Investments

6 Months Ended

Jun. 30, 2019

The following table provides cost or amortized cost, gross unrealized gains, gross unrealized losses and fair value for our fixed-maturity securities:



(Dollars in millions)	Cost or amortized cost		Gross unrealized				Fair value
At June 30, 2019	Cost or amortized cost		gains		losses		Fair value
Fixed maturity securities:
Corporate	$	5,815	$	269	$	13	$	6,071
States, municipalities and political subdivisions	4,331		218		—		4,549
Commercial mortgage-backed	289		12		—		301
Government-sponsored enterprises	283		—		1		282
United States government	97		3		—		100
Foreign government	17		—		—		17
Total	$	10,832	$	502	$	14	$	11,320
At December 31, 2018
Fixed maturity securities:
Corporate	$	5,712	$	85	$	87	$	5,710
States, municipalities and political subdivisions	4,251		84		31		4,304
Commercial mortgage-backed	287		3		2		288
Government-sponsored enterprises	316		1		7		310
United States government	67		1		1		67
Foreign government	10		—		—		10
Total	$	10,643	$	174	$	128	$	10,689

The net unrealized investment gains in our fixed-maturity portfolio at June 30, 2019, are primarily the result of the continued low interest rate environment that increased the fair value of our fixed-maturity portfolio. Our commercial mortgage-backed securities had an average rating of Aa1/AA at June 30, 2019, and December 31, 2018. At June 30, 2019, Microsoft Corporation (Nasdaq:MSFT) was our largest single equity holding with a fair value of

$336 million, which was 4.9% of our publicly traded common equities portfolio and 1.8% of the total investment portfolio.

The table below provides fair values and gross unrealized losses by investment category and by the duration of the securities' continuous unrealized loss positions:



(Dollars in millions)	Less than 12 months				12 months or more				Total
At June 30, 2019	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Fixed maturity securities:
Corporate	$	78	$	2	$	294	$	11	$	372	$	13
States, municipalities and political subdivisions	13		—		21		—		34		—
Commercial mortgage-backed	—		—		5		—		5		—
Government-sponsored enterprises	7		—		117		1		124		1
United States government	5		—		4		—		9		—
Foreign government	1		—		—		—		1		—
Total	$	104	$	2	$	441	$	12	$	545	$	14
At December 31, 2018
Fixed maturity securities:
Corporate	$	2,082	$	51	$	501	$	36	$	2,583	$	87
States, municipalities and political subdivisions	823		18		340		13		1,163		31
Commercial mortgage-backed	77		—		64		2		141		2
Government-sponsored enterprises	49		1		211		6		260		7
United States government	—		—		33		1		33		1
Total	$	3,031	$	70	$	1,149	$	58	$	4,180	$	128

Contractual maturity dates for fixed-maturities investments were:



(Dollars in millions)	Amortized cost		Fair value		% of fair value
At June 30, 2019	Amortized cost		Fair value		% of fair value
Maturity dates:
Due in one year or less	$	491	$	496	4.4	%
Due after one year through five years	3,004		3,097		27.4
Due after five years through ten years	3,750		3,929		34.7
Due after ten years	3,587		3,798		33.5
Total	$	10,832	$	11,320	100.0	%

Actual maturities may differ from contractual maturities when there is a right to call or prepay obligations with or without call or prepayment penalties.

The following table provides investment income and investment gains and losses, net:



(Dollars in millions)	Three months ended June 30,						Six months ended June 30,
	2019			2018			2019			2018
Investment income:
Interest	$	111		$	112		$	222		$	222
Dividends	50			44			96			86
Other	2			1			5			2
Total	163			157			323			310
Less investment expenses	3			3			6			6
Total	$	160		$	154		$	317		$	304

Investment gains and losses, net:
Equity securities:
Investment gains and losses on securities sold, net	$	11		$	4		$	23		$	7
Unrealized gains and losses on securities still held, net	355			101			999			(97		)
Subtotal	366			105			1,022			(90		)
Fixed maturities:
Gross realized gains	1			3			3			7
Gross realized losses	(2		)	(1		)	(2		)	(1		)
Subtotal	(1		)	2			1			6

Other	(1		)	(2		)	4			(2		)
Total	$	364		$	105		$	1,027		$	(86	)

During the three and six months ended June 30, 2019 and 2018, there were no fixed-maturity securities other-than-temporarily impaired. There were no credit losses on fixed-maturity securities for which a portion of other-than-temporary impairment (OTTI) has been recognized in other comprehensive income for the three and six months ended June 30, 2019 and 2018.

At June 30, 2019, 100 fixed-maturity securities with a total unrealized loss of $12 million had been in an unrealized loss position for 12 months or more. Of that total, one fixed-maturity security had a fair value below 70% of amortized cost. At December 31, 2018, 400 fixed-maturity securities with a total unrealized loss of $58 million had been in an unrealized loss position for 12 months or more. Of that total, no fixed-maturity securities had fair values below 70% of amortized cost.