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Investments (Tables)
 12 Months Ended
Dec. 31, 2018
Investments [Abstract]  
Schedule for fixed income securities at amortized cost, gross unrealized gains and losses and fair value
Amortized cost, gross unrealized gains (losses) and fair value for fixed income securities
 
 
Amortized
cost
 
Gross unrealized
 
Fair
value
($ in millions)
 
 
Gains
 
Losses
 
December 31, 2018
 
 
 
 
 
 
 
 
U.S. government and agencies
 
$
5,386

 
$
137

 
$
(6
)
 
$
5,517

Municipal
 
8,963

 
249

 
(43
)
 
9,169

Corporate
 
40,536

 
490

 
(890
)
 
40,136

Foreign government
 
739

 
13

 
(5
)
 
747

ABS
 
1,049

 
6

 
(10
)
 
1,045

RMBS
 
377

 
89

 
(2
)
 
464

CMBS
 
63

 
8

 
(1
)
 
70

Redeemable preferred stock
 
21

 
1

 
—

 
22

Total fixed income securities
 
$
57,134

 
$
993

 
$
(957
)
 
$
57,170

 
 
 
 
 
 
 
 
 
December 31, 2017
 
 
 
 
 
 
 
 
U.S. government and agencies
 
$
3,580

 
$
56

 
$
(20
)
 
$
3,616

Municipal
 
8,053

 
311

 
(36
)
 
8,328

Corporate
 
42,996

 
1,234

 
(204
)
 
44,026

Foreign government
 
1,005

 
27

 
(11
)
 
1,021

ABS
 
1,266

 
13

 
(7
)
 
1,272

RMBS
 
480

 
101

 
(3
)
 
578

CMBS
 
124

 
6

 
(2
)
 
128

Redeemable preferred stock
 
21

 
2

 
—

 
23

Total fixed income securities
 
$
57,525

 
$
1,750

 
$
(283
)
 
$
58,992
Schedule for fixed income securities based on contractual maturities

Scheduled maturities for fixed income securities
 
 
As of December 31, 2018
($ in millions)
 
Amortized
cost
 
Fair
value
Due in one year or less
 
$
3,344

 
$
3,348

Due after one year through five years
 
27,862

 
27,742

Due after five years through ten years
 
17,033

 
16,773

Due after ten years
 
7,406

 
7,728

 
 
55,645

 
55,591

ABS, RMBS and CMBS
 
1,489

 
1,579

Total
 
$
57,134

 
$
57,170
Schedule of net investment income
Net investment income
 
 
For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
Fixed income securities
 
$
2,077

 
$
2,078

 
$
2,060

Equity securities
 
170

 
174

 
137

Mortgage loans
 
217

 
206

 
217

Limited partnership interests (1)(2)
 
705

 
889

 
561

Short-term investments
 
73

 
30

 
16

Other
 
272

 
236

 
222

Investment income, before expense
 
3,514

 
3,613

 
3,213

Investment expense
 
(274
)
 
(212
)
 
(171
)
Net investment income
 
$
3,240

 
$
3,401

 
$
3,042


(1) 
Due to the adoption of the recognition and measurement accounting standard, limited partnerships previously reported using the cost method are now reported at fair value with changes in fair value recognized in net investment income.
(2) 
Includes net investment income of $451 million for EMA limited partnership interests and $254 million for limited partnership interests carried at fair value for 2018.
Schedule of realized capital gains and losses by asset type
Realized capital gains (losses) by asset type
 
 
For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
Fixed income securities
 
$
(237
)
 
$
94

 
$
(91
)
Equity securities
 
(594
)
 
255

 
23

Mortgage loans
 
2

 
1

 
—

Limited partnership interests
 
(101
)
 
132

 
(21
)
Derivatives
 
46

 
(46
)
 
3

Other
 
7

 
9

 
(4
)
Realized capital gains and losses
 
$
(877
)
 
$
445

 
$
(90
)
Schedule of realized capital gains and losses by transaction type

Realized capital gains (losses) by transaction type
 
 
For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
Impairment write-downs (1)
 
$
(14
)
 
$
(102
)
 
$
(234
)
Change in intent write-downs (1)
 
—

 
(48
)
 
(69
)
Net OTTI losses recognized in earnings
 
(14
)
 
(150
)
 
(303
)
Sales (1)
 
(215
)
 
641

 
213

Valuation of equity investments (1) (2)
 
(691
)
 
—

 
—

Valuation and settlements of derivative instruments
 
43

 
(46
)
 
—

Realized capital gains and losses
 
$
(877
)
 
$
445

 
$
(90
)

(1) 
Due to the adoption of the recognition and measurement accounting standard, equity securities are reported at fair value with changes in fair value recognized in valuation of equity investments and are no longer included in impairment write-downs, change in intent write-downs and sales.
(2) 
Includes valuation of equity securities and certain limited partnership interests where the underlying assets are predominately public equity securities.
Realized gain (loss) on investments
Net appreciation (decline) recognized in net income
 
 
For the year ended
($ in millions)
 
December 31, 2018
Equity securities
 
$
(261
)
Limited partnership interests carried at fair value
 
249

Total
 
$
(12
)
Schedule of other-than-temporary impairment losses by asset type
OTTI losses by asset type
 
 
 For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
 
 
Gross
 
Included in OCI
 
Net
 
Gross
 
Included in OCI
 
Net
 
Gross
 
Included in OCI
 
Net
Fixed income securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal
 
$
—

 
$
—

 
$
—

 
$
(1
)
 
$
(3
)
 
$
(4
)
 
$
—

 
$
—

 
$
—

Corporate
 
(4
)
 
2

 
(2
)
 
(9
)
 
3

 
(6
)
 
(33
)
 
9

 
(24
)
ABS
 
(1
)
 
(2
)
 
(3
)
 
(1
)
 
(2
)
 
(3
)
 
(6
)
 
—

 
(6
)
RMBS
 
(1
)
 
—

 
(1
)
 
(2
)
 
(3
)
 
(5
)
 
—

 
(1
)
 
(1
)
CMBS
 
(3
)
 
(1
)
 
(4
)
 
(9
)
 
1

 
(8
)
 
(15
)
 
2

 
(13
)
Total fixed income securities
 
(9
)
 
(1
)
 
(10
)
 
(22
)
 
(4
)
 
(26
)
 
(54
)
 
10

 
(44
)
Equity securities (1)
 
—

 
—

 
—

 
(86
)
 
—

 
(86
)
 
(194
)
 
—

 
(194
)
Mortgage loans
 
—

 
—

 
—

 
(1
)
 
—

 
(1
)
 
—

 
—

 
—

Limited partnership interests (1)
 
(3
)
 
—

 
(3
)
 
(32
)
 
—

 
(32
)
 
(56
)
 
—

 
(56
)
Other
 
(1
)
 
—

 
(1
)
 
(5
)
 
—

 
(5
)
 
(9
)
 
—

 
(9
)
OTTI losses
 
$
(13
)

$
(1
)

$
(14
)

$
(146
)

$
(4
)

$
(150
)

$
(313
)

$
10


$
(303
)

(1) 
Due to the adoption of the recognition and measurement accounting standard, equity securities and limited partnerships previously reported using the cost method are now reported at fair value with changes in fair value recognized in net income and are no longer included in the table above.
Schedule of other-than-temporary impairment losses on fixed income securities included in Accumulated Other Comprehensive Income
OTTI losses included in AOCI at the time of impairment for fixed income securities which were not included in earnings
($ in millions)
 
December 31,
2018
 
December 31,
2017
Municipal
 
$
(5
)
 
$
(5
)
Corporate
 
(2
)
 
—

ABS
 
(10
)
 
(15
)
RMBS
 
(67
)
 
(77
)
CMBS
 
(2
)
 
(4
)
Total
 
$
(86
)
 
$
(101
)
Schedule of credit losses on fixed income securities recognized in earnings
Rollforward of the cumulative credit losses recognized in earnings for fixed income securities held
 
 
As of December 31,
($ in millions)
 
2018
 
2017
 
2016
Beginning balance
 
$
(226
)
 
$
(318
)
 
$
(392
)
Additional credit loss for securities previously other-than-temporarily impaired
 
(7
)
 
(18
)
 
(21
)
Additional credit loss for securities not previously other-than-temporarily impaired
 
(3
)
 
(8
)
 
(23
)
Reduction in credit loss for securities disposed or collected
 
30

 
116

 
117

Change in credit loss due to accretion of increase in cash flows
 
2

 
2

 
1

Ending balance
 
$
(204
)

$
(226
)

$
(318
)
Schedule of unrealized net capital gains and losses
Unrealized net capital gains and losses included in AOCI
($ in millions)
 
Fair
value
 
Gross unrealized
 
Unrealized net gains (losses)
December 31, 2018
 
 
Gains
 
Losses
 
Fixed income securities
 
$
57,170

 
$
993

 
$
(957
)
 
$
36

Short-term investments
 
3,027

 
—

 
—

 
—

Derivative instruments
 
—

 
—

 
(3
)
 
(3
)
EMA limited partnerships (1)
 
 
 
 
 
 
 
—

Unrealized net capital gains and losses, pre-tax
 
 
 
 
 
 
 
33

Amounts recognized for:
 
 
 
 
 
 
 
 
Insurance reserves (2)
 
 
 
 
 
 
 
—

DAC and DSI (3)
 
 
 
 
 
 
 
(33
)
Amounts recognized
 
 
 
 
 
 
 
(33
)
Deferred income taxes
 
 
 
 
 
 
 
(2
)
Unrealized net capital gains and losses, after-tax
 
 
 
 
 
 
 
$
(2
)
(1) 
Unrealized net capital gains and losses for limited partnership interests represent the Company’s share of EMA limited partnerships’ OCI. Fair value and gross unrealized gains and losses are not applicable.
(2) 
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 lower interest rates, resulting in a premium deficiency. This adjustment primarily relates to structured settlement annuities with life contingencies (a type of immediate fixed annuities).
(3) 
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.
Unrealized net capital gains and losses included in AOCI
($ in millions)
 
Fair
value
 
Gross unrealized
 
Unrealized net gains (losses)
December 31, 2017
 
 
Gains
 
Losses
 
Fixed income securities
 
$
58,992

 
$
1,750

 
$
(283
)
 
$
1,467

Equity securities
 
6,621

 
1,172

 
(12
)
 
1,160

Short-term investments
 
1,944

 
—

 
—

 
—

Derivative instruments (1)
 
2

 
2

 
(3
)
 
(1
)
EMA limited partnerships
 
 
 
 
 
 
 
1

Unrealized net capital gains and losses, pre-tax
 
 
 
 
 
 
 
2,627

Amounts recognized for:
 
 
 
 
 
 
 
 
Insurance reserves
 
 
 
 
 
 
 
(315
)
DAC and DSI
 
 
 
 
 
 
 
(196
)
Amounts recognized
 
 
 
 
 
 
 
(511
)
Deferred income taxes
 
 
 
 
 
 
 
(454
)
Unrealized net capital gains and losses, after-tax
 
 
 
 
 
 
 
$
1,662

(1) 
Included in the fair value of derivative instruments is $2 million classified as liabilities.
Change in unrealized net capital gains (losses)
 
 
 For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
Fixed income securities
 
$
(1,431
)
 
$
204

 
$
516

Equity securities (1)
 
—

 
651

 
233

Derivative instruments
 
(2
)
 
(3
)
 
(4
)
EMA limited partnerships
 
(1
)
 
5

 
—

Total
 
(1,434
)
 
857

 
745

Amounts recognized for:
 
 
 
 
 
 
Insurance reserves
 
315

 
(315
)
 
—

DAC and DSI
 
163

 
(50
)
 
(79
)
Amounts recognized
 
478

 
(365
)
 
(79
)
Deferred income taxes
 
202

 
117

 
(233
)
(Decrease) increase in unrealized net capital gains and losses, after-tax
 
$
(754
)

$
609


$
433
Schedule of change in unrealized net capital gains and losses
Change in unrealized net capital gains (losses)
 
 
 For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
Fixed income securities
 
$
(1,431
)
 
$
204

 
$
516

Equity securities (1)
 
—

 
651

 
233

Derivative instruments
 
(2
)
 
(3
)
 
(4
)
EMA limited partnerships
 
(1
)
 
5

 
—

Total
 
(1,434
)
 
857

 
745

Amounts recognized for:
 
 
 
 
 
 
Insurance reserves
 
315

 
(315
)
 
—

DAC and DSI
 
163

 
(50
)
 
(79
)
Amounts recognized
 
478

 
(365
)
 
(79
)
Deferred income taxes
 
202

 
117

 
(233
)
(Decrease) increase in unrealized net capital gains and losses, after-tax
 
$
(754
)

$
609


$
433


(1) 
Upon adoption of the recognition and measurement accounting standard on January 1, 2018, $1.16 billion of pre-tax unrealized net capital gains for equity securities were reclassified from AOCI to retained income. See Note 2 for further details.
Schedule of gross unrealized losses and fair value of available for sale securities by length of time
Gross unrealized losses and fair value by type and length of time held in a continuous unrealized loss position
($ 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, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed income securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
 
11

 
$
55

 
$
—

 
38

 
$
364

 
$
(6
)
 
$
(6
)
Municipal
 
943

 
1,633

 
(10
)
 
1,147

 
1,554

 
(33
)
 
(43
)
Corporate
 
1,735

 
19,243

 
(543
)
 
645

 
8,374

 
(347
)
 
(890
)
Foreign government
 
7

 
20

 
(1
)
 
27

 
412

 
(4
)
 
(5
)
ABS
 
64

 
454

 
(5
)
 
28

 
161

 
(5
)
 
(10
)
RMBS
 
166

 
30

 
—

 
195

 
52

 
(2
)
 
(2
)
CMBS
 
3

 
7

 
—

 
2

 
—

 
(1
)
 
(1
)
Redeemable preferred stock
 
1

 
—

 
—

 
—

 
—

 
—

 
—

Total fixed income securities
 
2,930

 
$
21,442

 
$
(559
)
 
2,082

 
$
10,917

 
$
(398
)
 
$
(957
)
Investment grade fixed income securities
 
2,348

 
$
17,485

 
$
(331
)
 
2,021

 
$
10,626

 
$
(360
)
 
$
(691
)
Below investment grade fixed income securities
 
582

 
3,957

 
(228
)
 
61

 
291

 
(38
)
 
(266
)
Total fixed income securities
 
2,930

 
$
21,442

 
$
(559
)
 
2,082

 
$
10,917

 
$
(398
)
 
$
(957
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed income securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
 
66

 
$
2,829

 
$
(18
)
 
18

 
$
182

 
$
(2
)
 
$
(20
)
Municipal
 
1,756

 
3,143

 
(24
)
 
165

 
349

 
(12
)
 
(36
)
Corporate
 
781

 
11,616

 
(102
)
 
208

 
3,289

 
(102
)
 
(204
)
Foreign government
 
45

 
580

 
(10
)
 
5

 
44

 
(1
)
 
(11
)
ABS
 
57

 
476

 
(3
)
 
9

 
34

 
(4
)
 
(7
)
RMBS
 
118

 
35

 
(1
)
 
181

 
50

 
(2
)
 
(3
)
CMBS
 
2

 
1

 
—

 
6

 
23

 
(2
)
 
(2
)
Redeemable preferred stock
 
1

 
—

 
—

 
—

 
—

 
—

 
—

Total fixed income securities
 
2,826


18,680


(158
)

592


3,971


(125
)

(283
)
Equity securities
 
127

 
369

 
(12
)
 
2

 
—

 
—

 
(12
)
Total fixed income and equity securities
 
2,953


$
19,049


$
(170
)

594


$
3,971


$
(125
)

$
(295
)
Investment grade fixed income securities
 
2,706

 
$
17,668

 
$
(134
)
 
535

 
$
3,751

 
$
(98
)
 
$
(232
)
Below investment grade fixed income securities
 
120

 
1,012

 
(24
)
 
57

 
220

 
(27
)
 
(51
)
Total fixed income securities
 
2,826


$
18,680


$
(158
)

592


$
3,971


$
(125
)

$
(283
)
Principal geographic distribution of commercial real estate represented in the mortgage portfolio
Principal geographic distribution of commercial real estate exceeding 5% of the mortgage loans portfolio
 
 
As of December 31,
(% of mortgage loan portfolio carrying value)
 
2018
 
2017
California
 
16.4
%
 
19.9
%
Texas
 
14.9

 
13.0

Illinois
 
7.8

 
7.1

New Jersey
 
6.8

 
7.6

Florida
 
6.1

 
6.4

North Carolina
 
5.1

 
4.0
Types of property collateralizing the mortgage loans
Types of properties collateralizing the mortgage loan portfolio
 
 
As of December 31,
(% of mortgage loan portfolio carrying value)
 
2018
 
2017
Apartment complex
 
34.4
%
 
30.9
%
Office buildings
 
24.5

 
23.8

Warehouse
 
15.8

 
15.7

Retail
 
14.4

 
18.0

Other
 
10.9

 
11.6

Total
 
100.0
%
 
100.0
%
Contractual maturities of the commercial mortgage loan portfolio

Contractual maturities of the mortgage loan portfolio
 
 
As of December 31, 2018
($ in millions)
 
Number of loans
 
Carrying value
 
Percent
2019
 
8

 
$
171

 
3.7
%
2020
 
13

 
119

 
2.6

2021
 
41

 
566

 
12.1

2022
 
32

 
553

 
11.8

Thereafter
 
189

 
3,261

 
69.8

Total
 
283

 
$
4,670

 
100.0
%
Carrying value of non-impaired fixed and variable rate mortgage loans by debt service coverage ratio distribution
Carrying value of non-impaired mortgage loans summarized by debt service coverage ratio distribution
 
 
As of December 31,
($ in millions)
 
2018
 
2017
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
 
$
6

 
$
31

 
$
37

 
$
3

 
$
—

 
$
3

1.0 - 1.25
 
273

 
—

 
273

 
345

 
—

 
345

1.26 - 1.50
 
1,192

 
—

 
1,192

 
1,141

 
30

 
1,171

Above 1.50
 
3,063

 
101

 
3,164

 
2,949

 
62

 
3,011

Total non-impaired mortgage loans
 
$
4,534

 
$
132

 
$
4,666

 
$
4,438

 
$
92

 
$
4,530
Net carrying value of impaired mortgage loans
Net carrying value of impaired mortgage loans
 
 
As of December 31,
($ in millions)
 
2018
 
2017
Impaired mortgage loans with a valuation allowance
 
$
4

 
$
4

Impaired mortgage loans without a valuation allowance
 
—

 
—

Total impaired mortgage loans
 
$
4

 
$
4

Valuation allowance on impaired mortgage loans
 
$
3

 
$
3
Valuation allowance on impaired mortgage loans
Rollforward of the valuation allowance on impaired mortgage loans
 
 
 For the years ended December 31,
($ in millions)
 
2018
 
2017
 
2016
Beginning balance
 
$
3

 
$
3

 
$
3

Net increase in valuation allowance
 
—

 
1

 
—

Charge offs
 
—

 
(1
)
 
—

Ending balance
 
$
3

 
$
3

 
$
3
Principal geographic distribution of municipal bond
Principal geographic distribution of municipal bond issuers exceeding 5% of the portfolio
 
 
As of December 31,
(% of municipal bond portfolio carrying value)
 
2018
 
2017
Texas
 
12.3
%
 
9.6
%
California
 
7.4

 
7.0

Washington
 
6.2

 
5.4

New York
 
5.6

 
6.9

Florida
 
4.9

 
6.5
Schedule of other investments, by type
Other investments by asset type
($ in millions)
 
December 31, 2018
 
December 31, 2017
Bank loans
 
$
1,350

 
$
1,702

Policy loans
 
891

 
905

Real estate
 
791

 
632

Agent loans
 
620

 
538

Derivatives and other
 
200

 
195

Total
 
$
3,852

 
$
3,972