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Investments (Tables)
 12 Months Ended
Dec. 31, 2015
Investments [Abstract]  
Schedule for fixed income securities at amortized cost, gross unrealized gains and losses and fair value
The amortized cost, gross unrealized gains and losses and fair value for fixed income securities are as follows:
 
 
 
Gross unrealized
 
 
($ in millions)
Amortized
cost
 
Gains
 
Losses
 
Fair
value
December 31, 2015
 
 
 
 
 
 
 
U.S. government and agencies
$
3,836

 
$
90

 
$
(4
)
 
$
3,922

Municipal
7,032

 
389

 
(20
)
 
7,401

Corporate
41,674

 
1,032

 
(879
)
 
41,827

Foreign government
983

 
50

 
—

 
1,033

ABS
2,359

 
11

 
(43
)
 
2,327

RMBS
857

 
100

 
(10
)
 
947

CMBS
438

 
32

 
(4
)
 
466

Redeemable preferred stock
22

 
3

 
—

 
25

Total fixed income securities
$
57,201

 
$
1,707

 
$
(960
)
 
$
57,948

 
 
 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
 
 
U.S. government and agencies
$
4,192

 
$
139

 
$
(3
)
 
$
4,328

Municipal
7,877

 
645

 
(25
)
 
8,497

Corporate
40,386

 
1,998

 
(240
)
 
42,144

Foreign government
1,543

 
102

 
—

 
1,645

ABS
3,971

 
38

 
(31
)
 
3,978

RMBS
1,108

 
112

 
(13
)
 
1,207

CMBS
573

 
44

 
(2
)
 
615

Redeemable preferred stock
22

 
4

 
—

 
26

Total fixed income securities
$
59,672

 
$
3,082

 
$
(314
)
 
$
62,440
Schedule for fixed income securities based on contractual maturities
The scheduled maturities for fixed income securities are as follows as of December 31, 2015:
($ in millions)
Amortized
cost
 
Fair
value
Due in one year or less
$
4,030

 
$
4,050

Due after one year through five years
26,999

 
27,337

Due after five years through ten years
16,885

 
16,778

Due after ten years
5,633

 
6,043

 
53,547

 
54,208

ABS, RMBS and CMBS
3,654

 
3,740

Total
$
57,201

 
$
57,948
Schedule of net investment income
Net investment income for the years ended December 31 is as follows:
($ in millions)
2015
 
2014
 
2013
Fixed income securities
$
2,218

 
$
2,447

 
$
2,921

Equity securities
110

 
117

 
149

Mortgage loans
228

 
265

 
372

Limited partnership interests
549

 
614

 
541

Short-term investments
9

 
7

 
5

Other
192

 
170

 
161

Investment income, before expense
3,306

 
3,620

 
4,149

Investment expense
(150
)
 
(161
)
 
(206
)
Net investment income
$
3,156

 
$
3,459

 
$
3,943
Schedule of realized capital gains and losses by asset type
Realized capital gains and losses by asset type for the years ended December 31 are as follows:
($ in millions)
2015
 
2014
 
2013
Fixed income securities
$
212

 
$
130

 
$
262

Equity securities
(50
)
 
582

 
327

Mortgage loans
6

 
2

 
20

Limited partnership interests
(93
)
 
13

 
(5
)
Derivatives
(21
)
 
(38
)
 
(10
)
Other
(24
)
 
5

 
—

Realized capital gains and losses
$
30

 
$
694

 
$
594
Schedule of realized capital gains and losses by transaction type
Realized capital gains and losses by transaction type for the years ended December 31 are as follows:
($ in millions)
2015
 
2014
 
2013
Impairment write-downs
$
(195
)
 
$
(32
)
 
$
(72
)
Change in intent write-downs
(221
)
 
(213
)
 
(143
)
Net other-than-temporary impairment losses recognized in earnings
(416
)
 
(245
)
 
(215
)
Sales and other
470

 
975

 
819

Valuation and settlements of derivative instruments
(24
)
 
(36
)
 
(10
)
Realized capital gains and losses
$
30

 
$
694

 
$
594
Schedule of other-than-temporary impairment losses by asset type
Other-than-temporary impairment losses by asset type for the years ended December 31 are as follows:
($ in millions)
2015
 
2014
 
2013
 
Gross
 
Included in OCI
 
Net
 
Gross
 
Included in OCI
 
Net
 
Gross
 
Included in OCI
 
Net
Fixed income securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal
$
(17
)
 
$
4

 
$
(13
)
 
$
(10
)
 
$
—

 
$
(10
)
 
$
(24
)
 
$
(5
)
 
$
(29
)
Corporate
(61
)
 
11

 
(50
)
 
(7
)
 
—

 
(7
)
 
—

 
—

 
—

ABS
(33
)
 
22

 
(11
)
 
(12
)
 
1

 
(11
)
 
—

 
(2
)
 
(2
)
RMBS
1

 
(1
)
 
—

 
6

 
(4
)
 
2

 
(3
)
 
2

 
(1
)
CMBS
(1
)
 
—

 
(1
)
 
(1
)
 
—

 
(1
)
 
(32
)
 
(3
)
 
(35
)
Total fixed income securities
(111
)
 
36

 
(75
)
 
(24
)
 
(3
)
 
(27
)
 
(59
)
 
(8
)
 
(67
)
Equity securities
(279
)
 
—

 
(279
)
 
(196
)
 
—

 
(196
)
 
(137
)
 
—

 
(137
)
Mortgage loans
4

 
—

 
4

 
5

 
—

 
5

 
11

 
—

 
11

Limited partnership interests
(51
)
 
—

 
(51
)
 
(27
)
 
—

 
(27
)
 
(18
)
 
—

 
(18
)
Other
(15
)
 
—

 
(15
)
 
—

 
—

 
—

 
(4
)
 
—

 
(4
)
Other-than-temporary impairment losses
$
(452
)

$
36


$
(416
)

$
(242
)

$
(3
)

$
(245
)

$
(207
)

$
(8
)

$
(215
)
Schedule of other-than-temporary impairment losses on fixed income securities included in Accumulated Other Comprehensive Income
The total amount of other-than-temporary impairment losses included in accumulated other comprehensive income at the time of impairment for fixed income securities, which were not included in earnings, are presented in the following table. The amount excludes $233 million as of both December 31, 2015 and 2014, respectively, of net unrealized gains related to changes in valuation of the fixed income securities subsequent to the impairment measurement date.
($ in millions)
December 31,
2015
 
December 31,
2014
Municipal
$
(9
)
 
$
(8
)
Corporate
(7
)
 
—

ABS
(23
)
 
(2
)
RMBS
(102
)
 
(108
)
CMBS
(6
)
 
(5
)
Total
$
(147
)
 
$
(123
)
Schedule of credit losses on fixed income securities recognized in earnings
Rollforwards of the cumulative credit losses recognized in earnings for fixed income securities held as of December 31 are as follows:
($ in millions)
2015
 
2014
 
2013
Beginning balance
$
(380
)
 
$
(513
)
 
$
(617
)
Additional credit loss for securities previously other-than-temporarily impaired
(30
)
 
(6
)
 
(30
)
Additional credit loss for securities not previously other-than-temporarily impaired
(45
)
 
(18
)
 
(19
)
Reduction in credit loss for securities disposed or collected
60

 
95

 
150

Reduction in credit loss for securities the Company has made the decision to sell or more likely than not will be required to sell
—

 
—

 
2

Change in credit loss due to accretion of increase in cash flows
3

 
3

 
1

Reduction in credit loss for securities sold in LBL disposition
—

 
59

 
—

Ending balance
$
(392
)

$
(380
)

$
(513
)
Schedule of unrealized net capital gains and losses
Unrealized net capital gains and losses included in accumulated other comprehensive income are as follows:
 
 
 
Gross unrealized
 
 
($ in millions)
Fair
value
 
Gains
 
Losses
 
Unrealized net gains (losses)
December 31, 2015
 
 
 
Fixed income securities
$
57,948

 
$
1,707

 
$
(960
)
 
$
747

Equity securities
5,082

 
415

 
(139
)
 
276

Short-term investments
2,122

 
—

 
—

 
—

Derivative instruments (1)
10

 
10

 
(4
)
 
6

EMA limited partnerships (2)
 
 
 
 
 
 
(4
)
Unrealized net capital gains and losses, pre-tax
 
 
 
 
 
 
1,025

Amounts recognized for:
 
 
 
 
 
 
 
Insurance reserves (3)
 
 
 
 
 
 
—

DAC and DSI (4)
 
 
 
 
 
 
(67
)
Amounts recognized
 
 
 
 
 
 
(67
)
Deferred income taxes
 
 
 
 
 
 
(338
)
Unrealized net capital gains and losses, after-tax
 
 
 
 
 
 
$
620

______________________________
(1) 
Included in the fair value of derivative instruments are $6 million classified as assets and $(4) million classified as liabilities.
(2) 
Unrealized net capital gains and losses for limited partnership interests represent the Company’s share of EMA limited partnerships’ other comprehensive income. Fair value and gross unrealized gains and losses are not applicable.
(3) 
The insurance reserves adjustment represents the amount by which the reserve balance would increase if the net unrealized gains in the applicable product portfolios were realized and reinvested at current lower interest rates, resulting in a premium deficiency. Although the Company evaluates premium deficiencies on the combined performance of life insurance and immediate annuities with life contingencies, the adjustment primarily relates to structured settlement annuities with life contingencies, in addition to annuity buy-outs and certain payout annuities with life contingencies.
(4) 
The DAC and DSI adjustment balance represents the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized gains or losses in the respective product portfolios were realized.
 
 
 
Gross unrealized
 
 
($ in millions)
Fair
value
 
Gains
 
Losses
 
Unrealized net gains (losses)
December 31, 2014
 
 
 
Fixed income securities
$
62,440

 
$
3,082

 
$
(314
)
 
$
2,768

Equity securities
4,104

 
467

 
(55
)
 
412

Short-term investments
2,540

 
—

 
—

 
—

Derivative instruments (1)
2

 
3

 
(5
)
 
(2
)
EMA limited partnerships
 
 
 
 
 
 
(5
)
Unrealized net capital gains and losses, pre-tax
 
 
 
 
 
 
3,173

Amounts recognized for:
 
 
 
 
 
 
 
Insurance reserves
 
 
 
 
 
 
(28
)
DAC and DSI
 
 
 
 
 
 
(179
)
Amounts recognized
 
 
 
 
 
 
(207
)
Deferred income taxes
 
 
 
 
 
 
(1,040
)
Unrealized net capital gains and losses, after-tax
 
 
 
 
 
 
$
1,926

______________________________
(1) 
Included in the fair value of derivative instruments are $3 million classified as assets and $1 million classified as liabilities.
Schedule of change in unrealized net capital gains and losses
The change in unrealized net capital gains and losses for the years ended December 31 is as follows:
($ in millions)
2015
 
2014
 
2013
Fixed income securities
$
(2,021
)
 
$
866

 
$
(3,200
)
Equity securities
(136
)
 
(212
)
 
164

Derivative instruments
8

 
16

 
4

EMA limited partnerships
1

 
(2
)
 
(10
)
Investments classified as held for sale
—

 
(190
)
 
190

Total
(2,148
)
 
478

 
(2,852
)
Amounts recognized for:
 
 
 
 
 
Insurance reserves
28

 
(28
)
 
771

DAC and DSI
112

 
(21
)
 
254

Amounts recognized
140

 
(49
)
 
1,025

Deferred income taxes
702

 
(149
)
 
639

(Decrease) increase in unrealized net capital gains and losses, after-tax
$
(1,306
)

$
280


$
(1,188
)
Schedule of gross unrealized losses and fair value of available for sale securities by length of time
The following table summarizes the gross unrealized losses and fair value of fixed income and equity securities by the length of time that individual securities have been in a continuous unrealized loss position.
($ in millions)
Less than 12 months
 
12 months or more
 
 
 
Number of issues
 
Fair value
 
Unrealized losses
 
Number of issues
 
Fair value
 
Unrealized losses
 
Total unrealized losses
December 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed income securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
53

 
$
1,874

 
$
(4
)
 
—

 
$
—

 
$
—

 
$
(4
)
Municipal
222

 
810

 
(6
)
 
9

 
36

 
(14
)
 
(20
)
Corporate
1,361

 
17,915

 
(696
)
 
111

 
1,024

 
(183
)
 
(879
)
Foreign government
9

 
44

 
—

 
—

 
—

 
—

 
—

ABS
133

 
1,733

 
(24
)
 
20

 
324

 
(19
)
 
(43
)
RMBS
88

 
69

 
—

 
176

 
125

 
(10
)
 
(10
)
CMBS
13

 
75

 
(2
)
 
1

 
2

 
(2
)
 
(4
)
Total fixed income securities
1,879

 
22,520

 
(732
)
 
317

 
1,511

 
(228
)
 
(960
)
Equity securities
265

 
1,397

 
(107
)
 
37

 
143

 
(32
)
 
(139
)
Total fixed income and equity securities
2,144

 
$
23,917

 
$
(839
)
 
354

 
$
1,654

 
$
(260
)
 
$
(1,099
)
Investment grade fixed income securities
1,405

 
$
17,521

 
$
(362
)
 
225

 
$
972

 
$
(105
)
 
$
(467
)
Below investment grade fixed income securities
474

 
4,999

 
(370
)
 
92

 
539

 
(123
)
 
(493
)
Total fixed income securities
1,879

 
$
22,520

 
$
(732
)
 
317

 
$
1,511

 
$
(228
)
 
$
(960
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed income securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
21

 
$
1,501

 
$
(3
)
 
—

 
$
—

 
$
—

 
$
(3
)
Municipal
252

 
1,008

 
(9
)
 
19

 
116

 
(16
)
 
(25
)
Corporate
576

 
7,545

 
(147
)
 
119

 
1,214

 
(93
)
 
(240
)
Foreign government
2

 
13

 
—

 
1

 
19

 
—

 
—

ABS
81

 
1,738

 
(11
)
 
26

 
315

 
(20
)
 
(31
)
RMBS
75

 
70

 
(1
)
 
188

 
156

 
(12
)
 
(13
)
CMBS
8

 
33

 
—

 
3

 
32

 
(2
)
 
(2
)
Total fixed income securities
1,015


11,908


(171
)

356


1,852


(143
)

(314
)
Equity securities
258

 
866

 
(53
)
 
1

 
11

 
(2
)
 
(55
)
Total fixed income and equity securities
1,273


$
12,774


$
(224
)

357


$
1,863


$
(145
)

$
(369
)
Investment grade fixed income securities
754

 
$
9,951

 
$
(71
)
 
281

 
$
1,444

 
$
(87
)
 
$
(158
)
Below investment grade fixed income securities
261

 
1,957

 
(100
)
 
75

 
408

 
(56
)
 
(156
)
Total fixed income securities
1,015


$
11,908


$
(171
)

356


$
1,852


$
(143
)

$
(314
)
Principal geographic distribution of commercial real estate represented in the mortgage portfolio
The following table shows the principal geographic distribution of commercial real estate represented in the Company’s mortgage loan portfolio. No other state represented more than 5% of the portfolio as of December 31.
(% of mortgage loan portfolio carrying value)
2015
 
2014
California
21.3
%
 
23.9
%
Texas
9.7

 
8.0

New Jersey
8.7

 
8.0

Illinois
7.1

 
9.4

Florida
5.3

 
5.0

New York
4.4

 
5.9
Types of property collateralizing the mortgage loans
The types of properties collateralizing the mortgage loans as of December 31 are as follows:
(% of mortgage loan portfolio carrying value)
2015
 
2014
Apartment complex
26.4
%
 
23.3
%
Office buildings
22.7

 
24.3

Retail
21.3

 
22.2

Warehouse
18.4

 
17.8

Other
11.2

 
12.4

Total
100.0
%
 
100.0
%
Contractual maturities of the commercial mortgage loan portfolio
The contractual maturities of the mortgage loan portfolio as of December 31, 2015 are as follows:
($ in millions)
Number of loans
 
Carrying value
 
Percent
2016
31

 
$
289

 
6.7
%
2017
34

 
379

 
8.7

2018
33

 
392

 
9.0

2019
9

 
234

 
5.4

Thereafter
210

 
3,044

 
70.2

Total
317

 
$
4,338

 
100.0
%
Carrying value of non-impaired fixed and variable rate mortgage loans by debt service coverage ratio distribution
The following table reflects the carrying value of non-impaired fixed rate and variable rate mortgage loans summarized by debt service coverage ratio distribution as of December 31:
($ in millions)
2015
 
2014
Debt service coverage ratio distribution
Fixed rate mortgage loans
 
Variable rate mortgage loans
 
Total
 
Fixed rate mortgage loans
 
Variable rate mortgage loans
 
Total
Below 1.0
$
64

 
$
—

 
$
64

 
$
110

 
$
—

 
$
110

1.0 - 1.25
382

 
—

 
382

 
424

 
—

 
424

1.26 - 1.50
1,219

 
—

 
1,219

 
1,167

 
1

 
1,168

Above 1.50
2,667

 
—

 
2,667

 
2,450

 
20

 
2,470

Total non-impaired mortgage loans
$
4,332

 
$
—

 
$
4,332

 
$
4,151

 
$
21

 
$
4,172
Net carrying value of impaired mortgage loans
The net carrying value of impaired mortgage loans as of December 31 is as follows:
($ in millions)
2015
 
2014
Impaired mortgage loans with a valuation allowance
$
6

 
$
16

Impaired mortgage loans without a valuation allowance
—

 
—

Total impaired mortgage loans
$
6

 
$
16

Valuation allowance on impaired mortgage loans
$
3

 
$
8
Valuation allowance on impaired mortgage loans
The rollforward of the valuation allowance on impaired mortgage loans for the years ended December 31 is as follows:
($ in millions)
2015
 
2014
 
2013
Beginning balance
$
8

 
$
21

 
$
42

Net decrease in valuation allowance
(4
)
 
(5
)
 
(11
)
Charge offs
(1
)
 
(8
)
 
(8
)
Mortgage loans classified as held for sale
—

 
—

 
(2
)
Ending balance
$
3

 
$
8

 
$
21
Principal geographic distribution of municipal bond
The following table shows the principal geographic distribution of municipal bond issuers represented in the Company’s portfolio as of December 31. No other state represents more than 5% of the portfolio.
(% of municipal bond portfolio carrying value)
2015
 
2014
Texas
9.2
%
 
9.1
%
New York
7.7

 
6.7

California
6.3

 
9.1

Florida
5.6

 
5.9

Washington
5.6

 
4.2