BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2018

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



	Pension Benefits																Other
	Japan								U.S.								Postretirement Benefits
(In millions)	2018				2017				2018				2017				2018					2017
Projected benefit obligation:
Benefit obligation, beginning of year		$	341			$	329			$	908			$	798			$	36				$	37
Service cost		19				20				27				24				0					0
Interest cost		7				6				31				40				1					1
Actuarial (gain) loss		35				(10		)		(69		)		65				4					0
Benefits and expenses paid		(11		)		(14		)		(22		)		(19		)		(4		)			(2		)
Effect of foreign exchange rate changes		5				10				0				0				0					0
Benefit obligation, end of year		396				341				875				908				37					36

Plan assets:
Fair value of plan assets, beginning of year		270				229				448				359				0					0
Actual return on plan assets		(9		)		16				(30		)		61				0					0
Employer contributions		34				32				69				47				4					2
Benefits and expenses paid		(11		)		(14		)		(22		)		(19		)		(4		)			(2		)
Effect of foreign exchange rate changes		5				7				0				0				0					0
Fair value of plan assets, end of year		289				270				465				448				0					0
Funded status of the plans⁽¹⁾		$	(107	)		$	(71	)		$	(410	)		$	(460	)		$	(37	)			$	(36	)

Amounts recognized in accumulated other comprehensive income:
Net actuarial (gain) loss		$	95			$	44			$	174			$	203			$	9				$	6
Prior service (credit) cost		(2		)		(2		)		(4		)		(4		)		0					0
Total included in accumulated other comprehensive income		$	93			$	42			$	170			$	199			$	9				$	6
Accumulated benefit obligation		$	356			$	307			$	746			$	756			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
	2018			2017			2016			2018			2017			2016			2018			2017			2016
Weighted-average actuarial assumptions:
Discount rate - net periodic benefit cost	1.25	%		1.25	%		1.75	%		3.75	%		4.25	%		4.50	%		3.75	%		4.25	%		4.50	%
Discount rate - benefit obligations	1.25			1.25			1.25			4.25			3.75			4.25			4.25			3.75			4.25
Expected long-term return on plan assets	2.00			2.00			2.00			6.50			6.75			7.00			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⁾	7.40		⁽²⁾	5.40		⁽²⁾	5.20		⁽²⁾

⁽¹⁾ Not applicable⁽²⁾For the years 2018, 2017 and 2016, the health care cost trend rates are expected to trend down to 4.1% in 61 years, 4.5% in 77 years, and 4.5% in 74 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, 2018:



(In millions)
One percentage point increase:
Increase in total service and interest costs	$	0
Increase in postretirement benefit obligation	1

One percentage point decrease:
Decrease in total service and interest costs	$	0
Decrease in postretirement benefit obligation	1

Schedule of Net Benefit Costs

Pension and other postretirement benefit expenses are included in acquisition and operating expenses in the consolidated statements of earnings, which includes $25 million, $35 million and $17 million of other components of net periodic pension cost and postretirement costs (other than services costs) for the years ended December 31, 2018, 2017 and 2016, respectively. Total net periodic benefit cost includes the following components:



	Pension Benefits																								Other
		Japan											U.S.												Postretirement Benefits
(In millions)	2018				2017				2016				2018				2017				2016				2018			2017			2016
Service cost		$	19			$	20			$	16			$	27			$	24			$	23			$	0		$	0		$	1
Interest cost		7				6				9				31				40				29				1			1			2
Expected return on plan assets		(6		)		(5		)		(4		)		(26		)		(24		)		(23		)		0			0			0
Amortization of net actuarial loss		1				2				1				16				14				13				1			1			1
Amortization of prior service cost (credit)		0				0				0				0				0				0				0			0			(11		)
Net periodic (benefit) cost		$	21			$	23			$	22			$	48			$	54			$	42			$	2		$	2		$	(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)	2018				2017				2016				2018				2017				2016				2018				2017				2016
Net actuarial loss (gain)		$	52			$	(21	)		$	26			$	(13	)		$	28			$	27			$	4			$	0			$	(4	)
Amortization of net actuarial loss		(1		)		(2		)		(1		)		(16		)		(14		)		(13		)		(1		)		(1		)		(1		)
Amortization of prior service cost		0				0				0				0				0				0				0				0				11
Total		$	51			$	(23	)		$	25			$	(29	)		$	14			$	14			$	3			$	(1	)		$	6

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
2019		$	12		$	25		$	3
2020		12			26			3
2021		12			27			4
2022		19			36			4
2023		15			34			4
2024-2028		89			199			17

Schedule of Allocation of Plan Assets

Asset allocation targets as of December 31, 2018 were as follows:



	Japan Pension			U.S. Pension
Domestic equities		5	%		40	%
International equities		18			20
Fixed income securities		66			40
Other		11			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)	2018			2017
Japan pension plan assets:
Equities:
Japanese equity securities		$	14		$	37
International equity securities		50			50
Fixed income securities:
Japanese bonds		34			91
International bonds		160			62
Insurance contracts		31			30
Total		$	289		$	270

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)	2018			2017
U.S. pension plan assets:
Mutual funds:
Large cap equity funds		$	120		$	124
Mid cap equity funds		17			22
Real estate equity funds		13			13
International equity funds		92			108
Fixed income bond funds		179			175
Aflac Incorporated common stock		5			5
Cash and cash equivalents		39			1
Total		$	465		$	448