INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2020

Investments [Line Items]

Amortized cost or cost and fair value of available for sale securities

		Amortized		Allowance		Gross		Gross
		Cost or		for Credit		Unrealized		Unrealized		Fair
(in millions)		Cost		Losses(a)		Gains		Losses		Value
June 30, 2020
Bonds available for sale:
U.S. government and government sponsored entities	$	3,940	$	-	$	878	$	(16)	$	4,802
Obligations of states, municipalities and political subdivisions		13,934		-		2,082		(20)		15,996
Non-U.S. governments		13,757		(17)		971		(103)		14,608
Corporate debt		142,616		(145)		15,872		(1,578)		156,765
Mortgage-backed, asset-backed and collateralized:
RMBS		30,453		(36)		2,846		(151)		33,112
CMBS		14,294		-		841		(136)		14,999
CDO/ABS		18,351		-		296		(424)		18,223
Total mortgage-backed, asset-backed and collateralized		63,098		(36)		3,983		(711)		66,334
Total bonds available for sale(c)	$	237,345	$	(198)	$	23,786	$	(2,428)	$	258,505
										Other-Than-
		Amortized		Gross		Gross				Temporary
		Cost or		Unrealized		Unrealized		Fair		Impairments
(in millions)		Cost		Gains		Losses		Value		in AOCI(b)
December 31, 2019
Bonds available for sale:
U.S. government and government sponsored entities	$	5,108	$	316	$	(44)	$	5,380	$	-
Obligations of states, municipalities and political subdivisions		13,960		1,390		(32)		15,318		-
Non-U.S. governments		14,042		884		(57)		14,869		(18)
Corporate debt		138,046		12,090		(500)		149,636		7
Mortgage-backed, asset-backed and collateralized:
RMBS		29,802		3,067		(64)		32,805		1,149
CMBS		13,879		576		(25)		14,430		34
CDO/ABS		18,393		348		(93)		18,648		14
Total mortgage-backed, asset-backed and collateralized		62,074		3,991		(182)		65,883		1,197
Total bonds available for sale(c)	$	233,230	$	18,671	$	(815)	$	251,086	$	1,186

(a)Represents the allowance for credit losses that has been recognized. Changes in the allowance for credit losses are recorded through the statements of income and are not recognized in other comprehensive income.

(b)Represents the amount of other-than-temporary impairments recognized in Accumulated other comprehensive income (AOCI). Amount includes unrealized gains and losses on impaired securities relating to changes in the fair value of such securities subsequent to the impairment measurement date.

(c)At June 30, 2020 and December 31, 2019, bonds available for sale held by us that were below investment grade or not rated totaled $27.0 billion and $27.8 billion, respectively.

Securities available for sale in a loss position

	Less than 12 Months				12 Months or More				Total
				Gross				Gross				Gross
		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(in millions)		Value		Losses		Value		Losses		Value		Losses
June 30, 2020
Bonds available for sale:
U.S. government and government sponsored entities	$	129	$	16	$	-	$	-	$	129	$	16
Obligations of states, municipalities and political
subdivisions		337		14		112		6		449		20
Non-U.S. governments		1,649		52		207		47		1,856		99
Corporate debt		22,363		1,109		1,083		222		23,446		1,331
RMBS		3,927		77		256		26		4,183		103
CMBS		2,588		128		98		8		2,686		136
CDO/ABS		8,171		288		3,086		136		11,257		424
Total bonds available for sale	$	39,164	$	1,684	$	4,842	$	445	$	44,006	$	2,129

	Less than 12 Months				12 Months or More				Total
				Gross				Gross				Gross
		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(in millions)		Value		Losses		Value		Losses		Value		Losses
December 31, 2019
Bonds available for sale:
U.S. government and government sponsored entities	$	1,461	$	44	$	63	$	-	$	1,524	$	44
Obligations of states, municipalities and political
subdivisions		672		21		246		11		918		32
Non-U.S. governments		1,105		12		343		45		1,448		57
Corporate debt		11,868		319		2,405		181		14,273		500
RMBS		3,428		28		1,367		36		4,795		64
CMBS		1,877		16		367		9		2,244		25
CDO/ABS		3,920		53		2,571		40		6,491		93
Total bonds available for sale	$	24,331	$	493	$	7,362	$	322	$	31,693	$	815

Amortized cost and fair value of fixed maturity securities available for sale by contractual maturity

	Total Fixed Maturity Securities
	Available for Sale
		Amortized Cost,
(in millions)		Net of Allowance		Fair Value
June 30, 2020
Due in one year or less	$	10,776	$	10,903
Due after one year through five years		41,602		42,617
Due after five years through ten years		40,483		43,482
Due after ten years		81,224		95,169
Mortgage-backed, asset-backed and collateralized		63,062		66,334
Total	$	237,147	$	258,505

Gross realized gains and gross realized losses from sales or maturities of available for sale securities

	Three Months Ended June 30,								Six Months Ended June 30,
		2020				2019			2020					2019
		Gross		Gross		Gross		Gross		Gross		Gross		Gross		Gross
	Realized		Realized		Realized		Realized		Realized		Realized		Realized		Realized
(in millions)		Gains		Losses		Gains		Losses		Gains		Losses		Gains		Losses
Fixed maturity securities	$	541	$	392	$	173	$	86	$	921	$	558	$	266	$	210

Value of other securities measured at fair value based on election of the fair value option

		June 30, 2020				December 31, 2019
		Fair	Percent			Fair	Percent
(in millions)		Value	of Total			Value	of Total
Fixed maturity securities:
U.S. government and government sponsored entities	$	1,912	31	%	$	2,121	28	%
Corporate debt		11	-			18	-
Mortgage-backed, asset-backed and collateralized:
RMBS		510	9			489	7
CMBS		303	5			322	4
CDO/ABS and other collateralized		2,701	44			3,732	50
Total mortgage-backed, asset-backed and collateralized		3,514	58			4,543	61
Total fixed maturity securities		5,437	89			6,682	89
Equity securities		679	11			841	11
Total	$	6,116	100	%	$	7,523	100	%

Carrying amounts values of other invested assets

		June 30,		December 31,
(in millions)		2020		2019
Alternative investments(a) (b)	$	7,987	$	8,845
Investment real estate(c)		8,164		8,491
All other investments(d)		1,541		1,456
Total	$	17,692	$	18,792

(a)At June 30, 2020, included hedge funds of $2.2 billion, private equity funds of $5.5 billion and affordable housing partnerships of $279 million. At December 31, 2019, included hedge funds of $3.3 billion, private equity funds of $5.2 billion and affordable housing partnerships of $331 million.

(b)At June 30, 2020, approximately 77 percent of our hedge fund portfolio is available for redemption in 2020. The remaining 23 percent will be available for redemption between 2021 and 2027.

(c)Net of accumulated depreciation of $749 million and $703 million at June 30, 2020 and December 31, 2019, respectively.

(d)Includes AIG’s 3.5 percent ownership interest in Fortitude Holdings which is recorded using the measurement alternative for equity securities and is carried at cost, which was $100 million as of June 30, 2020.

Components of net investment income

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in millions)		2020		2019		2020		2019
Available for sale fixed maturity securities, including short-term investments	$	2,588	$	2,701	$	5,197	$	5,354
Other fixed maturity securities(a)		374		281		314		608
Equity securities		56		(22)		(135)		57
Interest on mortgage and other loans		498		518		1,011		1,016
Alternative investments(b)		(73)		345		(132)		764
Real estate		61		62		120		131
Other investments(c)		1		(8)		(214)		(60)
Total investment income		3,505		3,877		6,161		7,870
Investment expenses		139		132		287		246
Net investment income(d)	$	3,366	$	3,745	$	5,874	$	7,624

(a)Included in the three- and six-month periods ended June 30, 2020 were income of $29 million and $198 million, respectively, related to fixed maturity securities measured at fair value that economically hedge liabilities described in (c) below. Included in the three- and six-month periods ended June 30, 2019 were income of $21 million and $49 million, respectively, for fixed maturity securities measured at fair value through income that economically hedge liabilities as described in (c) below.

(b)Included income from hedge funds, private equity funds and affordable housing partnerships. Hedge funds are recorded as of the balance sheet date. Private equity funds are generally reported on a one-quarter lag.

(c)Included in the three- and six-month periods ended June 30, 2020 were losses of $13 million and $215 million, respectively, related to liabilities measured at fair value that are economically hedged with fixed maturity securities as described in (a) above. Included in the three- and six-month periods ended June 30, 2019 were losses of $31 million and $46 million, respectively, related to liabilities measured at fair value that are economically hedged with fixed maturity securities as described in (a) above.

(d)Included in both the three- and six-month periods ended June 30, 2020 was $116 million of Net investment income from Fortitude Re funds withheld assets. For additional information on the Fortitude Re transaction, see Note 7 to the Condensed Consolidated Financial Statements

Components of net realized capital gains (losses)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in millions)		2020		2019		2020		2019
Sales of fixed maturity securities	$	27	$	87	$	241	$	56
Other-than-temporary impairments		-		(30)		-		(113)
Change in intent(a)		(3)		-		(3)		-
Change in allowance for credit losses on fixed maturity securities(b)		(24)		-		(222)		-
Change in allowance for credit losses on loans(b)		(22)		14		(60)		(10)
Foreign exchange transactions		44		(2)		(210)		(39)
Variable annuity embedded derivatives, net of related hedges		(1,010)		(40)		1,182		(301)
All other derivatives and hedge accounting		(568)		207		991		135
Fortitude Re funds withheld assets(b)		(741)		-		(741)		-
Other		(35)		168		9		230
Net realized capital gains (losses)	$	(2,332)	$	404	$	1,187	$	(42)

(a)For the three- and six-month periods ended June 30, 2019, the change in intent was included in Other-than-temporary impairments.

(b)The change in allowance for credit losses on fixed maturity securities excludes increases in the allowance of $5 million for the three- and six-month periods ended June 30, 2020, and the change in allowance for credit losses on loans excludes decreases in the allowance of $3 million for the three- and six-month periods ended June 30, 2020, which are reported in the Fortitude Re funds withheld assets line as these changes in the allowance relate to Fortitude Re funds withheld assets. For additional information on the Fortitude Re transaction, see Note 7 to the Condensed Consolidated Financial Statements.

Schedule of increase (decrease) in unrealized appreciation (depreciation) of available for sale securities and other investments

The following table presents the increase (decrease) in unrealized appreciation (depreciation) of our available for sale securities and other investments:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in millions)		2020		2019		2020		2019
Increase (decrease) in unrealized appreciation (depreciation) of investments:
Fixed maturity securities	$	13,957	$	5,906	$	3,502	$	11,888
Other investments		-		1		-		(68)
Total increase (decrease) in unrealized appreciation (depreciation) of investments	$	13,957	$	5,907	$	3,502	$	11,820

The following table summarizes the unrealized gains and losses recognized in Net Investment Income during the reporting period on equity securities still held at the reporting date:

Three Months Ended June 30,	2020						2019
				Other						Other
			Invested						Invested
(in millions)		Equities		Assets		Total		Equities		Assets		Total
Net gains and losses recognized during the period on equity securities	$	56	$	(71)	$	(15)	$	(22)	$	271	$	249
Less: Net gains and losses recognized during the period on equity
securities sold during the period		5		13		18		(7)		146		139
Unrealized gains and losses recognized during the reporting
period on equity securities still held at the reporting date	$	51	$	(84)	$	(33)	$	(15)	$	125	$	110
Six Months Ended June 30,	2020						2019
				Other						Other
			Invested						Invested
(in millions)		Equities		Assets		Total		Equities		Assets		Total
Net gains and losses recognized during the period on equity securities	$	(135)	$	(200)	$	(335)	$	57	$	510	$	567
Less: Net gains and losses recognized during the period on equity
securities sold during the period		17		15		32		12		156		168
Unrealized gains and losses recognized during the reporting
period on equity securities still held at the reporting date	$	(152)	$	(215)	$	(367)	$	45	$	354	$	399

Rollforward of changes in allowance for credit losses on available for sale fixed maturity securities by major ivnvestment category

	Three Months Ended June 30, 2020						Six Months Ended June 30, 2020
				Non-						Non-
(in millions)	Structured		Structured			Total	Structured		Structured			Total
Balance, beginning of period*	$	37	$	174	$	211	$	7	$	-	$	7
Additions:
Securities for which allowance for credit losses were not
previously recorded		11		82		93		35		256		291
Purchases of available for sale debt securities accounted for
as purchased credit deteriorated assets		20		-		20		26		-		26
Accretion of available for sale debt securities accounted for
as purchased credit deteriorated assets		1		-		1		1		-		1
Reductions:
Securities sold during the period		(1)		(5)		(6)		(1)		(5)		(6)
Intent to sell security or more likely than not will be required to
sell the security before recovery of its amortized cost basis		-		-		-		-		-		-
Additional net increases or decreases to the allowance for
credit losses on securities that had an allowance recorded
in a previous period, for which there was no intent to sell
before recovery amortized cost basis		(31)		(33)		(64)		(31)		(33)		(64)
Write-offs charged against the allowance		-		(57)		(57)		-		(57)		(57)
Recoveries of amounts previously written off		-		-		-		-		-		-
Other		-		-		-		-		-		-
Balance, end of period	$	37	$	161	$	198	$	37	$	161	$	198

* The beginning balance incorporates the Day 1 gross up on PCD assets held as of January 1, 2020.

The following table presents a rollforward of the cumulative credit losses in other-than-temporary impairments recognized in earnings for available for sale fixed maturity securities:

Rollforward of the cumulative credit losses in other-than-temporary impairments recognized in earnings

	Three Months Ended		Six Months Ended
(in millions)	June 30, 2019		June 30, 2019
Balance, beginning of period	$	53	$	-
Increases due to:
Credit impairments on new securities subject to impairment losses		27		95
Additional credit impairments on previously impaired securities		-		6
Reductions due to:
Credit impaired securities fully disposed for which there was no
prior intent or requirement to sell		(38)		(59)
Accretion on securities previously impaired due to credit*		(8)		(8)
Balance, end of period	$	34	$	34

Represents both accretion recognized due to changes in cash flows expected to be collected over the remaining expected term of the credit impaired securities and the accretion due to the passage of time.

Reconciliation of purchase price to unpaid principal balance of securities purchased with credit deterioration

(in millions)	June 30, 2020
Unpaid principal balance	$	644
Allowance for expected credit losses at acquisition		(26)
Purchase (discount) premium		(149)
Purchase price	$	469

Schedule of purchased credit impaired (PCI) securities, at acquisition date

(in millions)	At Date of Acquisition
Contractually required payments (principal and interest)	$	35,139
Cash flows expected to be collected*		28,720
Recorded investment in acquired securities		19,382

*Represents undiscounted expected cash flows, including both principal and interest.

Schedule of purchased credit impaired (PCI) securities, at reporting date

(in millions)	December 31, 2019
Outstanding principal balance	$	10,476
Amortized cost		6,970
Fair value		8,664

Activity for accretable yield on purchased credit Impaired (PCI) securities

The following table presents activity for the accretable yield on PCI securities:

	Three Months Ended		Six Months Ended
(in millions)	June 30, 2019		June 30, 2019
Balance, beginning of period	$	6,801		$	7,210
Newly purchased PCI securities		1			13
Accretion		(151)			(323)
Effect of changes in interest rate indices		(266)			(400)
Net reclassification from (to) non-accretable difference,
including effects of prepayments		17			(98)
Balance, end of period	$	6,402		$	6,402

Schedule of fair value of securities pledged to counterparties under secured financing transactions

(in millions)		June 30, 2020		December 31, 2019
Fixed maturity securities available for sale	$	3,019	$	3,030

Schedule of fair value of securities pledged under repurchase agreements by collateral type and by remaining contractual maturity

	Remaining Contractual Maturity of the Agreements
(in millions)	Overnight and Continuous			up to 30 days		31 - 90 days		91 - 364 days		365 days or greater		Total
June 30, 2020
Bonds available for sale:
Non-U.S. governments	$	9	$	16	$	-	$	-	$	-	$	25
Corporate debt		57		110		-		-		-		167
Total	$	66	$	126	$	-	$	-	$	-	$	192
December 31, 2019
Bonds available for sale:
Non-U.S. governments	$	2	$	71	$	-	$	-	$	-	$	73
Corporate debt		22		55		82		-		-		159
Total	$	24	$	126	$	82	$	-	$	-	$	232

	Remaining Contractual Maturity of the Agreements
(in millions)		Overnight and Continuous		up to 30 days		31 - 90 days		91 - 364 days		365 days or greater		Total
June 30, 2020
Bonds available for sale:
Obligations of states, municipalities and political
subdivisions	$	-	$	102	$	-	$	-	$	-	$	102
Corporate debt		-		814		1,102		436		-		2,352
RMBS		-		277		-		96		-		373
Total	$	-	$	1,193	$	1,102	$	532	$	-	$	2,827
December 31, 2019
Bonds available for sale:
Obligations of states, municipalities and political
subdivisions	$	-	$	-	$	386	$	-	$	-	$	386
Corporate debt		-		1,071		947		-		-		2,018
RMBS		-		-		-		394		-		394
Total	$	-	$	1,071	$	1,333	$	394	$	-	$	2,798

Schedule of fair value of securities pledged to the entity under reverse repurchase agreements

(in millions)		June 30, 2020		December 31, 2019
Securities collateral pledged to us	$	5,560	$	2,567
Amount sold or repledged by us		-		121