Investments (Tables)

12 Months Ended

Dec. 31, 2016

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



Years ended December 31
(In millions)	2016			2015			2014
Fixed maturity securities	$	1,819		$	1,751		$	1,803
Equity securities	10			12			12
Limited partnership investments	155			92			263
Mortgage loans	41			33			31
Short term investments	8			6			3
Trading portfolio	10			8			10
Other	4			1			3
Gross investment income	2,047			1,903			2,125
Investment expense	(59		)	(63		)	(58		)
Net investment income	$	1,988		$	1,840		$	2,067

Net realized investment gains (losses)

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



Years ended December 31
(In millions)	2016			2015			2014
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	204		$	131		$	170
Gross realized losses	(138		)	(197		)	(129		)
Net realized investment gains (losses) on fixed maturity securities	66			(66		)	41
Equity securities:
Gross realized gains	5			2			8
Gross realized losses	(10		)	(25		)	(7		)
Net realized investment gains (losses) on equity securities	(5		)	(23		)	1
Derivatives	(2		)	10			(1		)
Short term investments and other	(9		)	12			16
Net realized investment gains (losses)	$	50		$	(67	)	$	57

Net change in unrealized gains (losses) on investments

Net change in unrealized gains on investments is presented in the following table.



Years ended December 31
(In millions)	2016			2015			2014
Net change in unrealized gains on investments:
Fixed maturity securities	$	225		$	(1,114	)	$	1,511
Equity securities	(2		)	(6		)	6
Other	1			1			—
Total net change in unrealized gains on investments	$	224		$	(1,119	)	$	1,517

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

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



Years ended December 31
(In millions)	2016		2015		2014
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	59	$	104	$	18
States, municipalities and political subdivisions	—		18		46
Asset-backed:
Residential mortgage-backed	10		8		5
Other asset-backed	3		1		1
Total asset-backed	13		9		6
Total fixed maturity securities available-for-sale	72		131		70
Equity securities available-for-sale -- Common stock	9		25		7
OTTI losses recognized in earnings	$	81	$	156	$	77

Summary of fixed maturity and equity securities

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



December 31, 2016	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	$	17,711	$	1,323	$	76	$	18,958	$	(1	)
States, municipalities and political subdivisions	12,060		1,213		33		13,240		(16		)
Asset-backed:
Residential mortgage-backed	5,004		120		51		5,073		(28		)
Commercial mortgage-backed	2,016		48		24		2,040		—
Other asset-backed	1,022		8		5		1,025		—
Total asset-backed	8,042		176		80		8,138		(28		)
U.S. Treasury and obligations of government-sponsored enterprises	83		10		—		93		—
Foreign government	435		13		3		445		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,349		2,736		192		40,893		$	(45	)
Total fixed maturity securities trading	12						12
Equity securities available-for-sale:
Common stock	13		6		—		19
Preferred stock	93		2		4		91
Total equity securities available-for-sale	106		8		4		110
Total	$	38,467	$	2,744	$	196	$	41,015



December 31, 2015	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	$	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
December 31, 2016	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	$	2,615	$	61	$	254	$	15	$	2,869	$	76
States, municipalities and political subdivisions	959		32		23		1		982		33
Asset-backed:
Residential mortgage-backed	2,136		44		201		7		2,337		51
Commercial mortgage-backed	756		22		69		2		825		24
Other asset-backed	398		5		24		—		422		5
Total asset-backed	3,290		71		294		9		3,584		80
U.S. Treasury and obligations of government-sponsored enterprises	5		—		—		—		5		—
Foreign government	108		3		—		—		108		3
Redeemable preferred stock	—		—		—		—		—		—
Total fixed maturity securities available-for-sale	6,977		167		571		25		7,548		192
Equity securities available-for-sale -- Preferred stock	12		—		13		4		25		4
Total	$	6,989	$	167	$	584	$	29	$	7,573	$	196



	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)	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	$	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

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 December 31, 2016, 2015 and 2014 for which a portion of an OTTI loss was recognized in Other comprehensive income (loss).



Years ended December 31
(In millions)	2016			2015			2014
Beginning balance of credit losses on fixed maturity securities	$	53		$	62		$	74
Reductions for securities sold during the period	(16		)	(9		)	(9		)
Reductions for securities the Company intends to sell or more likely than not will be required to sell	(1		)	—			(3		)
Ending balance of credit losses on fixed maturity securities	$	36		$	53		$	62

Contractual maturity

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



December 31	2016				2015
(In millions)	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,779	$	1,828	$	1,574	$	1,595
Due after one year through five years	7,566		7,955		7,721		8,070
Due after five years through ten years	15,892		16,332		14,652		14,915
Due after ten years	13,112		14,778		13,303		14,989
Total	$	38,349	$	40,893	$	37,250	$	39,569