Investments (Tables)

12 Months Ended

Dec. 31, 2017

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



Years ended December 31
(In millions)	2017			2016			2015
Fixed maturity securities	$	1,812		$	1,819		$	1,751
Equity securities	12			10			12
Limited partnership investments	207			155			92
Mortgage loans	34			41			33
Short term investments	15			8			6
Trading portfolio	12			10			8
Other	1			4			1
Gross investment income	2,093			2,047			1,903
Investment expense	(59		)	(59		)	(63		)
Net investment income	$	2,034		$	1,988		$	1,840

Net realized investment gains (losses)

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



Years ended December 31
(In millions)	2017			2016			2015
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	186		$	204		$	131
Gross realized losses	(64		)	(138		)	(197		)
Net realized investment gains (losses) on fixed maturity securities	122			66			(66		)
Equity securities:
Gross realized gains	1			5			2
Gross realized losses	(1		)	(10		)	(25		)
Net realized investment gains (losses) on equity securities	—			(5		)	(23		)
Derivatives	(4		)	(2		)	10
Short term investments and other	(25		)	(9		)	12
Net realized investment gains (losses)	$	93		$	50		$	(67	)

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)	2017			2016			2015
Net change in unrealized gains on investments:
Fixed maturity securities	$	728		$	225		$	(1,114	)
Equity securities	32			(2		)	(6		)
Other	(2		)	1			1
Total net change in unrealized gains on investments	$	758		$	224		$	(1,119	)

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)	2017		2016		2015
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	12	$	59	$	104
States, municipalities and political subdivisions	—		—		18
Asset-backed:
Residential mortgage-backed	1		10		8
Other asset-backed	—		3		1
Total asset-backed	1		13		9
Total fixed maturity securities available-for-sale	13		72		131
Equity securities available-for-sale	1		9		25
OTTI losses recognized in earnings	$	14	$	81	$	156

Summary of fixed maturity and equity securities

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



December 31, 2017	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	$	17,210	$	1,625	$	28	$	18,807	$	—
States, municipalities and political subdivisions	12,478		1,551		2		14,027		(11		)
Asset-backed:
Residential mortgage-backed	5,043		109		32		5,120		(27		)
Commercial mortgage-backed	1,840		46		14		1,872		—
Other asset-backed	1,083		16		5		1,094		—
Total asset-backed	7,966		171		51		8,086		(27		)
U.S. Treasury and obligations of government-sponsored enterprises	111		2		4		109		—
Foreign government	437		9		2		444		—
Redeemable preferred stock	10		1		—		11		—
Total fixed maturity securities available-for-sale	38,212		3,359		87		41,484		$	(38	)
Total fixed maturity securities trading	3						3
Equity securities available-for-sale:
Common stock	21		7		1		27
Preferred stock	638		31		1		668
Total equity securities available-for-sale	659		38		2		695
Total	$	38,874	$	3,397	$	89	$	42,182



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

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, 2017	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	$	1,354	$	21	$	168	$	7	$	1,522	$	28
States, municipalities and political subdivisions	72		1		85		1		157		2
Asset-backed:
Residential mortgage-backed	1,228		5		947		27		2,175		32
Commercial mortgage-backed	403		4		212		10		615		14
Other asset-backed	248		3		18		2		266		5
Total asset-backed	1,879		12		1,177		39		3,056		51
U.S. Treasury and obligations of government-sponsored enterprises	49		2		21		2		70		4
Foreign government	166		2		4		—		170		2
Total fixed maturity securities available-for-sale	3,520		38		1,455		49		4,975		87
Equity securities available-for-sale:
Common stock	7		1		—		—		7		1
Preferred stock	93		1		—		—		93		1
Total equity securities available-for-sale	100		2		—		—		100		2
Total	$	3,620	$	40	$	1,455	$	49	$	5,075	$	89



	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
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

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, 2017, 2016 and 2015 for which a portion of an OTTI loss was recognized in Other comprehensive income (loss).



Years ended December 31
(In millions)	2017			2016			2015
Beginning balance of credit losses on fixed maturity securities	$	36		$	53		$	62
Reductions for securities sold during the period	(9		)	(16		)	(9		)
Reductions for securities the Company intends to sell or more likely than not will be required to sell	—			(1		)	—
Ending balance of credit losses on fixed maturity securities	$	27		$	36		$	53

Contractual maturity

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



December 31	2017				2016
(In millions)	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,135	$	1,157	$	1,779	$	1,828
Due after one year through five years	8,165		8,501		7,566		7,955
Due after five years through ten years	16,060		16,718		15,892		16,332
Due after ten years	12,852		15,108		13,112		14,778
Total	$	38,212	$	41,484	$	38,349	$	40,893