Fair value measurements (Tables)

3 Months Ended

Mar. 31, 2016

Financial assets and liabilities measured at fair value on a recurring basis

Our financial assets and liabilities are summarized below as of March 31, 2016 and December 31, 2015 with fair values shown according to the fair value hierarchy (in millions). The carrying values of cash and cash equivalents, receivable and accounts payable, accruals and other liabilities are considered to be reasonable estimates of their fair values.


	Carrying Value			Fair Value			Quoted Prices (Level 1)			Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)
March 31, 2016
Investments in fixed maturity securities:
U.S. Treasury, U.S. government corporations and agencies		$	3,333		$	3,333		$	2,361		$	972		$	—
States, municipalities and political subdivisions			1,565			1,565			—			1,565			—
Foreign governments			10,458			10,458			8,083			2,375			—
Corporate bonds			7,828			7,828			—			7,723			105
Mortgage-backed securities			1,373			1,373			—			1,373			—
Investments in equity securities			106,420			106,420			106,384			35			1
Investment in Kraft Heinz common stock			15,810			25,567			25,567			—			—
Investment in Kraft Heinz Preferred Stock			7,710			8,446			—			—			8,446
Other investments			19,810			19,810			328			—			19,482
Loans and finance receivables			12,925			13,202			—			15			13,187
Derivative contract assets ⁽¹⁾			114			114			—			2			112
Derivative contract liabilities:
Railroad, utilities and energy ⁽¹⁾			267			267			10			214			43
Finance and financial products:
Equity index put options			4,348			4,348			—			—			4,348
Credit default			298			298			—			—			298
Notes payable and other borrowings:
Insurance and other			28,073			28,941			—			28,941			—
Railroad, utilities and energy			58,110			66,246			—			66,246			—
Finance and financial products			15,356			16,042			—			15,616			426
December 31, 2015
Investments in fixed maturity securities:
U.S. Treasury, U.S. government corporations and agencies		$	3,427		$	3,427		$	2,485		$	942		$	—
States, municipalities and political subdivisions			1,764			1,764			—			1,764			—
Foreign governments			11,468			11,468			9,188			2,280			—
Corporate bonds			7,926			7,926			—			7,826			100
Mortgage-backed securities			1,442			1,442			—			1,442			—
Investments in equity securities			111,822			111,822			111,786			35			1
Investment in Kraft Heinz common stock			15,714			23,679			23,679			—			—
Investment in Kraft Heinz Preferred Stock			7,710			8,363			—			—			8,363
Other investments			21,717			21,717			315			—			21,402
Loans and finance receivables			12,772			13,112			—			16			13,096
Derivative contract assets ⁽¹⁾			103			103			—			5			98
Derivative contract liabilities:
Railroad, utilities and energy ⁽¹⁾			237			237			13			177			47
Finance and financial products:
Equity index put options			3,552			3,552			—			—			3,552
Credit default			284			284			—			—			284
Notes payable and other borrowings:
Insurance and other			14,599			14,773			—			14,773			—
Railroad, utilities and energy			57,739			62,471			—			62,471			—
Finance and financial products			11,951			12,363			—			11,887			476

⁽¹⁾

Assets are included in other assets and liabilities are included in accounts payable, accruals and other liabilities.

Reconciliations of assets and liabilities measured and carried at fair value on a recurring basis with the use of significant unobservable inputs (Level 3)

Reconciliations of assets and liabilities measured and carried at fair value on a recurring basis with the use of significant unobservable inputs (Level 3) for the three months ending March 31, 2016 and 2015 follow (in millions).


	Investments in fixed maturity securities				Investments in equity securities and other investments				Net derivative contract liabilities
Three months ending March 31, 2016
Balance at December 31, 2015		$	100			$	21,403			$	(3,785	)
Gains (losses) included in:
Earnings			—				—				(766	)
Other comprehensive income			2				(1,920	)			(6	)
Regulatory assets and liabilities			—				—				(6	)
Acquisitions, dispositions and settlements			4				—				(14	)
Transfers into/out of Level 3			(1	)			—				—

Balance at March 31, 2016		$	105			$	19,483			$	(4,577	)

Three months ending March 31, 2015
Balance at December 31, 2014		$	8			$	21,996			$	(4,759	)
Gains (losses) included in:
Earnings			—				—				1,347
Other comprehensive income			—				(1,445	)			1
Regulatory assets and liabilities			—				—				(3	)
Dispositions and settlements			(1	)			—				(24	)
Transfers into/out of Level 3			—				—				3

Balance at March 31, 2015		$	7			$	20,551			$	(3,435	)

Fair value assets and liabilities measured on recurring basis, unobservable inputs, additional information

Quantitative information as of March 31, 2016, with respect to assets and liabilities measured and carried at fair value on a recurring basis with the use of significant unobservable inputs (Level 3) follows (in millions).


	Fair Value		Principal Valuation Techniques	Unobservable Inputs	Weighted Average
Other investments:

Preferred stocks	$	14,995	Discounted cash flow	Expected duration	6 years

				Discount for transferability restrictions and subordination	134 basis points

Common stock warrants		4,487	Warrant pricing model	Discount for transferability and hedging restrictions	8%

Net derivative liabilities:

Equity index put options		4,348	Option pricing model	Volatility	21%

Credit default municipalities		298	Discounted cash flow	Credit spreads	31 basis points