 % ( 77.02 %)

Municipals 43 Third-Party Evaluation Offered quotes 135.09 % - 135.09 % ( 135.09 %)

Short-term 321 Broker-quoted Offered quotes 100.00 % - 100.00 % ( 100.00 %)

Foreign governments 18 Third-Party Evaluation Offered quotes 107.23 % - 116.44 % ( 110.11 %)

Preferred Securities 2 Income-Approach Yield 2.43 %

Equity securities 3 Broker-quoted Offered Quotes $ 6.23 - $ 6.23 ($ 6.23 )

Equity securities 2 Black Scholes Model Risk Free Rate 1.00 % - 1.00 % ( 1.00 %)

Strike Price $ 1.50 - $ 1.50 ($ 1.50 )

Volatility 81.00 % - 81.00 % ( 81.00 %)

Dividend Yield 0.00 % - 0.00 % ( 0.00 %)

Municipals 29 Third-Party Evaluation Discount Rate 7.62 % - 7.62 %

Foreign governments 16 Third-Party Evaluation Discount Rate 5.99 % - 6.28 %

Investment in unconsolidated affiliates 23 Market Comparable Company Analysis EBITDA multiple 5 x- 5.50 x

Preferred Securities 1 Discounted Cash Flow Discount rate 100.00 %

Equity securities 4 Discounted Cash Flow Discount Rate 11.10 % - 11.10 % ( 11.10 %)

Market Comparable Company Analysis EBITDA multiple 5.9 x - 5.9 x ( 5.9 x)

Other long-term investments:

Available-for-sale embedded derivative 23 Black Scholes model Market value of fund 100.00 %

Credit Linked Note 23 Broker-quoted Offered quotes 100.00 %

Investment in affiliate 21 Market Comparable Company Analysis EBITDA multiple 8 x - 8 x

Total financial assets at fair value $ 5,600

Market risk benefits asset 117 Discounted Cash Flow Mortality 100.00 % - 100.00 % ( 100.00 %)

Surrender Rates 0.25 % - 10.00 %

Partial Withdrawal Rates 2.00 % - 21.74 %

Non-Performance Spread 0.48 % - 1.44 %

GMWB Utilization 50.00 % - 60.00 % ( 50.94 %)

Total financial assets at fair value (a) $ 1,112

FIA/ IUL embedded derivatives, included in contractholder funds $ 3,115 Discounted cash flow Market value of option 0.00 % - 23.90 %

5 unchanged sentences

Option cost 0.07 % - 4.97 %

Market risk benefits liability 282 Discounted Cash Flow Mortality 100.00 % - 100.00 % ( 100.00 %)

Surrender rates 0.25 % - 10.00 %

Partial withdrawal rates 2.00 % - 21.74 %

Non-performance spread 0.48 % - 1.44 %

GMWB utilization 50.00 % - 60.00 % ( 50.94 %)

Total financial liabilities at fair value $ 3,397

(a) Excludes $ 7,174 million of assets for which significant quantitative unobservable inputs are not developed internally and not readily available to the Company (primarily those valued using broker quotes and certain third-party pricing services)

The following tables summarize changes to the Company’s financial instruments carried at fair value and classified within Level 3 of the fair value hierarchy for the years ended December 31, 2023 and December 31, 2022, respectively.

This summary excludes any impact of amortization of VOBA, DAC and DSI.

The gains and losses below may include changes in fair value due in part to observable inputs that are a component of the valuation methodology.

14 unchanged sentences

Foreign Governments 16 — — — — — — 16 —

Investment in unconsolidated affiliates 23 13 — 249 — — — 285 —

Short-term — — — 204 ( 19 ) ( 185 ) — — —

Derivative instruments — 57 — — — — — 57 —

Preferred securities 1 — — — — — 7 8 1

3 unchanged sentences

Credit linked note 15 — — — — ( 5 ) — 10 —

Investment in affiliate 21 — 2 — — — — 23 2

Secured borrowing receivable 10 — — — — ( 10 ) — — —

Total assets at Level 3 fair value $ 5,600 $ ( 17 ) $ ( 602 ) $ 4,321 $ ( 62 ) $ ( 760 ) $ ( 311 ) $ 8,169 $ ( 632 )

Future policy benefits $ — $ — $ — $ — $ — $ — $ — $ — $ —

Subtotal Level 3 assets at fair value $ 8,169 $ 17 $ 199 $ 2,991 $ ( 145 ) $ ( 1,041 ) $ ( 601 ) $ 9,589 $ 199

Market risk benefits asset $ 117 $ 88

Total Level 3 assets at fair value $ 8,286 $ 9,677

FIA/ IUL embedded derivatives, included in contractholder funds 3,115 257 — 1,049 — ( 163 ) — 4,258 —

Total liabilities at Level 3 fair value $ 3,883 $ ( 1,382 ) $ — $ 768 $ — $ ( 154 ) $ — $ 3,115 $ —

( a) The net transfers out of Level 3 during the year ended December 31, 2022 were to Level 2.

Subtotal Level 3 liabilities at fair value $ 3,115 $ 257 $ — $ 1,049 $ — $ ( 163 ) $ — $ 4,258 $ —

Market Risk benefits liability $ 282 $ 403

Total Level 3 liabilities at fair value $ 3,397 $ 4,661

Year ended December 31, 2022

12 unchanged sentences

Foreign Governments 18 — ( 2 ) — — — — 16 ( 1 )

Investment in unconsolidated affiliates 21 — 2 — — — — 23 2

Short-term 321 — ( 1 ) 20 — — ( 340 ) — ( 1 )

3 unchanged sentences

Available-for-sale embedded derivative 34 ( 11 ) — — — — — 23 —

Secured borrowing receivable — — — — — — 10 10 —

Credit linked note 23 ( 1 ) ( 1 ) — ( 2 ) ( 4 ) — 15 —

Investment in affiliate — — — 21 — — — 21 —

Total assets at Level 3 fair value $ 3,267 $ 15 $ ( 48 ) $ 4,449 $ ( 120 ) $ ( 1,449 ) $ ( 514 ) $ 5,600 $ 59

Future policy benefits (FSRC) $ 5 $ — $ — $ — $ ( 4 ) $ ( 1 ) $ — $ — $ —

Subtotal Level 3 assets at fair value $ 5,600 $ ( 17 ) $ ( 602 ) $ 4,321 $ ( 62 ) $ ( 760 ) $ ( 311 ) $ 8,169 $ ( 632 )

Market risk benefits asset $ 41 $ 117

Total Level 3 assets at fair value $ 5,641 $ 8,286

FIA embedded derivatives, included in contractholder funds 3,883 ( 1,382 ) — 768 — ( 154 ) — 3,115 —

Total liabilities at Level 3 fair value $ 3,409 $ 121 $ — $ 513 $ ( 4 ) $ ( 156 ) $ — $ 3,883 $ —

Subtotal Total liabilities at Level 3 fair value $ 3,883 $ ( 1,382 ) $ — $ 768 $ — $ ( 154 ) $ — $ 3,115 $ —

Market risk benefits liability $ 469 $ 282

Total Level 3 liabilities at fair value $ 4,352 $ 3,397

( a) The net transfers out of Level 3 during the year ended December 31, 2022, were to Level 2.

14 unchanged sentences

Fair values for policy loans are estimated from a discounted cash flow analysis, using interest rates currently being offered for loans with similar credit risk.

Loans with similar characteristics are aggregated for purposes of the calculations.

Loans with similar characteristics are aggregated for purposes of the calculations, policy loans are classified as Level 3 in the fair value hierarchy.

Company Owned Life Insurance

7 unchanged sentences

Investment Contracts

Investment contracts include deferred annuities (FIAs and fixed rate annuities), indexed IULs, funding agreements and pension risk transfer solutions ("PRT") and immediate annuity contracts without life contingencies.

Investment contracts include deferred annuities (FIAs and fixed rate annuities), indexed IULs, funding agreements, PRT solutions and immediate annuity contracts without life contingencies.

The FIA/IUL embedded derivatives, included in contractholder funds, are excluded as they are carried at fair value.

The fair value of the FIA, fixed rate annuity and IUL contracts is based on their cash surrender value (i.e.

the cost the Company would incur to extinguish the liability) as these contracts are generally issued without an annuitization date.

The fair value of the FIA, fixed rate annuity and IUL contracts is based on their cash surrender value (i.e., the cost the Company would incur to extinguish the liability) as these contracts are generally issued without an annuitization date.

The fair value of funding agreements and PRT and immediate annuity contracts without life contingencies is derived by calculating a new fair value interest rate using the updated yield curve and treasury spreads as of the respective reporting date.

1 unchanged sentence

Federal Home Loan Bank of Atlanta ("FHLB") common stock, Accounts receivable and Notes receivable are carried at cost, which approximates fair value.

FHLB common stock is classified as Level 2 within the fair value hierarchy.

The carrying amount of FHLB common stock represents the value it can be sold back to the FHLB and is classified as Level 2 within the hierarchy.

Accounts receivable and Notes receivable are classified as Level 3 within the fair value hierarchy.

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Total $ — $ 2,776 $ 34,464 $ — $ 37,240 $ 41,650

For investments for which NAV is used, we do not have any significant restrictions in our ability to liquidate our positions in these investments, other than obtaining general partner approval, nor do we believe it is probable a price less than NAV would be received in the event of a liquidation.

We review the fair value hierarchy classifications each reporting period.

3 unchanged sentences

Note E — Investments

Our fixed maturity securities investments have been designated as available-for-sale and are carried at fair value, net of allowance for expected credit losses, with unrealized gains and losses included in AOCI, net of associated adjustments for DAC, VOBA, DSI, UREV, SOP 03-1 reserves, and deferred income taxes.

Our preferred and equity securities investments are carried at fair value with unrealized gains and losses included in net earnings (loss).

The Company’s consolidated investments are summarized as follows (in millions):

Our investments in fixed maturity securities have been designated as AFS, and are carried at fair value, net of allowance for expected credit losses, with unrealized gains and losses included within AOCI, net of deferred income taxes.

Our preferred and equity securities investments are carried at fair value with unrealized gains and losses included in net earnings.

Our consolidated investments are summarized as follows :

December 31, 2023

Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value

Available-for-sale securities

Available-for-sale securities (In millions)

Asset-backed securities $ 14,631 $ ( 11 ) $ 191 $ ( 469 ) $ 14,342

9 unchanged sentences

Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value

Available-for-sale securities

Available-for-sale securities (In millions)

Asset-backed securities $ 12,209 $ ( 8 ) $ 36 $ ( 770 ) $ 11,467

8 unchanged sentences

Securities held on deposit with various state regulatory authorities had a fair value of $ 141 million and $ 17,870 million at December 31, 2023 and December 31, 2022, respectively.

As of December 31, 2022, we held $ 27 million of investments that were non-income producing for a period greater than twelve months.

As of December 31, 2021, we held no material investments that were non-income producing for a period greater than twelve months.

The decrease in securities held on deposit with various state regulatory authorities during the year ended December 31, 2023, is primarily attributable to revisions to regulatory requirements in the state of Iowa.

As of December 31, 2023 and December 31, 2022, we held $ 47 million and $ 27 million of investments that were non-income producing for a period greater than twelve months, respectively.

As of December 31, 2023 and December 31, 2022, the Company's accrued interest receivable balance was $ 481 million and $ 365 million, respectively.

42 unchanged sentences

If we intend to sell a fixed maturity security or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis and the fair value of the security is below amortized cost, we will write down the security to current fair value, with a corresponding charge, net of any amount previously recognized as an allowance for expected credit loss, to Recognized gains and losses, net in the accompanying Consolidated Statements of Earnings.

If we do not intend to sell a fixed maturity security or it is more likely than not that we will not be required to sell a fixed maturity security before recovery of its amortized cost basis but believe amounts related to a security are uncollectible (generally based on proximity to expected credit loss), an impairment is deemed to have occurred and the amortized cost is written down to the estimated recovery value with a corresponding charge, net of any amount previously recognized as an allowance for expected credit loss, to Recognized gains and losses, net in the accompanying Consolidated Statements of Earnings.

If we do not intend to sell a fixed maturity security or it is more likely than not that we will not be required to sell a fixed maturity security before recovery of its amortized cost basis but believe amounts related to a security are uncollectible , an impairment is deemed to have occurred and the amortized cost is written down to the estimated recovery value with a corresponding charge, net of any amount previously recognized as an allowance for expected credit loss, to Recognized gains and losses, net in the accompanying Consolidated Statements of Earnings.

The remainder of unrealized loss is held in AOCI.

As of December 31, 2023 and 2022, our allowance for expected credit losses for AFS securities was $ 42 million and $ 39 million, respectively.

The fair value and gross unrealized losses of available-for-sale securities, excluding securities in an unrealized loss position with an allowance for expected credit loss, aggregated by investment category and duration of fair value below amortized cost were as follows (dollars in millions):

December 31, 2023

3 unchanged sentences

Losses Fair Value Gross Unrealized

Available-for-sale securities

Available-for-sale securities (Dollars in millions)

Asset-backed securities $ 1,707 $ ( 56 ) $ 5,835 $ ( 404 ) $ 7,542 $ ( 460 )

28 unchanged sentences

Total number of available-for-sale securities in an unrealized loss position 4,410

We determined the increase in unrealized losses as of December 31, 2022 was caused by higher treasury rates as well as wider spreads.

This is in part due to the Federal Reserve's action to increase rates in efforts to combat inflation.

We determined the unrealized losses were caused by higher treasury rates compared to those at the time of the F&G acquisition or the purchase of the security if later.

For securities in an unrealized loss position as of December 31, 2023, our allowance for expected credit loss was $ 42 million.

3 unchanged sentences

Commercial Mortgage Loans

Commercial mortgage loans ("CMLs") represented approximately 6 % of our total investments at December 31, 2022 and December 31, 2021.

CMLs represented approximately 6 % of our total investments at December 31, 2023 and December 31, 2022.

The mortgage loans in our investment portfolio, are generally comprised of high quality commercial first lien and mezzanine real estate loans.

1 unchanged sentence

We continuously evaluate CMLs based on relevant current information to ensure properties are performing at a consistent and acceptable level to secure the related debt.

The distribution of CMLs, gross of valuation allowances, by property type and geographic region is reflected in the following tables (dollars in millions):

The distribution of CMLs, gross of valuation allowances, by property type and geographic region is reflected in the following tables:

December 31, 2023 December 31, 2022

1 unchanged sentence

Property Type:

(Dollars in millions)

Hotel $ 18 1 % $ 18 1 %

21 unchanged sentences

Total commercial mortgage loans, net of valuation allowance $ 2,538 $ 2,406

LTV and debt service coverage ("DSC") ratios are measures commonly used to assess the risk and quality of mortgage loans.

CMLs segregated by aging of loans and charge offs (by year of origination) were as follows for the year ended December 31, 2023:

December 31, 2023

Amortized Cost by Origination Year

2023 2022 2021 2020 2019 Prior Total

(In millions)

Current (less than 30 days past due) $ 213 $ 288 $ 1,256 $ 512 $ — $ 259 $ 2,528

30-89 days past due — — — — — — —

90 days or more past due — — — — — — —

Total commercial mortgage loans (a) $ 213 $ 288 $ 1256 $ 512 $ — $ 259 $ 2,528

Charge offs $ — $ — $ — $ — $ — $ 3 $ 3

(a) Excludes loans under development with an amortized cost and estimated fair value of $ 22 million at December 31, 2023.

CMLs segregated by aging of loans (by year of origination) were as follows for the year ended December 31, 2022:

December 31, 2022

Amortized Cost by Origination Year

2022 2021 2020 2019 2018 Prior Total

(In millions)

Current (less than 30 days past due) $ 341 $ 1,300 $ 488 $ — $ — $ 269 $ 2,398

30-89 days past due — — — — — — —

90 days or more past due — — — — — 9 9

Total commercial mortgage loans(a) $ 341 $ 1,300 $ 488 $ — $ — $ 278 $ 2,407

(a) Excludes loans under development with an amortized cost and estimated fair value of $ 9 million at December 31, 2022.

LTV and DSC ratios are measures commonly used to assess the risk and quality of mortgage loans.

The LTV ratio is expressed as a percentage of the amount of the loan relative to the value of the underlying property.

3 unchanged sentences

We normalize our DSC ratios to a 25 -year amortization period for purposes of our general loan allowance evaluation.

The following tables presents the recorded investment in CMLs by LTV and DSC ratio categories and estimated fair value by the indicated loan-to-value ratios, gross of valuation allowances (dollars in millions) :

The following tables presents the recorded investment in CMLs by LTV and DSC ratio categories and estimated fair value by the indicated loan-to-value ratios, gross of valuation allowances :

Debt-Service Coverage Ratios Total Amount % of Total Estimated Fair Value % of Total

>1.25 1.00 - 1.25 <1.00

December 31, 2022

December 31, 2023 (Dollars in millions)

Less than 50.00% $ 519 $ 4 $ 10 $ 533 21 % $ 510 23 %

7 unchanged sentences

60.00% to 74.99% 1,154 3 — 1,157 48 % 955 45 %

75.00% to 84.99% — — 18 18 1 % 14 1 %

Commercial mortgage loans $ 2,371 $ 7 $ 29 $ 2,407 100 % $ 2,074 100 %

(a) Excludes loans under development with an amortized cost and estimated fair value of $ 9 million.

(a) Excludes loans under development with an amortized cost and estimated fair value of $ 22 million and $ 9 million at December 31, 2023 and 2022, respectively.

December 31, 2023

Amortized Cost by Origination Year

2023 2022 2021 2020 2019 Prior Total

LTV (In millions)

Less than 50.00% $ 85 $ 17 $ 77 $ 232 $ — $ 122 $ 533

50.00% to 59.99% 53 149 267 158 — 137 764

60.00% to 74.99% 69 113 912 122 — — 1,216

75.00% to 84.99% 6 9 — — — — 15

Total commercial mortgage loans (a) $ 213 $ 288 $ 1,256 $ 512 $ — $ 259 2,528

Greater than 1.25x $ 154 $ 276 $ 1,256 $ 512 $ — $ 245 $ 2,443

1.00x - 1.25x 59 3 — — — 4 66

Less than 1.00x — 9 — — — 10 19

Total commercial mortgage loans (a) $ 213 $ 288 $ 1,256 $ 512 $ — $ 259 $ 2,528

December 31, 2022

Amortized Cost by Origination Year

2022 2021 2020 2019 2018 Prior Total

LTV (In millions)

Less than 50.00% $ 70 $ 120 $ 207 $ — $ — $ 129 $ 526

50.00% to 59.99% 149 268 158 — — 131 706

60.00% to 74.99% 113 912 123 — — 9 1,157

75.00% to 84.99% 9 — — — — 9 18

Total commercial mortgage loans (a) $ 341 $ 1,300 $ 488 $ — $ — $ 278 $ 2,407

Greater than 1.25x $ 329 $ 1,300 $ 488 $ — $ — $ 254 $ 2,371

1.00x - 1.25x 3 — — — — 4 7

Less than 1.00x 9 — — — — 20 29

Total commercial mortgage loans (a) $ 341 $ 1,300 $ 488 $ — $ — $ 278 $ 2,407

(a) Excludes loans under development with an amortized cost and estimated fair value of $ 22 million for December 31, 2023, and an amortized cost and estimated fair value of $ 9 million for December 31, 2022.

We recognize mortgage loans as delinquent when payments on the loan are greater than 30 days past due.

At December 31, 2022, we had one CML that was delinquent in principal or interest payments as shown in the risk rating exposure table below.

At December 31, 2021, we had no CMLs that were delinquent in principal or interest payments.

At December 31, 2023 and December 31, 2022, we had no CMLs that were delinquent in principal or interest payments as shown in the risk rating exposure table below.

Residential Mortgage Loans

Residential mortgage loans ("RMLs") represented approximately 5 % and 4 % of our total investments at December 31, 2022 and December 31, 2021, respectively.

RMLs represented approximately 7 % and 5 % of our total investments at December 31, 2023 and December 31, 2022, respectively.

Our residential mortgage loans are closed end, amortizing loans and 100 % of the properties are located in the United States.

We diversify our RML portfolio by state to attempt to reduce concentration risk.

The distribution of RMLs by state with highest-to-lowest concentration are reflected in the following tables, gross of valuation allowances (dollars in millions):

The distribution of RMLs by state with highest-to-lowest concentration are reflected in the following tables, gross of valuation allowances:

December 31, 2023

Amortized Cost % of Total

Amortized Cost (In millions) % of Total

Florida $ 163 6 %

Texas 215 10 %

New Jersey 172 8 %

Pennsylvania 153 7 %

California 139 6 %

New York 129 5 %

Georgia 125 6 %

Texas 129 5 %

All Other States (1) 2,431 85 %

Total mortgage loans $ 2,180 100 %

Total residential mortgage loans, gross of valuation allowance $ 2,852 100 %

Allowance for expected credit loss ( 54 )

Total residential mortgage loans, net of valuation allowance $ 2,798

(1) The individual concentration of each state is equal to or less than to 5%.

December 31, 2022

Amortized Cost % of Total

Amortized Cost (In millions) % of Total

Florida $ 324 15 %

1 unchanged sentence

New Jersey 172 8 %

All Other States (1) 1,049 65 %

Total residential mortgage loans $ 1,606 100 %

Pennsylvania 153 7 %

California 139 6 %

New York 138 6 %

Georgia 125 6 %

All other states (a) 914 42 %

Total residential mortgage loans, gross of valuation allowance $ 2,180 100 %

Allowance for expected credit loss ( 32 )

Total residential mortgage loans, net of valuation allowance $ 2,148

(1) The individual concentration of each state is less than 5%.

1 unchanged sentence

We define non-performing RMLs as those that are 90 or more days past due or in nonaccrual status, which is assessed monthly.

The credit quality of RMLs was as follows (dollars in millions):

The credit quality of RMLs was as follows:

December 31, 2023 December 31, 2022

1 unchanged sentence

Amortized Cost % of Total Amortized Cost % of Total

(Dollars in millions)

Performing $ 2,795 98 % $ 2,118 97 %

3 unchanged sentences

Total residential mortgage loans, net of valuation allowance $ 2,798 100 % $ 2,148 100 %

Loans segregated by risk rating exposure were as follows, gross of valuation allowances (in millions):

There were no charge offs recorded on RMLs during the year ended December 31, 2023 .

RMLs segregated by aging of the loans (by year of origination) as of December 31, 2023 and 2022 were as follows, gross of valuation allowances (in millions):

December 31, 2023

1 unchanged sentence

2023 2022 2021 2020 2019 Prior Total

Residential mortgages

Residential mortgages (In millions)

Current (less than 30 days past due) $ 373 $ 985 $ 854 $ 192 $ 183 $ 192 $ 2,779

2 unchanged sentences

Total residential mortgages $ 373 $ 995 $ 877 $ 208 $ 204 $ 195 $ 2,852

Commercial mortgages

Current (less than 30 days past due) $ 350 $ 1,300 $ 488 $ — $ — $ 269 $ 2,407

30-89 days past due — — — — — — —

90 days or more past due — — — — — 9 9

Total commercial mortgages $ 350 $ 1,300 $ 488 $ — $ — $ 278 $ 2,416

December 31, 2022

1 unchanged sentence

2022 2021 2020 2019 2018 Prior Total

Residential mortgages

Residential mortgages (In millions)

Current (less than 30 days past due) $ 766 $ 884 $ 214 $ 185 $ 23 $ 33 $ 2,105

2 unchanged sentences

Total residential mortgages $ 771 $ 900 $ 229 $ 223 $ 24 $ 33 $ 2,180

Commercial mortgages

Current (less than 30 days past due) $ 1301 $ 543 $ — $ 6 $ — $ 324 $ 2,174

30-89 days past due — — — — — — —

90 days or more past due — — — — — — —

Total commercial mortgages $ 1,301 $ 543 $ — $ 6 $ — $ 324 $ 2,174

December 31, 2022

Amortized Cost by Origination Year

2022 2021 2020 2019 2018 Prior Total

Commercial mortgages

Less than 50.00% $ 70 $ 120 $ 207 $ — $ — $ 129 $ 526

50.00% to 59.99% 149 268 158 — — 131 706

60.00% to 74.99% 113 912 123 — — 9 1,157

75.00% to 84.99% 9 — — — — 9 18

Total commercial mortgages (a) $ 341 $ 1300 $ 488 $ — $ — $ 278 $ 2,407

Commercial mortgages

Greater than 1.25x $ 329 $ 1,300 $ 488 $ — $ — $ 254 $ 2,371

1.00x - 1.25x 3 — — — — 4 7

Less than 1.00x 9 — — — — 20 29

Total commercial mortgages (a) $ 341 $ 1300 $ 488 $ — $ — $ 278 $ 2,407

(a) Excludes loans under development with an amortized cost and estimated fair value of $ 9 million.

December 31, 2021

Amortized Cost by Origination Year

2021 2020 2019 2018 2017 Prior Total

Commercial mortgages

Less than 50.00% $ 120 $ 229 $ — $ 6 $ — $ 313 $ 668

50.00% to 59.99% 267 192 — — — 11 470

60.00% to 74.99% 914 122 — — — — 1,036

Total commercial mortgages $ 1,301 $ 543 $ — $ 6 $ — $ 324 $ 2,174

Commercial mortgages

Greater than 1.25x $ 1,301 $ 543 $ — $ 4 $ — $ 284 $ 2,132

1.00x - 1.25x — — — 2 — 31 33

Less than 1.00x — — — — — 9 9

Total commercial mortgages $ 1,301 $ 543 $ — $ 6 $ — $ 324 $ 2,174

Non-accrual loans by amortized cost were as follows (in millions):

The amortized cost of non-accrual loans as of December 31, 2023 and 2022 were as follows:

Amortized cost of loans on non-accrual December 31, 2023 December 31, 2022

(In millions)

Residential mortgage $ 57 $ 62

17 unchanged sentences

Ending Balance $ 54 $ 12 $ 66 $ 32 $ 10 $ 42

Seven months ended December 31, 2020

Year ended December 31, 2021

Residential Mortgage Commercial Mortgage Total

1 unchanged sentence

Provision for loan losses ( 12 ) 4 ( 8 )

For initial credit losses on purchased loans accounted for as PCD financial assets 7 — 7

Ending Balance $ 25 $ 6 $ 31

2 unchanged sentences

Interest and Investment Income

The major sources of Interest and investment income reported on the accompanying Consolidated Statements of Earnings were as follows (in millions):

The major sources of Interest and investment income reported on the accompanying Consolidated Statements of Earnings were as follows:

December 31, 2023 December 31, 2022 December 31, 2021

(In millions)

Fixed maturity securities, available-for-sale $ 1,911 $ 1,489 $ 1,267

10 unchanged sentences

The Company’s Interest and investment income is shown net of amounts attributable to certain funds withheld reinsurance agreements, which is passed along to the reinsurer in accordance with the terms of these agreements.

Interest and Investment Income attributable to these agreements, and thus excluded from the totals in the table above, was $ 109 million, $ 53 million and $ 21 million for the years ended December 31, 2022 and 2021 and for the period from June 1 to December 31, 2020.

Interest and Investment Income attributable to these agreements, and thus excluded from the totals in the table above, was $ 339 million, $ 109 million, and $ 53 million for the years ended December 31, 2023, 2022, and 2021, respectively.

Recognized Gains and Losses, net

Details underlying Recognized gains and losses, net reported on the accompanying Consolidated Statements of Earnings were as follows (in millions):

Details underlying Recognized gains and losses, net reported on the accompanying Consolidated Statements of Earnings were as follows:

December 31, 2023 December 31, 2022 December 31, 2021

(In millions)

Net realized (losses) gains on fixed maturity available-for-sale securities $ ( 155 ) $ ( 253 ) $ 111

10 unchanged sentences

Recognized gains and losses, net $ ( 164 ) $ ( 1,493 ) $ 334

(1) Change in fair value of reinsurance related embedded derivatives is due to activity related to the reinsurance treaties with Kubera (novated from Kubera to Somerset effective October 31, 2021) and Aspida Re.

(1) Includes net valuation (losses) gains of $ 47 million, $( 387 ) million and $( 436 ) million for the years ended December 31, 2023, 2022, and 2021, respectively.

(2) Includes net valuation losses of $ 80 million, $ 198 million, and $ 14 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Recognized gains and losses is shown net of amounts attributable to certain funds withheld reinsurance agreements which is passed along to the reinsurer in accordance with the terms of these agreements.

Recognized gains and losses attributable to these agreements, and thus excluded from the totals in the table above, was $( 123 ) million, $ 381 million and $ 15 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The proceeds from the sale of fixed-maturity securities and the gross gains and losses associated with those transactions were as follows (in millions):

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In addition, we invest in structured investments that may be VIEs, but for which we are not the primary beneficiary.

These structured investments typically invest in fixed income investments and are managed by third parties and include asset-backed securities, commercial mortgage-backed securities and residential mortgage-backed securities included in fixed maturity securities available for sale on our Consolidated Balance Sheets.

Our maximum exposure to loss with respect to these VIEs is limited to the investment carrying amounts reported in our Consolidated Balance Sheets for limited partnerships and the amortized costs of our fixed maturity securities, in addition to any required unfunded commitments (also refer to Note H Commitments and Contingencies ).

These structured investments typically invest in fixed income investments and are managed

by third parties and include asset-backed securities, commercial mortgage-backed securities and residential mortgage-backed securities included in fixed maturity securities available for sale on our Consolidated Balance Sheets.

Our maximum loss exposure with respect to these VIEs is limited to the investment carrying amounts reported in our Consolidated Balance Sheets for limited partnerships and the amortized costs of certain of our fixed maturity securities, in addition to any required unfunded commitments (also refer to Note H Commitments and Contingencies ).

The following table summarizes the carrying value and the maximum loss exposure of our unconsolidated VIEs:

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Carrying Value Maximum Loss Exposure Carrying Value Maximum Loss Exposure

(In millions)

Investments in unconsolidated affiliates $ 3,071 $ 4,806 $ 2,427 $ 4,030

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Concentrations

Our underlying investment concentrations that exceed 10% of shareholders equity are as follows (in millions):

December 31, 2022

Our underlying investment concentrations that exceed 10% of shareholders equity are as follows:

December 31, 2023 December 31, 2022

(In millions)

Blackstone Wave Asset Holdco (1)

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(1) Represents a special purpose vehicle that holds investments in numerous limited partnership investments whose underlying investments are further diversified by holding interest in multiple individual investments and industries.

Investment in Cannae Holdings, Inc.

Included in equity securities as of December 31, 2021 were 5,775,598 shares of Cannae common stock (NYSE:

The fair value of this investment based on quoted market prices was $ 203 million as of December 31, 2021.

During the year ended December 31, 2022, we sold all 5,775,598 shares of CNNE common stock back to Cannae for approximately $ 109 million in the aggregate.

As of December 31, 2022, we held no shares of CNNE common stock.

Note F — Derivative Financial Instruments

The carrying amounts of derivative instruments, including derivative instruments embedded in FIA and IUL contracts, and reinsurance is as follows (in millions):

The carrying amounts of derivative instruments, including derivative instruments embedded in FIA and IUL contracts, and reinsurance is as follows:

December 31, 2023 December 31, 2022

(In millions)

Derivative investments:

Call options $ 739 $ 244

Interest rate swaps 57 —

Foreign currency forward 1 —

Other long-term investments:

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FIA/ IUL embedded derivatives $ 4,258 $ 3,115

Accounts payable and accrued liabilities:

Reinsurance related embedded derivatives — 73

$ 4,258 $ 3,115

The change in fair value of derivative instruments included within Recognized gains and losses, net, in the accompanying Consolidated Statements of Earnings is as follows (in millions):

Year Ended Seven Months Ended

December 31, 2022 December 31, 2021 December 31, 2020

The change in fair value of derivative instruments included within Recognized gains and losses, net, in the accompanying Consolidated Statements of Earnings is as follows:

Year ended December 31,

2023 2022 2021

Net investment gains (losses):

(In millions)

Call options $ 92 $ ( 862 ) $ 597

Interest rate swaps 48 — —

Futures contracts 9 ( 7 ) 8

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Reinsurance related embedded derivatives ( 128 ) 352 34

Total net investment gains $ ( 515 ) $ 654 $ 192

Total net investment gains (losses) $ 24 $ ( 515 ) $ 654

Benefits and other changes in policy reserves:

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Additional Disclosures

FIA/ IUL Embedded Derivative and Call Options and Futures

FIA/IUL Embedded Derivative, Call Options and Futures

We have FIA and IUL contracts that permit the holder to elect an interest rate return or an equity index linked component, where interest credited to the contracts is linked to the performance of various equity indices, primarily the S&P 500 Index.

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On the respective anniversary dates of the indexed policies, the index used to compute the interest credit is reset and we purchase new call options to fund the next index credit.

We manage the cost of these purchases through the terms of our FIA/IUL contracts, which permit us to change caps, spreads or participation rates, subject to guaranteed minimums, on each contract’s anniversary date.

The change in

the fair value of the call options and futures contracts is generally designed to offset the portion of the change in the fair value of the FIA/IUL embedded derivatives related to index performance through the current credit period.

We manage the cost of these purchases through the terms of our FIA/IUL contracts, which permit us to

change caps, spreads or participation rates, subject to guaranteed minimums, on each contract’s anniversary date.

The change in the fair value of the call options and futures contracts is generally designed to offset the portion of the change in the fair value of the FIA/IUL embedded derivatives related to index performance through the current credit period.

The call options and futures contracts are marked to fair value with the change in fair value included as a component of Recognized gains and losses, net, in the accompanying Consolidated Statements of Earnings.

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We intend to continue to adjust the hedging strategy as market conditions and our risk tolerance changes.

We are exposed to credit loss in the event of non-performance by our counterparties on the call options and reflect assumptions regarding this non-performance risk in the fair value of the call options.

Interest Rate Swaps

We utilize interest rate swaps to reduce market risks from interest rate changes on our earnings associated with our floating rate investments.

With an interest rate swap, we agree with another party to exchange the difference between fixed-rate and floating-rate interest amounts tied to an agreed upon notional principal at specified intervals.

The interest rate swaps are marked to fair value with the change in fair value, including accrued interest and related periodic cash flows received or paid, included as a component of Recognized gains and losses, net, in the accompanying Consolidated Statements of Earnings.

Reinsurance Related Embedded Derivatives

F&G cedes certain business on a coinsurance funds withheld basis.

Investment results for the assets that support the coinsurance that are segregated within the funds withheld account are passed directly to the reinsurer pursuant to the contractual terms of the reinsurance agreement, which creates embedded derivatives considered to be total return swaps.

These total return swaps are not clearly and closely related to the underlying reinsurance contract and thus require bifurcation.

The fair value of the total return swaps is based on the change in fair value of the underlying assets held in the funds withheld account.

These embedded derivatives are reported in Prepaid expenses and other assets if in a net gain position, or Accounts payable and accrued liabilities, if in a net loss position on the Consolidated Balance Sheets and the related gains or losses are reported in Recognized gains and losses, net, on the Consolidated Statements of Earnings.

We are exposed to credit loss in the event of non-performance by our counterparties on the call options and interest rate swaps and reflect assumptions regarding this non-performance risk in the fair value of the these derivatives.

The non-performance risk is the net counterparty exposure based on the fair value of the open contracts less collateral held.

We maintain a policy of requiring all derivative contracts to be governed by an International Swaps and Derivatives Association (“ISDA”) Master Agreement.

Information regarding our exposure to credit loss on the call options we hold is presented in the following table (in millions):

Information regarding our exposure to credit loss on the call options and interest rate swaps we hold is presented in the following table:

December 31, 2023

Counterparty Credit Rating

(Fitch/Moody's/S&P) (1) Notional

(Fitch/Moody's/S&P) (a) Notional

Amount Fair Value Collateral Net Credit Risk

(In millions)

Merrill Lynch AA/*/A+ $ 4,408 $ 96 $ 59 $ 37

Morgan Stanley */Aa3/A+ 1,699 14 19 —

Morgan Stanley AA-/Aa3/A+ 3,466 102 116 —

Barclay's Bank A+/A1/A+ 6,236 102 100 2

Canadian Imperial Bank of Commerce AA/Aa2/A+ 5,169 68 64 4

Wells Fargo A+/A1/BBB+ 1,361 17 17 —

Goldman Sachs A/A2/BBB+ 1,133 9 10 —

Credit Suisse BBB+/A3/A- 1,039 5 5 —

Canadian Imperial Bank of Commerce AA-/A2/A- 5,983 147 148 —

Wells Fargo AA-/Aa2/A+ 1,443 58 60 —

Goldman Sachs A+/A1/A+ 1,919 45 45 —

Credit Suisse A+/A3/A+ 92 4 4 —

Truist A+/A2/A 2,759 124 124 —

Citibank A+/Aa3/A+ 1,073 27 28 —

JP Morgan AA/Aa2/A+ 2,589 91 91 —

Total $ 29,968 $ 796 $ 775 $ 39

December 31, 2022

Counterparty Credit Rating (Fitch/Moody's/S&P)(1) Notional Amount Fair Value Collateral Net Credit Risk

Counterparty Credit Rating (Fitch/Moody's/S&P)(a) Notional Amount Fair Value Collateral Net Credit Risk

(In millions)

Merrill Lynch AA/*/A+ $ 3,563 $ 23 $ — $ 23

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Goldman Sachs A/A2/BBB+ 1,133 9 10 —

Credit Suisse A/A1/A+ 1,485 74 75 —

Credit Suisse BBB+/A3/A- 1,039 5 5 —

Truist A+/A2/A 2,489 35 36 —

Citibank A+/Aa3/A+ 795 8 9 —

Total $ 23,297 $ 244 $ 219 $ 33

(1) An * represents credit ratings that were not available.

(a) An * represents credit ratings that were not available.

Collateral Agreements

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Under some ISDA agreements, we have agreed to maintain certain financial strength ratings.

A downgrade below these levels provides the counterparty under the agreement the right to terminate the open option contracts between the parties, at which time any amounts payable by us or the counterparty would be dependent on the market value of the underlying option contracts.

A downgrade below these levels provides the counterparty under the agreement the right to terminate the open derivative contracts between the parties, at which time any amounts payable by us or the counterparty would be dependent on the market value of the underlying contracts.

Our current rating does not allow any counterparty the right to terminate ISDA agreements.

In certain transactions, both we and the counterparty have entered into a collateral support agreement requiring either party to post collateral when the net exposures exceed pre-determined thresholds.

In certain transactions, both us and the counterparty have entered into a collateral support agreement requiring either party to post collateral when the net exposures exceed pre-determined thresholds.

For all counterparties, except Merrill Lynch, this threshold is set to zero .

As of December 31, 2023 and December 31, 2022, counterparties posted $ 775 million and $ 219 million, respectively, of collateral, of which $ 588 million and $ 178 million, respectively, is included in cash and cash equivalents with an associated payable for this collateral included in accounts payable and accrued liabilities on the Consolidated Balance Sheets.

Accordingly, the maximum amount of loss due to credit risk that we would incur if parties to the call options failed completely to perform according to the terms of the contracts was $ 33 million at December 31, 2022 and $ 42 million at December 31, 2021.

Accordingly, the maximum amount of loss due to credit risk that we would incur if parties to the derivatives failed completely to perform according to the terms of the contracts was $ 39 million at December 31, 2023, and $ 33 million at December 31, 2022.

We are required to pay counterparties the effective federal funds rate each day for cash collateral posted to F&G for daily mark to market margin changes.

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The amount of cash collateral held by the counterparties for such contracts was $ 4 million and $ 3 million at December 31, 2023 and December 31, 2022, respectively.

Reinsurance Related Embedded Derivatives

F&G entered into a reinsurance agreement with Kubera, effective December 31, 2018, to cede certain multi-year guaranteed annuity (“MYGA”) and deferred annuity business on a coinsurance funds withheld basis, net of applicable existing reinsurance.

Effective October 31, 2021, this agreement was novated from Kubera to Somerset, a certified third party reinsurer.

Additionally, F&G entered into a reinsurance agreement with Aspida Re effective January 1, 2021, and amended in August 2021 and September 2022, to cede a quota share of certain deferred annuity business on a funds withheld basis.

Fair value movements in the funds withheld balances associated with these arrangements creates an obligation for F&G to pay Somerset and Aspida Re at a later date, which results in embedded derivatives.

These embedded derivatives are considered total return swaps with contractual returns that are attributable to the assets and liabilities associated with the reinsurance arrangements.

The fair value of the total return swap is based on the change in fair value of the underlying assets held in the funds withheld portfolio.

Investment results for the assets that support the coinsurance with funds withheld reinsurance arrangements, including gains and losses from sales, were passed directly to the reinsurers pursuant to contractual terms of the reinsurance arrangements.

The reinsurance related embedded derivatives are reported in prepaid expenses and other assets if in a net gain position, or accounts payable and accrued liabilities, if in a net loss position, on the Consolidated Balance Sheets and the related gains or losses are reported in Recognized gains and losses, net on the Consolidated Statements of Earnings.

Note G — Notes Payable

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3.20 % Notes, net of discount

Revolving Credit Facility ( 2 ) ( 3 )

F&G Credit Agreement 362 547

5.50 % F&G Notes

5.50 % F&G Notes, net of discount

7.40 % F&G Notes, net of discount

7.95 % F&G Notes, net of discount

$ 3,887 $ 3,238

On December 6th, 2023, F&G issued $ 345 million of its 7.95 % Senior Notes due 2053.

The 7.95 % F&G Notes were issued at par, net of deferred issuance costs of approximately $ 9 million.

The 7.95 % F&G Notes are senior unsecured, unsubordinated obligations of F&G and are guaranteed by each of F&G’s subsidiaries that are guarantors of F&G’s obligations under its existing credit agreement.

The 7.95 % F&G Notes mature on December 15, 2053, and become callable on or after December 15, 2028.

Interest is payable quarterly at a fixed rate of 7.95 %, and, if the 7.95 % F&G Notes are downgraded, the interest rate payable is subject to adjustment from time to time per the terms of the indenture.

F&G used a portion of the net proceeds from the offering to repay borrowings under its revolving credit facility as discussed below and for general corporate purposes, including the support of organic growth opportunities.

On January 13, 2023, F&G issued $ 500 million of its 7.40 % F&G Notes due 2028.

The 7.40 % F&G Notes were issued at par, net of deferred issuance costs of approximately $ 6 million.

The 7.40 % F&G Notes are senior, unsecured unsubordinated obligation of F&G and are fully and unconditionally guaranteed on an unsecured, unsubordinated basis by each of F&G’s subsidiaries that are guarantors of F&G’s obligations under its existing credit agreement.

The 7.40 % F&G Notes mature on January 13, 2028, and become callable on or after December 13, 2027.

Interest is payable semi-annually at a fixed rate of 7.40 %, and if, the 7.40 % F&G Notes are downgraded, the interest rate payable is subject to adjustment from time to time per the terms of the indenture.

F&G used the net proceeds from the offering for general corporate purposes, including to support the growth of assets under management and for F&G's future liquidity requirements.

On November 22, 2022, F&G entered into the F&G Credit Agreement pursuant to which the Lenders have made available the F&G Credit Facility in an aggregate principal amount of $ 550 million to be used for working capital and general corporate purposes.

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As of December 31, 2022, the revolving credit facility was fully drawn with $ 550 million outstanding, offset by approximately $ 3 million of unamortized debt issuance costs.

A net partial paydown of $ 35 million was made on January 6, 2023 and, on February 21, 2023, F&G entered into the Amended F&G Credit Agreement with the Lenders and the Administrative Agent, swing line lender and issuing bank.

On February 21, 2023, F&G entered into the Amended F&G Credit Agreement with the Lenders and the Administrative Agent, swing line lender and issuing bank.

The Amended F&G Credit Agreement increased the aggregate principal amount of commitments under the F&G Credit Facility by $ 115 million to $ 665 million.

On February 16, 2024, we entered into a Second Amended and Restated F&G Credit Agreement.

Among other changes, the Second Amended and Restated F&G Credit Agreement amends the Amended F&G Credit Agreement to extend the maturity date and increase the aggregate principal amount of commitments under the revolving credit facility to $ 750 million.

As of December 31, 2023, and 2022, $ 365 million and $ 550 million, respectively, of gross principal balance, was outstanding under the F&G Credit Agreement.

Net partial revolver paydowns of $ 185 million were made during the year ended December 31, 2023.

As of December 31, 2023, we had $ 300 million of remaining borrowing availability.

On September 17, 2021, we completed our underwritten public offering of $ 450 million aggregate principal amount of our 3.20 % Notes due 2051, pursuant to our registration statement on Form S-3 ASR (File No.

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As of December 31, 2023, there was no principal outstanding, $ 2 million of unamortized debt issuance costs, and $ 800 million of available borrowing capacity under the Revolving Credit Facility.

On February 16, 2024, we entered into a Sixth Amended and Restated Credit Agreement.

Among other changes, the Sixth Amended and Restated Credit Agreement amends the Fifth Restated Credit Agreement to extend the maturity date from October 29, 2025 to February 16, 2029.

On September 15, 2020, we completed our underwritten public offering of $ 600 million aggregate principal amount of our 2.45 % Notes due March 15, 2031 (the " 2.45 % Notes") pursuant to an effective registration statement filed with the Securities and Exchange Commission ("SEC").

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On September 1, 2022, we repaid the remaining $ 400 million in outstanding principal amount of our 5.50 % Senior Notes due September 2022.

Gross principal maturities of notes payable at December 31, 2022 are as follows (in millions):

Gross principal maturities of notes payable at December 31, 2023, are as follows:

(In millions)

Thereafter 2,045

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For legal proceedings in which it has been determined that a loss is both probable and reasonably estimable, a liability based on known facts and that represents our best estimate has been recorded.

Our accrual for legal and regulatory matters was $ 12 million a s of December 31, 2022 and 2021 .

Our accrual for legal and regulatory matters was $ 10 million and $ 12 million a s of December 31, 2023 and 2022, respectively .

None of the amounts we have currently recorded are considered to be material to our financial condition individually or in the aggregate.

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In August 2020, a lawsuit styled, In the Matter of FGL Holdings, was filed in the Grand Court of the Cayman Islands related to FNF's acquisition of F&G where dissenting shareholders, Kingfishers LP, Kingstown 1740 Fund LP, Kingstown Partners II LP, Kingstown Partners Master Ltd., and Ktown LP, asserted statutory appraisal rights relative to their ownership of 12,000,000 shares of F&G stock.

They sought a judicial determination of the fair value of their shares of F&G stock as of the date of valuation under the law of the Cayman Islands, together with interest.

On September 5, 2022 the Grand Court of the

Cayman Islands decided in favor of F&G.

Kingstown Capital Management LP failed to appeal, and its appeal period expired on October 20, 2022.

They sought a judicial determination of the fair value of their shares of F&G stock as of the date of valuation under the law of the Cayman Islands, together with interest and legal costs.

On October 5, 2022, the Grand Court of the Cayman Islands decided in favor of F&G.

The dissenting shareholders failed to appeal the fair value order, and its appeal period expired on October 19, 2022.

On April 19, 2023, the Grand Court of the Cayman Islands determined that the dissenting shareholders should pay F&G’s Cayman Islands legal expenses and discovery costs relating to the lawsuit by way of an interim payment of $ 4 million, with the balance to be determined after assessment.

We are attempting to collect reimbursement of our expenses in this lawsuit.

F&G is a defendant in two putative class action lawsuits related to the alleged compromise of certain of F&G’s customers’ personal information resulting from an alleged vulnerability in the MOVEit file transfer software.

F&G’s vendor, Pension Benefit Information, LLC (“PBI”), used the MOVEit software in the course of providing audit and address research services to F&G and many other corporate customers.

4:23-cv-00326, was filed against F&G in the Southern District of Iowa on August 31, 2023.

Miller alleges that he is an F&G customer whose information was impacted in the MOVEit incident and brings common law tort and implied contract claims.

F&G has yet to be served in Miller.

Plaintiff seeks injunctive relief and damages.

Progress Software Corp., No.

1:23-cv-12067, was filed against F&G and five other defendants in the District of Massachusetts on September 7, 2023.

F&G was served on September 15, 2023.

Cooper also alleges that he is an F&G customer and brings similar common law tort claims and alleges claims as a purported third-party beneficiary of an alleged contract.

Plaintiff seeks declaratory and injunctive relief and damages.

At this time, F&G does not believe the incident will have a material impact on its business, operations, or financial results.

Well over 150 similar lawsuits have been filed against other entities impacted by the MOVEit incident including a number of such lawsuits related to PBI’s use of MOVEit.

On October 4, 2023, the U.S.

Judicial Panel on Multidistrict Litigation (JPML) created a multidistrict litigation (MDL) pursuant to 28 U.S.C.

§ 1407 to handle all litigation brought by individuals whose information was potentially compromised in connection with the alleged MOVEit vulnerability.

The JPML assigned the MDL to Judge Allison Burroughs of the U.S.

District Court for the District of Massachusetts.

Both Miller and Cooper have been transferred to Judge Burroughs in the MDL.

Following creation of the MDL, Judge Burroughs conducted an initial case management conference on November 30, 2023, and appointed lead plaintiffs’ counsel on January 19, 2024.

Judge Burroughs is currently considering the parties’ case management schedule proposals submitted on February 16, 2024.

Judge Burroughs is likely to issue a Case Management Order with additional processes and a preliminary schedule as a next step in the consolidated litigations.

In connection with the cybersecurity incident initially reported on November 21, 2023, the Company and/or its subsidiaries are named as defendants in putative class action lawsuits recently filed in the U.S.

District Courts for the Middle District of Florida and the Central District of California, and the Western District of Missouri.

The putative class actions include common law tort and contract claims, and some include certain state statutory claims.

The Company has not yet filed responses to these lawsuits.

The putative class action lawsuits also include overlapping class definitions for which a class has not been

Because of the procedural posture of these lawsuits and the factual issues involved, the Company has not yet been able to assess the probability of loss or estimate the possible loss or the range of loss.

From time to time, we receive inquiries and requests for information from state insurance departments, attorneys general and other regulatory agencies about various matters relating to our business.

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Certain of these amounts are maintained in segregated bank accounts and have not been included in the accompanying Consolidated Balance Sheets, consistent with GAAP and industry practice.

These balances amounted to $ 18.9 billion and $ 30.5 billion at December 31, 2022 and 2021, respectively.

These balances amounted t o $ 13.5 billion a nd $ 18.9 billion at December 31, 2023 and 2022, respectively.

As a result of holding these customers’ assets in escrow, we have ongoing programs for realizing economic benefits during the year through favorable borrowing and vendor arrangements with various banks.

There were no investments or loans outstanding as of December 31, 2023 and 2022 related to these arrangements.

FNF Commitments

As of December 31, 2022, we had a commitment to purchase TitlePoint for $ 225 million.

On January 1, 2023, we completed our previously announced acquisition of TitlePoint for $ 225 million in cash, subject to a customary working capital adjustment.

For further information associated with the purchase of TitlePoint, refer to Note A Business and Summary of Significant Accounting Policies.

F&G Commitments

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A summary of unfunded commitments by invested asset class is included below:

December 31, 2022 December 31, 2021

Asset Type (In millions)

December 31, 2023

Commitment Type (In millions)

Unconsolidated VIEs:

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Fixed maturity securities, ABS 244

Direct Lending 667

Other fixed maturity securities, AFS 14

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Commercial mortgage loans 72

Residential mortgage loans 2 —

Other invested assets 15

Committed amounts included in liabilities —

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See Note A Business and Summary of Significant Accounting Policies , for discussion of funding agreements that have been issued pursuant to the FABN Program as well as to the FHLB that are included in Contractholder funds.

As discussed in Note O F&G Reinsurance , to enhance Kubera's ability to pay its obligations under the amended reinsurance agreement, effective October 31, 2021, F&G entered into a Variable Note Purchase Agreement (the “NPA”), whereby F&G agreed to fund a note to Kubera to be used to ultimately settle with F&G, with principal increases up to a maximum amount of $ 300 million, to the extent a potential funding shortfall (treaty assets are less than the total funding requirement) is projected relative to the business ceded to Kubera from F&G as part of the amended reinsurance agreement.

F&G has a reinsurance agreement with Kubera to cede certain FIA statutory reserves on a coinsurance funds withheld basis, net of applicable existing reinsurance.

To enhance Kubera's ability to pay its obligations under the amended reinsurance agreement, effective October 31, 2021, F&G entered into a Variable Note Purchase Agreement (the “NPA”), whereby F&G agreed to fund a note to Kubera to be used to ultimately settle with F&G, with principal increases up to a maximum amount of $ 300 million, to the extent a potential funding shortfall (treaty assets are less than the total funding requirement) is projected relative to the business ceded to Kubera from F&G as part of the amended reinsurance agreement.

The potential funding shortfall will be determined quarterly and, among other items, is impacted by the market value of the assets in the funds withheld account related to the reinsurance agreement and Kubera's capital as calculated on a Bermuda regulatory basis.

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Based on the current level of the treaty assets and projections that these policies will be profitable over the lifetime of the agreement, we do not expect significant fundings to occur under the NPA.

As of December 31, 2022 and December 31, 2021, the amount funded under the NPA was insignificant.

As of December 31, 2023 and 2022, the amount funded under the NPA was insignificant.

Note I — Dividends

On February 14, 2024, our Board of Directors declared cash dividends of $ 0.48 per share, payable on March 29, 2024, to FNF common shareholders of record as of March 15, 2024.

During the years ended December 31, 2023, 2022, and 2021 we declared dividends on our common stock of $ 1.83 , $ 1.77 , and $ 1.56 respectively.

Note J — Segment Information

Summarized financial information concerning our reportable segments is shown in the following tables.

On June 1, 2020, we completed our acquisition of F&G.

As a result, the year ended December 31, 2020 includes seven months of activity from our F&G segment.

As of and for the year ended December 31, 2023:

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2023 2022 2021

(In millions)

Cash paid for:

(In millions)

Interest $ 157 $ 125 $ 112

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Non-cash investing and financing activities:

Equity financing associated with the acquisition of F&G $ — $ — $ 609

Distribution of 15 % of the common stock of F&G

$ — $ 421 $ —

Investments received from pension risk transfer premiums 464 — 316

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Remeasurement of lease liabilities 75 60 87

Liabilities assumed in connection with acquisitions (excluding F&G)(1)

Liabilities assumed in connection with acquisitions

Fair value of assets acquired 304 266 85

1 unchanged sentence

Liabilities and noncontrolling interests assumed $ 5 $ 86 $ 26

(1) For further information related to the acquisition of F&G, refer to Note B Acquisitions

Note L — Revenue Recognition

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Real estate technology Escrow, title-related and other fees Corporate and other 151 158 142

Real estate brokerage Escrow, title-related and other fees Corporate and other — — 25

Total revenue from contracts with customers 1,863 2,232 2,821

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While the base contract has been reinsured, we continue to retain the return of premium rider.

Insurance and investment product fees and other consist primarily of the cost of insurance on IUL policies, unearned revenue ("UREV") on IUL policies, policy rider fees primarily on FIA

policies and surrender charges assessed against policy withdrawals in excess of the policyholder's allowable penalty-free amounts.

Insurance and investment product fees and other consist primarily of the cost of insurance on IUL policies, UREV on IUL policies, policy rider fees primarily on FIA policies and surrender charges assessed against policy withdrawals in excess of the policyholder's allowable penalty-free amounts.

Premium and annuity deposit collections for FIA, fixed rate annuities, immediate annuities and PRT without life contingency, and amounts received for funding agreements are reported in the financial statements as deposit liabilities (i.e., contractholder funds) instead of as sales or revenues.

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Components of expenses for products accounted for as deposit liabilities are interest-sensitive and index product benefits (primarily interest credited to account balances or the hedging cost of providing index credits to the policyholder), amortization of DAC, DSI, and VOBA, other operating costs and expenses, and income taxes.

Premiums, annuity deposits (net of reinsurance) and funding agreements, which are not included as revenues in the accompanying Consolidated Statements of Earnings, collected by product type were as follows:

Premiums, annuity deposits (net of reinsurance and reinsurance recoverable) and funding agreements, which are not included as revenues in the accompanying Consolidated Statements of Earnings, collected by product type were as follows:

December 31, 2023 December 31, 2022 December 31, 2021

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Revenue is recognized in the month services are provided.

Real estate brokerage revenues are primarily comprised of commission revenues earned in association with the facilitation of real estate transactions and are recognized upon closing of the sale of the underlying real estate transaction.

Loan subservicing revenues are generated by certain subsidiaries of ServiceLink and are associated with the servicing of mortgage loans on behalf of its customers.

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Note M — Other Intangible Assets

A summary of the changes in the carrying amounts of our VOBA, DAC and DSI intangible assets are as follows (in millions):

VOBA DAC DSI Total

The following table reconciles to Other intangible assets, net, on the Consolidated Balance Sheets as of December 31, 2023 and December 31, 2022:

December 31, 2023 December 31, 2022

(In millions)

Customer relationships and contracts $ 174 $ 202

VOBA 1,446 1,615

DAC 2,215 1,411

Value of distribution asset 86 100

Computer software 266 196

Trademarks, tradenames, and other 94 87

Total Other intangible assets, net $ 4,627 $ 3,811

The following tables roll forward VOBA by product for the years ended December 31, 2023 and December 31, 2022:

FIA Fixed Rate Annuities Immediate Annuities Universal Life Traditional Life Total

(In millions)

Balance at January 1, 2023

Purchase price allocation adjustments — — —

Deferrals — 727 87 814

$ 1,166 $ 32 $ 201 $ 143 $ 73 $ 1,615

Amortization ( 141 ) ( 5 ) ( 10 ) ( 9 ) ( 4 ) ( 169 )

Interest 25 30 2 57

Unlocking ( 5 ) ( 4 ) 5 ( 4 )

Adjustment for net unrealized investment (gains) losses 662 182 68 912

Balance at December 31, 2023

VOBA DAC DSI Total

$ 1,025 $ 27 $ 191 $ 134 $ 69 $ 1,446

FIA Fixed Rate Annuities Immediate Annuities Universal Life Traditional Life Total

(In millions)

Balance at January 1, 2022

Purchase price allocation adjustments 61 — — 61

Deferrals — 585 90 675

$ 1,314 $ 39 $ 212 $ 153 $ 25 $ 1,743

Amortization ( 148 ) ( 7 ) ( 11 ) ( 10 ) ( 4 ) ( 180 )

Interest 30 13 1 44

Unlocking 13 1 ( 2 ) 12

Adjustment for net unrealized investment (losses) gains 51 ( 14 ) ( 2 ) 35

Shadow Premium Deficiency Testing (“PDT”) — — — — 52 52

Balance at December 31, 2022

Amortization of VOBA, DAC, and DSI is based on the current and future expected gross margins or profits recognized, including investment gains and losses.

The interest accrual rate utilized to calculate the accretion of interest on VOBA ranged from 0 % to 4.71 % for the years ended December 31, 2022 and December 31, 2021.

The adjustment for unrealized net investment losses (gains) represents the amount of VOBA, DAC, and DSI that would have been amortized if such unrealized gains and losses had been recognized.

This is referred to as the “shadow adjustments” as the additional amortization is reflected in AOCI On the Consolidated Balance Sheet rather than as depreciation and amortization on the Consolidated Statements of Earnings.

As of December 31, 2022 and 2021, the VOBA balances included cumulative adjustments for net unrealized investment gains (losses) of $( 430 ) million and $ 232 million respectively, the DAC balances included cumulative adjustments for net unrealized investment gains (losses) of $( 143 ) million and $ 39 million, respectively, and the DSI balance included net unrealized investment gains of $( 61 ) million and $ 7 million, respectively.

For the in-force liabilities as of December 31, 2022, the estimated amortization expense for VOBA in future fiscal periods is as follows (in millions):

Estimated Amortization Expense

$ 1,166 $ 32 $ 201 $ 143 $ 73 $ 1,615

VOBA amortization expense of $ 169 million, $ 180 million, and $ 195 million, was recorded in Depreciation and amortization on the Consolidated Statements of Earnings for the years ended December 31, 2023, 2022, and 2021 respectively.

The following table presents a reconciliation of VOBA to the table above which is reconciled to the Consolidated Balance Sheets as of December 31, 2023 and December 31, 2022:

December 31, 2023 December 31, 2022

(In millions)

FIA $ 1,025 $ 1,166

Fixed Rate Annuities 27 32

Immediate Annuities 191 201

Universal Life 134 143

Traditional Life 69 73

Total $ 1,446 $ 1,615

The following tables roll forward DAC by product for the years ended December 31, 2023 and December 31, 2022:

FIA Fixed Rate Annuities Universal Life Total (a)

(In millions)

Balance at January 1, 2023

$ 971 $ 83 $ 348 $ 1,402

Capitalization 510 177 229 916

Amortization ( 103 ) ( 51 ) ( 32 ) ( 186 )

Reinsurance related adjustments — 79 — 79

Balance at December 31, 2023

$ 1,378 $ 288 $ 545 $ 2,211

FIA Fixed Rate Annuities Universal Life Total (a)

(In millions)

Balance at January 1, 2022

$ 564 $ 38 $ 173 $ 775

Capitalization 474 56 196 726

Amortization ( 67 ) ( 11 ) ( 21 ) ( 99 )

Balance at December 31, 2022

$ 971 $ 83 $ 348 $ 1,402

(a) Excludes insignificant amounts of DAC related to FABN.

DAC amortization expense of $ 186 million, $ 99 million, and $ 46 million, was recorded in Depreciation and amortization on the Consolidated Statements of Earnings for the year s ended December 31, 2023, 2022, and 2021, respectively, excluding insignificant amounts related to FABN.

The following table presents a reconciliation of DAC to the table above which is reconciled to the Consolidated Balance Sheets as of December 31, 2023 and December 31, 2022:

December 31, 2023 December 31, 2022

(In millions)

FIA $ 1,378 $ 971

Fixed Rate Annuities 288 83

Universal Life 545 348

Funding Agreements 4 9

Total $ 2,215 $ 1,411

The following tables roll forward DSI for the years ended December 31, 2023 and December 31, 2022:

(In millions)

Balance at January 1, 2023

Capitalization 168 168

Amortization ( 22 ) ( 22 )

Balance at December 31, 2023

(In millions)

Balance at January 1, 2022

Capitalization 87 87

Amortization ( 14 ) ( 14 )

Balance at December 31, 2022

DSI amortization expense of $ 22 million, $ 14 million, and $ 7 million, was recorded in Depreciation and amortization on the Consolidated Statements of Earnings for the years ended December 31, 2023, 2022, and 2021, respectively.

The following table presents a reconciliation of DSI to the table above which is reconciled to the Consolidated Balance Sheets as of December 31, 2023 and December 31, 2022:

December 31, 2023 December 31, 2022

(In millions)

FIA $ 346 $ 200

Total $ 346 $ 200

The cash flow assumptions used to amortize VOBA and DAC were consistent with the assumptions used to estimate the FPB for life contingent immediate annuities, and will be reviewed and unlocked, if applicable, in the same period as those balances.

For nonparticipating traditional life contracts, the VOBA amortization is straight-line, without the use of cash flow assumptions.

For FIA contracts, the cash flow assumptions used to amortize VOBA, DAC, and DSI were consistent with the assumptions used to estimate the value of the embedded derivative and MRBs, and will be reviewed and unlocked, if applicable, in the same period as those balances.

For fixed rate annuities and IUL the cash flow assumptions used to amortize VOBA, DAC and DSI reflect the Company’s best estimates for policyholder behavior, consistent with the development of assumptions for FIA and immediate annuity.

Refer to Note A - Business and Summary of Significant Accounting Policies for further information about accounting policies for amortization of VOBA, DAC and DSI.

We review cash flow assumptions annually, generally in the third quarter.

In 2023, F&G undertook a review of all significant assumptions and revised several assumptions relating to our deferred annuity (FIA and fixed rate annuity) and IUL products, including surrender rates, partial withdrawal rates, mortality improvement, premium persistency, and option budgets.

All updates to these assumptions brought us more in line with our company and overall industry experience since the prior assumption update.

In 2022, F&G undertook a review of all significant assumptions and revised GMWB utilization for our deferred annuity contracts (FIA and fixed rate annuities) to reflect internal and industry experience in the first several contract years.

For the in-force liabilities as of December 31, 2023, the estimated amortization expense for VOBA in future fiscal periods is as follows:

Estimated Amortization Expense

Fiscal Year (In millions)

Thereafter 810

Total $ 1,446

Definite and Indefinite Lived Other Intangible Assets

Other intangible assets as of December 31, 2022 consist of the following (in millions):

Other intangible assets as of December 31, 2023, consist of the following:

Cost Accumulated amortization Net carrying amount Weighted average useful life (years)

(In millions)

Customer relationships and contracts $ 948 $ ( 774 ) $ 174 10

1 unchanged sentence

Value of distribution asset (VODA) 140 ( 54 ) 86 15

Definite lived trademarks, tradenames, and other 56 ( 41 ) 15 10

Indefinite lived tradenames and other 60 N/A 60 Indefinite

Other intangible assets as of December 31, 2021 consist of the following (in millions):

Trademarks, tradenames, and other 146 ( 52 ) 94 Varies

Other intangible assets as of December 31, 2022, consist of the following:

Cost Accumulated amortization Net carrying amount Weighted average useful life (years)

(In millions)

Customer relationships and contracts $ 916 $ ( 714 ) $ 202 10

1 unchanged sentence

Value of distribution Asset (VODA) 140 ( 40 ) 100 15

Definite lived trademarks, tradenames, and other 49 ( 33 ) 16 10

Indefinite lived tradenames and other 59 N/A 59 Indefinite

Trademarks, tradenames, and other 129 ( 42 ) 87 Varies

Amortization expense for amortizable intangible assets, which consist primarily of VODA, customer relationships and computer software and definite lived trademarks, tradenames and other, was $ 152 million, $ 134 million, and $ 136 million for the years ended December 31, 2023, 2022 and 2021, respectively.

6 unchanged sentences

Goodwill associated with acquisitions 103 — — 103

Adjustments to prior year acquisitions $ 1 $ 5 $ — 6

Balance, December 31, 2022 $ 2,620 $ 1,749 $ 266 $ 4,635

2 unchanged sentences

Note O — F&G Reinsurance

F&G reinsures portions of its policy risks with other insurance companies.

The Company reinsures portions of its policy risks with other insurance companies.

The use of indemnity reinsurance does not discharge an insurer from liability on the insurance ceded.

The insurer is required to pay in full the amount of its insurance liability regardless of whether it is entitled to or able to receive payment from the reinsurer.

The portion of risks exceeding F&G's retention limit is reinsured.

F&G primarily seeks reinsurance coverage in order to limit its exposure to mortality losses and enhance capital management.

F&G follows reinsurance accounting when there is adequate risk transfer or deposit accounting if there is inadequate risk transfer.

If the underlying policy being reinsured is an investment contract, the effects of the agreement are accounted for as a separate investment contract.

The portion of risks exceeding the Company's retention limit is reinsured.

The Company primarily seeks reinsurance coverage in order to manage loss exposures, to enhance our capital position, to diversify risks and earnings, and to manage new business volume.

The Company follows reinsurance accounting when the treaty adequately transfers insurance risk.

Otherwise, the Company follows deposit accounting if there is inadequate transfer of insurance risk or if the underlying policy for which risk is being transferred is an investment contract that does not contain insurance risk.

Refer to Note A - Business and Summary of Significant Accounting Policies for more information over our accounting policy for reinsurance agreements.

The effect of reinsurance on net premiums earned and net benefits incurred (benefits paid and reserve changes) for the years ended December 31, 2022 and December 31, 2021, and the seven months ended December 31, 2020 were as follows (in millions):

Year Ended Seven months ended

December 31, 2022 December 31, 2021 December 31, 2020

The effects of reinsurance on net premiums earned and net benefits incurred (benefits paid and reserve changes) for the years ended December 31, 2023, 2022, and 2021 respectively, were as follows (in millions):

Year Ended December 31,

2023 2022 2021

Net Premiums Earned Net Benefits Incurred Net Premiums Earned Net Benefits Incurred Net Premiums Earned Net Benefits Incurred

Direct $ 2,112 $ 3,728 $ 1,522 $ 3,640 $ 1,314 $ 3,070

Assumed — — — — — 1

Ceded ( 105 ) ( 175 ) ( 128 ) ( 2,514 ) ( 137 ) ( 1,138 )

1 unchanged sentence

Amounts payable or recoverable for reinsurance on paid and unpaid claims are not subject to periodic or maximum limits.

F&G did not write off any significant reinsurance balances during the years ended December 31, 2022 and December 31, 2021, or the seven months ended December 31, 2020.

F&G did not commute any ceded reinsurance treaties during the years ended December 31, 2022 and December 31, 2021, or the seven months ended December 31, 2020.

F&G estimates expected credit losses on reinsurance recoverables using a probability of default/loss given default model.

No policies issued by the Company have been reinsured with any foreign company, which is controlled, either directly or

indirectly, by a party not primarily engaged in the business of insurance.

The Company has not entered into any reinsurance agreements in which the reinsurer may unilaterally cancel any reinsurance for reasons other than non-payment of premiums or other similar credit issues.

The following summarizes our reinsurance recoverable (in millions):

Parent Company/

Principal Reinsurers Reinsurance Recoverable (a) Agreement Type Products

Covered Accounting

December 31, 2023 December 31, 2022

Aspida Life Re Ltd $ 6,128 $ 3,121 Coinsurance Funds Withheld Certain MYGA (b) Deposit

Wilton Reassurance Company 1,092 1,231 Coinsurance Block of traditional, IUL and UL (c) Reinsurance

Somerset Reinsurance Ltd 716 570 Coinsurance Funds Withheld Certain MYGA (b) and DA Deposit

Everlake Life Insurance Company 509 — Coinsurance (d) Certain MYGA (b) (d) Deposit

Other (e) 536 505

Reinsurance recoverable, gross of allowance for credit losses 8,981 5,427

Allowance for expected credit loss ( 21 ) ( 10 )

Reinsurance recoverable, net of allowance for credit losses $ 8,960 $ 5,417

(a) Reinsurance recoverables do not include unearned ceded premiums that would be recovered in the event of early termination of certain traditional life policies.

(b) As of the years ended December 31, 2023 and 2022, the combined quota share flow reinsurance amongst all reinsurers was 90 % and 75 %, respectively.

(c) Also includes certain FGL Insurance life insurance policies that are subject to redundant reserves, reported on a statutory basis, under Regulation XXX and Guideline AXXX.

(d) Reinsurance recoverable is collateralized by assets placed in a statutory comfort trust by the reinsurer and maintained for our sole benefit.

(e) Represents all other reinsurers, with no single reinsurer having a carrying value in excess of 5% of total reinsurance recoverable.

The Company incurred risk charge fees of $ 39 million, $ 36 million, and $ 28 million during the years ended December 31, 2023, 2022, and 2021, respectively, in relation to reinsurance agreements.

Credit Losses

The Company estimates expected credit losses on reinsurance recoverables using a probability of default/loss given default model.

Significant inputs to the model include the reinsurer's credit risk, expected timing of recovery, industry-wide historical default experience, senior unsecured bond recovery rates, and credit enhancement features.

As of the June 1, 2020 acquisition of F&G, due to purchase accounting adjustments, our expected credit loss reserve was valued at $ 0 .

For the seven months ended December 31, 2020, the expected credit loss reserve increased from $ 0 to $ 21 million.

As of December 31, 2022 and December 31, 2021, the expected credit loss reserve was $ 10 million and $ 20 million, respectively.

No policies issued by F&G have been reinsured with any foreign company, which is controlled, either directly or indirectly, by a party not primarily engaged in the business of insurance.

F&G has not entered into any reinsurance agreements in which the reinsurer may unilaterally cancel any reinsurance for reasons other than non-payment of premiums or other similar credit issues.

New Reinsurance Transaction.

Effective December 31, 2022, F&G entered into an indemnity reinsurance agreement with New Reinsurance Company Ltd.

("New Re"), a third-party reinsurer, to cede a quota share of certain FIA policies and related waiver of surrender charges, issued after January 1, 2022, on a coinsurance and yearly renewable term basis.

The coinsurance quota share is only applicable to the base contract benefits under the FIA policies.

The yearly renewable term is applicable to the waiver of surrender charges.

As the FIA policies ceded do not include any GMWB or GMDB benefits, there is no significant insurance risk present and therefore the effects of this agreement are accounted for as a separate investment contract.

Aspida Reinsurance Transaction.

F&G executed a Funds Withheld Coinsurance Agreement with Aspida Re, a Bermuda reinsurer.

In accordance with the terms of this agreement, F&G cedes to the reinsurer, on a fifty percent ( 50 %) funds withheld coinsurance basis, certain multiyear guaranteed annuity business written effective January 1, 2021.

The agreement was originally executed January 15, 2021 and amended in August 2021 and September 2022.

For reinsured policies issued prior to September 1, 2022, the policies are ceded on a fifty percent ( 50 %) quota share basis.

For reinsured policies issued on or after September 1, 2022, the policies are ceded on a seventy-five percent ( 75 %) quota share basis, capped at $ 350 million cession per month.

As the policies ceded to Aspida are investment contracts, there is no significant insurance risk present and therefore the effects of this agreement are accounted for as a separate investment contract.

Somerset Reinsurance Transaction.

F&G entered into a reinsurance agreement with Kubera, a third-party reinsurer, effective December 31, 2018, to cede certain MYGA and deferred annuity GAAP and statutory reserves on a coinsurance funds withheld basis, net of applicable existing reinsurance.

In accordance with the terms of this agreement, F&G cedes a quota share percentage of MYGA and deferred annuity policies for certain issue years to Kubera.

Effective October 31, 2021, this agreement was novated from Kubera to Somerset, a certified third-party reinsurer.

This agreement cedes GAAP and statutory reserves of approximately $ 1 billion.

As the policies ceded to Somerset are investment contracts, there is no significant insurance risk present and therefore the effects of this agreement are accounted for as a separate investment contract.

Kubera Reinsurance Transaction.

F&G has a reinsurance agreement with Kubera to cede certain FIA statutory reserves on a coinsurance funds withheld basis, net of applicable existing reinsurance.

In accordance with the terms of this agreement, F&G cedes a quota share percentage of FIA policies for certain issue years to Kubera.

Effective October 31, 2021, this agreement was amended to increase the ceded reserves from approximately $ 4 billion to approximately $ 10 billion.

The agreement was subsequently amended and restated on October 1, 2022 whereby F&G recaptured approximately $ 52 million in statutory reserves solely related to waiver of surrender charges.

As the policies ceded to Kubera are investment contracts, there

is no significant insurance risk present and therefore the reinsurance agreement is accounted for as a separate investment contract.

F&G incurred risk charge fees of $ 12 million $ 5 million, and $ 4 million during the years ended December 31, 2022 and December 31, 2021, or the seven months ended December 31, 2020, respectively, in relation to this reinsurance agreement.

To enhance Kubera's ability to pay its obligations under the amended reinsurance agreement, F&G entered into a Variable Note Purchase Agreement (the “NPA”), whereby F&G agreed to fund a note to Kubera to be used to ultimately settle with F&G, with principal increases up to a maximum amount of $ 300 million, to the extent a potential funding shortfall (treaty assets are less than the total funding requirement) is projected relative to the business ceded to Kubera from F&G as part of the amended reinsurance agreement.

The NPA matures on November 30, 2071.

As of December 31, 2022 and December 31, 2021, the amount funded under the NPA was insignificant.

Canada Life Reinsurance Transaction.

Effective May 1, 2020, F&G entered into an indemnity reinsurance agreement with Canada Life Assurance Company United States Branch, a third-party reinsurer, to reinsure FIA policies with GMWB.

In accordance with the terms of this agreement, F&G cedes a quota share percentage of the net retention of guarantee payments in excess of account value for GMWB.

This treaty was amended effective January 1, 2021 and January 1, 2022, and covers FIA policies with GMWB issued from January 1, 2020 to December 31, 2023.

Effective October 1, 2022, the treaty was then amended and restated to cover additional FIA business policies.

The effects of this agreement are not accounted for as reinsurance as it does not satisfy the risk transfer requirements for GAAP;

therefore, deposit accounting is applied.

F&G incurred risk charge fees of $ 4 million, $ 2 million and $ 1 million during the years ended December 31, 2022 and December 31, 2021, and the seven months ended December 31, 2020, respectively, in relation to this reinsurance agreement.

Hannover Reinsurance Transaction.

F&G has an indemnity reinsurance agreement with Hannover Re, a third-party reinsurer, to cede a quota share percentage of the net retention of guarantee payments in excess of account value for GMWB and GMDB guarantees associated with an in-force block of its FIA and fixed deferred annuity contracts.

The effects of this agreement are not accounted for as reinsurance as it does not satisfy the risk transfer requirements for GAAP;

therefore, deposit accounting is applied.

F&G incurred risk charge fees of $ 20 million, $ 21 million and $ 12 million during the years ended December 31, 2022 and December 31, 2021, or the seven months ended December 31, 2020, respectively, in relation to this reinsurance agreement.

Wilton Reinsurance Transaction .

Pursuant to the agreed upon terms, Wilton Reassurance Company (“Wilton Re”) purchased through a 100 % quota share reinsurance agreement certain FGL Insurance life insurance policies that are subject to redundant reserves, reported on a statutory basis, under Regulation XXX and Guideline AXXX, as well as another block of FGL Insurance’s in-force traditional, universal life and IUL insurance policies.

The effects of this agreement are accounted for as reinsurance as the ceded policies qualify as insurance products and because the agreement satisfies the risk transfer requirements for GAAP.

The expected credit loss reserves were as follows (in millions):

December 31, 2023 December 31, 2022

Balance at Beginning of Period $ ( 10 ) $ ( 20 )

Provision for losses ( 11 ) 10

Charge offs — —

Balance at End of Period $ ( 21 ) $ ( 10 )

Concentration of Reinsurance Risk

The Company has a significant concentration of reinsurance risk with third-party reinsurers, Aspida Re, Wilton Reassurance Company (“Wilton Re”), and Somerset that could have a material impact on our financial position in the event that any of these reinsurers fails to perform its obligations under the various reinsurance treaties.

Aspida Re has an A- issuer credit rating from AM Best as of December 31, 2022, and the risk of non-performance is further mitigated through the funds withheld arrangement.

Wilton Re has an A+ issuer credit rating from AM Best and an A issuer credit rating from Fitch as of December 31, 2022.

Somerset has an A- issuer credit rating from AM Best and a BBB+ issuer credit rating from S&P as of December 31, 2022, and the risk of non-performance is further mitigated through the funds withheld arrangement.

On December 31, 2022, the net amounts recoverable from Aspida Re, Wilton Re, and Somerset were $ 3,121 million, $ 1,231 million, and $ 570 million, respectively.

We monitor both the financial condition of individual reinsurers and risk concentration arising from similar activities and economic characteristics of reinsurers to attempt to reduce the risk of default by such reinsurers.

We believe that all amounts due from Aspida Re, Wilton Re, and Somerset for periodic treaty settlements are collectible as of December 31, 2022.

As indicated above, the Company has a significant concentration of reinsurance risk with third party reinsurers, Aspida Re, Wilton Reinsurance (“Wilton Re”), Somerset and Everlake Life Insurance Company (“Everlake”) that could have a material impact on our financial position in the event that any of these reinsurers fails to perform its obligations under the various reinsurance treaties.

We monitor the financial condition and financial strength of individual reinsurers using public ratings (refer to table below) and ratings reports of individual reinsurers to attempt to reduce the risk of default by such reinsurers.

In addition, the risk of non-performance is further mitigated with various forms of collateral or collateral arrangements, including secured trusts, funds withheld accounts and irrevocable letters of credit.

We believe that all amounts due from Aspida Re, Wilton Re, Somerset and Everlake for periodic treaty settlements, net of any applicable credit loss reserves, are collectible as of December 31, 2023.

The following table presents financial strength ratings as of December 31, 2023:

Parent Company/Principal Reinsurers Financial Strength Rating

AM Best S&P Fitch Moody's

Aspida Life Re Ltd A- not rated not rated not rated

Wilton Re A+ not rated A not rated

Somerset Reinsurance Ltd A- BBB+ not rated not rated

Everlake A+ not rated not rated not rated

Reinsurance Transactions

The following summarizes significant changes to third-party reinsurance agreements for the year ended December 31, 2023:

Everlake and Somerset:

The Company executed flow reinsurance agreements with Everlake and Somerset, third-party reinsurers, to cede certain MYGA business written effective September 1, 2023, and December 1, 2023, respectively, on a coinsurance quota share basis.

Effective May 1, 2020, the Company entered into an indemnity reinsurance agreement with Canada Life Assurance Company (“Canada Life”) United States Branch, a third-party reinsurer, to reinsure FIA policies with GMWB Riders.

In accordance with the terms of this agreement, F&G cedes a quota share percentage of the net retention of guaranteed payments in excess of account value for GMWB.

Effective December 31, 2023, we entered a Recapture and Termination Agreement with Canada Life whereby 100 % of the liabilities and obligations were recaptured.

There were no significant changes to third party reinsurance agreements for the year ended December 31, 2022 .

Intercompany Reinsurance Agreements

Effective December 31, 2022, FGL Insurance entered into a Coinsurance Agreement with F&G Life Re Ltd.

("Reinsurer"), an affiliated Bermuda reinsurer to issue a quota share of PRT group annuity contracts.

Some of the contracts reinsured are held by FGL Insurance’s general account and others are held by a FGL Insurance separate account (which does not meet the GAAP definition of a separate account).

The cession from FGL Insurance to the Reinsurer is on a 80 % quota share basis.

Reinsurance of the separate account contracts are maintained on a modified coinsurance basis and reinsurance of the

general account contracts are maintained on a funds withheld basis.

On the funds withheld portion of the transaction, FGL Insurance ceded approximately $ 380 million, in certain PRT Statutory Reserves and Interest Maintenance Reserve.

FGL Insurance also established a modified coinsurance reserve of approximately $ 1.7 billion associated with the PRT Separate Account Insurance Liabilities.

F&G has a reinsurance treaty with Raven Reinsurance Company ("Raven Re"), its wholly-owned captive reinsurance company, to cede the Commissioners Annuity Reserve Valuation Method ("CARVM") liability for annuity benefits where surrender charges are waived related to certain FIA, DA and MYGA policies.

Effective October 1, 2022, the treaty was amended and restated to cover additional FIA, DA and MYGA policy issue years.

In connection with the CARVM reinsurance agreement, FGL Insurance and Raven Re entered into an agreement with Nomura Bank International plc (“NBI”) to establish a reserve financing facility in the form of a letter of credit issued by NBI.

The reimbursement agreement associated with the facility was amended and restated on September 30, 2022.

As a result, the financing facility now has $ 200 million available to draw on as of December 31, 2022.

The amended facility may terminate earlier than the current termination date of October 1, 2027, in accordance with the terms of the reimbursement agreement.

Under the terms of the reimbursement agreement, in the event the letter of credit is drawn upon, Raven Re is required to repay the amounts utilized, and Fidelity & Guaranty Life Holdings, Inc.

("FGLH") is obligated to repay the amounts utilized if Raven Re fails to make the required reimbursement.

FGLH also is required to make capital contributions to Raven Re in the event that Raven Re’s statutory capital and surplus falls below certain defined levels.

As of December 31, 2022 and December 31, 2021, Raven Re’s statutory capital and surplus was $ 11 million and $ 62 million, respectively, in excess of the minimum level required under the reimbursement agreement.

As this letter of credit is provided by an unaffiliated financial institution, Raven Re is permitted to carry the letter of credit as an admitted asset on the Raven Re statutory balance sheet.

Effective December 31, 2020, FGL Insurance executed a Coinsurance Agreement with F&G Life Re Ltd.

("Reinsurer"), an affiliated Bermuda reinsurer, to reinsure a quota share of FIA policies to the Reinsurer.

Concurrently, the Reinsurer and F&G Cayman Re Ltd., an affiliated reinsurer of both FGL Insurance and the Reinsurer, entered into a Retrocession Agreement.

The cession from FGL Insurance to the Reinsurer is on a 100 % quota share basis, net of applicable existing reinsurance and the retrocession to F&G Cayman Re Ltd.

from the Reinsurer is on a 45 % quota share basis.

Additionally, both treaties are maintained on a funds withheld basis.

FGL Insurance ceded and the Reinsurer retroceded approximately $ 5.0 billion and $ 2.2 billion, respectively, in certain FIA Statutory Reserves and Interest Maintenance Reserve.

The Company executes various intercompany reinsurance agreements between its insurance subsidiaries, including offshore entities, for purposes of managing regulatory statutory capital and risk.

Since these agreements are intercompany, the financial impacts are eliminated in the preparation of the Consolidated Financial Statements included within this Annual Report on Form 10-K.

Some of these intercompany transactions are executed with wholly owned reinsurance subsidiaries, Corbeau Re, Inc.

(“Corbeau Re”), Raven Reinsurance Company (“Raven Re”) and F&G Cayman Re (“Cayman Re”), to finance the portion of statutory reserves considered to be non-economic.

The financing arrangements involve FGLIC reinsuring certain annuity products and their related rider benefits to the captives and the captives executing third-party financing facilities that are classified as capital for statutory purposes.

The transaction with Raven Re and Cayman Re included the execution of letter of credits with Nomura Bank International plc (“NBI”) and Deutsche Bank AG (“DB”), respectively, that are undrawn and have maximum borrowing capacities of $ 200 million and $ 200 million, respectively, as of December 31, 2023.

The transaction with Corbeau Re included the execution of an excess of loss agreement (“XOL”) with Canada Life Barbados Branch that matures on December 31, 2043, and provides for coverage on losses up to $ 1,500 million as of December 31, 2023.

With Corbeau Re, non-economic reserves were financed through the maturity date of the XOL and statutory reserves are recorded for all risks expected to be incurred after the maturity date of the XOL.

The XOL is not accounted for as reinsurance as it does not satisfy the risk transfer requirements for GAAP;

therefore, deposit accounting is applied.

Note P — Regulation and Equity

11 unchanged sentences

The level of unearned premium reserve required to be maintained at any time is determined by statutory formula based upon either the age, number of policies and dollar amount of policy liabilities underwritten, or the age and dollar amount of statutory premiums written.

As of December 31, 2022, the combined statutory unearned premium reserve required and reported for our title insurers was $ 1,772 million .

As of December 31, 2023, the combined statutory unearned premium reserve required and reported for our title insurers w as $ 1,659 million.

In addition to statutory unearned premium reserves, each of our insurers maintains reserves for known claims and surplus funds for policyholder protection and business operations.

2 unchanged sentences

Each of the insurers is subject to periodic regulatory financial examination by regulatory authorities.

Our insurance subsidiaries are subject to regulations that restrict their ability to pay dividends or make other distributions of cash or property to their immediate parent company without prior approval from the Department of Insurance of their respective states of domicile.

Our insurance subsidiaries are subject to regulations that restrict their ability to pay dividends or make other distributions of cash or property to their immediate par ent company without prior approval from the Department of Insurance of their respective states of domicile.

As of December 31, 2023, $ 1,145 million of our net assets are restricted from dividend payments without prior approval from the Departments of Insurance.

11 unchanged sentences

There are no restrictions on our retained earnings regarding our ability to pay dividends to shareholders although there are limits on the ability of certain subsidiaries to pay dividends to us, as described above.

Through our wholly owned F&G subsidiary, our U.S.

insurance subsidiaries, FGL Insurance, Fidelity & Guaranty Life Insurance Company of New York ("FGL NY Insurance"), and Raven Re, file financial statements with state insurance regulatory authorities and the NAIC that are prepared in accordance with SAP prescribed or permitted by such authorities, which may vary materially from GAAP.

Through our wholly owned F&G subsidiary, our insurance subsidiaries, FGL Insurance, FGL NY Insurance, Raven Re and Corbeau Re file financial statements with state insurance regulatory authorities and, with the exception of Raven Re, with the National Association of Insurance Commissioners (“NAIC”) that are prepared in accordance with Statutory Accounting Principles (“SAP”) prescribed or permitted by such authorities, which may vary materially from GAAP.

Prescribed SAP includes the Accounting Practices and Procedures Manual of the NAIC as well as state laws, regulations and administrative rules.

2 unchanged sentences

Accordingly, SAP operating results and SAP capital and surplus may differ substantially from amounts reported in the GAAP basis financial statements for comparable items.

Our principal insurance subsidiaries' statutory (SAP and GAAP) financial statements are based on a December 31 year end.

Statutory net income and statutory capital and surplus of our wholly owned U.S regulated insurance subsidiaries were as follows (in millions):

In or F&G segment, our principal insurance subsidiaries' statutory (SAP and GAAP) financial statements are based on a December 31 year end.

Statutory net income and statutory capital and surplus of our wholly owned U.S.

regulated insurance subsidiaries were as follows:

Subsidiary (state of domicile) (a)

FGL Insurance (IA) FGL NY Insurance (NY) Raven Re (VT)

FGL Insurance (IA) FGL NY Insurance (NY) Raven Re (VT) Corbeau Re (VT)

Statutory Net income (loss):

(In millions)

Year ended December 31, 2023 $ ( 462 ) $ 5 $ 60 $ ( 644 )

Year ended December 31, 2022 ( 243 ) ( 15 ) ( 111 ) —

Year ended December 31, 2021 351 4 3 —

Statutory Capital and Surplus:

1 unchanged sentence

December 31, 2022 1,877 82 121 —

(a) FGL NY Insurance and Raven Re are subsidiaries of FGL Insurance, and the columns should not be added together.

FGL Insurance, FGL NY Insurance and Raven Re's respective statutory capital and surplus satisfies the applicable minimum regulatory requirements.

Life insurance companies domiciled in the U.S.

are subject to certain Risk-Based Capital (“RBC”) requirements as specified by the NAIC.

The RBC is used to evaluate the adequacy of capital and surplus maintained by an insurance company in relation to risks associated with:

(a) FGL NY Insurance, Raven Re and Corbeau Re are subsidiaries of FGL Insurance, and the columns should not be added together.

Corbeau Re was incorporated on September 1, 2023.

Regulation - U.S.

FGL Insurance, FGL NY Insurance, Raven Re's and Corbeau Re’s respective statutory capital and surplus satisfy the applicable minimum regulatory requirements.

In order to enhance the regulation of insurers’ solvency, the NAIC adopted a model law to implement RBC requirements for life, health and property and casualty insurance companies.

All states have adopted the NAIC’s model law or a substantially similar law.

RBC is used to evaluate the adequacy of capital and surplus maintained by an insurance company in relation to risks associated with:

(i) asset risk, (ii) insurance risk, (iii) interest rate risk, and (iv) business risk.

We monitor the RBC of FGLH’s insurance subsidiaries.

As of December 31, 2022, each of FGLH's insurance subsidiaries had exceeded the minimum RBC requirements.

Our insurance subsidiaries domiciled in the U.S.

are restricted by state laws and regulations as to the amount of dividends they may pay to their parent, our wholly owned F&G subsidiary, without regulatory approval in any year, the purpose of which is to protect affected insurance policyholders, depositors or investors.

Any dividends in excess of limits are deemed “extraordinary” and require regulatory approval.

In addition, and pursuant to an order issued by the Iowa Commissioner on November 28, 2017, FGL Insurance may not pay any dividend or other distribution to shareholders prior to November 28, 2020 without the prior approval of the Iowa Commissioner.

During the years ended December 31, 2022 and 2021, upon approval by the Iowa Commissioner, FGL Insurance declared and paid extraordinary dividends of $ 0 million and $ 38 million to its parent, respectively.

FGL Insurance applies Iowa-prescribed accounting practices that permit Iowa-domiciled insurers to report equity call options used to economically hedge FIA index credits at amortized cost for statutory accounting purposes and to calculate FIA statutory reserves such that index credit returns will be included in the reserve only after crediting to the annuity contract.

Effective October 1, 2022, the Company incorporated IUL products under these Iowa-prescribed accounting practices.

This resulted in a $ 152 million and $ 106 million decrease to statutory capital and surplus at December 31, 2022 and 2021, respectively.

FGL Insurance’s statutory carrying value of Raven Re reflects the effect of permitted practices Raven Re received to treat the available amount of a letter of credit as an admitted asset, which increased Raven Re’s statutory capital and surplus by $ 200 million and $ 85 million at December 31, 2022 and 2021, respectively.

Raven Re is also permitted to follow Iowa prescribed statutory accounting practice for its reserves on reinsurance assumed from FGL Insurance, which increased Raven Re’s statutory capital and surplus by $ 28 million at December 31, 2022 and by $ 0 million at December 31, 2021.

Without such permitted statutory accounting practices, Raven Re’s statutory capital and surplus (deficit) would be $( 107 ) million as of December 31, 2022 and would be $ 30 million as of December 31, 2021, and its risk-based capital would not fall below the minimum regulatory requirements.

As of the most recent annual statutory financial statements filed with insurance regulators, the RBC ratios for FGL Insurance and FGL NY Insurance each exceeded the minimum RBC requirements.

The insurance laws of Iowa and New York regulate the amount of dividends that may be paid in any year by FGL Insurance and FGL NY Insurance, respectively.

Pursuant to Iowa insurance law, ordinary dividends are payments, together with all other such payments within the preceding twelve months, that do not exceed the greater of (i) 10% of FGL Insurance’s statutory surplus as regards policyholders as of December 31 of the preceding year;

or (ii) the net gain from operations of FGL Insurance (excluding realized capital gains) for the 12-month period ending December 31 of the preceding year.

Dividends in excess of FGL Insurance’s ordinary dividend capacity are referred to as extraordinary and require prior approval of the Iowa Insurance Commissioner.

FGL Insurance may only pay dividends out of statutory earned surplus.

FGL Insurance did not pay extraordinary dividends to FGAL for the years ended December 31, 2023 and 2022, and paid extraordinary dividends of $ 38 million during the year ended December 31, 2021.

Each year, FGL NY Insurance may pay a certain limited amount of ordinary dividends or other distributions without being required to obtain the prior consent of or the New York State Department of Financial Services (“NYDFS”).

However, to pay any dividends or distributions (including the payment of any dividends or distributions for which prior consent is not required), FGL NY Insurance must provide advance written notice to the NYDFS.

FGL NY Insurance has historically not paid dividends.

Prescribed and permitted practices

FGL Insurance - FGL Insurance applies Iowa-prescribed accounting practices prescribed by 191 Iowa Administrative Code 97, “Accounting for Certain Derivative Instruments Used to Hedge the Growth in Interest Credited for Indexed Insurance Products and Accounting for the Indexed Insurance Products Reserve”, for its FIA products, and as of October 1, 2022, IUL products.

Under these alternative accounting practices, the call option derivative instruments that hedge the growth in interest credited on index products are accounted for at amortized cost with the corresponding amortization recorded as a decrease to net investment income and indexed annuity reserves are calculated based on Standard Valuation Law and Actuarial Guideline XXXV assuming the market value of the call options associated with the current index term is zero regardless of the observable market value for such options.

This resulted in a $ 178 million increase and a $ 152 million decrease to statutory capital and surplus at December 31, 2023 and 2022, respectively.

In addition, based on a permitted practice received from the Iowa Insurance Division, FGL Insurance carries one of its limited partnership interests which qualifies for accounting under SSAP No.

48, “Investments in Joint Ventures, Partnerships and Limited Liability Companies”, on a net asset value per share basis.

This is a departure from SSAP No.

48 which requires such investments to be carried based on the investees underlying U.S.

GAAP equity (prior to any impairment considerations).

This resulted in increases to statutory capital and surplus of $ 16 million and $ 13 million at December 31, 2023 and 2022, respectively.

In addition, FGL Insurance’s statutory carrying value of Corbeau Re reflects the effect of permitted practices Corbeau Re received to treat the excess of loss as an admitted asset, which increased Corbeau Re’s statutory capital and surplus by $ 765 million at December 31, 2023.

Raven Re - Raven Re is also permitted to follow Iowa prescribed statutory accounting practice for its reserves on reinsurance assumed from FGL Insurance and also has approval to include as an admitted asset the value of a letter of credit serving as collateral for reinsurance credit taken by FGL Insurance.

Without such permitted statutory accounting practices, Raven Re’s statutory capital and surplus (deficit) would be $( 89 ) million and $( 107 ) million as of December 31, 2023 and 2022, respectively, and its risk-based capital would fall below the minimum regulatory requirements.

The letter of credit facility is collateralized by NAIC 1 rated debt securities.

If the permitted practice was revoked, the letter of credit could be replaced by the collateral assets with Nomura’s consent as discussed in Note O F&G Reinsurance .

If the permitted practice was revoked, the letter of credit could be replaced by the collateral assets with Nomura’s consent (refer to discussion of letter of credit in Note E- Reinsurance ).

FGL Insurance’s statutory carrying value of Raven Re was $ 140 million and $ 121 million at December 31, 2023 and 2022, respectively.

As of December 31, 2022, FGL NY Insurance did not follow any prescribed or permitted statutory accounting practices that differ from the NAIC's statutory accounting practices.

The prescribed and permitted statutory accounting practices have no impact on our Consolidated Financial Statements, which are prepared in accordance with GAAP.

Corbeau Re - Corbeau Re has four permitted practices pursuant to Vermont Statute, Title 8, Chapter 141 – (8 V.S.A.

§ 6048k(a)(2), whereby the Vermont Department authorizes the Company to (i) account for the amount equal to the excess of loss amount (“XOL Asset”) as an asset on its statutory financial statements;

(ii) calculate the reserves with respect to the Retirement Pro Contracts in accordance with the following reserving methodology:

the reserves are calculated as the present value of reinsured benefits when account value equals zero less the present value of reinsurance premiums from the winning integrated stream, floored at zero and capped as necessary to keep the net statutory reserve at the net cash surrender value.

For benefits associated with all other contracts (“the GMWB Riders”), the reserves are calculated as the statutory reserves for the entire contract (i.e., the base contracts plus the GMWB Riders) minus the statutory reserves for the base contracts only (“Reserve Calculation Permitted Practice”);

(iii) calculate its company action level risk-based capital as defined in Section 8301(13)(A) and, calculated using the risk-based capital factors and formulas prescribed by the NAIC, applying a factor of 0.62% to the XOL Asset Value;

and (iv) annually perform a total company solvency analysis in lieu of cash flow testing and actuarial opinion and memorandum under Section 2010-2 of the Vermont Administrative Code.

Without such permitted statutory accounting practices, the Company’s statutory capital and surplus (deficit) would be $( 594 ) million as of December 31, 2023,

and its risk-based capital would fall below the minimum regulatory requirements.

FGL Insurance’s statutory carrying value of Corbeau Re was $ 171 million at December 31, 2023

FGL NY Insurance - As of December 31, 2023 and 2022, FGL NY Insurance did not follow any prescribed or permitted statutory accounting practices that differ from the NAIC's statutory accounting practices.

Net income and capital and surplus of our wholly owned Bermuda and Cayman Islands regulated insurance subsidiaries under U.S.

GAAP were as follows (in millions):

Subsidiary (country of domicile)

F&G Cayman Re (Cayman Islands) F&G Life Re (Bermuda)

Statutory Net income (loss):

Year ended December 31, 2023

Year ended December 31, 2022

( 299 ) ( 339 )

Year ended December 31, 2021

Statutory Capital and Surplus (Deficit):

December 31, 2023

December 31, 2022

( 126 ) ( 138 )

On August 3, 2021, our Board of Directors approved the 2021 Repurchase Program under which we may purchase up to 25 million shares of our FNF common stock through July 31, 2024, replacing the prior stock repurchase program that expired on July 31, 2021.

1 unchanged sentence

During the year ended December 31, 2023, we repurchased a total of 100,000 FNF common shares for an aggregate of $ 4 million or an average of $ 38.45 per share.

Subsequent to December 31, 2022 and through market close on February 23, 2023, we repurchased a total of 100,000 shares for $ 4 million, or an average of $ 38.45 under this program.

Note Q - Leases

46 unchanged sentences

Option collateral liabilities 588 178

Funds withheld embedded derivative — 73

Other accrued liabilities 387 405

$ 3,009 $ 2,326

The following tables roll forward URL for the years ended December 31, 2023 and December 31, 2022:

Universal Life Total

(In millions)

Balance at January 1, 2023

Capitalization 119 119

Amortization ( 15 ) ( 15 )

Balance at December 31, 2023

Universal Life Total

(In millions)

Balance at January 1, 2022

Capitalization 89 89

Amortization ( 10 ) ( 10 )

Balance at December 31, 2022

For IUL the cash flow assumptions used to amortize URL reflect the company’s best estimates for policyholder behavior.

We review cash flow assumptions annually, generally in the third quarter.

In 2023, F&G undertook a review of all significant assumptions and there were changes to IUL assumptions involving surrender rates and premium persistency.

In 2022, F&G undertook a review of all significant assumptions and there were no changes with a significant impact.

Note T — Income Taxes

Income tax (benefit) expense on continuing operations consists of the following:

Income tax expense (benefit) on continuing operations consists of the following:

Year Ended December 31,

9 unchanged sentences

Net earnings from continuing operations $ 192 $ 439 $ 813

Other comprehensive (loss) earnings:

Unrealized (loss) gain on investments and other financial instruments ( 947 ) ( 141 ) 332

Unrealized (loss) gain on foreign currency translation and cash flow hedging ( 4 ) — 1

Other comprehensive earnings attributable to noncontrolling interest 8 — —

Other comprehensive earnings (loss):

Unrealized gain (loss) on investments and other financial instruments 275 ( 1,198 ) ( 160 )

Unrealized gain (loss) on foreign currency translation and cash flow hedging 2 ( 4 ) —

Changes in current discount rate - future policy benefits ( 50 ) 203 33

Changes in instrument - specific credit risk - market risk benefits ( 9 ) 18 3

F&G 15% Distribution ( 35 ) 9 —

Minimum pension liability adjustment — 2 ( 2 )

Total income tax (benefit) expense allocated to other comprehensive earnings ( 941 ) ( 143 ) 337

Total income taxes $ ( 543 ) $ 570 $ 659

Total income tax expense (benefit) allocated to other comprehensive earnings 183 ( 970 ) ( 126 )

Total income tax expense (benefit) $ 375 $ ( 531 ) $ 687

A reconciliation of the federal statutory rate to our effective tax rate is as follows:

5 unchanged sentences

Tax credits ( 1.8 ) ( 0.7 ) ( 0.2 )

Consolidated partnerships ( 0.2 ) ( 0.1 ) ( 0.3 )

Tax gain on parent shares held ( 1.0 ) 0.5 —

Valuation allowance for deferred tax assets 5.0 5.4 ( 0.4 )

Change in tax status benefit — — ( 2.0 )

Benefit on Capital Loss Carryback — ( 1.3 ) —

Officers Compensation 1.2 0.4 0.2

Non-deductible expenses and other, net 0.1 ( 1.3 ) 1.0

6 unchanged sentences

Derivatives — 67

Accrued liabilities 5 1

Allowance for uncollectible accounts receivable 5 5

Pension plan 1 2

Tax credits 119 74

State income taxes 5 8

Investment securities 686 952

2 unchanged sentences

Funds held under reinsurance agreements 500 37

Market Risk Benefits 61 32

Bermuda corporate income tax net operating loss carryforward 24 —

Total gross deferred tax asset 2,201 1,781

5 unchanged sentences

Other ( 8 ) ( 2 )

Investment securities — ( 401 )

Depreciation ( 29 ) ( 32 )

1 unchanged sentence

Value of business acquired ( 304 ) ( 339 )

Derivatives — ( 68 )

Deferred acquisition costs ( 361 ) ( 209 )

3 unchanged sentences

Total deferred tax liability $ ( 1,661 ) $ ( 1,117 )

Net deferred tax asset (liability) $ 676 $ ( 205 )

Net deferred tax asset $ 343 $ 513

Our net deferred tax asset (liability) was $ 343 million and $ 513 million as of December 31, 2023 and 2022, respectively.

The significant changes in the deferred taxes are as follows:

the deferred tax liability for investment securities decreased by $ 1,353 million primarily due to unrealized losses recorded on investment securities, of which $ 144 million was related to unrealized losses in our Title segment and $ 1,209 million was related to unrealized losses in our F&G segment's life insurance business.

The deferred tax liability relating to partnerships decreased by $ 60 million, primarily due to increased tax basis in partnership investments by F&G and R&E expense capitalization at FNF’s partnerships.

The F&G segment’s life insurance business’ deferred tax liability relating to the VOBA increased by $ 101 million due to unrealized losses on the VOBA assets.

the deferred tax asset for investment securities decreased by $ 266 million primarily due to unrealized losses recorded for investment securities, of which $ 11 million was related to a reduction in unrealized losses in our Title segment and $ 255 million was primarily due to unrealized capital gains on fixed maturities in our F&G segment's life insurance business.

The deferred tax liability related to deferred acquisition costs increased by $ 152 million, which is consistent with the growth in sales in our F&G segment.

The deferred tax liability relating to derivatives in our F&G segment decreased by $ 135 million due to unrealized losses for call options.

The reinsurance receivable deferred tax asset decreased by $ 15 million, and the reinsurance receivable deferred tax liability increased by $ 109 million both due to unrealized losses in the funds withheld portfolios in the F&G segment.

The deferred tax asset relating to the capital loss carryover decreased by $ 33 million which is primarily related to the effective settlement of a capital loss carryback tax benefit previously unrecognized.

The deferred tax asset relating to life insurance receivables decreased by $ 185 million primarily due to tax reserves increasing more than GAAP reserves by F&G.

The reinsurance receivable deferred tax asset increased by $ 463 million, and the reinsurance receivable deferred tax liability increased by $ 434 million both due to Modco reinsurance treatment of GAAP and tax reserves.

The deferred tax asset relating to life insurance receivables increased by $ 114 million primarily due to GAAP reserves for the year increasing by more than the tax reserves for F&G.

As of December 31, 2023, we have net operating losses ("NOLs") on a pretax basis of $ 401 million, of which $ 46 million relates to our Title segment and $ 355 million relates to our F&G segment's life insurance business, which are available to carryforward and offset future federal taxable income.

The NOLs are U.S.

federal NOLs arising from acquisitions made since 2012, including Buyers Protection Group, Inc., Digital Insurance Holdings, Inc., ServiceLink, THL Corporations and F&G.

The Title segment NOLs are U.S.

federal NOLs arising from acquisitions made since 2012, including Buyers Protection Group, Inc., Digital Insurance Holdings, Inc.

and THL Corporations (ServiceLink).

Most of the NOLs are subject to an annual Internal Revenue Code Section 382 limitation.

These losses will begin to expire in 2034 and we fully anticipate utilizing these losses prior to expiration with the exception of $ 25 million of gross net operating losses that are offset by a $ 25 million valuation allowance in the Title segment.

As of December 31, 2022 and 2021, we had $ 74 million and $ 77 million of tax credits, respectively, which expire between 2025 and 2042.

The credits primarily consist of general business credits from historical acquisitions, including $ 30 million associated with our F&G segment's life insurance business.

We anticipate that these credits will be utilized prior to expiration after a valuation allowance of $ 28 million, which primarily relates to the general business credits in our Title segment.

As of December 31, 2022, a valuation allowance on the net deferred tax asset for unrealized capital losses of $ 118 million was recorded, of which $ 88 million related to our Title segment and $ 30 million related to our F&G segment.

Valuation allowance was recorded in 2022 because it is more likely than not that this amount of deferred tax assets will not be realized.

We considered sources of income available as of December 31, 2022 and determined a valuation allowance was needed.

No similar valuation allowance was necessary as of December 31, 2021 as there was a net deferred tax liability for unrealized capital gains.

As of December 31, 2022 and 2021, the balance of unrecognized tax benefits which would, if recognized, favorably affect our effective tax rate was $ 0 million and $ 24 million, respectively.

Interest and penalties accrued on income tax uncertainties are recorded as a component of income tax expense and were $ 0 million and $ 1 million as of December 31, 2022, and 2021, respectively.

Unrecognized tax benefits decreased in 2022 when the refund was examined to a sufficient extent without adjustment such that the tax position was effectively settled.

A reconciliation of the beginning and ending unrecognized tax benefits is as follows:

These losses will begin to expire in year 2034 and we fully anticipate utilizing the Title segment losses prior to expiration with the exception of $ 25 million of gross net operating losses that are offset by a $ 25 million valuation allowance in the Title segment.

The F&G NOLs are primarily indefinite life U.S.

federal NOLs arising from the life insurance business of which $ 68 million are subject to an annual Internal Revenue Code Section 382 limitation.

As of December 31, 2023 and 2022, we had $ 119 million and $ 74 million of tax credits, respectively, some of which have expiration dates and will begin to expire between 2029 and 2043.

The credits primarily consist of general business credits and corporate alternative minimum tax credits, including $ 79 million associated with our F&G segment's life insurance business.

The F&G segment's corporate alternative minimum tax credit has an indefinite life.

We anticipate the remainder of the credits will be utilized prior to expiration with the exception of $ 28 million relating to general business credits in our Title segment which have a corresponding $ 28 million valuation allowance recorded.

As of December 31, 2023, a full valuation allowance on the net deferred tax asset related to the Bermuda corporate income tax net operating loss carryforward of $ 24 million was recorded.

This net change in the valuation allowance of $ 24 million was due to the 2023 enactment of the Bermuda Corporate Income Tax.

As of December 31, 2023, a valuation allowance of $ 139 million on the net deferred tax asset for capital losses was recorded, of which $ 78 million related to our Title segment and $ 61 million related to our F&G segment.

The net change in the capital loss valuation allowance was a $ 20 million increase for the year ended December 31, 2023.

The increase to the valuation allowance was primarily due to a $ 31 million increase in the valuation allowance on unrealized capital losses in the F&G segment's life insurance business, offset by a decrease of $ 11 million in the valuation allowance on unrealized capital losses in the Title segment's bond portfolio.

As of December 31, 2023 and 2022, the balance of unrecognized tax benefits that would, if recognized, favorably affect our effective tax rate was $ 0 million and $ 0 million , respectively.

Interest and penalties accrued on income tax uncertainties are recorded as a component of income tax expense and were $ 0 million and $ 0 million , respectively, as of December 31, 2023, and 2022.

A reconciliation of the beginning and ending unrecognized tax benefits is as follows (in millions):

Year ended December 31,

(In millions)

Beginning balance $ — $ 60

Additions based on positions taken in current year — 1

Reductions related to statute of limitation lapses and audit payments ( 61 ) ( 4 )

Reductions related to IRS accepting refund, statute of limitation lapses and audit payments — ( 61 )

Ending balance $ — $ —

F&G's life insurance subsidiaries, as well as certain F&G non-life subsidiaries file separate tax returns from the FNF consolidated group.

Prepaid expenses and other assets in the accompanying Consolidated Balance Sheets as of December 31, 2022 includes $ 27 million of tax receivables and $ 747 million of deferred tax assets related to F&G subsidiaries who file separate tax returns.

Prepaid expenses and other assets in the accompanying Consolidated Balance Sheets as of December 31, 2021 includes $ 52 million of tax receivables related to F&G subsidiaries who file separate tax returns.

The Internal Revenue Service (“IRS”) has selected us to participate in the CAP program that is a real-time audit.

We are currently under audit by the IRS for the 2021 through 2022 tax years.

Prepaid expenses and other assets in the accompanying Consolidated Balance Sheets as of December 31, 2023, includes:

$ 26 million of tax receivables related to the FNF consolidated group as well as $ 28 million of tax receivables and $ 372 million of deferred tax assets related to F&G subsidiaries who file separate tax returns.

As of December 31, 2022, prepaid expenses and other assets included $ 26 million of tax receivables related to the FNF consolidated group as well as $ 28 million of tax receivables and $ 584 million of deferred tax assets related to the F&G subsidiaries.

We continue to be a participant in the Internal Revenue Service (“IRS”) Compliance Assurance Process that is a real-time audit.

Our 2022 U.S.

federal income tax return is currently under audit by the IRS.

The 2023 U.S.

federal income tax return remains open to examination by the IRS.

We file income tax returns in various foreign and US state jurisdictions.

1 unchanged sentence

The F&G life insurance group files a separate consolidated return with the IRS.

F&G is not currently under examination by the IRS.

The F&G federal income tax returns for 2018 through the current period remain open to examination by the IRS.

The Company considers its non-U.S.

earnings to be indefinitely reinvested outside of the U.S.

to the extent these earnings are not subject to the U.S.

income tax under an anti-deferral tax regime.

Given our intent to reinvest these earnings for an indefinite period of time, the Company has not accrued a deferred tax liability on these earnings.

A determination of an unrecognized deferred tax liability related to these earnings is not practicable.

Note U - Employee Benefit Plans

5 unchanged sentences

FNF 401(k) Profit Sharing Plan

During the three-year period ended December 31, 2022 , we have offered our employees the opportunity to participate in our 401(k) profit sharing plan (the “401(k) Plan”), a qualified voluntary contributory savings plan that is available to

substantially all of our employees.

During the three-year period ended December 31, 2023 , we have offered our employees the opportunity to participate in our 401(k) profit sharing plan (the “401(k) Plan”), a qualified voluntary contributory savings plan that is available to substantially all of our employees.

Eligible employees may contribute up to 40 % of their pre-tax annual compensation, up to the amount allowed pursuant to the Internal Revenue Code.

During the years ended December 31, 2021 and 2020, we made an employer match on the 401(k) Plan of $ 0.375 on each $1.00 contributed up to the first 6 % of eligible earnings contributed to the 401(k) Plan by employees.

During the year ended December 31, 2021, we made an employer match on the 401(k) Plan of $ 0.375 on each $1.00 contributed up to the first 6 % of eligible earnings contributed to the 401(k) Plan by employees.

During the year ended December 31, 2022, we increased the employer match on the 401(k) Plan to $ 0.50 on each $1.00 contributed up to the first 6 % of eligible earnings contributed to the 401(k) Plan by employees.

34 unchanged sentences

Balance January 1, 2021 2,002,690 $ 36.14 1,021,671

Options assumed in connection with F&G acquisition 2,411,585 36.04

Exercised ( 474,754 ) 36.68

Canceled ( 299,736 ) 38.41

Balance, December 31, 2021 1,527,936 $ 35.97 1,072,584

Exercised ( 352,614 ) 38.79

Canceled ( 2,715 ) 28.00

Balance, December 31, 2022 1,172,607 $ 35.15 1,172,607

10 unchanged sentences

Granted 994,548 40.83

Canceled ( 7,577 ) 37.20

Vested ( 792,230 ) 41.44

1 unchanged sentence

Granted 966,093 44.44

Canceled ( 23,975 ) 41.42

Vested ( 908,267 ) 40.26

5 unchanged sentences

Canceled ( 12,437 ) 33.40

Vested ( 29,873 ) 34.59

Balance, December 31, 2021 718,641 $ 40.24

Granted 311,081 48.28

Canceled ( 78,551 ) 37.79

17 unchanged sentences

643,623 $ 7 643,623 $ 7

770,078 2.62 39.10 — 770,078 2.62 39.10 —

1,172,607 $ 4 1,172,607 $ 4

We account for stock-based compensation plans in accordance with GAAP on share-based payments, which requires that compensation cost relating to share-based payments be recognized in the consolidated financial statements based on the fair value of each award.

18 unchanged sentences

The net pension liability and net periodic expense included in our financial position and results of operations relating to the Pension Plan is not considered material for any period presented.

On May 1, 2023, we elected to terminate the Pension Plan, subject to approval by the Pension Benefit Guarantee Corporation and the receipt of a favorable determination letter from the Internal Revenue Service.

Upon termination, the account balance of each participant in the Pension Plan shall become fully vested.

Each remaining participant or beneficiary in the Pension Plan shall be given one of the following options with respect to termination of the Pension Plan:

(i) a lump-sum distribution of the participant's account balance;

or (ii) an annuity benefit equal to the participant’s account balance.

Note V - Financial Instruments with Off-Balance Sheet Risk and Concentration of Risk

15 unchanged sentences

Adopted Pronouncements

In June 2016, the FASB issued ASU No.

2016-13 Financial Instruments - Credit Losses:

Measurement of Credit Losses on Financial Instruments (Topic 326).

The amendments in this ASU introduce broad changes to accounting for credit impairment of financial instruments.

The primary updates include the introduction of a new current expected credit loss ("CECL") model that is based on expected rather than incurred losses and amendments to the accounting for impairment of fixed maturity securities available for sale.

The method used to measure estimated credit losses for fixed maturity available-for-sale securities will be unchanged from current GAAP;

however, the amendments require credit losses to be recognized through an allowance rather than as a reduction to the amortized cost of those securities.

We adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost.

Results for reporting period beginning after December 15, 2019 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable Generally Accepted Accounting Principles.

We adopted this standard using the prospective transition approach for debt securities for which other than temporary impairment had been recognized prior to January 1, 2020.

As a result, the amortized cost basis remains the same before and after the effective date of ASC 326.

The effective interest rate on these debt securities was not changed.

Amounts previously recognized in accumulated other comprehensive income as of January 1, 2020 relating to improvements in cash flows expected to be collected will be accreted into income over the remaining life of the asset.

Recoveries of amounts previously written off relating to improvements in cash flows after January 1, 2020 will be recorded in earnings when received .

See Note E Investments for further discussion of the adoption as it relates to our fixed maturity securities available for sale.

In December 2019, the FASB issued ASU 2019-12 Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740), which simplifies various aspects of the income tax accounting guidance and will be applied using different approaches depending on what the specific amendment relates to and, for public entities, are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020.

We adopted this standard as of January 1, 2021, and it had no impact on our Consolidated Financial Statements upon adoption.

In October 2020, the FASB issued ASU 2020-08, Codification Improvements to Subtopic 310-20, Receivables - Nonrefundable Fees and Other Costs.

The amendments in this update clarify that callable debt securities should be re-evaluated each reporting period to determine if the amortized cost exceeds the amount repayable by the issuer at the next earliest call date, and, if so, the excess should be amortized to the next call date.

We adopted this standard as of January 1, 2021 and are applying this guidance on a prospective basis.

This standard had no impact on our Consolidated Financial Statements upon adoption.

Pronouncements Not Yet Adopted

In August 2018, the FASB issued ASU 2018-12, Financial Services-Insurance (Topic 944), Targeted Improvements to the Accounting for Long-Duration Contracts, as clarified and amended by ASU 2019-09, Financial Services-Insurance:

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-12, as clarified and amended by ASU 2019-09, Financial Services-Insurance:

Effective Date and ASU 2020-11, Financial Services-Insurance:

1 unchanged sentence

This update introduced the following requirements:

assumptions used to measure cash flows for traditional and limited-payment contracts must be reviewed at least annually with the effect of changes in those assumptions being recognized in the statement of operations;

the discount rate applied to measure the liability for future policy benefits and limited-payment contracts must be updated at each reporting date with the effect of changes in the rate being recognized in other comprehensive income (“OCI”);

market risk benefits ("MRBs") associated with deposit contracts must be measured at fair value, with the effect of the change in the fair value recognized in earnings, except for the change attributable to instrument-specific credit risk which is recognized in OCI;

Market risk benefits (“MRB”) associated with deposit contracts must be measured at fair value, with the effect of the change in the fair value recognized in earnings, except for the change attributable to instrument-specific credit risk, which is recognized in AOCI;

deferred acquisition costs are no longer required to be amortized in proportion to premiums, gross profits, or gross margins;

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deferred acquisition costs must be written off for unexpected contract terminations;

and disaggregated rollforwards of beginning to ending balances of the liability for future policy benefits, policyholder account balances, MRBs, separate account liabilities and deferred acquisition costs, as well as information about significant inputs, judgments, assumptions, and methods used in measurement are required to be disclosed.

The amendments in this ASU may be early adopted as of the beginning of an annual reporting period for which financial statements have not yet been issued, including interim financial statements.

We have identified specific areas that will be impacted by the new guidance.

This guidance will bring significant changes to how we account for certain insurance and annuity products within our business and expand disclosures.

As part of the implementation process, to date our progress includes, but is not limited to the following:

identifying and documenting contracts and contract features in scope of the guidance;

identifying actuarial models, systems, and processes to be updated;

building and running models;

generating and analyzing preliminary output;

evaluating and finalizing key accounting policies;

evaluating transition requirements and impacts;

and establishing, documenting, and executing appropriate internal controls.

We will not early adopt this standard and have selected the full retrospective transition method, which requires the new guidance be applied as of the beginning of the earliest period presented or January 1, 2021, referred to as the transition date.

Adoption of this standard is expected to increase total stockholders’ equity as of the transition date, January 1, 2021, up to approximately $ 200 million, net of tax.

This transition adjustment is expected to primarily increase Retained Earnings, as well as OCI.

The most significant driver of this transition adjustment expected to increase Retained Earnings is the measurement of certain benefits historically recorded as insurance liabilities which will now be classified and measured as MRBs, along with their subsequent changes in fair value, excluding changes attributable to instrument-specific credit risk, which are recorded as a component of OCI.

The most significant drivers of this transition adjustment expected to increase OCI are the reversal of intangible balances previously recorded as an adjustment to unrealized gains (losses) on available for sale securities, the remeasurement of the liability for future policyholder benefits using a discount rate assumption that reflects upper-medium grade fixed-income instruments, and the effect of changes in the fair value of MRBs attributable to changes in the instrument-specific credit risk.

As of December 31, 2022, the Company continues to expect the measurement drivers above, in relation to the current market conditions, to support a favorable impact to total stockholders’ equity at or greater than the transition impact, contingent upon the completion of our ongoing implementation process.

Further, the specific impacts on Retained Earnings and OCI upon adoption of this standard on January 1, 2023 may also differ materially from the transition impact based on the performance of the Company’s business and macroeconomic conditions, including changes in interest rates.

and disaggregated roll forwards of beginning to ending balances of the liability for future policyholder benefits ("FPBs"), contractholder funds, MRBs, separate account liabilities and deferred acquisition costs, as well as information about significant inputs, judgments, assumptions, and methods used in measurement are required to be disclosed.

We adopted this standard, which required the new guidance be applied as of the beginning of the earliest period presented or January 1, 2021, referred to as the transition date, and elected the full retrospective transition method.

As a result of adoption, the Company recorded a cumulative-effect adjustment, which increased opening 2021 retained earnings by $ 75 million, net of tax.

The following table summarizes the balance of and changes in the FPB on January 1, 2021, due to adoption of ASU 2018-12 :

Immediate annuities Traditional Life Total (3)

Balance, December 31, 2020 $ 1,861 $ 2,144 $ 4,005

Cumulative effect of retrospective adoption (1) 201 ( 279 ) ( 78 )

Effect of remeasurement of liability at current discount rate (2) 113 88 201

Balance, January 1, 2021 $ 2,175 $ 1,953 $ 4,128

Reinsurance Recoverable 322 793 1,115

Balance, January 1, 2021, net of reinsurance $ 1,853 $ 1,160 $ 3,013

(1) Adjustments for the cumulative effect of adoption of the new measurement guidance under the full retrospective method for contract issue years from the FNF Acquisition Date through December 31, 2020, net of the effects of any change in the DPL.

(2) The remeasurement of the liability at the current discount rate is reflected as an adjustment to opening AOCI upon the adoption of ASU 2018-12.

(3) PRT was not written as of the transition date, January 1, 2021, and as a result is not presented in the transition adjustment roll forward.

The following table summarizes the balance of and changes in VOBA on January 1, 2021 due to adoption of ASU 2018-12 (in millions):

FIA Fixed rate annuities Immediate annuities Universal Life Traditional Life Total

Balance, December 31, 2020 $ 1,208 $ 15 $ 86 $ 139 $ 18 $ 1,466

Adjustment for reversal of AOCI adjustments (1) 208 24 — 29 ( 29 ) 232

Cumulative effect of retrospective adoption (2) ( 14 ) 7 ( 5 ) ( 9 ) ( 1 ) ( 22 )

Transition opening balance adjustment (3) 69 2 145 5 43 264

Balance, January 1, 2021 $ 1,471 $ 48 $ 226 $ 164 $ 31 $ 1,940

(1) Prior period "shadow" adjustments in AOCI have been reversed upon the adoption of ASU 2018-12 from opening AOCI.

(2) Adjustments for the cumulative effect of adoption of the simplified amortization methodology under the full retrospective method from the FNF Acquisition Date through December 31, 2020.

(3) Adjustments for the change in VOBA due to the full retrospective adjustment of carrying amounts of acquired contracts as of the FNF Acquisition Date due to the adoption of ASU 2018-12.

The following table summarizes the balance of and changes in DAC on January 1, 2021, due to adoption of ASU 2018-12 (in millions):

FIA Fixed rate annuities Universal Life Total

Balance, December 31, 2020 $ 167 $ 14 $ 41 $ 222

Adjustment for reversal of AOCI adjustments (1) 15 2 8 25

Cumulative effect of retrospective adoption (2) ( 1 ) — ( 1 ) ( 2 )

Balance, January 1, 2021 $ 181 $ 16 $ 48 $ 245

(1) Prior period "shadow" adjustments in AOCI have been reversed upon the adoption of ASU 2018-12 from opening AOCI.

(2) Adjustments for the cumulative effect of adoption of the simplified amortization methodology under the full retrospective method for contract issue years from the FNF Acquisition Date through December 31, 2020.

The following table summarizes the balance of and changes in DSI on January 1, 2021, due to adoption of ASU 2018-12 (in millions):

Balance, December 31, 2020 $ 36 $ 36

Adjustment for reversal of AOCI adjustments (1) 5 5

Cumulative effect of retrospective adoption (2) 4 4

Balance, January 1, 2021 $ 45 $ 45

(1) Prior period "shadow" adjustments in AOCI have been reversed upon the adoption of ASU 2018-12 from opening AOCI.

The following table summarizes the balance of and changes in URL on January 1, 2021, due to adoption of ASU 2018-12 :

Universal Life Total

Balance, December 31, 2020 $ 2 $ 2

Adjustment for reversal of AOCI adjustments (1) 25 25

Cumulative effect of retrospective adoption (2) 2 2

Balance, January 1, 2021 $ 29 $ 29

(1) Prior period "shadow" adjustments in AOCI have been reversed upon the adoption of ASU 2018-12 from opening AOCI.

The following table summarizes the balance of and changes in the asset and liability position of MRBs on January 1, 2021, due to adoption of ASU 2018-12:

FIA Fixed rate annuities Total

Balance, December 31, 2020 - Carrying amount of MRBs under prior guidance (1) $ 531 $ — $ 531

Adjustment for reversal of AOCI adjustments (2) ( 116 ) — ( 116 )

Cumulative effect of the changes in the instrument-specific credit risk between the original contract issuance date and the transition date (3) 159 — 159

Remaining cumulative difference (exclusive of the instrument specific credit risk change) between December 31, 2020 carrying amount and fair value measurement for the MRBs (4) ( 96 ) 1 ( 95 )

Balance, January 1, 2021 - Market risk benefits at fair value $ 478 $ 1 $ 479

Reinsurance Recoverable — — —

Balance, January 1, 2021, net of reinsurance $ 478 $ 1 $ 479

(1) The pre-adoption balance as of December 31, 2020 balance for MRBs represents the contract features that meet the definition of an MRB under ASU 2018-12 and the related carrying amount of those features prior to the ASU.

Those contract features were previously accounted for at fair value as a derivative or embedded derivative under ASC 815 or as an additional liability for annuitization benefits or death or other insurance benefits under ASC 944.

(2) Prior period "shadow" adjustments in AOCI have been reversed upon the adoption of ASU 2018-12 from opening AOCI.

(3) The cumulative effective of the change in instrument-specific credit risk between the FNF Acquisition Date or, if later, the original contract issuance date and the transition date to ASU 2018-12, which is recorded as an adjustment to opening AOCI.

(4) The cumulative difference (exclusive of instrument-specific credit risk change) between the pre-adoption carrying amount and the fair value measurement for MRBs is recorded as an adjustment to opening retained earnings.

The following table presents the effect of transition adjustments on Equity on January 1, 2021 due to the adoption of ASU 2018-12 (in millions):

January 1, 2021

Retained Earnings AOCI

Contractholder funds $ 101 $ 115

MRB 30 ( 160 )

FPB ( 14 ) ( 159 )

VOBA ( 21 ) 233

Increase to Equity, gross of tax $ 95 $ 34

Tax impact 20 9

Increase to Equity, net of tax $ 75 $ 25

For MRBs, the transition adjustment reflected within the Consolidated Statements of Comprehensive Earnings relates to the cumulative effect of changes in the instrument-specific credit risk between contract issue date and transition date.

The remaining difference between the fair value and carrying amount of the MRBs at transition, excluding the amounts recorded in the Consolidated Statements of Comprehensive Earnings, was recorded as an adjustment to Retained Earnings as of the transition date.

For the FPB, the net transition adjustment is primarily related to the difference in the discount rate used pre-transition and the discount rate at January 1, 2021, partially offset by the removal of provisions for adverse deviation from the cash flow assumptions used in the FPB calculation.

At transition, we did not identify any instances, at the cohort level, where net premiums exceeded gross premiums.

Before the adoption of ASU 2018-12, VOBA was amortized consistent with DAC, which was amortized over the lives of the policies in relation to the expected emergence of estimated gross profits (“EGPs”).

Based on our historical practice of using consistent amortization methods for VOBA and DAC, we elected to change the amortization method for VOBA associated with fixed rate annuities, FIAs, and IUL/Universal Life (“UL”) products to maintain consistency with the amortization method for DAC.

At transition, VOBA associated with these product types is amortized on a constant level basis for the grouped contracts over the expected term of the related contracts to approximate straight-line amortization.

Additionally, at transition, shadow adjustments previously recorded in the Consolidated Statements of Comprehensive Earnings, consistent with the historic amortization of DAC, have been removed.

For DAC, DSI and URL, we removed shadow adjustments previously recorded in the Consolidated Statements of Comprehensive Earnings for the impact of unrealized gains and losses that were included in the pre-transition expected gross profits amortization calculation as of the transition date.

In March 2022, the FASB issued ASU 2022-02, Financial Instruments-Credit Losses (Topic 326):

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Measurement of Credit Losses on Financial Instruments (Topic 326) for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, though early adoption is permitted.

We do not expect this guidance to have a material impact on our Consolidated Financial Statements and related disclosures upon adoption.

We do not currently plan to early adopt this standard.

We adopted this standard as of January 1, 2023, and it did not have a material impact on our Consolidated Financial Statements and related disclosures upon adoption.

Pronouncements Not Yet Adopted

In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions.

The amendments in this update affect all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction and clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not

considered in measuring fair value.

The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction.

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the fair value of equity securities subject to contractual sale restrictions reflected in the balance sheet, the nature and remaining duration of the restriction(s), and the circumstances that could cause a lapse in the restriction(s).

The amendments in this update do not change the principles of fair value measurement, rather, they clarify those principles when measuring the fair value of an equity security subject to a contractual sale restriction and improve current GAAP by reducing diversity in practice, reducing the cost and complexity in measuring fair value, and increasing comparability of financial information across reporting entities that hold those investments.

The amendments in this update do not change the principles of fair value measurement, rather, they clarify those

principles when measuring the fair value of an equity security subject to a contractual sale restriction and improve current GAAP by reducing diversity in practice, reducing the cost and complexity in measuring fair value, and increasing comparability of financial information across reporting entities that hold those investments.

The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years, though early adoption is permitted.

We do not currently expect to early adopt this standard and are in the process of assessing this standard and its impact on our accounting and disclosures.

Note X — Net Income Attributable to FNF Common Shareholders and Change in Total Equity

On December 1, 2022, we completed the F&G Distribution.

For further information related to the F&G Distribution, refer to Note A Business and Summary of Significant Accounting Policies .

On July 29, 2020, we purchased for $ 90 million the outstanding Class A units of ServiceLink held by its minority owners.

As of the purchase date, ServiceLink is a wholly owned subsidiary of FNF.

For further information related to the purchase of the outstanding Class A units of ServiceLink held by its minority owners, refer to Note A Business and Summary of Significant Accounting Policies .

The following table presents the effect of the change in our ownership percentage in F&G and ServiceLink on equity attributable to FNF:

Year ended December 31,

We do not expect this guidance to have a material impact on our Consolidated Financial Statements and related disclosures upon adoption.

We do not currently plan to early adopt this standard.

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

Improvements to Reportable Segment Disclosures.

The amendments in this update improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expense categories that are regularly provided to the chief operating decision maker (CODM) and included in each reported measure of a segment’s profit or loss.

In addition, the amendments enhance interim disclosure requirements that are currently required annually, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, and contain other disclosure requirements.

The amendments in this update are incremental to the current requirements of Topic 280 and do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments.

The enhanced segment disclosure requirements apply retrospectively to all prior periods presented in the financial statements.

The significant segment expense and other segment item amounts disclosed in prior periods shall be based on the significant segment expense categories identified and disclosed in the period of adoption.

The amendments in this update are effective for all public entities for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024.

Early adoption is permitted , and the updates must be applied retrospectively to all periods presented in the financial statements .

We do not currently expect to early adopt this standard and are in the process of assessing its impact on our disclosures upon adoption.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

The amendments in this update enhance the transparency of the income tax disclosures by expanding on the disclosures required annually.

The amendments require entities to disclose in their rate reconciliation table additional categories of information about federal, state, and foreign income taxes, in addition to providing details about the reconciling items in some categories if above a quantitative threshold.

Additionally, the amendments require annual disclosure of income taxes paid (net of refunds received) disaggregated by jurisdiction based on a quantitative threshold.

The amendments in this update are effective for public business entities for annual periods beginning after December 15, 2024.

Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance.

The amendments should be applied on a prospective basis, and retrospective application is permitted.

We do not currently expect to early adopt this standard and are in the process of assessing its impact on our disclosures upon adoption.

Note X - Market Risk Benefits

The following table presents the balances of and changes in MRBs associated with FIAs and fixed rate annuities for the years ended December 31, 2023, December 31, 2022, and December 31, 2021:

December 31, 2023 December 31, 2022 December 31, 2021

FIA Fixed rate annuities FIA Fixed rate annuities FIA Fixed rate annuities

(Dollars in millions)

Balance, beginning of period, net liability $ 164 $ 1 $ 426 $ 2 $ 478 $ 1

Balance, beginning of period, before effect of changes in the instrument-specific credit risk $ 102 $ 1 $ 280 $ 1 $ 320 $ 1

Issuances and benefit payments ( 10 ) — ( 21 ) — ( 9 ) —

Attributed fees collected and interest accrual 131 — 107 1 99 1

Actual policyholder behavior different from expected 27 — 43 — ( 22 ) —

Changes in assumptions and other 29 — ( 76 ) — — —

Effects of market related movements ( 70 ) — ( 231 ) ( 1 ) ( 108 ) ( 1 )

Balance, end of period, before effect of changes in the instrument-specific credit risk $ 209 $ 1 $ 102 $ 1 $ 280 $ 1

Effect of changes in the instrument-specific credit risk 105 — 62 — 146 1

Balance, end of period, net liability $ 314 $ 1 $ 164 $ 1 $ 426 $ 2

Weighted-average attained age of policyholders weighted by total AV (years) 68.28 72.59 68.59 72.88 68.95 73.10

Net amount at risk $ 1,059 $ 2 $ 952 $ 3 $ 1,304 $ 4

The following table reconciles MRBs by amounts in an asset position and amounts in a liability position to the MRBs amounts in the Consolidated Balance Sheets:

December 31, 2023 December 31, 2022 December 31, 2021

Asset Liability Net Asset Liability Net Asset Liability Net

(In millions)

FIA 88 402 314 117 281 164 41 467 426

Fixed rate annuities — 1 1 — 1 1 — 2 2

Total $ 88 $ 403 $ 315 $ 117 $ 282 $ 165 $ 41 $ 469 $ 428

The net MRB liability increased for the year ended December 31, 2023, primarily as a result of attributed fees collected, increases as a result of actual policyholder behavior different than expected and changes in assumptions and other as discussed below.

These increases were partially offset by the effects of market related movements, including the impacts of higher risk-free rates and increases in the equity market related projections.

For the year ended December 31, 2023, notable changes made to the inputs to the fair value estimates of MRBs calculations included a significant increase in risk-free rates leading to a favorable change in the MRBs associated with FIA and fixed rate annuities;

increases in the equity market related projections resulted in a decrease in the net amount at risk associated with FIAs, lead to a favorable change in the value of the associated MRBs;

and F&G’s credit spread decreased, leading to a corresponding unfavorable change in the MRBs associated with both FIA and fixed rate annuities.

In addition, the cash flow assumptions used to calculate MRBs reflect the company’s best estimates for policyholder behavior.

We review cash flow assumptions annually, generally in the third quarter.

In 2023, F&G undertook a review of all significant assumptions and revised several assumptions relating to our deferred annuities (FIA and fixed rate annuities) with MRBs including surrender rates, partial withdrawal rates, mortality improvement, and option budgets.

All updates to these assumptions brought us more in line with our Company and overall industry experience since the prior assumption update.

These updates, in total, led to an unfavorable change in the MRB balance during the third quarter of 2023.

Additionally, in the fourth quarter of 2023, an update to the industry future mortality improvement table led to a corresponding update in our future mortality improvement assumption, which led to an unfavorable change in the MRB balance during the fourth quarter of 2023.

The net MRB liability decreased for the year ended December 31, 2022, primarily as a result of the effects of market related movements, including the impact of higher risk-free rates, and changes in assumptions and other as discussed below, partially offset by attributed fees collected and increases as a result of actual policyholder behavior different than expected.

For the year ended December 31, 2022, notable changes made to the inputs to the fair value estimates of MRBs calculations included a significant increase to risk-free rates leading to a favorable change in the MRBs associated with both FIA and fixed rate annuities;

decreases in the equity markets resulting in an increase in the net amount at risk associated with FIAs, leading to an unfavorable change in the value of the associated MRBs;

and volatility indices increased, leading to an unfavorable change in the MRBs associated with FIAs.

Cash flow assumptions for mortality and full and partial surrenders were unchanged during the annual third quarter review in 2022.

The GMWB utilization assumption was revised in the second quarter of 2022 to reflect additional internal and industry experience for the first several contract years.

This assumption update led to a decrease in the net MRB liability.

In addition, F&G’s credit spread increased during 2022, leading to a corresponding decrease in the net MRB liability.

Credit spreads on the block of business remain lower than the at-issue or at-purchase credit spreads, but the level has decreased since the beginning of 2022.

The net MRB liability decreased for the year ended December 31, 2021, primarily as a result of the effects of market related movements, including the impact of higher risk-free rates, and decreases as a result of actual policyholder behavior different than expected, partially offset by attributed fees collected.

For the year ended December 31, 2021, notable changes made to the inputs to the fair value estimates of MRBs calculations included a moderate increase to risk-free rates leading to a favorable change in the MRBs associated with both FIA and fixed rate annuities and increases in the equity markets resulting in a decrease in the net amount at risk associated with FIAs, leading to a favorable change in the value of the associated MRBs.

Note Y — Contractholder Funds

The following tables summarize balances of and changes in contractholder funds’ account balances:

December 31, 2023

FIA Fixed rate annuities Universal Life FABN (b) FHLB (b)

(Dollars in millions)

Balance, beginning of year $ 24,766 $ 9,358 $ 2,112 $ 2,613 $ 1,982

Issuances 4,722 5,061 199 — 1,256

Premiums received 103 1 382 — —

Policy charges (a) ( 182 ) — ( 261 ) — —

Surrenders and withdrawals ( 2,005 ) ( 1,142 ) ( 90 ) — —

Benefit payments ( 526 ) ( 240 ) ( 27 ) ( 53 ) ( 763 )

Interest credited 270 405 76 54 64

Other 16 — — ( 1 ) —

Balance, end of year $ 27,164 $ 13,443 $ 2,391 $ 2,613 $ 2,539

Embedded derivative adjustment (c) 243 — 84 — —

Gross Liability, end of period $ 27,407 $ 13,443 $ 2,475 $ 2,613 $ 2,539

Reinsurance ( 17 ) ( 7,520 ) ( 894 ) — —

Net Liability, after Reinsurance $ 27,390 $ 5,923 $ 1,581 $ 2,613 $ 2,539

Weighted-average crediting rate 1.40 % 4.85 % 3.44 % N/A N/A

Net amount at risk (d) N/A N/A $ 60,389 N/A N/A

Cash surrender value (e) $ 25,099 $ 12,505 $ 1,872 N/A N/A

(a) Contracts included in the contractholder funds are generally charged a premium and/or monthly assessments on the basis of the account balance.

(b) FABN and FHLB are considered funding agreements that are investment contracts which follow the interest method of accounting, and therefore are not subject to ASU 2018-12 disclosure requirements.

However, the Company has elected to present the liability for these agreements within the disaggregated roll forward as we believe it will provide meaningful information for users of the financials.

(c) The embedded derivative adjustment reconciles the account balance to the gross GAAP liability and represents the combination of the host contract and the fair value of the embedded derivatives.

(d) For those guarantees of benefits that are payable in the event of death, the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date.

(e) These amounts are gross of reinsurance

December 31, 2022

FIA Fixed rate annuities Universal Life FABN (b) FHLB (b)

(Dollars in millions)

Balance, beginning of year $ 21,997 $ 6,367 $ 1,907 $ 1,904 $ 1,543

Issuances 4,462 3,758 167 700 1,192

Premiums received 106 3 295 — —

Policy charges (a) ( 166 ) ( 1 ) ( 209 ) — —

Surrenders and withdrawals ( 1,322 ) ( 797 ) ( 74 ) — —

Benefit payments ( 485 ) ( 192 ) ( 22 ) ( 35 ) ( 789 )

Interest credited 198 220 48 45 36

Other ( 24 ) — — ( 1 ) —

Balance, end of year $ 24,766 $ 9,358 $ 2,112 $ 2,613 $ 1,982

Embedded derivative adjustment (c) ( 343 ) — 15 — —

Gross Liability, end of period $ 24,423 $ 9,358 $ 2,127 $ 2,613 $ 1,982

Reinsurance ( 17 ) ( 3,723 ) ( 947 ) — —

Net Liability, after Reinsurance $ 24,406 $ 5,635 $ 1,180 $ 2,613 $ 1,982

Weighted-average crediting rate 0.85 % 2.84 % 2.39 % N/A N/A

Net amount at risk (d) N/A N/A $ 53,348 N/A N/A

Cash surrender value (e) $ 23,049 $ 8,744 $ 1,698 N/A N/A

(a) Contracts included in the contractholder funds are generally charged a premium and/or monthly assessments on the basis of the account balance.

(b) FABN and FHLB are considered funding agreements that are investment contracts which follow the interest method of accounting, and therefore are not subject to ASU 2018-12 disclosure requirements.

However, the Company has elected to present the liability for these agreements within the disaggregated roll forward as we believe it will provide meaningful information for users of the financials.

(c) The embedded derivative adjustment reconciles the account balance to the gross GAAP liability and represents the combination of the host contract and the fair value of the embedded derivatives.

(e) These amounts are gross of reinsurance

December 31, 2021

FIA Fixed rate annuities Universal Life FABN (b) FHLB (b)

(Dollars in millions)

Balance, beginning of year $ 18,703 $ 5,142 $ 1,696 $ — $ 1,203

Issuances 4,400 1,743 114 1,899 759

Premiums received 103 3 233 — —

Policy charges (a) ( 148 ) ( 1 ) ( 167 ) — —

Surrenders and withdrawals ( 1,303 ) ( 543 ) ( 68 ) — —

Benefit payments ( 440 ) ( 145 ) ( 19 ) ( 7 ) ( 447 )

Interest credited 686 167 118 12 30

Other ( 4 ) 1 — — ( 2 )

Balance, end of year $ 21,997 $ 6,367 $ 1,907 $ 1,904 $ 1,543

Embedded derivative adjustment (c) 603 — 74 — —

Gross Liability, end of period $ 22,600 $ 6,367 $ 1,981 $ 1,904 $ 1,543

Reinsurance ( 17 ) ( 1,692 ) ( 984 ) — —

Net Liability, after Reinsurance $ 22,583 $ 4,675 $ 997 $ 1,904 $ 1,543

Weighted-average crediting rate 3.43 % 2.94 % 6.77 % N/A N/A

Net amount at risk (d) N/A N/A $ 41,326 N/A N/A

Cash surrender value (e) $ 20,455 $ 5,992 $ 1,572 N/A N/A

(a) Contracts included in the contractholder funds are generally charged a premium and/or monthly assessments on the basis of the account balance.

(b) FABN and FHLB are considered funding agreements that are investment contracts which follow the interest method of accounting, and therefore are not subject to ASU 2018-12 disclosure requirements.

However, the Company has elected to present the liability for these agreements within the disaggregated roll forward as we believe it will provide meaningful information for users of the financials.

(c) The embedded derivative adjustment reconciles the account balance to the gross GAAP liability and represents the combination of the host contract and the fair value of the embedded derivatives.

(e) These amounts are gross of reinsurance

The following table reconciles contractholder funds’ account balances to the contractholder funds liability in the Consolidated Balance Sheets:

December 31, 2023 December 31, 2022 December 31, 2021

(In millions)

FIA $ 27,407 $ 24,423 $ 22,600

Fixed rate annuities 13,443 9,358 6,367

Immediate annuities 311 332 352

Universal life 2,475 2,127 1,981

Traditional life 5 5 5

Funding Agreement-FABN 2,613 2,613 1,904

FHLB 2,539 1,982 1,543

Total $ 48,798 $ 40,843 $ 34,753

Annually, typically in the third quarter, we review assumptions associated with reserves for policy benefits and product guarantees.

During the third quarter of 2023 and for the year ended December 31, 2023, based on increases in interest rates and pricing changes, we updated certain FIA assumptions used to calculate the fair value of the embedded derivative component within contractholder funds and also aligned reserves to actual policyholder behavior.

These changes resulted in an increase in total benefits and other changes in policy reserves of approximately $ 73 million for the year ended December 31, 2023.

The following tables present the account values by range of guaranteed minimum crediting rates and the related range of difference, in basis points, between rates being credited to policyholders and the respective guaranteed minimums:

December 31, 2023

Range of guaranteed minimum crediting rate At Guaranteed Minimum 1 Basis Point- 50 Basis Points Above

51 Basis Points- 150 Basis Points Above

Greater Than 150 Basis Points Above

FIA (In millions)

0.00%-1.50% $ 22,392 $ 1,444 $ 526 $ 1,953 $ 26,315

1.51%-2.50% 196 1 24 250 471

Greater than 2.50% 377 1 — — 378

Total $ 22,965 $ 1,446 $ 550 $ 2,203 $ 27,164

Fixed Rate Annuities

0.00%-1.50% $ 23 $ 25 $ 1,532 $ 10,271 $ 11,851

1.51%-2.50% 5 8 23 453 489

Greater than 2.50% 893 2 4 204 1,103

Total $ 921 $ 35 $ 1,559 $ 10,928 $ 13,443

Universal Life

0.00%-1.50% $ 1,987 $ 5 $ — $ 21 $ 2,013

1.51%-2.50% — — — — —

Greater than 2.50% 361 16 1 — 378

Total $ 2,348 $ 21 $ 1 $ 21 $ 2,391

December 31, 2022

Range of guaranteed minimum crediting rate At Guaranteed Minimum 1 Basis Point- 50 Basis Points Above

51 Basis Points- 150 Basis Points Above

Greater Than 150 Basis Points Above

FIA (In millions)

0.00%-1.50% $ 22,848 $ 801 $ 410 $ 151 $ 24,210

1.51%-2.50% 162 — 1 — 163

Greater than 2.50% 390 — 3 — 393

Total $ 23,400 $ 801 $ 414 $ 151 $ 24,766

Fixed Rate Annuities

0.00%-1.50% $ 10 $ 32 $ 1,871 $ 6,379 $ 8,292

1.51%-2.50% 9 14 30 1 54

Greater than 2.50% 997 4 4 7 1,012

Total $ 1,016 $ 50 $ 1,905 $ 6,387 $ 9,358

Universal Life

0.00%-1.50% $ 1,701 $ 3 $ — $ 17 $ 1,721

1.51%-2.50% — — — — —

Greater than 2.50% 346 44 1 — 391

Total $ 2,047 $ 47 $ 1 $ 17 $ 2,112

December 31, 2021

Range of guaranteed minimum crediting rate At Guaranteed Minimum 1 Basis Point- 50 Basis Points Above

51 Basis Points- 150 Basis Points Above

Greater Than 150 Basis Points Above

FIA (In millions)

0.00%-1.50% $ 20,162 $ 803 $ 388 $ — $ 21,353

1.51%-2.50% 171 11 25 — 207

Greater than 2.50% 431 3 3 — 437

Total $ 20,764 $ 817 $ 416 $ — $ 21,997

Fixed Rate Annuities

0.00%-1.50% $ 2 $ 28 $ 1,928 $ 3,219 $ 5,177

1.51%-2.50% 9 15 37 1 62

Greater than 2.50% 954 142 25 7 1,128

Total $ 965 $ 185 $ 1,990 $ 3,227 $ 6,367

Universal Life

0.00%-1.50% $ 1,486 $ 2 $ — $ 13 $ 1,501

1.51%-2.50% — — — — —

Greater than 2.50% 359 46 1 — 406

Total $ 1,845 $ 48 $ 1 $ 13 $ 1,907

Note Z — Future Policy Benefits

The following table summarizes balances and changes in the present value of expected net premiums and the present value of the expected FPB for nonparticipating traditional contracts:

December 31, 2023 December 31, 2022 December 31, 2021

Expected net premiums (Dollars in millions)

Balance, beginning of year $ 797 $ 1,020 $ 1,152

Beginning balance at original discount rate 974 1,045 1,131

Effect of actual variances from expected experience ( 1 ) 33 25

Balance adjusted for variances from expectation $ 973 $ 1,078 $ 1,156

Interest accrual 19 20 22

Net premiums collected ( 118 ) ( 124 ) ( 133 )

Ending Balance at original discount rate $ 874 $ 974 $ 1,045

Effect of changes in discount rate assumptions ( 152 ) ( 177 ) ( 25 )

Balance, end of year $ 722 $ 797 $ 1,020

Balance, beginning of year $ 2,151 $ 2,772 $ 3,105

Beginning balance at original discount rate 2,665 2,806 2,995

Effect of actual variances from expected experience ( 24 ) 13 ( 14 )

Balance adjusted for variances from expectation $ 2,641 $ 2,819 $ 2,981

Interest accrual 56 59 62

Benefits payments ( 205 ) ( 213 ) ( 237 )

Ending Balance at original discount rate $ 2,492 $ 2,665 $ 2,806

Effect of changes in discount rate assumptions ( 421 ) ( 514 ) ( 34 )

Balance, end of year $ 2,071 $ 2,151 $ 2,772

Net liability for future policy benefits $ 1,349 $ 1,354 $ 1,752

Reinsurance recoverable 413 612 749

Net liability for future policy benefits, after reinsurance recoverable $ 936 $ 742 $ 1,003

Weighted-average duration of liability for future policyholder benefits (years) 7.36 7.58 8.54

The following tables summarize balances and changes in the present value of the expected FPB for limited-payment contracts:

December 31, 2023 December 31, 2022 December 31, 2021

Balance, beginning of year $ 2,165 $ 1,148 $ —

Beginning balance at original discount rate 2,475 1,151 —

Effect of changes in cash flow assumptions ( 9 ) ( 20 ) —

Effect of actual variances from expected experience ( 7 ) 2 —

Balance adjusted for variances from expectation $ 2,459 $ 1,133 $ —

Issuances 2,041 1,418 1,155

Interest accrual 109 50 2

Benefits payments ( 258 ) ( 126 ) ( 6 )

Ending Balance at original discount rate $ 4,351 $ 2,475 $ 1,151

Effect of changes in discount rate assumptions ( 162 ) ( 310 ) ( 3 )

Balance, end of year $ 4,189 $ 2,165 $ 1,148

Net liability for future policy benefits $ 4,189 $ 2,165 $ 1,148

Reinsurance recoverable — — —

Net liability for future policy benefits, after reinsurance recoverable $ 4,189 $ 2,165 $ 1,148

Weighted-average duration of liability for future policyholder benefits (years) 8.23 8.09 8.75

December 31, 2023 December 31, 2022 December 31, 2021

Immediate annuities

Balance, beginning of year $ 1,429 $ 1,954 $ 2,153

Beginning balance at original discount rate 1,858 1,935 2,040

Effect of changes in cash flow assumptions — — —

Effect of actual variances from expected experience ( 15 ) ( 26 ) ( 47 )

Balance adjusted for variances from expectation $ 1,843 $ 1,909 $ 1,993

Issuances 22 26 18

Interest accrual 51 60 60

Benefits payments ( 128 ) ( 137 ) ( 136 )

Ending Balance at original discount rate $ 1,788 $ 1,858 $ 1,935

Effect of changes in discount rate assumptions ( 373 ) ( 429 ) 19

Balance, end of year $ 1,415 $ 1,429 $ 1,954

Net liability for future policy benefits $ 1,415 $ 1,429 $ 1,954

Reinsurance recoverable 116 118 145

Net liability for future policy benefits, after reinsurance recoverable $ 1,299 $ 1,311 $ 1,809

Weighted-average duration of liability for future policyholder benefits (years) 12.47 11.76 13.61

The following tables summarize balances and changes in the liability for DPL for limited-payment contracts:

December 31, 2023 December 31, 2022 December 31, 2021

Immediate annuities PRT Immediate annuities PRT Immediate annuities PRT

(In millions)

Net earnings attributable to FNF common shareholders $ 1,136 $ 2,422 $ 1,427

Decrease in additional paid-in capital for decrease in ownership of F&G ( 19 ) — —

Decrease in retained earnings for decrease in ownership of F&G ( 301 ) — —

Increase in accumulated comprehensive earnings for decrease in ownership of F&G 29 — —

Increase in additional paid-in capital for increase in ownership percentage in ServiceLink — — 211

Decrease in noncontrolling interests resulting from increased ownership in ServiceLink — — 47

Net transfers (to) from noncontrolling interests ( 291 ) — 258

Change in net earnings and equity attributable to FNF common shareholders $ 845 $ 2,422 $ 1,685

Balance, beginning of year $ 69 $ 4 $ 57 $ 7 $ 22 $ —

Effect of modeling changes 4 — — — — —

Effect of changes in cash flow assumptions — 1 — ( 2 ) — —

Effect of actual variances from expected experience 16 5 16 — 39 —

Balance adjusted for variances from expectation 89 10 73 5 61 —

Issuances 3 — 1 — — 7

Interest accrual 2 1 2 — 2 —

Amortization ( 7 ) ( 1 ) ( 7 ) ( 1 ) ( 6 ) —

Balance, end of year $ 87 $ 10 $ 69 $ 4 $ 57 $ 7

The following table reconciles the net FPB to the FPB in the Consolidated Balance Sheets.

The DPL for Immediate Annuities and PRT is presented together with the FPB in the Consolidated Balance Sheets and has been included as a reconciling item in the table below:

December 31, 2023 December 31, 2022 December 31, 2021

(In millions)

Traditional Life $ 1,349 $ 1,354 $ 1,752

Immediate annuities 1,415 1,429 1,954

PRT 4,189 2,165 1,148

Immediate annuities DPL 87 69 57

PRT DPL 10 4 7

Total $ 7,050 $ 5,021 $ 4,918

The following table provides the amount of undiscounted and discounted expected gross premiums and expected future benefits and expenses for nonparticipating traditional and limited-payment contracts:

Undiscounted Discounted

December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022

Traditional Life (In millions)

Expected future benefit payments $ 2,935 $ 3,132 $ 2,075 $ 2,640

Expected future gross premiums 1,082 1,209 789 1,043

Immediate annuities

Expected future benefit payments $ 3,291 $ 3,434 $ 1,413 $ 1,858

Expected future gross premiums — — — —

Expected future benefit payments $ 6,709 $ 3,569 $ 4,350 $ 2,472

Expected future gross premiums — — — —

The following table summarizes the amount of revenue and interest related to nonparticipating traditional and limited-payment contracts recognized in the Consolidated Statements of Earnings:

Gross Premiums (a) Interest Expense (b)

December 31, 2023 December 31, 2022 December 31, 2021 December 31, 2023 December 31, 2022 December 31, 2021

(In millions)

Traditional Life $ 123 $ 137 $ 152 $ 37 $ 39 $ 40

Immediate annuities 24 23 16 51 60 60

PRT 1,964 1,362 1,146 109 50 2

Total $ 2,111 $ 1,522 $ 1,314 $ 197 $ 149 $ 102

(a) Included in Life insurance premiums and other fees on the Consolidated Statements of Earnings.

(b) Included in Benefits and other changes in policy reserves (remeasurement gains (losses) (a)) on the Consolidated Statements of Earnings.

The following table presents the weighted-average interest rate:

December 31, 2023 December 31, 2022 December 31, 2021

Traditional Life

Interest accretion rate 2.33 % 2.32 % 2.29 %

Current discount rate 5.03 % 5.37 % 2.41 %

Immediate annuities

Interest accretion rate 3.14 % 3.07 % 3.04 %

Current discount rate 4.98 % 5.21 % 3.07 %

Interest accretion rate 4.61 % 3.20 % 1.20 %

Current discount rate 5.03 % 5.40 % 2.79 %

The following tables summarize the actual experience and expected experience for mortality and lapses of the FPB:

December 31, 2023

Traditional Life Immediate annuities PRT

Actual experience 1.7 % 3.2 % 3.2 %

Expected experience 1.4 % 1.8 % 2.3 %

Actual experience — % — % — %

Expected experience 0.3 % — % — %

December 31, 2022

Traditional Life Immediate annuities PRT

Actual experience 1.5 % 3.0 % 1.9 %

Expected experience 1.3 % 1.9 % 2.5 %

Actual experience — % — % — %

Expected experience 0.3 % — % — %

December 31, 2021

Traditional Life Immediate annuities PRT

Actual experience 1.7 % 4.2 % — %

Expected experience 1.3 % 2.0 % — %

Actual experience 0.1 % — % — %

Expected experience 0.3 % — % — %

The following table provides additional information for periods in which a cohort has an NPR > 100% (and therefore capped at 100%) (dollars in millions):

December 31, 2022

Cohort X Description (a)

Net Premium Ratio before capping 100 % Term with ROP Non-NY Cohort

Reserves before NP Ratio capping $ 1,172 Term with ROP Non-NY Cohort

Reserves after NP Ratio capping $ 1,173 Term with ROP Non-NY Cohort

Loss Expense — Term with ROP Non-NY Cohort

(a) Return of Premium (“ROP”)

F&G realized actual-to-expected experience variances and made changes to assumptions during the years ended December 31, 2023 and 2022 as follows:

Traditional life

Significant assumption inputs to the calculation of the FPB for traditional life include mortality, lapses (including lapses due to nonpayment of premium and surrenders for cash surrender value), and discount rates (both accretion and current).

We review the cash flow assumptions annually, typically in the third quarter.

In 2023, F&G undertook a review of all significant assumptions and revised the lapse assumption, resulting in a slight decrease to the FPB.

There have been no other significant changes.

Market data that underlies current discount rates was updated in 2023 from that utilized in 2022 resulting in decreased discount rates that drove a material increase to the FPB.

In 2022, F&G similarly undertook a review in the third quarter of the significant cash flow assumptions and did not make any changes to mortality or lapses.

Market data that underlies current discount rates was updated from 2021 and increased significantly year-over-year, resulting in a material decrease to the FPB.

Impacts to expected net premiums and expected FPBs due to discount rate changes in 2022 can be observed in the FPB roll forward tables at December 31, 2022.

Immediate annuities (life contingent)

Significant assumption inputs to the calculation of the FPB for immediate annuities (life contingent) include mortality and discount rates (both accretion and current).

We review the cash flow assumptions annually, typically in the third quarter.

In 2023, F&G undertook a review of the significant cash flow assumptions and did not make any changes to mortality.

Market data that underlies current discount rates was updated in 2023 from that utilized in 2022, resulting in decreased discount rates that drove a material increase to the FPB.

In 2022, F&G similarly undertook a review of the significant cash flow assumptions and did not make any changes to those assumptions.

Market data that underlies current discount rates was updated from 2021 and increased significantly year-over-year, resulting in a material decrease to the FPB.

Impacts to expected FPBs due to assumption changes in 2022 can be observed in the FPB roll forward tables at December 31, 2022.

PRT (life contingent)

Significant assumption inputs to the calculation of the FPB for PRT (life contingent) include mortality and discount rates (both accretion and current).

We review the cash flow assumptions annually, typically in the third quarter.

In 2023, F&G undertook a review of the significant cash flow assumptions and did not make any changes to mortality.

Market data that underlies current discount rates was updated in 2023 from that utilized in 2022 resulting in decreased discount rates that drove a material increase to the FPB.

In 2022, F&G similarly undertook a review of the significant cash flow assumption and did not make any changes to mortality.

Market data that underlies current discount rates was updated from 2021 and increased significantly year-over-year, resulting in a material decrease to the FPB.

Impacts to expected FPBs due to assumption changes in 2022 can be observed in the FPB roll forward tables at December 31, 2022.

Premium deficiency testing

F&G conducts annual premium deficiency testing for its long-duration contracts except for the FPB for nonparticipating traditional and limited-payment contracts.

F&G also conducts annual premium deficiency testing for the VOBA of all long-duration contracts.

Premium deficiency testing is performed by reviewing assumptions used to calculate the insurance liabilities and determining whether the sum of the existing contract liabilities and the present value of future gross premiums is sufficient to cover the present value of future benefits to be paid to or on behalf of policyholders and settlement costs and recover unamortized present value of future profits.

Anticipated investment income, based on F&G’s experience, is considered when performing premium deficiency testing for long-duration contracts.

During 2023 and 2022, F&G was not required to establish any additional liabilities as a result of premium deficiency testing.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data