FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2017

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, 2017
(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		$	29,129		$	900		$	0		$	30,029
Municipalities		0			1,344			0			1,344
Mortgage- and asset-backed securities		0			292			188			480
Public utilities		0			7,951			53			8,004
Sovereign and supranational		0			2,074			0			2,074
Banks/financial institutions		0			6,771			25			6,796
Other corporate		0			30,953			77			31,030
Total fixed maturities		29,129			50,285			343			79,757
Perpetual securities:
Banks/financial institutions		0			1,615			0			1,615
Other corporate		0			228			0			228
Total perpetual securities		0			1,843			0			1,843
Equity securities		1,383			6			14			1,403
Other assets:
Foreign currency swaps		0			167			140			307
Foreign currency forwards		0			214			0			214
Foreign currency options		0			20			0			20
Credit default swaps		0			0			2			2
Total other assets		0			401			142			543
Other investments		138			0			0			138
Cash and cash equivalents		4,264			0			0			4,264
Total assets		$	34,914		$	52,535		$	499		$	87,948
Liabilities:
Other liabilities:
Foreign currency swaps		$	0		$	66		$	133		$	199
Foreign currency forwards		0			906			0			906
Foreign currency options		0			16			0			16
Total liabilities		$	0		$	988		$	133		$	1,121



	December 31, 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		$	25,387		$	827		$	0		$	26,214
Municipalities		0			1,295			0			1,295
Mortgage- and asset-backed securities		0			1,139			198			1,337
Public utilities		0			7,667			16			7,683
Sovereign and supranational		0			1,469			0			1,469
Banks/financial institutions		0			6,038			25			6,063
Other corporate		0			29,699			0			29,699
Total fixed maturities		25,387			48,134			239			73,760
Perpetual securities:
Banks/financial institutions		0			1,420			0			1,420
Other corporate		0			213			0			213
Total perpetual securities		0			1,633			0			1,633
Equity securities		1,300			6			3			1,309
Other assets:
Foreign currency swaps		0			365			125			490
Foreign currency forwards		0			672			0			672
Foreign currency options		0			43			0			43
Credit default swaps		0			0			2			2
Total other assets		0			1,080			127			1,207
Other investments		276			0			0			276
Cash and cash equivalents		4,859			0			0			4,859
Total assets		$	31,822		$	50,853		$	369		$	83,044
Liabilities:
Other liabilities:
Foreign currency swaps		$	0		$	84		$	146		$	230
Foreign currency forwards		0			1,717			0			1,717
Foreign currency options		0			51			0			51
Total liabilities		$	0		$	1,852		$	146		$	1,998

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, 2017
(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		$	21,527		$	26,653		$	0		$	0		$	26,653
Municipalities		362			0			467			0			467
Mortgage and asset-backed securities		29			0			9			21			30
Public utilities		3,329			0			3,779			0			3,779
Sovereign and supranational		1,537			0			1,841			0			1,841
Banks/financial institutions		3,119			0			3,322			0			3,322
Other corporate		2,710			0			3,215			0			3,215
Other investments ⁽¹⁾		1,630			0			0			1,616			1,616
Total assets		$	34,243		$	26,653		$	12,633		$	1,637		$	40,923
Liabilities:
Other policyholders’ funds		$	6,978		$	0		$	0		$	6,859		$	6,859
Notes payable (excluding capital leases)		5,234			507			4,783			267			5,557
Total liabilities		$	12,212		$	507		$	4,783		$	7,126		$	12,416

⁽¹⁾ Excludes policy loans of $201 and equity method investments of $47, at carrying value



	December 31, 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		$	20,702		$	26,040		$	0		$	0		$	26,040
Municipalities		350			0			457			0			457
Mortgage and asset-backed securities		30			0			10			22			32
Public utilities		3,201			0			3,536			0			3,536
Sovereign and supranational		2,602			0			2,877			0			2,877
Banks/financial institutions		3,731			0			3,900			0			3,900
Other corporate		2,734			0			3,179			0			3,179
Other investments		1,174			0			0			1,142			1,142
Total assets		$	34,524		$	26,040		$	13,959		$	1,164		$	41,163
Liabilities:
Other policyholders’ funds		$	6,659		$	0		$	0		$	6,540		$	6,540
Notes payable (excluding capital leases)		5,339			0			0			5,530			5,530
Total liabilities		$	11,998		$	0		$	0		$	12,070		$	12,070

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, 2017
(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		$	29,129		$	900		$	0		$	30,029
Total government and agencies		29,129			900			0			30,029
Municipalities:
Third party pricing vendor		0			1,344			0			1,344
Total municipalities		0			1,344			0			1,344
Mortgage- and asset-backed securities:
Third party pricing vendor		0			292			0			292
Broker/other		0			0			188			188
Total mortgage- and asset-backed securities		0			292			188			480
Public utilities:
Third party pricing vendor		0			7,951			0			7,951
Broker/other		0			0			53			53
Total public utilities		0			7,951			53			8,004
Sovereign and supranational:
Third party pricing vendor		0			2,074			0			2,074
Total sovereign and supranational		0			2,074			0			2,074
Banks/financial institutions:
Third party pricing vendor		0			6,771			0			6,771
Broker/other		0			0			25			25
Total banks/financial institutions		0			6,771			25			6,796
Other corporate:
Third party pricing vendor		0			30,953			0			30,953
Broker/other		0			0			77			77
Total other corporate		0			30,953			77			31,030
Total fixed maturities		29,129			50,285			343			79,757
Perpetual securities:
Banks/financial institutions:
Third party pricing vendor		0			1,615			0			1,615
Total banks/financial institutions		0			1,615			0			1,615
Other corporate:
Third party pricing vendor		0			228			0			228
Total other corporate		0			228			0			228
Total perpetual securities		0			1,843			0			1,843
Equity securities:
Third party pricing vendor		1,383			6			0			1,389
Broker/other		0			0			14			14
Total equity securities		1,383			6			14			1,403
Total securities available for sale		$	30,512		$	52,134		$	357		$	83,003



	December 31, 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		$	25,387		$	827		$	0		$	26,214
Total government and agencies		25,387			827			0			26,214
Municipalities:
Third party pricing vendor		0			1,295			0			1,295
Total municipalities		0			1,295			0			1,295
Mortgage- and asset-backed securities:
Third party pricing vendor		0			1,139			0			1,139
Broker/other		0			0			198			198
Total mortgage- and asset-backed securities		0			1,139			198			1,337
Public utilities:
Third party pricing vendor		0			7,667			0			7,667
Broker/other		0			0			16			16
Total public utilities		0			7,667			16			7,683
Sovereign and supranational:
Third party pricing vendor		0			1,469			0			1,469
Total sovereign and supranational		0			1,469			0			1,469
Banks/financial institutions:
Third party pricing vendor		0			6,038			0			6,038
Broker/other		0			0			25			25
Total banks/financial institutions		0			6,038			25			6,063
Other corporate:
Third party pricing vendor		0			29,699			0			29,699
Total other corporate		0			29,699			0			29,699
Total fixed maturities		25,387			48,134			239			73,760
Perpetual securities:
Banks/financial institutions:
Third party pricing vendor		0			1,420			0			1,420
Total banks/financial institutions		0			1,420			0			1,420
Other corporate:
Third party pricing vendor		0			213			0			213
Total other corporate		0			213			0			213
Total perpetual securities		0			1,633			0			1,633
Equity securities:
Third party pricing vendor		1,300			6			0			1,306
Broker/other		0			0			3			3
Total equity securities		1,300			6			3			1,309
Total securities available for sale		$	26,687		$	49,773		$	242		$	76,702

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



	June 30, 2017
(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		$	26,653		$	0		$	0		$	26,653
Total government and agencies		26,653			0			0			26,653
Municipalities:
Third party pricing vendor		0			467			0			467
Total municipalities		0			467			0			467
Mortgage- and asset-backed securities:
Third party pricing vendor		0			9			0			9
Broker/other		0			0			21			21
Total mortgage- and asset-backed securities		0			9			21			30
Public utilities:
Third party pricing vendor		0			3,779			0			3,779
Total public utilities		0			3,779			0			3,779
Sovereign and supranational:
Third party pricing vendor		0			1,841			0			1,841
Total sovereign and supranational		0			1,841			0			1,841
Banks/financial institutions:
Third party pricing vendor		0			3,322			0			3,322
Total banks/financial institutions		0			3,322			0			3,322
Other corporate:
Third party pricing vendor		0			3,215			0			3,215
Total other corporate		0			3,215			0			3,215
Total securities held to maturity		$	26,653		$	12,633		$	21		$	39,307



	December 31, 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		$	26,040		$	0		$	0		$	26,040
Total government and agencies		26,040			0			0			26,040
Municipalities:
Third party pricing vendor		0			457			0			457
Total municipalities		0			457			0			457
Mortgage- and asset-backed securities:
Third party pricing vendor		0			10			0			10
Broker/other		0			0			22			22
Total mortgage- and asset-backed securities		0			10			22			32
Public utilities:
Third party pricing vendor		0			3,536			0			3,536
Total public utilities		0			3,536			0			3,536
Sovereign and supranational:
Third party pricing vendor		0			2,877			0			2,877
Total sovereign and supranational		0			2,877			0			2,877
Banks/financial institutions:
Third party pricing vendor		0			3,900			0			3,900
Total banks/financial institutions		0			3,900			0			3,900
Other corporate:
Third party pricing vendor		0			3,179			0			3,179
Total other corporate		0			3,179			0			3,179
Total securities held to maturity		$	26,040		$	13,959		$	22		$	40,021

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

Transfers between Hierarchy Levels and Level 3 Rollforward

During the three- and six-month periods ended June 30, 2017 and 2016, respectively, there were no transfers between Level 1 and 2 for assets and liabilities that are measured and carried at fair value on a recurring basis.

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, 2017
	Fixed Maturities									Equity Securities		Derivatives ⁽¹⁾
(In millions)	Mortgage- and Asset- Backed Securities			Public Utilities		Banks/ Financial Institutions		Other Corporate				Foreign Currency Swaps			Credit Default Swaps		Total
Balance, beginning of period	$	195		$	16	$	24	$	35	$	4	$	19		$	2	$	295
Realized investment gains (losses) included in earnings	0			0		0		0		0		(10		)	0		(10		)
Unrealized gains (losses) included in other comprehensive income (loss)	0			0		1		2		0		(2		)	0		1
Purchases, issuances, sales and settlements:
Purchases	0			37		0		40		10		0			0		87
Issuances	0			0		0		0		0		0			0		0
Sales	0			0		0		0		0		0			0		0
Settlements	(7		)	0		0		0		0		0			0		(7		)
Transfers into Level 3	0			0		0		0		0		0			0		0
Transfers out of Level 3	0			0		0		0		0		0			0		0
Balance, end of period	$	188		$	53	$	25	$	77	$	14	$	7		$	2	$	366
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	$	0	$	(10	)	$	0	$	(10	)

⁽¹⁾ Derivative assets and liabilities are presented net



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

⁽¹⁾ Derivative assets and liabilities are presented net



Six Months Ended June 30, 2017
	Fixed Maturities									Equity Securities			Derivatives ⁽¹⁾
(In millions)	Mortgage- and Asset- Backed Securities			Public Utilities		Banks/ Financial Institutions		Other Corporate					Foreign Currency Swaps			Credit Default Swaps		Total
Balance, beginning of period	$	198		$	16	$	25	$	0	$	3		$	(21	)	$	2	$	223
Realized investment gains (losses) included in earnings	0			0		0		0		0			28			0		28
Unrealized gains (losses) included in other comprehensive income (loss)	6			0		0		2		0			0			0		8
Purchases, issuances, sales and settlements:
Purchases	0			37		0		75		12			0			0		124
Issuances	0			0		0		0		0			0			0		0
Sales	0			0		0		0		(1		)	0			0		(1		)
Settlements	(16		)	0		0		0		0			0			0		(16		)
Transfers into Level 3	0			0		0		0		0			0			0		0
Transfers out of Level 3	0			0		0		0		0			0			0		0
Balance, end of period	$	188		$	53	$	25	$	77	$	14		$	7		$	2	$	366
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	$	0		$	28		$	0	$	28

⁽¹⁾ Derivative assets and liabilities are presented net



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

⁽¹⁾ Derivative assets and liabilities are presented net

Fair Value Inputs Assets Quantitative Information

December 31, 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

198

Consensus pricing

Offered quotes

N/A

^(d)

Public utilities

Discounted cash flow

Historical volatility

N/A

^(d)

Banks/financial institutions

Consensus pricing

Offered quotes

N/A

^(d)

Equity securities

Net asset value

Offered quotes

$1-$701 ($8)

Other assets:

Foreign currency swaps

Discounted cash flow

Interest rates (USD)

2.34% - 2.59%

^(a)

Interest rates (JPY)

.22% - .80%

^(b)

CDS spreads

17 - 172 bps

Foreign exchange rates

21.47%

^(c)

Discounted cash flow

Interest rates (USD)

2.34% - 2.59%

^(a)

Interest rates (JPY)

.22% - .80%

^(b)

CDS spreads

16 - 88 bps

Discounted cash flow

Interest rates (USD)

2.34% - 2.59%

^(a)

Interest rates (JPY)

.22% - .80%

^(b)

Foreign exchange rates

21.47%

^(c)

Credit default swaps

Discounted cash flow

Base correlation

52.18% - 56.07%

^(e)

CDS spreads

54 bps

Recovery rate

36.69%

Total assets

369

(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, 2017

(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

188

Consensus pricing

Offered quotes

N/A

^(d)

Public utilities

Discounted cash flow

Historical volatility

N/A

^(d)

Banks/financial institutions

Consensus pricing

Offered quotes

N/A

^(d)

Other corporate

Discounted cash flow

Historical volatility

N/A

^(e)

Equity securities

Net asset value

Offered quotes

$1 - $729 ($6)

Other assets:

Foreign currency swaps

Discounted cash flow

Interest rates (USD)

2.30% - 2.58%

^(a)

Interest rates (JPY)

.28% - .85%

^(b)

CDS spreads

7 - 128 bps

Foreign exchange rates

21.15%

^(c)

Discounted cash flow

Interest rates (USD)

2.30% - 2.58%

^(a)

Interest rates (JPY)

.28% - .85%

^(b)

CDS spreads

11 - 73 bps

Discounted cash flow

Interest rates (USD)

2.30% - 2.58%

^(a)

Interest rates (JPY)

.28% - .85%

^(b)

Foreign exchange rates

21.15%

^(c)

Credit default swaps

Discounted cash flow

Base correlation

54.48% - 59.52%

^(e)

CDS spreads

19 bps

Recovery rate

36.58%

Total assets

499

(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, 2016

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Liabilities:

Other liabilities:

Foreign currency swaps

113

Discounted cash flow

Interest rates (USD)

2.34% - 2.59%

^(a)

Interest rates (JPY)

.22% - .80%

^(b)

CDS spreads

17 - 172 bps

Foreign exchange rates

21.47%

^(c)

Discounted cash flow

Interest rates (USD)

2.34% - 2.59%

^(a)

Interest rates (JPY)

.22% - .80%

^(b)

CDS spreads

24 - 216 bps

Discounted cash flow

Interest rates (USD)

2.34% - 2.59%

^(a)

Interest rates (JPY)

.22% - .80%

^(b)

Foreign exchange rates

21.47%

^(c)

Total liabilities

146

(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, 2017

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Liabilities:

Other liabilities:

Foreign currency swaps

111

Discounted cash flow

Interest rates (USD)

2.30% - 2.58%

^(a)

Interest rates (JPY)

.28% - .85%

^(b)

CDS spreads

7 - 128 bps

Foreign exchange rates

21.15%

^(c)

Discounted cash flow

Interest rates (USD)

2.30% - 2.58%

^(a)

Interest rates (JPY)

.28% - .85%

^(b)

CDS spreads

14 - 162 bps

Discounted cash flow

Interest rates (USD)

2.30% - 2.58%

^(a)

Interest rates (JPY)

.28% - .85%

^(b)

Foreign exchange rates

21.15%

^(c)

Total liabilities

133

(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