Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2015

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Fair Value Hierarchy for Assets Measured at Fair Value on a Recurring Basis

The following tables illustrate the fair value hierarchy for those assets measured at fair value on a recurring basis at September 30, 2015, and December 31, 2014. We do not have any material liabilities carried at fair value. There were no transfers between Level 1 and Level 2.



(Dollars in millions)	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
At September 30, 2015			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Fixed maturities, available for sale:
Corporate	$	—	$	5,568	$	41	$	5,609
States, municipalities and political subdivisions	—		3,557		—		3,557
Commercial mortgage-backed	—		292		—		292
Government-sponsored enterprises	—		276		—		276
Foreign government	—		10		—		10
Convertibles and bonds with warrants attached	—		8		—		8
United States government	4		—		—		4
Subtotal	4		9,711		41		9,756
Common equities, available for sale	4,313		—		—		4,313
Nonredeemable preferred equities, available for sale	—		211		2		213
Short-term investments	—		75		—		75
Separate accounts taxable fixed maturities	—		754		—		754
Top Hat savings plan mutual funds and common equity (included in Other assets)	20		—		—		20
Total	$	4,337	$	10,751	$	43	$	15,131
At December 31, 2014
Fixed maturities, available for sale:
Corporate	$	—	$	5,508	$	18	$	5,526
States, municipalities and political subdivisions	—		3,443		—		3,443
Commercial mortgage-backed	—		259		—		259
Government-sponsored enterprises	—		208		—		208
Foreign government	—		10		—		10
Convertibles and bonds with warrants attached	—		7		—		7
United States government	7		—		—		7
Subtotal	7		9,435		18		9,460
Common equities, available for sale	4,679		—		—		4,679
Nonredeemable preferred equities, available for sale	—		177		2		179
Separate accounts taxable fixed maturities	—		731		—		731
Top Hat savings plan mutual funds and common equity (included in Other assets)	18		—		—		18
Total	$	4,704	$	10,343	$	20	$	15,067

Asset Fair Value Measurements Using Significant Unobservable Inputs (Level 3)



(Dollars in millions)	Asset fair value measurements using significant unobservable inputs (Level 3)
	Corporate fixed maturities		Commercial mortgage- backed fixed maturities		States, municipalities and political subdivisions fixed maturities			Nonredeemable preferred equities		Total
Beginning balance, June 30, 2015	$	18	$	—	$	1		$	2	$	21
Total gains or losses (realized/unrealized):
Included in net income	—		—		—			—		—
Included in other comprehensive income	1		—		—			—		1
Purchases	22		—		—			—		22
Sales	—		—		—			—		—
Transfers into Level 3	—		—		—			—		—
Transfers out of Level 3	—		—		(1		)	—		(1		)
Ending balance, September 30, 2015	$	41	$	—	$	—		$	2	$	43

Beginning balance, June 30, 2014	$	9	$	—	$	—		$	2	$	11
Total gains or losses (realized/unrealized):
Included in net income	—		—		—			—		—
Included in other comprehensive income	—		—		—			—		—
Purchases	—		—		—			—		—
Sales	—		—		—			—		—
Transfers into Level 3	19		—		—			—		19
Transfers out of Level 3	—		—		—			—		—
Ending balance, September 30, 2014	$	28	$	—	$	—		$	2	$	30

The following table provides the change in Level 3 assets for the nine months ended September 30:



(Dollars in millions)	Asset fair value measurements using significant unobservable inputs (Level 3)
		Corporate fixed maturities		Commercial mortgage- backed fixed maturities			States, municipalities and political subdivisions fixed maturities			Nonredeemable preferred equities		Total
Beginning balance, January 1, 2015		$	18	$	—		$	—		$	2	$	20
Total gains or losses (realized/unrealized):
Included in net income		—		—			—			—		—
Included in other comprehensive income		1		—			—			—		1
Purchases		22		—			—			—		22
Sales		—		—			—			—		—
Transfers into Level 3		—		—			1			—		1
Transfers out of Level 3		—		—			(1		)	—		(1		)
Ending balance, September 30, 2015		$	41	$	—		$	—		$	2	$	43

Beginning balance, January 1, 2014		$	2	$	—		$	—		$	2	$	4
Total gains or losses (realized/unrealized):
Included in net income		—		—			—			—		—
Included in other comprehensive income		—		—			—			—		—
Purchases		—		—			—			—		—
Sales		—		—			—			—		—
Transfers into Level 3		26		5			—			—		31
Transfers out of Level 3		—		(5		)	—			—		(5		)
Ending balance, September 30, 2014		$	28	$	—		$	—		$	2	$	30

Schedule of Carrying Values and Estimated Fair Values of Debt Instruments [Table Text Block]

This table summarizes the book value and principal amounts of our long-term debt:



(Dollars in millions)				Book value				Principal amount
				September 30,		December 31,		September 30,		December 31,
Interest rate		Year of issue		2015		2014		2015		2014
6.900	%	1998	Senior debentures, due 2028	$	28	$	28	$	28	$	28
6.920	%	2005	Senior debentures, due 2028	391		391		391		391
6.125	%	2004	Senior notes, due 2034	372		372		374		374
			Total	$	791	$	791	$	793	$	793

Fair Value of Life Policy Loans

The following table shows the fair value of our life policy loans included in other invested assets:



(Dollars in millions)	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
At September 30, 2015			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Life policy loans	$	—	$	—	$	40	$	40

At December 31, 2014
Life policy loans	$	—	$	—	$	39	$	39

Debt

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Fair Values of Deferred Annuities, Structured Settlements and Other Items

The following table shows fair values of our note payable and long-term debt:



(Dollars in millions)	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
At September 30, 2015			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Note payable	$	—	$	35	$	—	$	35
6.900% senior debentures, due 2028	—		34		—		34
6.920% senior debentures, due 2028	—		498		—		498
6.125% senior notes, due 2034	—		441		—		441
Total	$	—	$	1,008	$	—	$	1,008

At December 31, 2014
Note payable	$	—	$	49	$	—	$	49
6.900% senior debentures, due 2028	—		34		—		34
6.920% senior debentures, due 2028	—		496		—		496
6.125% senior notes, due 2034	—		449		—		449
Total	$	—	$	1,028	$	—	$	1,028

Deferred Annuities, Structured Settlements, And Other

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Fair Values of Deferred Annuities, Structured Settlements and Other Items

The following table shows fair values of our deferred annuities and structured settlements included in life policy and investment contract reserves:



(Dollars in millions)	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
At September 30, 2015			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Deferred annuities	$	—	$	—	$	892	$	892
Structured settlements	—		208		—		208
Total	$	—	$	208	$	892	$	1,100

At December 31, 2014
Deferred annuities	$	—	$	—	$	897	$	897
Structured settlements	—		217		—		217
Total	$	—	$	217	$	897	$	1,114