Investments (Tables)

12 Months Ended

Dec. 31, 2022

Investments, Debt and Equity Securities [Abstract]

Net Investment Income

Net investment income is as follows:

Year Ended December 31	2022		2021		2020
(In millions)
Fixed maturity securities	$	1,787	$	1,707	$	1,728
Limited partnership investments	(6)		375		127
Short term investments	17		2		10
Equity securities (a)	23		83		65
Income from trading portfolio (a)			106		83
Other	65		61		58
Total investment income	1,886		2,334		2,071
Investment expenses	(84)		(75)		(76)
Net investment income	$	1,802	$	2,259	$	1,995
(a) Net investment income recognized due to the change in fair value of equity and trading portfolio securities held as of December 31, 2022, 2021 and 2020	$	3	$	23	$	88

Investment Gains (Losses)

Investment gains (losses) are as follows:

Year Ended December 31	2022		2021		2020
(In millions)
Fixed maturity securities:
Gross gains	$	120	$	186	$	220
Gross losses	(261)		(90)		(220)
Investment gains (losses) on fixed maturity securities	(141)		96		—
Equity securities (a)	(116)		4		(3)
Derivative instruments	64		6		(10)
Short term investments and other	(6)		14		(22)
Altium Packaging (see Note 2)			555
Diamond Offshore (see Note 2)			(15)		(1,211)
Investment gains (losses)	$	(199)	$	660	$	(1,246)
(a) Investment gains (losses) recognized due to the change in fair value of non-redeemable preferred stock included within equity securities held as of December 31, 2022, 2021 and 2020	$	(75)	$	2	$	(3)

Available-for-Sale Impairment Losses (Gains) Recognized in Earnings

The components of available-for-sale impairment losses (gains) recognized in earnings by asset type are presented in the following table. The table includes losses (gains) on securities with an intention to sell and changes in the allowance for credit losses on securities since acquisition date:

Year Ended December 31	2022		2021		2020
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	62	$	11	$	87
Asset-backed			20		24
Impairment losses recognized in earnings	$	62	$	31	$	111

Amortized Cost and Fair Values of Fixed Maturity Securities

The amortized cost and fair values of fixed maturity securities are as follows:

December 31, 2022	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Estimated Fair Value
(In millions)
Fixed maturity securities:
Corporate and other bonds	$	23,137	$	301	$	2,009			$	21,429
States, municipalities and political  subdivisions	8,918		338		939				8,317
Asset-backed:
Residential mortgage-backed	3,073		5		447				2,631
Commercial mortgage-backed	1,886		4		255				1,635
Other asset-backed	3,287		2		361		$	1	2,927
Total asset-backed	8,246		11		1,063		1		7,193
U.S. Treasury and obligations of  government sponsored enterprises	111		1		2				110
Foreign government	617		1		43				575
Redeemable preferred stock	3								3
Fixed maturities available-for-sale	41,032		652		4,056		1		37,627
Fixed maturities trading	70								70
Total fixed maturity securities	$	41,102	$	652	$	4,056	$	1	$	37,697

December 31, 2021
Fixed maturity securities:
Corporate and other bonds	$	21,444	$	2,755	$	56	$	11	$	24,132
States, municipalities and political  subdivisions	10,358		1,599		14				11,943
Asset-backed:
Residential mortgage-backed	2,893		71		8				2,956
Commercial mortgage-backed	1,987		63		19				2,031
Other asset-backed	2,561		54		10		7		2,598
Total asset-backed	7,441		188		37		7		7,585
U.S. Treasury and obligations of  government sponsored enterprises	132		1		3				130
Foreign government	570		15		2				583
Fixed maturities available-for-sale	39,945		4,558		112		18		44,373
Fixed maturities trading	7								7
Total fixed maturity securities	$	39,952	$	4,558	$	112	$	18	$	44,380

Available-for-sale Securities in Gross Unrealized Loss Position

The available-for-sale securities in a gross unrealized loss position for which an allowance for credit losses has not been recorded are as follows:

	Less than 12 Months				12 Months or Longer				Total
December 31, 2022	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities:
Corporate and other bonds	$	15,946	$	1,585	$	1,634	$	424	$	17,580	$	2,009
States, municipalities and political  subdivisions	4,079		769		456		170		4,535		939
Asset-backed:
Residential mortgage-backed	1,406		144		1,143		303		2,549		447
Commercial mortgage-backed	1,167		159		408		96		1,575		255
Other asset-backed	2,087		262		542		99		2,629		361
Total asset-backed	4,660		565		2,093		498		6,753		1,063
U.S. Treasury and obligations of  government-sponsored enterprises	76		1		16		1		92		2
Foreign government	473		26		78		17		551		43
Total fixed maturity securities	$	25,234	$	2,946	$	4,277	$	1,110	$	29,511	$	4,056
December 31, 2021
Fixed maturity securities:
Corporate and other bonds	$	2,389	$	48	$	136	$	8	$	2,525	$	56
States, municipalities and political  subdivisions	730		14						730		14
Asset-backed:
Residential mortgage-backed	1,043		8						1,043		8
Commercial mortgage-backed	527		7		167		12		694		19
Other asset-backed	840		10		62				902		10
Total asset-backed	2,410		25		229		12		2,639		37
U.S. Treasury and obligations of  government-sponsored enterprises	69		3		5				74		3
Foreign government	97		2						97		2
Total fixed maturity securities	$	5,695	$	92	$	370	$	20	$	6,065	$	112

The following table presents the estimated fair value and gross unrealized losses of fixed maturity securities in a gross unrealized loss position for which an allowance for credit loss has not been recorded, by ratings distribution.

	December 31, 2022				December 31, 2021
	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
U.S. Government, Government agencies and Government-sponsored enterprises	$	2,355	$	337	$	898	$	8
AAA	1,559		298		368		6
AA	4,327		817		875		17
A	6,615		749		1,516		23
BBB	13,226		1,621		1,812		42
Non-investment grade	1,429		234		596		16
Total	$	29,511	$	4,056	$	6,065	$	112

Activity of Allowance on Available-for-Sale Securities

The following tables present the activity related to the allowance on available-for-sale securities with credit impairments and PCD assets. Accrued interest receivables on available-for-sale fixed maturity securities totaled $394 million and $369 million as of December 31, 2022 and 2021 and are excluded from the estimate of expected credit losses and the amortized cost basis in the tables within this Note.

Year Ended December 31, 2022	Corporate and Other Bonds		Asset-backed		Total
(In millions)
Allowance for credit losses:
Balance as of January 1, 2022	$	11	$	7	$	18
Additions to the allowance for credit losses:
Securities for which credit losses were not previously recorded					—
Available-for-sale securities accounted for as PCD assets			3		3
Reductions to the allowance for credit losses:
Securities sold during the period (realized)					—
Write-offs charged against the allowance	12				12
Additional increases or (decreases) to the allowance for credit losses on securities that had an allowance recorded in a previous period	1		(9)		(8)
Total allowance for credit losses	$	—	$	1	$	1

Year Ended December 31, 2021	Corporate and Other Bonds		Asset-backed		Total
(In millions)
Allowance for credit losses:
Balance as of January 1, 2021	$	23	$	17	$	40
Additions to the allowance for credit losses:
Securities for which credit losses were not previously recorded	14				14
Available-for-sale securities accounted for as PCD assets	5		6		11
Reductions to the allowance for credit losses:
Securities sold during the period (realized)	7		17		24
Write-offs charged against the allowance	16				16
Additional increases or (decreases) to the allowance for credit losses on securities that had an allowance recorded in a previous period	(8)		1		(7)
Total allowance for credit losses	$	11	$	7	$	18

Available-for-sale Fixed Maturity Securities by Contractual Maturity

The following table presents available-for-sale fixed maturity securities by contractual maturity.

December 31	2022				2021
	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
(In millions)
Due in one year or less	$	1,012	$	1,001	$	1,603	$	1,624
Due after one year through five years	9,880		9,399		10,637		11,229
Due after five years through ten years	13,788		12,453		13,294		14,338
Due after ten years	16,352		14,774		14,411		17,182
Total	$	41,032	$	37,627	$	39,945	$	44,373

Amortized Cost Basis of Mortgage Loans for Each Credit Quality Indicator by Year of Origination

The following table presents the amortized cost basis of mortgage loans for each credit quality indicator by year of origination. The primary credit quality indicators utilized are debt service coverage ratios (“DSCR”) and loan-to-value (“LTV”) ratios.

	Mortgage Loans Amortized Cost Basis by Origination Year (a)
As of December 31, 2022	2022		2021		2020		2019		2018		Prior		Total
(In millions)
DSCR ≥1.6x
LTV less than 55%	$	9	$	13	$	112	$	41	$	53	$	255	$	483
LTV 55% to 65%	13												13
LTV greater than 65%	18		11										29
DSCR 1.2x - 1.6x
LTV less than 55%	5		49		18		43		10		37		162
LTV 55% to 65%	86				20						8		114
LTV greater than 65%	15												15
DSCR ≤1.2x
LTV less than 55%	35						57						92
LTV 55% to 65%	41		21				38						100
LTV greater than 65%	27						22				7		56
Total	$	249	$	94	$	150	$	201	$	63	$	307	$	1,064

(a) The values in the table above reflect DSCR on a standardized amortization period and LTV ratios based on the most recent appraised values trended forward using changes in a commercial real estate price index.

Aggregate Contractual or Notional Amounts and Estimated Fair Values Related to Derivative Financial Instruments

The following tables present the aggregate contractual or notional amount and estimated fair value related to derivative financial instruments.

December 31	2022						2021
	Contractual/Notional Amount		Estimated Fair Value				Contractual/Notional Amount		Estimated Fair Value
			Asset		(Liability)				Asset	(Liability)
(In millions)
Without hedge designation:
Equity markets:
Futures - short	$	169
Warrants	117		$	6
Interest rate swaps	240		19				$	100
Currency forwards	12				$	(1)
Embedded derivative on funds withheld liability							270			$	(12)