Fair Value (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

Assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis are summarized below.

June 30, 2013							Total Assets/(Liabilities) at Fair Value
(In millions)	Level 1		Level 2		Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	30	$	21,556	$	202	$	21,788
States, municipalities and political subdivisions	—		10,599		140		10,739
Asset-backed:
Residential mortgage-backed	—		4,668		428		5,096
Commercial mortgage-backed	—		1,844		165		2,009
Other asset-backed	—		560		387		947
Total asset-backed	—		7,072		980		8,052
U.S. Treasury and obligations of government-sponsored enterprises	147		29		—		176
Foreign government	98		446		—		544
Redeemable preferred stock	49		58		25		132
Total fixed maturity securities	324		39,760		1,347		41,431
Equity securities	134		52		13		199
Other invested assets	—		36		—		36
Short term investments	1,057		423		—		1,480
Life settlement contracts, included in Other assets	—		—		91		91
Separate account business	6		239		2		247
Total assets	$	1,521	$	40,510	$	1,453	$	43,484
Liabilities
Derivative financial instruments, included in Other liabilities	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	—	$	—

December 31, 2012									Total Assets/(Liabilities) at Fair Value
(In millions)	Level 1		Level 2			Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	6	$	22,011		$	219		$	22,236
States, municipalities and political subdivisions	—		10,687			96			10,783
Asset-backed:
Residential mortgage-backed	—		5,507			413			5,920
Commercial mortgage-backed	—		1,693			129			1,822
Other asset-backed	—		584			368			952
Total asset-backed	—		7,784			910			8,694
U.S. Treasury and obligations of government-sponsored enterprises	158		24			—			182
Foreign government	140		473			—			613
Redeemable preferred stock	40		59			26			125
Total fixed maturity securities	344		41,038			1,251			42,633
Equity securities	117		98			34			249
Other invested assets	—		58			1			59
Short term investments	987		799			6			1,792
Life settlement contracts, included in Other assets	—		—			100			100
Separate account business	4		306			2			312
Total assets	$	1,452	$	42,299		$	1,394		$	45,145
Liabilities
Derivative financial instruments, included in Other liabilities	$	—	$	(2	)	$	(1	)	$	(3	)
Total liabilities	$	—	$	(2	)	$	(1	)	$	(3	)

Table of reconciliation for assets and liablities measured at fair value on a recurring basis using significant unobservable inputs

The tables below present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended June 30, 2013 and 2012.

Level 3 (In millions)	Balance at April 1, 2013			Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*			Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance at June 30, 2013		Unrealized gains (losses) on Level 3 assets and liabilities held at June 30, 2013 recognized in net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	302		$	1		$	(3	)	$	13	$	(73	)	$	(6	)	$	—	$	(32	)	$	202	$	(1	)
States, municipalities and political subdivisions	129			—			4			37		(32		)	(3		)	5		—			140		—
Asset-backed:
Residential mortgage-backed	450			(1		)	(1		)	50		(10		)	(21		)	4		(43		)	428		(2		)
Commercial mortgage-backed	177			—			4			5		—			(2		)	21		(40		)	165		—
Other asset-backed	396			—			(3		)	38		(33		)	(11		)	—		—			387		(1		)
Total asset-backed	1,023			(1		)	—			93		(43		)	(34		)	25		(83		)	980		(3		)
Redeemable preferred stock	26			—			(1		)	—		—			—			—		—			25		—
Total fixed maturity securities	1,480			—			—			143		(148		)	(43		)	30		(115		)	1,347		(4		)
Equity securities	19			(5		)	(1		)	—		—			—			—		—			13		(5		)
Other invested assets, including derivatives, net	(1		)	—			—			—		—			1			—		—			—		—
Short term investments	5			—			—			—		(5		)	—			—		—			—		—
Life settlement contracts	95			4			—			—		—			(8		)	—		—			91		(1		)
Separate account business	2			—			—			—		—			—			—		—			2		—
Total	$	1,600		$	(1	)	$	(1	)	$	143	$	(153	)	$	(50	)	$	30	$	(115	)	$	1,453	$	(10	)

Level 3 (In millions)	Balance at April 1, 2012		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance at June 30, 2012		Unrealized gains (losses) on Level 3 assets and liabilities held at June 30, 2012 recognized in net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	486	$	3	$	2		$	68	$	(27	)	$	(13	)	$	9	$	(40	)	$	488	$	—
States, municipalities and political subdivisions	173		—		1			—		—			(85		)	—		—			89		—
Asset-backed:
Residential mortgage-backed	447		1		(18		)	22		—			(9		)	—		—			443		—
Commercial mortgage-backed	105		2		4			87		(12		)	(4		)	—		(16		)	166		—
Other asset-backed	384		2		(1		)	182		(99		)	(34		)	—		—			434		—
Total asset-backed	936		5		(15		)	291		(111		)	(47		)	—		(16		)	1,043		—
Redeemable preferred stock	53		—		—			—		(26		)	—			—		—			27		—
Total fixed maturity securities	1,648		8		(12		)	359		(164		)	(145		)	9		(56		)	1,647		—
Equity securities	74		—		19			15		(15		)	—			—		—			93		(1		)
Other invested assets, including derivatives, net	10		—		—			—		—			—			—		—			10		—
Short term investments	—		—		—			4		—			—			—		—			4		—
Life settlement contracts	115		20		—			—		—			(19		)	—		—			116		3
Separate account business	4		—		—			—		(1		)	—			—		—			3		—
Total	$	1,851	$	28	$	7		$	378	$	(180	)	$	(164	)	$	9	$	(56	)	$	1,873	$	2

The tables below present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2013 and 2012.

Level 3 (In millions)	Balance at January 1, 2013		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*			Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance at June 30, 2013		Unrealized gains (losses) on Level 3 assets and liabilities held at June 30, 2013 recognized in net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	219	$	1		$	(1	)	$	123	$	(90	)	$	(26	)	$	26	$	(50	)	$	202	$	(2	)
States, municipalities and political subdivisions	96		(3		)	4			122		(79		)	(5		)	5		—			140		—
Asset-backed:
Residential mortgage-backed	413		2			(1		)	111		(10		)	(32		)	4		(59		)	428		(2		)
Commercial mortgage-backed	129		1			9			78		—			(9		)	21		(64		)	165		—
Other asset-backed	368		3			(2		)	174		(132		)	(24		)	—		—			387		(1		)
Total asset-backed	910		6			6			363		(142		)	(65		)	25		(123		)	980		(3		)
Redeemable preferred stock	26		—			(1		)	—		—			—			—		—			25		—
Total fixed maturity securities	1,251		4			8			608		(311		)	(96		)	56		(173		)	1,347		(5		)
Equity securities	34		(20		)	—			—		—			—			—		(1		)	13		(20		)
Other invested assets, including derivatives, net	—		—			—			—		(1		)	1			—		—			—		—
Short term investments	6		—			—			—		(6		)	—			—		—			—		—
Life settlement contracts	100		11			—			—		—			(20		)	—		—			91		(1		)
Separate account business	2		—			—			—		—			—			—		—			2		—
Total	$	1,393	$	(5	)	$	8		$	608	$	(318	)	$	(115	)	$	56	$	(174	)	$	1,453	$	(26	)

Level 3 (In millions)	Balance at January 1, 2012		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance at June 30, 2012		Unrealized gains (losses) on Level 3 assets and liabilities held at June 30, 2012 recognized in net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	482	$	6	$	6		$	147	$	(113	)	$	(32	)	$	42	$	(50	)	$	488	$	—
States, municipalities and political subdivisions	171		—		3			—		—			(85		)	—		—			89		—
Asset-backed:
Residential mortgage-backed	452		2		(22		)	60		—			(16		)	—		(33		)	443		—
Commercial mortgage-backed	59		2		8			129		(12		)	(4		)	—		(16		)	166		—
Other asset-backed	343		6		3			358		(176		)	(59		)	—		(41		)	434		—
Total asset-backed	854		10		(11		)	547		(188		)	(79		)	—		(90		)	1,043		—
Redeemable preferred stock	—		—		—			53		(26		)	—			—		—			27		—
Total fixed maturity securities	1,507		16		(2		)	747		(327		)	(196		)	42		(140		)	1,647		—
Equity securities	67		—		16			26		(16		)	—			—		—			93		(3		)
Other invested assets, including derivatives, net	10		—		—			—		—			—			—		—			10		—
Short term investments	27		—		—			16		—			(39		)	—		—			4		—
Life settlement contracts	117		23		—			—		—			(24		)	—		—			116		3
Separate account business	23		—		—			—		(20		)	—			—		—			3		—
Total	$	1,751	$	39	$	14		$	789	$	(363	)	$	(259	)	$	42	$	(140	)	$	1,873	$	—

Quantitative information about significant unobservable inputs in the fair value measurement of level 3 assets

The table below presents quantitative information about the significant unobservable inputs utilized by the Company in the fair value measurements of Level 3 assets. Valuations for assets and liabilities not presented in the table below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company.

Assets (In millions)	Fair Value at June 30, 2013		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	106	Discounted cash flow	Expected call date	1.6 - 3.5 years (3.1 years)
				Credit spread	1.95% - 7.95% (2.67%)
	$	83	Market approach	Private offering price	$36.32 - $113.76 ($101.70)
Equity securities	$	13	Market approach	Private offering price	$33.73 - $4,017.00 per share ($936.89 per share)
Life settlement contracts	$	91	Discounted cash flow	Discount rate risk premium	9%
				Mortality assumption	69% - 883% (209.2%)

Assets (In millions)	Fair Value at December 31, 2012		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	121	Discounted cash flow	Expected call date	3.3 - 5.3 years (4.3 years)
				Credit spread adjustment	0.02% - 0.48% (0.17%)
	$	72	Market approach	Private offering price	$42.39 - $102.32 ($100.11)
Equity securities	$	34	Market approach	Private offering price	$4.54 - $3,842.00 per share ($571.17 per share)
Life settlement contracts	$	100	Discounted cash flow	Discount rate risk premium	9%
				Mortality assumption	69% - 883% (208.9%)

Carrying amount and estimated fair value of financial instrument assets and liabilities not measured at fair value

The carrying amount and estimated fair value of the Company's financial instrument assets and liabilities which are not measured at fair value on the Condensed Consolidated Balance Sheets are listed in the tables below.

June 30, 2013	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Financial assets
Notes receivable for the issuance of common stock	$	24	$	—	$	—	$	24	$	24
Mortgage loans	437		—		—		449		449
Financial liabilities
Premium deposits and annuity contracts	$	75	$	—	$	—	$	76	$	76
Short term debt	13		—		13		—		13
Long term debt	2,558		—		2,912		—		2,912

December 31, 2012	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Financial assets
Notes receivable for the issuance of common stock	$	21	$	—	$	—	$	21	$	21
Mortgage loans	401		—		—		418		418
Financial liabilities
Premium deposits and annuity contracts	$	100	$	—	$	—	$	104	$	104
Short term debt	13		—		13		—		13
Long term debt	2,557		—		3,016		—		3,016