INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2016

Available-for-sale Securities

	December 31, 2015
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair   Value
Securities available for sale, carried at fair value:
Fixed maturities:
Yen-denominated:
Japan government and agencies		$	17,293		$	1,862		$	0		$	19,155
Municipalities		128			9			0			137
Mortgage- and asset-backed securities		322			33			0			355
Public utilities		1,400			210			10			1,600
Sovereign and supranational		791			180			0			971
Banks/financial institutions		2,321			325			105			2,541
Other corporate		3,337			448			33			3,752
Total yen-denominated		25,592			3,067			148			28,511
Dollar-denominated:
U.S. government and agencies		110			11			0			121
Municipalities		926			151			6			1,071
Mortgage- and asset-backed securities		200			27			0			227
Public utilities		5,464			636			221			5,879
Sovereign and supranational		331			105			0			436
Banks/financial institutions		2,865			634			21			3,478
Other corporate		25,154			1,774			1,302			25,626
Total dollar-denominated		35,050			3,338			1,550			36,838
Total fixed maturities		60,642			6,405			1,698			65,349
Perpetual securities:
Yen-denominated:
Banks/financial institutions		1,581			143			93			1,631
Other corporate		183			22			0			205
Dollar-denominated:
Banks/financial institutions		77			35			1			111
Total perpetual securities		1,841			200			94			1,947
Equity securities:
Yen-denominated		472			19			4			487
Dollar-denominated		8			3			0			11
Total equity securities		480			22			4			498
Total securities available for sale		$	62,963		$	6,627		$	1,796		$	67,794

The amortized cost for our investments in debt and perpetual securities, the cost for equity securities and the fair values of these investments are shown in the following tables.

	June 30, 2016
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair   Value
Securities available for sale, carried at fair value:
Fixed maturities:
Yen-denominated:
Japan government and agencies		$	22,176		$	5,828		$	0		$	28,004
Municipalities		200			60			0			260
Mortgage- and asset-backed securities		870			51			0			921
Public utilities		1,639			277			13			1,903
Sovereign and supranational		927			189			0			1,116
Banks/financial institutions		2,704			382			119			2,967
Other corporate		3,926			650			55			4,521
Total yen-denominated		32,442			7,437			187			39,692
Dollar-denominated:
U.S. government and agencies		123			16			0			139
Municipalities		943			164			7			1,100
Mortgage- and asset-backed securities		199			18			0			217
Public utilities		5,724			776			76			6,424
Sovereign and supranational		352			97			0			449
Banks/financial institutions		2,742			533			16			3,259
Other corporate		27,474			2,316			784			29,006
Total dollar-denominated		37,557			3,920			883			40,594
Total fixed maturities		69,999			11,357			1,070			80,286
Perpetual securities:
Yen-denominated:
Banks/financial institutions		1,650			77			199			1,528
Other corporate		214			20			0			234
Dollar-denominated:
Banks/financial institutions		52			18			0			70
Total perpetual securities		1,916			115			199			1,832
Equity securities:
Yen-denominated		694			29			76			647
Dollar-denominated		551			17			18			550
Total equity securities		1,245			46			94			1,197
Total securities available for sale		$	73,160		$	11,518		$	1,363		$	83,315

Held-to-maturity Securities

	June 30, 2016
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair   Value
Securities held to maturity, carried at amortized cost:
Fixed maturities:
Yen-denominated:
Japan government and agencies		$	23,440		$	8,636		$	0		$	32,076
Municipalities		398			167			0			565
Mortgage- and asset-backed securities		39			2			0			41
Public utilities		3,623			415			10			4,028
Sovereign and supranational		2,994			404			7			3,391
Banks/financial institutions		4,659			293			32			4,920
Other corporate		3,193			590			8			3,775
Total yen-denominated		38,346			10,507			57			48,796
Total securities held to maturity		$	38,346		$	10,507		$	57		$	48,796

	December 31, 2015
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
Securities held to maturity, carried at amortized cost:
Fixed maturities:
Yen-denominated:
Japan government and agencies		$	20,004		$	3,387		$	0		$	23,391
Municipalities		341			74			0			415
Mortgage- and asset-backed securities		36			2			0			38
Public utilities		3,092			205			94			3,203
Sovereign and supranational		2,555			182			26			2,711
Banks/financial institutions		4,431			168			53			4,546
Other corporate		3,000			260			44			3,216
Total yen-denominated		33,459			4,278			217			37,520
Total securities held to maturity		$	33,459		$	4,278		$	217		$	37,520

Investments Classified by Contractual Maturity Date

The contractual maturities of our investments in fixed maturities at June 30, 2016, were as follows:

	Aflac Japan						Aflac U.S.
(In millions)	Amortized Cost			Fair Value			Amortized Cost			Fair   Value
Available for sale:
Due in one year or less		$	305		$	312		$	60		$	62
Due after one year through five years		3,882			3,972			722			789
Due after five years through 10 years		11,905			12,101			2,487			2,726
Due after 10 years		40,332			48,573			8,776			10,124
Mortgage- and asset-backed securities		926			988			34			41
Total fixed maturities available for sale		$	57,350		$	65,946		$	12,079		$	13,742
Held to maturity:
Due in one year or less		$	49		$	49		$	0		$	0
Due after one year through five years		1,983			2,087			0			0
Due after five years through 10 years		2,084			2,283			0			0
Due after 10 years		34,191			44,336			0			0
Mortgage- and asset-backed securities		39			41			0			0
Total fixed maturities held to maturity		$	38,346		$	48,796		$	0		$	0

Economic Maturities of Investments in Perpetual Securities

The economic maturities of our investments in perpetual securities, which were all reported as available for sale at June 30, 2016, were as follows:

	Aflac Japan						Aflac U.S.
(In millions)	Amortized Cost			Fair Value			Amortized Cost			Fair   Value
Due in one year or less		$	221		$	195		$	0		$	0
Due after one year through five years		306			316			0			0
Due after 10 years		1,350			1,269			39			52
Total perpetual securities available for sale		$	1,877		$	1,780		$	39		$	52

Investment Exposures Exceeding Ten Percent Shareholders Equity

Investment exposures that individually exceeded 10% of shareholders' equity as of June 30, 2016 and December 31, 2015 were as follows:

	June 30, 2016			December 31, 2015
(In millions)	Credit Rating	Amortized Cost	Fair Value	Credit Rating	Amortized Cost	Fair Value
Japan National Government(1)	A	$45,064	$59,305	A	$36,859	$42,025

⁽¹⁾Japan Government Bonds (JGBs) or JGB-backed securities

Gain (Loss) on Investments

Information regarding pretax realized gains and losses from investments is as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
(In millions)	2016			2015		2016			2015
Realized investment gains (losses):
Fixed maturities:
Available for sale:
Gross gains from sales	$	6		$	55	$	8		$	104
Gross losses from sales	(12		)	0		(16		)	0
Net gains (losses) from redemptions	(5		)	7		78			26
Other-than-temporary impairment losses	(9		)	0		(21		)	(6		)
Total fixed maturities	(20		)	62		49			124
Perpetual securities:
Available for sale:
Net gains (losses) from redemptions	30			30		40			30
Other-than-temporary impairment losses	0			0		(2		)	0
Total perpetual securities	30			30		38			30
Equity securities:
Gross gains from sales	2			0		5			0
Gross losses from sales	(8		)	0		(11		)	0
Other-than-temporary impairment losses	(24		)	0		(24		)	0
Total equity securities	(30		)	0		(30		)	0
Derivatives and other:
Derivative gains (losses)	(167		)	35		(171		)	(14		)
Total derivatives and other	(167		)	35		(171		)	(14		)
Total realized investment gains (losses)	$	(187	)	$	127	$	(114	)	$	140

Other Than Temporary Impairment Losses on Investment Securities

The following table details our pretax other-than-temporary impairment losses by investment category that resulted from our impairment evaluation process.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2016		2015		2016		2015
Perpetual securities	$	0	$	0	$	2	$	0
Corporate bonds	9		0		21		2
Bank/financial institution bonds	0		0		0		4
Equity securities	24		0		24		0
Total other-than-temporary impairment losses realized (1)	$	33	$	0	$	47	$	6

⁽¹⁾ Includes $33 and an immaterial amount for the three-month periods and $47 and $6 for the six-month periods ended June 30, 2016 and 2015, respectively, from change in intent to sell securities or change in intent to hold securities until recovery

Net Effect on Shareholders' Equity of Unrealized Gains and Losses from Investment Securities

The net effect on shareholders’ equity of unrealized gains and losses from investment securities was as follows:

(In millions)	June 30, 2016				December 31, 2015
Unrealized gains (losses) on securities available for sale		$	10,155			$	4,831
Deferred income taxes		(3,714		)		(1,845		)
Shareholders’ equity, unrealized gains (losses) on investment securities		$	6,441			$	2,986

Investments Gross Unrealized Loss Aging

The following tables show the fair values and gross unrealized losses of our available-for-sale and held-to-maturity investments that were in an unrealized loss position, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

	June 30, 2016
	Total						Less than 12 months						12 months or longer
(In millions)	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses
Fixed Maturities:
Municipalities:
Dollar-denominated		$	46		$	7		$	0		$	0		$	46		$	7
Public utilities:
Dollar-denominated		1,216			76			283			12			933			64
Yen-denominated		823			23			182			13			641			10
Sovereign and supranational:
Yen-denominated		236			7			0			0			236			7
Banks/financial institutions:
Dollar-denominated		148			16			78			6			70			10
Yen-denominated		1,428			151			240			3			1,188			148
Other corporate:
Dollar-denominated		8,556			784			3,203			255			5,353			529
Yen-denominated		970			63			327			18			643			45
Total fixed maturities		13,423			1,127			4,313			307			9,110			820
Perpetual securities:
Yen-denominated		989			199			500			42			489			157
Total perpetual securities		989			199			500			42			489			157
Equity securities:
Dollar-denominated		268			18			268			18			0			0
Yen-denominated		411			76			411			76			0			0
Total equity securities		679			94			679			94			0			0
Total		$	15,091		$	1,420		$	5,492		$	443		$	9,599		$	977

	December 31, 2015
	Total						Less than 12 months						12 months or longer
(In millions)	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses
Fixed Maturities:
Municipalities:
Dollar-denominated		$	80		$	6		$	80		$	6		$	0		$	0
Public utilities:
Dollar-denominated		2,127			221			1,689			132			438			89
Yen-denominated		1,487			104			1,062			73			425			31
Sovereign and supranational:
Yen-denominated		580			26			385			13			195			13
Banks/financial institutions:
Dollar-denominated		366			21			348			11			18			10
Yen-denominated		2,350			158			1,147			14			1,203			144
Other corporate:
Dollar-denominated		13,430			1,302			11,068			770			2,362			532
Yen-denominated		1,151			77			343			5			808			72
Total fixed maturities		21,571			1,915			16,122			1,024			5,449			891
Perpetual securities:
Dollar-denominated		6			1			0			0			6			1
Yen-denominated		645			93			216			12			429			81
Total perpetual securities		651			94			216			12			435			82
Equity securities:
Yen-denominated		191			4			191			4			0			0
Total equity securities		191			4			191			4			0			0
Total		$	22,413		$	2,013		$	16,529		$	1,040		$	5,884		$	973

Investments in Unrealized Loss Position

The following table provides more information on our unrealized loss position on fixed maturities, perpetual securities and equity securities.

		June 30, 2016									December 31, 2015
(In millions)	Investments in an Unrealized Loss Position			Gross Unrealized Losses			Gross Unrealized Losses that are Investment Grade			Investments in an Unrealized Loss Position			Gross Unrealized Losses			Gross Unrealized Losses that are Investment Grade
Fixed Maturities:
Public utilities		13	%		7	%		88	%		16	%		16	%		93	%
Sovereign and supranational		2			1			100			3			1			100
Banks/financial institutions		11			12			36			12			9			59
Other corporate		63			59			47			66			69			86
Total fixed maturities		89			79						97			95
Perpetual securities		7			14			100			3			5			100
Equity securities		4			7						0			0
Total		100	%		100	%					100	%		100	%

Securities Lending Transactions Accounted for as Secured Borrowings

Details of our securities lending activities were as follows:

Securities Lending Transactions Accounted for as Secured Borrowings
June 30, 2016
Remaining Contractual Maturity of the Agreements
(In millions)	Overnight and Continuous(1)		Up to 30 days		Total
Securities lending transactions:
Japan government and agencies	$	0	$	372	$	372
Public utilities	104		0		104
Banks/financial institutions	24		0		24
Other corporate	326		0		326
Total borrowings	$	454	$	372	$	826
Gross amount of recognized liabilities for securities lending transactions					$	826
Amounts related to agreements not included in offsetting disclosure in Note 4					$	0

⁽¹⁾ These securities are pledged as collateral under our U.S. securities lending program and can be called at our discretion; therefore, they are classified as Overnight and Continuous.

Securities Lending Transactions Accounted for as Secured Borrowings
December 31, 2015
Remaining Contractual Maturity of the Agreements
(In millions)	Overnight and Continuous(1)		Up to 30 days		Total
Securities lending transactions:
Japan government and agencies	$	0	$	499	$	499
Public utilities	108		0		108
Banks/financial institutions	13		0		13
Other corporate	321		0		321
Total borrowings	$	442	$	499	$	941
Gross amount of recognized liabilities for securities lending transactions					$	941
Amounts related to agreements not included in offsetting disclosure in Note 4					$	0

⁽¹⁾ These securities are pledged as collateral under our U.S. securities lending program and can be called at our discretion; therefore, they are classified as Overnight and Continuous.

Variable Interest Entity, Consolidated

Investments in Variable Interest Entities

VIEs - Consolidated

The following table presents the cost or amortized cost, fair value and balance sheet caption in which the assets and liabilities of consolidated VIEs are reported.

Investments in Consolidated Variable Interest Entities

	June 30, 2016						December 31, 2015
(In millions)	Cost or Amortized Cost			Fair Value			Cost or Amortized Cost			Fair Value
Assets:
Fixed maturities, available for sale		$	4,878		$	5,493		$	3,739		$	4,554
Perpetual securities, available for sale		267			197			255			228
Equity securities		1,018			941			363			363
Other investments		165			169			0			0
Other assets		177			177			102			102
Total assets of consolidated VIEs		$	6,505		$	6,977		$	4,459		$	5,247
Liabilities:
Other liabilities		$	117		$	117		$	293		$	293
Total liabilities of consolidated VIEs		$	117		$	117		$	293		$	293

Variable Interest Entity, Not Consolidated

Investments in Variable Interest Entities

VIEs-Not Consolidated

The table below reflects the amortized cost, fair value and balance sheet caption in which our investment in VIEs not consolidated are reported.

Investments in Variable Interest Entities Not Consolidated

	June 30, 2016						December 31, 2015
(In millions)	Amortized Cost			Fair Value			Amortized Cost			Fair Value
Assets:
Fixed maturities, available for sale		$	5,158		$	5,656		$	4,731		$	5,093
Perpetual securities, available for sale		292			279			249			253
Fixed maturities, held to maturity		2,902			3,336			2,477			2,636
Total investments in VIEs not consolidated		$	8,352		$	9,271		$	7,457		$	7,982

Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2016 related to consolidations.