

	March 31, 2019
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
Securities available for sale, carried at fair value through other comprehensive income:
Fixed maturity securities:
Yen-denominated:
Japan government and agencies		$	31,238		$	4,813		$	2		$	36,049
Municipalities		509			93			3			599
Mortgage- and asset-backed securities		233			27			0			260
Public utilities		1,822			344			0			2,166
Sovereign and supranational		740			65			0			805
Banks/financial institutions		5,664			597			139			6,122
Other corporate		5,043			824			20			5,847
Total yen-denominated		45,249			6,763			164			51,848
U.S. dollar-denominated:
U.S. government and agencies		190			11			1			200
Municipalities		1,204			105			0			1,309
Mortgage- and asset-backed securities		147			7			0			154
Public utilities		3,841			522			32			4,331
Sovereign and supranational		276			73			0			349
Banks/financial institutions		2,798			484			13			3,269
Other corporate		25,001			2,061			598			26,464
Total U.S. dollar-denominated		33,457			3,263			644			36,076
Total securities available for sale		$	78,706		$	10,026		$	808		$	87,924



	December 31, 2018
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
Securities available for sale, carried at fair value through other comprehensive income:
Fixed maturity securities:
Yen-denominated:
Japan government and agencies		$	30,637		$	3,700		$	140		$	34,197
Municipalities		385			32			9			408
Mortgage- and asset-backed securities		155			22			0			177
Public utilities		1,732			280			4			2,008
Sovereign and supranational		826			123			0			949
Banks/financial institutions		5,440			502			238			5,704
Other corporate		4,852			649			44			5,457
Total yen-denominated		44,027			5,308			435			48,900
U.S dollar-denominated:
U.S. government and agencies		137			9			1			145
Municipalities		1,343			120			8			1,455
Mortgage- and asset-backed securities		155			8			1			162
Public utilities		4,772			496			105			5,163
Sovereign and supranational		251			60			0			311
Banks/financial institutions		2,860			389			35			3,214
Other corporate		23,311			1,343			1,109			23,545
Total U.S. dollar-denominated		32,829			2,425			1,259			33,995
Total securities available for sale		$	76,856		$	7,733		$	1,694		$	82,895



	March 31, 2019
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
Securities held to maturity, carried at amortized cost:
Fixed maturity securities:
Yen-denominated:
Japan government and agencies		$	21,961		$	6,018		$	0		$	27,979
Municipalities		814			247			0			1,061
Mortgage- and asset-backed securities		20			1			0			21
Public utilities		2,728			340			0			3,068
Sovereign and supranational		1,154			178			0			1,332
Banks/financial institutions		949			100			10			1,039
Other corporate		2,537			414			5			2,946
Total yen-denominated		30,163			7,298			15			37,446
Total securities held to maturity		$	30,163		$	7,298		$	15		$	37,446



	December 31, 2018
(In millions)	Cost or Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
Securities held to maturity, carried at amortized cost:
Fixed maturity securities:
Yen-denominated:
Japan government and agencies		$	21,712		$	5,326		$	0		$	27,038
Municipalities		359			110			0			469
Mortgage- and asset-backed securities		14			1			0			15
Public utilities		2,727			254			8			2,973
Sovereign and supranational		1,551			289			0			1,840
Banks/financial institutions		1,445			158			20			1,583
Other corporate		2,510			332			38			2,804
Total yen-denominated		30,318			6,470			66			36,722
Total securities held to maturity		$	30,318		$	6,470		$	66		$	36,722



(In millions)	Amortized Cost			Fair Value
Available for sale:
Due in one year or less		$	889		$	950
Due after one year through five years		8,483			8,624
Due after five years through 10 years		10,111			11,034
Due after 10 years		58,843			66,902
Mortgage- and asset-backed securities		380			414
Total fixed maturity securities available for sale		$	78,706		$	87,924
Held to maturity:
Due in one year or less		$	135		$	137
Due after one year through five years		1,112			1,187
Due after five years through 10 years		678			739
Due after 10 years		28,218			35,362
Mortgage- and asset-backed securities		20			21
Total fixed maturity securities held to maturity		$	30,163		$	37,446

Economic maturities are the expected maturity date created by the combination of features in the financial instrument. Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay obligations with or without call or prepayment penalties.

The Company's process for investing in credit-related investments begins with an independent approach to underwriting each issuer's fundamental credit quality. The Company evaluates independently those factors that it believes could influence an issuer's ability to make payments under the contractual terms of the Company's instruments. This includes a thorough analysis of a variety of items including the issuer's country of domicile (including political, legal, and financial considerations); the industry in which the issuer competes (with an analysis of industry structure, end-market dynamics, and regulation); company specific issues (such as management, assets, earnings, cash generation, and capital needs); and contractual provisions of the instrument (such as financial covenants and position in the capital structure). The Company further evaluates the investment considering broad business and portfolio management objectives, including asset/liability needs, portfolio diversification, and expected income.



	Three Months Ended March 31,
(In millions)	2019			2018
Realized investment gains (losses):
Fixed maturity securities:
Available for sale:
Gross gains from sales	$	12		$	10
Gross losses from sales	(8		)	(2		)
Foreign currency gains (losses) on sales and redemptions	13			(5		)
Total fixed maturity securities	17			3
Equity securities	58			(46		)
Loan receivables:
Loan loss reserves	(2		)	(7		)
Total loan receivables	(2		)	(7		)
Derivatives and other:
Derivative gains (losses)	0			144
Foreign currency gains (losses)	(2		)	(228		)
Total derivatives and other	(2		)	(84		)
Total realized investment gains (losses)	$	71		$	(134	)

The following tables show the fair values and gross unrealized losses of the Company's 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.



	March 31, 2019
	Total						Less than 12 months						12 months or longer
(In millions)	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses
Fixed maturity securities:
U.S. government and agencies:
U.S. dollar-denominated		$	65		$	1		$	65		$	1		$	0		$	0
Japan government and agencies:
Yen-denominated		139			2			139			2			0			0
Municipalities:
Yen-denominated		70			3			70			3			0			0
Mortgage- and asset- backed securities:
U.S. dollar-denominated		53			0			53			0			0			0
Public utilities:
U.S. dollar-denominated		808			32			306			14			502			18
Banks/financial institutions:
U.S. dollar-denominated		345			13			209			10			136			3
Yen-denominated		2,229			149			2,229			149			0			0
Other corporate:
U.S. dollar-denominated		9,182			598			3,149			213			6,033			385
Yen-denominated		525			25			525			25			0			0
Total		$	13,416		$	823		$	6,745		$	417		$	6,671		$	406



	December 31, 2018
	Total						Less than 12 months						12 months or longer
(In millions)	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses
Fixed maturity securities:
U.S. government and agencies:
U.S. dollar-denominated		$	67		$	1		$	67		$	1		$	0		$	0
Japan government and agencies:
Yen-denominated		3,604			140			3,604			140			0			0
Municipalities:
U.S. dollar-denominated		515			8			515			8			0			0
Yen-denominated		148			9			148			9			0			0
Mortgage- and asset- backed securities:
U.S. dollar-denominated		74			1			74			1			0			0
Public utilities:
U.S. dollar-denominated		1,585			105			892			48			693			57
Yen-denominated		604			12			604			12			0			0
Banks/financial institutions:
U.S. dollar-denominated		625			35			340			19			285			16
Yen-denominated		3,057			258			3,057			258			0			0
Other corporate:
U.S. dollar-denominated		12,899			1,109			5,782			407			7,117			702
Yen-denominated		1,306			82			1,306			82			0			0
Total		$	24,484		$	1,760		$	16,389		$	985		$	8,095		$	775

The unrealized losses on the Company's fixed maturity securities investments have been primarily related to general market changes in interest rates, foreign exchange rates, and/or the levels of credit spreads rather than specific concerns with the issuer's ability to pay interest and repay principal.

For any significant declines in fair value of its fixed maturity securities, the Company performs a more focused review of the related issuers' credit profile. For corporate issuers, the Company evaluates their assets, business profile including industry dynamics and competitive positioning, financial statements and other available financial data. For non-corporate issuers, the Company analyzes all sources of credit support, including issuer-specific factors. The Company utilizes information available in the public domain and, for certain private placement issuers, from consultations with the issuers directly. The Company also considers ratings from Nationally Recognized Statistical Rating Organizations (NRSROs), as well as the specific characteristics of the security it owns including seniority in the issuer's capital structure, covenant protections, or other relevant features. From these reviews, the Company evaluates the issuers' continued ability to service the Company's investment through payment of interest and principal.

Assuming no credit-related factors develop, unrealized gains and losses on fixed maturity securities are expected to diminish as investments near maturity. Based on its credit analysis, the Company believes that the issuers of its fixed maturity investments in the sectors shown in the table above have the ability to service their obligations to the Company.

The Company classifies its transitional real estate loans (TREs), commercial mortgage loans (CMLs) and middle market loans (MMLs) as held-for-investment and includes them in the commercial mortgage and other loans line on the consolidated balance sheets. The Company carries them on the balance sheet at amortized cost less an estimated allowance for loan losses.



(In millions)	March 31, 2019				December 31, 2018
Commercial mortgage and other loans:
Transitional real estate loans		$	4,398			$	4,394
Commercial mortgage loans		1,085				1,065
Middle market loans		1,726				1,487
Total gross commercial mortgage and other loans		7,209				6,946
Valuation allowance		(29		)		(27		)
Total net commercial mortgage and other loans		$	7,180			$	6,919

Transitional real estate loans are commercial mortgage loans that are typically relatively short-term floating rate instruments secured by a first lien on the property. These loans provide funding for properties undergoing a change in their physical characteristics and/or economic profile and do not typically require any principal repayment prior to the maturity date. This loan portfolio has guidelines that limit the average loan-to-value at origination to be 70% or lower with individual loan-to-value limits at origination of 80% or less. As of March 31, 2019, the Company had $733 million in outstanding commitments to fund transitional real estate loans. These commitments are contingent on the final underwriting and due diligence to be performed.

Commercial mortgage loans are typically fixed rate loans on commercial real estate with partial repayment of principal over the life of the loan with the remaining outstanding principal being repaid upon maturity. This loan portfolio has guidelines that limit the average loan-to-value at origination to be 65% or lower with individual loan-to-value limits at origination of 70% or less. As of March 31, 2019, the Company had $28 million in outstanding commitments to fund commercial mortgage loans. These commitments are contingent on the final underwriting and due diligence to be performed.

Middle market loans are typically first lien senior secured cash flow loans to small to mid-size companies for working capital, refinancing, acquisition, and recapitalization. These loans are generally considered to be below investment grade. The carrying value for middle market loans included an unfunded amount of $127 million and $56 million, as of March 31, 2019, and December 31, 2018, respectively, that is reflected in other liabilities on the consolidated balance sheets.

As of March 31, 2019, the Company had commitments of approximately $677 million to fund potential future loan originations related to this investment program. These commitments are contingent upon the availability of middle market loans that meet the Company's underwriting criteria.

The Company's allowance for loan losses is established using both general and specific allowances. The general allowance is used for loans grouped by similar risk characteristics where a loan-specific or market-specific risk has not been identified, but for which the Company estimates probable incurred losses. The specific allowance is used on an individual loan basis when it is probable that a loss has been incurred. There was no specific loan loss reserve as of March 31, 2019, and December 31, 2018. As of March 31, 2019, and December 31, 2018, the Company's general allowance for loan losses was $29 million and $27 million, respectively.



(In millions)	Commercial Mortgage Loans				Transitional Real Estate Loans				Middle Market Loans				Total
Allowance for loan losses at December 31, 2018		$	(1	)		$	(17	)		$	(9	)		$	(27	)
Addition to (release of) allowance for credit losses		0				(1		)		(1		)		(2		)
Allowance for loan losses at March 31, 2019		$	(1	)		$	(18	)		$	(10	)		$	(29	)

The key credit quality indicators used by the company in establishing the general and specific loan loss reserves, as well as in determining whether or not a loan should be impaired, include loan-to-value and debt service coverage ratios for CMLs and TREs and ratings for our middle market loan portfolio. Given that transitional real estate loans involve properties undergoing renovation or construction, loan-to-value provides the most insight on the credit risk of the property. The performance of the loans are monitored and reviewed periodically, but not less than quarterly.

As of March 31, 2019, and December 31, 2018, the Company had no loans that were past due in regards to principal and/or interest payments. Additionally, the Company held no loans that were on nonaccrual status or considered impaired as of March 31, 2019, and December 31, 2018. The Company had no troubled debt restructurings during the three months ended March 31, 2019 and 2018.

The Company's ownership interest in VIEs is limited to holding the obligations issued by them. The Company has no direct or contingent obligations to fund the limited activities of these VIEs, nor does it have any direct or indirect financial guarantees related to the limited activities of these VIEs. The Company has not provided any assistance or any other type of financing support to any of the VIEs it invests in, nor does it have any intention to do so in the future. For those VIEs in which the Company holds debt obligations, the weighted-average lives of the Company's notes are very similar to the underlying collateral held by these VIEs where applicable.

Investments in Consolidated Variable Interest Entities



	March 31, 2019						December 31, 2018
(In millions)	Cost or Amortized Cost			Fair Value			Cost or Amortized Cost			Fair Value
Assets:
Fixed maturity securities, available for sale		$	3,756		$	4,543		$	3,849		$	4,466
Equity securities		180			180			160			160
Commercial mortgage and other loans		5,892			5,894			5,528			5,506
Other investments ⁽¹⁾		374			374			328			328
Other assets ⁽²⁾		178			178			182			182
Total assets of consolidated VIEs		$	10,380		$	11,169		$	10,047		$	10,642
Liabilities:
Other liabilities ⁽²⁾		$	108		$	108		$	102		$	102
Total liabilities of consolidated VIEs		$	108		$	108		$	102		$	102

The Company is substantively the only investor in the consolidated VIEs listed in the table above. As the sole investor in these VIEs, the Company has the power to direct the activities of a variable interest entity that most significantly impact the entity's economic performance and is therefore considered to be the primary beneficiary of the VIEs that it consolidates. The Company also participates in substantially all of the variability created by these VIEs. The activities of these VIEs are limited to holding invested assets and foreign currency swaps, as appropriate, and utilizing the cash flows from these securities to service its investment. Neither the Company nor any of its creditors are able to obtain the underlying collateral of the VIEs unless there is an event of default or other specified event. For those VIEs that contain a swap, the Company is not a direct counterparty to the swap contracts and has no control over them. The Company's loss exposure to these VIEs is limited to its original investment. The Company's consolidated VIEs do not rely on outside or ongoing sources of funding to support their activities beyond the underlying collateral and swap contracts, if applicable. With the exception of its investment in unit trust structures, the underlying collateral assets and funding of the Company's consolidated VIEs are generally static in nature.



	March 31, 2019						December 31, 2018
(In millions)	Amortized Cost			Fair Value			Amortized Cost			Fair Value
Assets:
Fixed maturity securities, available for sale		$	4,455		$	5,025		$	4,575		$	4,982
Fixed maturity securities, held to maturity		2,006			2,331			2,007			2,254
Other investments ⁽¹⁾		59			59			49			49
Total investments in VIEs not consolidated		$	6,520		$	7,415		$	6,631		$	7,285

The Company holds alternative investments in limited partnerships that have been determined to be VIEs. These partnerships invest in private equity and structured investments. The Company’s maximum exposure to loss on these investments is limited to the amount of its investment. The Company is not the primary beneficiary of these VIEs and is therefore not required to consolidate them. The Company classifies these investments as Other investments in the consolidated balance sheets.

Certain investments in VIEs that the Company is not required to consolidate are investments that are in the form of debt obligations from the VIEs that are irrevocably and unconditionally guaranteed by their corporate parents or sponsors. These VIEs are the primary financing vehicles used by their corporate sponsors to raise financing in the capital markets. The variable interests created by these VIEs are principally or solely a result of the debt instruments issued by them. The Company does not have the power to direct the activities that most significantly impact the entity's economic performance, nor does it have the obligation to absorb losses of the entity or the right to receive benefits from the entity. As such, the Company is not the primary beneficiary of these VIEs and is therefore not required to consolidate them.

The Company lends fixed maturity and public equity securities to financial institutions in short-term security-lending transactions. These short-term security-lending arrangements increase investment income with minimal risk. The Company receives cash or other securities as collateral for such loans. The Company's security lending policy requires that the fair value of the securities received as collateral be 102% or more of the fair value of the loaned securities and that unrestricted cash received as collateral be 100% or more of the fair value of the loaned securities. The securities loaned continue to be carried as investment assets on the Company's balance sheet during the terms of the loans and are not reported as sales. For loans involving unrestricted cash or securities as collateral, the collateral is reported as an asset with a corresponding liability for the return of the collateral. For loans where the Company receives as collateral securities that the Company is not permitted to sell or repledge, the collateral is not reflected on the consolidated financial statements.



Securities Lending Transactions Accounted for as Secured Borrowings
March 31, 2019
Remaining Contractual Maturity of the Agreements
(In millions)	Overnight and Continuous⁽¹⁾		Up to 30 days		Greater than 90 days		Total
Securities lending transactions:
Fixed maturity securities:
Japan government and agencies	$	0	$	1,101	$	1,901	$	3,002
Public utilities	15		0		0		15
Banks/financial institutions	74		0		0		74
Other corporate	764		0		0		764
Equity securities	15		0		0		15
Total borrowings	$	868	$	1,101	$	1,901	$	3,870
Gross amount of recognized liabilities for securities lending transactions							$	1,969
Amounts related to agreements not included in offsetting disclosure in Note 4							$	1,901



Securities Lending Transactions Accounted for as Secured Borrowings
December 31, 2018
Remaining Contractual Maturity of the Agreements
(In millions)	Overnight and Continuous⁽¹⁾		Up to 30 days		Greater than 90 days		Total
Securities lending transactions:
Fixed maturity securities:
Japan government and agencies	$	0	$	387	$	1,190	$	1,577
Municipalities	5		0		0		5
Public utilities	27		0		0		27
Banks/financial institutions	74		0		0		74
Other corporate	549		0		0		549
Equity securities	10		0		0		10
Total borrowings	$	665	$	387	$	1,190	$	2,242
Gross amount of recognized liabilities for securities lending transactions							$	1,052
Amounts related to agreements not included in offsetting disclosure in Note 4							$	1,190