FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2012

FAIR VALUE MEASUREMENTS

Assets and liabilities measured at fair value on a recurring basis

December 31, 2012 (in millions)	Level 1		Level 2		Level 3		Counterparty Netting(a)			Cash Collateral(b)			Total
Assets:
Bonds available for sale:
U.S. government and government sponsored entities	$	–	$	3,483	$	–	$	–		$	–		$	3,483
Obligations of states, municipalities and political subdivisions		–		34,681		1,024		–			–			35,705
Non-U.S. governments		1,004		25,782		14		–			–			26,800
Corporate debt		–		149,625		1,487		–			–			151,112
RMBS		–		22,730		11,662		–			–			34,392
CMBS		–		5,010		5,124		–			–			10,134
CDO/ABS		–		3,492		4,841		–			–			8,333
Total bonds available for sale		1,004		244,803		24,152		–			–			269,959
Bond trading securities:
U.S. government and government sponsored entities		266		6,528		–		–			–			6,794
Obligations of states, municipalities and political subdivisions		–		–		–		–			–			–
Non-U.S. governments		–		2		–		–			–			2
Corporate debt		–		1,320		–		–			–			1,320
RMBS		–		1,331		396		–			–			1,727
CMBS		–		1,424		812		–			–			2,236
CDO/ABS		–		3,969		8,536		–			–			12,505
Total bond trading securities		266		14,574		9,744		–			–			24,584
Equity securities available for sale:
Common stock		3,002		3		24		–			–			3,029
Preferred stock		–		34		44		–			–			78
Mutual funds		83		22		–		–			–			105
Total equity securities available for sale		3,085		59		68		–			–			3,212
Equity securities trading		578		84		–		–			–			662
Mortgage and other loans receivable		–		134		–		–			–			134
Other invested assets		125		1,542		5,389		–			–			7,056
Derivative assets:
Interest rate contracts		2		5,521		956		–			–			6,479
Foreign exchange contracts		–		104		–		–			–			104
Equity contracts		104		63		54		–			–			221
Commodity contracts		–		144		1		–			–			145
Credit contracts		–		–		60		–			–			60
Other contracts		–		–		38		–			–			38
Counterparty netting and cash collateral		–		–		–		(2,467	)		(909	)		(3,376	)
Total derivative assets		106		5,832		1,109		(2,467	)		(909	)		3,671
Short-term investments		285		7,771		–		–			–			8,056
Separate account assets		54,430		2,907		–		–			–			57,337
Other assets		–		696		–		–			–			696
Total	$	59,879	$	278,402	$	40,462	$	(2,467	)	$	(909	)	$	375,367
Liabilities:
Policyholder contract deposits	$	–	$	–	$	1,257	$	–		$	–		$	1,257
Derivative liabilities:
Interest rate contracts		–		5,582		224		–			–			5,806
Foreign exchange contracts		–		174		–		–			–			174
Equity contracts		–		114		7		–			–			121
Commodity contracts		–		146		–		–			–			146
Credit contracts(d)		–		–		2,051		–			–			2,051
Other contracts		–		6		200		–			–			206
Counterparty netting and cash collateral		–		–		–		(2,467	)		(1,976	)		(4,443	)
Total derivative liabilities		–		6,022		2,482		(2,467	)		(1,976	)		4,061
Long-term debt(e)		–		7,711		344		–			–			8,055
Other liabilities		30		1,050		–		–			–			1,080
Total	$	30	$	14,783	$	4,083	$	(2,467	)	$	(1,976	)	$	14,453

December 31, 2011 (in millions)	Level 1		Level 2		Level 3		Counterparty Netting(a)			Cash Collateral(b)			Total
Assets:
Bonds available for sale:
U.S. government and government sponsored entities	$	174	$	5,904	$	–	$	–		$	–		$	6,078
Obligations of states, municipalities and political subdivisions		–		36,538		960		–			–			37,498
Non-U.S. governments		259		25,467		9		–			–			25,735
Corporate debt		–		142,883		1,935		–			–			144,818
RMBS		–		23,727		10,877		–			–			34,604
CMBS		–		3,991		3,955		–			–			7,946
CDO/ABS		–		3,082		4,220		–			–			7,302
Total bonds available for sale		433		241,592		21,956		–			–			263,981
Bond trading securities:
U.S. government and government sponsored entities		100		6,362		–		–			–			6,462
Obligations of states, municipalities and political subdivisions		–		257		–		–			–			257
Non-U.S. governments		–		35		–		–			–			35
Corporate debt		–		809		7		–			–			816
RMBS		–		1,345		303		–			–			1,648
CMBS		–		1,283		554		–			–			1,837
CDO/ABS		–		4,877		8,432		–			–			13,309
Total bond trading securities		100		14,968		9,296		–			–			24,364
Equity securities available for sale:
Common stock		3,294		70		57		–			–			3,421
Preferred stock		–		44		99		–			–			143
Mutual funds		55		5		–		–			–			60
Total equity securities available for sale		3,349		119		156		–			–			3,624
Equity securities trading		43		82		–		–			–			125
Mortgage and other loans receivable		–		106		1		–			–			107
Other invested assets(c)		12,549		1,709		6,618		–			–			20,876
Derivative assets:
Interest rate contracts		2		7,251		1,033		–			–			8,286
Foreign exchange contracts		–		143		2		–			–			145
Equity contracts		92		133		38		–			–			263
Commodity contracts		–		134		2		–			–			136
Credit contracts		–		–		89		–			–			89
Other contracts		29		462		250		–			–			741
Counterparty netting and cash collateral		–		–		–		(3,660	)		(1,501	)		(5,161	)
Total derivative assets		123		8,123		1,414		(3,660	)		(1,501	)		4,499
Short-term investments		2,309		3,604		–		–			–			5,913
Separate account assets		48,502		2,886		–		–			–			51,388
Total	$	67,408	$	273,189	$	39,441	$	(3,660	)	$	(1,501	)	$	374,877
Liabilities:
Policyholder contract deposits	$	–	$	–	$	918	$	–		$	–		$	918
Derivative liabilities:
Interest rate contracts		–		6,661		248		–			–			6,909
Foreign exchange contracts		–		178		–		–			–			178
Equity contracts		–		198		10		–			–			208
Commodity contracts		–		146		–		–			–			146
Credit contracts(d)		–		4		3,362		–			–			3,366
Other contracts		–		155		217		–			–			372
Counterparty netting and cash collateral		–		–		–		(3,660	)		(2,786	)		(6,446	)
Total derivative liabilities		–		7,342		3,837		(3,660	)		(2,786	)		4,733
Long-term debt(e)		–		10,258		508		–			–			10,766
Other liabilities		193		714		–		–			–			907
Total	$	193	$	18,314	$	5,263	$	(3,660	)	$	(2,786	)	$	17,324

(a)     Represents netting of derivative exposures covered by a qualifying master netting agreement.

(b)     Represents cash collateral posted and received. Securities collateral posted for derivative transactions that is reflected in Fixed maturity securities in the Consolidated Balance Sheet, and collateral received, not reflected in the Consolidated Balance Sheet, were $1.9 billion and $299 million, respectively, at December 31, 2012 and $1.8 billion and $100 million, respectively, at December 31, 2011.

(c)     Level 1 Other invested assets included $12.4 billion at December 31, 2011 of AIA ordinary shares publicly traded on the Hong Kong Stock Exchange.

(d)     Level 3 Credit contracts included the fair value derivative liability on the super senior credit default swap portfolio of $2.0 billion and $3.2 billion at December 31, 2012 and 2011, respectively.

(e)     Includes Guaranteed Investment Agreements (GIAs), notes, bonds, loans and mortgages payable.

Changes in Level 3 recurring fair value measurements

(in millions)	Fair value Beginning of Year(a)			Net Realized and Unrealized Gains (Losses) Included in Income			Accumulated Other Comprehensive Income (Loss)			Purchases, Sales, Issues and Settlements, Net			Gross Transfers in			Gross Transfers out			Fair value End of Year			Changes in Unrealized Gains (Losses) Included in Income on Instruments Held at End of Year
December 31, 2012
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	960		$	48		$	12		$	84		$	70		$	(150	)	$	1,024		$	–
Non-U.S. governments		9			1			(1	)		1			4			–			14			–
Corporate debt		1,935			(44	)		145			24			664			(1,237	)		1,487			–
RMBS		10,877			522			2,121			(316	)		952			(2,494	)		11,662			–
CMBS		3,955			(135	)		786			636			44			(162	)		5,124			–
CDO/ABS		4,220			334			289			10			691			(703	)		4,841			–
Total bonds available for sale		21,956			726			3,352			439			2,425			(4,746	)		24,152			–
Bond trading securities:
Corporate debt		7			–			–			(7	)		–			–			–			–
RMBS		303			76			2			(109	)		128			(4	)		396			42
CMBS		554			70			2			(159	)		446			(101	)		812			87
CDO/ABS		8,432			3,683			3			(3,968	)		386			–			8,536			2,547
Total bond trading securities		9,296			3,829			7			(4,243	)		960			(105	)		9,744			2,676
Equity securities available for sale:
Common stock		57			22			(28	)		(33	)		6			–			24			–
Preferred stock		99			17			(35	)		(36	)		11			(12	)		44			–
Total equity securities available for sale		156			39			(63	)		(69	)		17			(12	)		68			–
Mortgage and other loans receivable		1			–			–			(1	)		–			–			–			–
Other invested assets		6,618			(95	)		290			(257	)		1,204			(2,371	)		5,389			–
Total	$	38,027		$	4,499		$	3,586		$	(4,131	)	$	4,606		$	(7,234	)	$	39,353		$	2,676
Liabilities:
Policyholder contract deposits	$	(918	)	$	(275	)	$	(72	)	$	8		$	–		$	–		$	(1,257	)	$	112
Derivative liabilities, net:
Interest rate contracts		785			(11	)		–			(42	)		–			–			732			56
Foreign exchange contracts		2			–			–			(2	)		–			–			–			–
Equity contracts		28			10			–			12			(3	)		–			47			(10	)
Commodity contracts		2			5			–			(6	)		–			–			1			(6	)
Credit contracts		(3,273	)		638			–			644			–			–			(1,991	)		(1,172	)
Other contracts		33			(76	)		(18	)		15			(116	)		–			(162	)		46
Total derivative liabilities, net		(2,423	)		566			(18	)		621			(119	)		–			(1,373	)		(1,086	)
Long-term debt(b)		(508	)		(411	)		(77	)		242			(14	)		424			(344	)		105
Total	$	(3,849	)	$	(120	)	$	(167	)	$	871		$	(133	)	$	424		$	(2,974	)	$	(869	)

(in millions)	Fair value Beginning of Year(a)			Net Realized and Unrealized Gains (Losses) Included in Income			Accumulated Other Comprehensive Income (Loss)			Purchases, Sales, Issues and Settlements, Net			Gross Transfers In			Gross Transfers Out			Fair value End of Year			Changes in Unrealized Gains (Losses) Included in Income on Instruments Held at End of Year
December 31, 2011
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	609		$	2		$	112		$	296		$	17		$	(76	)	$	960		$	–
Non-U.S. governments		5			–			–			5			–			(1	)		9			–
Corporate debt		2,262			11			(25	)		171			2,480			(2,964	)		1,935			–
RMBS		6,367			(50	)		288			3,232			1,093			(53	)		10,877			–
CMBS		3,604			(100	)		239			207			134			(129	)		3,955			–
CDO/ABS		4,241			73			142			(432	)		852			(656	)		4,220			–
Total bonds available for sale		17,088			(64	)		756			3,479			4,576			(3,879	)		21,956			–
Bond trading securities:
Corporate debt		–			–			–			(11	)		18			–			7			1
RMBS		91			(27	)		–			239			–			–			303			(28	)
CMBS		506			92			–			(95	)		292			(241	)		554			87
CDO/ABS		9,431			(660	)		–			(323	)		48			(64	)		8,432			(677	)
Total bond trading securities		10,028			(595	)		–			(190	)		358			(305	)		9,296			(617	)
Equity securities available for sale:
Common stock		61			28			(4	)		(40	)		18			(6	)		57			–
Preferred stock		64			(1	)		32			(1	)		5			–			99			–
Mutual funds		–			–			–			(6	)		6			–			–			–
Total equity securities available for sale		125			27			28			(47	)		29			(6	)		156			–
Equity securities trading		1			–			–			(1	)		–			–			–			–
Mortgage and other loans receivable		–			–			–			1			–			–			1			–
Other invested assets		7,414			(10	)		139			(739	)		251			(437	)		6,618			2
Total	$	34,656		$	(642	)	$	923		$	2,503		$	5,214		$	(4,627	)	$	38,027		$	(615	)
Liabilities:
Policyholder contract deposits	$	(445	)	$	(429	)	$	–		$	(44	)	$	–		$	–		$	(918	)	$	508
Derivative liabilities, net:
Interest rate contracts		732			46			–			(2	)		30			(21	)		785			(90	)
Foreign exchange contracts		16			(11	)		–			(5	)		2			–			2			1
Equity contracts		22			(16	)		–			41			(7	)		(12	)		28			(15	)
Commodity contracts		23			1			–			(22	)		–			–			2			(1	)
Credit contracts		(3,798	)		332			–			193			–			–			(3,273	)		493
Other contracts		(112	)		(14	)		(51	)		74			(30	)		166			33			(98	)
Total derivatives liabilities, net		(3,117	)		338			(51	)		279			(5	)		133			(2,423	)		290
Long-term debt(b)		(982	)		(60	)		–			555			(21	)		–			(508	)		(135	)
Total	$	(4,544	)	$	(151	)	$	(51	)	$	790		$	(26	)	$	133		$	(3,849	)	$	663

(a)     Total Level 3 derivative exposures have been netted in these tables for presentation purposes only.

(b)     Includes GIAs, notes, bonds, loans and mortgages payable.

Schedule of net realized and unrealized gains and losses related to Level 3 items

(in millions)	Net Investment Income			Net Realized Capital Gains (Losses)			Other Income			Total
December 31, 2012
Bonds available for sale	$	906		$	(395	)	$	215		$	726
Bond trading securities		3,303			–			526			3,829
Equity securities		–			39			–			39
Other invested assets		54			(210	)		61			(95	)
Policyholder contract deposits		–			(275	)		–			(275	)
Derivative liabilities, net		3			26			537			566
Other long-term debt		–			–			(411	)		(411	)
December 31, 2011
Bonds available for sale	$	638		$	(717	)	$	15		$	(64	)
Bond trading securities		(634	)		4			35			(595	)
Equity securities		–			27			–			27
Other invested assets		23			(84	)		51			(10	)
Policyholder contract deposits		–			(499	)		70			(429	)
Derivative liabilities, net		2			13			323			338
Other long-term debt		–			–			(60	)		(60	)

Gross components of purchases, sales, issuances and settlements, net

(in millions)	Purchases		Sales			Settlements			Purchases, Sales, Issues and Settlements, Net(a)
December 31, 2012
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	477	$	(219	)	$	(174	)	$	84
Non-U.S. governments		5		(3	)		(1	)		1
Corporate debt		283		(75	)		(184	)		24
RMBS		2,308		(723	)		(1,901	)		(316	)
CMBS		1,137		(318	)		(183	)		636
CDO/ABS		1,120		(4	)		(1,106	)		10
Total bonds available for sale		5,330		(1,342	)		(3,549	)		439
Bond trading securities:
Corporate debt		–		–			(7	)		(7	)
RMBS		–		(45	)		(64	)		(109	)
CMBS		225		(106	)		(278	)		(159	)
CDO/ABS(b)		7,382		(21	)		(11,329	)		(3,968	)
Total bond trading securities		7,607		(172	)		(11,678	)		(4,243	)
Equity securities		67		(56	)		(80	)		(69	)
Mortgage and other loans receivable		–		–			(1	)		(1	)
Other invested assets		900		(100	)		(1,057	)		(257	)
Total assets	$	13,904	$	(1,670	)	$	(16,365	)	$	(4,131	)
Liabilities:
Policyholder contract deposits	$	–	$	(25	)	$	33		$	8
Derivative liabilities, net		11		(2	)		612			621
Other long-term debt(c)		–		–			242			242
Total liabilities	$	11	$	(27	)	$	887		$	871
December 31, 2011
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	305	$	(4	)	$	(5	)	$	296
Non-U.S. governments		4		(2	)		3			5
Corporate debt		497		(27	)		(299	)		171
RMBS		4,932		(205	)		(1,495	)		3,232
CMBS		470		(34	)		(229	)		207
CDO/ABS		1,067		(1	)		(1,498	)		(432	)
Total bonds available for sale		7,275		(273	)		(3,523	)		3,479
Bond trading securities:
Corporate debt		–		–			(11	)		(11	)
RMBS		305		(1	)		(65	)		239
CMBS		221		(207	)		(109	)		(95	)
CDO/ABS		331		(304	)		(350	)		(323	)
Total bond trading securities		857		(512	)		(535	)		(190	)
Equity securities		–		(31	)		(17	)		(48	)
Mortgage and other loans receivable		–		–			1			1
Other invested assets		718		(296	)		(1,161	)		(739	)
Total assets	$	8,850	$	(1,112	)	$	(5,235	)	$	2,503
Liabilities:
Policyholder contract deposits	$	–	$	(70	)	$	26		$	(44	)
Derivative liabilities, net		43		–			236			279
Other long-term debt(c)		–		–			555			555
Total liabilities	$	43	$	(70	)	$	817		$	790

(a)     There were no issuances during year ended December 31, 2012.

(b)     Includes $7.1 billion of securities purchased through the FRBNY's auction of ML III assets.

(c)     Includes GIAs, notes, bonds, loans and mortgages payable.

Significant unobservable inputs used for recurring fair value measurements

(in millions)	Fair Value at December 31, 2012		Valuation Technique	Unobservable Input(a)	Range (Weighted Average )(a)
Assets:
Corporate debt	$	775	Discounted cash flow	Yield(b)	0.08% - 6.55% (3.31%)
RMBS		10,650	Discounted cash flow	Constant prepayment rate(c)	0.00% - 10.76% (5.03%)
				Loss severity(c)	43.70% - 78.72% (61.21%)
				Constant default rate(c)	4.21% - 13.30% (8.75%)
				Yield(c)	2.23% - 9.42% (5.82%)
Certain CDO/ABS(d)		7,844	Discounted cash flow	Constant prepayment rate(c)	0.00% - 32.25% (11.82%)
				Loss severity(c)	0.00% - 29.38% (6.36%)
				Constant default rate(c)	0.00% - 4.05% (1.18%)
				Yield(c)	5.41% - 10.67% (8.04%)
Commercial mortgage backed securities		3,251	Discounted cash flow	Yield(b)	0.00% - 19.95% (7.76%)
CDO/ABS – Direct			Binomial Expansion	Recovery rate(b)	3% - 63% (27%)
Investment Book		1,205	Technique (BET)	Diversity score(b)	4 - 44 (13)
				Weighted average life(b)	1.27 - 9.11 years (4.91 years)
Liabilities:
Policyholder contract deposits – GMWB		1,257	Discounted cash flow	Equity implied volatility(b)	6.0% - 39.0%
				Base lapse rates(b)	1.00% - 40.0%
				Dynamic lapse rates(b)	0.2% - 60.0%
				Mortality rates(b)	0.5% - 40.0%
				Utilization rates(b)	0.5% - 25.0%
Derivative Liabilities – Credit contracts		1,436	BET	Recovery rates(b)	3% - 37% (17%)
				Diversity score(b)	9 - 38 (14)
				Weighted average life(b)	5.10 - 8.45 years (5.75 years)

(a)     The unobservable inputs and ranges for the constant prepayment rate, loss severity and constant default rate relate to each of the individual underlying mortgage loans that comprise the entire portfolio of securities in the RMBS and CDO securitization vehicles and not necessarily to the securitization vehicle bonds (tranches) purchased by us. The ranges of these inputs do not directly correlate to changes in the fair values of the tranches purchased by us because there are other factors relevant to the specific tranches owned by us including, but not limited to, purchase price, position in the waterfall, senior versus subordinated position and attachment points.

(b)     Represents discount rates, estimates and assumptions that we believe would be used by market participants when valuing these assets and liabilities.

(c)     Information received from independent third-party valuation service providers.

(d)     Yield was the only input available for $6.6 billion of total fair value at December 31, 2012.

Investments in Certain Entities Carried at Fair Value Using Net Asset Value per Share

		December 31, 2012				December 31, 2011
(in millions)	Investment Category Includes	Fair Value Using Net Asset Value Per Share (or its equivalent)		Unfunded Commitments		Fair Value Using Net Asset Value Per Share (or its equivalent)		Unfunded Commitments
Investment Category
Private equity funds:
Leveraged buyout	Debt and/or equity investments made as part of a transaction in which assets of mature companies are acquired from the current shareholders, typically with the use of financial leverage	$	2,549	$	659	$	3,185	$	945
Non-U.S.	Investments that focus primarily on Asian and European based buyouts, expansion capital, special situations, turnarounds, venture capital, mezzanine and distressed opportunities strategies		179		25		165		57
Venture capital	Early-stage, high-potential, growth companies expected to generate a return through an eventual realization event, such as an initial public offering or sale of the company		163		16		316		39
Distressed	Securities of companies that are already in default, under bankruptcy protection, or troubled		87		21		182		42
Other	Real estate, energy, multi-strategy, mezzanine, and industry-focused strategies		255		152		252		98
Total private equity funds			3,233		873		4,100		1,181
Hedge funds:
Event-driven	Securities of companies undergoing material structural changes, including mergers, acquisitions and other reorganizations		747		2		774		2
Long-short	Securities that the manager believes are undervalued, with corresponding short positions to hedge market risk		1,091		–		927		–
Macro	Investments that take long and short positions in financial instruments based on a top-down view of certain economic and capital market conditions		238		–		173		–
Distressed	Securities of companies that are already in default, under bankruptcy protection or troubled		316		–		272		10
Other	Non-U.S. companies, futures and commodities, relative value, and multi-strategy and industry-focused strategies		416		–		627		–
Total hedge funds			2,808		2		2,773		12
Total		$	6,041	$	875	$	6,873	$	1,193

Gains or losses related to the eligible instruments for which AIG elected the fair value option

	Gain (Loss)
Years Ended December 31, (in millions)
	2012			2011			2010
Assets:
Mortgage and other loans receivable	$	47		$	11		$	53
Bonds and equity securities		2,339			1,273			2,060
Trading – ML II interest		246			42			513
Trading – ML III interest		2,888			(646	)		1,792
Retained interest in AIA		2,069			1,289			(638	)
Other, including Short-term investments		56			35			(39	)
Liabilities:
Policyholder contract deposits		–			–			(320	)
Long-term debt(a)		(681	)		(966	)		(1,595	)
Other liabilities		(33	)		(67	)		(8	)
Total gain(b)	$	6,931		$	971		$	1,818

(a)     Includes GIAs, notes, bonds, loans and mortgages payable.

(b)     Excludes discontinued operation gains or losses on instruments that were required to be carried at fair value. For instruments required to be carried at fair value, we recognized gains of $586 million, $1.3 billion and $4.9 billion for the years ended 2012, 2011 and 2010, respectively, that were primarily due to changes in the fair value of derivatives, trading securities and certain other invested assets for which the fair value option was not elected.

Difference between fair values and aggregate contractual principal amounts, fair value option

	December 31, 2012							December 31, 2011
(in millions)	Fair Value		Outstanding Principal Amount		Difference			Fair Value		Outstanding Principal Amount		Difference
Assets:
Mortgage and other loans receivable	$	134	$	141	$	(7	)	$	107	$	150	$	(43	)
Liabilities:
Long-term debt*	$	8,055	$	5,705	$	2,350		$	10,766	$	8,624	$	2,142

*         Includes GIAs, notes, bonds, loans and mortgages payable.

Fair value assets measured on nonrecurring basis and impairment charges

	Assets at Fair Value								Impairment Charges
	Non-Recurring Basis								December 31,
(in millions)	Level 1		Level 2		Level 3		Total		2012		2011		2010
December 31, 2012
Investment real estate	$	–	$	–	$	–	$	–	$	–	$	18	$	604
Other investments		–		–		2,062		2,062		460		639		323
Aircraft(a)		–		–		–		–		–		1,693		1,614
Other assets		–		3		18		21		11		3		5
Total	$	–	$	3	$	2,080	$	2,083	$	471	$	2,353	$	2,546
December 31, 2011
Investment real estate	$	–	$	–	$	457	$	457
Other investments		–		–		2,199		2,199
Aircraft(b)		–		–		1,683		1,683
Other assets		–		–		4		4
Total	$	–	$	–	$	4,343	$	4,343

(a)     See Note 4 for a discussion on the ILFC Transaction.

(b)     Fair value of Aircraft includes aircraft impairment charges.

Carrying value and estimated fair value of AIG's financial instruments

	Estimated Fair Value
									Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
December 31, 2012
Assets:
Mortgage and other loans receivable	$	–	$	823	$	19,396	$	20,219	$	19,348
Other invested assets		–		237		3,521		3,758		4,932
Short-term investments		–		20,752		–		20,752		20,752
Cash		1,151		–		–		1,151		1,151
Liabilities:
Policyholder contract deposits associated with investment-type contracts		–		245		123,860		124,105		105,979
Other liabilities		–		2,205		818		3,023		3,024
Long-term debt*		–		43,966		1,925		45,891		40,445
December 31, 2011
Assets:
Mortgage and other loans receivable							$	20,494	$	19,382
Other invested assets								3,390		4,701
Short-term investments								16,657		16,659
Cash								1,474		1,474
Liabilities:
Policyholder contract deposits associated with investment-type contracts								122,125		106,950
Other liabilities								896		896
Long-term debt								61,295		64,487

* Excludes Long-term debt of ILFC reclassed to Liabilities held for sale on the Consolidated Balance Sheet.