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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended
September 30, 2024
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from_______________________to_______________________
Commission File No.
033-28976
RIVERSOURCE LIFE INSURANCE COMPANY
(Exact name of registrant as specified in its charter)
Minnesota 41-0823832
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
1099 Ameriprise Financial CenterMinneapolisMinnesota55474
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (612)671-3131
Former name, former address and former fiscal year, if changed since last report: Not Applicable
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
 
Name of each exchange on which registered
Common Stock (par value $30 per share)NoneNone
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days   YesNo
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
YesNo
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated FilerAccelerated FilerNon-accelerated FilerSmaller reporting companyEmerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  YesNo
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Class Outstanding at November 1, 2024
Common Stock (par value $30 per share)100,000 shares
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS H(1) (a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT.


Index
RIVERSOURCE LIFE INSURANCE COMPANY
FORM 10-Q
INDEX





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2

Index
RIVERSOURCE LIFE INSURANCE COMPANY
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
 
September 30, 2024
December 31, 2023
(in millions, except share amounts)
Assets
Investments:
Available-for-Sale: Fixed maturities, at fair value (amortized cost: 2024, $22,126; 2023, $19,871) (allowance for credit losses: 2024, $1; 2023, $2)
$22,071 $19,374 
Mortgage loans, at amortized cost (allowance for credit losses: 2024, $10; 2023, $10)
1,780 1,725 
Policy loans966 912 
Other investments (allowance for credit losses: 2024, nil; 2023, nil)
135 165 
Total investments24,952 22,176 
Investments of consolidated investment entities, at fair value2,243 2,099 
Cash and cash equivalents3,200 2,598 
Cash of consolidated investment entities124 87 
Market risk benefits1,809 1,427 
Reinsurance recoverables (allowance for credit losses: 2024, $26; 2023, $27)
4,285 4,284 
Receivables 6,274 6,702 
Receivables of consolidated investment entities, at fair value18 28 
Accrued investment income215 176 
Deferred acquisition costs2,670 2,696 
Other assets9,672 6,977 
Other assets of consolidated investment entities, at fair value1 1 
Separate account assets78,631 74,634 
Total assets$134,094 $123,885 
Liabilities and Shareholder’s Equity
Liabilities:
Policyholder account balances, future policy benefits and claims$41,323 $37,535 
Market risk benefits1,579 1,762 
Short-term borrowings201 201 
Long-term debt500 500 
Debt of consolidated investment entities, at fair value2,271 2,155 
Other liabilities8,290 5,896 
Other liabilities of consolidated investment entities, at fair value84 45 
Separate account liabilities78,631 74,634 
Total liabilities132,879 122,728 
Shareholder’s equity:
Common stock, $30 par value; 100,000 shares authorized, issued and outstanding
3 3 
Additional paid-in capital2,466 2,466 
Accumulated deficit(811)(618)
Accumulated other comprehensive income (loss), net of tax(443)(694)
Total shareholder’s equity1,215 1,157 
Total liabilities and shareholder’s equity$134,094 $123,885 
See Notes to Consolidated Financial Statements.
3

Index
RIVERSOURCE LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions)
Revenues
Premiums$130 $115 $369 $323 
Net investment income382 332 1,133 950 
Policy and contract charges526 509 1,538 1,510 
Other revenues144 148 434 447 
Net realized investment gains (losses)(2)(48)(43)(58)
Total revenues1,180 1,056 3,431 3,172 
Benefits and expenses
Benefits, claims, losses and settlement expenses429 119 1,055 746 
Interest credited to fixed accounts118 139 435 464 
Remeasurement (gains) losses of future policy benefit reserves(22)(12)(34)(17)
Change in fair value of market risk benefits566 168 658 558 
Amortization of deferred acquisition costs57 60 175 180 
Interest and debt expense51 49 145 143 
Other insurance and operating expenses178 169 541 525 
Total benefits and expenses1,377 692 2,975 2,599 
Pretax income (loss)(197)364 456 573 
Income tax provision (benefit)(43)35 49 46 
Net income (loss)$(154)$329 $407 $527 
See Notes to Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions)
Net income (loss)$(154)$329 $407 $527 
Other comprehensive income (loss), net of tax:
Net unrealized gains (losses) on securities634 (427)344 (326)
Effect of changes in discount rate assumptions on certain long-duration contracts(147)174 (16)168 
Effect of changes in instrument-specific credit risk on market risk benefits(49)18 (77)53 
Total other comprehensive income (loss), net of tax438 (235)251 (105)
Total comprehensive income (loss)$284 $94 $658 $422 
See Notes to Consolidated Financial Statements.
4

Index
RIVERSOURCE LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY (UNAUDITED)
Common SharesAdditional Paid-In CapitalRetained Earnings (Accumulated Deficit)Accumulated Other 
Comprehensive Income (Loss)
Total
(in millions)
Balances at July 1, 2024
$3 $2,466 $(457)$(881)$1,131 
Net income (loss)— — (154)— (154)
Other comprehensive income (loss), net of tax— — — 438 438 
Cash dividends to Ameriprise Financial, Inc.— — (200)— (200)
Balances at September 30, 2024
$3 $2,466 $(811)$(443)$1,215 
Balances at July 1, 2023
$3 $2,466 $(614)$(954)$901 
Net income (loss)— — 329 — 329 
Other comprehensive income (loss), net of tax— — — (235)(235)
Cash dividends to Ameriprise Financial, Inc.— — (100)— (100)
Balances at September 30, 2023
$3 $2,466 $(385)$(1,189)$895 
Balances at January 1, 2024
$3 $2,466 $(618)$(694)$1,157 
Net income (loss)— — 407 — 407 
Other comprehensive income (loss), net of tax— — — 251 251 
Cash dividends to Ameriprise Financial, Inc.
— — (600)— (600)
Balances at September 30, 2024
$3 $2,466 $(811)$(443)$1,215 
Balances at January 1, 2023
$3 $2,466 $(412)$(1,084)$973 
Net income (loss)— — 527 — 527 
Other comprehensive income (loss), net of tax— — — (105)(105)
Cash dividends to Ameriprise Financial, Inc.
— — (500)— (500)
Balances at September 30, 2023
$3 $2,466 $(385)$(1,189)$895 
See Notes to Consolidated Financial Statements.
5

Index
RIVERSOURCE LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Nine Months Ended September 30,
2024
2023
(in millions)
Cash Flows from Operating Activities
Net income$407 $527 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation, amortization and accretion, net(146)(155)
Deferred income tax expense (benefit)
232 129 
Contractholder and policyholder charges, non-cash(306)(300)
Loss from equity method investments18 20 
Net realized investment (gains) losses(3)47 
Impairments and provision for loan losses(1)(21)
Net (gains) losses of consolidated investment entities
5 18 
Changes in operating assets and liabilities: 
Deferred acquisition costs26 51 
Policyholder account balances, future policy benefits and claims, and market risk benefits, net3,751 1,531 
Derivatives, net of collateral(1,122)(426)
Reinsurance recoverables68 79 
Receivables158 247 
Accrued investment income(39)(36)
Current income tax, net134 (261)
Other operating assets and liabilities of consolidated investment entities, net
1 (8)
Other, net293 137 
Net cash provided by (used in) operating activities3,476 1,579 
Cash Flows from Investing Activities
Available-for-Sale securities:
Proceeds from sales947 610 
Maturities, sinking fund payments and calls1,163 714 
Purchases(4,277)(3,226)
Proceeds from sales, maturities and repayments of mortgage loans96 86 
Funding of mortgage loans(151)(36)
Proceeds from sales and collections of other investments24 18 
Purchase of other investments(13)(9)
Purchase of investments by consolidated investment entities (791)(347)
Proceeds from sales, maturities and repayments of investments by consolidated investment entities700 492 
Purchase of equipment and software(8)(7)
Change in policy loans, net(54)(43)
Cash paid for deposit receivable
(25)(30)
Cash received for deposit receivable470 579 
Advance on line of credit to Ameriprise Financial, Inc.(450)(400)
Repayment from Ameriprise Financial, Inc. on line of credit450 400 
Cash paid for written options with deferred premiums(57)(59)
Cash received from written options with deferred premiums22 43 
Other, net(32)(39)
Net cash provided by (used in) investing activities$(1,986)$(1,254)
See Notes to Consolidated Financial Statements.
6

Index
RIVERSOURCE LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (continued)
Nine Months Ended September 30,
2024
2023
(in millions)
Cash Flows from Financing Activities
Policyholder account balances:
Deposits and other additions$1,094 $1,033 
Net transfers from (to) separate accounts(124)(89)
Surrenders and other benefits(1,385)(1,539)
Proceeds from line of credit with Ameriprise Financial, Inc.3  
Payments on line of credit with Ameriprise Financial, Inc.(3) 
Cash paid for purchased options with deferred premiums(122)(49)
Cash received for purchased options with deferred premiums181 251 
Borrowings of consolidated investment entities
883  
Repayments of debt by consolidated investment entities(778)(197)
Cash dividends to Ameriprise Financial, Inc.(600)(500)
Net cash provided by (used in) financing activities(851)(1,090)
Net increase (decrease) in cash and cash equivalents639 (765)
Cash and cash equivalents at beginning of period2,685 2,744 
Cash and cash equivalents at end of period$3,324 $1,979 
Supplemental Disclosures:
Income taxes paid (received), net$(316)$179 
Interest paid excluding consolidated investment entities27 25 
Interest paid by consolidated investment entities126 132 
See Notes to Consolidated Financial Statements.
7


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. Basis of Presentation
RiverSource Life Insurance Company is a stock life insurance company with one wholly owned stock life insurance company subsidiary, RiverSource Life Insurance Co. of New York (“RiverSource Life of NY”). RiverSource Life Insurance Company is a wholly owned subsidiary of Ameriprise Financial, Inc. (“Ameriprise Financial”).
RiverSource Life Insurance Company is domiciled in Minnesota and holds Certificates of Authority in American Samoa, the District of Columbia and all states except New York. RiverSource Life Insurance Company issues insurance and annuity products.
RiverSource Life of NY is domiciled and holds a Certificate of Authority in New York. RiverSource Life of NY issues insurance and annuity products.
RiverSource Life Insurance Company also wholly owns RiverSource Tax Advantaged Investments, Inc. (“RTA”) and Columbia Cent CLO Advisors, LLC (“Columbia Cent”). RTA is a stock company domiciled in Delaware and is a limited partner in affordable housing partnership investments. Columbia Cent provides asset management services to collateralized loan obligations (“CLOs”).
The accompanying Consolidated Financial Statements include the accounts of RiverSource Life Insurance Company and companies in which it directly or indirectly has a controlling financial interest and variable interest entities (“VIEs”) in which it is the primary beneficiary (collectively, the “Company”). All intercompany transactions and balances have been eliminated in consolidation.
The interim financial information in this report has not been audited. In the opinion of management, all adjustments necessary for fair statement of the consolidated financial position and results of operations for the interim periods have been made. All adjustments made were of a normal recurring nature.
The accompanying Consolidated Financial Statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Results of operations reported for interim periods are not necessarily indicative of results for the entire year. These Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”) on February 22, 2024 (“2023 10-K”).
The Company evaluated events or transactions that occurred after the balance sheet date for potential recognition or disclosure through the date the financial statements were issued. No subsequent events or transactions requiring recognition or disclosure were identified.
2. Recent Accounting Pronouncements
Future Adoption of New Accounting Standards
Segment Reporting – Improvements to Reportable Segment Disclosures
In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Improvements to Reportable Segment Disclosures, updating reportable segment disclosure requirements in accordance with Topic 280, Segment Reporting (“Topic 280”), primarily through enhanced disclosures about significant segment expenses. In addition, the amendments enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss and contain other disclosure requirements. The amendments also expand Topic 280 disclosures to public entities with one reportable segment. The amendments are effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024. Early adoption is permitted. The Company is assessing changes to the segment-related disclosures resulting from the standard. The adoption of the standard will not have an impact on the Company’s consolidated financial condition and results of operations as the standard is disclosure-related only.
Income Taxes – Improvements to Income Tax Disclosures
In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, updating the accounting standards related to income tax disclosures, primarily focused on the disaggregation of income taxes paid and the rate reconciliation table. The standard is to be applied prospectively with an option for retrospective application and is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is assessing changes to the income tax-related disclosures resulting from the standard. The adoption of the standard will not have an impact on the Company’s consolidated financial condition and results of operations as the standard is disclosure-related only.
8


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
3. Revenue from Contracts with Customers
The following table presents disaggregated revenue from contracts with customers and a reconciliation to total revenues reported on the Consolidated Statements of Income.
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions)
Policy and contract charges
Affiliated$40 $38 $118 $114 
Unaffiliated4 4 11 11 
Total44 42 129 125 
Other revenues
Administrative fees
Affiliated11 10 31 29 
Unaffiliated4 4 14 13 
15 14 45 42 
Other fees
Affiliated80 77 239 232 
Unaffiliated1 1 3 3 
81 78 242 235 
Total96 92 287 277 
Total revenue from contracts with customers140 134 416 402 
Revenue from other sources (1)
1,040 922 3,015 2,770 
Total revenues$1,180 $1,056 $3,431 $3,172 
(1) Amounts primarily consist of revenue associated with insurance and annuity products and investment income from financial instruments.
The following discussion describes the nature, timing, and uncertainty of revenues and cash flows arising from the Company’s contracts with customers.
Policy and Contract Charges
The Company earns revenue for providing distribution-related services to affiliated and unaffiliated mutual funds that are available as underlying investments in its variable annuity and variable life insurance products. The performance obligation is satisfied at the time the mutual fund is distributed. Revenue is recognized over the time the mutual fund is held in the variable product and is generally earned based on a fixed rate applied, as a percentage, to the net asset value of the fund. The revenue is not recognized at the time of sale because it is variably constrained due to factors outside the Company’s control, including market volatility and how long the fund(s) remain in the insurance policy or annuity contract. The revenue will not be recognized until it is probable that a significant reversal will not occur. These fees are accrued and collected on a monthly basis.
Other Revenues
Administrative Fees
The Company earns revenue for providing customer support, contract servicing and administrative services for affiliated and unaffiliated mutual funds that are available as underlying instruments in its variable annuity and variable life insurance products. The transfer agent and administration revenue is earned daily based on a fixed rate applied, as a percentage, to assets under management. These performance obligations are considered a series of distinct services that are substantially the same and are satisfied each day over the contract term. These fees are accrued and collected on a monthly basis.
Other Fees
The Company earns revenue for providing affiliated and unaffiliated partners an opportunity to educate the financial advisors of its affiliate, Ameriprise Financial Services, LLC (“AFS”), that sell the Company's products as well as product and marketing personnel to support the offer, sale and servicing of funds within the Company's variable annuity and variable life insurance products. These payments allow the parties to train and support the advisors, explain the features of their products, and distribute marketing and educational materials. The affiliated revenue is earned based on a rate, updated at least annually, which is applied, as a percentage, to the market value of assets invested. The unaffiliated revenue is earned based on a fixed rate applied, as a percentage, to the market value of assets invested. These performance obligations are considered a series of distinct services that are substantially the same and are satisfied each day over the contract term. These fees are accrued and collected on a monthly basis.
9


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Receivables
Receivables for revenue from contracts with customers are recognized when the performance obligation is satisfied and the Company has an unconditional right to the revenue. Receivables related to revenues from contracts with customers were $48 million and $49 million as of September 30, 2024 and December 31, 2023, respectively.
4. Variable Interest Entities
The Company provides asset management services to CLOs which are considered to be VIEs that are sponsored by the Company. In addition, the Company invests in structured investments other than CLOs and certain affordable housing partnerships which are considered VIEs. The Company consolidates the CLOs if the Company is deemed to be the primary beneficiary. The Company has no obligation to provide financial or other support to the non-consolidated VIEs beyond its initial investment and existing future funding commitments, and the Company has not provided any additional support to these entities. The Company has unfunded commitments related to consolidated CLOs of $8 million and $24 million as of September 30, 2024 and December 31, 2023, respectively.
Structured Investments
The Company invests in structured investments which are considered VIEs for which it is not the sponsor. These structured investments typically invest in fixed income instruments and are managed by third parties and include asset backed securities and commercial and residential mortgage backed securities. The Company classifies these investments as Available-for-Sale securities. The Company has determined that it is not the primary beneficiary of these structures due to the size of the Company’s investment in the entities and position in the capital structure of these entities.
Additionally, the Company invests in CLOs for which it is the sponsor. CLOs are asset backed financing entities collateralized by a pool of assets, primarily syndicated loans and, to a lesser extent, high-yield bonds. Multiple tranches of debt securities are issued by a CLO, offering investors various maturity and credit risk characteristics. The debt securities issued by the CLOs are non-recourse to the Company. The CLO’s debt holders have recourse only to the assets of the CLO. The assets of the CLOs cannot be used by the Company. Scheduled debt payments are based on the performance of the CLO’s collateral pool. The Company earns management fees from the CLOs based on the value of the CLO’s collateral pool and, in certain instances, may also receive incentive fees. The fee arrangement is at market and commensurate with the level of effort required to provide those services. The Company has invested in a portion of the unrated, junior subordinated notes and highly rated senior notes of certain CLOs. The Company consolidates certain CLOs where it is the primary beneficiary.
The Company’s maximum exposure to loss with respect to structured investments and non-consolidated CLOs is limited to its amortized cost. The Company classifies these investments as Available-for-Sale securities. See Note 5 for additional information on these investments.
Affordable Housing Partnerships and Other Real Estate Partnerships
The Company is a limited partner in affordable housing partnerships that qualify for government-sponsored low income housing tax credit programs and partnerships that invest in multi-family residential properties that were originally developed with an affordable housing component. The Company has determined it is not the primary beneficiary and therefore does not consolidate these partnerships.
A majority of the limited partnerships are VIEs. The Company’s maximum exposure to loss as a result of its investment in the VIEs is limited to the carrying value. The carrying value is reflected in Other investments and was $54 million and $70 million as of September 30, 2024 and December 31, 2023, respectively. The Company’s liability related to original purchase commitments not yet remitted to the VIEs was not material as of both September 30, 2024 and December 31, 2023. The Company has not provided any additional support and is not contractually obligated to provide additional support to the VIEs beyond the funding commitments.
Fair Value of Assets and Liabilities
The Company categorizes its fair value measurements according to a three-level hierarchy. See Note 12 for the definition of the three levels of the fair value hierarchy.
10


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables present the balances of assets and liabilities held by consolidated investment entities measured at fair value on a recurring basis:
 
September 30, 2024
Level 1Level 2Level 3Total
(in millions)
Assets
Investments:
Corporate debt securities$ $50 $ $50 
Common stocks 5  5 
Syndicated loans 2,112 76 2,188 
Total investments 2,167 76 2,243 
Receivables 18  18 
Other assets 1  1 
Total assets at fair value$ $2,186 $76 $2,262 
Liabilities
Debt (1)
$ $2,271 $ $2,271 
Other liabilities 84  84 
Total liabilities at fair value$ $2,355 $ $2,355 
 
December 31, 2023
Level 1Level 2Level 3Total
(in millions)
Assets
Investments:
Corporate debt securities$ $40 $ $40 
Common stocks 5  5 
Syndicated loans 1,991 63 2,054 
Total investments 2,036 63 2,099 
Receivables 28  28 
Other assets 1  1 
Total assets at fair value$ $2,065 $63 $2,128 
Liabilities
Debt (1)
$ $2,155 $ $2,155 
Other liabilities 45  45 
Total liabilities at fair value$ $2,200 $ $2,200 
(1) The carrying value of the CLOs’ debt is set equal to the fair value of the CLOs’ assets. The estimated fair value of the CLOs’ debt was $2.2 billion and $2.1 billion as of September 30, 2024 and December 31, 2023, respectively.    
11


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables provide a summary of changes in Level 3 assets held by consolidated investment entities measured at fair value on a recurring basis:
 Common StocksSyndicated Loans
(in millions)
Balance at July 1, 2024
$2 $86 
Total gains (losses) included in:
Net income(1)1 (1)
Purchases 27 
Sales(1) 
Settlements (2)
Transfers into Level 3 27 
Transfers out of Level 3 (63)
Balance at September 30, 2024
$ $76 

 Syndicated Loans
(in millions)
Balance at July 1, 2023
$67 
Purchases4 
Settlements(1)
Transfers into Level 322 
Transfers out of Level 3(38)
Balance at September 30, 2023
$54 
Changes in unrealized gains (losses) included in net income relating to assets held at September 30, 2023
$2 (1)

 Common StocksSyndicated Loans
(in millions)
Balance at January 1, 2024
$ $63 
Total gains (losses) included in:
Net income(1)(6)(1)
Purchases 111 
Sales(1) 
Settlements (2)
Transfers into Level 33 67 
Transfers out of Level 3(1)(157)
Balance at September 30, 2024
$ $76 
12


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
 Syndicated LoansOther Assets
(in millions)
Balance at January 1, 2023
$125 $1 
Total gains (losses) included in:
Net income(3)(1) 
Purchases31  
Sales(10) 
Settlements(16) 
Transfers into Level 382  
Transfers out of Level 3(155)(1)
Balance at September 30, 2023
$54 $ 
Changes in unrealized gains (losses) included in net income relating to assets held at September 30, 2023
$2 (1)$ 
(1) Included in Net investment income.
Securities and loans transferred from Level 3 primarily represent assets with fair values that are now obtained from a third-party pricing service with observable inputs or priced in active markets. Securities and loans transferred to Level 3 represent assets with fair values that are now based on a single non-binding broker quote.
All Level 3 measurements as of September 30, 2024 and December 31, 2023 were obtained from non-binding broker quotes where unobservable inputs utilized in the fair value calculation are not reasonably available to the Company.
Determination of Fair Value
Assets
Investments
The fair value of syndicated loans obtained from third-party pricing services using a market approach with observable inputs is classified as Level 2. The fair value of syndicated loans obtained from third-party pricing services with a single non-binding broker quote as the underlying valuation source is classified as Level 3. The underlying inputs used in non-binding broker quotes are not readily available to the Company. See Note 12 for a description of the Company’s determination of the fair value of corporate debt securities, common stocks and other investments.
Receivables
For receivables of the consolidated CLOs, the carrying value approximates fair value as the nature of these assets has historically been short-term and the receivables have been collectible. The fair value of these receivables is classified as Level 2.
Liabilities
Debt
The fair value of the CLOs’ assets, typically syndicated bank loans, is more observable than the fair value of the CLOs’ debt tranches for which market activity is limited and less transparent. As a result, the fair value of the CLOs’ debt is set equal to the fair value of the CLOs’ assets and is classified as Level 2.
Other Liabilities
Other liabilities consist primarily of securities purchased but not yet settled by consolidated CLOs. The carrying value approximates fair value as the nature of these liabilities has historically been short-term. The fair value of these liabilities is classified as Level 2. Other liabilities also include accrued interest on CLO debt.
Fair Value Option
The Company has elected the fair value option for the financial assets and liabilities of the consolidated CLOs. Management believes that the use of the fair value option better matches the changes in fair value of assets and liabilities related to the CLOs.
13


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following table presents the fair value and unpaid principal balance of loans and debt for which the fair value option has been elected:
September 30, 2024
December 31, 2023
(in millions)
Syndicated loans 
Unpaid principal balance$2,285 $2,190 
Excess unpaid principal over fair value(97)(136)
Fair value$2,188 $2,054 
Fair value of loans in nonaccrual status3 13 
Difference between fair value and unpaid principal of loans more than 90 days past due, loans in nonaccrual status or both
13 40 
Debt 
Unpaid principal balance$2,469 $2,362 
Excess unpaid principal over fair value(198)(207)
Carrying value (1)
$2,271 $2,155 
(1) The carrying value of the CLOs’ debt is set equal to the fair value of the CLOs’ assets. The estimated fair value of the CLOs’ debt was $2.2 billion and $2.1 billion as of September 30, 2024 and December 31, 2023, respectively.
During the second quarter of 2024, the Company launched one new CLO. The new CLO issued debt of $407 million.
Interest income from syndicated loans, bonds and structured investments is recorded based on contractual rates in Net investment income. Gains and losses related to changes in the fair value of investments are recorded in Net investment income and gains and losses on sales of investments are recorded in Net realized investment gains (losses). Interest expense on debt is recorded in Interest and debt expense with gains and losses related to changes in the fair value of debt recorded in Net investment income.
Total net gains (losses) recognized in Net investment income related to the changes in fair value of investments the Company owns in the consolidated CLOs where it has elected the fair value option and collateralized financing entity accounting were immaterial for both the three and nine months ended September 30, 2024 and 2023.
Debt of the consolidated investment entities and the stated interest rates were as follows:
 Carrying ValueWeighted Average Interest Rate
September 30, 2024
December 31, 2023
September 30, 2024
December 31, 2023
(in millions) 
Debt of consolidated CLOs due 2030 -2037
$2,271 $2,155 6.6 %6.6 %
The debt of the consolidated CLOs has both fixed and floating interest rates, which range from nil to 14.8%. The interest rates on the debt of CLOs are weighted average rates based on the outstanding principal and contractual interest rates.
14


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
5. Investments
Available-for-Sale securities distributed by type were as follows:
Description of Securities
September 30, 2024
Amortized CostGross Unrealized GainsGross Unrealized LossesAllowance for Credit LossesFair Value
 (in millions)
Fixed maturities:     
Corporate debt securities$12,860 $514 $(394)$ $12,980 
Residential mortgage backed securities4,168 37 (201) 4,004 
Commercial mortgage backed securities2,312 12 (95) 2,229 
State and municipal obligations644 56 (14)(1)685 
Asset backed securities2,134 37 (6) 2,165 
Foreign government bonds and obligations7    7 
U.S. government and agency obligations1    1 
Total$22,126 $656 $(710)$(1)$22,071 
Description of Securities
December 31, 2023
Amortized CostGross Unrealized GainsGross Unrealized LossesAllowance for Credit LossesFair Value
(in millions)
Fixed maturities:    
Corporate debt securities$10,828 $405 $(497)$(1)$10,735 
Residential mortgage backed securities3,886 20 (264) 3,642 
Commercial mortgage backed securities2,784 6 (193) 2,597 
State and municipal obligations717 61 (19)(1)758 
Asset backed securities1,545 7 (21) 1,531 
Foreign government bonds and obligations12    12 
U.S. government and agency obligations99    99 
Total$19,871 $499 $(994)$(2)$19,374 
As of September 30, 2024 and December 31, 2023, accrued interest of $206 million and $168 million, respectively, is excluded from the amortized cost basis of Available-for-Sale securities in the tables above and is recorded in Accrued investment income.
As of September 30, 2024 and December 31, 2023, fixed maturity securities comprised approximately 88% and 87%, respectively, of the Company’s total investments. Rating agency designations are based on the availability of ratings from Nationally Recognized Statistical Rating Organizations (“NRSROs”), including Moody’s Investors Service (“Moody’s”), Standard & Poor’s Ratings Services (“S&P”) and Fitch Ratings Ltd. (“Fitch”). The Company uses the median of available ratings from Moody’s, S&P and Fitch, or if fewer than three ratings are available, the lower rating is used. When ratings from Moody’s, S&P and Fitch are unavailable, the Company may utilize ratings from other NRSROs or rate the securities internally. As of September 30, 2024 and December 31, 2023, $428 million and $265 million, respectively, of securities were internally rated by Columbia Management Investment Advisers, LLC, an affiliate of the Company, using criteria similar to those used by NRSROs.
15


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
A summary of fixed maturity securities by rating was as follows:
Ratings
September 30, 2024
December 31, 2023
Amortized CostFair ValuePercent of Total Fair ValueAmortized CostFair ValuePercent of Total Fair Value
 (in millions, except percentages)
AAA$4,404 $4,318 20 %$4,558 $4,337 22 %
AA4,346 4,268 19 3,961 3,799 20 
A2,682 2,792 13 2,213 2,279 12 
BBB10,431 10,421 47 8,813 8,633 44 
Below investment grade (1)
263 272 1 326 326 2 
Total fixed maturities$22,126 $22,071 100 %$19,871 $19,374 100 %
(1) The amortized cost and fair value of below investment grade securities includes interest in non-consolidated CLOs managed by the Company of $1 million as of both September 30, 2024 and December 31, 2023. These securities are not rated but are included in below investment grade due to their risk characteristics.    
As of September 30, 2024 and December 31, 2023, approximately 57% and 61% of securities rated AA were GNMA, FNMA and FHLMC mortgage backed securities, respectively. As of September 30, 2024, the Company had holdings in Ameriprise Advisor Financing 2, LLC (“AAF2”), an affiliate of the Company, totaling $576 million that was 47% of the Company’s total shareholder’s equity. During June of 2024, the Company invested $310 million in new asset backed securities issued by Ameriprise Installment Financing, LLC. The asset backed securities are collateralized by a portfolio of loans issued to advisors affiliated with AFS, an affiliated broker dealer. As of September 30, 2024, the fair value of these asset backed securities was $322 million which represents 26% of the Company’s total shareholder’s equity. Also, the Company had an additional 43 issuers with holdings totaling $8.0 billion that individually were between 10% and 26% of the Company’s total shareholder’s equity as of September 30, 2024. As of December 31, 2023, the Company had holdings in AAF2 totaling $554 million that was 48% of the Company’s total shareholder’s equity. Also, the Company had an additional 34 issuers with holdings totaling $5.8 billion that individually were between 10% and 23% of the Company’s total shareholder’s equity as of December 31, 2023. There were no other holdings of any other issuer greater than 10% of the Company’s total shareholder’s equity as of September 30, 2024 and December 31, 2023.
The following tables summarize the fair value and gross unrealized losses on Available-for-Sale securities, aggregated by major investment type and the length of time that individual securities have been in a continuous unrealized loss position for which no allowance for credit losses has been recorded:
Description of Securities 
September 30, 2024
Less than 12 Months12 Months or MoreTotal
Number of SecuritiesFair ValueUnrealized LossesNumber of SecuritiesFair Value
Unrealized Losses
Number of SecuritiesFair Value
Unrealized Losses
 (in millions, except number of securities)
Corporate debt securities62 $640 $(9)290 $4,274 $(385)352 $4,914 $(394)
Residential mortgage backed securities5 46  198 1,919 (201)203 1,965 (201)
Commercial mortgage backed securities5 67 (1)174 1,669 (94)179 1,736 (95)
State and municipal obligations5 6 (1)44 136 (13)49 142 (14)
Asset backed securities2 21  19 85 (6)21 106 (6)
Foreign government bonds and obligations   2 6  2 6  
Total79 $780 $(11)727 $8,089 $(699)806 $8,869 $(710)
16


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Description of Securities 
December 31, 2023
Less than 12 Months12 Months or MoreTotal
Number of SecuritiesFair ValueUnrealized LossesNumber of SecuritiesFair ValueUnrealized LossesNumber of SecuritiesFair ValueUnrealized Losses
(in millions, except number of securities)
Corporate debt securities43 $410 $(8)340 $4,735 $(489)383 $5,145 $(497)
Residential mortgage backed securities30 389 (4)204 2,114 (260)234 2,503 (264)
Commercial mortgage backed securities20 264 (4)196 2,062 (189)216 2,326 (193)
State and municipal obligations5 29 (1)47 137 (18)52 166 (19)
Asset backed securities5 102  32 684 (21)37 786 (21)
Foreign government bonds and obligations   2 6  2 6  
U.S. government and agency obligations
1      1   
Total104 $1,194 $(17)821 $9,738 $(977)925 $10,932 $(994)
As part of the Company’s ongoing monitoring process, management determined that the decrease in total gross unrealized losses on its Available-for-Sale securities for which an allowance for credit losses has not been recognized during the nine months ended September 30, 2024 is primarily attributable to the impact of lower interest rates. As of September 30, 2024, the Company did not recognize these unrealized losses in earnings because it was determined that such losses were due to non-credit factors. The Company does not intend to sell these securities and does not believe that it is more likely than not that the Company will be required to sell these securities before the anticipated recovery of the remaining amortized cost basis. As of September 30, 2024 and December 31, 2023, approximately 95% and 94%, respectively, of the total of Available-for-Sale securities with gross unrealized losses were considered investment grade.
The following table presents rollforwards of the allowance for credit losses on Available-for-Sale securities:
Corporate Debt SecuritiesState and Municipal ObligationsTotal
(in millions)
Balance at July 1, 2024
$ $1 $1 
Balance at September 30, 2024
$ $1 $1 
Balance at July 1, 2023
$7 $2 $9 
Reductions for securities sold during the period (realized)(7)(1)(8)
Balance at September 30, 2023
$ $1 $1 
Balance at January 1, 2024
$1 $1 $2 
Reductions for securities sold during the period (realized)(1) (1)
Balance at September 30, 2024
$ $1 $1 
Balance at January 1, 2023
$20 $2 $22 
Reductions for securities sold during the period (realized)(20)(1)(21)
Balance at September 30, 2023
$ $1 $1 
17


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Net realized gains and losses on Available-for-Sale securities, determined using the specific identification method, recognized in Net realized investment gains (losses) were as follows:
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions)
Gross realized investment gains$27 $ $30 $10 
Gross realized investment losses(25)(46)(28)(57)
Credit reversals (losses)
 8 1 21 
Other impairments
   (1)
Total$2 $(38)$3 $(27)

Previously recorded allowance for credit losses was reversed during the three and nine months ended September 30, 2023 primarily due to the sale of a corporate debt security in the communications industry.
See Note 15 for a rollforward of net unrealized investment gains (losses) included in accumulated other comprehensive income (loss) (“AOCI”).
Available-for-Sale securities by contractual maturity as of September 30, 2024 were as follows:

Amortized CostFair Value
(in millions)
Due within one year$390 $387 
Due after one year through five years2,124 2,111 
Due after five years through 10 years5,200 5,099 
Due after 10 years5,798 6,076 
13,512 13,673 
Residential mortgage backed securities4,168 4,004 
Commercial mortgage backed securities2,312 2,229 
Asset backed securities2,134 2,165 
Total$22,126 $22,071 
Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Residential mortgage backed securities, commercial mortgage backed securities and asset backed securities are not due at a single maturity date. As such, these securities were not included in the maturities distribution.
The following is a summary of Net investment income:

Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions)
Fixed maturities$261 $214 $750 $604 
Mortgage loans19 17 54 51 
Other investments108 107 348 314 
388 338 1,152 969 
Less: investment expenses6 6 19 19 
Total$382 $332 $1,133 $950 
18


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
6. Financing Receivables
Financing receivables are comprised of commercial loans, policy loans and deposit receivables.
Allowance for Credit Losses
The following tables present a rollforward of the allowance for credit losses:
Commercial Loans
(in millions)
Balance at January 1, 2024
$10 
Provisions 
Balance at September 30, 2024
$10 
Balance at January 1, 2023
$11 
Provisions(1)
Balance at September 30, 2023
$10 
As of September 30, 2024 and December 31, 2023, accrued interest on commercial loans was $18 million and $15 million, respectively, and is recorded in Accrued investment income and excluded from the amortized cost basis of commercial loans.
Purchases and Sales
During the three months ended September 30, 2024 and 2023, the Company purchased nil of syndicated loans during both three month periods, and sold nil and $1 million, respectively, of syndicated loans. During the nine months ended September 30, 2024 and 2023, the Company purchased $3 million and $1 million, respectively, of syndicated loans, and sold $1 million of syndicated loans during both nine month periods.
The Company has not acquired any loans with deteriorated credit quality as of the acquisition date.
Credit Quality Information
There were no nonperforming loans as of both September 30, 2024 and December 31, 2023. All loans were considered to be performing.
Commercial Loans
Commercial Mortgage Loans
The Company reviews the credit worthiness of the borrower and the performance of the underlying properties in order to determine the risk of loss on commercial mortgage loans. Loan-to-value ratio is the primary credit quality indicator included in this review.
Based on this review, the commercial mortgage loans are assigned an internal risk rating, which management updates when credit risk changes. Commercial mortgage loans which management has assigned its highest risk rating were less than 1% of total commercial mortgage loans as of both September 30, 2024 and December 31, 2023. Loans with the highest risk rating represent distressed loans which the Company has identified as impaired or expects to become delinquent or enter into foreclosure within the next six months. There were no commercial mortgage loans past due as of both September 30, 2024 and December 31, 2023.
The tables below present the amortized cost basis of commercial mortgage loans by year of origination and loan-to-value ratio:
September 30, 2024
Loan-to-Value Ratio20242023202220212020PriorTotal
(in millions)
> 100%$ $ $ $ $ $17 $17 
80% - 100%    10 48 58 
60% - 80%63 39 12 10 6 135 265 
40% - 60%68 22 40 71 37 344 582 
< 40%9 7 47 92 47 666 868 
Total$140 $68 $99 $173 $100 $1,210 $1,790 
19


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
December 31, 2023
Loan-to-Value Ratio20232022202120202019PriorTotal
(in millions)
> 100%$ $ $ $ $2 $20 $22 
80% - 100%   2 11 49 62 
60% - 80%55 26 6 14 40 102 243 
40% - 60%7 46 129 49 65 343 639 
< 40%7 31 43 37 71 580 769 
Total$69 $103 $178 $102 $189 $1,094 $1,735 
Loan-to-value ratio is based on income and expense data provided by borrowers at least annually and long-term capitalization rate assumptions based on property type. For the nine months ended September 30, 2024, write-offs of commercial mortgage loans were not material.
In addition, the Company reviews the concentrations of credit risk by region and property type. Concentrations of credit risk of commercial mortgage loans by U.S. region were as follows:
 LoansPercentage
September 30, 2024
December 31, 2023
September 30, 2024
December 31, 2023
(in millions)  
East North Central$179 $180 10 %10 %
East South Central41 47 2 3 
Middle Atlantic117 97 7 6 
Mountain137 130 8 8 
New England24 21 1 1 
Pacific602 595 34 34 
South Atlantic474 452 26 26 
West North Central111 105 6 6 
West South Central105 108 6 6 
   Total
$1,790 $1,735 100 %100 %
Concentrations of credit risk of commercial mortgage loans by property type were as follows:
 LoansPercentage
September 30, 2024
December 31, 2023
September 30, 2024
December 31, 2023
(in millions)  
Apartments$489 $454 27 %26 %
Hotel33 13 2 1 
Industrial319 293 18 17 
Mixed use59 54 3 3 
Office208 230 12 13 
Retail538 546 30 32 
Other144 145 8 8 
   Total
$1,790 $1,735 100 %100 %
Syndicated Loans
The investment in syndicated loans as of September 30, 2024 and December 31, 2023 was $45 million and $57 million, respectively. The Company’s syndicated loan portfolio is diversified across industries and issuers. There were no syndicated loans past due as of both September 30, 2024 and December 31, 2023. The Company assigns an internal risk rating to each syndicated loan in its portfolio ranging from 1 through 5, with 5 reflecting the lowest quality. For the nine months ended September 30, 2024, write-offs of syndicated loans were not material.
20


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The tables below present the amortized cost basis of syndicated loans by origination year and internal risk rating:
September 30, 2024
Internal Risk Rating20242023202220212020PriorTotal
(in millions)
Risk 5$ $ $ $ $ $ $ 
Risk 4       
Risk 3   5   5 
Risk 211 2 1 1  5 20 
Risk 111 3  2 1 3 20 
Total$22 $5 $1 $8 $1 $8 $45 
December 31, 2023
Internal Risk Rating20232022202120202019PriorTotal
(in millions)
Risk 5$ $ $ $ $ $ $ 
Risk 4       
Risk 3  7  1 1 9 
Risk 26 1 9 2 6  24 
Risk 16 2 9 1 5 1 24 
Total$12 $3 $25 $3 $12 $2 $57 
Policy Loans
Policy loans do not exceed the cash surrender value at origination. As there is minimal risk of loss related to policy loans, there is no allowance for credit losses.
Deposit Receivables
Deposit receivables were $6.0 billion and $6.5 billion as of September 30, 2024 and December 31, 2023, respectively. Deposit receivables are collateralized by the fair value of the assets held in trusts. Based on management’s evaluation of the collateral value relative to the deposit receivables, the allowance for credit losses for deposit receivables was not material as of both September 30, 2024 and December 31, 2023.
Modifications with Borrowers Experiencing Financial Difficulty
Modifications of financing receivables with borrowers experiencing financial difficulty by the Company were not material for the three and nine months ended September 30, 2024 and 2023.
7. Deferred Acquisition Costs and Deferred Sales Inducement Costs
The following tables summarize the balances of and changes in deferred acquisition costs (“DAC”):
Variable AnnuitiesStructured Variable AnnuitiesFixed AnnuitiesFixed Indexed AnnuitiesUniversal Life InsuranceVariable Universal Life Insurance
(in millions)
Balance at January 1, 2024
$1,481 $208 $35 $5 $110 $534 
Capitalization of acquisition costs17 75    48 
Amortization(88)(22)(5) (6)(34)
Balance at September 30, 2024
$1,410 $261 $30 $5 $104 $548 
Indexed Universal Life InsuranceOther Life InsuranceLife Contingent Payout AnnuitiesTerm and Whole Life Insurance
Disability Income Insurance
Total,
All Products
(in millions)
Balance at January 1, 2024
$223 $2 $6 $17 $75 $2,696 
Capitalization of acquisition costs2  3 1 3 149 
Amortization(12)  (1)(7)(175)
Balance at September 30, 2024
$213 $2 $9 $17 $71 $2,670 
21


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Variable AnnuitiesStructured Variable AnnuitiesFixed AnnuitiesFixed Indexed AnnuitiesUniversal Life InsuranceVariable Universal Life Insurance
(in millions)
Balance at January 1, 2023
$1,582 $149 $45 $6 $118 $521 
Capitalization of acquisition costs23 83    57 
Amortization(124)(24)(10)(1)(8)(44)
Balance at December 31, 2023
$1,481 $208 $35 $5 $110 $534 
Indexed Universal Life InsuranceOther Life InsuranceLife Contingent Payout AnnuitiesTerm and Whole Life Insurance
Disability Income Insurance
Total,
All Products
(in millions)
Balance at January 1, 2023
$236 $3 $2 $18 $79 $2,759 
Capitalization of acquisition costs4  4 1 4 176 
Amortization(17)(1) (2)(8)(239)
Balance at December 31, 2023
$223 $2 $6 $17 $75 $2,696 
The following tables summarize the balances of and changes in deferred sales inducement costs (“DSIC”):
Variable AnnuitiesFixed AnnuitiesTotal,
All Products
(in millions)
Balance at January 1, 2024
$134 $12 $146 
Amortization(10)(2)(12)
Balance at September 30, 2024
$124 $10 $134 
Variable AnnuitiesFixed AnnuitiesTotal,
All Products
(in millions)
Balance at January 1, 2023
$149 $16 $165 
Amortization(15)(4)(19)
Balance at December 31, 2023
$134 $12 $146 
8. Policyholder Account Balances, Future Policy Benefits and Claims
Policyholder account balances, future policy benefits and claims consisted of the following:
September 30, 2024
December 31, 2023
(in millions)
Policyholder account balances
Policyholder account balances$31,580 $27,947 
Future policy benefits
Reserve for future policy benefits7,855 7,763 
Deferred profit liability114 81 
Additional liabilities for insurance guarantees1,405 1,321 
Other insurance and annuity liabilities162 213 
Total future policy benefits9,536 9,378 
Policy claims and other policyholders’ funds207 210 
Total policyholder account balances, future policy benefits and claims$41,323 $37,535 
22


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Variable Annuities
Purchasers of variable annuities can select from a variety of investment options and can elect to allocate a portion to a fixed account. A vast majority of the premiums received for variable annuity contracts are held in separate accounts where the assets are held for the exclusive benefit of those contractholders.
Most of the variable annuity contracts issued by the Company contain a guaranteed minimum death benefit (“GMDB”). The Company previously offered contracts with guaranteed minimum accumulation benefit (“GMAB”), guaranteed minimum withdrawal benefit (“GMWB”), and guaranteed minimum income benefit (“GMIB”) provisions. See Note 10 for additional information regarding the Company’s variable annuity guarantees. See Note 12 and Note 14 for additional information regarding the Company’s derivative instruments used to hedge risks related to these guarantees.
Structured Variable Annuities
Structured variable annuities provide contractholders the option to allocate a portion of their account value to an indexed account held in a non-insulated separate account with the contractholder’s rate of return, which may be positive or negative, tied to selected indices. The amount allocated by a contractholder to the indexed account creates an embedded derivative which is measured at fair value. The Company hedges the equity and interest rate risk related to the indexed account with freestanding derivative instruments.
Fixed Annuities
Fixed annuities include deferred, payout and fixed deferred indexed annuity contracts. In 2020, the Company discontinued sales of fixed deferred and fixed deferred indexed annuities.
Deferred contracts offer a guaranteed minimum rate of interest and security of the principal invested. Payout contracts guarantee a fixed income payment for life or the term of the contract. Liabilities for fixed annuities in a benefit or payout status are based on future estimated payments using established industry mortality tables and interest rates.
The Company’s fixed index annuity product is a fixed annuity that includes an indexed account. The rate of interest credited above the minimum guarantee for funds allocated to the indexed account is linked to the performance of the specific index for the indexed account (subject to a cap). The amount allocated by a contractholder to the indexed account creates an embedded derivative which is measured at fair value.
See Note 14 for additional information regarding the Company’s derivative instruments used to hedge the risk related to indexed accounts.
Insurance Liabilities
Universal life (“UL”) policies accumulate cash value that increases by a fixed interest rate. Purchasers of variable universal life (“VUL”) can select from a variety of investment options and can elect to allocate a portion of their account balance to a fixed account or a separate account. A vast majority of the premiums received for VUL policies are held in separate accounts where the assets are held for the exclusive benefit of those policyholders.
Indexed universal life (“IUL”) is a UL policy that includes an indexed account. The rate of credited interest for funds allocated by a contractholder to the indexed account is linked to the performance of the specific index for the indexed account (subject to stated account parameters, which include a cap and floor, or a spread). The policyholder may allocate all or a portion of the policy value to a fixed or any available indexed account. The amount allocated by a contractholder to the indexed account creates an embedded derivative which is measured at fair value. The Company hedges the interest credited rate including equity and interest rate risk related to the indexed account with freestanding derivative instruments.
See Note 14 for additional information regarding the Company’s derivative instruments used to hedge the risk related to IUL.
The Company also offers term life insurance as well as disability income (“DI”) insurance products. The Company no longer offers standalone long term care (“LTC”) insurance products and whole life insurance but has in force policies from prior years.
Insurance liabilities include accumulation values, incurred but not reported claims, obligations for anticipated future claims, unpaid reported claims and claim adjustment expenses.
23


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The balances of and changes in policyholder account balances were as follows:
Variable AnnuitiesStructured Variable AnnuitiesFixed AnnuitiesFixed Indexed AnnuitiesNon-Life Contingent Payout Annuities
(in millions, except percentages)
Balance at January 1, 2024
$4,173 $10,742 $5,982 $307 $444 
Contract deposits39 3,040 30  80 
Policy charges(11)(2)   
Surrenders and other benefits(489)(271)(678)(11)(86)
Net transfer from (to) separate account liabilities(19)    
Variable account index-linked adjustments
 1,667    
Interest credited97  154 10 10 
Balance at September 30, 2024
$3,790 $15,176 $5,488 $306 $448 
Weighted-average crediting rate3.3 %1.8 %3.7 %2.0 %N/A
Cash surrender value (1)
$3,766 $14,441 $5,483 $284 N/A
Universal Life InsuranceVariable Universal Life InsuranceIndexed Universal Life InsuranceOther Life InsuranceTotal,
All Products
(in millions, except percentages)
Balance at January 1, 2024
$1,474 $1,569 $2,755 $501 $27,947 
Contract deposits87 248 134  3,658 
Policy charges(131)(69)(93) (306)
Surrenders and other benefits(47)(62)(62)(40)(1,746)
Net transfer from (to) separate account liabilities (105)  (124)
Variable account index-linked adjustments
    1,667 
Interest credited37 46 117 13 484 
Balance at September 30, 2024
$1,420 $1,627 $2,851 $474 $31,580 
Weighted-average crediting rate3.6 %3.9 %2.3 %4.0 %
Net amount at risk$8,425 $57,030 $13,804 $132 
Cash surrender value (1)
$1,291 $1,090 $2,395 $304 
24


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Variable AnnuitiesStructured Variable AnnuitiesFixed AnnuitiesFixed Indexed AnnuitiesNon-Life Contingent Payout Annuities
(in millions, except percentages)
Balance at January 1, 2023
$4,752 $6,410 $6,799 $312 $471 
Contract deposits73 3,084 47  91 
Policy charges(10)    
Surrenders and other benefits(759)(156)(1,086)(10)(127)
Net transfer from (to) separate account liabilities(25)    
Variable account index-linked adjustments
 1,403    
Interest credited142 1 222 5 9 
Balance at December 31, 2023
$4,173 $10,742 $5,982 $307 $444 
Weighted-average crediting rate3.3 %1.8 %3.6 %2.0 %N/A
Cash surrender value (1)
$4,146 $10,129 $5,974 $278 N/A
Universal Life InsuranceVariable Universal Life InsuranceIndexed Universal Life InsuranceOther Life InsuranceTotal,
All Products
(in millions, except percentages)
Balance at January 1, 2023
$1,544 $1,520 $2,654 $524 $24,986 
Contract deposits123 272 193 1 3,884 
Policy charges(176)(94)(121) (401)
Surrenders and other benefits(69)(78)(53)(44)(2,382)
Net transfer from (to) separate account liabilities (107)  (132)
Variable account index-linked adjustments
    1,403 
Interest credited52 56 82 20 589 
Balance at December 31, 2023
$1,474 $1,569 $2,755 $501 $27,947 
Weighted-average crediting rate3.6 %3.9 %2.0 %4.0 %
Net amount at risk$8,740 $57,291 $14,407 $141 
Cash surrender value (1)
$1,330 $1,065 $2,271 $326 
(1) Cash surrender value represents the amount of the contractholder's account balances distributable at the balance sheet date less certain surrender charges. For variable annuities and VUL, the cash surrender value shown is the proportion of the total cash surrender value related to their fixed account liabilities.
Refer to Note 10 for the net amount at risk for market risk benefits (“MRB”) associated with variable and structured variable annuities. Fixed, fixed indexed, and non-life contingent payout annuities do not have net amount at risk in excess of account value. Net amount at risk for insurance products is calculated as the death benefit amount in excess of applicable account values, host, embedded derivative, and separate account liabilities.
25


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables present the account values of fixed deferred annuities, fixed insurance, and the fixed portion of variable annuities and variable insurance contracts by range of guaranteed minimum interest rates (“GMIRs”) and the range of the difference between rates credited to policyholders and contractholders as of September 30, 2024 and December 31, 2023 and the respective guaranteed minimums, as well as the percentage of account values subject to rate reset in the time period indicated. Rates are reset at management’s discretion, subject to guaranteed minimums.
September 30, 2024
Account Values with Crediting Rates
Range of Guaranteed Minimum Crediting RatesAt Guaranteed Minimum
1-49 bps above Guaranteed Minimum
50-99 bps above Guaranteed Minimum
100-150 bps above Guaranteed Minimum
Greater than 150 bps above Guaranteed Minimum
Total
(in millions, except percentages)
Fixed accounts of variable annuities1 %1.99%$27 $99 $66 $17 $2 $211 
2 %2.99%119     119 
3 %3.99%1,958 7  1  1,966 
4 %5.00%1,436     1,436 
Total$3,540 $106 $66 $18 $2 $3,732 
Fixed accounts of structured variable annuities1 %1.99%$2 $23 $4 $1 $ $30 
2 %2.99%13     13 
3 %3.99%      
4 %5.00%      
Total$15 $23 $4 $1 $ $43 
Fixed annuities1 %1.99%$88 $250 $164 $113 $ $615 
2 %2.99%23 16 1   40 
3 %3.99%2,486     2,486 
4 %5.00%2,333     2,333 
Total$4,930 $266 $165 $113 $ $5,474 
Non-indexed accounts of fixed indexed annuities1 %1.99%$ $2 $6 $14 $ $22 
2 %2.99%      
3 %3.99%      
4 %5.00%      
Total$ $2 $6 $14 $ $22 
Universal life insurance1 %1.99%$ $ $ $ $ $ 
2 %2.99%49 5 13  1 68 
3 %3.99%830  4 5  839 
4 %5.00%482 3    485 
Total$1,361 $8 $17 $5 $1 $1,392 
26


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Account Values with Crediting Rates
Range of Guaranteed Minimum Crediting RatesAt Guaranteed Minimum
1-49 bps above Guaranteed Minimum
50-99 bps above Guaranteed Minimum
100-150 bps above Guaranteed Minimum
Greater than 150 bps above Guaranteed Minimum
Total
(in millions, except percentages)
Fixed accounts of variable universal life insurance1 %1.99%$ $ $5 $1 $37 $43 
2 %2.99%8 14  1 10 33 
3 %3.99%111 1 3 11  126 
4 %5.00%572 20    592 
Total$691 $35 $8 $13 $47 $794 
Non-indexed accounts of indexed universal life insurance1 %1.99%$ $ $ $2 $ $2 
2 %2.99% 128    128 
3 %3.99%      
4 %5.00%      
Total$ $128 $ $2 $ $130 
Other life insurance1 %1.99%$ $ $ $ $ $ 
2 %2.99%      
3 %3.99%29     29 
4 %5.00%274     274 
Total$303 $ $ $ $ $303 
Total1 %1.99%$117 $374 $245 $148 $39 $923 
2 %2.99%212 163 14 1 11 401 
3 %3.99%5,414 8 7 17  5,446 
4 %5.00%5,097 23    5,120 
Total$10,840 $568 $266 $166 $50 $11,890 
Percentage of total account values that reset in:
Next 12 months100.0 %100.0 %99.9 %100.0 %99.8 %100.0 %
> 12 months to 24 months      
> 24 months  0.1  0.2  
Total100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
December 31, 2023
Account Values with Crediting Rates
Range of Guaranteed Minimum Crediting RatesAt Guaranteed Minimum
1-49 bps above Guaranteed Minimum
50-99 bps above Guaranteed Minimum
100-150 bps above Guaranteed Minimum
Greater than 150 bps above Guaranteed Minimum
Total
(in millions, except percentages)
Fixed accounts of variable annuities1 %1.99%$43 $131 $52 $15 $2 $243 
2 %2.99%137 1    138 
3 %3.99%2,214   1  2,215 
4 %5.00%1,514     1,514 
Total$3,908 $132 $52 $16 $2 $4,110 
27


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Account Values with Crediting Rates
Range of Guaranteed Minimum Crediting RatesAt Guaranteed Minimum
1-49 bps above Guaranteed Minimum
50-99 bps above Guaranteed Minimum
100-150 bps above Guaranteed Minimum
Greater than 150 bps above Guaranteed Minimum
Total
(in millions, except percentages)
Fixed accounts of structured variable annuities1 %1.99%$1 $18 $7 $2 $ $28 
2 %2.99%11     11 
3 %3.99%      
4 %5.00%      
Total$12 $18 $7 $2 $ $39 
Fixed annuities1 %1.99%$107 $377 $183 $93 $ $760 
2 %2.99%36 14 1   51 
3 %3.99%2,816 1    2,817 
4 %5.00%2,339     2,339 
Total$5,298 $392 $184 $93 $ $5,967 
Non-indexed accounts of fixed indexed annuities1 %1.99%$ $2 $7 $13 $ $22 
2 %2.99%      
3 %3.99%      
4 %5.00%      
Total$ $2 $7 $13 $ $22 
Universal life insurance1 %1.99%$ $ $ $ $ $ 
2 %2.99%51 3 9   63 
3 %3.99%854 1 4 4  863 
4 %5.00%518 1    519 
Total$1,423 $5 $13 $4 $ $1,445 
Fixed accounts of variable universal life insurance1 %1.99%$ $2 $4 $ $24 $30 
2 %2.99%13 12  1 8 34 
3 %3.99%122 2 3 6  133 
4 %5.00%607 6    613 
Total$742 $22 $7 $7 $32 $810 
Non-indexed accounts of indexed universal life insurance1 %1.99%$ $ $2 $ $ $2 
2 %2.99%128     128 
3 %3.99%      
4 %5.00%      
Total$128 $ $2 $ $ $130 
28


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Account Values with Crediting Rates
Range of Guaranteed Minimum Crediting RatesAt Guaranteed Minimum
1-49 bps above Guaranteed Minimum
50-99 bps above Guaranteed Minimum
100-150 bps above Guaranteed Minimum
Greater than 150 bps above Guaranteed Minimum
Total
(in millions, except percentages)
Other life insurance1 %1.99%$ $ $ $ $ $ 
2 %2.99%      
3 %3.99%30     30 
4 %5.00%295     295 
Total$325 $ $ $ $ $325 
Total1 %1.99%$151 $530 $255 $123 $26 $1,085 
2 %2.99%376 30 10 1 8 425 
3 %3.99%6,036 4 7 11  6,058 
4 %5.00%5,273 7    5,280 
Total$11,836 $571 $272 $135 $34 $12,848 
Percentage of total account values that reset in:
Next 12 months99.9 %99.5 %99.3 %100.0 %100.0 %99.9 %
> 12 months to 24 months0.1 0.5 0.6   0.1 
> 24 months  0.1    
Total100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
29


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables summarize the balances of and changes in the liability for future policy benefits:
Life Contingent Payout AnnuitiesTerm and Whole Life Insurance
Disability Income Insurance
Long Term Care InsuranceTotal,
All Products
(in millions, except percentages)
Present Value of Expected Net Premiums:
Balance at January 1, 2024
$ $703 $104 $1,146 $1,953 
Beginning balance at original discount rate 708 105 1,137 1,950 
Effect of changes in cash flow assumptions 57 (39)55 73 
Effect of actual variances from expected experience (8)(10)(19)(37)
Adjusted beginning of year balance$ $757 $56 $1,173 $1,986 
Issuances166 46 6  218 
Interest accrual 28 4 41 73 
Net premiums collected(166)(56)(6)(111)(339)
Derecognition (lapses)     
Ending balance at original discount rate$ $775 $60 $1,103 $1,938 
Effect of changes in discount rate assumptions 2 (3)24 23 
Balance at September 30, 2024
$ $777 $57 $1,127 $1,961 
Present Value of Future Policy Benefits:
Balance at January 1, 2024
$1,164 $1,325 $661 $6,561 $9,711 
Beginning balance at original discount rate1,222 1,291 621 6,507 9,641 
Effect of changes in cash flow assumptions(24)67 (61)58 40 
Effect of actual variances from expected experience(7)(6)(19)(31)(63)
Adjusted beginning of year balance$1,191 $1,352 $541 $6,534 $9,618 
Issuances166 46 6  218 
Interest accrual42 55 26 243 366 
Benefit payments(118)(98)(31)(322)(569)
Derecognition (lapses)     
Ending balance at original discount rate$1,281 $1,355 $542 $6,455 $9,633 
Effect of changes in discount rate assumptions(34)43 40 127 176 
Balance at September 30, 2024
$1,247 $1,398 $582 $6,582 $9,809 
Adjustment due to reserve flooring$ $7 $ $ $7 
Net liability for future policy benefits$1,247 $628 $525 $5,455 $7,855 
Less: reinsurance recoverable810 447 22 2,753 4,032 
Net liability for future policy benefits, after reinsurance recoverable$437 $181 $503 $2,702 $3,823 
Discounted expected future gross premiums$ $1,779 $881 $1,320 $3,980 
Expected future gross premiums$ $2,950 $1,213 $1,753 $5,916 
Expected future benefit payments$1,830 $2,287 $912 $10,650 $15,679 
Weighted average interest accretion rate4.5 %6.1 %6.4 %5.1 %
Weighted average discount rate4.8 %4.9 %4.9 %5.0 %
Weighted average duration of liability (in years)7788
30


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Life Contingent Payout AnnuitiesTerm and Whole Life Insurance
Disability Income Insurance
Long Term Care InsuranceTotal,
All Products
(in millions, except percentages)
Present Value of Expected Net Premiums:
Balance at January 1, 2023
$ $686 $134 $1,207 $2,027 
Beginning balance at original discount rate 708 137 1,220 2,065 
Effect of changes in cash flow assumptions (19)(19)19 (19)
Effect of actual variances from expected experience (2)(18)(3)(23)
Adjusted beginning of year balance$ $687 $100 $1,236 $2,023 
Issuances177 55 12  244 
Interest accrual1 36 5 59 101 
Net premiums collected(178)(70)(12)(158)(418)
Derecognition (lapses)     
Ending balance at original discount rate$ $708 $105 $1,137 $1,950 
Effect of changes in discount rate assumptions (5)(1)9 3 
Balance at December 31, 2023
$ $703 $104 $1,146 $1,953 
Present Value of Future Policy Benefits:
Balance at January 1, 2023
$1,065 $1,319 $696 $6,439 $9,519 
Beginning balance at original discount rate1,155 1,313 669 6,569 9,706 
Effect of changes in cash flow assumptions (18)(25)9 (34)
Effect of actual variances from expected experience(10)(1)(29)5 (35)
Adjusted beginning of year balance$1,145 $1,294 $615 $6,583 $9,637 
Issuances177 56 11  244 
Interest accrual50 73 37 329 489 
Benefit payments(150)(132)(42)(405)(729)
Derecognition (lapses)     
Ending balance at original discount rate$1,222 $1,291 $621 $6,507 $9,641 
Effect of changes in discount rate assumptions(58)34 40 54 70 
Balance at December 31, 2023
$1,164 $1,325 $661 $6,561 $9,711 
Adjustment due to reserve flooring$ $5 $ $ $5 
Net liability for future policy benefits$1,164 $627 $557 $5,415 $7,763 
Less: reinsurance recoverable880 440 22 2,738 4,080 
Net liability for future policy benefits, after reinsurance recoverable$284 $187 $535 $2,677 $3,683 
Discounted expected future gross premiums$ $1,764 $904 $1,325 $3,993 
Expected future gross premiums$ $2,938 $1,269 $1,786 $5,993 
Expected future benefit payments$1,726 $2,166 $1,068 $10,850 $15,810 
Weighted average interest accretion rate4.2 %6.2 %6.1 %5.0 %
Weighted average discount rate4.9 %5.1 %5.1 %5.1 %
Weighted average duration of liability (in years)7788
31


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Impacts of the annual review of policy benefit reserves assumptions are reflected within the effect of changes in cash flow assumptions in the disaggregated rollforwards above. The annual review of policy benefit reserves assumptions in the third quarter of 2024 resulted in a net decrease in future policy benefit reserves, primarily due to decreased disability income insurance claim incidence rates. The annual review of policy benefit reserves assumptions in the third quarter of 2023 resulted in a net decrease in future policy benefit reserves, primarily due to updates to LTC premium rate increase assumptions.
The balances of and changes in additional liabilities related to insurance guarantees were as follows:
Universal Life InsuranceVariable Universal Life InsuranceOther Life InsuranceTotal,
All Products
(in millions, except percentages)
Balance at January 1, 2024
$1,225 $81 $15 $1,321 
Interest accrual28 5  33 
Benefit accrual99 6 3 108 
Benefit payments(47)(10)(3)(60)
Effect of actual variances from expected experience (2)(1)(3)
Impact of change in net unrealized (gains) losses on securities5  1 6 
Balance at September 30, 2024
$1,310 $80 $15 $1,405 
Weighted average interest accretion rate3.0 %7.1 %3.9 %
Weighted average discount rate3.2 %7.1 %4.0 %
Weighted average duration of reserves (in years)1086
Universal Life InsuranceVariable Universal Life InsuranceOther Life InsuranceTotal,
All Products
(in millions, except percentages)
Balance at January 1, 2023
$1,100 $74 $12 $1,186 
Interest accrual35 5 1 41 
Benefit accrual128 8 2 138 
Benefit payments(50)(18)(4)(72)
Effect of actual variances from expected experience(13)11 (2)(4)
Impact of change in net unrealized (gains) losses on securities25 1 6 32 
Balance at December 31, 2023
$1,225 $81 $15 $1,321 
Weighted average interest accretion rate3.0 %6.9 %4.0 %
Weighted average discount rate3.2 %7.1 %4.0 %
Weighted average duration of reserves (in years)1086
The amount of revenue and interest recognized in the Statements of Income was as follows:
Nine Months Ended September 30,
2024
Gross PremiumsInterest Expense
(in millions)
Life contingent payout annuities$185 $42 
Term and whole life insurance129 27 
Disability income insurance
90 22 
Long term care insurance132 202 
Total$536 $293 
32


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Year Ended December 31,
2023
Gross PremiumsInterest Expense
(in millions)
Life contingent payout annuities$196 $49 
Term and whole life insurance169 37 
Disability income insurance
124 32 
Long term care insurance185 270 
Total$674 $388 
The following tables summarize the balances of and changes in unearned revenue:
Universal Life InsuranceVariable Universal Life InsuranceIndexed Universal Life InsuranceTotal,
All Products
(in millions)
Balance at January 1, 2024
$27 $196 $266 $489 
Deferral of revenue 52 38 90 
Amortization(1)(12)(16)(29)
Balance at September 30, 2024
$26 $236 $288 $550 
Balance at January 1, 2023
$27 $150 $233 $410 
Deferral of revenue1 59 52 112 
Amortization(1)(13)(19)(33)
Balance at December 31, 2023
$27 $196 $266 $489 
9.  Separate Account Assets and Liabilities
The fair value of separate account assets is invested exclusively in mutual funds.
The balances of and changes in separate account liabilities were as follows:
Variable AnnuitiesVariable Universal LifeTotal
(in millions)
Balance at January 1, 2024
$65,839 $8,795 $74,634 
Premiums and deposits676 365 1,041 
Policy charges(1,017)(229)(1,246)
Surrenders and other benefits(5,111)(317)(5,428)
Investment return8,281 1,288 9,569 
Net transfer from (to) general account18 43 61 
Balance at September 30, 2024
$68,686 $9,945 $78,631 
Cash surrender value$67,277 $9,342 $76,619 
33


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Variable AnnuitiesVariable Universal LifeTotal
(in millions)
Balance at January 1, 2023
$63,223 $7,653 $70,876 
Premiums and deposits835 459 1,294 
Policy charges(1,343)(292)(1,635)
Surrenders and other benefits(5,378)(317)(5,695)
Investment return8,477 1,250 9,727 
Net transfer from (to) general account25 42 67 
Balance at December 31, 2023
$65,839 $8,795 $74,634 
Cash surrender value$64,280 $8,263 $72,543 
10. Market Risk Benefits
Market risk benefits are contracts or contract features that both provide protection to the contractholder from other-than-nominal capital market risk and expose the Company to other-than-nominal capital market risk. Most of the variable annuity contracts issued by the Company contain a GMDB provision. The Company previously offered contracts containing GMWB, GMAB, or GMIB provisions.
The GMDB provisions provide a specified minimum return upon death of the contractholder. The death benefit payable is the greater of (i) the contract value less any purchase payment credits subject to recapture less a pro-rata portion of any rider fees, or (ii) the GMDB provisions specified in the contract. The Company has the following primary GMDB provisions:
Return of premium — provides purchase payments minus adjusted partial surrenders.
Reset — provides that the value resets to the account value at specified contract anniversary intervals minus adjusted partial surrenders. This provision was often provided in combination with the return of premium provision and is no longer offered.
Ratchet — provides that the value ratchets up to the maximum account value at specified anniversary intervals, plus subsequent purchase payments less adjusted partial surrenders.
The variable annuity contracts with GMWB riders typically have account values that are based on an underlying portfolio of mutual funds, the values of which fluctuate based on fund performance. At contract issue, the guaranteed amount is equal to the amount deposited but the guarantee may be increased annually to the account value (a “step-up”) in the case of favorable market performance or by a benefit credit if the contract includes this provision.
The Company has GMWB riders in force, which contain one or more of the following provisions:
Withdrawals at a specified rate per year until the amount withdrawn is equal to the guaranteed amount.
Withdrawals at a specified rate per year for the life of the contractholder (“GMWB for life”).
Withdrawals at a specified rate per year for joint contractholders while either is alive.
Withdrawals based on performance of the contract.
Withdrawals based on the age withdrawals begin.
Credits are applied annually for a specified number of years to increase the guaranteed amount as long as withdrawals have not been taken.
Variable annuity contractholders age 79 or younger at contract issue could obtain a principal-back guarantee by purchasing the optional GMAB rider for an additional charge. The GMAB rider guarantees that, regardless of market performance at the end of the 10-year waiting period, the contract value will be no less than the original investment or a specified percentage of the highest anniversary value, adjusted for withdrawals. If the contract value is less than the guarantee at the end of the 10-year period, a lump sum will be added to the contract value to make the contract value equal to the guarantee value.
Individual variable annuity contracts may have both a death benefit and a living benefit. Net amount at risk is quantified for each benefit and a composite net amount at risk is calculated using the greater of the death benefit or living benefit for each individual contract. The net amount at risk for GMDB and GMAB is defined as the current guaranteed benefit amount in excess of the current contract value. The net amount at risk for GMIB is defined as the greater of the present value of the minimum guaranteed annuity payments less the current contract value or zero. The net amount at risk for GMWB is defined as the greater of the present value of the minimum guaranteed withdrawal payments less the current contract value or zero.
34


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables summarize the balances of and changes in market risk benefits:
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
(in millions, except age)
Balance at beginning of period$(830)$360 $335 $1,103 
Issuances6 5 18 13 
Interest accrual and time decay(10)(15)(35)(36)
Reserve increase from attributed fees collected206 202 585 585 
Reserve release for benefit payments and derecognition(2)(6)(9)(24)
Effect of changes in interest rates and bond markets616 (1,241)(156)(1,325)
Effect of changes in equity markets and subaccount performance(400)500 (1,282)(402)
Effect of changes in equity index volatility8 (13)62 (83)
Actual policyholder behavior different from expected behavior7 (16)48 (10)
Effect of changes in other future expected assumptions106 128 106 128 
Effect of changes in the instrument-specific credit risk on market risk benefits63 (23)98 (68)
Balance at end of period$(230)$(119)$(230)$(119)
Reconciliation of the gross balances in an asset or liability position:
Asset position$1,809 $1,644 $1,809 $1,644 
Liability position(1,579)(1,525)(1,579)(1,525)
Net asset (liability) position$230 $119 $230 $119 
Guaranteed benefit amount in excess of current account balances (net amount at risk):
Death benefits$343 $2,091 $343 $2,091 
Living benefits$1,867 $3,693 $1,867 $3,693 
Composite (greater of)$2,177 $5,470 $2,177 $5,470 
Weighted average attained age of contractholders69696969
Changes in unrealized (gains) losses in net income relating to liabilities held at end of period $312 $(650)$(1,250)$(1,681)
Changes in unrealized (gains) losses in other comprehensive income relating to liabilities held at end of period $62 $(23)$102 $(67)
35


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Year Ended December 31,
2023
(in millions, except age)
Balance at beginning of period$1,103 
Issuances17 
Interest accrual and time decay(53)
Reserve increase from attributed fees collected788 
Reserve release for benefit payments and derecognition(35)
Effect of changes in interest rates and bond markets(367)
Effect of changes in equity markets and subaccount performance(1,267)
Effect of changes in equity index volatility(67)
Actual policyholder behavior different from expected behavior5 
Effect of changes in other future expected assumptions128 
Effect of changes in the instrument-specific credit risk on market risk benefits83 
Balance at end of period$335 
Reconciliation of the gross balances in an asset or liability position:
Asset position$1,427 
Liability position(1,762)
Net asset (liability) position$(335)
Guaranteed benefit amount in excess of current account balances (net amount at risk):
Death benefits$913 
Living benefits$2,513 
Composite (greater of)$3,308 
Weighted average attained age of contractholders69
Changes in unrealized (gains) losses in net income relating to liabilities held at end of period$(1,551)
Changes in unrealized (gains) losses in other comprehensive income relating to liabilities held at end of period$84 

The following tables provide a summary of the significant inputs and assumptions used in the fair value measurements developed by the Company or reasonably available to the Company of market risk benefits:
September 30, 2024
Fair ValueValuation TechniqueSignificant Inputs and AssumptionsRangeWeighted
 Average
(in millions)
Market risk benefits$(230)Discounted cash flow
Utilization of guaranteed withdrawals (1)
0.0%52.8%11.9%
Surrender rate (2)
0.4%75.0%3.3%
Market volatility (3)
0.0%25.5%10.7%
Nonperformance risk (4)
70 bps70 bps
Mortality rate (5)
0.0%41.6%1.7%
36


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
December 31, 2023
Fair ValueValuation TechniqueSignificant Inputs and AssumptionsRangeWeighted
 Average
(in millions)
Market risk benefits$335 Discounted cash flow
Utilization of guaranteed withdrawals (1)
0.0%48.0%11.6%
Surrender rate (2)
0.3%75.0%3.7%
Market volatility (3)
0.0%25.2%10.6%
Nonperformance risk (4)
85 bps85 bps
Mortality rate (5)
0.0%41.6%1.6%
(1) The utilization of guaranteed withdrawals represents the percentage of contractholders that will begin withdrawing in any given year. The weighted average utilization rate represents the average assumption, weighted based on the benefit base. The calculation excludes policies that have already started taking withdrawals.
(2) The weighted average surrender rate represents the average assumption weighted based on the account value of each contract.
(3) Market volatility represents the implied volatility of each contractholder’s mix of funds. The weighted average market volatility represents the average volatility across all contracts, weighted by the size of the guaranteed benefit.
(4) The nonperformance risk is the spread added to the U.S. Treasury curve.
(5) The weighted average mortality rate represents the average assumption weighted based on the account value of each contract.
Changes to Significant Inputs and Assumptions:
During the nine months ended September 30, 2024 and year ended December 31, 2023, the Company updated inputs and assumptions based on management’s review of experience studies. These updates resulted in the following notable changes in the fair value estimates of market risk benefits calculations:
Nine months ended September 30, 2024
Updates to utilization of guaranteed withdrawal assumptions resulted in a decrease to pre-tax income of $15 million.
Updates to surrender assumptions resulted in a decrease to pre-tax income of $83 million.
Year ended December 31, 2023
Updates to utilization of guaranteed withdrawal assumptions resulted in a decrease to pre-tax income of $18 million.
Updates to surrender assumptions resulted in a decrease to pre-tax income of $110 million.
Refer to the rollforward of market risk benefits for the impacts of changes to interest rate, equity market, volatility and nonperformance risk assumptions.
Uncertainty of Fair Value Measurements
Significant increases (decreases) in utilization and volatility used in the fair value measurement of market risk benefits in isolation would have resulted in a significantly higher (lower) liability value.
Significant increases (decreases) in nonperformance risk and surrender assumptions used in the fair value measurement of market risk benefits in isolation would have resulted in a significantly lower (higher) liability value.
Significant increases (decreases) in mortality assumptions used in the fair value measurement of the death benefit portion of market risk benefits in isolation would have resulted in a significantly higher (lower) liability value whereas significant increases (decreases) in mortality rates used in the fair value measurement of the life contingent portion of market risk benefits in isolation would have resulted in a significantly lower (higher) liability value.
Surrender assumptions, utilization assumptions and mortality assumptions vary with the type of base product, type of rider, duration of the policy, age of the contractholder, calendar year of the projection, previous withdrawal history, and the relationship between the value of the guaranteed benefit and the contract accumulation value.
Determination of Fair Value
The Company values market risk benefits using internal valuation models. These models include observable capital market assumptions and significant unobservable inputs related to implied volatility, contractholder behavior assumptions that include margins for risk, and the Company’s nonperformance risk. These measurements are classified as Level 3.
11. Debt
Short-Term Borrowings
RiverSource Life Insurance Company is a member of the Federal Home Loan Bank (“FHLB”) of Des Moines which provides access to collateralized borrowings. The Company has accessed collateralized borrowings from the FHLB and has pledged (granted a lien on) certain investments as collateral, primarily commercial mortgage backed securities and residential mortgage backed securities, with an
37


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
aggregate fair value of $997 million and $1.1 billion as of September 30, 2024 and December 31, 2023, respectively. The amount of the Company’s liability including accrued interest was $201 million as of both September 30, 2024 and December 31, 2023. The remaining maturity of outstanding FHLB advances was less than three months as of both September 30, 2024 and December 31, 2023. The weighted average annualized interest rate on the FHLB advances held as of September 30, 2024 and December 31, 2023 was 5.3% and 5.6%, respectively.
Long-Term Debt
The Company has a $500 million unsecured 3.5% surplus note due December 31, 2050 to Ameriprise Financial. The outstanding balance was $500 million as of both September 30, 2024 and December 31, 2023 and is recorded in Long-term debt.
12. Fair Values of Assets and Liabilities
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; that is, an exit price. The exit price assumes the asset or liability is not exchanged subject to a forced liquidation or distressed sale.
Valuation Hierarchy
The Company categorizes its fair value measurements according to a three-level hierarchy. The hierarchy prioritizes the inputs used by the Company’s valuation techniques. A level is assigned to each fair value measurement based on the lowest level input that is significant to the fair value measurement in its entirety.
The three levels of the fair value hierarchy are defined as follows:
Level 1    Unadjusted quoted prices for identical assets or liabilities in active markets that are accessible at the measurement date.
Level 2    Prices or valuations based on observable inputs other than quoted prices in active markets for identical assets and liabilities.
Level 3    Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
38


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables present the balances of assets and liabilities measured at fair value on a recurring basis (See Note 4 for the balances of assets and liabilities for consolidated investment entities):
 
September 30, 2024
 
Level 1Level 2Level 3Total
(in millions)
Assets     
Available-for-Sale securities:    

Corporate debt securities$ $12,415 $565 $12,980  
Residential mortgage backed securities 3,990 14 4,004  
Commercial mortgage backed securities 2,229  2,229  
State and municipal obligations 685  685  
Asset backed securities 1,267 898 2,165  
Foreign government bonds and obligations 7  7  
U.S. government and agency obligations1   1  
Total Available-for-Sale securities1 20,593 1,477 22,071  
Cash equivalents912 2,214  3,126  
Market risk benefits  1,809 1,809 (1)
Receivables:
,
Fixed deferred indexed annuity ceded embedded derivatives  55 55 
Other assets:  
Interest rate derivative contracts3 240  243  
Equity derivative contracts132 8,070  8,202  
Foreign exchange derivative contracts2 27  29  
Total other assets137 8,337  8,474  
Separate account assets at net asset value (“NAV”)78,631 (2)
Total assets at fair value$1,050 $31,144 $3,341 $114,166  
Liabilities
Policyholder account balances, future policy benefits and claims:
Fixed deferred indexed annuity embedded derivatives$ $ $54 $54  
IUL embedded derivatives  943 943  
Structured variable annuity embedded derivatives  2,317 2,317 
Total policyholder account balances, future policy benefits and claims  3,314 3,314 (3)
Market risk benefits  1,579 1,579 (1)
Other liabilities:
Interest rate derivative contracts1 256  257 
Equity derivative contracts147 5,301  5,448  
Foreign exchange derivative contracts 3  3  
Credit derivative contracts 32  32  
Total other liabilities148 5,592  5,740 
Total liabilities at fair value$148 $5,592 $4,893 $10,633  


39


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
 December 31, 2023 
Level 1Level 2Level 3Total
(in millions)
Assets     
Available-for-Sale securities:     
Corporate debt securities$ $10,283 $452 $10,735  
Residential mortgage backed securities 3,642  3,642  
Commercial mortgage backed securities 2,597  2,597  
State and municipal obligations 758  758  
Asset backed securities 976 555 1,531  
Foreign government bonds and obligations 12  12  
U.S. government and agency obligations99   99  
Total Available-for-Sale securities99 18,268 1,007 19,374  
Cash equivalents558 2,012  2,570  
Market risk benefits  1,427 1,427 (1)
Receivables:
Fixed deferred indexed annuity ceded embedded derivatives  51 51 
Other assets:     
Interest rate derivative contracts1 184  185  
Equity derivative contracts65 4,945  5,010  
Foreign exchange derivative contracts1 20  21  
Credit derivative contracts 1  1 
Total other assets67 5,150  5,217  
Separate account assets at NAV74,634 (2)
Total assets at fair value$724 $25,430 $2,485 $103,273  
Liabilities
Policyholder account balances, future policy benefits and claims:
Fixed deferred indexed annuity embedded derivatives$ $3 $49 $52 
IUL embedded derivatives  873 873 
Structured variable annuity embedded derivatives  1,011 1,011 
Total policyholder account balances, future policy benefits and claims 3 1,933 1,936 
(3)
Market risk benefits  1,762 1,762 (1)
Other liabilities:
Interest rate derivative contracts1 304  305 
Equity derivative contracts95 3,355  3,450 
Foreign exchange derivative contracts1 3  4 
Credit derivative contracts 106  106 
Total other liabilities97 3,768  3,865 
Total liabilities at fair value$97 $3,771 $3,695 $7,563 
(1) See Note 10 for additional information related to market risk benefits, including the balances of and changes in market risk benefits as well as the significant inputs and assumptions used in the fair value measurements of market risk benefits.
(2) Amounts are comprised of financial instruments that are measured at fair value using the NAV per share (or its equivalent) as a practical expedient and have not been classified in the fair value hierarchy.
(3) The Company’s adjustment for nonperformance risk resulted in a $219 million and $195 million cumulative decrease to the embedded derivatives as of September 30, 2024 and December 31, 2023, respectively.


40


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following tables provide a summary of changes in Level 3 assets and liabilities measured at fair value on a recurring basis:
 Available-for-Sale SecuritiesReceivables
Corporate Debt SecuritiesResidential Mortgage Backed SecuritiesAsset Backed SecuritiesTotal
Fixed Deferred Indexed Annuity Ceded Embedded Derivatives
(in millions)
Balance at July 1, 2024
$531 $24$893 $1,448 $55 
Total gains (losses) included in:
Net income   (1)1 
Other comprehensive income (loss)17 1 28 46  
Purchases44 14  58  
Settlements(27)(1) (28)(1)
Transfers out of Level 3 (24)(23)(47) 
Balance at September 30, 2024
$565 $14 $898 $1,477 $55 
Changes in unrealized gains (losses) in other comprehensive income (loss) relating to assets held at September 30, 2024
$16 $$28 $44 $ 
Policyholder Account Balances, Future Policy Benefits and Claims
Fixed Deferred Indexed Annuity Embedded DerivativesIUL Embedded DerivativesStructured Variable Annuity Embedded DerivativesTotal
(in millions)
Balance at July 1, 2024
$52 $944 $1,896 $2,892 
Total (gains) losses included in:
Net income3 (2)36 (2)487 (3)526 
Issues 3 23 26 
Settlements(1)(40)(89)(130)
Balance at September 30, 2024
$54 $943 $2,317 $3,314 
Changes in unrealized (gains) losses in net income relating to liabilities held at September 30, 2024
$ $36 (2)$487 (3)$523 
41


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
 Available-for-Sale SecuritiesReceivables
Corporate Debt SecuritiesAsset Backed SecuritiesTotalFixed Deferred Indexed Annuity Ceded Embedded Derivatives
(in millions)
Balance at July 1, 2023
$433 $545 $978 $49 
Total gains (losses) included in:
Net income(1) (1)(1) 
Other comprehensive income (loss)(3)(5)(8) 
Purchases30  30  
Settlements(16) (16)(1)
Balance at September 30, 2023
$443 $540 $983 $48 
Changes in unrealized gains (losses) in net income relating to assets held at September 30, 2023
$(1)$ $(1)(1)$ 
Changes in unrealized gains (losses) in other comprehensive income (loss) relating to assets held at September 30, 2023
$(4)$(5)$(9)$ 
 Policyholder Account Balances, Future Policy Benefits and Claims
Fixed Deferred Indexed Annuity Embedded DerivativesIUL Embedded DerivativesStructured Variable Annuity Embedded DerivativesTotal
 (in millions)
Balance at July 1, 2023
$46 $809 $557 $1,412 
Total (gains) losses included in:
Net income (2)2 (2)(246)(3)(244)
Issues 6 35 41 
Settlements(1)(30)(46)(77)
Balance at September 30, 2023
$45 $787 $300 $1,132 
Changes in unrealized (gains) losses in net income relating to liabilities held at September 30, 2023
$ $2 (2)$(246)(3)$(244)
 Available-for-Sale SecuritiesReceivables
Corporate Debt SecuritiesResidential Mortgage Backed SecuritiesAsset Backed SecuritiesTotalFixed Deferred Indexed Annuity Ceded Embedded Derivatives
(in millions)
Balance at January 1, 2024
$452 $ $555 $1,007 $51 
Total gains (losses) included in:
Net income    (1)7 
Other comprehensive income (loss)14 1 33 48  
Purchases146 64 333 543  
Settlements(47)(2) (49)(3)
Transfers out of Level 3 (49)(23)(72) 
Balance at September 30, 2024
$565 $14 $898 $1,477 $55 
Changes in unrealized gains (losses) in other comprehensive income (loss) relating to assets held at September 30, 2024
$13 $ $33 $46 $ 
42


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Policyholder Account Balances, Future Policy Benefits and Claims
Fixed Deferred Indexed Annuity Embedded DerivativesIUL Embedded DerivativesStructured Variable Annuity Embedded DerivativesTotal
(in millions)
Balance at January 1, 2024
$49 $873 $1,011 $1,933 
Total (gains) losses included in:   
Net income8 (2)169 (2)1,440 (3)1,617 
Issues 17 99 116 
Settlements(3)(116) (233) (352)
Balance at September 30, 2024
$54 $943 $2,317 $3,314 
Changes in unrealized (gains) losses in net income relating to liabilities held at September 30, 2024
$ $169 (2)$1,440 (3)$1,609 
 Available-for-Sale SecuritiesReceivables
Corporate Debt SecuritiesAsset Backed SecuritiesTotalFixed Deferred Indexed Annuity Ceded Embedded Derivatives
(in millions)
Balance at January 1, 2023
$395 $545 $940 $48 
Total gains (losses) included in:
Net income(1) (1)(1)2 
Other comprehensive income (loss)(2)(5)(7) 
Purchases105  105  
Settlements(54) (54)(2)
Balance at September 30, 2023
$443 $540 $983 $48 
Changes in unrealized gains (losses) in net income relating to assets held at September 30, 2023
$(1)$ $(1)(1)$ 
Changes in unrealized gains (losses) in other comprehensive income (loss) relating to assets held at September 30, 2023
$(2)$(5)$(7)$ 
 Policyholder Account Balances, Future Policy Benefits and Claims
Fixed Deferred Indexed Annuity Embedded DerivativesIUL Embedded DerivativesStructured Variable Annuity Embedded DerivativesTotal
 (in millions)
Balance at January 1, 2023
$44 $739 $(137)(4)$646 
Total (gains) losses included in: 
Net income3 (2)94 (2)443 (3)540 
Issues 46 66 112 
Settlements(2)(92)(72)(166)
Balance at September 30, 2023
$45 $787 $300 $1,132 
Changes in unrealized (gains) losses in net income relating to liabilities held at September 30, 2023
$ $94 (2)$443 (3)$537 
(1) Included in Net investment income.
(2) Included in Interest credited to fixed accounts.
(3) Included in Benefits, claims, losses and settlement expenses.
(4) The fair value of the structured variable annuity embedded derivatives was a net asset as of January 1, 2023 and the amount is presented as a contra liability.
43


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The increase (decrease) to pretax income of the Company’s adjustment for nonperformance risk on the fair value of its embedded derivatives was $1 million and $(17) million, net of the reinsurance accrual, for the three months ended September 30, 2024 and 2023, respectively.
The increase (decrease) to pretax income of the Company’s adjustment for nonperformance risk on the fair value of its embedded derivatives was $20 million and $44 million, net of the reinsurance accrual, for the nine months ended September 30, 2024 and 2023, respectively.
Securities transferred from Level 3 primarily represent securities with fair values that are now obtained from a third-party pricing service with observable inputs or fair values that were included in an observable transaction with a market participant. Securities transferred to Level 3 represent securities with fair values that are now based on a single non-binding broker quote.
The following tables provide a summary of the significant unobservable inputs used in the fair value measurements developed by the Company or reasonably available to the Company of Level 3 assets and liabilities:
 
September 30, 2024
Fair ValueValuation TechniqueUnobservable InputRangeWeighted Average
(in millions)
Corporate debt securities (private placements)$565 
Discounted cash flow
Yield/spread to U.S. Treasuries (1)
0.9%1.9%1.2%
Asset backed securities$898 Discounted cash flow
Annual default rate (2)
2.1%4.0%3.3%
Loss severity25.0%25.0%
Constant prepayment rate (2)
0.0%1.0%0.4%
Yield/spread to U.S. Treasuries (3)
210 bps400 bps227 bps
Fixed deferred indexed annuity ceded embedded derivatives$55 Discounted cash flow
Surrender rate (4)
0.0%66.8%4.5%
Fixed deferred indexed annuity embedded derivatives$54 Discounted cash flow
Surrender rate (4)
0.0%66.8%4.5%
Nonperformance risk (5)
70 bps70 bps
IUL embedded derivatives$943 Discounted cash flow
Nonperformance risk (5)
70 bps70 bps
Structured variable annuity embedded derivatives
$2,317 Discounted cash flow
Surrender rate (4)
0.5%75.0%1.6%
Nonperformance risk (5)
70 bps70 bps
 December 31, 2023
Fair ValueValuation TechniqueUnobservable InputRangeWeighted Average
(in millions)
Corporate debt securities (private placements)$451 Discounted cash flow
Yield/spread to U.S. Treasuries (1)
1.0%2.4%1.2%
Asset backed securities$555 Discounted cash flowAnnual default rate3.1%3.1%
Loss severity25.0%25.0%
Yield/spread to U.S. Treasuries (3)
275 bps515 bps284 bps
Fixed deferred indexed annuity ceded embedded derivatives$51 Discounted cash flow
Surrender rate (4)
0.0%66.8%1.4%
Fixed deferred indexed annuity embedded derivatives$49 Discounted cash flow
Surrender rate (4)
0.0%66.8%1.4%
Nonperformance risk (5)
85 bps85 bps
IUL embedded derivatives$873 Discounted cash flow
Nonperformance risk (5)
85 bps85 bps
Structured variable annuity embedded derivatives$1,011 Discounted cash flow
Surrender rate (4)
0.5%75.0%2.6%
Nonperformance risk (5)
85 bps85 bps
(1) The weighted average for the yield/spread to U.S. Treasuries for corporate debt securities (private placements) is weighted based on the security’s market value as a percentage of the aggregate market value of the securities.
(2) The weighted average for both the annual default rate and the constant prepayment rate for asset backed securities are weighted based on the balances of each security.
(3) The weighted average for the yield/spread to U.S. Treasuries for asset backed securities is calculated as the sum of each tranche’s balance multiplied by its spread to U.S. Treasuries divided by the aggregate balances of the tranches.
44


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
(4) The weighted average surrender rate represents the average assumption weighted based on the account value of each contract.
(5) The nonperformance risk is the spread added to the U.S. Treasury curve.
Level 3 measurements not included in the tables above are obtained from non-binding broker quotes where unobservable inputs utilized in the fair value calculation are not reasonably available to the Company or fair values estimated based on a transaction near the balance sheet date.
Uncertainty of Fair Value Measurements
Significant increases (decreases) in the yield/spread to U.S. Treasuries used in the fair value measurement of Level 3 corporate debt securities and asset backed securities in isolation would have resulted in a significantly lower (higher) fair value measurement.
Significant increases (decreases) in the annual default rate, loss severity, and constant prepayment rate used in the fair value measurement of Level 3 asset backed securities in isolation, generally, would have resulted in a significantly lower (higher) fair value measurement and significant increases (decreases) in loss severity in isolation would have resulted in a significantly lower (higher) fair value measurement.
Significant increases (decreases) in the surrender assumption used in the fair value measurement of the fixed deferred indexed annuity ceded embedded derivatives in isolation would have resulted in a significantly lower (higher) fair value measurement.
Significant increases (decreases) in nonperformance risk used in the fair value measurement of the IUL embedded derivatives in isolation would have resulted in a significantly lower (higher) fair value measurement.
Significant increases (decreases) in nonperformance risk and surrender assumption used in the fair value measurements of the fixed deferred indexed annuity embedded derivatives and structured variable annuity embedded derivatives in isolation would have resulted in a significantly lower (higher) liability value.
Determination of Fair Value
The Company uses valuation techniques consistent with the market and income approaches to measure the fair value of its assets and liabilities. The Company’s market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company’s income approach uses valuation techniques to convert future projected cash flows to a single discounted present value amount. When applying either approach, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs.
The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy.
Assets
Available-for-Sale Securities
When available, the fair value of securities is based on quoted prices in active markets. If quoted prices are not available, fair values are obtained from third-party pricing services, non-binding broker quotes, or other model-based valuation techniques.
Level 1 securities primarily include U.S. Treasuries.
Level 2 securities primarily include corporate bonds, residential mortgage backed securities, commercial mortgage backed securities, state and municipal obligations, asset backed securities and foreign government securities. The fair value of these Level 2 securities is based on a market approach with prices obtained from third-party pricing services. Observable inputs used to value these securities can include, but are not limited to, reported trades, benchmark yields, issuer spreads and non-binding broker quotes. The fair value of securities included in an observable transaction with a market participant are also considered Level 2 when the market is not active.
Level 3 securities primarily include certain corporate bonds, non-agency residential mortgage backed securities and asset backed securities with fair value typically based on a single non-binding broker quote. The underlying inputs used for some of the non-binding broker quotes are not readily available to the Company. The Company’s privately placed corporate bonds are typically based on a single non-binding broker quote. The fair value of affiliated asset backed securities is determined using a discounted cash flow model. Inputs used to determine the expected cash flows include assumptions about discount rates and default, prepayment and recovery rates of the underlying assets. Given the significance of the unobservable inputs to this fair value measurement, the fair value of the investment in the affiliated asset backed securities is classified as Level 3.
Management is responsible for the fair values recorded on the financial statements. Prices received from third-party pricing services are subjected to exception reporting that identifies investments with significant daily price movements as well as no movements. The Company reviews the exception reporting and resolves the exceptions through reaffirmation of the price or recording an appropriate fair value estimate. The Company also performs subsequent transaction testing. The Company performs annual due diligence of third-party pricing services. The Company’s due diligence procedures include assessing the vendor’s valuation qualifications, control environment, analysis of asset-class specific valuation methodologies, and understanding of sources of market observable assumptions
45


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
and unobservable assumptions, if any, employed in the valuation methodology. The Company also considers the results of its exception reporting controls and any resulting price challenges that arise.
Cash Equivalents
Cash equivalents include time deposits and other highly liquid investments with original or remaining maturities at the time of purchase of 90 days or less. Actively traded money market funds are measured at their NAV and classified as Level 1. U.S. Treasuries are also classified as Level 1. The Company’s remaining cash equivalents are classified as Level 2 and measured at amortized cost, which is a reasonable estimate of fair value because of the short time between the purchase of the instrument and its expected realization.
Receivables
The Company reinsured its fixed deferred indexed annuity products which have an indexed account that is accounted for as an embedded derivative. The Company uses discounted cash flow models to determine the fair value of these ceded embedded derivatives. The fair value of fixed deferred indexed annuity ceded embedded derivatives includes significant observable interest rates, volatilities and equity index levels and significant unobservable surrender rates. Given the significance of the unobservable surrender rates, these embedded derivatives are classified as Level 3.
Other Assets
Derivatives that are measured using quoted prices in active markets, such as derivatives that are exchange-traded, are classified as Level 1 measurements. The variation margin on futures contracts is also classified as Level 1. The fair value of derivatives that are traded in less active over-the-counter (“OTC”) markets is generally measured using pricing models with market observable inputs such as interest rates and equity index levels. These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options. The counterparties’ nonperformance risk associated with uncollateralized derivative assets was immaterial as of both September 30, 2024 and December 31, 2023. See Note 13 and Note 14 for further information on the credit risk of derivative instruments and related collateral.
Separate Account Assets
The fair value of assets held by separate accounts is determined by the NAV of the funds in which those separate accounts are invested. The NAV is used as a practical expedient for fair value and represents the exit price for the separate account. Separate account assets are excluded from classification in the fair value hierarchy.
Liabilities
Policyholder Account Balances, Future Policy Benefits and Claims
There is no active market for the transfer of the Company’s embedded derivatives attributable to the provisions of fixed deferred indexed annuity, structured variable annuity and IUL products.
The Company uses a discounted cash flow model to determine the fair value of the embedded derivatives associated with the provisions of its equity index annuity product. The projected cash flows generated by this model are based on significant observable inputs related to interest rates, volatilities and equity index levels and, therefore, are classified as Level 2.
The Company uses discounted cash flow models to determine the fair value of the embedded derivatives associated with the provisions of its fixed deferred indexed annuity, structured variable annuity and IUL products. The structured variable annuity product is a limited flexible purchase payment annuity that offers 45 different indexed account options providing equity market exposure and a fixed account. Each indexed account includes a protection option (a buffer or a floor). If the index has a negative return, contractholder losses will be reduced by a buffer or limited to a floor. The portion allocated to an indexed account is accounted for as an embedded derivative. The fair value of fixed deferred indexed annuity, structured variable annuity and IUL embedded derivatives includes significant observable interest rates, volatilities and equity index levels and significant unobservable surrender rates and the estimate of the Company’s nonperformance risk. Given the significance of the unobservable surrender rates and the nonperformance risk assumption, the fixed deferred indexed annuity, structured variable annuity and IUL embedded derivatives are classified as Level 3.
The embedded derivatives attributable to these provisions are recorded in Policyholder account balances, future policy benefits and claims.
Other Liabilities
Derivatives that are measured using quoted prices in active markets, such as derivatives that are exchange-traded, are classified as Level 1 measurements. The variation margin on futures contracts is also classified as Level 1. The fair value of derivatives that are traded in less active OTC markets is generally measured using pricing models with market observable inputs such as interest rates and equity index levels. These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options. The Company’s nonperformance risk associated with uncollateralized derivative liabilities was immaterial as of both
46


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
September 30, 2024 and December 31, 2023. See Note 13 and Note 14 for further information on the credit risk of derivative instruments and related collateral.
Fair Value on a Nonrecurring Basis
The Company assesses its investment in affordable housing partnerships for impairment. The investments that are determined to be impaired are written down to their fair value. The Company uses a discounted cash flow model to measure the fair value of these investments. Inputs to the discounted cash flow model are estimates of future net operating losses and tax credits available to the Company and discount rates based on market condition and the financial strength of the syndicator (general partner). The balance of affordable housing partnerships measured at fair value on a nonrecurring basis was $29 million and $41 million as of September 30, 2024 and December 31, 2023, respectively, and is classified as Level 3 in the fair value hierarchy.
Assets and Liabilities Not Reported at Fair Value
The following tables provide the carrying value and the estimated fair value of financial instruments that are not reported at fair value:
 
September 30, 2024
Carrying ValueFair Value
Level 1Level 2Level 3Total
(in millions)
Financial Assets
Mortgage loans, net$1,780 $ $ $1,709 $1,709 
Policy loans966  966  966 
Other investments66  45 20 65 
Receivables5,969   5,163 5,163 
Financial Liabilities
Policyholder account balances, future policy benefits and claims
$19,195 $ $ $16,758 $16,758 
Short-term borrowings201  201  201 
Long-term debt500  342  342 
Other liabilities5   4 4 
Separate account liabilities — investment contracts368  368  368 
 December 31, 2023
Carrying ValueFair Value
Level 1Level 2Level 3Total
(in millions)
Financial Assets
Mortgage loans, net$1,725 $ $ $1,599 $1,599 
Policy loans912  912  912 
Other investments76  54 22 76 
Receivables6,514   5,566 5,566 
Financial Liabilities
Policyholder account balances, future policy benefits and claims
$16,641 $ $ $14,243 $14,243 
Short-term borrowings201  201  201 
Long-term debt500  339  339 
Other liabilities5   5 5 
Separate account liabilities — investment contracts332  332  332 
Other investments include syndicated loans and the Company’s membership in the FHLB. Receivables include deposit receivables. See Note 6 for additional information on mortgage loans, policy loans, syndicated loans and deposit receivables.
Policyholder account balances, future policy benefits and claims include fixed annuities in deferral status, non-life contingent fixed annuities in payout status, indexed and structured variable annuity host contracts, and the fixed portion of a small number of variable annuity contracts classified as investment contracts. See Note 8 for additional information on these liabilities. Short-term borrowings include FHLB borrowings. Long-term debt includes the surplus note with Ameriprise Financial. See Note 11 for further information on short-term borrowings and long-term debt. Other liabilities include future funding commitments to affordable housing partnerships
47


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
and other real estate partnerships. Separate account liabilities are related to certain annuity products that are classified as investment contracts.
13. Offsetting Assets and Liabilities
Certain financial instruments and derivative instruments are eligible for offset in the Consolidated Balance Sheets. The Company’s derivative instruments are subject to master netting and collateral arrangements and qualify for offset. A master netting arrangement with a counterparty creates a right of offset for amounts due to and from that same counterparty that is enforceable in the event of a default or bankruptcy. The Company’s policy is to recognize amounts subject to master netting arrangements on a gross basis in the Consolidated Balance Sheets.
The following tables present the gross and net information about the Company’s assets subject to master netting arrangements:
 
September 30, 2024
Gross Amounts of Recognized AssetsGross Amounts Offset in the
Consolidated Balance Sheets
Amounts of Assets Presented in the Consolidated Balance SheetsGross Amounts Not Offset in the Consolidated Balance SheetsNet Amount
Financial Instruments (1)
Cash CollateralSecurities Collateral
(in millions)
Derivatives:       
OTC$8,314 $ $8,314 $(5,519)$(1,260)$(1,483)$52 
OTC cleared38  38 (38)   
Exchange-traded122  122 (26)  96 
Total$8,474 $ $8,474 $(5,583)$(1,260)$(1,483)$148 
December 31, 2023
Gross Amounts of Recognized AssetsGross Amounts Offset in the
Consolidated Balance Sheets
Amounts of Assets Presented in the Consolidated Balance SheetsGross Amounts Not Offset in the Consolidated Balance SheetsNet Amount
Financial Instruments (1)
Cash CollateralSecurities Collateral
(in millions)
Derivatives:       
OTC$5,170 $ $5,170 $(3,694)$(1,101)$(357)$18 
OTC cleared9  9 (9)   
Exchange-traded38  38 (18)  20 
Total $5,217 $ $5,217 $(3,721)$(1,101)$(357)$38 
(1) Represents the amount of assets that could be offset by liabilities with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.
The following tables present the gross and net information about the Company’s liabilities subject to master netting arrangements:
September 30, 2024
Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the
Consolidated Balance Sheets
Amounts of Liabilities Presented in the Consolidated Balance SheetsGross Amounts Not Offset in the Consolidated Balance SheetsNet Amount
Financial Instruments (1)
Cash CollateralSecurities Collateral
(in millions)
Derivatives:
OTC$5,640 $ $5,640 $(5,519)$ $(119)$2 
OTC cleared74  74 (38)  36 
Exchange-traded26  26 (26)   
Total $5,740 $ $5,740 $(5,583)$ $(119)$38 
48


Index
RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
December 31, 2023
Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the
Consolidated Balance Sheets
Amounts of Liabilities Presented in the Consolidated Balance SheetsGross Amounts Not Offset in the Consolidated Balance SheetsNet Amount
Financial Instruments (1)
Cash CollateralSecurities Collateral
(in millions)
Derivatives:
OTC$3,812 $ $3,812 $(3,694)$(34)$(78)$6 
OTC cleared35  35 (9)  26 
Exchange-traded18  18 (18)   
Total$3,865 $ $3,865 $(3,721)$(34)$(78)$32 
(1) Represents the amount of liabilities that could be offset by assets with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.
In the tables above, the amount of assets or liabilities presented are offset first by financial instruments that have the right of offset under master netting or similar arrangements, then any remaining amount is reduced by the amount of cash and securities collateral. The actual collateral may be greater than amounts presented in the tables.
When the fair value of collateral accepted by the Company is less than the amount due to the Company, there is a risk of loss if the counterparty fails to perform or provide additional collateral. To mitigate this risk, the Company monitors collateral values regularly and requires additional collateral when necessary. When the value of collateral pledged by the Company declines, it may be required to post additional collateral.
Freestanding derivative instruments are reflected in Other assets and Other liabilities. Cash collateral pledged by the Company is reflected in Other assets and cash collateral accepted by the Company is reflected in Other liabilities. See Note 14 for additional disclosures related to the Company’s derivative instruments and Note 4 for information related to derivatives held by consolidated investment entities.
14. Derivatives and Hedging Activities
Derivative instruments enable the Company to manage its exposure to various market risks. The value of such instruments is derived from an underlying variable or multiple variables, including equity and interest rate indices or prices. The Company primarily enters into derivative agreements for risk management purposes related to the Company’s products and operations.
Certain of the Company’s freestanding derivative instruments are subject to master netting arrangements. The Company’s policy on the recognition of derivatives on the Consolidated Balance Sheets is to not offset fair value amounts recognized for derivatives and collateral arrangements executed with the same counterparty under the same master netting arrangement. See Note 13 for additional information regarding the estimated fair value of the Company’s freestanding derivatives after considering the effect of master netting arrangements and collateral.
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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
Generally, the Company uses derivatives as economic hedges and accounting hedges. The following table presents the notional value and gross fair value of derivative instruments, including embedded derivatives:
September 30, 2024
December 31, 2023
NotionalGross Fair ValueNotionalGross Fair Value
Assets (1)
Liabilities (2)
Assets (1)
Liabilities (2)
(in millions)
Derivatives not designated as hedging instruments
Interest rate contracts
$40,168 $243 $257 $42,516 $185 $305 
Equity contracts
100,114 8,202 5,448 81,905 5,010 3,450 
Credit contracts
3,365  32 3,375 1 106 
Foreign exchange contracts
3,100 29 3 2,952 21 4 
Total non-designated hedges146,747 8,474 5,740 130,748 5,217 3,865 
Embedded derivatives
IUL
N/A— 943 N/A— 873 
Fixed deferred indexed annuities and deposit receivablesN/A55 54 N/A51 52 
Structured variable annuities (3)
N/A— 2,317 N/A— 1,011 
Total embedded derivatives
N/A55 3,314 N/A51 1,936 
Total derivatives
$146,747 $8,529 $9,054 $130,748 $5,268 $5,801 
N/A  Not applicable.
(1) The fair value of freestanding derivative assets is included in Other assets and the fair value of ceded embedded derivative assets related to deposit receivables is included in Receivables.
(2) The fair value of freestanding derivative liabilities is included in Other liabilities. The fair value of IUL, fixed deferred indexed annuity and structured variable annuity embedded derivatives is included in Policyholder account balances, future policy benefits and claims.
(3) The fair value of the structured variable annuity embedded derivatives as of September 30, 2024 included $2.3 billion of individual embedded derivatives in a liability position and nil of individual embedded derivatives in an asset position. The fair value of the structured variable annuity embedded derivatives as of December 31, 2023 included $1.0 billion of individual embedded derivatives in a liability position and $15 million of individual embedded derivatives in an asset position.
See Note 12 for additional information regarding the Company’s fair value measurement of derivative instruments.
As of September 30, 2024 and December 31, 2023, investment securities with a fair value of $1.8 billion and $1.5 billion, respectively, were pledged to meet contractual obligations under derivative contracts, of which $175 million and $145 million, respectively, may be sold, pledged or rehypothecated by the counterparty. As of September 30, 2024 and December 31, 2023, investment securities with a fair value of $1.8 billion and $376 million, respectively, were received as collateral to meet contractual obligations under derivative contracts, of which $1.5 billion and $314 million, respectively, may be sold, pledged or rehypothecated by the Company. As of both September 30, 2024 and December 31, 2023, the Company had sold, pledged or rehypothecated none of these securities. In addition, as of both September 30, 2024 and December 31, 2023, non-cash collateral accepted was held in separate custodial accounts and was not included in the Company’s Consolidated Balance Sheets.

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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following table presents a summary of the impact of derivatives not designated as hedging instruments, including embedded derivatives, on the Consolidated Statements of Income:
Benefits, Claims, Losses and Settlement ExpensesInterest Credited to Fixed AccountsChange in Fair Value of Market Risk Benefits
(in millions)
Three Months Ended September 30, 2024
Interest rate contracts
$1 $ $448 
Equity contracts
337 18 (307)
Credit contracts
  (112)
Foreign exchange contracts
  (57)
IUL embedded derivatives 4  
Fixed deferred indexed annuity and deposit receivables embedded derivatives 5  
Structured variable annuity embedded derivatives(487)  
Total gain (loss)$(149)$27 $(28)
Three Months Ended September 30, 2023
Interest rate contracts
$(7)$ $(1,073)
Equity contracts
(119)(19)245 
Credit contracts
  154 
Foreign exchange contracts
  51 
IUL embedded derivatives 28  
Structured variable annuity embedded derivatives246   
Total gain (loss)$120 $9 $(623)
Benefits, Claims, Losses and Settlement ExpensesInterest Credited to Fixed AccountsChange in Fair Value of Market Risk Benefits
(in millions)
Nine Months Ended September 30, 2024
Interest rate contracts
$(7)$ $(273)
Equity contracts
1,187 65 (1,035)
Credit contracts
  (13)
IUL embedded derivatives (53) 
Fixed deferred indexed annuity and deposit receivables embedded derivatives 15  
Structured variable annuity embedded derivatives(1,440)  
Total gain (loss)$(260)$27 $(1,321)
Nine Months Ended September 30, 2023
Interest rate contracts
$(15)$ $(1,307)
Equity contracts
391 35 (655)
Credit contracts
  187 
Foreign exchange contracts
  63 
IUL embedded derivatives (2) 
Fixed deferred indexed annuity and deposit receivables embedded derivatives (2) 
Structured variable annuity embedded derivatives(443)  
Total gain (loss)$(67)$31 $(1,712)
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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The Company holds derivative instruments that either do not qualify or are not designated for hedge accounting treatment. These derivative instruments are used as economic hedges of equity, interest rate, credit and foreign currency exchange rate risk related to various products and transactions of the Company.
The deferred premium associated with certain of the above options is paid or received semi-annually over the life of the contract or at maturity. The following is a summary of the payments the Company is scheduled to make and receive for these options as of September 30, 2024:
Premiums PayablePremiums Receivable
(in millions)
2024 (1)
$25 $ 
2025121 20 
2026247 88 
202720  
202831  
2029 - 2031
369  
Total$813 $108 
(1) 2024 amounts represent the amounts payable and receivable for the period from October 1, 2024 to December 31, 2024.
Actual timing and payment amounts may differ due to future settlements, modifications or exercises of the contracts prior to the full premium being paid or received.
Structured variable annuity and IUL products have returns tied to the performance of equity markets. As a result of fluctuations in equity markets, the obligation incurred by the Company related to structured variable annuity and IUL products will positively or negatively impact earnings over the life of these products. The equity components of structured variable annuity and IUL product obligations are considered embedded derivatives, which are bifurcated from their host contracts for valuation purposes and reported on the Consolidated Balance Sheets at fair value with changes in fair value reported in earnings. As a means of economically hedging its obligations under the provisions of these products, the Company enters into interest rate swaps, index options and futures contracts.
As discussed in Note 10, the Company issues variable annuity contracts that provide protection to contractholders from other-than-nominal capital market risk and expose the Company to other-than-nominal capital market risk. The Company economically hedges its obligations under these market risk benefits using options, swaptions, swaps and futures.
Credit Risk
Credit risk associated with the Company’s derivatives is the risk that a derivative counterparty will not perform in accordance with the terms of the applicable derivative contract. To mitigate such risk, the Company has established guidelines and oversight of credit risk through a comprehensive enterprise risk management program that includes members of senior management. Key components of this program are to require preapproval of counterparties and the use of master netting and collateral arrangements whenever practical. See Note 13 for additional information on the Company’s credit exposure related to derivative assets.
Certain of the Company’s derivative contracts contain provisions that adjust the level of collateral the Company is required to post based on the Company’s financial strength rating (or based on the debt rating of the Company’s parent, Ameriprise Financial). Additionally, certain of the Company’s derivative contracts contain provisions that allow the counterparty to terminate the contract if the Company does not maintain a specific financial strength rating or Ameriprise Financial’s debt does not maintain a specific credit rating (generally an investment grade rating). If these termination provisions were to be triggered, the Company’s counterparty could require immediate settlement of any net liability position. As of September 30, 2024 and December 31, 2023, the aggregate fair value of derivative contracts in a net liability position containing such credit contingent provisions was $121 million and $62 million, respectively. The aggregate fair value of assets posted as collateral for such instruments as of September 30, 2024 and December 31, 2023 was $119 million and $55 million, respectively. If the credit contingent provisions of derivative contracts in a net liability position as of September 30, 2024 and December 31, 2023 were triggered, the aggregate fair value of additional assets that would be required to be posted as collateral or needed to settle the instruments immediately would have been $2 million and $7 million, respectively.
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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
15. Shareholder’s Equity
The following table presents the amounts related to each component of other comprehensive income (loss) (“OCI”):
Three Months Ended September 30,
20242023
PretaxIncome Tax Benefit (Expense)Net of TaxPretaxIncome Tax Benefit (Expense)Net of Tax
(in millions)
Net unrealized gains (losses) on securities:
Net unrealized gains (losses) on securities arising during the period (1)
$827 $(178)$649 $(595)$127 $(468)
Reclassification of net (gains) losses on securities included in net income (2)
(2)1 (1)38 (8)30 
Impact of benefit reserves and reinsurance recoverables(18)4 (14)14 (3)11 
Net unrealized gains (losses) on securities807 (173)634 (543)116 (427)
Effect of changes in discount rate assumptions on certain long-duration contracts(188)41 (147)221 (47)174 
Effect of changes in instrument-specific credit risk on MRBs(63)14 (49)23 (5)18 
Total other comprehensive income (loss)$556 $(118)$438 $(299)$64 $(235)
Nine Months Ended September 30,
20242023
PretaxIncome Tax Benefit (Expense)Net of TaxPretaxIncome Tax Benefit (Expense)Net of Tax
(in millions)
Net unrealized gains (losses) on securities:
Net unrealized gains (losses) on securities arising during the period (1)
$444 $(95)$349 $(455)$102 $(353)
Reclassification of net (gains) losses on securities included in net income (2)
(3)1 (2)27 (6)21 
Impact of benefit reserves and reinsurance recoverables(4)1 (3)8 (2)6 
Net unrealized gains (losses) on securities437 (93)344 (420)94 (326)
Effect of changes in discount rate assumptions on certain long-duration contracts(21)5 (16)213 (45)168 
Effect of changes in instrument-specific credit risk on MRBs(98)21 (77)68 (15)53 
Total other comprehensive income (loss)$318 $(67)$251 $(139)$34 $(105)
(1) Includes impairments on Available-for-Sale securities related to factors other than credit that were recognized in OCI during the period.
(2) Reclassification amounts are recorded in Net realized investment gains (losses).
Other comprehensive income (loss) related to net unrealized gains (losses) on securities includes three components: (i) unrealized gains (losses) that arose from changes in the fair value of securities that were held during the period; (ii) (gains) losses that were previously unrealized, but have been recognized in current period net income due to sales of Available-for-Sale securities and due to the reclassification of noncredit losses to credit losses; and (iii) other adjustments primarily consisting of changes in insurance and annuity asset and liability balances, such as benefit reserves and reinsurance recoverables, to reflect the expected impact on their carrying values had the unrealized gains (losses) been realized as of the respective balance sheet dates.
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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
The following table presents the changes in the balances of each component of AOCI, net of tax:
Net Unrealized Gains (Losses) on SecuritiesEffect of Changes in Discount Rate Assumptions on Certain Long-Duration ContractsEffect of Changes in Instrument-Specific Credit Risk on MRBsOtherTotal
(in millions)
Balance at July 1, 2024
$(772)$5 $(113)$(1)$(881)
OCI before reclassifications635 (147)(49) 439 
Amounts reclassified from AOCI(1)   (1)
Total OCI634 (147)(49) 438 
Balance at September 30, 2024
$(138)$(142)$(162)$(1)$(443)
Balance at July 1, 2023
$(890)$(78)$15 $(1)$(954)
OCI before reclassifications(457)174 18  (265)
Amounts reclassified from AOCI30    30 
Total OCI(427)174 18  (235)
Balance at September 30, 2023
$(1,317)$96 $33 $(1)$(1,189)
Balance at January 1, 2024
$(482)$(126)$(85)$(1)$(694)
OCI before reclassifications346 (16)(77) 253 
Amounts reclassified from AOCI(2)   (2)
Total OCI344 (16)(77) 251 
Balance at September 30, 2024
$(138)$(142)$(162)$(1)$(443)
Balance at January 1, 2023
$(991)$(72)$(20)$(1)$(1,084)
OCI before reclassifications(347)168 53  (126)
Amounts reclassified from AOCI21    21 
Total OCI(326)168 53  (105)
Balance at September 30, 2023
$(1,317)$96 $33 $(1)$(1,189)
16. Income Taxes
The Company’s effective tax rate was 21.9% and 9.4% for the three months ended September 30, 2024 and 2023, respectively. The Company’s effective tax rate was 10.8% and 7.9% for the nine months ended September 30, 2024 and 2023, respectively.
The Company recorded a pretax loss for the three months ended September 30, 2024. Tax benefits applied to a pretax loss raise the effective tax rate. The effective tax rate for the three months ended September 30, 2024 was higher than the statutory rate as a result of tax preferred items including the dividends received deduction and low income housing tax credits, partially offset by an increase in state income taxes, net of federal benefit. The effective tax rate for the nine months ended September 30, 2024 was lower than the statutory rate as a result of tax preferred items including the dividends received deduction, foreign tax credits, net of addback, and low income housing tax credits, partially offset by the impact of projected pretax income for the full year ending December 31, 2024 relative to actual year-to-date pretax income and state income taxes, net of federal benefit.
The effective tax rate for the three months ended September 30, 2023 was lower than the statutory rate primarily due to tax preferred items including low income housing tax credits and the dividends received deduction. The effective tax rate for the nine months ended September 30, 2023 was lower than the statutory rate as a result of tax preferred items including foreign tax credits, net of addback, the dividends received deduction, and low income housing tax credits, as well as the benefit of an audit closure partially offset by an increase in unrecognized tax benefits.
The increase in the effective tax rate for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 was primarily due to a pretax loss in the current period and the related impact on tax preferred items.
The increase in the effective tax rate for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily due to the impact of an increase in projected pretax income for the full year ending December 31, 2024 compared to the prior year, a decrease in foreign tax credits, net of addback, the benefit of an audit closure in the prior period, an increase in state
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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
income taxes, net of federal benefit, and a decrease in low income housing tax credits, partially offset by a decrease in unrecognized tax benefits.
Included in the Company’s deferred income tax assets are tax benefits related to state net operating losses of $30 million, net of federal benefit, which will expire beginning December 31, 2024.
The Company is required to establish a valuation allowance for any portion of its deferred tax assets that management believes will not be realized. Significant judgment is required in determining if a valuation allowance should be established and the amount of such allowance if required. Factors used in making this determination include estimates relating to the performance of the business. Consideration is given to, among other things in making this determination: (i) future taxable income exclusive of reversing temporary differences and carryforward; (ii) future reversals of existing taxable temporary differences; (iii) taxable income in prior carryback years; and (iv) tax planning strategies. Based on analysis of the Company’s tax position as of September 30, 2024, management believes it is more likely than not that the Company will not realize certain state net operating losses of $30 million and state deferred tax assets of $2 million, both net of federal benefit; therefore, a valuation allowance has been established. The valuation allowance was $32 million and $30 million, net of federal benefit, as of September 30, 2024 and December 31, 2023, respectively.
As of September 30, 2024 and December 31, 2023, the Company had $23 million and $27 million, respectively, of gross unrecognized tax benefits. If recognized, approximately $17 million and $19 million, net of federal tax benefits, of unrecognized tax benefits as of September 30, 2024 and December 31, 2023, respectively, would affect the effective tax rate. During the second quarter of 2023, the Company had additions to its gross unrecognized tax benefits for tax positions of prior years of $64 million and reductions to its gross unrecognized tax benefits of prior years of $71 million.
It is reasonably possible that the total amount of unrecognized tax benefits will change in the next 12 months. The Company estimates that the total amount of gross unrecognized tax benefits will not decrease in the next 12 months.
The Company recognizes interest and penalties related to unrecognized tax benefits as a component of the income tax provision. The Company recognized nil and a net increase of $1 million in interest and penalties for the three and nine months ended September 30, 2024, respectively. The Company recognized nil and a net increase of $7 million in interest and penalties for the three and nine months ended September 30, 2023, respectively. As of September 30, 2024 and December 31, 2023, the Company had a payable of $12 million and $11 million, respectively, related to accrued interest and penalties.
The Company files income tax returns as part of its inclusion in the consolidated federal income tax return of Ameriprise Financial in the U.S. federal jurisdiction and various state jurisdictions. The Internal Revenue Service (“IRS”) is currently auditing Ameriprise Financial’s U.S. income tax returns for 2019 and 2020. The state income tax returns of Ameriprise Financial or its subsidiaries, including the Company, are currently under examination by various jurisdictions for years ranging from 2017 through 2021.    
17. Contingencies
Contingencies
The Company and its affiliates are involved in the normal course of business in legal proceedings which include regulatory inquiries, arbitration and litigation, including class actions, concerning matters arising in connection with the conduct of its activities. These include proceedings specific to the Company as well as proceedings generally applicable to business practices in the industries in which it operates. The Company can also be subject to legal proceedings arising out of its general business activities, such as its investments, contracts and employment relationships. Uncertain economic conditions, heightened and sustained volatility in the financial markets and significant financial reform legislation may increase the likelihood that clients and other persons or regulators may present or threaten legal claims or that regulators increase the scope or frequency of examinations of the Company or the insurance industry generally.
As with other insurance companies, the level of regulatory activity and inquiry concerning the Company’s businesses remains elevated. From time to time, the Company and its affiliates, including AFS and RiverSource Distributors, Inc. receive requests for information from, and/or are subject to examination or claims by various state, federal and other domestic authorities. The Company and its affiliates typically have numerous pending matters, which include information requests, exams or inquiries regarding their business activities and practices and other subjects, including from time to time: sales and distribution of, and disclosure practices related to, various products, including the Company’s insurance and annuity products; supervision of associated persons, including AFS financial advisors and RiverSource Distributors, Inc.’s wholesalers; administration of insurance and annuity claims; security of client information; and transaction monitoring systems and controls. The Company and its affiliates are cooperating with the applicable regulators.
These pending matters are subject to uncertainties and, as such, it is inherently difficult to determine whether any loss is probable or even reasonably possible, or to reasonably estimate the amount of any loss that may result from such matters. The Company cannot predict with certainty if, how, or when any such proceedings will be initiated or resolved. Matters frequently need to be more developed before a potential loss or range of loss can be reasonably estimated for any matter. An adverse outcome in any matter could
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RIVERSOURCE LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)
result in an adverse judgment, a settlement, fine, penalty, or other sanction, and may lead to further claims, examinations, or adverse publicity each of which could have a material adverse effect on the Company’s consolidated financial condition, results of operations, or liquidity.
In accordance with applicable accounting standards, the Company establishes an accrued liability for contingent litigation and regulatory matters when those matters present loss contingencies that are both probable and can be reasonably estimated. The Company discloses the nature of the contingency when management believes there is at least a reasonable possibility that the outcome may be material to the Company’s consolidated financial statements and, where feasible, an estimate of the possible loss. In such cases, there still may be an exposure to loss in excess of any amounts reasonably estimated and accrued. When a loss contingency is not both probable and reasonably estimable, the Company does not establish an accrued liability, but continues to monitor, in conjunction with any outside counsel handling a matter, further developments that would make such loss contingency both probable and reasonably estimable. Once the Company establishes an accrued liability with respect to a loss contingency, the Company continues to monitor the matter for further developments that could affect the amount of the accrued liability that has been previously established, and any appropriate adjustments are made each quarter.
Guaranty Fund Assessments
RiverSource Life Insurance Company and RiverSource Life of NY are required by law to be a member of the guaranty fund association in every state where they are licensed to do business. In the event of insolvency of one or more unaffiliated insurance companies, the Company could be adversely affected by the requirement to pay assessments to the guaranty fund associations. The Company projects its cost of future guaranty fund assessments based on estimates of insurance company insolvencies provided by the National Organization of Life and Health Insurance Guaranty Associations and the amount of its premiums written relative to the industry-wide premium in each state. The Company accrues the estimated cost of future guaranty fund assessments when it is considered probable that an assessment will be imposed, the event obligating the Company to pay the assessment has occurred and the amount of the assessment can be reasonably estimated.
The Company has a liability for estimated guaranty fund assessments and a related premium tax asset. As of both September 30, 2024 and December 31, 2023, the estimated liability was $34 million. As of both September 30, 2024 and December 31, 2023, the related premium tax asset was $29 million. The expected period over which guaranty fund assessments will be made and the related tax credits recovered is not known.
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RIVERSOURCE LIFE INSURANCE COMPANY
ITEM 2. MANAGEMENT’S NARRATIVE ANALYSIS
Overview
RiverSource Life Insurance Company (“RiverSource Life”) and its subsidiaries are referred to collectively in this Form 10-Q as the “Company”. The following discussion and management’s narrative analysis of the financial condition and results of operations should be read in conjunction with the “Forward-Looking Statements” that follow, the Consolidated Financial Statements and Notes presented in Item 1 and its Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (“SEC”) on February 22, 2024 (“2023 10-K”), as well as its quarterly reports on Form 10-Q and any current reports on Form 8-K.
The Consolidated Financial Statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Management’s narrative analysis is presented pursuant to General Instructions H(2)(a) of Form 10-Q in lieu of Management’s Discussion and Analysis of Financial Condition and Results of Operations.
See Note 1 to the Consolidated Financial Statements for additional information.
The Company operates its business in the broader context of the macroeconomic forces around it, including the global and U.S. economies, changes in interest and inflation rates, financial market volatility, fluctuations in foreign exchange rates, geopolitical strain, pandemics, the competitive environment, client and customer activities and preferences, and the various regulatory and legislative developments. Financial markets and macroeconomic conditions have had and will continue to have a significant impact on the Company’s operating and performance results. The Company’s success may be affected by the factors discussed in Item 1A, “Risk Factors” in the Company’s 2023 10-K and other factors as discussed herein.
The Company consolidates certain variable interest entities for which it provides investment management services. These entities are defined as consolidated investment entities (“CIEs”). While the consolidation of the CIEs impacts the Company’s balance sheet and income statement, the exposure to these entities is unchanged and there is no impact to the underlying business results. For further information on CIEs, see Note 4 to the Consolidated Financial Statements. Changes in the fair value of assets and liabilities related to the CIEs, primarily syndicated loans and debt, are reflected in Net investment income.
Critical Accounting Estimates
The accounting and reporting policies that the Company uses affect its Consolidated Financial Statements. Certain of the Company’s accounting and reporting policies are critical to an understanding of the Company’s financial condition and results of operations. In some cases, the application of these policies can be significantly affected by the estimates, judgments and assumptions made by management during the preparation of the Consolidated Financial Statements. These accounting policies are discussed in detail in “Management’s Narrative Analysis — Critical Accounting Estimates” in the Company’s 2023 10-K.
Recent Accounting Pronouncements
For information regarding recent accounting pronouncements and their expected impact on the Company’s future consolidated financial condition or results of operations, see Note 2 to the Consolidated Financial Statements.
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RIVERSOURCE LIFE INSURANCE COMPANY
Consolidated Results of Operations for the Nine Months Ended September 30, 2024 and 2023
The following table presents the Company’s consolidated results of operations:
 
Nine Months Ended September 30,
Change
2024
2023
(in millions)
Revenues
Premiums$369 $323 $46 14 %
Net investment income1,133 950 183 19 
Policy and contract charges1,538 1,510 28 
Other revenues434 447 (13)(3)
Net realized investment gains (losses)(43)(58)15 26 
Total revenues3,431 3,172 259 
Benefits and expenses    
Benefits, claims, losses and settlement expenses1,055 746 309 41 
Interest credited to fixed accounts435 464 (29)(6)
Remeasurement (gains) losses of future policy benefit reserves(34)(17)(17)NM
Change in fair value of market risk benefits658 558 100 18 
Amortization of deferred acquisition costs175 180 (5)(3)
Interest and debt expense145 143 
Other insurance and operating expenses541 525 16 
Total benefits and expenses2,975 2,599 376 14 
Pretax income (loss)456 573 (117)(20)
Income tax provision (benefit)49 46 
Net income (loss)$407 $527 $(120)(23)%
NM  Not Meaningful.
Overall
Net income decreased $120 million for the nine months ended September 30, 2024 compared to the prior year period. Pretax income decreased $117 million for the nine months ended September 30, 2024 compared to the prior year period.
The following impacts were significant drivers of the period-over-period change in pretax income:
The market impact on non-traditional long-duration products (including variable and fixed deferred annuity contracts and universal life (“UL”) insurance contracts), net of hedges and the reinsurance accrual was an expense of $322 million for the nine months ended September 30, 2024 compared to an expense of $137 million for the prior year period.
The favorable impact of the trend in rising investment portfolio yields, along with higher average balances due to the growth in structured variable annuities (“SVA”).
Variable annuity account balances increased 17% to $87.7 billion as of September 30, 2024 compared to the prior year period due to market appreciation, partially offset by net outflows of $3.5 billion. Variable annuity sales increased 29% for the nine months ended September 30, 2024 compared to the prior year period primarily reflecting an increase in sales of SVAs. Account values with living benefit riders declined to 51% as of September 30, 2024 compared to 55% a year ago reflecting management’s actions to optimize the Company’s business mix. This trend is expected to continue and meaningfully shift the mix of business away from products with living benefit guarantees over time.
Fixed deferred annuity account balances declined 11% to $5.8 billion as of September 30, 2024 compared to the prior year period as policies continue to lapse and the Company previously discontinued new sales of fixed deferred annuities and fixed index annuities.
In the third quarter of the year, management conducted its annual review of life insurance, annuity and LTC valuation assumptions relative to current experience and management expectations including modeling changes. These annual assumption updates are collectively referred to as unlocking throughout this document.
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RIVERSOURCE LIFE INSURANCE COMPANY
The following table presents the total pretax impacts on the Company’s revenues and expenses attributable to the annual assumption updates, referred to as unlocking, for the nine months ended September 30:
Pretax Increase (Decrease)
2024
2023
(in millions)
Policy and contract charges$(4)$
Total revenues(4)
Interest credited to fixed accounts
(10)— 
Benefits, claims, losses and settlement expenses(4)(17)
Remeasurement (gains) losses of future policy benefit reserves:
LTC unlocking
(5)
Unlocking impact, excluding LTC(24)(6)
Total remeasurement (gains) losses of future policy benefit reserves(20)(11)
Change in fair value of market risk benefits107 128 
Amortization of DAC— — 
Total benefits and expenses
73 100 
Pretax income (loss)
$(77)$(99)
The primary driver of the unlocking impact was lowered surrender assumptions on variable annuities with living benefits resulting in an expense for the nine months ended September 30, 2024, partially offset by the updated claims incident rates on disability insurance. The primary driver of the unlocking impact was lowered surrender assumptions on variable annuities with living benefits resulting in an expense for the nine months ended September 30, 2023.
Revenues
Premiums increased $46 million, or 14%, for the nine months ended September 30, 2024 compared to the prior year period primarily due to higher sales of life contingent payout annuities.
Net investment income increased $183 million, or 19%, for the nine months ended September 30, 2024 compared to the prior year period reflecting the favorable impact of the trend in rising investment portfolio yields, along with higher average balances due to the growth in SVAs.
Net realized investment losses were $43 million for the nine months ended September 30, 2024 compared to net realized investment losses of $58 million for the prior year period. The nine months ended September 30, 2024 included net realized losses of $46 million on investments held by CIEs. The net realized investment losses for the nine months ended September 30, 2023 included net realized losses of $27 million on Available-for-Sale securities, driven by the fixed maturity investment portfolio repositioning and net realized losses of $32 million on investments held by CIEs.
Benefits and Expenses
Benefits, claims, losses and settlement expenses increased $309 million, for the nine months ended September 30, 2024 compared to the prior year period primarily reflecting a $130 million increase in expense from market impacts on SVA embedded derivative, net of hedges in place to offset those risks. This increase was primarily the result of a favorable $804 million change in the market impact on derivatives hedging the SVA embedded derivative and an unfavorable $916 million change in the market impact on SVA embedded derivative. The main market driver contributing to these changes was the equity market impact on the SVA embedded derivative net of the impact on the corresponding hedge assets resulted in a higher expense for the nine months ended September 30, 2024 compared to the prior year period. This increase also reflects the impact of higher sales of life contingent payout annuities and increased volume in SVAs.
Interest credited to fixed accounts decreased $29 million, or 6%, for the nine months ended September 30, 2024 compared to the prior year period primarily reflecting the following items:
A $39 million decrease in expense from other market impacts on indexed universal life (“IUL”) benefits, net of hedges, which was a benefit of $23 million for the nine months ended September 30, 2024 compared to an expense of $16 million for the prior year period. The decrease in expense was primarily due to a decrease in the IUL embedded derivative in the prior period, which reflected model changes and more discounting due to higher Treasury rates, partially offset by higher option costs due to a higher option budget.
A $23 million increase in expense from the unhedged nonperformance credit spread risk adjustment on IUL benefits. The unfavorable impact of the nonperformance credit spread was $17 million for the nine months ended September 30, 2024 compared to a favorable impact of $6 million for the prior year period.
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Change in fair value of market risk benefits increased $100 million, or 18%, for the nine months ended September 30, 2024 compared to the prior year period primarily reflecting the following items:
A $69 million increase in expense from market impacts on variable annuity guaranteed benefits, net of hedges in place to offset those risks. This increase was the result of an unfavorable $437 million change in the market impact on variable annuity guaranteed benefits reserves and a favorable $392 million change in the market impact on derivatives hedging the variable annuity guaranteed benefits. The main market drivers contributing to these changes are summarized below:
Equity market impact on the variable annuity guaranteed benefits liability net of the impact on the corresponding hedge assets resulted in a higher benefit for the nine months ended September 30, 2024 compared to the prior year period.
Interest rate and bond impact on the variable annuity guaranteed benefits liability net of the impact on the corresponding hedge assets resulted in an expense for the nine months ended September 30, 2024 compared to a benefit for the prior year period.
Volatility impact on the variable annuity guaranteed benefits liability net of the impact on the corresponding hedge assets resulted in a higher expense for the nine months ended September 30, 2024 compared to the prior year period.
Other unhedged items, including the difference between the assumed and actual underlying separate account investment performance, transaction costs and various behavioral items, were a lower net expense for the nine months ended September 30, 2024 compared to the prior year period.
Income Taxes
The Company’s effective tax rate was 10.8% for the nine months ended September 30, 2024 compared to 7.9% for the prior year period. The increase in the effective tax rate for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily due to the impact of an increase in projected pretax income for the full year ending December 31, 2024 compared to the prior year, a decrease in foreign tax credits, net of addback, the benefit of an audit closure in the prior period, an increase in state income taxes, net of federal benefit, and a decrease in low income housing tax credits, partially offset by a decrease in unrecognized tax benefits. See Note 16 to the Consolidated Financial Statements for additional discussion on income taxes.
Market Risk
The Company’s primary market risk exposures are interest rate, equity price and credit risk. Equity price and interest rate fluctuations can have a significant impact on the Company’s results of operations, primarily due to the effects they have on asset-based fees and expenses, the spread income generated on the fixed portion of its variable annuities and variable insurance contracts, fixed annuity and insurance contracts, the value of market risk benefits and other liabilities associated with its variable annuities and the value of derivatives held to hedge related benefits.
Market risk benefits continue to be managed by utilizing a hedging program which attempts to match the sensitivity of the assets with the sensitivity of the benefits. This approach works with the premise that matched sensitivities will produce a highly effective hedging result. The Company’s comprehensive hedging program focuses mainly on first order sensitivities of assets and liabilities: Equity Market Level (Delta), Interest Rate Level (Rho) and Volatility (Vega). Additionally, various second order sensitivities are managed. The Company uses various options, swaptions, swaps and futures to manage risk exposures. The exposures are measured and monitored daily, and adjustments to the hedge portfolio are made as necessary.
To evaluate interest rate and equity price risk, the Company performs sensitivity testing which measures the impact on pretax income from the sources listed below for a 12-month period following a hypothetical 100 basis point increase in interest rates or a hypothetical 10% decline in equity prices. The interest rate risk test assumes a sudden 100 basis point parallel shift in the yield curve, with rates then staying at those levels for the next 12 months. The equity price risk test assumes a sudden 10% drop in equity prices, with equity prices then staying at those levels for the next 12 months. In estimating the values of variable annuities, indexed annuities, IUL insurance and the associated hedging instruments, the Company assumed no change in implied market volatility despite the 10% drop in equity prices.
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The following tables present the Company’s estimate of the impact on pretax income from the above defined hypothetical market movements as of September 30, 2024:

Equity Price Decline 10%Equity Price Exposure to Pretax Income
Before Hedge ImpactHedge ImpactNet Impact
 (in millions)
Asset-based fees and expenses (1)
$(60)$— $(60)
Variable annuity and structured variable annuity benefits:
Market risk benefits(943)749 (194)
Indexing feature for structured variable annuities920 (917)
Total variable annuity and structured variable annuity benefits(23)(168)(191)
IUL insurance40 (45)(5)
Total$(43)$(213)$(256)

Interest Rate Increase 100 Basis PointsInterest Rate Exposure to Pretax Income
Before Hedge ImpactHedge ImpactNet Impact
(in millions)
Asset-based fees and expenses (1)
$(12)$— $(12)
Variable annuity and structured variable annuity benefits:   
Market risk benefits1,294 (941)353 
Indexing feature for structured variable annuities(12)171 159 
Total variable annuity and structured variable annuity benefits1,282 (770)512 
Fixed annuities, fixed insurance and fixed portion of variable annuities and variable insurance products
44 — 44 
IUL insurance14 15 
Total$1,328 $(769)$559 
(1) Excludes incentive income which is impacted by market and fund performance during the period and cannot be readily estimated.
The above results compare to an estimated negative net impact to pretax income of $69 million related to a 10% equity price decline and an estimated positive net impact to pretax income of $527 million related to a 100 basis point increase in interest rates as of December 31, 2023.
Net impacts shown in the above tables from market risk benefits result largely from differences between the liability valuation basis and the hedging basis. Liabilities are valued using fair value accounting principles, with risk margins incorporated in contractholder behavior assumptions. The Company’s hedging is based on its determination of economic risk, which excludes certain items in the liability valuation.
Actual results could and likely will differ materially from those illustrated above as fair values have a number of estimates and assumptions. For example, the illustration above includes assuming that implied market volatility does not change when equity prices fall by 10% and that the 100 basis point increase in interest rates is a parallel shift of the yield curve. Furthermore, the Company has not tried to anticipate changes in client preferences for different types of assets or other changes in client behavior, nor has the Company tried to anticipate all strategic actions management might take to increase revenues or reduce expenses in these scenarios.
The selection of a 100 basis point interest rate increase as well as a 10% equity price decline should not be construed as a prediction of future market events. Impacts of larger or smaller changes in interest rates or equity prices will not be proportional to those shown for a 100 basis point increase in interest rates or a 10% decline in equity prices.
Fixed Annuities, Fixed Insurance and Fixed Portion of Variable Annuities and Variable Insurance Contracts
The Company’s earnings from fixed deferred annuities, fixed insurance, and the fixed portion of variable annuities and variable insurance contracts are based upon the spread between rates earned on assets held and the rates at which interest is credited to accounts. The Company primarily invests in fixed rate securities to fund the rate credited to clients. The Company guarantees an interest rate to the holders of these products. Investment assets and client liabilities generally differ as it relates to basis, repricing or maturity characteristics. Rates credited to clients’ accounts generally reset at shorter intervals than the yield on the underlying investments. Therefore, in an increasing interest rate environment, higher interest rates may be reflected in crediting rates to clients sooner than in rates earned on invested assets, which could result in a reduced spread between the two rates, reduced earned income and a negative impact on pretax income. While interest rates under the current environment have relieved some pressure from the liability guaranteed minimum interest rates (“GMIRs”), there are still some GMIRs above current levels. Hence, liability credited rates
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will move more slowly under a modest rise in interest rates while projected asset purchases would capture the full increase in interest rates. This dynamic would result in widening spreads under a modestly rising rate scenario given the current relationship between the current level of interest rates and the underlying GMIRs on the business. Of the $41.3 billion in Policyholder account balances, future policy benefits and claims as of September 30, 2024, $16.2 billion is related to liabilities created by these products. The Company does not hedge this exposure.
As a result of the current market environment, reinvestment yields are becoming more aligned with the current portfolio yield. The Company would expect the recent decline in its portfolio income yields to slow and begin to stabilize in future periods under the current environment. The carrying value and weighted average yield of non-structured fixed maturity securities and commercial mortgage loans that may generate proceeds to reinvest through September 30, 2026 due to prepayment, maturity or call activity at the option of the issuer, excluding securities with a make-whole provision, were $863 million and 4.5%, respectively, as of September 30, 2024. In addition, residential mortgage backed securities, which can be subject to prepayment risk under a low interest rate environment, totaled $4.0 billion and had a weighted average yield of 4.3% as of September 30, 2024. While these amounts represent investments that could be subject to reinvestment risk, it is also possible that these investments will be used to fund liabilities or may not be prepaid and will remain invested at their current yields. In addition to the interest rate environment, the mix of benefit payments versus product sales as well as the timing and volumes associated with such mix may impact the Company’s investment yield. Furthermore, reinvestment activities and the associated investment yield may also be impacted by corporate strategies implemented at management’s discretion. The average yield for investment purchases during the nine months ended September 30, 2024 was approximately 5.5%.
The reinvestment of proceeds from maturities, calls and prepayments at rates near the current portfolio yield will have a limited impact to future operating results. In this volatile rate environment, the Company assesses reinvestment risk in its investment portfolio and monitors this risk in accordance with its asset/liability management framework. In addition, the Company may update the crediting rates on its fixed products when warranted, subject to guaranteed minimums.
See Note 8 for more information on the account values of fixed deferred annuities, fixed insurance, and the fixed portion of variable annuities and variable insurance contracts by range of GMIRs and the range of the difference between rates credited to policyholders and contractholders as of September 30, 2024 and December 31, 2023 and the respective guaranteed minimums, as well as the percentage of account values subject to rate reset in the time period indicated.
Fair Value Measurements
The Company reports certain assets and liabilities at fair value; specifically, separate account assets, derivatives, market risk benefits, embedded derivatives, and most investments and cash equivalents. Fair value assumes the exchange of assets or liabilities occurs in orderly transactions and is not the result of a forced liquidation or distressed sale. The Company includes actual market prices, or observable inputs, in its fair value measurements to the extent available. Broker quotes are obtained when quotes from pricing services are not available. The Company validates prices obtained from third parties through a variety of means such as: price variance analysis, subsequent sales testing, stale price review, price comparison across pricing vendors and due diligence reviews of vendors. See Note 12 to the Consolidated Financial Statements for additional information on the Company’s fair value measurements.
Fair Value of Liabilities and Nonperformance Risk
Companies are required to measure the fair value of liabilities at the price that would be received to transfer the liability to a market participant (an exit price). Since there is not a market for the Company’s obligations of its market risk benefits, fixed deferred indexed annuities, structured variable annuities, and IUL insurance, the Company considers the assumptions participants in a hypothetical market would make to reflect an exit price. As a result, the Company adjusts the valuation of market risk benefits, fixed deferred indexed annuities, structured variable annuities, and IUL insurance by updating certain contractholder assumptions, adding explicit margins to provide for risk, and adjusting the rates used to discount expected cash flows to reflect a current market estimate of the Company’s nonperformance risk. The nonperformance risk adjustment is based on observable market data adjusted to estimate the risk of the Company not fulfilling these liabilities. Consistent with general market conditions, this estimate resulted in a spread over the U.S. Treasury curve as of September 30, 2024. As the Company’s estimate of this spread widens or tightens, the liability will decrease or increase, respectively. If this nonperformance credit spread moves to a zero spread over the U.S. Treasury curve, the reduction to future total equity would be approximately $639 million, net of the reinsurance accrual and income taxes (calculated at the statutory tax rate of 21%), based on September 30, 2024 credit spreads.
Liquidity and Capital Resources
Liquidity Strategy
The liquidity requirements of the Company are generally met by funds provided by investment income, maturities and periodic repayments of investments, premiums and proceeds from sales of investments, fixed annuity and fixed insurance deposits as well as capital contributions from its parent, Ameriprise Financial Inc. (“Ameriprise Financial”). Other liquidity sources the Company has established are short-term borrowings and available lines of credit with Ameriprise Financial aggregating $839 million.
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The Company enters into short-term borrowings, which may include repurchase agreements and Federal Home Loan Bank (“FHLB”) advances to reduce reinvestment risk. Short-term borrowings allow the Company to receive cash to reinvest in longer-duration assets, while maintaining the flexibility to pay back the short-term debt with cash flows generated by the fixed income portfolio. RiverSource Life Insurance Company is a member of the FHLB of Des Moines, which provides RiverSource Life Insurance Company access to collateralized borrowings. As of September 30, 2024 and December 31, 2023, the Company had estimated maximum borrowing capacity of $3.9 billion and $4.0 billion, respectively, under the FHLB facility, of which $201 million was outstanding as of both September 30, 2024 and December 31, 2023 and is collateralized with commercial mortgage backed securities and residential mortgage backed securities.
There have been no material changes to the Company’s contractual obligations disclosed in the Company’s 2023 10-K.
See Note 11 to the Consolidated Financial Statements for further information about the Company’s long-term debt.
The primary uses of funds are policy benefits, commissions, other product-related acquisition and sales inducement costs, operating expenses, policy loans, dividends to Ameriprise Financial and investment purchases. The Company routinely reviews its sources and uses of funds in order to meet its ongoing obligations, including reinsurance arrangements. The Company believes these cash flows will be sufficient to fund its short-term and long-term operating liquidity needs and dividends to Ameriprise Financial. Specific to reinsurance counterparties, in 2009, the Company established an agreement to protect its exposure to Genworth Life Insurance Company (“GLIC”) for its reinsured LTC. In 2016, substantial enhancements to this reinsurance protection agreement were finalized. The terms of these confidential provisions within the agreement have been shared, in the normal course of regular reviews, with the Company’s domiciliary regulator and rating agencies. GLIC is domiciled in Delaware, so in the event GLIC were subjected to rehabilitation or insolvency proceedings, such proceedings would be located in (and governed by) Delaware laws. Delaware courts have a long tradition of respecting commercial and reinsurance affairs as well as contracts among sophisticated parties. Similar credit protections to what the Company has with GLIC have been tested and respected in Delaware and elsewhere in the United States, and as a result the Company believes its credit protections would be respected even in the unlikely event that GLIC becomes subject to rehabilitation or insolvency proceedings in Delaware. Accordingly, while no credit protections are perfect, the Company believes the correct way to think about the risks represented by its counterparty credit exposure to GLIC is not the full amount of the gross liability that GLIC reinsures, but a much smaller net exposure to GLIC (if any that might exist after taking into account the Company’s credit protections). Thus, management believes that this agreement and offsetting non-LTC legacy arrangements with Genworth Financial, Inc. will enable the Company to recover on all net exposure in all material respects in the event of a rehabilitation or insolvency of GLIC.
Capital Activity
Cash dividends or distributions paid and received by RiverSource Life Insurance Company were as follows:
 
Nine Months Ended September 30,
20242023
(in millions)
Dividends paid to Ameriprise Financial
$600 $500 
Dividend received from RiverSource Life Insurance Co. of New York (“RiverSource Life of NY”)
— 50 
For dividends or distributions from the life insurance companies, notifications to state insurance regulators were made in advance of payments in excess of statutorily defined thresholds.
Regulatory Capital
RiverSource Life Insurance Company and RiverSource Life of NY are subject to regulatory capital requirements. Actual capital, determined on a statutory basis, and regulatory capital requirements for each of the life insurance entities were as follows:
 
Actual Capital (1)
Regulatory Capital Requirements (2)
September 30, 2024December 31,
2023
December 31,
2023
(in millions)
RiverSource Life Insurance Company$2,721 $3,093 $512 
RiverSource Life of NY261 244 40 
(1) Actual capital, as defined by the National Association of Insurance Commissioners for purposes of meeting regulatory capital requirements, includes statutory capital and surplus, plus certain statutory valuation reserves.
(2) Regulatory capital requirement is the company action level and is based on the statutory risk-based capital filing. The regulatory capital requirement is only required to be calculated annually.
In October 2023, the Federal Reserve Board (“FRB”) issued its final rule establishing a consolidated capital framework termed the “Building Block Approach” for savings and loan holding companies like Ameriprise Financial that are significantly engaged in
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insurance activities. The rule became effective January 1, 2024, with reporting to the FRB beginning in 2025. This rule does not impact the Company’s statutory risk-based capital requirements.
Forward-Looking Statements
This report contains forward-looking statements that reflect the Company’s plans, estimates and beliefs. The Company’s actual results could differ materially from those described in these forward-looking statements. Examples of such forward-looking statements include: 
statements of the Company’s plans, intentions, expectations, objectives, or goals, including those related to the introduction, cessation, terms or pricing of new or existing products and services and the consolidated tax rate;
statements about the expected trend rising interest rates will have on the investment portfolio yield;
statements about the expected trend in the shift to lower-risk products;
other statements about future economic performance, the performance of equity markets and interest rate variations and the economic performance of the United States and of global markets; and
statements of assumptions underlying such statements.
The words “believe,” “expect,” “anticipate,” “optimistic,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely,” “forecast,” “on track,” “project,” “continue,” “able to remain,” “resume,” “deliver,” “develop,” “evolve,” “drive,” “enable,” “flexibility,” “scenario,” “case”, “appear”, “expand” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from such statements.
Such factors include, but are not limited to:
market fluctuations and general economic and political factors, including volatility in the U.S. and global market conditions, client behavior and volatility in the markets for the Company’s products;
changes in interest rates;
adverse capital and credit market conditions or any downgrade in the Company’s credit ratings;
effects of competition and the Company’s larger competitors’ economies of scale;
impairment, negative performance or default by financial institutions or other counterparties;
declines in the Company’s investment management performance;
the Company’s and its affiliates’ ability to compete in attracting and retaining talent, including AFS attracting and retaining financial advisors;
poor performance of the Company’s variable products;
changes in valuation of securities and investments included in the Company’s assets;
the determination of the amount of allowances taken on loans and investments;
the illiquidity of the Company’s investments;
failures by other insurers that lead to higher assessments the Company owes to state insurance guaranty funds;
failures or defaults by counterparties to the Company’s reinsurance arrangements;
inadequate reserves for future policy benefits and claims or for future redemptions and maturities;
deviations from the Company’s assumptions regarding morbidity, mortality and persistency affecting the Company’s profitability;
changes to the Company’s or its affiliates’ reputation arising from employee or agent misconduct or otherwise;
direct or indirect effects of or responses to climate change;
interruptions or other failures in the Company’s operating systems and networks, including errors or failures caused by third-party service providers, interference or third-party attacks;
interruptions or other errors in the Company’s telecommunications or data processing systems;
identification and mitigation of risk exposure in market environments, new products, vendors and other types of risk;
occurrence of natural or man-made disasters and catastrophes;
legal and regulatory actions brought against the Company;
changes to laws and regulations that govern operation of the Company’s business;
changes in corporate tax laws and regulations and interpretations and determinations of tax laws impacting the Company’s products;
protection of the Company’s intellectual property and claims the Company infringes the intellectual property of others; and
changes in and the adoption of new accounting standards.
The Company cautions the reader that the foregoing list of factors is not exhaustive. There may also be other risks that the Company is unable to predict at this time that may cause actual results to differ materially from those in forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. The Company undertakes no obligation to update publicly or revise any forward-looking statements. The foregoing list of factors should be read in conjunction with the “Risk Factors” discussion included in Part I, Item 1A of the Company’s 2023 10-K.
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ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) designed to provide reasonable assurance that the information required to be reported in the Exchange Act filings is recorded, processed, summarized and reported within the time periods specified in and pursuant to Securities and Exchange Commission (“SEC”) regulations, including controls and procedures designed to ensure that this information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding the required disclosure. It should be noted that, because of inherent limitations, the Company’s disclosure controls and procedures, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the disclosure controls and procedures are met.
The Company’s management, under the supervision and with the participation of the Company’s principal executive officer and principal financial officer, evaluated the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures were effective at a reasonable level of assurance as of September 30, 2024.
Changes in Internal Control over Financial Reporting
There have not been any changes to RiverSource Life Insurance Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the third fiscal quarter of the year to which this report relates that have materially affected, or are reasonably likely to materially affect, RiverSource Life Insurance Company’s internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The information set forth in Note 17 to the Consolidated Financial Statements in Part I, Item 1 is incorporated herein by reference. 
ITEM 1A. RISK FACTORS
There have been no material changes in the risk factors provided in Part I, Item 1A of RiverSource Life Insurance Company’s 2023 Annual Report.
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ITEM 6. EXHIBITS
The following exhibits are filed as part of this Quarterly Report:
ExhibitDescription
Copy of Certificate of Incorporation of IDS Life Insurance Company, filed as Exhibit 3.1 to Post-Effective Amendment No. 5 to Registration Statement No. 33-28976, is incorporated by reference.
Copy of Certificate of Amendment of Certificate of Incorporation of IDS Life Insurance Company dated June 22, 2006, filed as Exhibit 3.1 to Form 8-K filed on January 5, 2007, is incorporated by reference.
Copy of Amended and Restated By-Laws of RiverSource Life Insurance Company dated June 22, 2006, filed as Exhibit 27(f)(2) to Post-Effective Amendment No. 28 to Registration Statement No. 333-69777, is incorporated by reference.
Certification of Gumer C. Alvero, Chairman and President, pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended.
Certification of Brian E. Hartert, Chief Financial Officer, pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended.
Certification of Gumer C. Alvero, Chairman and President and Brian E. Hartert, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101The following materials from RiverSource Life Insurance Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2024 are formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Balance Sheets at September 30, 2024 and December 31, 2023; (ii) Consolidated Statements of Income for the three and nine months ended September 30, 2024 and 2023; (iii) Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2024 and 2023; (iv) Consolidated Statements of Shareholder's Equity for the three and nine months ended September 30, 2024 and 2023; (v) Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023; and (vi) Notes to the Consolidated Financial Statements.
104The cover page from RiverSource Life Insurance Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2024 is formatted in iXBRL and contained in Exhibit 101.
* Filed electronically herewithin.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
RIVERSOURCE LIFE INSURANCE COMPANY
(Registrant)
Date:
November 1, 2024
By:
/s/ Gumer C. Alvero
Gumer C. Alvero
Director, Chairman and President
(Principal Executive Officer)

Date:
November 1, 2024
By:
/s/ Brian E. Hartert
Brian E. Hartert
Chief Financial Officer
(Principal Financial Officer)


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