FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2016

Fair Value Hierarchy, Assets and Liabilities Measured on Recurring Basis

The following tables present the fair value hierarchy levels of the Company's assets and liabilities that are measured and carried at fair value on a recurring basis.



	June 30, 2016
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Assets:
Securities available for sale, carried at fair value:
Fixed maturities:
Government and agencies		$	27,284		$	859		$	0		$	28,143
Municipalities		0			1,360			0			1,360
Mortgage- and asset-backed securities		0			886			252			1,138
Public utilities		0			8,327			0			8,327
Sovereign and supranational		0			1,565			0			1,565
Banks/financial institutions		0			6,200			26			6,226
Other corporate		0			33,527			0			33,527
Total fixed maturities		27,284			52,724			278			80,286
Perpetual securities:
Banks/financial institutions		0			1,598			0			1,598
Other corporate		0			234			0			234
Total perpetual securities		0			1,832			0			1,832
Equity securities		1,188			6			3			1,197
Other assets:
Foreign currency swaps		0			316			176			492
Foreign currency forwards		0			1,459			0			1,459
Foreign currency options		0			11			0			11
Credit default swaps		0			0			1			1
Total other assets		0			1,786			177			1,963
Other investments		207			0			0			207
Cash and cash equivalents		3,700			0			0			3,700
Total assets		$	32,379		$	56,348		$	458		$	89,185
Liabilities:
Foreign currency swaps		$	0		$	279		$	117		$	396
Foreign currency forwards		0			93			0			93
Foreign currency options		0			53			0			53
Total liabilities		$	0		$	425		$	117		$	542



	December 31, 2015
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Assets:
Securities available for sale, carried at fair value:
Fixed maturities:
Government and agencies		$	18,669		$	607		$	0		$	19,276
Municipalities		0			1,208			0			1,208
Mortgage- and asset-backed securities		0			362			220			582
Public utilities		0			7,479			0			7,479
Sovereign and supranational		0			1,407			0			1,407
Banks/financial institutions		0			5,993			26			6,019
Other corporate		0			29,378			0			29,378
Total fixed maturities		18,669			46,434			246			65,349
Perpetual securities:
Banks/financial institutions		0			1,742			0			1,742
Other corporate		0			205			0			205
Total perpetual securities		0			1,947			0			1,947
Equity securities		489			6			3			498
Other assets:
Foreign currency swaps		0			462			101			563
Foreign currency forwards		0			107			0			107
Foreign currency options		0			5			0			5
Credit default swaps		0			0			1			1
Total other assets		0			574			102			676
Other investments		176			0			0			176
Cash and cash equivalents		4,350			0			0			4,350
Total assets		$	23,684		$	48,961		$	351		$	72,996
Liabilities:
Foreign currency swaps		$	0		$	21		$	293		$	314
Foreign currency forwards		0			49			0			49
Foreign currency options		0			8			0			8
Total liabilities		$	0		$	78		$	293		$	371

Fair Value Hierarchy Levels of Assets and Liabilities Carried at Cost or Amortized Cost

The following tables present the carrying amount and fair value categorized by fair value hierarchy level for the Company's financial instruments that are not carried at fair value.



	June 30, 2016
(In millions)	Carrying Value			Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Assets:
Securities held to maturity, carried at amortized cost:
Fixed maturities:
Government and agencies		$	23,440		$	32,076		$	0		$	0		$	32,076
Municipalities		398			0			565			0			565
Mortgage and asset-backed securities		39			0			13			28			41
Public utilities		3,623			0			4,028			0			4,028
Sovereign and supranational		2,994			0			3,391			0			3,391
Banks/financial institutions		4,659			0			4,920			0			4,920
Other corporate		3,193			0			3,775			0			3,775
Other investments		415			0			0			421			421
Total assets		$	38,761		$	32,076		$	16,692		$	449		$	49,217
Liabilities:
Other policyholders’ funds		$	7,468		$	0		$	0		$	7,327		$	7,327
Notes payable (excluding capital leases)		4,987			0			0			5,522			5,522
Total liabilities		$	12,455		$	0		$	0		$	12,849		$	12,849



	December 31, 2015
(In millions)	Carrying Value			Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Assets:
Securities held to maturity, carried at amortized cost:
Fixed maturities:
Government and agencies		$	20,004		$	23,391		$	0		$	0		$	23,391
Municipalities		341			0			415			0			415
Mortgage and asset-backed securities		36			0			12			26			38
Public utilities		3,092			0			3,203			0			3,203
Sovereign and supranational		2,555			0			2,711			0			2,711
Banks/financial institutions		4,431			0			4,546			0			4,546
Other corporate		3,000			0			3,216			0			3,216
Other investments		118			0			0			118			118
Total assets		$	33,577		$	23,391		$	14,103		$	144		$	37,638
Liabilities:
Other policyholders’ funds		$	6,285		$	0		$	0		$	6,160		$	6,160
Notes payable (excluding capital leases)		4,991			0			0			5,285			5,285
Total liabilities		$	11,276		$	0		$	0		$	11,445		$	11,445

Fair Value Assets Available-for-Sale Securities Primary Pricing Sources

The following tables present the pricing sources for the fair values of our fixed maturities, perpetual securities, and equity securities.



	June 30, 2016
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Securities available for sale, carried at fair value:
Fixed maturities:
Government and agencies:
Third party pricing vendor		$	27,284		$	859		$	0		$	28,143
Total government and agencies		27,284			859			0			28,143
Municipalities:
Third party pricing vendor		0			1,360			0			1,360
Total municipalities		0			1,360			0			1,360
Mortgage- and asset-backed securities:
Third party pricing vendor		0			886			0			886
Broker/other		0			0			252			252
Total mortgage- and asset-backed securities		0			886			252			1,138
Public utilities:
Third party pricing vendor		0			8,327			0			8,327
Total public utilities		0			8,327			0			8,327
Sovereign and supranational:
Third party pricing vendor		0			1,565			0			1,565
Total sovereign and supranational		0			1,565			0			1,565
Banks/financial institutions:
Third party pricing vendor		0			6,200			0			6,200
Broker/other		0			0			26			26
Total banks/financial institutions		0			6,200			26			6,226
Other corporate:
Third party pricing vendor		0			33,527			0			33,527
Total other corporate		0			33,527			0			33,527
Total fixed maturities		27,284			52,724			278			80,286
Perpetual securities:
Banks/financial institutions:
Third party pricing vendor		0			1,598			0			1,598
Total banks/financial institutions		0			1,598			0			1,598
Other corporate:
Third party pricing vendor		0			234			0			234
Total other corporate		0			234			0			234
Total perpetual securities		0			1,832			0			1,832
Equity securities:
Third party pricing vendor		1,188			6			0			1,194
Broker/other		0			0			3			3
Total equity securities		1,188			6			3			1,197
Total securities available for sale		$	28,472		$	54,562		$	281		$	83,315



	December 31, 2015
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Securities available for sale, carried at fair value:
Fixed maturities:
Government and agencies:
Third party pricing vendor		$	18,669		$	607		$	0		$	19,276
Total government and agencies		18,669			607			0			19,276
Municipalities:
Third party pricing vendor		0			1,208			0			1,208
Total municipalities		0			1,208			0			1,208
Mortgage- and asset-backed securities:
Third party pricing vendor		0			362			0			362
Broker/other		0			0			220			220
Total mortgage- and asset-backed securities		0			362			220			582
Public utilities:
Third party pricing vendor		0			7,479			0			7,479
Total public utilities		0			7,479			0			7,479
Sovereign and supranational:
Third party pricing vendor		0			1,407			0			1,407
Total sovereign and supranational		0			1,407			0			1,407
Banks/financial institutions:
Third party pricing vendor		0			5,993			0			5,993
Broker/other		0			0			26			26
Total banks/financial institutions		0			5,993			26			6,019
Other corporate:
Third party pricing vendor		0			29,378			0			29,378
Total other corporate		0			29,378			0			29,378
Total fixed maturities		18,669			46,434			246			65,349
Perpetual securities:
Banks/financial institutions:
Third party pricing vendor		0			1,742			0			1,742
Total banks/financial institutions		0			1,742			0			1,742
Other corporate:
Third party pricing vendor		0			205			0			205
Total other corporate		0			205			0			205
Total perpetual securities		0			1,947			0			1,947
Equity securities:
Third party pricing vendor		489			6			0			495
Broker/other		0			0			3			3
Total equity securities		489			6			3			498
Total securities available for sale		$	19,158		$	48,387		$	249		$	67,794

Fair Value Assets Held-To-Maturity Securities Primary Pricing Sources



	December 31, 2015
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Securities held to maturity, carried at amortized cost:
Fixed maturities:
Government and agencies:
Third party pricing vendor		$	23,391		$	0		$	0		$	23,391
Total government and agencies		23,391			0			0			23,391
Municipalities:
Third party pricing vendor		0			415			0			415
Total municipalities		0			415			0			415
Mortgage- and asset-backed securities:
Third party pricing vendor		0			12			0			12
Broker/other		0			0			26			26
Total mortgage- and asset-backed securities		0			12			26			38
Public utilities:
Third party pricing vendor		0			3,203			0			3,203
Total public utilities		0			3,203			0			3,203
Sovereign and supranational:
Third party pricing vendor		0			2,711			0			2,711
Total sovereign and supranational		0			2,711			0			2,711
Banks/financial institutions:
Third party pricing vendor		0			4,546			0			4,546
Total banks/financial institutions		0			4,546			0			4,546
Other corporate:
Third party pricing vendor		0			3,189			0			3,189
Broker/other		0			27			0			27
Total other corporate		0			3,216			0			3,216
Total securities held to maturity		$	23,391		$	14,103		$	26		$	37,520



	June 30, 2016
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Securities held to maturity, carried at amortized cost:
Fixed maturities:
Government and agencies:
Third party pricing vendor		$	32,076		$	0		$	0		$	32,076
Total government and agencies		32,076			0			0			32,076
Municipalities:
Third party pricing vendor		0			565			0			565
Total municipalities		0			565			0			565
Mortgage- and asset-backed securities:
Third party pricing vendor		0			13			0			13
Broker/other		0			0			28			28
Total mortgage- and asset-backed securities		0			13			28			41
Public utilities:
Third party pricing vendor		0			4,028			0			4,028
Total public utilities		0			4,028			0			4,028
Sovereign and supranational:
Third party pricing vendor		0			3,391			0			3,391
Total sovereign and supranational		0			3,391			0			3,391
Banks/financial institutions:
Third party pricing vendor		0			4,823			0			4,823
Broker/other		0			97			0			97
Total banks/financial institutions		0			4,920			0			4,920
Other corporate:
Third party pricing vendor		0			3,775			0			3,775
Total other corporate		0			3,775			0			3,775
Total securities held to maturity		$	32,076		$	16,692		$	28		$	48,796

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

Transfers between Hierarchy Levels and Level 3 Rollforward

There were no transfers between Level 1 and 2 for the three- and six-month periods ended June 30, 2016 and 2015, respectively.

The following tables present the changes in fair value of our available-for-sale investments and derivatives classified as Level 3.



Three Months Ended June 30, 2016
	Fixed Maturities					Perpetual Securities		Equity Securities		Derivatives ⁽¹⁾
(In millions)	Mortgage- and Asset- Backed Securities			Banks/ Financial Institutions		Banks/ Financial Institutions				Foreign Currency Swaps			Credit Default Swaps			Total
Balance, beginning of period	$	237		$	26	$	0	$	3	$	(63	)	$	2		$	205
Realized investment gains (losses) included in earnings	0			0		0		0		123			(1		)	122
Unrealized gains (losses) included in other comprehensive income (loss)	26			0		0		0		(1		)	0			25
Purchases, issuances, sales and settlements:
Purchases	0			0		0		0		0			0			0
Issuances	0			0		0		0		0			0			0
Sales	0			0		0		0		0			0			0
Settlements	(11		)	0		0		0		0			0			(11		)
Transfers into Level 3	0			0		0		0		0			0			0
Transfers out of Level 3	0			0		0		0		0			0			0
Balance, end of period	$	252		$	26	$	0	$	3	$	59		$	1		$	341
Changes in unrealized gains (losses) relating to Level 3 assets and liabilities still held at the end of the period included in realized investment gains (losses)	$	0		$	0	$	0	$	0	$	123		$	(1	)	$	122

⁽¹⁾ Derivative assets and liabilities are presented net



Three Months Ended June 30, 2015
	Fixed Maturities						Perpetual Securities			Equity Securities		Derivatives ⁽¹⁾
(In millions)	Mortgage- and Asset- Backed Securities			Banks/ Financial Institutions			Banks/ Financial Institutions					Foreign Currency Swaps			Credit Default Swaps		Total
Balance, beginning of period	$	221		$	26		$	150		$	3	$	(283	)	$	1	$	118
Realized investment gains (losses) included in earnings	0			0			0			0		58			0		58
Unrealized gains (losses) included in other comprehensive income (loss)	(6		)	(1		)	(3		)	0		2			0		(8		)
Purchases, issuances, sales and settlements:
Purchases	0			0			0			0		0			0		0
Issuances	0			0			0			0		0			0		0
Sales	0			0			(147		)	0		0			0		(147		)
Settlements	(1		)	0			0			0		0			0		(1		)
Transfers into Level 3	0			0			0			0		0			0		0
Transfers out of Level 3	0			0			0			0		0			0		0
Balance, end of period	$	214		$	25		$	0		$	3	$	(223	)	$	1	$	20
Changes in unrealized gains (losses) relating to Level 3 assets and liabilities still held at the end of the period included in realized investment gains (losses)	$	0		$	0		$	0		$	0	$	58		$	0	$	58

⁽¹⁾ Derivative assets and liabilities are presented net



Six Months Ended June 30, 2016
	Fixed Maturities					Perpetual Securities		Equity Securities		Derivatives ⁽¹⁾
(In millions)	Mortgage- and Asset- Backed Securities			Banks/ Financial Institutions		Banks/ Financial Institutions				Foreign Currency Swaps			Credit Default Swaps		Total
Balance, beginning of period	$	220		$	26	$	0	$	3	$	(192	)	$	1	$	58
Realized investment gains (losses) included in earnings	0			0		0		0		268			0		268
Unrealized gains (losses) included in other comprehensive income (loss)	47			0		0		0		(16		)	0		31
Purchases, issuances, sales and settlements:
Purchases	0			0		0		0		0			0		0
Issuances	0			0		0		0		0			0		0
Sales	0			0		0		0		0			0		0
Settlements	(15		)	0		0		0		(1		)	0		(16		)
Transfers into Level 3	0			0		0		0		0			0		0
Transfers out of Level 3	0			0		0		0		0			0		0
Balance, end of period	$	252		$	26	$	0	$	3	$	59		$	1	$	341
Changes in unrealized gains (losses) relating to Level 3 assets and liabilities still held at the end of the period included in realized investment gains (losses)	$	0		$	0	$	0	$	0	$	268		$	0	$	268

⁽¹⁾ Derivative assets and liabilities are presented net



Six Months Ended June 30, 2015
	Fixed Maturities						Perpetual Securities			Equity Securities		Derivatives ⁽¹⁾
(In millions)	Mortgage- and Asset- Backed Securities			Banks/ Financial Institutions			Banks/ Financial Institutions					Foreign Currency Swaps			Credit Default Swaps		Total
Balance, beginning of period	$	223		$	26		$	149		$	3	$	(212	)	$	0	$	189
Realized investment gains (losses) included in earnings	0			0			0			0		(25		)	1		(24		)
Unrealized gains (losses) included in other comprehensive income (loss)	(7		)	(1		)	(2		)	0		(2		)	0		(12		)
Purchases, issuances, sales and settlements:
Purchases	0			0			0			0		0			0		0
Issuances	0			0			0			0		0			0		0
Sales	0			0			(147		)	0		0			0		(147		)
Settlements	(2		)	0			0			0		16			0		14
Transfers into Level 3	0			0			0			0		0			0		0
Transfers out of Level 3	0			0			0			0		0			0		0
Balance, end of period	$	214		$	25		$	0		$	3	$	(223	)	$	1	$	20
Changes in unrealized gains (losses) relating to Level 3 assets and liabilities still held at the end of the period included in realized investment gains (losses)	$	0		$	0		$	0		$	0	$	(25	)	$	1	$	(24	)

⁽¹⁾ Derivative assets and liabilities are presented net

Fair Value Inputs Assets Quantitative Information

December 31, 2015

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Assets:

Securities available for sale, carried at fair value:

Fixed maturities:

Mortgage- and asset-backed securities

220

Consensus pricing

Offered quotes

N/A

^(d)

Banks/financial institutions

Consensus pricing

Offered quotes

N/A

^(d)

Equity securities

Net asset value

Offered quotes

$1-$677 ($7)

Other assets:

Foreign currency swaps

Discounted cash flow

Interest rates (USD)

2.20% - 2.62%

^(a)

Interest rates (JPY)

.42% - 1.22%

^(b)

CDS spreads

32 - 147 bps

Foreign exchange rates

20.05%

^(c)

Discounted cash flow

Interest rates (USD)

2.20% - 2.62%

^(a)

Interest rates (JPY)

.42% - 1.22%

^(b)

Foreign exchange rates

20.05%

^(c)

Credit default swaps

Discounted cash flow

Base correlation

53.26% - 58.40%

^(e)

CDS spreads

123 bps

Recovery rate

36.87%

Total assets

351

(a) Inputs derived from U.S. long-term rates to accommodate long maturity nature of our swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of our swaps

(d) N/A represents securities where we receive unadjusted broker quotes and for which there is no transparency into the providers' valuation techniques or unobservable inputs.

(e) Range of base correlation for our bespoke tranche for attachment and detachment points corresponding to market indices

The following tables summarize the significant unobservable inputs used in the valuation of our Level 3 available-for-sale investments and derivatives. Included in the tables are the inputs or range of possible inputs that have an effect on the overall valuation of the financial instruments.

June 30, 2016

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Assets:

Securities available for sale, carried at fair value:

Fixed maturities:

Mortgage- and asset-backed securities

252

Consensus pricing

Offered quotes

N/A

^(d)

Banks/financial institutions

Consensus pricing

Offered quotes

N/A

^(d)

Equity securities

Net asset value

Offered quotes

$1 - $793 ($9)

Other assets:

Foreign currency swaps

Discounted cash flow

Interest rates (USD)

1.36% - 1.83%

^(a)

Interest rates (JPY)

(.04%) - .17%

^(b)

CDS spreads

20 - 163 bps

Foreign exchange rates

21.14%

^(c)

Discounted cash flow

Interest rates (USD)

1.64% - 2.14%

^(a)

Interest rates (JPY)

.15% - .60%

^(b)

CDS spreads

19 - 106 bps

Discounted cash flow

Interest rates (USD)

1.64% - 2.14%

^(a)

Interest rates (JPY)

.15% - .60%

^(b)

Foreign exchange rates

21.14%

^(c)

Credit default swaps

Discounted cash flow

Base correlation

64.18% - 69.87%

^(e)

CDS spreads

84 bps

Recovery rate

36.93%

Total assets

458

(a) Inputs derived from U.S. long-term rates to accommodate long maturity nature of our swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of our swaps

(d) N/A represents securities where we receive unadjusted broker quotes and for which there is no transparency into the providers' valuation techniques or unobservable inputs.

(e) Range of base correlation for our bespoke tranche for attachment and detachment points corresponding to market indices.

Fair Value Inputs Liabilities Quantitative Information

December 31, 2015

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Liabilities:

Foreign currency swaps

158

Discounted cash flow

Interest rates (USD)

2.20% - 2.62%

^(a)

Interest rates (JPY)

.42% - 1.22%

^(b)

CDS spreads

32 - 147 bps

Foreign exchange rates

20.05%

^(c)

120

Discounted cash flow

Interest rates (USD)

2.20% - 2.62%

^(a)

Interest rates (JPY)

.42% - 1.22%

^(b)

CDS spreads

35 - 213 bps

Discounted cash flow

Interest rates (USD)

2.20% - 2.62%

^(a)

Interest rates (JPY)

.42% - 1.22%

^(b)

Foreign exchange rates

20.05%

^(c)

Total liabilities

293

(a) Inputs derived from U.S. long-term rates to accommodate long maturity nature of our swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of our swaps

June 30, 2016

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Liabilities:

Foreign currency swaps

Discounted cash flow

Interest rates (USD)

1.64% - 2.14%

^(a)

Interest rates (JPY)

.15% - .60%

^(b)

CDS spreads

32 - 147 bps

Foreign exchange rates

21.14%

^(c)

Discounted cash flow

Interest rates (USD)

1.64% - 2.14%

^(a)

Interest rates (JPY)

.15% - .60%

^(b)

CDS spreads

49 - 329 bps

Discounted cash flow

Interest rates (USD)

1.64% - 2.14%

^(a)

Interest rates (JPY)

.15% - .60%

^(b)

Foreign exchange rates

21.14%

^(c)

Total liabilities

117

(a) Inputs derived from U.S. long-term rates to accommodate long maturity nature of our swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of our swaps