Investments (Tables)

12 Months Ended

Dec. 31, 2013

Net Investment Income



Years ended December 31
(In millions)	2013			2012			2011
Fixed maturity securities	$	1,998		$	2,022		$	2,011
Short term investments	3			5			8
Limited partnership investments	451			251			48
Equity securities	12			12			20
Mortgage loans	23			17			9
Trading portfolio	17			24			9
Other	2			7			7
Gross investment income	2,506			2,338			2,112
Investment expense	(56		)	(56		)	(58		)
Net investment income	$	2,450		$	2,282		$	2,054

Net realized investment gains (losses)

Net Realized Investment Gains (Losses)



Years ended December 31
(In millions)	2013			2012			2011
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	201		$	232		$	289
Gross realized losses	(146		)	(149		)	(311		)
Net realized investment gains (losses) on fixed maturity securities	55			83			(22		)
Equity securities:
Gross realized gains	13			19			10
Gross realized losses	(35		)	(42		)	(11		)
Net realized investment gains (losses) on equity securities	(22		)	(23		)	(1		)
Derivatives	(9		)	(2		)	—
Short term investments and other	7			5			21
Net realized investment gains (losses)	$	31		$	63		$	(2	)

Net change in unrealized gains (losses) on investments

Net Change in Unrealized Gains



Years ended December 31
(In millions)	2013			2012			2011
Net change in unrealized gains on investments:
Fixed maturity securities	$	(2,541	)	$	1,871		$	1,442
Equity securities	(15		)	5			(2		)
Other	—			(1		)	(3		)
Total net change in unrealized gains on investments	$	(2,556	)	$	1,875		$	1,437

Components of net other-than-temporary impairment losses recognized in earnings

The components of OTTI losses recognized in earnings by asset type are summarized in the following table.



Years ended December 31
(In millions)	2013		2012		2011
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	22	$	27	$	95
States, municipalities and political subdivisions	—		34		—
Asset-backed:
Residential mortgage-backed	19		50		105
Other asset-backed	2		—		6
Total asset-backed	21		50		111
U.S. Treasury and obligations of government-sponsored enterprises	—		1		—
Total fixed maturity securities available-for-sale	43		112		206
Equity securities available-for-sale:
Common stock	8		6		8
Preferred stock	26		36		1
Total equity securities available-for-sale	34		42		9
Short term investments	1		—		1
OTTI losses recognized in earnings	$	78	$	154	$	216

Summary of fixed maturity and equity securities

Summary of Fixed Maturity and Equity Securities



December 31, 2013	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	19,352	$	1,645	$	135	$	20,862	$	—
States, municipalities and political subdivisions	11,281		548		272		11,557		—
Asset-backed:
Residential mortgage-backed	4,940		123		92		4,971		(37		)
Commercial mortgage-backed	1,995		90		22		2,063		(3		)
Other asset-backed	945		13		3		955		—
Total asset-backed	7,880		226		117		7,989		(40		)
U.S. Treasury and obligations of government-sponsored enterprises	139		6		1		144		—
Foreign government	531		15		3		543		—
Redeemable preferred stock	92		10		—		102		—
Total fixed maturity securities available-for-sale	39,275		2,450		528		41,197		$	(40	)
Total fixed maturity securities trading	36		—		—		36
Equity securities available-for-sale:
Common stock	36		9		—		45
Preferred stock	143		1		4		140
Total equity securities available-for-sale	179		10		4		185
Total	$	39,490	$	2,460	$	532	$	41,418



December 31, 2012	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	19,530	$	2,698	$	21	$	22,207	$	—
States, municipalities and political subdivisions	9,372		1,455		44		10,783		—
Asset-backed:
Residential mortgage-backed	5,745		246		71		5,920		(28		)
Commercial mortgage-backed	1,692		147		17		1,822		(3		)
Other asset-backed	929		23		—		952		—
Total asset-backed	8,366		416		88		8,694		(31		)
U.S. Treasury and obligations of government-sponsored enterprises	172		11		1		182		—
Foreign government	588		25		—		613		—
Redeemable preferred stock	113		13		1		125		—
Total fixed maturity securities available-for-sale	38,141		4,618		155		42,604		$	(31	)
Total fixed maturity securities trading	29		—		—		29
Equity securities available-for-sale:
Common stock	38		14		—		52
Preferred stock	190		7		—		197
Total equity securities available-for-sale	228		21		—		249
Total	$	38,398	$	4,639	$	155	$	42,882

Securities in a gross unrealized loss position

Securities in a Gross Unrealized Loss Position



	Less than 12 Months				12 Months or Longer				Total
December 31, 2013	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	3,592	$	129	$	72	$	6	$	3,664	$	135
States, municipalities and political subdivisions	3,251		197		129		75		3,380		272
Asset-backed:
Residential mortgage-backed	1,293		29		343		63		1,636		92
Commercial mortgage-backed	640		22		—		—		640		22
Other asset-backed	269		3		—		—		269		3
Total asset-backed	2,202		54		343		63		2,545		117
U.S. Treasury and obligations of government-sponsored enterprises	13		1		—		—		13		1
Foreign government	111		3		—		—		111		3
Total fixed maturity securities available-for-sale	9,169		384		544		144		9,713		528
Equity securities available-for-sale:
Preferred stock	87		4		—		—		87		4
Total	$	9,256	$	388	$	544	$	144	$	9,800	$	532



	Less than 12 Months				12 Months or Longer				Total
December 31, 2012	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	846	$	13	$	108	$	8	$	954	$	21
States, municipalities and political subdivisions	254		5		165		39		419		44
Asset-backed:
Residential mortgage-backed	583		5		452		66		1,035		71
Commercial mortgage-backed	85		2		141		15		226		17
Total asset-backed	668		7		593		81		1,261		88
U.S. Treasury and obligations of government-sponsored enterprises	23		1		—		—		23		1
Redeemable preferred stock	28		1		—		—		28		1
Total	$	1,819	$	27	$	866	$	128	$	2,685	$	155

The following table summarizes the activity for the years ended December 31, 2013, 2012 and 2011 related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held at December 31, 2013, 2012 and 2011 for which a portion of an OTTI loss was recognized in Other comprehensive income.



Years ended December 31
(In millions)	2013			2012			2011
Beginning balance of credit losses on fixed maturity securities	$	95		$	92		$	141
Additional credit losses for securities for which an OTTI loss was previously recognized	2			23			39
Credit losses for securities for which an OTTI loss was not previously recognized	—			2			11
Reductions for securities sold during the period	(23		)	(14		)	(67		)
Reductions for securities the Company intends to sell or more likely than not will be required to sell	—			(8		)	(32		)
Ending balance of credit losses on fixed maturity securities	$	74		$	95		$	92

Contractual maturity

Contractual Maturity



	December 31, 2013				December 31, 2012
(In millions)	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
Due in one year or less	$	2,420	$	2,455	$	1,648	$	1,665
Due after one year through five years	9,496		10,068		13,603		14,442
Due after five years through ten years	11,667		11,954		8,726		9,555
Due after ten years	15,692		16,720		14,164		16,942
Total	$	39,275	$	41,197	$	38,141	$	42,604

- Definition

Tabular disclosure of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

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