Investments of Insurance Subsidiaries

6 Months Ended

Jun. 30, 2017

Investments, Debt and Equity Securities [Abstract]

Investments of Insurance Subsidiaries

NOTE 5 — INVESTMENTS OF INSURANCE SUBSIDIARIES

A summary of our insurance subsidiaries’ investments at June 30, 2017 and December 31, 2016 follows (dollars in millions):

	June 30, 2017
	Amortized Cost		Unrealized Amounts				Fair Value
			Gains		Losses
Debt securities:
States and municipalities	$	364		$14		$—	$	378
Money market funds		20		—		—		20
		384		14		—		398
Equity securities		1		2		—		3
	$	385		$16		$—		401
Amounts classified as current assets								(49	)
Investment carrying value							$	352

	December 31, 2016
	Amortized Cost		Unrealized Amounts				Fair Value
			Gains		Losses
Debt securities:
States and municipalities	$	345		$9		$(1)	$	353
Money market funds		28		—		—		28
		373		9		(1)		381
Equity securities		1		3		—		4
	$	374		$12		$(1)		385
Amounts classified as current assets								(49	)
Investment carrying value							$	336

At June 30, 2017 and December 31, 2016, the investments of our insurance subsidiaries were classified as “available-for-sale.” Changes in temporary unrealized gains and losses are recorded as adjustments to other comprehensive income (loss).

Scheduled maturities of investments in debt securities at June 30, 2017 were as follows (dollars in millions):

	Amortized Cost		Fair Value
Due in one year or less	$	96	$	96
Due after one year through five years		71		74
Due after five years through ten years		174		184
Due after ten years		43		44
	$	384	$	398

The average expected maturity of the investments in debt securities at June 30, 2017 was 3.9 years, compared to the average scheduled maturity of 5.5 years. Expected and scheduled maturities may differ because the issuers of certain securities have the right to call, prepay or otherwise redeem such obligations prior to their scheduled maturity date.