Investments

3 Months Ended

Mar. 31, 2020

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



(Dollars in millions)	Amortized cost		Gross unrealized				Fair value
At March 31, 2020	Amortized cost		gains		losses		Fair value
Fixed maturity securities:
Corporate	$	6,134	$	180	$	181	$	6,133
States, municipalities and political subdivisions	4,445		272		6		4,711
Commercial mortgage-backed	290		2		8		284
United States government	96		6		—		102
Government-sponsored enterprises	86		1		—		87
Foreign government	23		—		—		23
Total	$	11,074	$	461	$	195	$	11,340
At December 31, 2019
Fixed maturity securities:
Corporate	$	6,074	$	332	$	5	$	6,401
States, municipalities and political subdivisions	4,477		252		1		4,728
Commercial mortgage-backed	290		11		—		301
United States government	102		2		—		104
Government-sponsored enterprises	137		—		1		136
Foreign government	28		—		—		28
Total	$	11,108	$	597	$	7	$	11,698

The net unrealized investment gains in our fixed-maturity portfolio at March 31, 2020, 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 March 31, 2020, and December 31, 2019.

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 March 31, 2020	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Fixed maturity securities:
Corporate	$	2,168	$	176	$	52	$	5	$	2,220	$	181
States, municipalities and political subdivisions	76		5		3		1		79		6
Commercial mortgage-backed	163		8		—		—		163		8
United States government	—		—		—		—		—		—
Government-sponsored enterprises	—		—		—		—		—		—
Foreign government	15		—		—		—		15		—
Total	$	2,422	$	189	$	55	$	6	$	2,477	$	195
At December 31, 2019
Fixed maturity securities:
Corporate	$	199	$	2	$	118	$	3	$	317	$	5
States, municipalities and political subdivisions	98		1		10		—		108		1
Commercial mortgage-backed	6		—		—		—		6		—
United States government	—		—		4		—		4		—
Government-sponsored enterprises	26		1		51		—		77		1
Foreign government	11		—		—		—		11		—
Total	$	340	$	4	$	183	$	3	$	523	$	7

Contractual maturity dates for fixed-maturities investments were:



(Dollars in millions)	Amortized cost		Fair value		% of fair value
At March 31, 2020	Amortized cost		Fair value		% of fair value
Maturity dates:
Due in one year or less	$	502	$	502	4.4	%
Due after one year through five years	3,132		3,137		27.7
Due after five years through ten years	3,833		3,874		34.2
Due after ten years	3,607		3,827		33.7
Total	$	11,074	$	11,340	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 March 31,
	2020			2019
Investment income:
Interest	$	112		$	111
Dividends	53			46
Other	3			3
Total	168			160
Less investment expenses	3			3
Total	$	165		$	157

Investment gains and losses, net:
Equity securities:
Investment gains and losses on securities sold, net	$	(4	)	$	4
Unrealized gains and losses on securities still held, net	(1,649		)	652
Subtotal	(1,653		)	656
Fixed maturities:
Gross realized gains	2			2
Write-down of impaired securities	(77		)	—
Subtotal	(75		)	2

Other	3			5
Total	$	(1,725	)	$	663

The fair value of our common equities portfolio was $6.017 billion and $7.518 billion at March 31, 2020 and December 31, 2019, respectively. The financial, information technology, industrials, energy and consumer discretionary sectors experienced the most significant declines in fair value as our common equity portfolio has a similar sector distribution as the S&P 500 industry weightings. At March 31, 2020, Microsoft Corporation (Nasdaq:MSFT) was our largest single equity holding with a fair value of $395 million, which was 6.6% of our publicly traded common equities portfolio and 2.3% of the total investment portfolio.

During the three months ended March 31, 2020, there were no fixed-maturity securities with an allowance for credit losses and 12 fixed-maturity securities from the energy, real estate, consumer goods and technology & electronics sectors which are intended to be sold and were written down to fair value. During the three months ended March 31, 2019, there were no fixed-maturity securities other-than-temporarily impaired. There were no credit losses on fixed-maturity securities for which an allowance for credit losses has been recorded in other comprehensive income for the three months ended March 31, 2020. 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 months ended March 31, 2019.

At March 31, 2020, 605 fixed-maturity securities with a total unrealized loss of $195 million were in an unrealized loss position driven primarily by a market value decline of corporate bonds related to economic uncertainty from the pandemic impact. Of that total, 18 fixed-maturity securities from the energy, services, financial services, leisure, real estate and retail sectors had a fair value below 70% of amortized cost. At December 31, 2019, 38 fixed-maturity securities with a total unrealized loss of $3 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.