BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2012

Information with respect to our benefit plans' assets and obligations as of December 31 was as follows:



	Pension Benefits																Other
	Japan								U.S.								Postretirement Benefits
(In millions)	2012				2011				2012				2011				2012					2011
Projected benefit obligation:
Benefit obligation, beginning of year		$	329			$	297			$	525			$	454			$	83				$	67
Service cost		18				17				18				14				6					4
Interest cost		7				12				24				28				4					3
Plan amendments		0				0				0				0				2					0
Actuarial (gain) loss		3				0				60				42				5					10
Benefits and expenses paid		(8		)		(10		)		(14		)		(13		)		(2		)			(1		)
Effect of foreign exchange rate changes		(36		)		13				0				0				0					0
Benefit obligation, end of year		313				329				613				525				98					83

Plan assets:
Fair value of plan assets, beginning of year		171				147				224				209				0					0
Actual return on plan assets		17				(2		)		31				0				0					0
Employer contributions		27				29				20				28				2					1
Benefits and expenses paid		(8		)		(10		)		(14		)		(13		)		(2		)			(1		)
Effect of foreign exchange rate changes		(20		)		7				0				0				0					0
Fair value of plan assets, end of year		187				171				261				224				0					0
Funded status of the plans⁽¹⁾		$	(126	)		$	(158	)		$	(352	)		$	(301	)		$	(98	)			$	(83	)

Amounts recognized in accumulated other comprehensive income:
Net actuarial (gain) loss		$	57			$	77			$	185			$	151			$	34				$	30
Prior service (credit) cost		(3		)		(4		)		0				1				2					0
Transition obligation		1				1				0				0				0					0
Total included in accumulated other comprehensive income		$	55			$	74			$	185			$	152			$	36				$	30
Accumulated benefit obligation		$	276			$	295			$	516			$	448			N/A			⁽²⁾		N/A			⁽²⁾

⁽¹⁾ Recognized in other liabilities in the consolidated balance sheets

⁽²⁾Not applicable

Schedule of Assumptions Used



	Pension Benefits																		Other
	Japan									U.S.									Postretirement Benefits
	2012			2011			2010			2012			2011			2010			2012			2011			2010
Weighted-average actuarial assumptions:
Discount rate - net periodic benefit cost	2.25	%		2.25	%		2.50	%		4.75	%		5.50	%		5.75	%		4.75	%		5.50	%		5.75	%
Discount rate - benefit obligations	2.25			2.25			2.25			4.25			4.75			5.50			4.25			4.75			5.50
Expected long-term return on plan assets	2.50			2.50			2.50			7.50			7.50			7.50			N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾
Rate of compensation increase	N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾	4.00			4.00			4.00			N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾
Health care cost trend rates	N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾	N/A		⁽¹⁾	5.70		⁽²⁾	7.30		⁽²⁾	7.50		⁽²⁾

⁽¹⁾ Not applicable

⁽²⁾For the years 2012, 2011 and 2010, the health care cost trend rates are expected to trend down to 4.7% in 79 years, 4.2% in

75 years, and 3.9% in 75 years, respectively.

Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates

A one-percentage point increase and decrease in assumed health care cost trend rates would have the following effects as of December 31, 2012:



(In millions)
One percentage point increase
Increase in total service and interest costs	$	2
Increase in postretirement benefit obligation	14

One percentage point decrease
Decrease in total service and interest costs	$	2
Decrease in postretirement benefit obligation	12

Schedule of Net Benefit Costs

included in acquisition and operating expenses in the consolidated statements of earnings for the years ended December 31, included the following components:



	Pension Benefits																								Other
		Japan											U.S.												Postretirement Benefits
(In millions)	2012				2011				2010				2012				2011				2010				2012			2011			2010
Service cost		$	18			$	17			$	14			$	18			$	14			$	13			$	6		$	4		$	3
Interest cost		7				12				12				24				28				26				4			3			3
Expected return on plan assets		(4		)		(4		)		(4		)		(16		)		(14		)		(12		)		0			0			0
Amortization of net actuarial loss		3				3				3				11				6				5				1			1			1
Net periodic (benefit) cost		$	24			$	28			$	25			$	37			$	34			$	32			$	11		$	8		$	7

Schedule of Amounts Recognized in Other Comprehensive Income (Loss)

The following table summarizes the amounts recognized in other comprehensive loss (income) for the years ended December 31:



	Pension Benefits																								Other
	Japan												U.S.												Postretirement Benefits
(In millions)	2012				2011				2010				2012				2011				2010				2012				2011				2010
Net actuarial loss (gain)		$	(10	)		$	5			$	11			$	45			$	57			$	13			$	5			$	10			$	8
Amortization of net actuarial loss		(3		)		(3		)		(3		)		(11		)		(6		)		(5		)		(1		)		(1		)		(1		)
Prior service cost (credit)		0				0				0				(1		)		0				0				2				0				0
Total		$	(13	)		$	2			$	8			$	33			$	51			$	8			$	6			$	9			$	7

Schedule of Expected Benefit Payments

The following table provides expected benefit payments, which reflect expected future service, as appropriate.



	Pension Benefits						Other
(In millions)	Japan			U.S.			Postretirement Benefits
2013		$	10		$	19		$	2
2014		8			20			2
2015		9			21			3
2016		10			28			3
2017		10			29			4
2018-2022		68			171			25

Schedule of Allocation of Plan Assets

Asset allocation targets as of December 31, 2012 were as follows:



	Japan Pension			U.S. Pension
Domestic equities		7	%		43	%
International equities		19			22
Fixed income securities		59			35
Other		15			0
Total		100	%		100	%

Plan Assets

Fair Value, Assets Measured on Recurring Basis

The following table presents the fair value of Aflac Japan's pension plan assets that are measured at fair value on a recurring basis as of December 31. All of these assets are classified as Level 2 in the fair value hierarchy.



(In millions)	2012			2011
Japan pension plan assets:
Equities:
Japanese equity securities		$	15		$	11
International equity securities		42			34
Fixed income securities:
Japanese bonds		62			60
International bonds		44			42
Insurance contracts		24			24
Total		$	187		$	171

The following table presents the fair value of Aflac U.S.'s pension plan assets that are measured at fair value on a recurring basis as of December 31. All of these assets are classified as Level 1 in the fair value hierarchy.



(In millions)	2012			2011
U.S. pension plan assets:
Mutual funds:
Large cap equity funds		$	87		$	77
Mid cap equity funds		16			13
Real estate equity funds		8			7
International equity funds		59			45
Fixed income bond funds		88			79
Aflac Incorporated common stock		3			3
Total		$	261		$	224

- Definition

Tabular disclosure of assets, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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