I will tell you all the story of the three children. Loki was the son of Laufey the king of the Frost Giants. During the first giant wars Laufey fought a bitter battle with Surtr, a Fire Giant. Neither could gain the upper hand. Every time Laufey would cool Surtr the fire would weaken the frost and then it would go back and forth. Finally Bor, the King of Asgard, and father of Odin, stopped the great battle that threatened to destroy both Jotunheimr and Muspellheimr.
In a compromise for peace Laufey betrothed his only son Loki in marriage and Surtr offered up his daughter Angrboða as the bride. No mating of these two races of giants had ever been attempted but Bor swore it would bring peace to the nine realms.
Loki hated Angrboða and she him. They fought day and night as fire and ice will but in the end they endured and the giantess found herself with child.
At the time of birth both families met at the great hall the Frost Giants. The first child was a girl. She was born fully grown. Half her body was a beautiful woman with long black hair and almost white skin. Everyone in the hall marveled at the beauty of this woman child. That is until she turned. Where one half of her body was beautiful the other half was hideous. Worms crawled through an empty eye socket. Rotted flesh hung from cracked and yellowed bones. Women weeped when they saw her and she was named Hel.
Immediately after that a great wolf was born from Angrboða’s loins. The animal was the size of a longship with thick dark fur and red eyes. When it saw Hel it lay beside her and went to sleep. Angrboða called the wolf Fenrir, devourer of worlds.”
The third child that night was neither human form nor animal. A long green serpent crawled out of the screaming woman and curled itself around a pillar in the hall. Laufey called the serpent Jormungandr and as it grew it left the hall to encircle Midgard.
Suddenly Bor was standing among the giants. He struck his spear to the earth and ordered Hel to the underworld. He gave her a realm of her own that he called Helheim where all the dead would go before sentencing. When she claimed that all would pass through her portals the king of Asgard had to agree and that is why the Valkyries must first gain approval of Hel before taking fallen warriors to Valhalla.
Fenrir by this time was larger than the city of Laufeyshold and growing. Bor tapped the great beast once with his spear and the wolf disappeared. ‘I shall deal with him soon,’ Bor told the giants.
Finally the king of Asgard found the serpent squeezing the earth. Great upheavals were everywhere and the people of Midgard were afraid. Straddling the serpents’ tail the great God relieved himself. The serpent turned at the God and Bor finished his business in Jormungandr’s eyes. Enraged the serpents struck out at what he smelled as his enemy. Refusing to release his hold on Bor the Midgard Serpent holds his own tail in error.
And this is how Loki had three children.