Insurance Insurance

12 Months Ended

Dec. 31, 2017

Insurance [Abstract]

Insurance

4. Insurance

Insurance Liabilities

Insurance liabilities are comprised of future policy benefits, policyholder account balances and other policy-related balances. Information regarding insurance liabilities by segment, as well as Corporate & Other, was as follows at:

	December 31,
	2017		2016
	(In millions)
U.S.	$	136,065	$	129,117
Asia	99,404		89,422
Latin America	16,758		14,760
EMEA	19,579		18,075
MetLife Holdings	103,372		104,271
Corporate & Other	829		(3,121		)
Total	$	376,007	$	352,524

Future policy benefits are measured as follows:

Product Type:	Measurement Assumptions:
Participating life	Aggregate of (i) net level premium reserves for death and endowment policy benefits (calculated based upon the non-forfeiture interest rate, ranging from 3% to 7% for domestic business and less than 1% to 11% for international business and mortality rates guaranteed in calculating the cash surrender values described in such contracts); and (ii) the liability for terminal dividends for domestic business.
Nonparticipating life	Aggregate of the present value of future expected benefit payments and related expenses less the present value of future expected net premiums. Assumptions as to mortality and persistency are based upon the Company’s experience when the basis of the liability is established. Interest rate assumptions for the aggregate future policy benefit liabilities range from 2% to 11% for domestic business and less than 1% to 13% for international business.
Individual and group traditional fixed annuities after annuitization	Present value of future expected payments. Interest rate assumptions used in establishing such liabilities range from 1% to 11% for domestic business and less than 1% to 12% for international business.
Non-medical health insurance	The net level premium method and assumptions as to future morbidity, withdrawals and interest, which provide a margin for adverse deviation. Interest rate assumptions used in establishing such liabilities range from 4% to 7% (primarily related to domestic business).
Disabled lives	Present value of benefits method and experience assumptions as to claim terminations, expenses and interest. Interest rate assumptions used in establishing such liabilities range from 2% to 8% for domestic business and less than 1% to 9% for international business.
Property & casualty insurance	The amount estimated for claims that have been reported but not settled and claims incurred but not reported are based upon the Company’s historical experience and other actuarial assumptions that consider the effects of current developments, anticipated trends and risk management programs, reduced for anticipated salvage and subrogation.

Participating business represented 3% and 4% of the Company’s life insurance in-force at December 31, 2017 and 2016, respectively. Participating policies represented 15%, 16% and 17% of gross traditional life insurance premiums for the years ended December 31, 2017, 2016 and 2015, respectively.

Policyholder account balances are equal to: (i) policy account values, which consist of an accumulation of gross premium payments and investment performance; (ii) credited interest, ranging from less than 1% to 13% for domestic business and less than 1% to 12% for international business, less expenses, mortality charges and withdrawals; and (iii) fair value adjustments relating to business combinations.

Guarantees

The Company issues directly and assumes through reinsurance variable annuity products with guaranteed minimum benefits. GMABs and the portions of both non-life-contingent GMWBs and GMIBs that do not require annuitization are accounted for as embedded derivatives in policyholder account balances and are further discussed in Note 9. Guarantees accounted for as insurance liabilities include:

Guarantee:			Measurement Assumptions:
GMDBs	•	A return of purchase payment upon death even if the account value is reduced to zero.	•	Present value of expected death benefits in excess of the projected account balance recognizing the excess ratably over the accumulation period based on the present value of total expected assessments.
	•	An enhanced death benefit may be available for an additional fee.	•	Assumptions are consistent with those used for amortizing DAC, and are thus subject to the same variability and risk.
			•	Investment performance and volatility assumptions are consistent with the historical experience of the appropriate underlying equity index, such as the S&P 500 Index.
			•	Benefit assumptions are based on the average benefits payable over a range of scenarios.
GMIBs	•	After a specified period of time determined at the time of issuance of the variable annuity contract, a minimum accumulation of purchase payments, even if the account value is reduced to zero, that can be annuitized to receive a monthly income stream that is not less than a specified amount.	•	Present value of expected income benefits in excess of the projected account balance at any future date of annuitization and recognizing the excess ratably over the accumulation period based on present value of total expected assessments.
	•	Certain contracts also provide for a guaranteed lump sum return of purchase premium in lieu of the annuitization benefit.	•	Assumptions are consistent with those used for estimating GMDB liabilities.
			•	Calculation incorporates an assumption for the percentage of the potential annuitizations that may be elected by the contractholder.
GMWBs	•	A return of purchase payment via partial withdrawals, even if the account value is reduced to zero, provided that cumulative withdrawals in a contract year do not exceed a certain limit.	•	Expected value of the life contingent payments and expected assessments using assumptions consistent with those used for estimating the GMDB liabilities.
	•	Certain contracts include guaranteed withdrawals that are life contingent.

The Company also issues other annuity contracts that apply a lower rate on funds deposited if the contractholder elects to surrender the contract for cash and a higher rate if the contractholder elects to annuitize. These guarantees include benefits that are payable in the event of death, maturity or at annuitization. Certain other annuity contracts contain guaranteed annuitization benefits that may be above what would be provided by the current account value of the contract. Additionally, the Company issues universal and variable life contracts where the Company contractually guarantees to the contractholder a secondary guarantee or a guaranteed paid-up benefit.

Information regarding the liabilities for guarantees (excluding base policy liabilities and embedded derivatives) relating to annuity and universal and variable life contracts was as follows:

	Annuity Contracts						Universal and Variable Life Contracts
	GMDBs			GMIBs			Secondary Guarantees			Paid-Up Guarantees		Total
	(In millions)
Direct and Assumed:
Balance at January 1, 2015	$	307		$	463		$	2,711		$	288	$	3,769
Incurred guaranteed benefits (1)	68			62			43			18		191
Paid guaranteed benefits	(11		)	(1		)	(28		)	—		(40		)
Balance at December 31, 2015	364			524			2,726			306		3,920
Incurred guaranteed benefits (1)	102			78			291			25		496
Paid guaranteed benefits	(15		)	(1		)	(28		)	—		(44		)
Balance at December 31, 2016	451			601			2,989			331		4,372
Incurred guaranteed benefits (1)	91			121			233			16		461
Paid guaranteed benefits	(14		)	(2		)	(34		)	—		(50		)
Balance at December 31, 2017	$	528		$	720		$	3,188		$	347	$	4,783
Ceded:
Balance at January 1, 2015	$	23		$	6		$	187		$	201	$	417
Incurred guaranteed benefits	(1		)	—			31			13		43
Paid guaranteed benefits	(3		)	—			—			—		(3		)
Balance at December 31, 2015	19			6			218			214		457
Incurred guaranteed benefits	—			(1		)	(27		)	17		(11		)
Paid guaranteed benefits	5			—			—			—		5
Balance at December 31, 2016	24			5			191			231		451
Incurred guaranteed benefits	4			1			50			11		66
Paid guaranteed benefits	6			—			—			—		6
Balance at December 31, 2017	$	34		$	6		$	241		$	242	$	523
Net:
Balance at January 1, 2015	$	284		$	457		$	2,524		$	87	$	3,352
Incurred guaranteed benefits	69			62			12			5		148
Paid guaranteed benefits	(8		)	(1		)	(28		)	—		(37		)
Balance at December 31, 2015	345			518			2,508			92		3,463
Incurred guaranteed benefits	102			79			318			8		507
Paid guaranteed benefits	(20		)	(1		)	(28		)	—		(49		)
Balance at December 31, 2016	427			596			2,798			100		3,921
Incurred guaranteed benefits	87			120			183			5		395
Paid guaranteed benefits	(20		)	(2		)	(34		)	—		(56		)
Balance at December 31, 2017	$	494		$	714		$	2,947		$	105	$	4,260

__________________

(1) Secondary guarantees include the effects of foreign currency translation of $78 million, $119 million and ($80) million at December 31, 2017, 2016 and 2015, respectively.

Information regarding the Company’s guarantee exposure, which includes direct and assumed business, but excludes offsets from hedging or ceded reinsurance, if any, was as follows at:

	December 31,
	2017							2016
	In the Event of Death			At Annuitization				In the Event of Death			At Annuitization
	(Dollars in millions)
Annuity Contracts (1):
Variable Annuity Guarantees:
Total account value (2), (3)	$	66,724		$	26,223			$	66,176		$	25,335
Separate account value	$	45,431		$	24,336			$	43,359		$	23,330
Net amount at risk (2)	$	1,238	(4)	$	525	(5)		$	1,842	(4)	$	521	(5)
Average attained age of contractholders	65 years			65 years				64 years			65 years
Other Annuity Guarantees:
Total account value (3)	N/A			$	1,424			N/A			$	1,393
Net amount at risk	N/A			$	569	(6	)	N/A			$	490	(6)
Average attained age of contractholders	N/A			50 years				N/A			50 years

	December 31,
	2017				2016
	Secondary Guarantees		Paid-Up Guarantees		Secondary Guarantees		Paid-Up Guarantees
	(Dollars in millions)
Universal and Variable Life Contracts (1):
Total account value (3)	$	9,036	$	3,207	$	8,363	$	3,337
Net amount at risk (7)	$	66,956	$	16,615	$	70,225	$	17,785
Average attained age of policyholders	56 years		63 years		55 years		62 years

__________________

(1) The Company’s annuity and life contracts with guarantees may offer more than one type of guarantee in each contract. Therefore, the amounts listed above may not be mutually exclusive.

(2) Includes amounts, which are not reported on the consolidated balance sheets, from assumed variable annuity guarantees from the Company’s former operating joint venture in Japan.

(3) Includes the contractholder’s investments in the general account and separate account, if applicable.

(4) Defined as the death benefit less the total account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date and includes any additional contractual claims associated with riders purchased to assist with covering income taxes payable upon death.

(5) Defined as the amount (if any) that would be required to be added to the total account value to purchase a lifetime income stream, based on current annuity rates, equal to the minimum amount provided under the guaranteed benefit. This amount represents the Company’s potential economic exposure to such guarantees in the event all contractholders were to annuitize on the balance sheet date, even though the contracts contain terms that allow annuitization of the guaranteed amount only after the 10th anniversary of the contract, which not all contractholders have achieved.

(6) Defined as either the excess of the upper tier, adjusted for a profit margin, less the lower tier, as of the balance sheet date or the amount (if any) that would be required to be added to the total account value to purchase a lifetime income stream, based on current annuity rates, equal to the minimum amount provided under the guaranteed benefit. These amounts represent the Company’s potential economic exposure to such guarantees in the event all contractholders were to annuitize on the balance sheet date.

(7) Defined as the guarantee amount less the account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date.

Account balances of contracts with guarantees were invested in separate account asset classes as follows at:

	December 31,
	2017		2016 (1)
	(In millions)
Fund Groupings:
Equity	$	23,213	$	21,169
Balanced	20,859		20,070
Bond	5,983		5,827
Money Market	252		218
Total	$	50,307	$	47,284

__________________

(1) Account balances at December 31, 2016 decreased in total by $6.7 billion from those amounts previously reported to correct for the inclusion of contracts without guarantees.

Obligations Under Funding Agreements

The Company issues fixed and floating rate funding agreements, which are denominated in either U.S. dollars or foreign currencies, to certain unconsolidated special purpose entities (“SPEs”) that have issued either debt securities or commercial paper for which payment of interest and principal is secured by such funding agreements. During the years ended December 31, 2017, 2016 and 2015, the Company issued $42.7 billion, $39.7 billion and $35.1 billion, respectively, and repaid $41.4 billion, $38.5 billion and $35.5 billion, respectively, of such funding agreements. At December 31, 2017 and 2016, liabilities for funding agreements outstanding, which are included in policyholder account balances, were $34.2 billion and $30.8 billion, respectively.

Certain of the Company’s subsidiaries are members of regional banks in the FHLB system (“FHLBanks”). Holdings of common stock of FHLBanks, included in equity securities, were as follows at:

	December 31,
	2017		2016
	(In millions)
FHLB of New York	$	733	$	748
FHLB of Des Moines	$	35	$	35
FHLB of Pittsburgh	$	11	$	11

Such subsidiaries have also entered into funding agreements with FHLBanks and a subsidiary of the Federal Agricultural Mortgage Corporation, a federally chartered instrumentality of the U.S. (“Farmer Mac”). The liability for such funding agreements is included in policyholder account balances. Information related to such funding agreements was as follows at:

	Liability				Collateral
	December 31,
	2017		2016		2017			2016
	(In millions)
FHLB of New York (1)	$	14,445	$	14,445	$	16,605	(2)	$	16,828	(2)
Farmer Mac (3)	$	2,550	$	2,550	$	2,644		$	2,645
FHLB of Des Moines (1)	$	625	$	625	$	701	(2)	$	811	(2)
FHLB of Pittsburgh (1)	$	250	$	250	$	311	(2)	$	383	(2)

__________________

(1) Represents funding agreements issued to the applicable FHLBank in exchange for cash and for which such FHLBank has been granted a lien on certain assets, some of which are in the custody of such FHLBank, including residential mortgage-backed securities (“RMBS”), to collateralize obligations under advances evidenced by funding agreements. The applicable subsidiary of the Company is permitted to withdraw any portion of the collateral in the custody of such FHLBank as long as there is no event of default and the remaining qualified collateral is sufficient to satisfy the collateral maintenance level. Upon any event of default by such subsidiary, the applicable FHLBank’s recovery on the collateral is limited to the amount of such subsidiary’s liability to such FHLBank.

(2) Advances are collateralized by mortgage-backed securities. The amount of collateral presented is at estimated fair value.

(3) Represents funding agreements issued to a subsidiary of Farmer Mac, as well as certain SPEs that have issued debt securities for which payment of interest and principal is secured by such funding agreements, and such debt securities are also guaranteed as to payment of interest and principal by Farmer Mac. The obligations under these funding agreements are secured by a pledge of certain eligible agricultural mortgage loans and may, under certain circumstances, be secured by other qualified collateral. The amount of collateral presented is at carrying value.

Liabilities for Unpaid Claims and Claim Expenses

The following is information about incurred and paid claims development by segment as of December 31, 2017. Such amounts are presented net of reinsurance, and are not discounted. The tables present claims development and cumulative claim payments by incurral year. The development tables are only presented for significant short-duration product liabilities within each segment. Where practical, up to 10 years of history has been provided. In order to eliminate potential fluctuations related to foreign exchange rates, liabilities and payments denominated in a foreign currency have been translated using the 2017 year end spot rates for all periods presented. The information about incurred and paid claims development prior to 2016 is presented as supplementary information, as described in Note 1.

U.S.

Group Life - Term

	Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance															At December 31, 2017
	For the Years Ended December 31,															Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
	(Unaudited)
Incurral Year	2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2011	$	6,318	$	6,290	$	6,293	$	6,269	$	6,287	$	6,295	$	6,294		$	1	207,301
2012			6,503		6,579		6,569		6,546		6,568		6,569			3		208,626
2013					6,637		6,713		6,719		6,720		6,730			15		210,643
2014							6,986		6,919		6,913		6,910			5		210,797
2015									7,040		7,015		7,014			12		211,597
2016											7,125		7,085			21		206,610
2017													7,432			898		186,954
Total													48,034
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance													(46,136		)
All outstanding liabilities for incurral years prior to 2011, net of reinsurance													5
Total unpaid claims and claim adjustment expenses, net of reinsurance													$	1,903

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2011		2012		2013		2014		2015		2016		2017
	(In millions)
2011	$	4,982	$	6,194	$	6,239	$	6,256	$	6,281	$	6,290	$	6,292
2012			5,132		6,472		6,518		6,532		6,558		6,565
2013					5,216		6,614		6,664		6,678		6,711
2014							5,428		6,809		6,858		6,869
2015									5,524		6,913		6,958
2016											5,582		6,980
2017													5,761
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance													$	46,136

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		6		7
Group Life - Term	78.3	%	20.0	%	0.7	%	0.2	%	0.4	%	0.1	%	—	%

Group Long-Term Disability

	Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance															At December 31, 2017
	For the Years Ended December 31,															Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
	(Unaudited)
Incurral Year	2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2011	$	955	$	916	$	894	$	914	$	924	$	923	$	918		$	—	21,642
2012			966		979		980		1,014		1,034		1,037			—		20,085
2013					1,008		1,027		1,032		1,049		1,070			—		21,123
2014							1,076		1,077		1,079		1,101			—		22,838
2015									1,082		1,105		1,093			4		21,136
2016											1,131		1,139			26		17,585
2017													1,244			585		9,258
Total													7,602
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance													(3,006		)
All outstanding liabilities for incurral years prior to 2011, net of reinsurance													2,539
Total unpaid claims and claim adjustment expenses, net of reinsurance													$	7,135

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2011		2012		2013		2014		2015		2016		2017
	(In millions)
2011	$	44	$	217	$	337	$	411	$	478	$	537	$	588
2012			43		229		365		453		524		591
2013					43		234		382		475		551
2014							51		266		428		526
2015									50		264		427
2016											49		267
2017													56
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance													$	3,006

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		6		7
Group Long-Term Disability	4.4	%	18.8	%	13.9	%	8.5	%	7.1	%	6.4	%	5.6	%

Significant Methodologies and Assumptions

Group Life - Term and Group Long-Term Disability incurred but not paid (“IBNP”) liabilities are developed using a combination of loss ratio and development methods. Claims in the course of settlement are then subtracted from the IBNP liabilities, resulting in the IBNR liabilities. The loss ratio method is used in the period in which the claims are neither sufficient nor credible. In developing the loss ratios, any material rate increases that could change the underlying premium without affecting the estimated incurred losses are taken into account. For periods where sufficient and credible claim data exists, the development method is used based on the claim triangles which categorize claims according to both the period in which they were incurred and the period in which they were paid, adjudicated or reported. The end result is a triangle of known data that is used to develop known completion ratios and factors. Claims paid are then subtracted from the estimated ultimate incurred claims to calculate the IBNP liability.

An expense liability is held for the future expenses associated with the payment of incurred but not yet paid claims (IBNR and pending). This is expressed as a percentage of the underlying claims liability and is based on past experience and the anticipated future expense structure.

For Group Life - Term and Group Long-Term Disability, first year incurred claims and allocated loss adjustment expenses increased in 2017 compared to the 2016 incurral year due to the growth in the size of the business.

There were no significant changes in methodologies during 2017. The assumptions used in calculating the unpaid claims and claim adjustment expenses for Group Life - Term and Group Long-Term Disability are updated annually to reflect emerging trends in claim experience.

No additional premiums or return premiums have been accrued as a result of the prior year development.

Liabilities for Group Life - Term unpaid claims and claim adjustment expenses are not discounted.

The liabilities for Group Long-Term Disability unpaid claims and claim adjustment expenses were $6.0 billion and $5.8 billionat December 31, 2017 and 2016, respectively. These amounts were discounted using interest rates ranging from 3% to 8%, based on the incurral year. The total discount applied to these liabilities was $1.3 billionat both December 31, 2017 and 2016. The amount of interest accretion recognized was $510 million, $565 million and $517 million for the years ended December 31, 2017, 2016 and 2015, respectively. These amounts were reflected in policyholder benefits and claims.

For Group Life - Term, claims were based upon individual death claims. For Group Long-Term Disability, claim frequency was determined by the number of reported claims as identified by a unique claim number assigned to individual claimants. Claim counts initially include claims that do not ultimately result in a liability. These claims are omitted from the claim counts once it is determined that there is no liability.

The Group Long-Term Disability IBNR included in the development tables above was developed using discounted cash flows, and is presented on a discounted basis.

Property & Casualty - Auto Liability

	Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance																					At December 31, 2017
	For the Years Ended December 31,																					Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2008	$	818	$	839	$	828	$	805	$	799	$	794	$	793	$	791	$	790	$	791		$	—	200,517
2009			862		877		853		826		823		817		815		815		814			—		201,579
2010					863		873		853		847		833		826		825		822			1		202,098
2011							863		876		869		855		846		843		843			2		202,513
2012									882		881		869		851		846		847			3		196,928
2013											911		900		882		878		876			6		201,297
2014													897		910		913		910			12		203,560
2015															975		984		979			30		207,485
2016																	1,012		1,002			77		204,497
2017																			957			161		173,607
Total																			8,841
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			(7,672		)
All outstanding liabilities for incurral years prior to 2008, net of reinsurance																			27
Total unpaid claims and claim adjustment expenses, net of reinsurance																			$	1,196

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(In millions)
2008	$	304	$	553	$	657	$	725	$	764	$	778	$	785	$	787	$	788	$	789
2009			321		563		681		755		789		803		810		813		813
2010					319		572		695		762		796		810		816		818
2011							324		590		711		777		810		825		831
2012									333		600		715		783		815		831
2013											346		618		743		809		843
2014													352		648		777		844
2015															384		691		822
2016																	396		702
2017																			379
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			$	7,672

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		6		7		8		9		10
Auto Liability	39.3	%	31.3	%	14.0	%	7.9	%	4.0	%	1.8	%	0.9	%	0.5	%	0.1	%	0.2	%

Property & Casualty - Home

	Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance																					At December 31, 2017
	For the Years Ended December 31,																					Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2008	$	644	$	636	$	599	$	590	$	588	$	589	$	588	$	586	$	585	$	585		$	—	127,479
2009			506		523		510		507		503		501		498		497		497			—		106,616
2010					573		589		587		584		582		581		580		579			—		115,510
2011							891		868		843		840		835		835		834			—		166,455
2012									714		713		703		698		696		694			2		146,536
2013											654		652		635		635		634			4		107,525
2014													707		702		704		705			7		113,604
2015															759		753		752			12		107,073
2016																	740		743			20		106,537
2017																			747			66		106,915
Total																			6,770
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			(6,545		)
All outstanding liabilities for incurral years prior to 2008, net of reinsurance																			1
Total unpaid claims and claim adjustment expenses, net of reinsurance																			$	226

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(In millions)
2008	$	446	$	558	$	574	$	579	$	582	$	583	$	584	$	584	$	584	$	584
2009			385		476		486		492		495		495		496		496		496
2010					436		546		562		571		574		577		578		578
2011							690		804		819		825		827		830		832
2012									559		668		681		687		689		690
2013											505		604		618		626		628
2014													574		670		685		692
2015															603		717		731
2016																	593		704
2017																			610
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			$	6,545

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		$	6		7		8		9		10
Home	80.5	%	14.8	%	2.3	%	1.0	%	0.6	%	0.3		%	0.2	%	0.1	%	—	%	0.1	%

Significant Methodologies and Assumptions

The liability for unpaid claim and claim adjustment expenses for the Property & Casualty business is determined by examining the historical claims and allocated claim adjustment expenses data. This data, which is gross of salvage and subrogation, is classified by incurral year and coverage and includes paid claims data and reported liabilities. For homeowners and auto liability injury claims, the reported liabilities are set by the Company’s claims adjusters based on the individual case, and a supplemental liability is added based on the historical development of reported claims. These supplemental liabilities are estimated by coverage based on adjusted report year data triangles developed to estimate ultimate claim liability. Adjustments are made for settlement rates and average case liabilities. For auto non-injury claims, the Company holds an average statistical liability for every reported claim. This statistical liability is based on an estimated average payment that varies by coverage, report year and state. These average estimated payments are updated monthly.

For all property and casualty coverages, many actuarial methods such as adjusted loss development (adjusted for settlement rates and average case liabilities) and loss ratio methods are employed to develop a best estimate of the IBNR for each coverage type. Similar actuarial methods are used to determine the best estimate of the expected salvage and subrogation; methods that look at recoveries by age and ratios of recoveries to paid loss are compared for each coverage. A liability for unpaid allocated claim adjustment expenses is held for the future claim adjustment costs associated with the payment of incurred but not yet paid claims. This liability is calculated as a percentage of the underlying unpaid claims liability. The percentage is based on historical ratios of essential claim department expenses compared with paid losses.

There were no significant changes in methodologies or assumptions during 2017.

No additional premiums or return premiums have been accrued as a result of the prior year development.

Liabilities for unpaid claims and claim adjustment expenses were not discounted.

The cumulative number of reported claims for auto liability coverages are counted by individual coverages (i.e. bodily injury and property damage) and, if multiple occupants are injured, then each injury is counted as a separate claim. For home coverages, each exposure is counted separately, so a house fire would, for example, have separate claim counts for the building, the contents, and additional living expenses. Claim counts include claims that do not ultimately result in a liability. Any liability established upon receipt of these claims would subsequently be reversed.

Asia

Group Disability & Group Life

			Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance															At December 31, 2017
			For the Years Ended December 31,															Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
			(Unaudited)
Incurral Year	2010		2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2010	$	82	$	78	$	84	$	107	$	107	$	103	$	135	$	144		$	24	2,490
2011			64		67		88		88		94		124		132			24		2,629
2012					98		104		103		118		119		122			10		3,962
2013							148		150		174		168		167			19		4,448
2014									297		279		256		256			54		5,020
2015											280		267		271			78		4,473
2016													234		238			102		2,314
2017															303			215		1,456
Total															1,633
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance															(1,108		)
All outstanding liabilities for incurral years prior to 2010, net of reinsurance															27
Total unpaid claims and claim adjustment expenses, net of reinsurance															$	552

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2010		2011		2012		2013		2014		2015		2016		2017
	(In millions)
2010	$	20	$	40	$	53	$	65	$	79	$	89	$	114	$	121
2011			13		40		54		67		81		102		109
2012					30		65		85		99		106		112
2013							44		99		121		136		149
2014									69		144		180		202
2015											81		154		192
2016													66		135
2017															88
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance															$	1,108

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		6		7		8
Group Disability & Group Life	23.6	%	25.8	%	13.0	%	9.3	%	8.6	%	8.9	%	11.3	%	5.5	%

Significant Methodologies and Assumptions

This business line consists of employer sponsored and industry sponsored Group Life and Group Disability risks.

For Group Life, the IBNR liability is determined by using the Bornhuetter-Ferguson Method, with factors derived by examining the experience of historical claims. A pending liability is also calculated for claims that have been reported but have not been paid. A claim eligibility ratio based on past experience is applied to the face amount of individual claims.

For Group Disability, the IBNR liability is calculated by applying a percentage to premiums in-force based on the expected delay as evidenced by the experience in the portfolio. This is then allocated back into different incurral years based on an assumed run-off. A claims in course of payment liability is also calculated for claims that have been admitted and are in the course of payment. The assumptions employed are based on economic conditions and industry experience, as adjusted for the Company’s own experience.

An expense liability is held for the future expenses associated with the payment of incurred but not yet paid claims. This is expressed as a percentage of the underlying claims liability and is based on past experience and the future expense structure.

There were no significant changes in methodologies or assumptions during 2017.

No additional premiums or return premiums have been accrued as a result of the prior year development.

The liabilities for unpaid claims and claim adjustment expenses were $756 million and $627 million at December 31, 2017 and 2016, respectively. These amounts were discounted using interest rates ranging from 3% to 7%, based on the incurral year. The total discount applied to these liabilities was $57 million and $42 million at December 31, 2017 and 2016, respectively. The amount of interest accretion recognized was $26 million, $22 million and $20 million for the years ended December 31, 2017, 2016 and 2015, respectively. These amounts were reflected in policyholder benefits and claims.

The Company tracks claim frequency by the number of reported claims as identified by a unique claim number assigned to individual claimants. Claim counts include claims that do not ultimately result in a liability. A liability is only established for those claims that are expected to result in a liability, based on historical factors.

Latin America

Protection Life

	Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance																					At December 31, 2017
	For the Years Ended December 31,																					Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2008	$	208	$	277	$	281	$	282	$	283	$	283	$	283	$	283	$	283	$	284		$	—	31,642
2009			236		319		324		325		325		325		326		326		327			—		31,322
2010					259		333		340		341		342		342		342		343			—		33,386
2011							150		229		236		237		238		238		235			—		28,103
2012									159		215		221		222		223		221			—		29,244
2013											176		246		253		254		253			—		33,170
2014													252		381		392		361			1		41,566
2015															330		470		440			2		47,111
2016																	359		456			14		40,972
2017																			372			117		25,103
Total																			3,292
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			(3,024		)
All outstanding liabilities for incurral years prior to 2008, net of reinsurance																			12
Total unpaid claims and claim adjustment expenses, net of reinsurance																			$	280

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(In millions)
2008	$	205	$	271	$	276	$	277	$	277	$	277	$	277	$	278	$	278	$	281
2009			234		311		316		317		317		317		317		317		321
2010					239		311		318		319		319		319		320		322
2011							147		225		231		232		232		232		234
2012									157		212		217		218		219		219
2013											172		238		243		244		244
2014													226		336		342		346
2015															271		379		404
2016																	245		437
2017																			216
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			$	3,024

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		6		7		8		9		10
Protection Life	65.1	%	27.8	%	2.3	%	0.5	%	0.1	%	—	%	0.2	%	0.2	%	0.6	%	1.3	%

Protection Health

	Incurred Claims and Allocated Claim Adjustment Expense, Net of Reinsurance																					At December 31, 2017
	For the Years Ended December 31,																					Total IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(Dollars in millions)
2008	$	133	$	149	$	151	$	151	$	151	$	152	$	152	$	152	$	152	$	154		$	—	89,217
2009			153		171		173		173		174		174		174		174		177			—		92,530
2010					180		201		202		203		204		204		204		207			—		96,276
2011							216		240		242		243		243		243		240			—		105,965
2012									209		235		237		237		238		236			—		99,498
2013											226		255		257		258		255			1		103,110
2014													235		261		263		261			2		96,260
2015															202		229		231			3		84,678
2016																	265		305			7		101,478
2017																			383			48		101,116
Total																			2,449
Cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			(2,365		)
All outstanding liabilities for incurral years prior to 2008, net of reinsurance																			3
Total unpaid claims and claim adjustment expenses, net of reinsurance																			$	87

	Cumulative Paid Claims and Paid Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,
	(Unaudited)
Incurral Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017
	(In millions)
2008	$	133	$	149	$	151	$	151	$	151	$	152	$	152	$	152	$	152	$	154
2009			153		171		173		173		174		174		174		174		177
2010					180		201		202		203		203		204		204		207
2011							216		240		242		243		243		243		240
2012									209		235		237		237		238		236
2013											226		255		257		258		255
2014													233		259		262		258
2015															202		229		228
2016																	249		298
2017																			312
Total cumulative paid claims and paid allocated claim adjustment expenses, net of reinsurance																			$	2,365

Average Annual Percentage Payout

The following is supplementary information about average historical claims duration as of December 31, 2017:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
Years	1		2		3		4		5		6		7	8		9		10
Protection Health	86.7	%	11.2	%	0.6	%	0.1	%	—	%	—	%	(0.3)%	0.5	%	0.8	%	1.4	%

Significant Methodologies and Assumptions

The Latin America segment establishes liabilities for unpaid losses, which are equal to the accumulation of unpaid reported claims, plus an estimate for claims incurred but not reported.

In general terms, for both the Protection Life and Protection Health products, the methodology for IBNR is a weighted loss ratio combined with the Bornhuetter-Ferguson Method. The factors are derived by examining the experience of historical claims. In the initial months, the credibility is higher on premiums and lower on claims. As the premiums are earned, the credibility grows for the factors. For one major medical Protection Health product, a different methodology is employed, which estimates the IBNR based on a percentage of policy cancellations and the accrued premium.

For Protection Health products, claim duration can be very long due to the multiple incidences over time that may occur for a single claim. The number of claims reported per year is based on the original claim occurrence date for each individual claim. Any subsequent claims that are considered part of the original claim occurrence are not counted as a new claim. For Protection Life products, claims are based upon individual death claims.

During 2017, there was an increase in first year incurred claims and allocated loss adjustment expenses as compared to 2016 due to an increase in claims duration experience for one product and due to an overall increase in sales of certain plan sponsored and individual protection health products.

There were no significant changes in methodologies or assumptions during 2017.

No additional premiums or return premiums have been accrued as a result of the prior year development.

Liabilities for unpaid claims and claim adjustment expenses were not discounted.

For Protection Life and Protection Health products, claim counts initially include claims that do not ultimately result in a liability. These claims are omitted from the claim counts once it is determined that there is no liability.

Reconciliation of the Disclosure of Incurred and Paid Claims Development to the Liability for Unpaid Claims and Claim Adjustment Expenses

The reconciliation of the net incurred and paid claims development tables to the liability for unpaid claims and claims adjustment expenses on the consolidated balance sheet was as follows at:

	December 31, 2017
	(In millions)
Short-Duration:
Unpaid claims and allocated claims adjustment expenses, net of reinsurance:
U.S.:
Group Life - Term	$	1,903
Group Long-Term Disability	7,135
Property & Casualty - Auto	1,196
Property & Casualty - Home	226
Total			$	10,460
Asia - Group Disability & Group Life			552
Latin America:
Protection Life	280
Protection Health	87
Total			367
Other insurance lines - all segments combined			970
Total unpaid claims and allocated claims adjustment expenses, net of reinsurance			12,349
Reinsurance recoverables on unpaid claims:
U.S.:
Group Life - Term	16
Group Long-Term Disability	95
Property & Casualty - Auto	73
Property & Casualty - Home	5
Total			189
Asia - Group Disability & Group Life			261
Latin America:
Protection Life	4
Protection Health	4
Total			8
Other insurance lines - all segments combined			203
Total reinsurance recoverable on unpaid claims			661
Total unpaid claims and allocated claims adjustment expense			13,010
Unallocated claims adjustment expenses			107
Discounting			(1,328		)
Liability for unpaid claims and claim adjustment liabilities - short-duration			11,789
Liability for unpaid claims and claim adjustment liabilities - all long-duration lines			5,305
Total liability for unpaid claims and claim adjustment expense (included in future policy benefits and other policy-related balances)			$	17,094

Rollforward of Claims and Claim Adjustment Expenses

Information regarding the liabilities for unpaid claims and claim adjustment expenses was as follows:

	Years Ended December 31,
	2017			2016 (1)			2015 (2)
	(In millions)
Balance at December 31 of prior period	$	16,157		$	9,669		$	9,525
Less: Reinsurance recoverables	1,968			476			454
Net balance at December 31 of prior period	14,189			9,193			9,071
Cumulative adjustment (3)	—			4,819			—
Net balance at January 1,	14,189			14,012			9,071
Incurred related to:
Current year	24,370			24,011			9,533
Prior years (4)	133			382			(78		)
Total incurred	24,503			24,393			9,455
Paid related to:
Current year	(18,525		)	(18,696		)	(6,759		)
Prior years	(5,271		)	(5,520		)	(2,574		)
Total paid	(23,796		)	(24,216		)	(9,333		)
Net balance at December 31,	14,896			14,189			9,193
Add: Reinsurance recoverables	2,198			1,968			476
Balance at December 31,	$	17,094		$	16,157		$	9,669

__________________

(1) In addition to the revisions discussed in Note 1, at December 31, 2016, the Net balance decreased by $736 million and the Reinsurance recoverables increased by $742 million from those amounts previously reported primarily to correct for the improper classification of reinsurance recoverables.

(2) Limited to property & casualty, group accident and non-medical health policies and contracts.

(3) Reflects the accumulated adjustment, net of reinsurance, upon implementation of the new short-duration contracts guidance which clarified the requirement to include claim information for long-duration contracts. The accumulated adjustment primarily reflects unpaid claim liabilities, net of reinsurance, for long-duration contracts as of the beginning of the period presented. Prior periods have not been restated. See Note 1.

(4) During 2017, as a result of changes in estimates of insured events in the respective prior year, claims and claim adjustment expenses associated with prior years increased due to events incurred in prior years but reported during current year. During 2016, as a result of changes in estimates of insured events in the respective prior year, claims and claim adjustment expenses associated with prior years increased due to the implementation of new guidance related to short-duration contracts. During 2015, as a result of changes in estimates of insured events in the respective prior year, claims and claim adjustment expenses associated with prior years decreased due to a reduction in prior year automobile bodily injury and homeowners’ severity.

Separate Accounts

Separate account assets and liabilities include two categories of account types: pass-through separate accounts totaling $148.2 billion and $134.5 billion at December 31, 2017 and 2016, respectively, for which the policyholder assumes all investment risk, and separate accounts for which the Company contractually guarantees either a minimum return or account value to the policyholder which totaled $56.8 billion and $61.1 billion at December 31, 2017 and 2016, respectively. The latter category consisted primarily of guaranteed interest contracts. The average interest rate credited on these contracts was 2.34% and 2.35% at December 31, 2017 and 2016, respectively.

For the years ended December 31, 2017, 2016 and 2015, there were no investment gains (losses) on transfers of assets from the general account to the separate accounts.