Investments (Tables)

6 Months Ended

Jun. 30, 2016

Investments [Abstract]

Net investment income

The significant components of Net investment income are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2016			2015			2016			2015
Fixed maturity securities	$	449		$	452		$	895		$	895
Equity securities	4			3			7			6
Limited partnership investments	46			48			32			162
Mortgage loans	13			9			22			17
Short term investments	1			—			4			2
Trading portfolio	4			3			6			5
Gross investment income	517			515			966			1,087
Investment expense	(15		)	(15		)	(29		)	(29		)
Net investment income	$	502		$	500		$	937		$	1,058

Net realized investment gains (losses)

Net realized investment gains (losses) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2016			2015			2016			2015
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	40		$	36		$	85		$	69
Gross realized losses	(24		)	(48		)	(86		)	(69		)
Net realized investment gains (losses) on fixed maturity securities	16			(12		)	(1		)	—
Equity securities:
Gross realized gains	4			—			4			1
Gross realized losses	(1		)	(1		)	(6		)	(2		)
Net realized investment gains (losses) on equity securities	3			(1		)	(2		)	(1		)
Derivative financial instruments	(6		)	11			(13		)	10
Short term investments and other	3			2			(4		)	1
Net realized investment gains (losses)	$	16		$	—		$	(20	)	$	10

Components of net other than temporary impairment losses recognized in earnings by asset type

The components of Net other-than-temporary impairment (OTTI) losses recognized in earnings by asset type are presented in the following table.

Periods ended June 30	Three Months				Six Months
(In millions)	2016		2015		2016		2015
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	13	$	11	$	29	$	16
States, municipalities and political subdivisions	—		13		—		18
Asset-backed:
Residential mortgage-backed	1		5		1		6
Other asset-backed	1		1		3		1
Total asset-backed	2		6		4		7
Total fixed maturity securities available-for-sale	15		30		33		41
Equity securities available-for-sale -- Common stock	—		—		5		1
Short term investments	—		1		—		1
OTTI losses recognized in earnings	$	15	$	31	$	38	$	43

Summary of fixed maturity and equity securities

The following tables present a summary of fixed maturity and equity securities.

June 30, 2016	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,613	$	1,684	$	93	$	19,204	$	(1	)
States, municipalities and political subdivisions	11,661		2,114		2		13,773		(25		)
Asset-backed:
Residential mortgage-backed	4,994		215		20		5,189		(21		)
Commercial mortgage-backed	2,080		91		8		2,163		—
Other asset-backed	928		8		5		931		—
Total asset-backed	8,002		314		33		8,283		(21		)
U.S. Treasury and obligations of government-sponsored enterprises	81		11		—		92		—
Foreign government	438		22		—		460		—
Redeemable preferred stock	33		2		—		35		—
Total fixed maturity securities available-for-sale	37,828		4,147		128		41,847		$	(47	)
Total fixed maturity securities trading	10						10
Equity securities available-for-sale:
Common stock	20		5		2		23
Preferred stock	97		6		3		100
Total equity securities available-for-sale	117		11		5		123
Total	$	37,955	$	4,158	$	133	$	41,980

December 31, 2015	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,080	$	1,019	$	342	$	17,757	$	—
States, municipalities and political subdivisions	11,729		1,453		8		13,174		(4		)
Asset-backed:
Residential mortgage-backed	4,935		154		17		5,072		(37		)
Commercial mortgage-backed	2,154		55		12		2,197		—
Other asset-backed	923		6		8		921		—
Total asset-backed	8,012		215		37		8,190		(37		)
U.S. Treasury and obligations of government-sponsored enterprises	62		5		—		67		—
Foreign government	334		13		1		346		—
Redeemable preferred stock	33		2		—		35		—
Total fixed maturity securities available-for-sale	37,250		2,707		388		39,569		$	(41	)
Total fixed maturity securities trading	3						3
Equity securities available-for-sale:
Common stock	46		3		1		48
Preferred stock	145		7		3		149
Total equity securities available-for-sale	191		10		4		197
Total	$	37,444	$	2,717	$	392	$	39,769

Securities in a gross unrealized loss position

The following tables present the estimated fair value and gross unrealized losses of fixed maturity and equity securities in a gross unrealized loss position by the length of time in which the securities have continuously been in that position.

	Less than 12 Months				12 Months or Longer				Total
June 30, 2016	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	1,032	$	43	$	562	$	50	$	1,594	$	93
States, municipalities and political subdivisions	68		2		10		—		78		2
Asset-backed:
Residential mortgage-backed	293		8		234		12		527		20
Commercial mortgage-backed	386		7		118		1		504		8
Other asset-backed	306		5		5		—		311		5
Total asset-backed	985		20		357		13		1,342		33
Foreign government	8		—		5		—		13		—
Total fixed maturity securities available-for-sale	2,093		65		934		63		3,027		128
Equity securities available-for-sale:
Common stock	4		2		—		—		4		2
Preferred stock	23		3		—		—		23		3
Total equity securities available-for-sale	27		5		—		—		27		5
Total	$	2,120	$	70	$	934	$	63	$	3,054	$	133

	Less than 12 Months				12 Months or Longer				Total
December 31, 2015	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	4,882	$	302	$	162	$	40	$	5,044	$	342
States, municipalities and political subdivisions	338		8		75		—		413		8
Asset-backed:
Residential mortgage-backed	963		9		164		8		1,127		17
Commercial mortgage-backed	652		10		96		2		748		12
Other asset-backed	552		8		5		—		557		8
Total asset-backed	2,167		27		265		10		2,432		37
U.S. Treasury and obligations of government-sponsored enterprises	4		—		—		—		4		—
Foreign government	54		1		—		—		54		1
Redeemable preferred stock	3		—		—		—		3		—
Total fixed maturity securities available-for-sale	7,448		338		502		50		7,950		388
Equity securities available-for-sale:
Common stock	3		1		—		—		3		1
Preferred stock	13		3		—		—		13		3
Total equity securities available-for-sale	16		4		—		—		16		4
Total	$	7,464	$	342	$	502	$	50	$	7,966	$	392

Activity related to the pretax fixed maturity credit loss component reflected within retained earnings for securities still held for which a portion of an OTTI loss was recognized in OCI

The following table presents the activity related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held as of June 30, 2016 and 2015 for which a portion of an OTTI loss was recognized in Other comprehensive income (loss).

Periods ended June 30	Three Months						Six Months
(In millions)	2016			2015			2016			2015
Beginning balance of credit losses on fixed maturity securities	$	48		$	61		$	53		$	62
Reductions for securities sold during the period	(7		)	(2		)	(12		)	(3		)
Ending balance of credit losses on fixed maturity securities	$	41		$	59		$	41		$	59

Contractual maturity

The following table presents available-for-sale fixed maturity securities by contractual maturity.

	June 30, 2016				December 31, 2015
(In millions)	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,817	$	1,855	$	1,574	$	1,595
Due after one year through five years	8,616		9,114		7,721		8,070
Due after five years through ten years	14,583		15,466		14,652		14,915
Due after ten years	12,812		15,412		13,303		14,989
Total	$	37,828	$	41,847	$	37,250	$	39,569