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Fair Value
3 Months Ended
Mar. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value Fair Value
The preparation of the Company’s unaudited condensed consolidated financial statements in accordance with GAAP requires certain assets and liabilities to be reflected at their fair value and others to be reflected on another basis, such as an adjusted historical cost basis. The Company’s assets and liabilities carried at fair value have been classified within one of three levels of a hierarchy established by GAAP. The following are the levels of the hierarchy and a brief description of the type of valuation information (“valuation inputs”) that qualifies a financial asset or liability for each level:

Level 1 – Unadjusted quoted prices for identical assets or liabilities in active markets.
Level 2 – Valuation inputs other than Level 1 that are based on observable market data.  These include: quoted prices for similar assets in active markets, quoted prices for identical assets in inactive markets, valuation inputs that are observable that are not prices (such as interest rates and credit risks) and valuation inputs that are derived from or corroborated by observable markets.
Level 3 – Developed from unobservable data, reflecting the Company’s assumptions.

For a description of the methods and assumptions that are used to estimate the fair value and determine the fair value hierarchy classification of each class of financial instrument, see Note 4 “Fair Value” in the 2021 Form 10-K.
There were no financial liabilities measured at fair value on a recurring basis on the condensed consolidated balance sheets at March 31, 2022 or December 31, 2021. Financial assets measured at fair value on a recurring basis on the condensed consolidated balance sheets at March 31, 2022 and December 31, 2021 were as follows:
In millionsLevel 1Level 2Level 3Total
March 31, 2022    
Cash and cash equivalents (1)
$4,601 $3,872 $— $8,473 
Debt securities:    
U.S. government securities2,243 43 — 2,286 
States, municipalities and political subdivisions— 2,498 — 2,498 
U.S. corporate securities— 9,912 32 9,944 
Foreign securities— 2,991 2,999 
Residential mortgage-backed securities— 867 — 867 
Commercial mortgage-backed securities— 1,225 — 1,225 
Other asset-backed securities— 2,623 30 2,653 
Redeemable preferred securities— 26 — 26 
Total debt securities2,243 20,185 70 22,498 
Equity securities149 — 60 209 
Total$6,993 $24,057 $130 $31,180 
December 31, 2021    
Cash and cash equivalents$4,954 $4,454 $— $9,408 
Debt securities:    
U.S. government securities2,372 44 — 2,416 
States, municipalities and political subdivisions— 3,086 3,091 
U.S. corporate securities— 9,697 38 9,735 
Foreign securities— 2,983 10 2,993 
Residential mortgage-backed securities— 875 — 875 
Commercial mortgage-backed securities— 1,310 — 1,310 
Other asset-backed securities— 2,789 2,792 
Redeemable preferred securities— 28 — 28 
Total debt securities2,372 20,812 56 23,240 
Equity securities114 — 55 169 
Total$7,440 $25,266 $111 $32,817 
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(1)Includes cash and cash equivalents of $31 million which were accounted for as assets held for sale in connection with the planned divestiture of the Thailand business and are included in other current assets on the unaudited condensed consolidated balance sheet at March 31, 2022.

During the three months ended March 31, 2022 there were $3 million of transfers out of Level 3. During the three months ended March 31, 2021, there were no transfers into or out of Level 3.
The carrying value and estimated fair value classified by level of fair value hierarchy for financial instruments carried on the condensed consolidated balance sheets at adjusted cost or contract value at March 31, 2022 and December 31, 2021 were as follows:
Carrying
Value
 Estimated Fair Value
In millionsLevel 1Level 2Level 3Total
March 31, 2022
Assets: 
Mortgage loans$918 $— $— $892 $892 
Equity securities (1)
126 N/AN/AN/AN/A
Liabilities:
Investment contract liabilities:
With a fixed maturity— — 
Without a fixed maturity334 — — 336 336 
Long-term debt56,280 58,624 — — 58,624 
December 31, 2021
Assets: 
Mortgage loans$902 $— $— $907 $907 
Equity securities (1)
126 N/AN/AN/AN/A
Liabilities:  
Investment contract liabilities:  
With a fixed maturity— — 
Without a fixed maturity336 — — 373 373 
Long-term debt56,176 64,157 — — 64,157 
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(1)It was not practical to estimate the fair value of these cost-method investments as it represents shares of unlisted companies.

Separate Accounts assets relate to the Company’s large case pensions products which represent funds maintained to meet specific objectives of contract holders. Since contract holders bear the investment risk of these assets, a corresponding Separate Accounts liability has been established equal to the assets. These assets and liabilities are carried at fair value. Separate Accounts financial assets as of March 31, 2022 and December 31, 2021 were as follows:
 March 31, 2022December 31, 2021
In millionsLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Cash and cash equivalents$$193 $— $196 $$186 $— $188 
Debt securities1,095 2,793 — 3,888 1,233 3,048 — 4,281 
Equity securities— — — — 
Common/collective trusts— 500 — 500 — 547 — 547 
Total (1)
$1,098 $3,487 $— $4,585 $1,235 $3,782 $— $5,017 
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(1)Excludes $85 million and $70 million of other receivables at March 31, 2022 and December 31, 2021, respectively.