Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2016

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 June 30, 2016, and December 31, 2015. 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 June 30, 2016			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Fixed maturities, available for sale:
Corporate	$	—	$	5,785	$	52	$	5,837
States, municipalities and political subdivisions	—		3,802		—		3,802
Commercial mortgage-backed	—		310		—		310
Government-sponsored enterprises	—		170		—		170
Foreign government	—		10		—		10
Convertibles and bonds with warrants attached	—		5		—		5
United States government	4		—		—		4
Subtotal	4		10,082		52		10,138
Common equities, available for sale	5,017		—		—		5,017
Nonredeemable preferred equities, available for sale	—		225		—		225
Separate accounts taxable fixed maturities	—		754		1		755
Top Hat savings plan mutual funds and common equity (included in Other assets)	23		—		—		23
Total	$	5,044	$	11,061	$	53	$	16,158
At December 31, 2015
Fixed maturities, available for sale:
Corporate	$	—	$	5,402	$	51	$	5,453
States, municipalities and political subdivisions	—		3,611		—		3,611
Commercial mortgage-backed	—		289		—		289
Government-sponsored enterprises	—		278		—		278
Foreign government	—		10		—		10
Convertibles and bonds with warrants attached	—		5		—		5
United States government	4		—		—		4
Subtotal	4		9,595		51		9,650
Common equities, available for sale	4,485		—		—		4,485
Nonredeemable preferred equities, available for sale	—		218		3		221
Separate accounts taxable fixed maturities	—		736		1		737
Top Hat savings plan mutual funds and common equity (included in Other assets)	21		—		—		21
Total	$	4,510	$	10,549	$	55	$	15,114

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			Separate accounts taxable fixed maturities		States, municipalities and political subdivisions fixed maturities		Nonredeemable preferred equities			Total
Beginning balance, April 1, 2016	$	51		$	1	$	—	$	2		$	54
Total gains or losses (realized/unrealized):
Included in net income	—			—		—		—			—
Included in other comprehensive income	—			—		—		—			—
Purchases	17			—		—		—			17
Sales	—			—		—		(2		)	(2		)
Transfers into Level 3	—			—		—		—			—
Transfers out of Level 3	(16		)	—		—		—			(16		)
Ending balance, June 30, 2016	$	52		$	1	$	—	$	—		$	53

Beginning balance, April 1, 2015	$	18		$	—	$	1	$	2		$	21
Total gains or losses (realized/unrealized):
Included in net income	—			—		—		—			—
Included in other comprehensive income	—			—		—		—			—
Purchases	—			—		—		—			—
Sales	—			—		—		—			—
Transfers into Level 3	—			—		—		—			—
Transfers out of Level 3	—			—		—		—			—
Ending balance, June 30, 2015	$	18		$	—	$	1	$	2		$	21

The following table provides the change in Level 3 assets for the six months ended June 30:



(Dollars in millions)	Asset fair value measurements using significant unobservable inputs (Level 3)
		Corporate fixed maturities			Separate accounts taxable fixed maturities		States, municipalities and political subdivisions fixed maturities		Nonredeemable preferred equities			Total
Beginning balance, January 1, 2016		$	51		$	1	$	—	$	3		$	55
Total gains or losses (realized/unrealized):
Included in net income		—			—		—		—			—
Included in other comprehensive income		—			—		—		(1		)	(1		)
Purchases		22			—		—		—			22
Sales		—			—		—		(2		)	(2		)
Transfers into Level 3		—			—		—		—			—
Transfers out of Level 3		(21		)	—		—		—			(21		)
Ending balance, June 30, 2016		$	52		$	1	$	—	$	—		$	53

Beginning balance, January 1, 2015		$	18		$	—	$	—	$	2		$	20
Total gains or losses (realized/unrealized):
Included in net income		—			—		—		—			—
Included in other comprehensive income		—			—		—		—			—
Purchases		—			—		—		—			—
Sales		—			—		—		—			—
Transfers into Level 3		—			—		1		—			1
Transfers out of Level 3		—			—		—		—			—
Ending balance, June 30, 2015		$	18		$	—	$	1	$	2		$	21

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
				June 30,		December 31,		June 30,		December 31,
Interest rate		Year of issue		2016		2015		2016		2015
6.900	%	1998	Senior debentures, due 2028	$	26	$	26	$	28	$	28
6.920	%	2005	Senior debentures, due 2028	391		391		391		391
6.125	%	2004	Senior notes, due 2034	369		369		374		374
			Total	$	786	$	786	$	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 June 30, 2016			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Life policy loans	$	—	$	—	$	42	$	42

At December 31, 2015
Life policy loans	$	—	$	—	$	40	$	40

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 June 30, 2016			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Note payable	$	—	$	28	$	—	$	28
6.900% senior debentures, due 2028	—		35		—		35
6.920% senior debentures, due 2028	—		516		—		516
6.125% senior notes, due 2034	—		457		—		457
Total	$	—	$	1,036	$	—	$	1,036

At December 31, 2015
Note payable	$	—	$	35	$	—	$	35
6.900% senior debentures, due 2028	—		31		—		31
6.920% senior debentures, due 2028	—		480		—		480
6.125% senior notes, due 2034	—		425		—		425
Total	$	—	$	971	$	—	$	971

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 June 30, 2016			Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Deferred annuities	$	—	$	—	$	928	$	928
Structured settlements	—		220		—		220
Total	$	—	$	220	$	928	$	1,148

At December 31, 2015
Deferred annuities	$	—	$	—	$	886	$	886
Structured settlements	—		208		—		208
Total	$	—	$	208	$	886	$	1,094