FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 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.



	September 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		$	29,067		$	971		$	0		$	30,038
Municipalities		0			1,292			0			1,292
Mortgage- and asset-backed securities		0			278			178			456
Public utilities		0			7,938			77			8,015
Sovereign and supranational		0			2,029			0			2,029
Banks/financial institutions		0			6,985			25			7,010
Other corporate		0			31,473			102			31,575
Total fixed maturities		29,067			50,966			382			80,415
Perpetual securities:
Banks/financial institutions		0			1,627			0			1,627
Other corporate		0			236			0			236
Total perpetual securities		0			1,863			0			1,863
Equity securities		905			5			18			928
Other assets:
Foreign currency swaps		0			154			147			301
Foreign currency forwards		0			160			0			160
Foreign currency options		0			17			0			17
Credit default swaps		0			0			1			1
Total other assets		0			331			148			479
Other investments		57			0			0			57
Cash and cash equivalents		4,927			0			0			4,927
Total assets		$	34,956		$	53,165		$	548		$	88,669
Liabilities:
Other liabilities:
Foreign currency swaps		$	0		$	64		$	132		$	196
Foreign currency forwards		0			754			0			754
Foreign currency options		0			24			0			24
Total liabilities		$	0		$	842		$	132		$	974



	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.



	September 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		$	21,385		$	26,455		$	0		$	0		$	26,455
Municipalities		359			0			463			0			463
Mortgage and asset-backed securities		27			0			9			20			29
Public utilities		3,308			0			3,734			0			3,734
Sovereign and supranational		1,527			0			1,846			0			1,846
Banks/financial institutions		2,700			0			2,887			0			2,887
Other corporate		2,692			0			3,185			0			3,185
Other investments ⁽¹⁾		2,011			0			15			1,985			2,000
Total assets		$	34,009		$	26,455		$	12,139		$	2,005		$	40,599
Liabilities:
Other policyholders’ funds		$	6,967		$	0		$	0		$	6,849		$	6,849
Notes payable (excluding capital leases)		5,230			506			4,780			265			5,551
Total liabilities		$	12,197		$	506		$	4,780		$	7,114		$	12,400

⁽¹⁾ Excludes policy loans of $207 and equity method investments of $83, 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 the Company's fixed maturities, perpetual securities, and equity securities.



	September 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		$	29,067		$	971		$	0		$	30,038
Total government and agencies		29,067			971			0			30,038
Municipalities:
Third party pricing vendor		0			1,292			0			1,292
Total municipalities		0			1,292			0			1,292
Mortgage- and asset-backed securities:
Third party pricing vendor		0			278			0			278
Broker/other		0			0			178			178
Total mortgage- and asset-backed securities		0			278			178			456
Public utilities:
Third party pricing vendor		0			7,938			0			7,938
Broker/other		0			0			77			77
Total public utilities		0			7,938			77			8,015
Sovereign and supranational:
Third party pricing vendor		0			2,029			0			2,029
Total sovereign and supranational		0			2,029			0			2,029
Banks/financial institutions:
Third party pricing vendor		0			6,985			0			6,985
Broker/other		0			0			25			25
Total banks/financial institutions		0			6,985			25			7,010
Other corporate:
Third party pricing vendor		0			31,473			0			31,473
Broker/other		0			0			102			102
Total other corporate		0			31,473			102			31,575
Total fixed maturities		29,067			50,966			382			80,415
Perpetual securities:
Banks/financial institutions:
Third party pricing vendor		0			1,627			0			1,627
Total banks/financial institutions		0			1,627			0			1,627
Other corporate:
Third party pricing vendor		0			236			0			236
Total other corporate		0			236			0			236
Total perpetual securities		0			1,863			0			1,863
Equity securities:
Third party pricing vendor		905			5			0			910
Broker/other		0			0			18			18
Total equity securities		905			5			18			928
Total securities available for sale		$	29,972		$	52,834		$	400		$	83,206



	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



	September 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		$	26,455		$	0		$	0		$	26,455
Total government and agencies		26,455			0			0			26,455
Municipalities:
Third party pricing vendor		0			463			0			463
Total municipalities		0			463			0			463
Mortgage- and asset-backed securities:
Third party pricing vendor		0			9			0			9
Broker/other		0			0			20			20
Total mortgage- and asset-backed securities		0			9			20			29
Public utilities:
Third party pricing vendor		0			3,734			0			3,734
Total public utilities		0			3,734			0			3,734
Sovereign and supranational:
Third party pricing vendor		0			1,846			0			1,846
Total sovereign and supranational		0			1,846			0			1,846
Banks/financial institutions:
Third party pricing vendor		0			2,887			0			2,887
Total banks/financial institutions		0			2,887			0			2,887
Other corporate:
Third party pricing vendor		0			3,185			0			3,185
Total other corporate		0			3,185			0			3,185
Total securities held to maturity		$	26,455		$	12,124		$	20		$	38,599



	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 nine-month periods ended September 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 the Company's available-for-sale investments and derivatives classified as Level 3.



Three Months Ended September 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	$	188		$	53	$	25	$	77		$	14	$	7	$	2		$	366
Realized investment gains (losses) included in earnings	0			0		0		0			0		8		(1		)	7
Unrealized gains (losses) included in other comprehensive income (loss)	(2		)	0		0		1			0		0		0			(1		)
Purchases, issuances, sales and settlements:
Purchases	0			24		0		25			4		0		0			53
Issuances	0			0		0		0			0		0		0			0
Sales	0			0		0		(1		)	0		0		0			(1		)
Settlements	(8		)	0		0		0			0		0		0			(8		)
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	$	178		$	77	$	25	$	102		$	18	$	15	$	1		$	416
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	$	8	$	(1	)	$	7

⁽¹⁾ Derivative assets and liabilities are presented net



Three Months Ended September 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	$	252		$	0	$	26	$	0	$	3		$	59		$	1	$	341
Realized investment gains (losses) included in earnings	0			0		0		0		0			(18		)	2		(16		)
Unrealized gains (losses) included in other comprehensive income (loss)	1			0		0		0		0			0			0		1
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	(13		)	0		0		0		0			0			0		(13		)
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	$	240		$	0	$	26	$	0	$	3		$	41		$	3	$	313
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		$	(18	)	$	2	$	(16	)

⁽¹⁾ Derivative assets and liabilities are presented net



Nine Months Ended September 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			36			(1		)	35
Unrealized gains (losses) included in other comprehensive income (loss)	4			0		0		3			0			0			0			7
Purchases, issuances, sales and settlements:
Purchases	0			61		0		100			16			0			0			177
Issuances	0			0		0		0			0			0			0			0
Sales	0			0		0		(1		)	(1		)	0			0			(2		)
Settlements	(24		)	0		0		0			0			0			0			(24		)
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	$	178		$	77	$	25	$	102		$	18		$	15		$	1		$	416
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		$	36		$	(1	)	$	35

⁽¹⁾ Derivative assets and liabilities are presented net



Nine Months Ended September 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		250			2		252
Unrealized gains (losses) included in other comprehensive income (loss)	48			0		0		0		0		(16		)	0		32
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	(28		)	0		0		0		0		(1		)	0		(29		)
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	$	240		$	0	$	26	$	0	$	3	$	41		$	3	$	313
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	$	250		$	2	$	252

⁽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 the Company's swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of the Company's swaps

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

(e) Range of base correlation for the Company's bespoke tranche for attachment and detachment points corresponding to market indices

The following tables summarize the significant unobservable inputs used in the valuation of the Company's 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.

September 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

178

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

102

Discounted cash flow

Historical volatility

N/A

^(e)

Equity securities

Net asset value

Offered quotes

$1 - $724 ($6)

Other assets:

Foreign currency swaps

Discounted cash flow

Interest rates (USD)

2.29% - 2.53%

^(a)

Interest rates (JPY)

.26% - .86%

^(b)

CDS spreads

11 - 116 bps

Foreign exchange rates

21.00%

^(c)

Discounted cash flow

Interest rates (USD)

2.29% - 2.53%

^(a)

Interest rates (JPY)

.26% - .86%

^(b)

CDS spreads

11 - 83 bps

Discounted cash flow

Interest rates (USD)

2.29% - 2.53%

^(a)

Interest rates (JPY)

.26% - .86%

^(b)

Foreign exchange rates

21.00%

^(c)

Credit default swaps

Discounted cash flow

Base correlation

62.73% - 66.88%

^(e)

CDS spreads

19 bps

Recovery rate

37.24%

Total assets

548

(a) Inputs derived from U.S. long-term rates to accommodate long maturity nature of the Company's swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of the Company's swaps

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

(e) Range of base correlation for the Company's 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 the Company's swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of the Company's swaps

September 30, 2017

(In millions)

Fair Value

Valuation Technique(s)

Unobservable Input

Range
(Weighted Average)

Liabilities:

Other liabilities:

Foreign currency swaps

112

Discounted cash flow

Interest rates (USD)

2.29% - 2.53%

^(a)

Interest rates (JPY)

.26% - .86%

^(b)

CDS spreads

11 - 116 bps

Foreign exchange rates

21.00%

^(c)

Discounted cash flow

Interest rates (USD)

2.29% - 2.53%

^(a)

Interest rates (JPY)

.26% - .86%

^(b)

CDS spreads

9 - 120 bps

Discounted cash flow

Interest rates (USD)

2.29% - 2.53%

^(a)

Interest rates (JPY)

.26% - .86%

^(b)

Foreign exchange rates

21.00%

^(c)

Total liabilities

132

(a) Inputs derived from U.S. long-term rates to accommodate long maturity nature of the Company's swaps

(b) Inputs derived from Japan long-term rates to accommodate long maturity nature of the Company's swaps