10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

for the transition period from _____ to _____

Commission file number 1-38769

Cigna Corporation

(Exact name of registrant as specified in its charter)

Delaware	82-4991898
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

900 Cottage Grove Road

Bloomfield, Connecticut 06002

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code (860) 226-6000

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01	CI	New York Stock Exchange, Inc.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No _

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No _

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller Reporting Company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Yes _

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of July 31, 2020, 367,200,629 shares of the issuer’s common stock were outstanding.

Cigna Corporation

TABLE OF CONTENTS

		Page
PART I	FINANCIAL INFORMATION
	Item 1. Financial Statements (Unaudited)	3
	Consolidated Statements of Income	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Balance Sheets	5
	Consolidated Statements of Changes in Total Equity	6
	Consolidated Statements of Cash Flows	8
	Notes to the Consolidated Financial Statements	10
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	54
	Item 3. Quantitative and Qualitative Disclosures About Market Risk	80
	Item 4. Controls and Procedures	80
PART II	OTHER INFORMATION
	Item 1. Legal Proceedings	80
	Item 1.A. Risk Factors	80
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	81
	Item 6. Exhibits	82
SIGNATURE		83

As used herein, “Cigna” or the “Company” refers to one or more of Cigna Corporation and its consolidated subsidiaries.

Part I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

Cigna Corporation Consolidated Statements of Income
	Unaudited				Unaudited
	Three Months Ended June 30,				Six Months Ended June 30,
(In millions, except per share amounts)	2020		2019		2020		2019
Revenues
Pharmacy revenues	$	26,564	$	26,288	$	51,662	$	51,467
Premiums	10,406		9,803		21,246		19,774
Fees and other revenues	2,072		2,388		4,250		4,838
Net investment income	223		340		576		686
Total revenues	39,265		38,819		77,734		76,765
Benefits and expenses
Pharmacy and other service costs	25,611		24,963		49,801		49,013
Medical costs and other benefit expenses	7,112		7,576		15,434		15,196
Selling, general and administrative expenses	3,407		3,380		6,805		6,683
Amortization of acquired intangible assets	496		737		994		1,480
Total benefits and expenses	36,626		36,656		73,034		72,372
Income from operations	2,639		2,163		4,700		4,393
Interest expense and other	(374)		(428)		(765)		(880)
Debt extinguishment costs	(14)		—		(199)		—
Net realized investment gains (losses)	38		23		(50)		33
Income before income taxes	2,289		1,758		3,686		3,546
Total income taxes	529		348		737		764
Net income	1,760		1,410		2,949		2,782
Less: net income attributable to noncontrolling interests	6		2		14		6
Shareholders’ net income	$	1,754	$	1,408	$	2,935	$	2,776
Shareholders’ net income per share
Basic	$	4.77	$	3.73	$	7.96	$	7.33
Diluted	$	4.73	$	3.70	$	7.88	$	7.26

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

3

Cigna Corporation Consolidated Statements of Comprehensive Income
	Unaudited				Unaudited
	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Net income	$	1,760	$	1,410	$	2,949	$	2,782
Other comprehensive income, net of tax
Net unrealized appreciation on securities and derivatives	709		343		281		785
Net translation gains (losses) on foreign currencies	70		(42)		(105)		(68)
Postretirement benefits liability adjustment	(42)		14		(29)		25
Other comprehensive income, net of tax	737		315		147		742
Total comprehensive income	2,497		1,725		3,096		3,524

Comprehensive income (loss) attributable to noncontrolling interests
Net income attributable to redeemable noncontrolling interest	4		2		8		5
Net income attributable to other noncontrolling interests	2		—		6		1
Other comprehensive (loss) attributable to redeemable noncontrolling interest	(2)		(2)		(6)		(4)
Total comprehensive income attributable to noncontrolling interests	4		—		8		2
SHAREHOLDERS' COMPREHENSIVE INCOME	$	2,493	$	1,725	$	3,088	$	3,522

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

4

Cigna Corporation Consolidated Balance Sheets
	Unaudited
(In millions)	As of June 30, 2020		As of December 31, 2019
Assets
Cash and cash equivalents	$	7,185	$	4,619
Investments	1,190		937
Accounts receivable, net	12,694		10,716
Inventories	2,712		2,661
Other current assets	1,311		1,400
Assets of business held for sale	9,788		9,512
Total current assets	34,880		29,845
Long-term investments	21,338		21,542
Reinsurance recoverables	4,942		5,100
Deferred policy acquisition costs	3,042		2,958
Property and equipment	4,255		4,417
Goodwill	44,590		44,602
Other intangible assets	35,791		36,562
Other assets	2,529		2,283
Separate account assets	8,261		8,465
TOTAL ASSETS	$	159,628	$	155,774
Liabilities
Current insurance and contractholder liabilities	$	5,060	$	4,921
Pharmacy and service costs payable	11,856		10,454
Accounts payable	5,413		5,090
Accrued expenses and other liabilities	7,991		7,347
Short-term debt	4,750		5,514
Liabilities of business held for sale	7,109		6,812
Total current liabilities	42,179		40,138
Non-current insurance and contractholder liabilities	16,064		16,052
Deferred tax liabilities, net	9,170		9,387
Other non-current liabilities	4,775		4,460
Long-term debt	31,774		31,893
Separate account liabilities	8,261		8,465
TOTAL LIABILITIES	112,223		110,395
Contingencies — Note 18
Redeemable noncontrolling interests	34		35
Shareholders’ equity
Common stock (1)	4		4
Additional paid-in capital	28,699		28,306
Accumulated other comprehensive loss	(788)		(941)
Retained earnings	23,052		20,162
Less: treasury stock, at cost	(3,601)		(2,193)
TOTAL SHAREHOLDERS’ EQUITY	47,366		45,338
Other noncontrolling interests	5		6
Total equity	47,371		45,344
Total liabilities and equity	$	159,628	$	155,774

(1)Par value per share, $0.01; shares issued, 389 million as of June 30, 2020 and 386 million as of December 31, 2019; authorized shares, 600 million.

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

5

Cigna Corporation
Consolidated Statements of Changes in Total Equity
Unaudited
Three Months Ended June 30, 2020
(In millions)	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at March 31, 2020	$	4		$	28,554	$	(1,527)	$	21,298	$	(3,250)	$	45,079	$	7	$	45,086	$	35
Effects of issuing stock for employee benefits plans			—	145						(6)		139				139
Other comprehensive income (loss)						739						739				739		(2)
Net income								1,754				1,754		2		1,756		4
Repurchase of common stock										(345)		(345)				(345)
Other transactions impacting noncontrolling interests												—		(4)		(4)		(3)
Balance at June 30, 2020	$	4		$	28,699	$	(788)	$	23,052	$	(3,601)	$	47,366	$	5	$	47,371	$	34
Three Months Ended June 30, 2019
(In millions)	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at March 31, 2019	$	4		$	27,855	$	(1,282)	$	16,426	$	(595)	$	42,408	$	5	$	42,413	$	38
Effect of issuing stock for employee benefit plans				36						52		88				88
Other comprehensive income (loss)						317						317				317		(2)
Net income								1,408				1,408				1,408		2
Repurchase of common stock										(406)		(406)				(406)
Other transactions impacting noncontrolling interests														(2)		(2)		(7)
Balance at June 30, 2019	$	4		$	27,891	$	(965)	$	17,834	$	(949)	$	43,815	$	3	$	43,818	$	31

6

Cigna Corporation
Consolidated Statements of Changes in Total Equity
Unaudited
Six Months Ended June 30, 2020
(In millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at December 31, 2019	$	4	$	28,306	$	(941)	$	20,162	$	(2,193)	$	45,338	$	6	$	45,344	$	35
Cumulative effect of adopting new credit loss guidance (ASU 2016-13) (1)							(30)				(30)				(30)
Effect of issuing stock for employee benefit plans			393						(84)		309				309
Other comprehensive income (loss)					153						153				153		(6)
Net income							2,935				2,935		6		2,941		8
Common dividends declared (per share: $0.04)							(15)				(15)				(15)
Repurchase of common stock									(1,324)		(1,324)				(1,324)
Other transactions impacting noncontrolling interests													(7)		(7)		(3)
Balance at June 30, 2020	$	4	$	28,699	$	(788)	$	23,052	$	(3,601)	$	47,366	$	5	$	47,371	$	34
Six Months Ended June 30, 2019
(In millions)	Common Stock		Additional Paid-in Capital		Accumulated Other Comprehensive (Loss)		Retained Earnings		Treasury Stock		Shareholders’ Equity		Other Non- controlling Interests		Total Equity		Redeemable Noncontrolling Interests
Balance at December 31, 2018	$	4	$	27,751	$	(1,711)	$	15,088	$	(104)	$	41,028	$	7	$	41,035	$	37
Cumulative effect of adopting new lease accounting guidance (ASU 2016-02)							(15)				(15)				(15)
Effect of issuing stock for employee benefit plans			140						23		163				163
Other comprehensive income (loss)					746						746				746		(4)
Net income							2,776				2,776		1		2,777		5
Common dividends declared (per share: $0.04)							(15)				(15)				(15)
Repurchase of common stock									(868)		(868)				(868)
Other transactions impacting noncontrolling interests													(5)		(5)		(7)
Balance at June 30, 2019	$	4	$	27,891	$	(965)	$	17,834	$	(949)	$	43,815	$	3	$	43,818	$	31

(1)See Note 3 for further information about the Company's adoption of new credit loss guidance (ASU 2016-13).

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

7

Cigna Corporation Consolidated Statements of Cash Flows
	Unaudited
	Six Months Ended June 30,
(In millions)	2020		2019
Cash Flows from Operating Activities
Net income	$	2,949	$	2,782
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,387		1,811
Realized investment losses (gains), net	50		(33)
Deferred income tax (benefit)	(259)		(241)
Debt extinguishment costs	199		—
Net changes in assets and liabilities, net of non-operating effects:
Accounts receivable	(2,121)		(1,165)
Inventories	(50)		524
Deferred policy acquisition costs	(177)		(99)
Reinsurance recoverable and Other assets	28		(177)
Insurance liabilities	483		297
Pharmacy and service costs payable	1,655		713
Accounts payable and Accrued expenses and other liabilities	630		(370)
Other, net	387		189
NET CASH PROVIDED BY OPERATING ACTIVITIES	5,161		4,231
Cash Flows from Investing Activities
Proceeds from investments sold:
Debt securities and equity securities	1,638		2,036
Investment maturities and repayments:
Debt securities and equity securities	765		738
Commercial mortgage loans	10		169
Other sales, maturities and repayments (primarily short-term and other long-term investments)	664		650
Investments purchased or originated:
Debt securities and equity securities	(2,150)		(2,212)
Commercial mortgage loans	(13)		(184)
Other (primarily short-term and other long-term investments)	(934)		(847)
Property and equipment purchases, net	(523)		(497)
Acquisitions, net of cash acquired	—		(6)
Other, net	37		(6)
NET CASH (USED IN) INVESTING ACTIVITIES	(506)		(159)
Cash Flows from Financing Activities
Deposits and interest credited to contractholder deposit funds	529		498
Withdrawals and benefit payments from contractholder deposit funds	(483)		(542)
Net change in short-term debt	(953)		(621)
Net proceeds on issuance of term loan	1,398		—
Payments for debt extinguishment	(212)		—
Repayment of long-term debt	(4,798)		(2,740)
Net proceeds on issuance of long-term debt	3,465		—
Repurchase of common stock	(1,324)		(866)
Issuance of common stock	229		70
Other, net	19		(106)
NET CASH (USED IN) FINANCING ACTIVITIES	(2,130)		(4,307)
Effect of foreign currency rate changes on cash, cash equivalents and restricted cash	(15)		(10)
Net increase (decrease) in cash, cash equivalents and restricted cash	2,510		(245)
Cash, cash equivalents, and restricted cash January 1, (1)	5,411		3,855
Cash, cash equivalents and restricted cash, June 30,	7,921		3,610
Cash reclassified to assets of business held for sale	(418)		—
Cash, cash equivalents, and restricted cash June 30, per Consolidated Balance Sheets (2)	$	7,503	$	3,610
Supplemental Disclosure of Cash Information:
Income taxes paid, net of refunds	$	190	$	1,190
Interest paid	$	743	$	865

(1) Includes restricted cash of $26 million reported in Other assets, $23 million in Long-term investments, and $743 million reported in Assets of business held for sale as of January 1, 2020.

(2) See table below for Cash, cash equivalents and restricted cash reconciliation as of June 30, 2020 and June 30, 2019.

8

The following table provides a reconciliation of cash, cash equivalents and restricted cash and cash equivalents reported within the Consolidated Balance Sheets to the totals above:

	Unaudited
	As of June 30,
	2020		2019
Cash and cash equivalents	$	7,185	$	3,610
Restricted cash and cash equivalents, included in other long-term investments	318		—
Total cash, cash equivalents, and restricted cash and cash equivalents	$	7,503	$	3,610

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

9

CIGNA CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

TABLE OF CONTENTS

Note Number	Footnote	Page
BUSINESS AND CAPITAL STRUCTURE
1	Description of Business	11
2	COVID-19 and Related Economic Impact	12
3	Summary of Significant Accounting Policies	13
4	Accounts Receivable, Net	15
5	Mergers and Acquisitions	16
6	Assets and Liabilities of Business Held for Sale	17
7	Earnings Per Share	17
8	Debt	19
INSURANCE INFORMATION
9	Insurance and Contractholder Liabilities	21
10	Reinsurance	24
INVESTMENTS
11	Investments	28
12	Fair Value Measurements	36
13	Variable Interest Entities	42
14	Accumulated Other Comprehensive Income (Loss)	44
WORKFORCE MANAGEMENT AND COMPENSATION
15	Organizational Efficiency Plan	45
PROPERTY, LEASES AND OTHER ASSET BALANCES
16	Leases	45
COMPLIANCE, REGULATION AND CONTINGENCIES
17	Income Taxes	45
18	Contingencies and Other Matters	46
RESULTS DETAILS
19	Segment Information	49

10

Note 1 – Description of Business

Cigna Corporation, together with its subsidiaries (either individually or collectively referred to as “Cigna,” the “Company,” “we,” “our” or “us”) is a global health service organization with a mission of helping those we serve improve their health, well-being and peace of mind. We offer a differentiated set of pharmacy, medical, dental, disability, life and accident insurance and related products and services offered by our subsidiaries.

The majority of these products are offered through employers and other groups such as governmental and non-governmental organizations, unions and associations. Cigna also offers commercial health and dental insurance, Medicare and Medicaid products and health, life and accident insurance coverages to individuals in the United States and selected international markets. In addition to these ongoing operations, Cigna also has certain run-off operations.

The Company reports its results in the following segments.

Health Services includes pharmacy benefits management, specialty pharmacy services, clinical solutions, home delivery and health management services.

Integrated Medical offers a variety of health care solutions to employers and individuals.

•The Commercial operating segment serves employers (also referred to as “clients”) and their employees (also referred to as “customers”) and other groups. This segment provides deeply integrated medical and specialty offerings including medical, pharmacy, dental, behavioral health and vision, health advocacy programs and other products and services to insured and self-insured clients.

•The Government operating segment offers Medicare Advantage, Medicare Supplement and Medicare Part D plans for seniors (including the acquired Express Scripts' Medicare Part D business), Medicaid plans, and individual health insurance coverage both on and off the public exchanges.

International Markets includes supplemental health, life and accident insurance products and health care coverage in our international markets, as well as health care benefits to globally mobile employees of multinational organizations.

The remainder of our business operations are reported in Group Disability and Other, consisting of the following:

•Group Disability and Life provides group long-term and short-term disability, group life, accident, voluntary and specialty insurance products and related services. In December 2019, Cigna entered into a definitive agreement to sell the U.S. Group Disability and Life insurance business to New York Life Insurance Company. See Note 6 for further information on the classification of this business as held for sale.

•Corporate-Owned Life Insurance (“COLI”) offers permanent insurance contracts sold to corporations to provide coverage on the lives of certain employees for the purpose of financing employer-paid future benefit obligations.

•Run-off businesses:

•Reinsurance: predominantly comprised of guaranteed minimum death benefit (“GMDB”) and guaranteed minimum income benefit (“GMIB”) business effectively exited through reinsurance with Berkshire Hathaway Life Insurance Company of Nebraska (“Berkshire”) in 2013.

•Settlement Annuity business in run-off.

11

•Individual Life Insurance and Annuity and Retirement Benefits Businesses: deferred gains from the sales of these businesses.

Corporate reflects amounts not allocated to operating segments, including interest expense, net investment income on investments not supporting segment and other operations, interest on uncertain tax positions, certain litigation matters, expense associated with our frozen pension plans, severance, certain enterprise-wide projects and intersegment eliminations for products and services sold between segments.

Note 2 – COVID-19 and Related Economic Impact

Cigna continues to actively monitor all aspects of our business in light of the ongoing coronavirus ("COVID-19") pandemic. As described below, management has taken a number of steps to assess the impact on our business, including the financial reporting implications associated with this pandemic.

The COVID-19 pandemic has pervasively impacted the economy, financial markets and the global health care delivery systems during the second quarter, including significant deferral of care of our customers. These impacts were most prominent in April 2020 and moderated throughout the quarter with utilization levels returning to nearly normal levels by the end of June 2020. These impacts were most significant in our Integrated Medical segment where results reflect higher quarterly earnings and a lower medical care ratio as a result of the deferral of care significantly exceeding the incremental COVID-19 costs, partially offset by COVID-19 related actions including premium relief programs for clients as well as cost share waivers for customers. The Health Services segment quarterly earnings also reflected effects of the pandemic, specifically, a favorable mix of claims as a result of both the type of drugs dispensed as well as the distribution method used for dispensing and fulfilling, partially offset by lower non-specialty, 30-day retail script volume.

The Company conducted its normal quarterly qualitative assessment of goodwill impairment, and concluded that the current economic and business conditions did not result in a triggering event requiring a quantitative impairment analysis. All other long-lived assets, including intangible assets, were reviewed for impairment and no material impairments were recorded for the six months ended June 30, 2020.

The Company reviewed all classes of financial instruments including investments, accounts receivable and reinsurance recoverables, and recorded an additional allowance for expected credit losses of $48 million related to investments (see Note 11) and $13 million related to accounts receivable (see Note 4) for the six months ended June 30, 2020. The Company also initiated several actions to assist our customers, clients, health care providers, and employees in this time of crisis.

Additionally, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. The direct impact of this new legislation was not material to the Company's results of operations for the six months ended June 30, 2020. As permitted by the CARES Act and COVID-19 related regulatory actions, the Company deferred approximately $900 million in income and payroll tax payments during the second quarter of 2020. Approximately $825 million of the deferred tax payments will be made during the third quarter of 2020. The Company did not request any funding under the CARES Act. However, in April 2020 the Company received $41 million from the provider relief fund which was immediately returned to the U.S. Department of Health and Human Services.

12

Note 3 – Summary of Significant Accounting Policies

Basis of Presentation

The Consolidated Financial Statements include the accounts of Cigna Corporation and its consolidated subsidiaries. Intercompany transactions and accounts have been eliminated in consolidation. These Consolidated Financial Statements were prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

Amounts recorded in the Consolidated Financial Statements necessarily reflect management’s estimates and assumptions about medical costs, investment and receivable valuations, interest rates and other factors. Significant estimates are discussed throughout these Notes; however, actual results could differ from those estimates. The impact of a change in estimate is generally included in earnings in the period of adjustment.

These interim Consolidated Financial Statements are unaudited but include all adjustments (including normal recurring adjustments) necessary, in the opinion of management, for a fair statement of financial position and results of operations for the periods reported. The interim Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes included in the 2019 Annual Report on Form 10-K (“2019 Form 10-K”). The preparation of interim Consolidated Financial Statements necessarily relies heavily on estimates. This and other factors, including the seasonal nature of portions of the health care and related benefits business, competitive and other market conditions, as well as COVID-19 related impacts, call for caution in estimating full-year results based on interim results of operations.

Recent Accounting Pronouncements

The Company's 2019 Form 10-K includes discussion of significant recent accounting pronouncements that either have impacted our financial statements or may impact them in the future. The following information provides updates on recently adopted or recently issued accounting pronouncements that have occurred since the Company filed its 2019 Form 10-K.

13

Recently Adopted Accounting Guidance

Accounting Standard and Adoption Date	Requirements and Effects of Adopting New Guidance
Measurement of Credit Losses on Financial Instruments (Accounting Standards Update (ASU) 2016-13 and related amendments) Adopted as of January 1, 2020	Requires:
	•	A new approach using expected credit losses to estimate and recognize credit losses for certain financial instruments (such as mortgage loans, reinsurance recoverables and other receivables) when such instruments are first originated or acquired, and in each subsequent reporting period, compared with the incurred loss model previously followed under GAAP. At adoption, the Company recorded an allowance for estimated credit losses and subsequent changes in the allowance will be reported in current period earnings.
	•	Changes in the criteria for impairment of available-for-sale debt securities
	Effects of adoption:
	•	Adopted using a modified retrospective approach
	•	Cumulative effect adjustment of $30 million after-tax was recorded as a reduction to retained earnings as of January 1, 2020, reflecting an additional allowance for future expected credit losses required under the new model, primarily related to reinsurance recoverables.
	•	See additional information regarding the Company’s accounting policy for establishing the allowance for credit losses in Note 4, Accounts Receivable, Net, Note 10, Reinsurance, and Note 11, Investments.
Simplifying the Test for Goodwill Impairment (ASU 2017-04) Adopted as of January 1, 2020	Requires:
	•	A simplified approach to the accounting for goodwill impairment by eliminating the need to determine the fair value of individual assets and liabilities of a reporting unit to measure a goodwill impairment
	•	The amount of goodwill impairment to equal the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the total amount of goodwill of the reporting unit
	Effects of adoption:
	•	Adopted on a prospective basis
	•	There was no impact of adopting this new standard to the Company’s financial statements because our quarterly qualitative assessments did not result in a triggering event for impairment of goodwill.

14

Accounting Guidance Not Yet Adopted

Accounting Standard and Effective Date	Requirements and Expected Effects of New Guidance Not Yet Adopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASU 2020-04) Optional, effective upon issuance (March 12, 2020) through December 31, 2022	Guidance:
	•	Provides temporary optional relief to ease the potential burden of accounting for reference rate reform under existing GAAP. Amendments are elective and apply to all entities that have contracts, hedging relationships and other transactions that reference interbank offered rates, including LIBOR, expected to be discontinued by December 31, 2021.
	•	Permits optional expedients and exceptions to simplify the accounting for contract modifications, hedging arrangements and held-to-maturity investments, when certain changes are made to a contract or instrument to facilitate reference rate reform.
	•	An entity may elect to apply the amendments, by topic or subsection, at any point prospectively through December 31, 2022. When elected, the optional expedients must be applied consistently for all eligible contracts or transactions.
	Expected effects:
	•	To date, the Company has identified minimal exposure to LIBOR and does not anticipate that LIBOR’s phase-out will have a material impact on its operations or financial results.

The Financial Accounting Standards Board voted to propose the deferral of the effective date of ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts and, in July 2020, issued a proposed standard for comment extending the effective date by one year, or until January 1, 2023 for the Company.

Note 4 - Accounts Receivable, Net

Accounting policy. The Company's accounts receivable balances primarily include amounts due from clients, third-party payors, customers and pharmaceutical manufacturers, and are presented net of allowances. The Company's adoption of ASU 2016-13, Measurement of Credit Losses on Financial Instruments (ASU 2016-13), as of January 1, 2020 did not have a material impact on our accounts receivable credit loss allowance, as there were no substantive changes to our methodology for this class of assets. The allowance for expected credit losses for current accounts receivable is based primarily on past collections experience relative to the length of time receivables are past due; however, when available evidence reasonably supports an assumption that counterparty credit risk over the expected payment period will differ from current and historical payment collections, a forecasting adjustment is reflected in the allowance for expected credit losses.

All other (non-credit) allowances are based on the current status of each customer's receivable balance as well as current economic and market conditions and a variety of other factors, including the length of time the receivables are past due, the financial health of customers and our past experience. We bill pharmaceutical manufacturers based on management's interpretation of contractual terms and estimate a contractual allowance based on the best information available at the time a claim is processed. Contractual allowances for certain rebates receivable from pharmaceutical manufacturers are determined by reviewing payment experience and specific known items that could be adjusted under contract terms. The Company's estimation process for contractual allowances for pharmaceutical manufacturer receivables generally results in an allowance for balances outstanding greater than 90 days.

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Contractual allowances for certain receivables from third-party payors are based on their contractual terms and are estimates based on the Company's best information available at the time revenue is recognized.

Receivables and any associated allowance are written off only when all collection attempts have failed and such amounts are determined unrecoverable. We regularly review the adequacy of these allowances based on a variety of factors, including age of the outstanding receivable and collection history. When circumstances related to specific collection patterns change, estimates of the recoverability of receivables are adjusted.

The following amounts were included within accounts receivable, net:

(In millions)	June 30, 2020		December 31, 2019
Noninsurance customer receivables	$	5,678	$	5,143
Pharmaceutical manufacturers receivable	4,654		3,439
Insurance customer receivables	2,607		2,321
Other receivables	386		334
Total	13,325		11,237
Accounts receivable, net classified as assets of business held for sale	(631)		(521)
Accounts receivable, net per Consolidated Balance Sheets	$	12,694	$	10,716

These receivables are reported net of our allowances of $1.1 billion as of June 30, 2020 and $778 million as of December 31, 2019. These allowances include contractual allowances for certain rebates receivable with pharmaceutical manufacturers and certain receivables from third-party payors, discounts and claims adjustments issued to customers in the form of client credits, an allowance for the balance of our risk corridor receivables under the Patient Protection and Affordable Care Act ("ACA"), an allowance for current expected credit losses and other non-credit adjustments. The Company's allowance for current expected credit losses was $72 million as of June 30, 2020 and $39 million as of January 1, 2020 (no change to allowance for credit losses from December 31, 2019). The allowance for current expected credit losses as of June 30, 2020 includes an additional forecasting adjustment of $13 million related to COVID-19.

Note 5 – Mergers and Acquisitions

Integration and Transaction-related Costs

The Company incurred integration and transaction costs related to the acquisition and integration of Express Scripts, the terminated merger with Anthem, Inc. (“Anthem”), the sale of the U.S. Group Disability and Life insurance business, and other transactions. These costs were $130 million pre-tax ($99 million after-tax) for the three months and $227 million pre-tax ($173 million after tax) for the six months ended June 30, 2020, compared with $155 million pre-tax ($115 million after-tax) for the three months and $291 million pre-tax ($223 million after-tax) for the six months ended June 30, 2019. These costs consisted primarily of certain projects to integrate or separate the Company’s systems, products and services, fees for legal, advisory and other professional services and certain employment-related costs.

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Note 6 – Assets and Liabilities of Business Held for Sale

In December 2019, Cigna entered into a definitive agreement to sell its U.S. Group Disability and Life insurance business to New York Life Insurance Company for $6.3 billion. The sale is expected to close in the third quarter of 2020 following applicable regulatory approvals and other customary closing conditions. The Company believes this sale is probable and has aggregated and classified the assets and liabilities directly associated with the pending sale of its Group Disability and Life insurance business as held for sale and has reported them separately on our Consolidated Balance Sheets as of June 30, 2020 and December 31, 2019. The assets and liabilities of business held for sale were as follows:

(In millions)	June 30, 2020		December 31, 2019
Cash and cash equivalents	$	418	$	743
Accounts receivable, net	631		521
Investments	8,181		7,709
Other assets	558		539
Total assets of business held for sale	9,788		9,512
Insurance and contractholder liabilities	6,549		6,308
Other liabilities	560		504
Total liabilities of business held for sale	$	7,109	$	6,812

Note 7 – Earnings Per Share (“EPS”)

Basic and diluted earnings per share were computed as follows:

	Three Months Ended
	June 30, 2020						June 30, 2019
(Shares in thousands, dollars in millions, except per share amounts)	Basic		Effect of Dilution		Diluted		Basic		Effect of Dilution		Diluted
Shareholders’ net income	$	1,754			$	1,754	$	1,408			$	1,408
Shares:
Weighted average	367,396				367,396		377,962				377,962
Common stock equivalents			3,301		3,301				3,007		3,007
Total shares	367,396		3,301		370,697		377,962		3,007		380,969
EPS	$	4.77	$	(0.04)	$	4.73	$	3.73	$	(0.03)	$	3.70

	Six Months Ended
	June 30, 2020						June 30, 2019
(Shares in thousands, dollars in millions, except per share amounts)	Basic		Effect of Dilution		Diluted		Basic		Effect of Dilution		Diluted
Shareholders’ net income	$	2,935			$	2,935	$	2,776			$	2,776
Shares:
Weighted average	368,918				368,918		378,672				378,672
Common stock equivalents			3,750		3,750				3,824		3,824
Total shares	368,918		3,750		372,668		378,672		3,824		382,496
EPS	$	7.96	$	(0.08)	$	7.88	$	7.33	$	(0.07)	$	7.26

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The following outstanding employee stock options were not included in the computation of diluted earnings per share because their effect was anti-dilutive.

	Three Months Ended June 30,		Six Months Ended June 30,
(In millions)	2020	2019	2020	2019
Anti-dilutive options	4.0	5.4	4.0	4.1

The Company held approximately 20.8 million shares of common stock in treasury at June 30, 2020, 13.0 million shares as of December 31, 2019 and 6.2 million shares as of June 30, 2019.

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Note 8 – Debt

The outstanding amounts of debt and finance leases were as follows:

(In millions)	June 30, 2020		December 31, 2019
Short-term debt
$1,000 million, Floating Rate Notes due 3/2020	$	—	$	999
$300 million, 5.125% Notes due 6/2020	—		300
$1,750 million, 3.2% Notes due 9/2020	1,750		1,748
$349 million, 4.125% Notes due 9/2020	349		351
$500 million, 2.6% Notes due 11/2020	498		496
$400 million, Floating Rate Notes due 11/2020	400		400
$250 million, 4.375% Notes due 12/2020	250		249
$1,400 million, Floating Rate Term Loan due 3/2021	1,398		—
$78 million, 6.37% Notes due 6/2021	78		—
Commercial paper	5		944
Other, including finance leases	22		27
Total short-term debt	$	4,750	$	5,514
Long-term debt
$500 million, 3.3% Notes due 2021	$	—	$	499
$300 million, 4.5% Notes due 2021	—		298
$78 million, 6.37% Notes due 2021	—		78
$1,000 million, Floating Rate Notes due 2021	998		998
$1,250 million, 3.4% Notes due 2021	1,248		1,247
$1,248 million, 4.75% Notes due 2021	—		1,272
$277 million, 4% Notes due 2022	276		747
$973 million, 3.9% Notes due 2022	972		999
$500 million, 3.05% Notes due 2022	488		485
$17 million, 8.3% Notes due 2023	17		17
$63 million, 7.65% Notes due 2023	63		100
$700 million, Floating Rate Notes due 2023	698		698
$1,000 million, 3% Notes due 2023	971		966
$2,187 million, 3.75% Notes due 2023	2,180		3,088
$1,000 million, 3.5% Notes due 2024	974		970
$900 million, 3.25% Notes due 2025	895		895
$2,200 million, 4.125% Notes due 2025	2,189		2,188
$1,500 million, 4.5% Notes due 2026	1,505		1,506
$1,500 million, 3.4% Notes due 2027	1,404		1,396
$259 million, 7.875% Debentures due 2027	259		259
$600 million, 3.05% Notes due 2027	595		595
$3,800 million, 4.375% Notes due 2028	3,778		3,776
$1,500 million, 2.4% Notes due 2030	1,489		—
$45 million, 8.3% Step Down Notes due 2033	45		45
$190 million, 6.15% Notes due 2036	190		190
$2,200 million, 4.8% Notes due 2038	2,179		2,178
$750 million, 3.2% Notes due 2040	742		—
$121 million, 5.875% Notes due 2041	119		119
$448 million, 6.125% Notes due 2041	490		491
$317 million, 5.375% Notes due 2042	315		315
$1,500 million, 4.8% Notes due 2046	1,464		1,465
$1,000 million, 3.875% Notes due 2047	988		988
$3,000 million, 4.9% Notes due 2048	2,965		2,964
$1,250 million, 3.4% Notes due 2050	1,235		—
Other, including finance leases	43		61
Total long-term debt	$	31,774	$	31,893

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Debt issuance and redemption. In order to decrease future interest expense and reduce future refinancing risk, the Company entered into the following transactions:

•Debt issuance: On March 16, 2020, the Company issued $3.5 billion of new senior notes. The proceeds of this debt were mainly used to pay the consideration for the cash tender and redemption offer as described below. Interest on this debt is paid semi-annually.

Principal	Maturity Date	Interest Rate	Net Proceeds
$1,500 million	March 15, 2030	2.40%	$1,491 million
$750 million	March 15, 2040	3.20%	$743 million
$1,250 million	March 15, 2050	3.40%	$1,237 million

•Debt tender and redemption: In March and April 2020, the Company completed a tender offer and an optional redemption totaling $3.5 billion of aggregate principal amount of certain of its outstanding debt securities. The principal amount repurchased in this tender offer was $1.5 billion. Additionally, $2.0 billion of notes were repurchased via optional redemption. The Company recorded a pre-tax loss of $199 million ($151 million after-tax), consisting primarily of premium payments on the tender and optional redemption.

Debt Exchange. In the fourth quarter of 2019, the Company settled an exchange of approximately $12.7 billion of Notes issued by Express Scripts Holding Company, Medco Health Solutions, Inc. and Cigna Holding Company (formerly named Cigna Corporation) for privately placed Notes issued by Cigna with the same interest rates and maturities and comparable other terms. We initiated an exchange offer to register such debt in the second quarter of 2020 and completed the exchange in July 2020.

Debt Repayment. During the first six months of 2020, the Company repaid $4.8 billion of long-term debt, including the $3.5 billion debt tender and redemption described above.

Revolving Credit Agreements. Cigna has a revolving credit and letter of credit agreement that matures in April 2023 and is diversified among 23 banks. Cigna can borrow up to $3.25 billion for general corporate purposes, with up to $500 million available for issuance of letters of credit. This revolving credit agreement also includes an option to increase the facility amount up to $500 million and an option to extend the termination date for additional one year periods, subject to consent of the banks.

In the fourth quarter of 2019, the Company entered into an additional 364-day revolving credit agreement that matures in October 2020 and is diversified among 23 banks. Pursuant to this revolving credit agreement, Cigna can borrow up to $1.0 billion for general corporate purposes. The agreement includes the option to “term out” any revolving loans that are outstanding at maturity by converting them into a term loan maturing on the one year anniversary of conversion.

The revolving credit agreements contain customary covenants and restrictions including a financial covenant that the Company’s leverage ratio may not exceed 60%. As of June 30, 2020, there were no outstanding balances under the revolving credit agreements.

Term Loan Credit Agreement. On April 1, 2020, the Company borrowed an aggregate principal amount of $1.4 billion under a new 364-Day Term Loan Credit Agreement (the "Credit Agreement"). The Company entered into the Credit Agreement to enhance its liquidity position in light of disruption in the commercial paper market and used a portion of the net proceeds to pay down amounts outstanding under its commercial paper facility. The Credit Agreement may be prepaid at any time in whole or in part without premium or penalty. Term loans prepaid may not be reborrowed. The Credit Agreement provides for mandatory prepayment of the term loans in an amount equal to 20% of any Net Cash Proceeds (as defined in the Credit Agreement) arising from the previously announced sale of Cigna’s U.S. Group Disability and Life insurance business to New York Life Insurance Company.

Commercial Paper. The commercial paper program had approximately $5 million outstanding at June 30, 2020 at an average interest rate of 1.0%.

The Company was in compliance with its debt covenants as of June 30, 2020.

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Note 9 – Insurance and Contractholder Liabilities

A.Account Balances – Insurance and Contractholder Liabilities

As of June 30, 2020, December 31, 2019 and June 30, 2019, the Company’s insurance and contractholder liabilities were comprised of the following:

	June 30, 2020						December 31, 2019						June 30, 2019
(In millions)	Current		Non-current		Total		Current		Non-current		Total		Total
Contractholder deposit funds	$	627	$	7,062	$	7,689	$	600	$	7,139	$	7,739	$	7,883
Future policy benefits	528		9,417		9,945		553		9,281		9,834		9,715
Unpaid claims and claim expenses
Integrated Medical	2,942		17		2,959		2,875		17		2,892		2,881
Other segments	2,551		3,599		6,150		2,529		3,474		6,003		5,793
Unearned premiums	561		369		930		453		360		813		776
Total	7,209		20,464		27,673		7,010		20,271		27,281		27,048
Insurance and contractholder liabilities classified as liabilities of business held for sale(1)	(2,149)		(4,400)		(6,549)		(2,089)		(4,219)		(6,308)
Total insurance and contractholder liabilities	$	5,060	$	16,064	$	21,124	$	4,921	$	16,052	$	20,973	$	27,048

⁽¹⁾ Amounts classified as Liabilities of business held for sale primarily include $5.1 billion of unpaid claims, $758 million of contractholder deposit funds and $644 million of future policy benefits as of June 30, 2020 and $4.9 billion of unpaid claims, $717 million of contractholder deposit funds and $653 million of future policy benefits as of December 31, 2019.

Insurance and contractholder liabilities expected to be paid within one year are classified as current.

B.Unpaid Claims and Claim Expenses – Integrated Medical

This liability reflects estimates of the ultimate cost of claims that have been incurred but not reported, including expected development on reported claims, those that have been reported but not yet paid (reported claims in process), and other medical care expenses and services payable that are primarily comprised of accruals for incentives and other amounts payable to health care professionals and facilities.

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The total of incurred but not reported liabilities plus expected development on reported claims, including reported claims in process, was $2.7 billion at June 30, 2020 and June 30, 2019.

Activity, net of intercompany transactions, in the unpaid claims liability for the Integrated Medical segment for the six months ended June 30 was as follows:

	Six Months Ended
(In millions)	June 30, 2020		June 30, 2019
Beginning balance	$	2,892	$	2,697
Less: Reinsurance and other amounts recoverable	303		264
Beginning balance, net	2,589		2,433
Incurred costs related to:
Current year	12,212		12,120
Prior years	(130)		(149)
Total incurred	12,082		11,971
Paid costs related to:
Current year	9,585		9,629
Prior years	2,284		2,134
Total paid	11,869		11,763
Ending balance, net	2,802		2,641
Add: Reinsurance and other amounts recoverable	157		240
Ending balance	$	2,959	$	2,881

Reinsurance and other amounts recoverable reflect amounts due from reinsurers and policyholders to cover incurred but not reported and pending claims of certain business for which the Company administers the plan benefits without any right of offset. See Note 10 for additional information on reinsurance.

Variances in incurred costs related to prior years’ unpaid claims and claims expenses that resulted from the differences between actual experience and the Company’s key assumptions for the six months ended June 30 were as follows:

	Six Months Ended
(Dollars in millions)	June 30, 2020				June 30, 2019
	$		%(1)		$		%(2)
Actual completion factors	$	50	0.2	%	$	91	0.4	%
Medical cost trend	80		0.3		58		0.3
Total favorable variance	$	130	0.5	%	$	149	0.7	%

(1)Percentage of current year incurred costs as reported for the year ended December 31, 2019.

(2)Percentage of current year incurred costs as reported for the year ended December 31, 2018.

Incurred costs related to prior years in the table above, although adjusted through shareholders’ net income, do not directly correspond to an increase or decrease to shareholders’ net income. The primary reason for this difference is that decreases to prior year incurred costs pertaining to the portion of the liability established for moderately adverse conditions are not considered as impacting shareholders’ net income if they are offset by increases in the current year provision for moderately adverse conditions.

Prior year development increased shareholders’ net income by $44 million ($56 million before-tax) for the six months ended June 30, 2020, compared with $62 million ($78 million before-tax) for the six months ended June 30, 2019. Favorable prior year development in both periods reflects lower than expected utilization of medical services.

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C.Unpaid Claims and Claim Expenses – Group Disability and Other and International Markets

Liability balance details. The liability details for unpaid claims and claim expenses are as follows:

(In millions)	June 30, 2020 (1)		June 30, 2019
Group Disability and Other
Group Disability and Life	$	5,165	$	4,827
Other Operations	160		195
Total Group Disability and Other	5,325		5,022
International Markets	825		771
Unpaid claims and claim expenses Group Disability and Other and International Markets	$	6,150	$	5,793

⁽¹⁾ Includes unpaid claim amounts classified as Liabilities of business held for sale.

Activity in the Company’s liabilities for unpaid claims and claim expenses, excluding Other Operations, are presented in the following table. Liabilities associated with Other Operations are excluded because they pertain to obligations for long-duration insurance contracts or, if short-duration, the liabilities have been fully reinsured.

	Six Months Ended
(In millions)	June 30, 2020(1)		June 30, 2019
Beginning balance	$	5,816	$	5,432
Less: Reinsurance	184		156
Beginning balance, net	5,632		5,276
Incurred claims related to:
Current year	2,829		2,814
Prior years:
Interest accretion	81		81
All other incurred	(8)		(42)
Total incurred	2,902		2,853
Paid claims related to:
Current year	1,357		1,415
Prior years	1,353		1,275
Total paid	2,710		2,690
Foreign currency	(14)		(16)
Ending balance, net	5,810		5,423
Add: Reinsurance	180		175
Ending balance	$	5,990	$	5,598

⁽¹⁾ Includes Unpaid claims amounts classified as Liabilities of business held for sale.

Reinsurance in the table above reflects amounts due from reinsurers related to unpaid claims liabilities. The Company’s insurance subsidiaries enter into agreements with other companies primarily to limit losses from large exposures and to permit recovery of a portion of incurred losses. See Note 10 for additional information on reinsurance.

The majority of the liability for unpaid claims and claim expenses is related to disability claims with long-tailed payouts that relate to a business held for sale. Interest earned on assets backing these liabilities is an integral part of pricing and reserving. Therefore, interest accreted on prior year balances is shown as a separate component of prior

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year incurred claims and reported in Medical costs and other benefit expenses in the income statement. This interest is calculated by applying the average discount rate used in determining the liability balance to the average liability balance over the period. The remaining prior year incurred claims amount primarily reflects updates to the Company’s liability estimates and variances between actual experience during the period relative to the assumptions and expectations reflected in determining the liability. Assumptions reflect the Company’s expectations over the life of the book of business and will vary from actual experience in any period, both favorably and unfavorably, with variation in resolution rates being the most significant driver for the long-term disability business. Favorable prior year incurred claims for the six months ended June 30, 2020 primarily reflected favorable experience in Europe and the Middle East and favorable Voluntary and Life incidence, partially offset by unfavorable long-term disability resolution rate experience relative to expectations reflected in the prior year reserve. Favorable prior year incurred claims for the six months ended June 30, 2019 primarily reflected favorable life and voluntary loss ratio experience relative to expectations reflected in the prior year reserve.

Note 10 – Reinsurance

The Company’s insurance subsidiaries enter into agreements with other insurance companies to assume and cede reinsurance. Reinsurance is ceded primarily in acquisition and disposition transactions when the underwriting company is not being acquired. Reinsurance is also used to limit losses from large exposures and to permit recovery of a portion of direct or assumed losses. Reinsurance does not relieve the originating insurer of liability. Therefore, reinsured liabilities must continue to be reported along with the related reinsurance recoverables. The Company regularly evaluates the financial condition of its reinsurers and monitors concentrations of its credit risk.

A.Reinsurance Recoverables

Accounting policy. Reinsurance recoverables represent amounts due from reinsurers for both paid and unpaid claims of the Company’s insurance businesses. Most reinsurance recoverables are classified as non-current assets. The current portion of reinsurance recoverables is reported in Other current assets and consists primarily of recoverables on paid claims expected to be settled within one year. Reinsurance recoverables are presented net of allowances for uncollectible reinsurance that, effective with adopting ASU 2016-13 on January 1, 2020, consists primarily of an allowance for expected credit losses. Estimates of the allowance for expected credit losses are based on internal and external data used to develop expected loss rates over the anticipated duration of the recoverable asset that vary by external credit rating and collateral level. The Company's allowance for credit losses on reinsurance recoverables was $34 million as of June 30, 2020, of which $31 million was through a cumulative effect adjustment to retained earnings at adoption.

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The majority of the Company’s reinsurance recoverables resulted from acquisition and disposition transactions in which the underwriting company was not acquired. Included in the table below is $224 million of current reinsurance recoverables that are reported in Other current assets as of June 30, 2020; as of December 31, 2019 there was $222 million of current reinsurance recoverables reported in Other current assets. The Company’s reinsurance recoverables are presented in the following table by range of external credit rating and collateral level.

(Dollars in millions)	Fair value of collateral contractually required to meet or exceed carrying value of recoverable		Collateral provisions exist that may mitigate risk of credit loss (3)		No collateral		Total
Ongoing Operations
Upper-medium grade and higher (1)	$	—	$	6	$	311	$	317
Lower-medium grade (2)	—		—		66		66
Not rated	89		14		17		120
Total recoverables related to ongoing operations (3)	$	89	$	20	$	394	$	503
Acquisition, disposition or runoff activities
Upper-medium grade and higher (1)
Lincoln National Life and Lincoln Life & Annuity of New York	—		3,064		—		3,064
Berkshire	329		493		—		822
Prudential Retirement Insurance and Annuity	660		—		—		660
Other	241		21		19		281
Not rated	—		40		3		43
Total recoverables related to acquisition, disposition or runoff activities	1,230		3,618		22		4,870
Total	$	1,319	$	3,638	$	416	$	5,373
Allowance for uncollectible reinsurance							(34)
Reinsurance recoverables classified as assets of business held for sale							(173)
Total reinsurance recoverables							$	5,166
(1) Includes A- equivalent and higher current ratings certified by a nationally recognized statistical rating organization ('NRSRO')
(2) Includes BBB- to BBB+ equivalent current credit ratings certified by a NRSRO
(3) This includes collateral provisions requiring the reinsurer to fully collateralize its obligation if its external credit rating is downgraded to a specified level

Collateral levels are defined internally based on the fair value of the collateral relative to the carrying amount of the reinsurance recoverable, the frequency at which collateral is required to be replenished and the potential for volatility in the collateral’s fair value. The Company bears the risk of loss if its reinsurers and retrocessionaires do not meet or are unable to meet their reinsurance obligations to the Company. The Company reviews its reinsurance arrangements and establishes reserves against the recoverables, as further described above.

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B.Effects of Reinsurance

In the Company’s Consolidated Statements of Income, premiums were reported net of amounts ceded to reinsurers and medical costs and other benefit expenses were reported net of reinsurance recoveries in the following amounts:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Total ceded premiums	$	117	$	126	$	245	$	256
Total reinsurance recoveries	$	102	$	53	$	280	$	112

C.Effective Exit of GMDB and GMIB Business

The Company entered into an agreement with Berkshire to effectively exit the GMDB and GMIB business via a reinsurance transaction in 2013. Berkshire reinsured 100% of the Company’s future claim payments in this business, net of other reinsurance arrangements existing at that time. The reinsurance agreement is subject to an overall limit with approximately $3.3 billion remaining at June 30, 2020.

GMDB is accounted for as assumed and ceded reinsurance and GMIB assets and liabilities are reported as derivatives at fair value as discussed below. GMIB assets are reported in Other current assets and Other assets, and GMIB liabilities are reported in Accrued expenses and other liabilities and Other non-current liabilities.

GMDB

The GMDB exposure arises under annuities written by ceding companies that guarantee the benefit received at death. The Company’s exposure arises when the guaranteed minimum death benefit exceeds the fair value of the related mutual fund investments at the time of a contractholder’s death.

The following table presents the account value, net amount at risk and the number of contractholders for guarantees assumed by the Company in the event of death. The net amount at risk is the amount that the Company would have to pay if all contractholders died as of the specified date. The Company should be reimbursed in full for these payments unless the Berkshire reinsurance limit is exceeded.

(Dollars in millions, excludes impact of reinsurance ceded)	June 30, 2020		December 31, 2019
Account value	$	8,424	$	9,110
Net amount at risk	$	1,776	$	1,764
Number of contractholders (estimated)	190,000		200,000

GMIB

The Company reinsured contracts with issuers of GMIB products. The Company’s exposure represents the excess of a contractually guaranteed amount over the level of variable annuity account values. Payment by the Company depends on the actual account value in the related underlying mutual funds and the level of interest rates when the contractholders elect to receive minimum income payments that can only occur within 30 days of a policy

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anniversary after the appropriate waiting period. The Company has purchased retrocessional coverage (“GMIB assets”) for these contracts including retrocessional coverage from Berkshire.

Assumptions used in fair value measurement. GMIB assets and liabilities are established using capital market assumptions and assumptions related to future annuitant behavior (including mortality, lapse, and annuity election rates). The Company classifies GMIB assets and liabilities in Level 3 of the fair value hierarchy described in Note 12 because assumptions related to future annuitant behavior are largely unobservable.

The only assumption expected to impact future shareholders’ net income is non-performance risk. The non-performance risk adjustment reflects a market participant’s view of nonpayment risk by adding an additional spread to the discount rate in the calculation of both (a) the GMIB liabilities to be paid by the Company, and (b) the GMIB assets to be paid by the reinsurers, after considering collateral. The impact of non-performance risk was immaterial for the three and six months ended June 30, 2020 and June 30, 2019.

GMIB liabilities totaling $838 million as of June 30, 2020 and $688 million as of December 31, 2019 were reported in Accrued expenses and other liabilities and Other non-current liabilities. There were three reinsurers covering 100% of the GMIB exposures as of June 30, 2020 and December 31, 2019 as follows:

(In millions)
Line of Business	Reinsurer	June 30, 2020		December 31, 2019		Collateral and Other Terms at June 30, 2020
GMIB	Berkshire	$	404	$	332	100% were secured by assets in a trust.
	Sun Life Assurance Company of Canada	249		202
	Liberty Re (Bermuda) Ltd.	218		179		96% were secured by assets in a trust.
Total GMIB recoverables reported in Other current assets and Other assets		$	871	$	713

Amounts included in shareholders’ net income for GMIB assets and liabilities were not material for the three or six months ended June 30, 2020 or June 30, 2019.

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Note 11 – Investments

Cigna’s investment portfolio consists of a broad range of investments including debt securities, equity securities, commercial mortgage loans, policy loans, other long-term investments, short-term investments and derivative financial instruments. The sections below provide more detail regarding our investment balances and realized investment gains and losses. See Note 12 for information about the valuation of the Company’s investment portfolio. The following table summarizes the Company's investments by category and current or long-term classification.

	June 30, 2020						December 31, 2019
(In millions)	Current		Long-term		Total		Current		Long-term		Total
Debt securities	$	1,046	$	22,628	$	23,674	$	928	$	22,827	$	23,755
Equity securities	—		373		373		—		303		303
Commercial mortgage loans	—		1,942		1,942		—		1,947		1,947
Policy loans	—		1,364		1,364		—		1,357		1,357
Other long-term investments	—		2,900		2,900		—		2,403		2,403
Short-term investments	456		—		456		423		—		423
Total	$	1,502	$	29,207	$	30,709	$	1,351	$	28,837	$	30,188
Investments classified as assets of business held for sale(1)	(312)		(7,869)		(8,181)		(414)		(7,295)		(7,709)
Investments per Consolidated Balance Sheets	$	1,190	$	21,338	$	22,528	$	937	$	21,542	$	22,479
(1) The table above includes $8.2 billion as of June 30, 2020 and $7.7 billion as of December 31, 2019 of investments associated with the U.S. Group Disability and Life business that are held for sale to New York Life. Under the terms of the definitive agreement, some of the assets currently associated with the Group Disability and Life business can be substituted for other assets. The assets that will transfer to New York Life will be primarily debt securities and to a lesser extent commercial mortgage loans and short-term investments.

A.Investment Portfolio

Debt Securities

Accounting policy. Debt securities (including bonds, mortgage and other asset-backed securities and preferred stocks redeemable by the investor) are classified as available for sale and are carried at fair value with changes in fair value recorded either in Accumulated other comprehensive income (loss) within Shareholders’ equity or in credit loss expense based on fluctuations in the allowance for credit losses, as further discussed below. Net unrealized appreciation on debt securities supporting the Company’s run-off settlement annuity business is reported in Non-current insurance and contractholder liabilities rather than Accumulated other comprehensive income (loss). When the Company intends to sell or determines that it is more likely than not to be required to sell an impaired debt security, the excess of amortized cost over fair value is directly written down with a charge to Realized investment gains and losses.

As of January 1, 2020, the Company adopted ASU 2016-13 that included certain targeted improvements to the accounting for available-for-sale debt securities. The new guidance resulted in certain policy changes related to the process used by the Company to review declines in fair value from a security’s amortized cost basis to determine whether a credit loss exists. For example, the length of time that a debt security has been impaired is no longer a criterion for this review. In addition, under this new guidance, the Company recognizes an allowance for credit loss with a corresponding charge to credit loss expense, presented in Realized investment gains and losses in the Company’s income statement. Prior to this new guidance, the Company recorded a direct write-down of the instrument’s amortized cost basis. The allowance for credit loss represents the excess of amortized cost over the greater of its fair value or the net present value of the debt security's projected future cash flows (based on

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qualitative and quantitative factors, including the probability of default, and the estimated timing and amount of recovery). Each period, the allowance for credit loss is adjusted through credit loss expense.

The Company elected the expedient to not measure an allowance for credit losses for accrued interest receivables. Consistent with prior practice, when interest payments are delinquent based on contractual terms or when certain terms (interest rate or maturity date) of the investment have been restructured, accrued interest, reported in Other current assets, is written off through a charge to Net investment income, and interest income is recognized on a cash basis.

Debt securities are classified as either Current or Long-term investments based on their contractual maturities.

Review of declines in fair value. Management reviews impaired debt securities to determine whether a credit loss allowance is needed based on criteria that include:

•severity of decline;

•financial health and specific prospects of the issuer; and

•changes in the regulatory, economic or general market environment of the issuer’s industry or geographic region.

The amortized cost and fair value by contractual maturity periods for debt securities were as follows at June 30, 2020:

(In millions)	Amortized Cost		Fair Value
Due in one year or less	$	1,049	$	1,059
Due after one year through five years	7,298		7,593
Due after five years through ten years	8,751		9,582
Due after ten years	4,053		4,969
Mortgage and other asset-backed securities	475		471
Total	$	21,626	$	23,674

Actual maturities of these securities could differ from their contractual maturities used in the table above because issuers may have the right to call or prepay obligations, with or without penalties.

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Gross unrealized appreciation (depreciation) on debt securities by type of issuer is shown below.

(In millions)	Amortized Cost		Allowance for Credit Loss		Unrealized Appreciation		Unrealized Depreciation		Fair Value
June 30, 2020
Federal government and agency	$	415	$	—	$	222	$	—	$	637
State and local government	654		—		85		(2)		737
Foreign government	2,002		—		293		(9)		2,286
Corporate	18,080		(39)		1,663		(161)		19,543
Mortgage and other asset-backed	475		(9)		28		(23)		471
Total	$	21,626	$	(48)	$	2,291	$	(195)	$	23,674
Investments supporting liabilities of the Company’s run-off settlement annuity business (included in total above) (1)	$	2,209	$	(11)	$	803	$	(25)	$	2,976
December 31, 2019
Federal government and agency	$	498	$	—	$	235	$	—	$	733
State and local government	729		—		81		—		810
Foreign government	2,027		—		230		(1)		2,256
Corporate	18,149		—		1,299		(28)		19,420
Mortgage and other asset-backed	506		—		31		(1)		536
Total	$	21,909	$	—	$	1,876	$	(30)	$	23,755
Investments supporting liabilities of the Company’s run-off settlement annuity business (included in total above) (1)	$	2,229	$	—	$	740	$	(4)	$	2,965

(1)Net unrealized appreciation for these investments is excluded from accumulated other comprehensive income.

The table below summarizes debt securities with a decline in fair value from amortized cost by investment grade and the length of time these securities have been in an unrealized loss position. These debt securities are primarily corporate securities with a decline in fair value that reflects an increase in market yields since purchase. See discussion of Realized Investment Gains and Losses below for further information on the credit loss expense recorded for the Company's investments.

	June 30, 2020							December 31, 2019
(Dollars in millions)	Fair Value		Amortized Cost		Unrealized Depreciation		Number of Issues	Fair Value		Amortized Cost		Unrealized Depreciation		Number of Issues
One year or less
Investment grade	$	1,337	$	1,412	$	(75)	280	$	723	$	729	$	(6)	267
Below investment grade	$	968	$	1,055	$	(87)	831	$	340	$	348	$	(8)	355
More than one year
Investment grade	$	201	$	221	$	(20)	23	$	366	$	378	$	(12)	118
Below investment grade	$	75	$	88	$	(13)	35	$	84	$	88	$	(4)	93
Total	$	2,581	$	2,776	$	(195)	1,169	$	1,513	$	1,543	$	(30)	833

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The table below presents a roll-forward of the allowance for credit losses on debt securities for the six months ended June 30, 2020.

(In millions)	2020
Beginning balance, January 1, 2020	$	0
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	55
Balance at March 31, 2020	55
Second Quarter Activity:
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	25
Reductions for securities sold during the period	(9)
Net reductions to allowance for credit losses on securities that had an allowance recorded in a previous period	(23)
Ending balance, June 30, 2020	$	48

Equity Securities

Equity securities with a readily determinable fair value consist primarily of mutual funds that invest in fixed income debt securities. Equity securities without a readily determinable fair value consist of private equity investments and are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes. The amount of impairments or value changes resulting from observable price changes was not material as of June 30, 2020 and December 31, 2019. Hybrid equity securities consist of preferred stock investments that have call features.

The following table provides the values of the Company's equity security investments as of June 30, 2020 and December 31, 2019.

	June 30, 2020				December 31, 2019
(Dollars in millions)	Amortized Cost		Carrying Value		Amortized Cost		Carrying Value
Equity securities with readily determinable fair values	$	140	$	134	$	61	$	64
Equity securities with no readily determinable fair value	$	187	$	196	$	183	$	192
Hybrid equity securities	$	58	$	43	$	58	$	47
Total	$	385	$	373	$	302	$	303

Commercial Mortgage Loans

Accounting policy. Commercial mortgage loans are carried at unpaid principal balances. Beginning January 1, 2020 with the adoption of ASU 2016-13, unpaid principal balances are presented net of an allowance for expected credit losses. Changes in the allowance for expected credit losses are recognized as credit loss expense and presented in Realized investment gains and losses in the Company’s income statement. Each period, the Company establishes (or adjusts) its allowance for expected credit losses for commercial mortgage loans. The allowance for expected credit losses is based on a credit risk category that is assigned to each loan at origination using key credit quality indicators, including debt service coverage and loan-to-value ratios. Credit risk categories are updated as key credit quality indicators change. An expected loss rate, assigned based on the credit risk category, is applied to each loan's unpaid principal balance to develop an aggregate allowance for expected credit losses. Prior to adoption, impaired commercial mortgage loans were written down to the lower of unpaid principal or fair value of the underlying collateral when it became probable that the Company would not collect all amounts due under its promissory note. The Company recorded an allowance of $7 million through a cumulative effect adjustment to retained earnings to reflect expected credit losses at adoption. The credit loss allowance for the Company’s commercial mortgage loan investments was $8 million as of June 30, 2020.

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Commercial mortgage loans are considered impaired and written off against the allowance when it is probable that the Company will not collect all amounts due per the terms of the promissory note. The Company elected the expedient to not measure an allowance for credit losses for accrued interest receivables. Consistent with our prior practice, accrued interest, reported in other current assets, is written off through a charge to net investment income; interest income on impaired loans is only recognized when a payment is received.

In the event of a foreclosure, the allowance for credit losses is based on the excess of the carrying value of the mortgage loan over the fair value of its underlying collateral.

Mortgage loans held by the Company are made exclusively to commercial borrowers and are diversified by property type, location and borrower. Loans are generally issued at fixed rates of interest and are secured by high quality, primarily completed and substantially leased operating properties. Commercial mortgage loans are classified as either current or long-term investments based on their contractual maturities.

Credit quality. The Company regularly evaluates and monitors credit risk, beginning with the initial underwriting of a mortgage loan and continuing throughout the investment holding period. Mortgage origination professionals employ an internal credit quality rating system designed to evaluate the relative risk of the transaction at origination that is then updated each year as part of the annual portfolio loan review. The Company evaluates and monitors credit quality on a consistent and ongoing basis, classifying each loan as a loan in good standing, potential problem loan or problem loan.

Quality ratings are based on our evaluation of a number of key inputs related to the loan, including real estate market-related factors such as rental rates and vacancies, and property-specific inputs such as growth rate assumptions and lease rollover statistics. However, the two most significant contributors to the credit quality rating are the debt service coverage and loan-to-value ratios. The debt service coverage ratio measures the amount of property cash flow available to meet annual interest and principal payments on debt, with a ratio below 1.0 indicating that there is not enough cash flow to cover the required loan payments. The loan-to-value ratio, commonly expressed as a percentage, compares the amount of the loan to the fair value of the underlying property collateralizing the loan.

The following table summarizes the credit risk profile of the Company’s commercial mortgage loan portfolio based on loan-to-value and debt service coverage ratios as of June 30, 2020 and December 31, 2019:

(Dollars in millions)	June 30, 2020					December 31, 2019
Loan-to-Value Ratio	Carrying Value		Average Debt Service Coverage Ratio	Average Loan-to-Value Ratio		Carrying Value		Average Debt Service Coverage Ratio	Average Loan-to-Value Ratio
Below 60%	$	904	2.18			$	1,136	2.19
60% to 79%	903		1.94			723		1.98
80% to 100%	143		1.33			88		1.62
Allowance for credit losses	(8)
Total	$	1,942	2.01	60	%	$	1,947	2.09	58	%

The Company’s annual in-depth review of its commercial mortgage loan investments is the primary mechanism for identifying emerging risks in the portfolio. The Company’s investment professionals completed the annual in-depth review in the second quarter of 2020 that included an analysis of each underlying property’s most recent annual financial statements, rent rolls, operating plans, budgets, a physical inspection of the property and other pertinent factors. Based on historical results, current leases, lease expirations and rental conditions in each market, the Company estimated the current year and future stabilized property income and fair value for each loan. The average loan to value increased slightly from last year and remains strong. The portfolio's average debt service coverage ratio decreased slightly as June 30, 2020 compared with December 31, 2019 but remains at a high level.

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The Company re-evaluates a loan’s credit quality between annual reviews if new property information is received or an event such as delinquency or a borrower’s request for restructure causes management to believe that the Company’s estimate of financial performance, fair value or the risk profile of the underlying property has been impacted.

All commercial mortgage loans in the Company's portfolio are current as of June 30, 2020 and December 31, 2019.

Other Long-Term Investments

Other long-term investments include investments in unconsolidated entities, including certain limited partnerships and limited liability companies holding real estate, securities or loans. These investments are carried at cost plus the Company's ownership percentage of reporting income or loss, based on the financial statements of the underlying investments that are generally reported at fair value. Income or loss from these investments is reported on a one quarter lag due to the timing of when financial information is received from the general partner or manager of the investments.

Other long-term investments also include investment real estate, foreign currency swaps, and statutory and other deposits. The following table provides carrying value information for these investments.

	Carrying value as of
(In millions)	June 30, 2020		December 31, 2019
Real estate investments	$	850	$	788
Securities partnerships	1,525		1,409
Other	525		206
Total	$	2,900	$	2,403

Short-Term Investments and Cash Equivalents

Short-term investments and cash equivalents included the following types of issuers:

(In millions)	June 30, 2020		December 31, 2019
Corporate securities	$	4,266	$	1,985
Federal government securities	$	482	$	472
Foreign government securities	$	32	$	65
Money market funds	$	814	$	631

B.Realized Investment Gains and Losses

Accounting policy. Realized investment gains and losses are based on specifically identified assets and results from sales, investment asset write-downs, change in the fair value of certain derivatives and equity securities, and changes in valuation reserves on commercial mortgage loans. Commencing January 1, 2020, realized gains and losses also

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include credit loss expense resulting from the impact of changes in the allowances for credit losses on debt securities and commercial mortgage loan investments under ASU 2016-13.

The following realized gains and losses on investments exclude amounts required to adjust future policy benefits for the run-off settlement annuity business (consistent with accounting for a premium deficiency), as well as realized gains and losses attributed to the Company’s separate accounts because those gains and losses generally accrue directly to separate account policyholders.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Net realized investment gains, excluding credit loss expense and asset write-downs	$	33	$	25	$	9	$	36
Credit loss expense on invested assets	6		—		(49)		—
Other investment asset write-downs	(1)		(2)		(10)		(3)
Net realized investment gains (losses), before income taxes	$	38	$	23	$	(50)	$	33

Net realized investment gains, excluding credit loss expense and asset write-downs, for the six months ended June 30, 2020 primarily represent gains on the sales of debt securities, partially offset by mark-to-market losses on foreign exchange derivatives and equity securities. Net realized investment gains, excluding credit loss expense and asset write-downs, for the six months ended June 30, 2019 represent mark-to-market gains on equity securities and gains on the sales of debt securities and real estate partnerships. Credit loss expense on invested assets for the six months ended June 30, 2020 reflects credit losses incurred on debt securities due to uncertainty around issuers in certain industries that are particularly impacted by the global COVID-19 pandemic. Realized gains and losses on equity securities still held at June 30, 2020 and 2019 were not material.

The following table presents sales information for available-for-sale debt securities. Gross gains on sales and gross losses on sales exclude amounts required to adjust future policy benefits for the run-off settlement annuity business.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Proceeds from sales	$	880	$	565	$	1,623	$	1,651
Gross gains on sales	$	27	$	9	$	66	$	23
Gross losses on sales	$	(14)	$	(2)	$	(21)	$	(12)

C.Derivative Financial Instruments

The Company uses derivative financial instruments to manage the characteristics of investment assets (such as duration, yield, currency and liquidity) to meet the varying demands of the related insurance and contract holder liabilities. The Company also uses derivative financial instruments to hedge the risk of changes in the net assets of certain of its foreign subsidiaries due to changes in foreign currency exchange rates. The Company has written and purchased GMIB reinsurance contracts in its run-off reinsurance business that are accounted for as freestanding derivatives as discussed in Note 10. Derivatives in the Company’s separate accounts are excluded from the following discussion because associated gains and losses generally accrue directly to separate account policyholders.

Derivative instruments used by the Company typically include foreign currency swap contracts and foreign currency forward contracts. Foreign currency swap contracts periodically exchange cash flows between two currencies for principal and interest. Foreign currency forward contracts require the Company to purchase a foreign currency in

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exchange for the functional currency of its operating unit at a future date, generally within three months from the contracts’ trade dates.

The Company manages the credit risk of these derivative instruments by diversifying its portfolio among approved dealers of high credit quality and through routine monitoring of credit risk exposures. Certain of the Company’s over-the-counter derivative instruments require either the Company or the counterparty to post collateral or demand immediate payment depending on the amount of the net liability position of the derivative instrument and predefined financial strength or credit rating thresholds. These collateral posting requirements vary by counterparty. The Company would incur a loss if dealers completely failed to perform under derivative contracts, however collateral has been posted by dealers to cover substantially all of the fair values owed by dealers at June 30, 2020 and December 31, 2019. The fair value of collateral posted by the Company was not significant as of June 30, 2020 or December 31, 2019.

The gross fair values of our derivative financial instruments are presented in Note 12. The following table summarizes the types and notional quantity of derivative instruments held by the Company. As of June 30, 2020 and December 31, 2019, the effects of these individual hedging strategies were not material to the Consolidated Financial Statements, including gains or losses reclassified from accumulated other comprehensive income into shareholders' net income, as well as amounts excluded from the assessment of hedge effectiveness.

	(In millions)	Notional Value as of
		June 30, 2020		December 31, 2019
Purpose	Type of Instrument
Fair value hedge: To hedge the foreign exchange-related changes in fair values of certain foreign-denominated bonds. The notional value of these derivatives matches the amortized cost of the hedged bonds.	Foreign currency swap contracts	$	817	$	817
Net investment hedge: To reduce the risk of changes in net assets due to changes in foreign currency spot exchange rates for certain foreign subsidiaries that conduct their business principally in Euros, Korean Won, and Taiwan Dollar. The notional value of hedging instruments matches the hedged amount of subsidiary net assets.	Foreign currency swap contracts	$	526	$	438
	Foreign currency forward contracts	$	606	$	406
Economic hedge: To hedge the foreign exchange-related changes in fair value of a U.S. dollar-denominated bond portfolio to reflect the local currency for the Company’s foreign subsidiary in South Korea. The notional value of hedging instruments generally aligns with the fair value of the hedged bond portfolio.	Foreign currency forward contracts	$	442	$	410

The Company’s derivative financial instruments are presented as follows: 

•Fair value hedges of the foreign exchange-related changes in fair values of certain foreign-denominated bonds: Swap fair values are reported in Long-term investments or Other non-current liabilities. Changes in fair values attributable to foreign exchange risk of the swap contracts and the hedged bonds are reported in Realized investment gains and losses. The portion of the swap contracts’ changes in fair value excluded from the assessment of hedge effectiveness is recorded in Other comprehensive income and recognized in Net investment income as swap coupon payments are accrued, offsetting the foreign-denominated coupons received on the designated bonds. Net cash flows are reported in Operating activities, while exchanges of notional principal amounts are reported in Investing activities.

•Net investment hedges of certain foreign subsidiaries that conduct their business principally in currencies other than the U.S. dollar: The fair values of the foreign currency swap and forward contracts are reported in Other assets or Other liabilities. The changes in fair values of these instruments are reported in Other comprehensive income, specifically in translation of foreign currencies. The portion of the change in fair values relating to foreign exchange spot rates will be recognized in earnings upon deconsolidation of the

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hedged foreign subsidiaries. The remaining changes in fair value of these instruments are excluded from our effectiveness assessment and recognized in interest expense when coupon payments are accrued or ratably over the term of the instrument. The notional value of hedging instruments matches the hedged amount of subsidiary net assets. Cash flows relating to these contracts are reported in Investing activities.

•Economic hedges for derivatives not designated as accounting hedges: Fair values of forward contracts are reported in current Investments or Accrued expenses and other liabilities. The changes in fair values are reported in Realized investment gains and losses. Cash flows relating to these contracts are reported in Investing activities.

Note 12 – Fair Value Measurements

The Company carries certain financial instruments at fair value in the financial statements including debt securities, certain equity securities, short-term investments and derivatives. Other financial instruments are measured at fair value only under certain conditions, such as when impaired or when there are observable price changes for equity securities with no readily determinable fair value.

Fair value is defined as the price at which an asset could be exchanged in an orderly transaction between market participants at the balance sheet date. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a market participant, not the amount that would be paid to settle the liability with the creditor.

The Company’s financial assets and liabilities carried at fair value have been classified based upon a hierarchy defined by GAAP. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset’s or a liability’s classification is based on the lowest level of input that is significant to its measurement. For example, a financial asset or liability carried at fair value would be classified in Level 3 if unobservable inputs were significant to the instrument’s fair value, even though the measurement may be derived using inputs that are both observable (Levels 1 and 2) and unobservable (Level 3).

The Company estimates fair values using prices from third parties or internal pricing methods. Fair value estimates received from third-party pricing services are based on reported trade activity and quoted market prices when available, and other market information that a market participant would use to estimate fair value. The internal pricing methods are performed by the Company’s investment professionals and generally involve using discounted cash flow analyses, incorporating current market inputs for similar financial instruments with comparable terms and credit quality as well as other qualitative factors. In instances where there is little or no market activity for the same or similar instruments, fair value is estimated using methods, models and assumptions that the Company believes a hypothetical market participant would use to determine a current transaction price. These valuation techniques involve some level of estimation and judgment that becomes significant with increasingly complex instruments or pricing models.

The Company is responsible for determining fair value and for assigning the appropriate level within the fair value hierarchy based on the significance of unobservable inputs. The Company reviews methodologies, processes and controls of third-party pricing services and compares prices on a test basis to those obtained from other external pricing sources or internal estimates. The Company performs ongoing analyses of both prices received from third-party pricing services and those developed internally to determine that they represent appropriate estimates of fair value. The controls executed by the Company include evaluating changes in prices and monitoring for potentially stale valuations. The Company also performs sample testing of sales values to confirm the accuracy of prior fair value estimates. The minimal exceptions identified during these processes indicate that adjustments to prices are

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infrequent and do not significantly impact valuations. We conduct an annual on-site visit of the most significant pricing service to review their processes, methodologies and controls. This on-site review includes a walk-through of inputs for a sample of securities held across various asset types to validate the documented pricing process.

A.Financial Assets and Financial Liabilities Carried at Fair Value

The following table provides information as of June 30, 2020 and December 31, 2019 about the Company’s financial assets and liabilities carried at fair value. Separate account assets are also recorded at fair value on the Company’s Consolidated Balance Sheets and are reported separately in the Separate Accounts section below as gains and losses related to these assets generally accrue directly to policyholders.

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
	As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019
Financial assets at fair value
Debt securities
Federal government and agency	$	192	$	197	$	445	$	536	$	—	$	—	$	637	$	733
State and local government	—		—		737		810		—		—		737		810
Foreign government	—		—		2,260		2,228		26		28		2,286		2,256
Corporate	—		—		18,889		19,063		654		357		19,543		19,420
Mortgage and other asset-backed	—		—		322		398		149		138		471		536
Total debt securities	192		197		22,653		23,035		829		523		23,674		23,755
Equity securities (1)	1		7		145		72		31		32		177		111
Short-term investments	—		—		456		423		—		—		456		423
Derivative assets	—		—		193		83		—		—		193		83
Real estate funds priced at NAV as a practical expedient (2)													168		184
Financial liabilities at fair value
Derivative liabilities	$	—	$	—	$	15	$	18	$	—	$	—	$	15	$	18

(1)Excludes certain equity securities that have no readily determinable fair value.

(2)As a practical expedient, certain real estate funds are carried at fair value based on the Company’s ownership share of the equity of the investee (Net Asset Value (“NAV“)) including changes in the fair value of its underlying investments. The Company has $55 million in unfunded commitments in these funds as of June 30, 2020.

Level 1 Financial Assets

Inputs for instruments classified in Level 1 include unadjusted quoted prices for identical assets in active markets accessible at the measurement date. Active markets provide pricing data for trades occurring at least weekly and include exchanges and dealer markets.

Assets in Level 1 include actively-traded U.S. government bonds and exchange-listed equity securities. A relatively small portion of the Company’s investment assets are classified in this category given the narrow definition of Level 1 and the Company’s investment asset strategy to maximize investment returns.

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Level 2 Financial Assets and Financial Liabilities

Inputs for instruments classified in Level 2 include quoted prices for similar assets or liabilities in active markets, quoted prices from those willing to trade in markets that are not active or other inputs that are market observable or can be corroborated by market data for the term of the instrument. Such other inputs include market interest rates and volatilities, spreads and yield curves. An instrument is classified in Level 2 if the Company determines that unobservable inputs are insignificant.

Debt and equity securities. Approximately 95% of the Company’s investments in debt and equity securities are classified in Level 2 including most public and private corporate debt and hybrid equity securities, federal agency and municipal bonds, non-government mortgage-backed securities and preferred stocks. Third-party pricing services and internal methods often use recent trades of securities with similar features and characteristics because many debt securities do not trade daily. Pricing models are used to determine these prices when recent trades are not available. These models calculate fair values by discounting future cash flows at estimated market interest rates. Such market rates are derived by calculating the appropriate spreads over comparable U.S. Treasury securities based on the credit quality, industry and structure of the asset. Typical inputs and assumptions to pricing models include, but are not limited to, a combination of benchmark yields, reported trades, issuer spreads, liquidity, benchmark securities, bids, offers, reference data and industry and economic events. For mortgage-backed securities, inputs and assumptions may also include characteristics of the issuer, collateral attributes, prepayment speeds and credit rating.

Nearly all of these instruments are valued using recent trades or pricing models. Less than 1% of the fair value of investments classified in Level 2 represents foreign bonds that are valued using a single, unadjusted market-observable input derived by averaging multiple broker-dealer quotes, consistent with local market practice.

Short-term investments are carried at fair value that approximates cost. The Company compares market prices for these securities to recorded amounts on a regular basis to validate that current carrying amounts approximate exit prices. The short-term nature of the investments and corroboration of the reported amounts over the holding period support their classification in Level 2.

Derivative assets and liabilities classified in Level 2 represent over-the-counter instruments such as foreign currency forward and swap contracts. Fair values for these instruments are determined using market observable inputs including forward currency and interest rate curves and widely published market observable indices. Credit risk related to the counterparty and the Company is considered when estimating the fair values of these derivatives. However, the Company is largely protected by collateral arrangements with counterparties and determined that no adjustments for credit risk were required as of June 30, 2020 or December 31, 2019. The nature and use of these derivative financial instruments are described in Note 11.

Level 3 Financial Assets and Financial Liabilities

Certain inputs for instruments classified in Level 3 are unobservable (supported by little or no market activity) and significant to their resulting fair value measurement. Unobservable inputs reflect the Company’s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date.

The Company classifies certain newly-issued, privately-placed, complex or illiquid securities in Level 3. Approximately 4% of debt and equity securities are priced using significant unobservable inputs and classified in this category.

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Fair values of mortgage and other asset-backed securities, as well as corporate and government debt securities, are primarily determined using pricing models that incorporate the specific characteristics of each asset and related assumptions including the investment type and structure, credit quality, industry and maturity date in comparison to current market indices, spreads and liquidity of assets with similar characteristics. Inputs and assumptions for pricing may also include characteristics of the issuer, collateral attributes and prepayment speeds for mortgage and other asset-backed securities. Recent trades in the subject security or similar securities are assessed when available, and the Company may also review published research in its evaluation, as well as the issuer’s financial statements.

Quantitative Information about Unobservable Inputs

The following table summarizes the fair value and significant unobservable inputs used in pricing the following debt securities that were developed directly by the Company as of June 30, 2020 and December 31, 2019. The range and weighted average basis point (“bps”) amounts for liquidity and credit spreads (adjustment to discount rates) reflect the Company’s best estimates of the unobservable adjustments a market participant would make to calculate these fair values. These inputs have increased over the reported periods, resulting from continued uncertainty over the economic impacts related to COVID-19.

Corporate and government debt securities. The significant unobservable input used to value the following corporate and government debt securities is an adjustment for liquidity. This adjustment is needed to reflect current market conditions and issuer circumstances when there is limited trading activity for the security.

Mortgage and other asset-backed securities. The significant unobservable inputs used to value the following mortgage and other asset-backed securities are liquidity and weighting of credit spreads. An adjustment for liquidity is made as of the measurement date that considers current market conditions, issuer circumstances and complexity of the security structure when there is limited trading activity for the security. An adjustment to weight credit spreads is needed to value a more complex bond structure with multiple underlying collateral and no standard market valuation technique. The weighting of credit spreads is primarily based on the underlying collateral’s characteristics and their proportional cash flows supporting the bond obligations.

	Fair Value as of					Unobservable Adjustment Range (Weighted Average by Quantity) as of
(Fair value in millions )	June 30, 2020		December 31, 2019		Unobservable input June 30, 2020	June 30, 2020	December 31, 2019
Debt securities
Corporate and government debt securities	$	678	$	385	Liquidity	70 - 1700 (390) bps	70 - 930 (280) bps
Mortgage and other asset-backed securities	149		138		Liquidity	60 - 370 (70) bps	60 - 370 (70) bps
					Weighting of credit spreads	310 - 620 (440) bps	240 - 460 (330) bps
Securities not priced by the Company (1)	2		—
Total Level 3 debt securities	$	829	$	523

(1)The fair values for these securities use single, unadjusted non-binding broker quotes not developed directly by the Company.

Significant increases in liquidity or credit spreads would result in lower fair value measurements while decreases in these inputs would result in higher fair value measurements. The unobservable inputs are generally not interrelated and a change in the assumption used for one unobservable input is not accompanied by a change in the other unobservable input.

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Changes in Level 3 Financial Assets and Financial Liabilities Carried at Fair Value

The following tables summarize the changes in financial assets and financial liabilities classified in Level 3 for the three and six months ended June 30, 2020 and 2019. Gains and losses reported in these tables may include net changes in fair value that are attributable to both observable and unobservable inputs.

Debt and Equity Securities
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Balance at beginning of period	$	766	$	436	$	555	$	410
Total gains (losses) included in shareholders’ net income	17		—		5		(1)
Gains (losses) included in other comprehensive income	12		5		(59)		12
Gains (losses) required to adjust future policy benefits for settlement annuities (1)	7		—		(3)		2
Purchases, sales and settlements
Purchases	2		43		64		43
Sales	—		—		(12)		—
Settlements	(5)		(9)		(7)		(10)
Total purchases, sales and settlements	$	(3)	$	34	$	45	$	33
Transfers into/(out of) Level 3
Transfers into Level 3	179		13		527		33
Transfers out of Level 3	(118)		(57)		(210)		(58)
Total transfers into/(out of) Level 3	$	61	$	(44)	$	317	$	(25)
Balance at June 30,	$	860	$	431	$	860	$	431
Total gains (losses) included in shareholders’ net income attributable to instruments held at the reporting date	$	16	$	(1)	$	(1)	$	(1)
Change in unrealized gains or losses included in other comprehensive income for assets held at the end of the reporting period	$	12	N/A		$	(54)	N/A

(1)Amounts do not accrue to shareholders.

Total gains and losses included in Shareholders’ net income in the tables above are reflected in the Consolidated Statements of Income as Net realized investment gains (losses) and Net investment income.

Gains and losses included in Other comprehensive income in the tables above are reflected in Net unrealized appreciation (depreciation) on securities in the Consolidated Statements of Comprehensive Income.

Transfers into or out of the Level 3 category occur when unobservable inputs, such as the Company’s best estimate of what a market participant would use to determine a current transaction price, become more or less significant to the fair value measurement. Transfers between Level 2 and Level 3 during 2020 and 2019 primarily reflected changes in liquidity and credit risk estimates for certain private placement issuers across several sectors.

Separate Accounts

The investment income and fair value gains and losses of separate account assets generally accrue directly to the contractholders and, together with their deposits and withdrawals, are excluded from the Company’s Consolidated Statements of Income and Cash Flows.

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Fair values of separate account assets at June 30, 2020 and December 31, 2019 were as follows:

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
	June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019
Guaranteed separate accounts (See Note 18)	$	203	$	219	$	298	$	271	$	—	$	—	$	501	$	490
Non-guaranteed separate accounts (1)	1,485		1,450		5,228		5,522		334		263		7,047		7,235
Subtotal	$	1,688	$	1,669	$	5,526	$	5,793	$	334	$	263	$	7,548	$	7,725
Non-guaranteed separate accounts priced at NAV as a practical expedient (1)													727		756
Total													$	8,275	$	8,481
Separate account assets of business classified as held for sale													(14)		(16)
Separate account assets per Consolidated Balance Sheets													$	8,261	$	8,465

(1)Non-guaranteed separate accounts included $3.9 billion as of June 30, 2020 and $4.0 billion as of December 31, 2019 in assets supporting the Company’s pension plans, including $0.3 billion classified in Level 3 as of June 30, 2020 and $0.2 billion classified in Level 3 as of December 31, 2019.

Separate account assets classified as Level 1 primarily include exchange-listed equity securities. Level 2 assets primarily include:

•corporate and structured bonds valued using recent trades of similar securities or pricing models that discount future cash flows at estimated market interest rates as described above; and

•actively-traded institutional and retail mutual fund investments.

Separate account assets classified in Level 3 primarily support Cigna’s pension plans and include certain newly-issued, privately-placed, complex, or illiquid securities that are priced using methods discussed above, as well as commercial mortgage loans. Activity, including transfers into and out of Level 3, was not material for the three and six months ended June 30, 2020 and 2019.

Separate account investments in securities partnerships, real estate, and hedge funds are generally valued based on the separate account’s ownership share of the equity of the investee (NAV as a practical expedient) including changes in the fair values of its underlying investments. Substantially all of these assets support the Cigna Pension Plans. The following table provides additional information on these investments.

	Fair Value as of				Unfunded Commitment as of June 30, 2020		Redemption Frequency (if currently eligible)	Redemption Notice Period
(In millions)	June 30, 2020		December 31, 2019
Securities partnerships	$	499	$	531	$	314	Not applicable	Not applicable
Real estate funds	224		220		—		Quarterly	30 - 90 days
Hedge funds	4		5		—		Up to annually, varying by fund	30 - 90 days
Total	$	727	$	756	$	314

As of June 30, 2020, the Company does not have plans to sell any of these assets at less than fair value. These investments are structured to satisfy longer-term investment objectives. Securities partnerships are contractually

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unredeemable, and the underlying investment assets are expected to be liquidated by the fund managers within ten years after inception.

B.Assets and Liabilities Measured at Fair Value under Certain Conditions

Some financial assets and liabilities are not carried at fair value each reporting period, but may be measured using fair value only under certain conditions such as when investments become impaired, including investment real estate and commercial mortgage loans and certain equity securities with no readily determinable fair value. Equity securities with no readily determinable fair value are also measured at fair value when there are observable price changes from orderly transactions with the same issuer. For the six months ended June 30, 2020, there were immaterial losses relating to price changes for equity securities with no readily determinable fair value and no impaired investments written down to their fair values. For the six months ended June 30, 2019, there were immaterial gains relating to price changes for equity securities with no readily determinable fair value and no impaired investments written down to their fair values . Carrying values represented less than 1% of total investments as of both June 30, 2020 and June 30, 2019.

C.Fair Value Disclosures for Financial Instruments Not Carried at Fair Value

The following table includes the Company’s financial instruments not recorded at fair value that are subject to fair value disclosure requirements at June 30, 2020 and December 31, 2019. In addition to universal life products and finance leases, financial instruments that are carried in the Company’s Consolidated Financial Statements at amounts that approximate fair value are excluded from the following table.

		June 30, 2020				December 31, 2019
(In millions)	Classification in Fair Value Hierarchy	Fair Value		Carrying Value		Fair Value		Carrying Value
Commercial mortgage loans	Level 3	$	1,990	$	1,942	$	1,989	$	1,947
Long-term debt, including current maturities, excluding finance leases	Level 2	$	40,310	$	35,054	$	39,439	$	36,375

Fair values of off-balance sheet financial instruments were not material as of June 30, 2020 and December 31, 2019.

Note 13 – Variable Interest Entities

When the Company becomes involved with a variable interest entity and when there is a change in the Company’s involvement with an entity, the Company must determine if it is the primary beneficiary and must consolidate the entity. The Company is considered the primary beneficiary if it has the power to direct the entity’s most significant economic activities and has the right to receive benefits or obligation to absorb losses that could be significant to the entity. The Company evaluates the following criteria:

•the structure and purpose of the entity;

•the risks and rewards created by, and shared through, the entity; and

•the Company’s ability to direct its activities, receive its benefits and absorb its losses relative to the other parties involved with the entity including its sponsors, equity holders, guarantors, creditors and servicers.

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The Company determined it was not a primary beneficiary in any material variable interest entities as of June 30, 2020 or December 31, 2019. The Company’s involvement in variable interest entities for which it is not the primary beneficiary is described below.

Securities limited partnerships and real estate limited partnerships. The Company owns interests in securities limited partnerships and real estate limited partnerships that are defined as variable interest entities. These partnerships invest in the equity or mezzanine debt of privately-held companies and real estate properties. General partners unaffiliated with the Company control decisions that most significantly impact the partnership’s operations and the limited partners do not have substantive kick-out or participating rights. The Company’s maximum exposure to loss from these entities of $3.8 billion across approximately 150 limited partnerships as of June 30, 2020, included $1.9 billion reported in Long-term investments and commitments to contribute an additional $1.9 billion. The Company’s noncontrolling interest in each of these limited partnerships is generally less than 15% of the partnership ownership interests.

Other asset-backed and corporate securities. In the normal course of its investing activities, the Company also makes passive investments in certain asset-backed and corporate securities that are issued by variable interest entities whose sponsors or issuers are unaffiliated with the Company. The Company receives fixed-rate cash flows from these investments and the maximum potential exposure to loss is limited to our carrying amount of $0.7 billion as of June 30, 2020 that is reported in debt securities. The Company’s combined ownership interests are insignificant relative to the total principal amounts issued by these entities.

The Company is involved with various other variable interest entities with immaterial carrying values and maximum exposures to loss.

The Company has not provided, and does not intend to provide, financial support to any of the variable interest entities beyond what it is contractually required to provide. The Company performs ongoing qualitative analyses of its involvement with these variable interest entities to determine if consolidation is required.

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Note 14 – Accumulated Other Comprehensive Income (Loss) (“AOCI”)

AOCI includes unrealized appreciation on securities and derivatives (excluding appreciation on investments supporting future policy benefit liabilities of the run-off settlement annuity business) (See Note 11), foreign currency translation and the net postretirement benefits liability adjustment. AOCI includes the Company’s share from unconsolidated entities reported on the equity method. Generally, tax effects in AOCI are established at the currently enacted tax rate and reclassified to net income in the same period that the related pre-tax AOCI reclassifications are recognized. Changes in the components of AOCI were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Securities and Derivatives
Beginning balance	$	547	$	460	$	975	$	18
Appreciation on securities and derivatives	920		442		340		1,007
Tax (expense)	(197)		(94)		(69)		(216)
Net appreciation on securities and derivatives	723		348		271		791
Reclassification adjustment for losses (gains) included in shareholders' net income (net realized investment losses (gains))	(19)		(6)		13		(7)
Tax (expense) benefit	5		1		(3)		1
Net losses (gains) reclassified from AOCI to net income	(14)		(5)		10		(6)
Other comprehensive income, net of tax	709		343		281		785
Ending balance	$	1,256	$	803	$	1,256	$	803
Translation of foreign currencies
Beginning balance	$	(446)	$	(245)	$	(275)	$	(221)
Translation of foreign currencies	65		(42)		(95)		(67)
Tax (expense) benefit	5		—		(10)		(1)
Net translation of foreign currencies	70		(42)		(105)		(68)
Less: Net translation of foreign currencies attributable to noncontrolling interests	(2)		(2)		(6)		(4)
Shareholders' net translation of foreign currencies	72		(40)		(99)		(64)
Ending balance	$	(374)	$	(285)	$	(374)	$	(285)
Postretirement benefits liability
Beginning balance	$	(1,628)	$	(1,497)	$	(1,641)	$	(1,508)
Reclassification adjustment for amortization of net losses from past experience and prior service costs (interest expense and other)	18		16		36		31
Reclassification adjustment for settlement (interest expense and other)	—		—		—		10
Tax (expense) benefit	(4)		5		(9)		(9)
Net adjustments reclassified from AOCI to net income	14		21		27		32
Valuation update	(73)		(8)		(73)		(8)
Tax benefit	17		1		17		1
Net change due to valuation update	(56)		(7)		(56)		(7)
Other comprehensive (loss) income, net of tax	(42)		14		(29)		25
Ending balance	$	(1,670)	$	(1,483)	$	(1,670)	$	(1,483)

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Note 15 - Organizational Efficiency Plan

The Company is continuously evaluating ways to deliver our products and services more efficiently and at a lower cost. During the fourth quarter of 2019, we committed to a plan to increase our organizational alignment and operational efficiency and reduce costs. As a result, we recognized a charge in Selling, general and administrative expenses of $207 million pre-tax ($162 million after-tax) in the fourth quarter of 2019 and an additional $31 million pre-tax ($24 million after-tax) in the first quarter 2020, primarily for severance costs related to headcount reductions. As of June 30, 2020 we expect most of the severance to be paid by the end of 2021.

Note 16 – Leases

Operating and finance lease right of use ("ROU") assets and lease liabilities were as follows:

(In millions)	June 30, 2020		December 31, 2019
Operating leases:
Operating lease ROU assets	$	544	$	536
Accrued expenses and other current liabilities	$	158	$	166
Other non-current liabilities	482		465
Total operating lease liabilities	$	640	$	631
Finance leases:
Property and equipment, gross	$	98	$	110
Accumulated depreciation	(35)		(23)
Property and equipment, net	$	63	$	87
Short-term debt	$	22	$	27
Long-term debt	43		61
Total finance lease liabilities	$	65	$	88

Note 17 – Income Taxes

Income Tax Expense

The 20.0% effective tax rate for the six months ended June 30, 2020 was lower than the 21.5% rate for the same period in 2019. This decrease is primarily attributable to incremental tax benefits including the remeasurement of deferred state income taxes and the settlement of uncertain tax positions. This decrease was partially offset by return of the nondeductible health insurer tax.

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Note 18 – Contingencies and Other Matters

The Company, through its subsidiaries, is contingently liable for various guarantees provided in the ordinary course of business.

A.Financial Guarantees: Retiree and Life Insurance Benefits

The Company guarantees that separate account assets will be sufficient to pay certain life insurance or retiree benefits. For the majority of these benefits, the sponsoring employers are primarily responsible for ensuring that assets are sufficient to pay these benefits and are required to maintain assets that exceed a certain percentage of benefit obligations. If employers fail to do so, the Company or an affiliate of the buyer of the retirement benefits business has the right to redirect the management of the related assets to provide for benefit payments. As of June 30, 2020, employers maintained assets that exceeded the benefit obligations under these arrangements of approximately $455 million. An additional liability is established if management believes that the Company will be required to make payments under the guarantees; there were no additional liabilities required for these guarantees, net of reinsurance, as of June 30, 2020. Separate account assets supporting these guarantees are classified in Levels 1 and 2 of the GAAP fair value hierarchy.

The Company does not expect that these financial guarantees will have a material effect on the Company’s consolidated results of operations, liquidity or financial condition.

B.Certain Other Guarantees

The Company had indemnification obligations as of June 30, 2020 in connection with acquisition and disposition transactions. These indemnification obligations are triggered by the breach of representations or covenants provided by the Company, such as representations for the presentation of financial statements, filing of tax returns, compliance with law or identification of outstanding litigation. These obligations are typically subject to various time limitations, defined by the contract or by operation of law, such as statutes of limitation. In some cases, the maximum potential amount due is subject to contractual limitations based on a percentage of the transaction purchase price, while in other cases limitations are not specified or applicable. The Company does not believe that it is possible to determine the maximum potential amount due under these obligations because not all amounts due under these indemnification obligations are subject to limitation. There were no liabilities for these indemnification obligations as of June 30, 2020.

C.Guaranty Fund Assessments

The Company operates in a regulatory environment that may require its participation in assessments under state insurance guaranty association laws. The Company’s exposure to assessments for certain obligations of insolvent insurance companies to policyholders and claimants is based on its share of business written in the relevant jurisdictions.

There were no material effects for existing or new guaranty fund assessments for the six months ended June 30, 2020.

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D.Legal and Regulatory Matters

The Company is routinely involved in numerous claims, lawsuits, regulatory inquiries and audits, government investigations, including under the federal False Claims Act and state false claims acts initiated by a government investigating body or by a qui tam relator’s filing of a complaint under court seal, and other legal matters arising, for the most part, in the ordinary course of managing a global health service business. Additionally, the Company has received and is cooperating with subpoenas or similar processes from various governmental agencies requesting information, all arising in the normal course of its business. Disputed tax matters arising from audits by the Internal Revenue Service or other state and foreign jurisdictions, including those resulting in litigation, are accounted for under GAAP guidance for uncertain tax positions. Further information on income tax matters can be found in Note 17.

Pending litigation and legal or regulatory matters that the Company has identified with a reasonably possible material loss and certain other material litigation matters are described below. For those matters that the Company has identified with a reasonably possible material loss, the Company provides disclosure in the aggregate of accruals and range of loss, or a statement that such information cannot be estimated. The Company’s accruals for the matters discussed below under “Litigation Matters” and "Regulatory Matters" are immaterial. Due to numerous uncertain factors presented in these cases, it is not possible to estimate an aggregate range of loss (if any) for these matters at this time. In light of the uncertainties involved in these matters, there is no assurance that their ultimate resolution will not exceed the amounts currently accrued by the Company. An adverse outcome in one or more of these matters could be material to the Company’s results of operations, financial condition or liquidity for any particular period. The outcomes of lawsuits are inherently unpredictable and we may be unsuccessful in these ongoing litigation matters or any future claims or litigation.

Litigation Matters

Risk Corridors and CSR Litigation with the Federal Government. As a result of the Supreme Court decision in April 2020, the Company filed suit in early May against the United States in the U.S. Court of Federal Claims seeking to recover two types of payments the Federal Government owes Cigna under the risk corridors and cost-sharing reduction (“CSR”) programs of the ACA. In aggregate, the complaint seeks to recover more than $315 million: $120 million in risk corridors payments and more than $195 million in CSR payments. Cigna’s complaint is pending and we await the Federal Government’s response.

Cigna Litigation with Anthem. In February 2017, the Company delivered a notice to Anthem terminating the 2015 merger agreement and notifying Anthem that it must pay the Company the $1.85 billion reverse termination fee pursuant to the terms of the merger agreement. Also in February 2017, the Company filed suit against Anthem in the Delaware Court of Chancery (the “Chancery Court”) seeking declaratory judgments that the Company’s termination of the merger agreement was valid and that Anthem was not permitted to extend the termination date. The complaint also sought payment of the reverse termination fee and additional damages in an amount exceeding $13 billion, including the lost premium value to the Company’s shareholders caused by Anthem’s willful breaches of the merger agreement. Anthem has countersued, alleging its own claims for damages.

On February 15, 2017, the Chancery Court granted Anthem’s motion for a temporary restraining order and temporarily enjoined the Company from terminating the merger agreement. In May 2017, the Chancery Court denied Anthem’s motion for a preliminary injunction to enjoin Cigna from terminating the merger agreement but stayed its ruling pending Anthem’s determination as to whether to seek an appeal. Anthem subsequently notified Cigna and the Chancery Court that it did not intend to appeal the Chancery Court’s decision. As a result, the merger agreement was terminated.

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The litigation between the parties remains pending. A trial was held during the first quarter of 2019. Oral arguments on post-trial briefs were held on November 26, 2019. In February 2020, the Chancery Court requested additional post-trial briefing, which has been completed. In June 2020, the Company was notified by the Chancery Court that its decision had been delayed, due in part to COVID-19 complexities. We believe in the merits of our claims and dispute Anthem’s claims, and we intend to vigorously defend ourselves and pursue our claims.

Express Scripts Litigation with Anthem. In March 2016, Anthem filed a lawsuit in the United States District Court for the Southern District of New York alleging various breach of contract claims against Express Scripts relating to the parties’ rights and obligations under the periodic pricing review section of the pharmacy benefit management agreement between the parties including allegations that Express Scripts failed to negotiate new pricing concessions in good faith, as well as various alleged service issues. Anthem also requested that the court enter declaratory judgment that Express Scripts is required to provide Anthem competitive benchmark pricing, that Anthem can terminate the agreement, and that Express Scripts is required to provide Anthem with post-termination services at competitive benchmark pricing for one year following any termination by Anthem. Anthem claims it is entitled to $13 billion in additional pricing concessions over the remaining term of the agreement, as well as $1.8 billion for one year following any contract termination by Anthem and $150 million damages for service issues (“Anthem’s Allegations”). On April 19, 2016, in response to Anthem’s complaint, Express Scripts filed its answer denying Anthem’s Allegations in their entirety and asserting affirmative defenses and counterclaims against Anthem. The court subsequently granted Anthem’s motion to dismiss two of six counts of Express Scripts’ amended counterclaims. The current scheduling order runs through the completion of summary judgment briefing in March 2021. There is no tentative trial date. We believe in the merits of our claims and dispute Anthem’s claims, and we intend to vigorously defend ourselves and pursue our claims.

Regulatory Matters

Civil Investigative Demand. The U.S. Department of Justice (“DOJ”) is conducting an industry-wide investigation of Medicare Advantage organizations’ risk adjustment practices under Medicare Parts C and D including medical chart reviews and health exams. For certain other Medicare Advantage organizations, the investigation has resulted in litigation. The Company is currently responding to information requests (civil investigative demands) received from the DOJ (U.S. Attorney’s Offices for the Eastern District of Pennsylvania and the Southern District of New York). We will continue to cooperate with the DOJ’s investigation.

Disability claims regulatory matter. The Company is subject to an agreement with the Departments of Insurance for Maine, Massachusetts, Pennsylvania, Connecticut and California (together, the “Lead States”), originally entered into in 2013, that relates to the Company’s long-term disability claims handling practices. The agreement provides for enhanced procedures related to documentation and disposition. Cigna has cooperated fully with the Lead States and we believe we have addressed the requirements of the agreement. The Lead States initiated a re-examination of our practices. In April 2020, the re-examination was closed with a determination that the Company is in material compliance and no adverse regulatory action was, or is expected to be, taken.

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Note 19 – Segment Information

See Note 1 for a description of our segments. A description of our basis for reporting segment operating results is outlined below. Intersegment revenues primarily reflect pharmacy related transactions between the Health Services and Integrated Medical segments.

The Company uses “pre-tax adjusted income from operations” and “adjusted revenues” as its principal financial measures of segment operating performance because management believes they best reflect the underlying results of business operations and permit analysis of trends in underlying revenue, expenses and profitability. Pre-tax adjusted income from operations is defined as income before taxes excluding realized investment results, amortization of acquired intangible assets, special items and, for periods prior to 2020, earnings contribution from transitioning clients Anthem Inc. and Coventry Health Care, Inc. (the “transitioning clients”). As of December 31, 2019, the transition of these clients was substantially complete; therefore, beginning in 2020, we no longer exclude results of transitioning clients from our adjusted revenues and adjusted income from operations. Income or expense amounts that are excluded from adjusted income from operations because they are not indicative of underlying performance or the responsibility of operating segment management include:

•Realized investment gains (losses) including changes in market values of certain financial instruments between balance sheet dates, as well as gains and losses associated with invested asset sales.

•Amortization of acquired intangible assets because these relate to costs incurred for acquisitions.

•Results of transitioning clients, for periods prior to 2020, because those results were not indicative of ongoing results.

•Special items, if any, that management believes are not representative of the underlying results of operations due to the nature or size of these matters.

The Company does not report total assets by segment because this is not a metric used to allocate resources or evaluate segment performance.

Adjusted revenues is defined as revenues excluding: 1) revenue contribution from transitioning clients for periods prior to 2020; 2) the Company’s share of certain realized investment results of its joint ventures reported in the International Markets segment using the equity method of accounting; and 3) special items, if any.

The following tables present the special items recorded by the Company for the three and six months ended June 30, 2020 and 2019.

	Three Months Ended
(In millions)	June 30, 2020				June 30, 2019
Description of special item charges (benefits) and financial statement line item(s)	After-tax		Before-tax		After-tax		Before-tax
Debt extinguishment costs (Debt extinguishment costs)	$	11	$	14	$	—	$	—
Integration and transaction-related costs (Selling, general and administrative expenses)	99		130		115		155
Charges associated with litigation matters (Selling, general and administrative expenses)	—		—		64		81
Total impact from special items	$	110	$	144	$	179	$	236

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	Six Months Ended
(In millions)	June 30, 2020				June 30, 2019
Description of Special Item Charges (Benefits) and Financial Statement Line Item(s)	After-tax		Before-tax		After-tax		Before-tax
Debt extinguishment costs (Debt extinguishment costs)	$	151	$	199	$	—	$	—
Integration and transaction-related costs (Selling, general and administrative expenses)	173		227		223		291
Charge for organizational efficiency plan (Selling, general and administrative expenses)	24		31		—		—
Charges associated with litigation matters (Selling, general and administrative expenses)	19		25		64		81
Contractual adjustment for a former client (Pharmacy revenues)	(66)		(87)		—		—
Total impact from special items	$	301	$	395	$	287	$	372

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Summarized segment financial information for the three and six months ended June 30 was as follows:

(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Three months ended June 30, 2020
Revenues from external customers	$	27,714	$	8,684	$	1,466	$	1,178	$	—	$	39,042
Inter-segment revenues	885		504		—		6		(1,395)
Net investment income	3		49		26		144		1		223
Total revenues	28,602		9,237		1,492		1,328		(1,394)		39,265
Net realized investment results from certain equity method investments	—		—		(60)		—		—		(60)
Adjusted revenues	$	28,602	$	9,237	$	1,432	$	1,328	$	(1,394)	$	39,205
Income (loss) before taxes	$	771	$	1,543	$	390	$	129	$	(544)	$	2,289
Pre-tax adjustments to reconcile to adjusted income from operations
(Income) attributable to noncontrolling interests	(3)		—		(5)		—		—		(8)
Net realized investment losses	—		(26)		(73)		1		—		(98)
Amortization of acquired intangible assets	481		6		7		2		—		496
Special items
Debt extinguishment costs	—		—		—		—		14		14
Integration and transaction-related costs	—		—		—		—		130		130
Pre-tax adjusted income (loss) from operations	$	1,249	$	1,523	$	319	$	132	$	(400)	$	2,823
(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Three months ended June 30, 2019
Revenues from external customers	$	27,337	$	8,668	$	1,343	$	1,131	$	—	$	38,479
Inter-segment revenues	633		189		—		7		(829)
Net investment income	17		111		40		171		1		340
Total revenues	27,987		8,968		1,383		1,309		(828)		38,819
Revenue contributions from transitioning clients	(4,450)		—		—		—		—		(4,450)
Net realized investment results from certain equity method investments	—		—		6		—		—		6
Adjusted revenues	$	23,537	$	8,968	$	1,389	$	1,309	$	(828)	$	34,375
Income (loss) before taxes	$	1,108	$	989	$	195	$	155	$	(689)	$	1,758
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients	(655)		—		—		—		—		(655)
(Income) attributable to noncontrolling interests	—		—		(4)		—		—		(4)
Net realized investment (gains) losses	—		(17)		8		(8)		—		(17)
Amortization of acquired intangible assets	709		18		8		2		—		737
Special items
Integration and transaction-related costs	—		—		—		—		155		155
Charges associated with litigation matters	—		—		—		—		81		81
Pre-tax adjusted income (loss) from operations	$	1,162	$	990	$	207	$	149	$	(453)	$	2,055

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(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Six Months Ended June 30, 2020
Revenues from external customers	$	53,970	$	17,952	$	2,886	$	2,350	$	—	$	77,158
Inter-segment revenues	1,859		970		—		11		(2,840)		—
Net investment income	28		175		66		306		1		576
Total revenues	55,857		19,097		2,952		2,667		(2,839)		77,734
Net realized investment results from certain equity method investments	—		—		(50)		—		—		(50)
Special items	(87)		—		—		—		—		(87)
Adjusted revenues	$	55,770	$	19,097	$	2,902	$	2,667	$	(2,839)	$	77,597
Income (loss) before taxes	$	1,465	$	2,683	$	624	$	201	$	(1,287)	$	3,686
Pre-tax adjustments to reconcile to adjusted income from operations
(Income) attributable to noncontrolling interests	(7)		—		(10)		—		—		(17)
Net realized investment losses	—		22		(27)		5		—		—
Amortization of acquired intangible assets	960		17		14		3		—		994
Special items
Debt extinguishment costs	—		—		—		—		199		199
Integration and transaction-related costs	—		—		—		—		227		227
Charge for organizational efficiency plan	—		—		—		—		31		31
Charges associated with litigation matters	—		—		—		—		25		25
Contractual adjustment for a former client	(87)		—		—		—		—		(87)
Pre-tax adjusted income (loss) from operations	$	2,331	$	2,722	$	601	$	209	$	(805)	$	5,058
(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Six Months Ended June 30, 2019
Revenues from external customers	$	53,534	$	17,578	$	2,727	$	2,240	$	—	$	76,079
Inter-segment revenues	1,370		351		—		14		(1,735)
Net investment income (loss)	32		234		78		351		(9)		686
Total revenues	54,936		18,163		2,805		2,605		(1,744)		76,765
Revenue contribution from transitioning clients	(8,939)		—		—		—		—		(8,939)
Net realized investment results from certain equity method investments	—		—		(22)		—		—		(22)
Adjusted revenues	$	45,997	$	18,163	$	2,783	$	2,605	$	(1,744)	$	67,804
Income (loss) before taxes	$	2,050	$	2,146	$	417	$	248	$	(1,315)	$	3,546
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients	(1,315)		—		—		—		—		(1,315)
(Income) attributable to noncontrolling interests	(1)		—		(8)		—		—		(9)
Net realized investment (gains)	—		(22)		(15)		(18)		—		(55)
Amortization of acquired intangible assets	1,422		36		19		3		—		1,480
Special items
Integration and transaction-related costs	—		—		—		—		291		291
Charges associated with litigation matters	—		—		—		—		81		81
Pre-tax adjusted income (loss) from operations	$	2,156	$	2,160	$	413	$	233	$	(943)	$	4,019

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Revenue from external customers includes pharmacy revenues, premiums and fees and other revenues. The following table presents these revenues by product, premium and service type for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Products (Pharmacy revenues) (ASC 606)
Network revenues	13,090		12,758		25,232		25,031
Home delivery and specialty revenues	$	12,183	$	12,272	$	23,897	$	24,056
Other	1,291		1,258		2,533		2,380
Total pharmacy revenues	26,564		26,288		51,662		51,467
Insurance premiums (ASC 944)
Integrated Medical premiums
Commercial
Health Insurance	3,090		3,065		6,551		6,104
Stop loss	1,152		1,067		2,313		2,136
Other	283		241		572		519
Government
Medicare Advantage	1,904		1,610		3,785		3,217
Medicare Part D	420		400		882		925
Other	1,063		1,013		2,129		2,078
Total Integrated Medical premiums	7,912		7,396		16,232		14,979
International Markets premiums	1,344		1,301		2,719		2,605
Domestic disability, life and accident premiums	1,124		1,069		2,240		2,116
Other premiums	26		37		55		74
Total premiums	10,406		9,803		21,246		19,774
Services (ASC 606)
Fees	1,979		2,376		4,133		4,766
Other external revenues	93		12		117		72
Total services	2,072		2,388		4,250		4,838
Total revenues from external customers	$	39,042	$	38,479	$	77,158	$	76,079

The Health Services segment may provide certain financial and performance guarantees, including a minimum level of discounts a client may receive, generic utilization rates and various service levels. Clients may be entitled to receive compensation if we fail to meet these guarantees. Actual performance is compared to the contractual guarantee for each measure throughout the period and the Company defers revenue for any estimated payouts within Accrued expenses and other liabilities (current). These estimates are adjusted at the end of the guarantee period. Historically, adjustments to original estimates have not been material. The performance guarantee liability was $0.9 billion as of June 30, 2020 and $1.0 billion as of December 31, 2019.

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

	PAGE
Executive Overview	56
Liquidity and Capital Resources	66
Critical Accounting Estimates	69
Segment Reporting	70
Health Services	70
Integrated Medical	73
International Markets	74
Group Disability and Other	76
Corporate	76
Investment Assets	77

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide information to assist you in better understanding and evaluating our financial condition as of June 30, 2020 compared with December 31, 2019 and our results of operations for the three and six months ended June 30, 2020 compared with the same periods last year and intended to help you understand the ongoing trends in our business. We encourage you to read this MD&A in conjunction with our Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2019 (“2019 Form 10-K”), in particular the “Risk Factors” contained in Part I, Item 1A of that form as such Risk Factors are supplemented by the information contained in Part II, Item 1A of our Form 10-Q for the quarter ended March 31, 2020.

Unless otherwise indicated, financial information in the MD&A is presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). See Note 2 to the Consolidated Financial Statements in our 2019 Form 10-K for additional information regarding the Company’s significant accounting policies and Note 3 to the Consolidated Financial Statements in this Form 10-Q for updates to those accounting policies resulting from adopting new accounting guidance. The preparation of interim consolidated financial statements necessarily relies heavily on estimates. This and certain other factors call for caution in estimating full-year results based on interim results of operations. In some of our financial tables in this MD&A, we present either percentage changes or “N/M” when those changes are so large as to become not meaningful. Changes in percentages are expressed in basis points (“bps”).

In this MD&A, our consolidated measures “adjusted income from operations,” earnings per share on that same basis and “adjusted revenues” are not determined in accordance with GAAP and should not be viewed as substitutes for the most directly comparable GAAP measures of “shareholders’ net income,” “earnings per share” and “total revenues.” We also use pre-tax adjusted income from operations and adjusted revenues to measure the results of our segments.

We use adjusted income from operations as our principal financial measure of operating performance because management believes it best reflects the underlying results of our business operations and permits analysis of trends in underlying revenue, expenses and profitability. We define adjusted income from operations as shareholders’ net

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income (or income before taxes for the segment metric) excluding realized investment gains and losses, amortization of acquired intangible assets, special items, and for periods prior to 2020, results of Anthem, Inc. and Coventry Health Care Inc. (“Coventry”) (collectively, the “transitioning clients”) (see the “Key Transactions and Business Developments” section of the MD&A for further discussion of transitioning clients). Cigna’s share of certain realized investment results of its joint ventures reported in the International Markets segment using the equity method of accounting are also excluded. Income or expense amounts excluded from adjusted income from operations because they are not indicative of underlying performance or the responsibility of operating segment management include:

•Realized investment gains (losses) including changes in market values of certain financial instruments between balance sheet dates, as well as gains and losses associated with invested asset sales.

•Amortization of acquired intangible assets because these relate to costs incurred for acquisitions.

•Results of transitioning clients, for periods prior to 2020, because those results are not indicative of ongoing results.

•Special items, if any, that management believes are not representative of the underlying results of operations due to the nature or size of these matters.

The term "Adjusted revenues" is defined as total revenues excluding the following adjustments: revenue contribution from transitioning clients for periods prior to 2020, special items and Cigna’s share of certain realized investment results of its joint ventures reported in the International Markets segment using the equity method of accounting. We exclude these items from this measure because management believes they are not indicative of past or future underlying performance of the business.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on Cigna’s current expectations and projections about future trends, events and uncertainties. These statements are not historical facts. Forward-looking statements may include, among others, statements concerning future financial or operating performance, including our ability to deliver affordable, personalized and innovative solutions for our customers and clients, in light of the challenges presented by the COVID-19 pandemic; future growth, business strategy, strategic or operational initiatives, including our organizational efficiency plan; economic, regulatory or competitive environments, particularly with respect to the pace and extent of change in these areas; financing or capital deployment plans and amounts available for future deployment; our prospects for growth in the coming years; strategic transactions, including the merger (“Merger”) with Express Scripts Holding Company and the sale of our U.S. Group Disability and Life business; our ongoing operational response to the COVID-19 pandemic; and other statements regarding Cigna’s future beliefs, expectations, plans, intentions, financial condition or performance. You may identify forward-looking statements by the use of words such as “believe,” “expect,” “plan,” “intend,” “anticipate,” “estimate,” “predict,” “potential,” “may,” “should,” “will” or other words or expressions of similar meaning, although not all forward-looking statements contain such terms.

Forward-looking statements are subject to risks and uncertainties, both known and unknown, that could cause actual results to differ materially from those expressed or implied in forward-looking statements. Such risks and uncertainties include, but are not limited to: our ability to achieve our financial, strategic and operational plans or initiatives; our ability to predict and manage medical and pharmacy costs and price effectively; our ability to adapt to changes or trends in an evolving and rapidly changing industry; our ability to effectively differentiate our products and services from those of our competitors and maintain or increase market share; our ability to develop and maintain good relationships with physicians, hospitals, other health care providers, producers, consultants and pharmaceutical manufacturers; changes in the pharmacy provider marketplace or pharmacy networks; changes in

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drug pricing; the impact of modifications to our operations and processes; our ability to identify potential strategic transactions and realize the expected benefits (including anticipated synergies) of such transactions in full or within the anticipated time frame, including with respect to the Merger and the sale of our Group Disability and Life business, as well as our ability to integrate or separate operations, resources and systems; the substantial level of government regulation over our business and the potential effects of new laws or regulations or changes in existing laws or regulations; the outcome of litigation, regulatory audits, investigations, actions or guaranty fund assessments; uncertainties surrounding participation in government-sponsored programs such as Medicare; the effectiveness and security of our information technology and other business systems and those of our key suppliers or other third parties; the impact of our debt service obligations on the availability of funds for other business purposes; unfavorable industry, economic or political conditions, including foreign currency movements; acts of civil unrest, war, terrorism, natural disasters or pandemics; reinsurance credit risk, the scale and scope of the COVID-19 pandemic and its potential impact on our business, operating results, cash flows and financial condition, as well as on our employees, clients, customers, suppliers and partners and on the U.S. and global economies, as well as more specific risks and uncertainties discussed in Part I, Item 1A – Risk Factors of our 2019 Form 10-K, as such Risk Factors are supplemented by information contained in Part II, Item 1A of the Form 10-Q for the quarter ended March 31, 2020, Part II, Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2019 Form 10-K and this MD&A and as described from time to time in our future reports filed with the Securities and Exchange Commission (the “SEC”).

You should not place undue reliance on forward-looking statements which speak only as of the date they are made, are not guarantees of future performance or results, and are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Cigna undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by law.

EXECUTIVE OVERVIEW

Cigna Corporation, together with its subsidiaries (either individually or collectively referred to as “Cigna,” the “Company,” “we,” “our” or “us”) is a global health service organization with a mission of helping those we serve improve their health, well-being and peace of mind. We offer a differentiated set of pharmacy, medical, dental, disability, life and accident insurance and related products and services offered by our subsidiaries. For further information on our business and strategy, see Item 1, “Business” in our 2019 Form 10-K.

COVID-19 Update

The novel strain of coronavirus (“COVID-19”) was declared a pandemic by the World Health Organization in March 2020 because the virus had surfaced in nearly all regions around the world. From the onset of the COVID-19 pandemic, Cigna has focused on continuing to deliver peace of mind for the people and businesses we serve, and our employees and their families. We’ve taken bold actions to drive affordability, reduce uncertainty, and make health care easier. To date, these actions throughout the United States and in many other parts of the world where we do business include:

Making Health Care Affordable

•Waiving customer out-of-pocket costs for COVID-19 related visits, testing and treatment delivered by any in-network provider anywhere – whether at an office, an urgent care center, emergency room or through virtual care.

•Protecting customers from surprise bills by out-of-network providers through the Customer Protection Program.

•Enabling customers to utilize free home delivery for maintenance medications.

•Helping people temporarily without coverage access prescription savings through Parachute Rx.

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•Providing employers tax-free financial assistance for employees for qualified disaster relief payments, such as medical payments, groceries, child care, and wellness services with the Cigna Care Card.

•Expanding financial relief to Cigna's dental and guaranteed cost medical clients by issuing premium credits.

Making Health Care Simple

•Encouraging use of virtual care through telehealth partners, including MDLIVE and Amwell.

•Encouraging Cigna Dental customers to utilize Cigna Dental Virtual Care powered by The TeleDentists.

•Enabling Buoy Health (U.S.) and Infermedica (outside U.S.) tools to provide COVID-19 symptom checkers.

•Availability of digital mental health care tools including Happify, iPrevail and Talkspace, and SilverCloud Health.

•Expanding Employee Assistance Programs for customers and households and have seen a significant increase in consultations.

Making Health Care Predictable

•Partnering with Medocity to offer a digital solution that allows customers to track their COVID-19 symptoms, connect with care advocates and access behavioral and emotional resources.

•Protecting prescription medication supply through quantity limits as needed.

•24/7 customer access to pharmacists.

•Waiving prior authorizations for patient transfers, emergency department visits and home health care services.

•Entitling customers to utilize virtual care for non-COVID-19 issues at the standard in-office benefit.

•Offering acute and advanced illness care offered at home.

Supporting Communities

•Cigna Foundation launched Brave of Heart Fund with a $25 million grant to provide financial assistance to survivors of frontline U.S. workers who gave their lives in the COVID-19 fight, with Cigna providing emotional support at no cost.

•Providing free on-demand supportive resources for customers and the general public, such as online articles, podcasts, and webinars.

•24/7 free mental health support line for the public.

Supporting the Medical Community

•Making it easier for hospitals to transfer COVID-19 patients to long-term acute care hospitals and subacute facilities.

•Waiving prior authorizations for patient transfers, emergency department visits, and home health care services.

•Donating medications to Washington University for a COVID-19 treatment clinical trial.

Supporting Our Workforce

•Enabling nearly 100% of employees who could work from home to do so, globally in less than 1 month.

•Granting employees 10 paid Emergency Time Off days for COVID-19 related absences.

•Lifting restriction on paid time-off use before accrual.

•20% pay premium for U.S. worksite-essential employees.

•Enhancing employee recognition program.

•Introducing the Cigna COVID-19 Employee Assistance Fund to help offset extraordinary financial hardships.

•Ensuring workplace health through enhanced safety protocols, including personal protective equipment for frontline staff.

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We have also taken actions to implement our business continuity plans over our operations. For example, the Company is mitigating risk associated with prescription drug supply through our ability to operate and leverage purchasing volume across the pharmaceutical supply chain. Our continuity plans also include global office closures, reductions in operating hours, travel restrictions, changes in operating procedures and enhancements for employees that cannot work remotely. We did not incur significant disruptions to our operations during the three and six months ended June 30, 2020 from COVID-19.

The COVID-19 pandemic has pervasively impacted the economy, financial markets and the global health care delivery systems during the second quarter, including significant deferral of care of our customers. These impacts were most prominent in April 2020 and moderated throughout the quarter with utilization levels returning to nearly normal levels by the end of June 2020. These impacts were most significant in our Integrated Medical segment where results reflect higher quarterly earnings and a lower medical care ratio as a result of the deferral of care significantly exceeding the incremental COVID-19 costs, partially offset by COVID-19 related actions including premium relief programs for clients as well as cost share waivers for customers. The Health Services segment quarterly earnings also reflected effects of the pandemic, specifically, a favorable mix of claims as a result of both the type of drugs dispensed as well as the distribution method used for dispensing and fulfilling, partially offset by lower non-specialty, 30-day retail script volume. Segment results are discussed further in the Segment Reporting section of this MD&A and discussion of the impact of COVID-19 on our investment portfolio and related considerations regarding our investment outlook can be found in Note 11 to the Consolidated Financial Statements and in the "Investment Assets" discussion of this MD&A, respectively.

While it is difficult to quantify the impact of the COVID-19 pandemic on our results for the remainder of 2020 and beyond, we believe that such results may be impacted by, among other things, lower customer volumes due to rising unemployment levels, by higher medical costs to treat those affected by the virus, by the return of costs related to previously deferred care, or by the potential for continued deferral of care.

Additionally, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. The direct impact of this new legislation was not material to the Company's results of operations for the three or six months ended June 30, 2020. As permitted by the CARES Act and COVID-19 related regulatory actions, the Company deferred approximately $900 million in income and payroll tax payments during the second quarter of 2020. Approximately $825 million of the deferred tax payments will be made during the third quarter of 2020. The Company did not request any funding under the CARES Act. However, in April 2020 the Company received $41 million from the provider relief fund, all of which has been returned to the U.S. Department of Health and Human Services.

The Company has taken actions to enhance our liquidity that, combined with our other sources of liquidity described in the "Liquidity and Capital Resources Outlook" below, and our current projections for operating cash flows, we believe are sufficient to support our operations and meet our obligations.

The situation surrounding COVID-19 remains fluid, and we are actively managing our response and assessing impacts to our financial position and operating results, as well as adverse developments in our business.

For further information regarding the potential impact of COVID-19 on the Company, please see “Risk Factors” contained in Part I, Item 1A of the 2019 Form 10-K as such Risk Factors are supplemented in Part II, Item 1A of the Form 10-Q for the quarter ended March 31, 2020.

See Note 1 to the Consolidated Financial Statements for a description of our segments. Unless otherwise specified, the commentary provided below describes our results for the three and six months ended June 30, 2020 compared with the same periods in 2019.

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Summarized below are certain key measures of our performance by segment for the three and six months ended June 30, 2020 and 2019:

Financial highlights by segment
	Three Months Ended June 30,						Six Months Ended June 30,
(Dollars in millions, except per share amounts)	2020		2019		% Change		2020		2019		% Change
Revenues
Adjusted revenues by segment
Health Services	$	28,602	$	23,537	22	%	$	55,770	$	45,997	21	%
Integrated Medical	9,237		8,968		3		19,097		18,163		5
International Markets	1,432		1,389		3		2,902		2,783		4
Group Disability and Other	1,328		1,309		1		2,667		2,605		2
Corporate, net eliminations	(1,394)		(828)		(68)		(2,839)		(1,744)		(63)
Adjusted revenues	39,205		34,375		14		77,597		67,804		14
Revenue contribution from transitioning clients	—		4,450		N/M		—		8,939		N/M
Net realized investment results from certain equity method investments	60		(6)		N/M		50		22		127
Special items	—		—		N/M		87		—		N/M
Total revenues	$	39,265	$	38,819	1	%	$	77,734	$	76,765	1	%
Shareholders’ net income	$	1,754	$	1,408	25	%	$	2,935	$	2,776	6	%
Adjusted income from operations	$	2,152	$	1,640	31	%	$	3,910	$	3,138	25	%
Earnings per share (diluted)
Shareholders’ net income	$	4.73	$	3.70	28	%	$	7.88	$	7.26	9	%
Adjusted income from operations	$	5.81	$	4.30	35	%	$	10.49	$	8.20	28	%
Pre-tax adjusted income from operations by segment
Health Services	$	1,249	$	1,162	7	%	$	2,331	$	2,156	8	%
Integrated Medical	1,523		990		54		2,722		2,160		26
International Markets	319		207		54		601		413		46
Group Disability and Other	132		149		(11)		209		233		(10)
Corporate, net of eliminations	(400)		(453)		12		(805)		(943)		15
Consolidated pre-tax adjusted income from operations	2,823		2,055		37		5,058		4,019		26
Adjustment for transitioning clients	—		655		N/M		—		1,315		N/M
Income attributable to noncontrolling interests	8		4		100		17		9		89
Realized investment gains (losses)	98		17		N/M		—		55		N/M
Amortization of acquired intangible assets	(496)		(737)		33		(994)		(1,480)		33
Special items	(144)		(236)		39		(395)		(372)		(6)
Income before income taxes	$	2,289	$	1,758	30	%	$	3,686	$	3,546	4	%

For further analysis and explanation of each segment’s results, see the “Segment Reporting” section of this MD&A.

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Consolidated Results of Operations (GAAP basis)
	Three Months Ended June 30,								Six Months Ended June 30,
(Dollars in millions)	2020			2019			% Change		2020			2019			% Change
Pharmacy revenues	$	26,564		$	26,288		1	%	$	51,662		$	51,467		—	%
Premiums	10,406			9,803			6		21,246			19,774			7
Fees and other revenues	2,072			2,388			(13)		4,250			4,838			(12)
Net investment income	223			340			(34)		576			686			(16)
Total revenues	39,265			38,819			1		77,734			76,765			1
Pharmacy and other service costs	25,611			24,963			3		49,801			49,013			2
Medical costs and other benefit expenses	7,112			7,576			(6)		15,434			15,196			2
Selling, general and administrative expenses	3,407			3,380			1		6,805			6,683			2
Amortization of acquired intangible assets	496			737			(33)		994			1,480			(33)
Total benefits and expenses	36,626			36,656			—		73,034			72,372			1
Income from operations	2,639			2,163			22		4,700			4,393			7
Interest expense and other	(374)			(428)			13		(765)			(880)			13
Debt extinguishment costs	(14)			—			N/M		(199)			—			N/M
Net realized investment gains (losses)	38			23			65		(50)			33			N/M
Income before income taxes	2,289			1,758			30		3,686			3,546			4
Total income taxes	529			348			52		737			764			(4)
Net income	1,760			1,410			25		2,949			2,782			6
Less: net income attributable to noncontrolling interests	6			2			200		14			6			133
Shareholders’ net income	$	1,754		$	1,408		25	%	$	2,935		$	2,776		6	%
Consolidated effective tax rate	23.1		%	19.8		%	330	bps	20.0		%	21.5		%	(150)	bps
Medical customers (in thousands)
Integrated Medical									15,415			15,408			—	%
International Markets									1,668			1,589			5
Total									17,083			16,997			1	%

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Reconciliation of Shareholders’ Net Income (GAAP) to Adjusted Income from Operations
	$ in millions								Diluted Earnings Per Share
	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019		2020		2019		2020		2019
Shareholders’ net income	$	1,754	$	1,408	$	2,935	$	2,776	$	4.73	$	3.70	$	7.88	$	7.26
After-tax adjustments required to reconcile to adjusted income from operations
Net realized investment (gains) losses	(88)		(13)		(11)		(51)		(0.24)		(0.03)		(0.03)		(0.13)
Amortization of acquired intangible assets	376		572		685		1,136		1.02		1.49		1.84		2.96
Adjustment for transitioning clients	—		(506)		—		(1,010)		—		(1.33)		—		(2.64)
Special items
Debt extinguishment costs	11		—		151		—		0.03		—		0.41		—
Integration and transaction-related costs	99		115		173		223		0.27		0.30		0.46		0.58
Charge for organizational efficiency plan	—		—		24		—		—		—		0.06		—
Charges associated with litigation matters	—		64		19		64		—		0.17		0.05		0.17
Contractual adjustment for a former client	—		—		(66)		—		—		—		(0.18)		—
Total special items	110		179		301		287		0.30		0.47		0.80		0.75
Adjusted income from operations	$	2,152	$	1,640	$	3,910	$	3,138	$	5.81	$	4.30	$	10.49	$	8.20

Commentary: Three and Six Months Ended June 30, 2020 versus the same periods in 2019

Unless indicated otherwise, the commentary presented below, and in the segment discussions that follow, compare results for the three and six months ended June 30, 2020 with results for the three and six months ended June 30, 2019.

Earnings and Revenue

Shareholders’ net income increased, driven by significantly higher adjusted income from operations and lower amortization, partially offset by the absence of earnings from transitioning clients.

Adjusted income from operations increased significantly, primarily due to higher earnings in Integrated Medical and International Markets segments driven by substantial declines in medical costs resulting from the deferral of care due to the COVID-19 pandemic.

Medical customers increased slightly as of June 30, 2020 compared with the same period last year primarily as a result of growth in the Select market segment, and, to a lesser extent, growth in International Markets and in our Medicare Advantage business, substantially offset by declines in the National Accounts market segment and increased disenrollment resulting from the economic impacts of the COVID-19 pandemic.

Pharmacy revenues increased, primarily reflecting the transition of Integrated Medical's customers to Health Services, higher claims volumes, primarily driven by the Health Services collaboration with Prime Therapeutics, and an increase in pricing, primarily due to inflation on branded drugs. These factors were substantially offset by the

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absence of revenues from the transitioning clients and, to a lesser extent, an increase in generic fill rate. See the Health Services segment section of this MD&A for further discussion of pharmacy revenues.

Premiums increased, primarily resulting from customer growth and rate increases reflecting expected medical cost inflation and the return of the health insurance industry tax. These factors were partially offset by the impact of premium relief programs implemented in the second quarter of 2020 in response to significantly lower than historical utilization as individuals deferred care due to the COVID-19 pandemic.

Fees and Other Revenues decreased, primarily reflecting the impact of the transition of Integrated Medical’s commercial customers to Health Services’ retail pharmacy network in the third quarter of 2019. See section K of Note 2 to the Consolidated Financial Statements contained in our 2019 Form 10-K for further information. Additionally, the decreases resulted from lower cost containment program fees driven by lower claims volumes due to COVID-19.

Net investment income decreased, primarily driven by losses in certain securities partnership investments due to current economic conditions. See the Investment Asset section of this MD&A for further discussion.

Other Components of Consolidated Results of Operations

•Pharmacy and other service costs increased, primarily reflecting the transition of Integrated Medical's customers to Health Services; higher claims volumes, primarily driven by the Health Services collaboration with Prime Therapeutics, and an increase in pricing, primarily due to inflation on branded drugs. These factors were substantially offset by the impact of the absence of the transitioning clients and, to a lesser extent, effective management of supply chain and the favorable impact of the mix of claims.

•Medical costs and other benefit expenses: For the three months, medical costs and other benefit expenses decreased substantially, driven by significantly lower medical utilization in the Integrated Medical and International Markets segments resulting from the deferral of care due to COVID-19, partially offset by customer growth in the insured business. For the six months, the increase reflects customer growth in Integrated Medical and increased claims in Group and Other, offset by lower medical cost utilization in the Integrated Medical and International Markets segments due to COVID-19.

•Selling, general and administrative expenses increased, primarily due to the health insurance industry tax in 2020 that had been suspended in 2019, partially offset by a decrease in integration and transaction-related costs.

•Amortization of acquired intangible assets in 2020 primarily reflects lower amortization of customer-related intangibles associated with the transitioning clients.

•Consolidated effective tax rate: For the three months, the consolidated effective tax rate increased, reflecting the return of the health insurance industry tax and the absence of certain state tax benefits recognized in the second quarter of 2019. For the six months, the consolidated effective tax rate declined, primarily due to recognizing incremental federal and state tax benefits in the first quarter of 2020, partially offset by the return of the nondeductible health insurance industry tax.

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Key Transactions and Business Developments

Merger with Express Scripts

As discussed in more detail in our 2019 Form 10-K, Cigna acquired Express Scripts on December 20, 2018 in a cash and stock transaction valued at $52.8 billion. We continue to incur costs related to this transaction, including costs to integrate the Cigna and Express Scripts operations. These costs are being reported in “integration and transaction-related costs” as a special item and excluded from adjusted income from operations because they are not indicative of future underlying performance of the business.

On January 30, 2019, Anthem exercised its early termination right and terminated its pharmacy benefit management services agreement with us, effective March 1, 2019. There was a twelve-month transition period that ended March 1, 2020. We excluded the results of Express Scripts’ contract with Anthem (and also Coventry) from our non-GAAP reporting metrics “adjusted revenues” and “adjusted income from operations” for 2019 and refer to these clients as “transitioning clients.” As of December 31, 2019, the transition was substantially complete; therefore, beginning in 2020, we no longer exclude results of transitioning clients from our reported adjusted revenues and adjusted income from operations.

Agreement to sell Group Disability and Life business

As discussed in Note 6 to the Consolidated Financial Statements, Cigna entered into a definitive agreement in December 2019 to sell the U.S. Group Disability and Life business to New York Life Insurance Company for $6.3 billion. The “Liquidity” section of this MD&A provides further discussion of the impact of this pending divestiture on our liquidity and capital resources.

Organizational Efficiency Plan

Consistent with our commitment to affordability for our customers and clients, during the fourth quarter of 2019 the Company committed to a plan to increase our organizational alignment and operational efficiency and reduce costs. As a result, we recognized a charge in Selling, general and administrative expenses of $207 million, pre-tax ($162 million, after-tax) in the fourth quarter of 2019 and an additional charge of $31 million pre-tax ($24 million, after-tax) in the first quarter of 2020. We expect to realize annualized after-tax savings of approximately $200 million. A substantial portion of the savings is expected to be realized in 2020. See Note 15 to the Consolidated Financial Statements for discussion.

Industry Developments and Other Matters

Our 2019 Form 10-K provides a detailed description of The Patient Protection and Affordable Care Act (“ACA”) provisions and other legislative initiatives that impact our health care and pharmacy services businesses, including regulations issued by the Centers for Medicare & Medicaid Services (“CMS”) and the Departments of the Treasury and Health and Human Services. The health care and pharmacy services businesses continue to operate in a dynamic environment, and the laws and regulations applicable to these businesses, including the ACA, continue to be subject to legislative, regulatory and judicial challenges. The following table provides an update on the expected impact of these items and other matters:

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Item	Description
Executive Orders regarding Drug Pricing	On July 24, 2020, President Trump signed four Executive Orders addressing prescription drug importation; affordability of insulin and epinephrine purchased at federally qualified health centers through the Public Health Service Act Section 340B drug pricing program; drug rebates and favored-nation international pricing. The release of the favored-nation international pricing order, an approach to international reference pricing, was delayed thirty days. The remaining three orders call for subsequent policy action by the Department of Health and Human Services (HHS). They do not contain any policy changes that take effect immediately. The order covering rebate policy directs HHS to complete prior rulemaking which proposed changes to the federal anti-kickback safe harbor to exclude regulatory protection for rebates between drug manufacturers and Medicare Part D plans, Medicaid managed care organizations and pharmacy benefit managers. This order also requires that prior to taking such action, the Secretary confirm that the action is not projected to increase federal spending, Medicare beneficiary premiums or customers’ total out-of-pocket costs. We do not believe the executive orders will have a material impact on our business.
COVID-19-related Regulatory Actions	In response to the COVID-19 public health emergency, U.S. federal and state governments have increasingly enacted new regulatory requirements, as well as provided additional flexibility to industry participants. These regulatory actions primarily provide for: •client and customer premium relief to avoid the cancellation or non-renewal of policies; •mandating or requesting waiver of customer cost-sharing and other associated costs related to COVID-19 testing or treatment, as well as future vaccine immunizations; •extending claims filing deadlines for providers, customers and facilities; •mandating or encouraging waiver of customer cost-share related to telemedicine services, as well as requiring certain reimbursement levels for telemedicine providers to encourage its utilization; •enacting coverage and reimbursement requirements at in-network levels for certain services received from out-of-network providers; •revising or suspending the use of certain medical management procedures; and •mandating prescription drug benefit administration requirements primarily related to formulary exceptions and restrictions, and prior authorization and prescription drug refill limits. We are diligently working with federal, state and local governments to deliver access to simple, affordable and predictable health care and continue to monitor developments.
Medicare Advantage ("MA")	MA Rates: Final MA reimbursement rates for 2021 were published by CMS in April 2020. We do not expect the new rates to have a material impact on our consolidated results of operations in 2021.
	Risk Adjustment: As discussed in the “Regulation” and “Risk Factors” sections of our 2019 Form 10-K, our MA business is subject to reviews, including risk adjustment data validation (“RADV”) audits by CMS and the Office of the Inspector General (“OIG”). We expect that CMS, OIG and other federal agencies will continue to closely scrutinize components of the Medicare program.
	The “Regulation” section of the 2019 Form 10-K also discusses a proposed rule issued by CMS in 2018 for RADV audits of contract year 2011 and all subsequent years that included, among other things, extrapolation of the error rate related to RADV audit findings without applying the adjustment for underlying fee-for-service data errors as currently contemplated by CMS’ RADV audit methodology. RADV audits for our contract years 2011 through 2015 are currently in process. CMS has announced its intent to use third-party auditors to audit all Medicare Advantage contracts by either a comprehensive or a targeted RADV review for each contract year. If the proposed rule is adopted in its current form, it could result in some combination of degraded plan benefits, higher monthly premiums and reduced choice for the population served by all MA insurers. The Company, along with other MA organizations and additional interested parties, submitted comments to CMS on the proposed rule as part of the notice-and-comment rulemaking process. The comment period concluded on August 28, 2019. If CMS adopts the rule as proposed, there could be a material impact on the Company’s future results of operations, though we expect the rule would be subject to legal challenges. In addition, the Company is subject to OIG RADV audits that are in process. Certain OIG audit activities have been suspended for an indeterminate amount of time as a result of the COVID-19 public health emergency. Previously suspended CMS audit activities have either resumed or are expected to resume during the third quarter of 2020.
	Also, as described in Note 18 to the Consolidated Financial Statements, the U.S. Department of Justice is currently conducting an industry-wide investigation of risk adjustment data submission practices and business processes, which in the case of certain other MA organizations has resulted in litigation.

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Item	Description
ACA Cost-Sharing Reduction Subsidies	The ACA provides for cost-sharing reductions that offset the amount that qualifying customers pay for deductibles, copays and coinsurance. The federal government stopped funding insurers for the cost-sharing reduction subsidies in 2017. Certain insurers have sued the federal government for failure to pay cost-sharing reduction subsidies and the matter remains unresolved. To date, judges in six of those actions have ruled in favor of the insurers, all of which are presently under appeal. The Court of Appeals for the Federal Circuit heard oral argument in the first set of consolidated appeals on January 9, 2020. As described in Note 18 to the Consolidated Financial Statements, as a result of the Supreme Court decision in April 2020, we filed a lawsuit in May 2020 against the federal government seeking payment of these subsidies. Our premium rates for the 2019 and 2020 plan years reflected a lack of government funding for cost-sharing reduction subsidies.
Affordable Care Act	As described in the “Business - Regulation” section of our 2019 Form 10-K, a federal district court ruled that the “individual mandate” in the ACA is unconstitutional. On appeal, the Court of Appeals for the Fifth Circuit agreed that the “individual mandate” is unconstitutional but ordered the district court to reexamine whether the other provisions of the ACA can remain in effect, thereby leaving in doubt whether the entire ACA is unconstitutional until there is a final judicial determination on appeal. The California-led states and the U.S. House of Representatives filed petitions seeking to appeal the Fifth Circuit's ruling to the U.S. Supreme Court. On March 2, 2020, the Supreme Court agreed to hear the appeals and we expect the case will be argued during the next court term which runs from October 2020 through June 2021.

Risk Mitigation Programs – Individual ACA Business

Risk Corridor. In 2016, we recorded an allowance for the balance of our ACA risk corridors receivable based on court decisions and the large program deficit. On April 27, 2020, the U.S. Supreme Court ruled that insurers are entitled to the full amount due under the risk corridors program. The Supreme Court remanded the cases before it to the lower courts for further proceedings consistent with its opinion. The decision does not order an immediate issuance of payment and the timing of any payments is unclear. As of June 30, 2020, the Company has $120 million in uncollected risk corridors payments. As described in Note 18 to the Consolidated Financial Statements, we filed a lawsuit in May 2020 seeking payment of these funds.

Risk Adjustment. Following each program year, risk adjustment balances are subject to audit adjustment by CMS through the RADV program. RADV audits commenced with the 2017 benefit year. CMS published the final RADV transfers for the 2017 benefit year in 2019 along with guidance that the settlement will not take place until 2021. The 2018 benefit year data validation error rates were released by CMS in June 2020 and the RADV transfers are expected to be published by CMS in August 2020, subject to an appeals period with final settlement expected in 2022. Based on the information currently available, we adjusted our risk adjustment balance to reflect the expected outcome of the RADV program.

The following table presents our balances associated with the risk adjustment program and RADV audit adjustments as of June 30, 2020 and December 31, 2019.

	Receivable (Payable) Balances
(In millions)	June 30, 2020		December 31, 2019
Risk Adjustment
Receivables (1)	$	104	$	47
Payables (2)	$	(256)	$	(213)

(1)Receivables, net of allowances, are reported in Accounts receivable, net in the Consolidated Balance Sheets.

(2)Payables are reported in Accrued expenses and other liabilities (current) in the Consolidated Balance Sheets.

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Risk adjustment program activity, including any RADV adjustments, was favorable by $30 million pre-tax ($23 million after tax) for the three months and $15 million pre-tax ($11 million after tax) for the six months ended June 30, 2020 compared with charges of $76 million pre-tax ($58 million after tax) and $116 million pre-tax ($89 million after-tax) for the same periods in 2019.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity

We maintain liquidity at two levels: the subsidiary level and the parent company level.

Liquidity requirements at the subsidiary level generally consist of:

•pharmacy, medical costs and other benefit payments;

•expense requirements, primarily for employee compensation and benefits, information technology and facilities costs;

•income taxes; and

•debt service.

Our subsidiaries normally meet their liquidity requirements by:

•maintaining appropriate levels of cash, cash equivalents and short-term investments;

•using cash flows from operating activities;

•matching investment durations to those estimated for the related insurance and contractholder liabilities;

•selling investments; and

•borrowing from affiliates, subject to applicable regulatory limits.

Liquidity requirements at the parent company level generally consist of:

•debt service and dividend payments to shareholders;

•lending to subsidiaries as needed; and

•pension plan funding.

The parent company normally meets its liquidity requirements by:

•maintaining appropriate levels of cash and various types of marketable investments;

•collecting dividends from its subsidiaries;

•using proceeds from issuing debt and common stock; and

•borrowing from its subsidiaries, subject to applicable regulatory limits.

Dividends from our insurance, Health Maintenance Organization (“HMO”) and foreign subsidiaries are subject to regulatory restrictions. See Note 20 to the Consolidated Financial Statements in our 2019 Form 10-K for additional information regarding these restrictions. Most of Express Scripts' subsidiaries are not subject to regulatory restrictions regarding dividends and therefore provide significant financial flexibility to Cigna.

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Cash flows for the six months ended June 30 were as follows:

	Six Months Ended June 30,
(In millions)	2020		2019
Operating activities	$	5,161	$	4,231
Investing activities	$	(506)	$	(159)
Financing activities	$	(2,130)	$	(4,307)

The following discussion explains variances in the various categories of cash flows for the six months ended June 30, 2020 compared with the same period in 2019.

Operating activities

Cash flows from operating activities consist principally of cash receipts and disbursements for pharmacy revenues and costs, premiums, fees, investment income, taxes, benefit costs and other expenses.

Cash flows from operating activities increased, primarily driven by higher pharmacy and services costs payable due to business growth and lower tax payments from the deferral of income and payroll tax payments as permitted under the CARES Act and COVID-19 related Regulatory actions, partially offset by an increase in accounts receivable due to business growth and collection timing and higher inventory purchases.

Investing and Financing activities

Cash used in investing activities increased, primarily due to lower net investment sales.

Cash used in finance activities decreased, primarily due to proceeds from issuance of new long-term debt and term loan, partially offset by the debt tender and redemption and repayment of commercial paper borrowing.

We maintain a share repurchase program authorized by our Board of Directors. Under this program, we may repurchase shares from time to time, depending on market conditions and alternate uses of capital. The timing and actual number of shares repurchased will depend on a variety of factors including price, general business and market conditions and alternate uses of capital. The share repurchase program may be effected through open market purchases or privately negotiated transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, including through Rule 10b5-1 trading plans. The program may be suspended or discontinued at any time.

For the six months ended June 30, 2020, we repurchased 7.2 million shares for approximately $1.3 billion. From July 1, 2020 through July 31, 2020 we repurchased 1.2 million shares for approximately $210 million. Share repurchase authority was $4.4 billion as of July 31, 2020.

Capital Resources

Our capital resources (primarily cash flows from operating activities and proceeds from the issuance of debt and equity securities) provide protection for policyholders, furnish the financial strength to underwrite insurance risks and facilitate continued business growth.

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In December 2019, Cigna entered into a definitive agreement to sell the U.S. Group Disability and Life business to New York Life Insurance Company for $6.3 billion. The sale is expected to close in the third quarter of 2020 subject to applicable regulatory approvals and other customary closing conditions. Cigna estimates to receive approximately $5.3 billion of net after-tax proceeds from this transaction and expects to use these proceeds primarily for share repurchase and repayment of debt in 2020.

In 2018, Cigna entered into a $3.25 billion five-year revolving credit agreement and term loan credit agreement in financing the Express Scripts acquisition. Cigna had immaterial letters of credit outstanding under the revolving credit agreement as of June 30, 2020. The term loan was repaid in full and the agreement was terminated in the fourth quarter of 2019. In the fourth quarter of 2019, Cigna entered into an additional $1.0 billion 364-day revolving credit agreement that matures in October 2020.

On April 1, 2020, the Company borrowed an aggregate principal amount of $1.4 billion under a new 364-day term loan credit agreement. The Company entered into this agreement to further enhance its liquidity position in light of disruption in the commercial paper market and used a portion of the proceeds to pay down amounts outstanding under its commercial paper facility. See Note 8 to the Consolidated Financial Statements for further information on our credit agreements.

At June 30, 2020, our debt-to-capitalization ratio was 43.5%, a decline from 45.2% at December 31, 2019. We have a near-term focus on accelerated debt repayment and expect to continue to deleverage into the upper 30%s by the end of 2020 using cash flows from operating activities and a portion of the proceeds from the sale of the Group Disability and Life business.

Management, guided by regulatory requirements and rating agency capital guidelines, determines the amount of capital resources that we maintain. Management allocates resources to new long-term business commitments when returns, considering the risks, look promising and when the resources available to support existing business are adequate.

We prioritize our use of capital resources to:

•provide the capital necessary to support growth and maintain or improve the financial strength ratings of subsidiaries and to fund pension obligations;

•consider acquisitions that are strategically and economically advantageous; and

•return capital to investors primarily through share repurchases.

Our capital management strategy to support the liquidity and regulatory capital requirements of our foreign operations and certain international growth initiatives is to retain overseas a significant portion of the earnings generated by our foreign operations. This strategy does not materially limit our ability to meet our liquidity and capital needs in the United States.

Liquidity and Capital Resources Outlook

We maintain sufficient liquidity to meet our cash needs through our cash and cash equivalents balances, cash flows from operations, commercial paper program, credit agreements, and the issuance of long-term debt. As of June 30, 2020, we had $4.25 billion of undrawn committed capacity under our revolving credit agreements, $3.25 billion of remaining capacity under our commercial paper program, and approximately $7.6 billion in cash and short-term investments, approximately $1.7 billion of which was held by the parent company or certain nonregulated subsidiaries. We actively monitor our debt obligations and engage in issuance or redemption activities as needed in

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accordance with our capital management strategy. A description of our outstanding debt can be found in Note 8 to the Consolidated Financial Statements.

We currently expect the required contributions for 2020 and 2021 under the Pension Protection Act of 2006 to be immaterial.

Our cash projections may not be realized and the demand for funds could exceed available cash if our ongoing businesses experience unexpected shortfalls in earnings or we experience material adverse effects from one or more risks or uncertainties described more fully in the Risk Factors section of our 2019 Form 10-K and Part II, Item 1A of the Form 10-Q for the quarter ended March 31, 2020. Though we believe we have adequate sources of liquidity, significant disruption or volatility in the capital and credit markets could affect our ability to access those markets for additional borrowings or increase costs. In addition to the sources of liquidity discussed above, the parent company can borrow an additional $1.3 billion from its subsidiaries without further approvals as of June 30, 2020.

Guarantees and Contractual Obligations

We are contingently liable for various contractual obligations entered into in the ordinary course of business. See Note 18 to the Consolidated Financial Statements for discussion of various guarantees.

We have updated long-term debt obligations as of June 30, 2020 previously provided in our 2019 Form 10-K. There have been no material changes to the other information presented in our table of guarantees and contractual obligations as set forth in our 2019 Form 10-K.

(In millions, on an undiscounted basis)	Total	2020	2021 to 2022	2023 to 2024	Thereafter
On-Balance Sheet
Long-term debt(1)	53,419	3,967	7,954	7,106	34,392

(1)Amounts include scheduled interest payments, current maturities of long-term debt and term loan borrowing. Finance leases are included in long-term debt and primarily represent obligations for information technology network storage, servers and equipment. See Note 16 to the Consolidated Financial Statements for information regarding finance leases. See Note 8 to the Consolidated Financial Statements for information regarding our long-term debt.

CRITICAL ACCOUNTING ESTIMATES

The preparation of Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect reported amounts and related disclosures in the Consolidated Financial Statements. Management considers an accounting estimate to be critical if:

•it requires assumptions to be made that were uncertain at the time the estimate was made; and

•changes in the estimate or different estimates that could have been selected could have a material effect on our consolidated results of operations or financial condition.

Management has discussed how critical accounting estimates are developed and selected with the Audit Committee of our Board of Directors and the Audit Committee has reviewed the disclosures presented in our 2019 Form 10-K. We regularly evaluate items that may impact critical accounting estimates. Our most critical accounting estimates, as well as the effect of hypothetical changes in material assumptions used to develop each estimate, are described in the 2019 Form 10-K. As of June 30, 2020 there were no significant changes to the critical accounting estimates from what was reported in our 2019 Form 10-K.

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SEGMENT REPORTING

The following section of this MD&A discusses the results of each of our segments. See Note 1 to the Consolidated Financial Statements for a description of our segments.

In segment discussions, we present adjusted revenues and “pre-tax adjusted income from operations,” defined as income before taxes excluding realized investment gains (losses), amortization of acquired intangible assets, special items and, for periods prior to 2020, results of transitioning clients. Ratios presented in this segment discussion exclude the same items as pre-tax adjusted income from operations. See Note 19 to the Consolidated Financial Statements for additional discussion of these metrics and a reconciliation of income before income taxes to pre-tax adjusted income from operations, as well as a reconciliation of total revenues to adjusted revenues. Note 19 to the Consolidated Financial Statements also explains that segment revenues include both external revenues and sales between segments that are eliminated in Corporate.

In these segment discussions, we also present “pre-tax adjusted margin,” defined as pre-tax adjusted income from operations divided by adjusted revenues.

Health Services Segment

The Health Services segment includes pharmacy benefit management, specialty pharmacy services, clinical solutions, home delivery and health management services. As described in the introduction to Segment Reporting, performance of the Health Services segment is measured using pre-tax adjusted income from operations.

The key factors that impact Health Services revenues and costs of revenues are volume, mix of claims and price. These key factors are discussed further below. See Note 2 to the Consolidated Financial Statements included in our 2019 Form 10-K for additional information on revenue and cost recognition policies for this segment.

•As our clients’ claim volumes increase or decrease, our resulting revenues and cost of revenues correspondingly increase or decrease. Our gross profit could also increase or decrease as a result of changes in purchasing discounts.

•The mix of claims generally considers the type of drug and distribution method used for dispensing and fulfilling. Types of drugs can have an impact on our pharmacy revenues, pharmacy and other service costs and gross profit, including amounts payable under certain financial and performance guarantees with our clients. In addition to the types of drugs, the mix of generic claims (i.e. generic fill rate), also impacts our gross profit. Generally, higher generic fill rates reduce revenues, as generic drugs are typically priced lower than the branded drugs they replace. However, as ingredient cost paid to pharmacies on generic drugs is incrementally lower than the price charged to our clients, higher generic fill rates generally have a favorable impact on our gross profit. The home delivery generic fill rate is currently lower than the network generic fill rate as fewer generic substitutions are available among maintenance medications (such as therapies for chronic conditions) commonly dispensed from home delivery pharmacies as compared to acute medications that are primarily dispensed by pharmacies in our retail networks. Furthermore, our gross profit differs among network, home delivery and specialty distribution methods and can impact our profitability.

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•Our client contract pricing is impacted by our ongoing ability to negotiate supply chain contracts for pharmacy network, pharmaceutical and wholesaler purchasing, and manufacturer rebates. As we seek to improve the effectiveness of our integrated solutions for the benefit of our clients, we are continuously innovating and optimizing the supply chain. Our gross profit could also increase or decrease as a result of supply chain initiatives implemented. Inflation also impacts our pricing because most of our contracts provide that we bill clients and pay pharmacies based on a generally recognized price index for pharmaceuticals. Therefore, the rate of inflation for prescription drugs and our efforts to manage this inflation for our clients can affect our revenues and cost of revenues.

In this MD&A, we present revenues and gross profit, as well as adjusted revenues and adjusted gross profit, consistent with our segment reporting metrics, which exclude special items and, for periods prior to 2020, contributions from transitioning clients. As of December 31, 2019, the transition of these clients was substantially complete; therefore, beginning in 2020, we no longer exclude results of transitioning clients from our adjusted metrics. See the “Key Transactions and Business Developments” section of our 2019 Form 10-K MD&A for further discussion of transitioning clients and why we present this information.

Results of Operations

Financial Summary	Three Months Ended June 30,						Change Favorable (Unfavorable)		Six Months Ended June 30,						Change Favorable (Unfavorable)
(In millions)	2020			2019					2020			2019
Total revenues	$	28,602		$	27,987		2	%	$	55,857		$	54,936		2	%
Less: transitioning clients	—			(4,450)			N/M		—			(8,939)			N/M
Less: contractual adjustment for a former client	—			—			N/M		(87)			—			N/M
Adjusted revenues(1)	$	28,602		$	23,537		22	%	$	55,770		$	45,997		21	%
Gross profit	$	1,781		$	2,325		(23)	%	$	3,482		$	4,439		(22)	%
Adjusted gross profit(1)	$	1,781		$	1,611		11	%	$	3,395		$	3,007		13	%
Pre-tax adjusted income from operations	$	1,249		$	1,162		7	%	$	2,331		$	2,156		8	%
Pre-tax adjusted margin	4.4		%	4.9		%	(50)	bps	4.2		%	4.7		%	(50)	bps

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	Three Months Ended June 30,						Change Favorable (Unfavorable)		Six Months Ended June 30,						Change Favorable (Unfavorable)
(Dollars and adjusted scripts in millions)	2020			2019					2020			2019
Selected Financial Information(1)
Pharmacy revenue by distribution channel
Adjusted network revenues	$	13,866		$	9,758		42	%	$	26,657		$	19,026		40	%
Adjusted home delivery and specialty revenues	12,407			11,507			8	%	24,412			22,548			8	%
Other revenues	1,292			1,258			3	%	2,534			2,380			6	%
Total adjusted pharmacy revenues	$	27,565		$	22,523		22	%	$	53,603		$	43,954		22	%
Pharmacy script volume
Adjusted network scripts(2)	293			223			31	%	581			445			31	%
Adjusted home delivery and specialty scripts(2)	71			71			—	%	143			141			1	%
Total adjusted scripts(2)	364			294			24	%	724			586			24	%
Generic fill rate
Network	88.4		%	87.7		%	70	bps	88.3		%	87.8		%	50	bps
Home delivery	85.1		%	84.1		%	100	bps	85.0		%	84.2		%	80	bps
Overall generic fill rate	88.0		%	87.2		%	80	bps	87.9		%	87.3		%	60	bps

(1)Amounts exclude special items and, for periods prior to 2020, contributions from transitioning clients.

(2)Non-specialty network scripts filled through 90-day programs and home delivery scripts are multiplied by three. All other network and specialty scripts are counted as one script.

Three and Six Months Ended June 30, 2020 versus Three and Six Months Ended June 30, 2019

In the third quarter of 2019, Integrated Medical’s Commercial customers transitioned to Express Scripts’ retail pharmacy network. In the first quarter of 2020, Integrated Medical's Government segment customers transitioned to Express Scripts' retail pharmacy network.

Adjusted network revenues. The increase reflected the transition of Integrated Medical’s customers; higher claims volume, primarily due to our collaboration with Prime Therapeutics; and increased prices primarily due to inflation on branded drugs. This increase was partially offset by claims mix, due to the increase in the generic fill rate.

Adjusted home delivery and specialty revenues. The increase reflected higher prices, primarily due to inflation on branded drugs. For the six months ended June 30, 2020, the increase was also due to higher home delivery and specialty claims volume. For both the three and six months ended June 30, 2020, these increases were partially offset by claims mix due to an increase in the generic fill rate.

Adjusted gross profit. The increase reflected customer growth, higher adjusted pharmacy script volumes, benefits from the effective management of supply chain, and the favorable impact of claims mix as a result of the types of drugs dispensed, the distribution method used for dispensing and fulfilling, and an increase in the generic fill rate.

Pre-tax adjusted income from operations. The increase reflected customer growth, higher adjusted pharmacy scripts volumes, benefits from the effective management of supply chain, and the favorable impact of claims mix as a result of the types of drugs dispensed, the distribution method used for dispensing and fulfilling, and an increase in the generic fill rate, partially offset by an increase in operating expenses due to client transitions.

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Integrated Medical Segment

Integrated Medical consists of a Commercial operating segment that includes our employer-sponsored medical coverage and a Government operating segment that includes Medicare offerings for seniors and individual insurance offerings both on and off the public health insurance exchanges. As described in the introduction to Segment Reporting, performance of the Integrated Medical segment is measured using pre-tax adjusted income from operations. Key factors affecting profitability for this segment include:

•customer growth;

•revenues from integrated specialty products, including pharmacy services sold to clients and customers across all funding solutions;

•percentage of Medicare Advantage customers in plans eligible for quality bonus payments;

•benefit expenses as a percentage of premiums (medical care ratio or “MCR”) for our insured commercial and government businesses; and

•selling, general and administrative expense as a percentage of adjusted revenues (expense ratio).

Results of Operations

Financial Summary	Three Months Ended June 30,						Change Favorable (Unfavorable)		Six Months Ended June 30,						Change Favorable (Unfavorable)
(In millions)	2020			2019					2020			2019
Adjusted revenues	$	9,237		$	8,968		3	%	$	19,097		$	18,163		5	%
Pre-tax adjusted income from operations	$	1,523		$	990		54	%	$	2,722		$	2,160		26	%
Pre-tax adjusted margin	16.5		%	11.0		%	550	bps	14.3		%	11.9		%	240	bps
Medical care ratio	70.5		%	81.6		%	1,110	bps	74.5		%	80.3		%	580	bps
Expense ratio	23.1		%	21.6		%	(150)	bps	22.4		%	21.9		%	(50)	bps

	As of June 30,
(In thousands)	2020	2019	% Change
Integrated Medical Customers
Commercial	2,123	2,034	4	%
Government	1,415	1,382	2	%
Insured	3,538	3,416	4	%
Service	11,877	11,992	(1)	%
Total	15,415	15,408	—	%

(In millions)	As of June 30, 2020		As of December 31, 2019		% Change
Unpaid claims and claim expenses – Integrated Medical	$	2,959	$	2,892	2	%

Three and Six Months Ended June 30, 2020 versus Three and Six Months Ended June 30, 2019

Adjusted revenues. The increase for the three and six months ended June 30, 2020 compared with the same periods in 2019 reflects customer growth in our Commercial insured and Medicare Advantage businesses, as well as higher

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premium rates due to anticipated underlying medical cost trend and the resumption of the health insurance industry tax. These increases were partially offset by the impact of premium relief programs for clients implemented in the second quarter of 2020 in response to significantly lower than historical utilization as individuals deferred care due to the COVID-19 pandemic.

Pre-tax adjusted income from operations. The significant increase for the three and six months ended June 30, 2020 compared with the same periods in 2019 reflects increased earnings from the Commercial and Government insured businesses due to significant deferral of care by our customers in response to the COVID-19 pandemic exceeding the cost of COVID-19 related care, partially offset by lower net investment income.

Medical care ratio. The medical care ratio reflects a significant decrease for the three and six months ended June 30, 2020 compared with the same periods in 2019 due to the COVID-19 pandemic effects of significant deferred utilization exceeding incremental costs of care, partially offset by premium relief programs extended to employer clients.

Expense ratio. The expense ratio increased for the three and six months ended June 30, 2020 compared with the same periods in 2019, primarily reflecting the reinstatement of the health insurance industry tax in 2020, costs associated with operations-related litigation matters and the impact of premium relief programs, partially offset by higher insured revenues.

Other Items Affecting Integrated Medical Results

Unpaid Claims and Claim Expenses

Our unpaid claims and claim expenses liability was higher as of June 30, 2020 compared with December 31, 2019, primarily due to seasonality in our stop loss products partially offset by the impact of deferred utilization in both April and May 2020 due to the COVID-19 pandemic.

Medical Customers

Our medical customer base was flat at June 30, 2020 compared with the same period in 2019, primarily reflecting growth in our Select segment and our Medicare Advantage business offset by a lower customer base in our National Accounts and increased disenrollment resulting from the economic impacts of the COVID-19 pandemic.

A medical customer is defined as a person meeting any one of the following criteria:

•is covered under a medical insurance policy, managed care arrangement or service agreement issued by us;

•has access to our provider network for covered services under their medical plan; or

•has medical claims that are administered by us.

International Markets Segment

As described in the introduction to Segment Reporting, performance of the International Markets segment is measured using pre-tax adjusted income from operations. Key factors affecting pre-tax adjusted income from operations for this segment are:

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•premium growth, including new business and customer retention;

•benefit expenses as a percentage of premiums (loss ratio);

•selling, general and administrative expense and acquisition expense as a percentage of revenues (expense ratio and acquisition cost ratio); and

•the impact of foreign currency movements.

Results of Operations

Financial Summary	Three Months Ended June 30,						Change Favorable (Unfavorable)		Six Months Ended June 30,						Change Favorable (Unfavorable)
(In millions)	2020			2019					2020			2019
Adjusted revenues	$	1,432		$	1,389		3	%	$	2,902		$	2,783		4	%
Pre-tax adjusted income from operations	$	319		$	207		54	%	$	601		$	413		46	%
Pre-tax adjusted margin	22.3		%	14.9		%	740	bps	20.7		%	14.8		%	590	bps
Loss ratio	49.9		%	55.6		%	570	bps	53.9		%	56.4		%	250	bps
Acquisition cost ratio	11.7		%	13.7		%	200	bps	10.4		%	13.0		%	260	bps
Expense ratio (excluding acquisition costs)	19.1		%	19.0		%	(10)	bps	18.2		%	19.0		%	80	bps

Three and Six Months Ended June 30, 2020 versus Three and Six Months Ended June 30, 2019

Adjusted revenues increased mainly due to business growth in Asia and Europe, partially offset by unfavorable foreign currency movements.

Pre-tax adjusted income from operations increased due to lower loss and acquisition ratios and business growth, primarily in Asia, partially offset by unfavorable foreign currency movements and lower net investment income.

The segment’s loss ratio was more favorable reflecting lower medical utilization due to the COVID-19 pandemic, partially offset by the absence of 2019 reserve updates.

The acquisition cost ratio decreased reflecting an update to our commission deferral process and lower acquisition expenses in Asia.

The expense ratio (excluding acquisition costs) was essentially flat for the three months ended June 30, 2020. For the six months ended June 30, 2020, the decrease in the expense ratio was mainly driven by lower spend across markets.

Other Items Affecting International Markets Results

South Korea is the single largest geographic market for our International Markets segment. For the six months ended June 30, 2020, South Korea generated 36% of the segment’s adjusted revenues and 50% of the segment’s pre-tax adjusted income from operations.

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Group Disability and Other

As described in the introduction of Segment Reporting, performance of Group Disability and Other is measured using pre-tax adjusted income from operations. Key factors affecting pre-tax adjusted income from operations are:

•premium growth, including new business and customer retention;

•net investment income;

•benefit expenses as a percentage of premiums (loss ratio); and

•selling, general and administrative expense as a percentage of revenues excluding net investment income (expense ratio).

Results of Operations

Financial Summary	Three Months Ended June 30,						Change Favorable (Unfavorable)		Six Months Ended June 30,						Change Favorable (Unfavorable)
(In millions)	2020			2019					2020			2019
Adjusted revenues	$	1,328		$	1,309		1	%	$	2,667		$	2,605		2	%
Pre-tax adjusted income from operations	$	132		$	149		(11)	%	$	209		$	233		(10)	%
Pre-tax adjusted margin	9.9		%	11.4		%	(150)	bps	7.8		%	8.9		%	(110)	bps

Three and Six Months Ended June 30, 2020 versus Three and Six Months Ended June 30, 2019

Adjusted revenues increased due to growth in disability, life and voluntary products, partially offset by lower investment income.

Pre-tax adjusted income from operations and margin decreased due to unfavorable life claims experience related to COVID-19, lower investment income and lower interest rates, partially offset by favorable results in our voluntary products.

Corporate

Corporate reflects amounts not allocated to operating segments, including net interest expense (defined as interest on corporate debt less net investment income on investments not supporting segment and other operations), certain litigation matters, expense associated with our frozen pension plans, charitable contributions, severance, certain overhead and project costs and intersegment eliminations for products and services sold between segments.

Financial Summary	Three Months Ended June 30,				Change Favorable (Unfavorable)		Six Months Ended June 30,				Change Favorable (Unfavorable)
(In millions)	2020		2019				2020		2019
Pre-tax adjusted loss from operations	$	(400)	$	(453)	12	%	$	(805)	$	(943)	15	%

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Three and Six Months Ended June 30, 2020 versus Three and Six Months Ended June 30, 2019

Pre-tax adjusted loss from operations was lower, primarily reflecting lower interest expense.

INVESTMENT ASSETS

The following table presents our investment asset portfolio excluding separate account assets as of June 30, 2020 and December 31, 2019. Additional information regarding our investment assets is included in Notes 11, 12, 13 and 14 to the Consolidated Financial Statements.

(In millions)	June 30, 2020		December 31, 2019
Debt securities	$	23,674	$	23,755
Equity securities	373		303
Commercial mortgage loans	1,942		1,947
Policy loans	1,364		1,357
Other long-term investments	2,900		2,403
Short-term investments	456		423
Total	$	30,709	$	30,188
Investments classified as assets of business held for sale (1)	$	(8,181)	$	(7,709)
Investments per Consolidated Balance Sheets	$	22,528	$	22,479

⁽¹⁾ The table above includes $8.2 billion as of June 30, 2020 and $7.7 billion as of December 31, 2019 of investments associated with the U.S. Group Disability and Life business that are held for sale to New York Life. Under the terms of the definitive agreement, some of the assets currently associated with the Group Disability and Life business can be substituted for other assets. The assets that will transfer to New York Life will be primarily debt securities and, to a lesser extent, commercial mortgage loans and short-term investments.

Debt Securities

Investments in debt securities include publicly-traded and privately-placed bonds, mortgage and other asset-backed securities and preferred stocks redeemable by the investor. These investments are classified as available for sale and are carried at fair value on our balance sheet. Additional information regarding valuation methodologies, key inputs and controls is included in Note 12 to the Consolidated Financial Statements. More detailed information about debt securities by type of issuer and maturity dates is included in Note 11 to the Consolidated Financial Statements.

The following table reflects our portfolio of debt securities by type of issuer as of June 30, 2020 and December 31, 2019.

(In millions)	June 30, 2020		December 31, 2019
Federal government and agency	$	637	$	733
State and local government	737		810
Foreign government	2,286		2,256
Corporate	19,543		19,420
Mortgage and other asset-backed	471		536
Total	$	23,674	$	23,755

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Our debt securities portfolio decreased during the first six months of 2020 reflecting net sales and maturities, partially offset by an increase in valuations due to decreasing yields. As of June 30, 2020, $21.1 billion, or 89% of the debt securities in our investment portfolio were investment grade (Baa and above, or equivalent) and the remaining $2.5 billion were below investment grade. The majority of the bonds that are below investment grade are rated at the higher end of the non-investment grade spectrum. These quality characteristics have not materially changed from the prior year and are consistent with our investment strategy. Investments in debt securities are diversified by issuer, geography and industry as appropriate. On an aggregate basis, the debt securities portfolio continues to perform according to original investment expectations. However, due to the economic impacts of the COVID-19 pandemic, there are certain issuers, particularly within the aviation, energy and hospitality sectors that are showing signs of distress, primarily in the form of requests for temporary covenant relief. There were no material unrealized losses in any of these sectors as of the reporting date. We continue to monitor the economic environment and its effect on our portfolio, and consider the impact of various factors in determining the allowance for credit losses on debt securities, which is discussed in Note 11 to the Consolidated Financial Statements.

Foreign government obligations are concentrated in Asia, primarily South Korea, consistent with our risk management practice and local regulatory requirements of our international business operations. Corporate debt securities include private placement assets of $7.6 billion. These investments are generally less marketable than publicly-traded bonds; however yields on these investments tend to be higher than yields on publicly-traded bonds with comparable credit risk. We perform a credit analysis of each issuer and require financial and other covenants that allow us to monitor issuers for deteriorating financial strength and pursue remedial actions, if warranted.

In addition to amounts classified as debt securities in our Consolidated Balance Sheets, we participate in an insurance joint venture in China with a 50% ownership interest. This entity had an investment portfolio of approximately $9.5 billion supporting its business that is primarily invested in Chinese corporate and government debt securities. We account for this joint venture on the equity method of accounting and report it in Other assets. There were no investments with a material unrealized loss as of June 30, 2020.

Commercial Mortgage Loans

Our commercial mortgage loans are fixed rate loans, diversified by property type, location and borrower. Loans are secured by high quality commercial properties, located in strong institutional markets, and are generally made at less than 65% of the property’s value at origination of the loan. Property value, debt service coverage, quality, building tenancy and stability of cash flows are all important financial underwriting considerations. We hold no direct residential mortgage loans and do not originate or service securitized mortgage loans.

Overall, commercial real estate capital market activity has been negatively impacted by COVID-19 with concentrated weakness in hotels and regional malls. Our mortgage loan portfolio is well diversified by property type and geography with no material exposure to hotels and no exposure to regional shopping malls.

As of June 30, 2020, the $1.9 billion commercial mortgage loan portfolio consisted of approximately 65 loans that are in good standing. We completed the annual in-depth review of our commercial mortgage loan portfolio during the second quarter of 2020. The results of the review were generally in line with the prior year and reconfirmed the strength of the overall portfolio. The average loan to value ratio increased slightly to 60% and the portfolio’s average debt service coverage ratio decreased slightly to 2.01. Given the quality and diversity of the underlying real estate, positive debt service coverage and significant borrower cash invested generally ranging between 30 and 40%, we remain confident that the vast majority of borrowers will continue to perform as expected under their contract terms. For further discussion of the results and changes in key loan metrics, see Note 11 to the Consolidated Financial Statements.

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Other Long-term Investments

Other long-term investments of $2.9 billion as of June 30, 2020 included investments in securities limited partnerships and real estate limited partnerships, direct investments in real estate joint ventures, and other deposit activity that is required to support various insurance and health services businesses. The increase in other long term investments is driven by net new funding activity. Our approximately $2 billion of limited partnership entities typically invest in mezzanine debt or equity of privately-held companies (securities partnerships) and equity real estate. Given our subordinate position in the capital structure of these underlying entities, we assume a higher level of risk for higher expected returns. To mitigate risk, these investments are diversified across approximately 170 separate partnerships and approximately 85 general partners who manage one or more of these partnerships. Also, the underlying investments are diversified by industry sector or property type and geographic region. No single partnership investment exceeded 4% of our securities and real estate partnership portfolio.

Income from our limited partnership investments is generally reported on a one quarter lag due to the timing of when financial information is received from the general partner or manager of the investments. Accordingly, our net investment income in the second quarter reflects the underlying financial information from the first quarter of 2020, and is lower due to the economic impacts of COVID-19, reflecting declines in fair value and some operating losses of the underlying investments. We could experience additional losses during the remainder of 2020 and into future periods. The magnitude of these losses, will depend in part on the length and extent of the economic disruption, the speed of the recovery, and the overall economic impacts.

Investment Outlook

The impact of COVID-19 on the economy, despite unprecedented monetary and fiscal support, and the uncertainty as to the strength and sustainability of the recovery prior to a widely available vaccine continue to dominate financial markets. Our investment outlook has not changed materially from last quarter and we expect continued pressure on net investment income for the balance of the year and potentially beyond. Second quarter valuations of mezzanine, private equity, and real estate fund asset holdings and net investment income were negatively impacted by COVID-19 and the resulting economic and market conditions. The low interest rate environment is also pressuring income from both short-term and longer-term investments. U.S. treasury rates remain near all-time lows and the wider market credit spreads experienced during the beginning of the second quarter have meaningfully narrowed, resulting in historically low yields for investment grade assets. We continue to actively monitor the economic impact of the pandemic, as well as fiscal and monetary responses, and their potential impact on the portfolio. Our full year earnings projections reflect continued market volatility and portfolio impacts, particularly in certain sectors such as retail, hospitality, aviation and energy, as well as other areas most severely impacted by COVID-19 and the related shutdowns. Future realized and unrealized investment results will be driven largely by market conditions that exist when a transaction occurs or at the reporting date. These future conditions are not reasonably predictable; however, we believe that the vast majority of our investments will continue to perform under their contractual terms. Based on our strategy to match the duration of invested assets to the duration of insurance and contractholder liabilities, we expect to hold a significant portion of these assets for the long-term. Although future impairment losses resulting from interest rate movements and credit deterioration due to both investment-specific and the global economic uncertainties discussed above remain possible, we do not expect these losses to have a material adverse effect on our financial condition or liquidity.

MARKET RISK

Financial Instruments

Our assets and liabilities include certain financial instruments subject to the risk of potential losses from adverse changes in market rates and prices. Our primary market risk exposures are interest rate risk and foreign currency exchange rate risk. We encourage you to read this in conjunction with “Market Risk – Financial Instruments” included in the MD&A section of our 2019 Form 10-K. Given the transactions in our long-term debt further described in Note 8 to the Consolidated Financial Statements, in the event of a 100 basis point increase in interest

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rates, the fair value of the Company's long-term debt would decrease approximately $3.0 billion at June 30, 2020, compared to approximately $2.5 billion at December 31, 2019. Other than this, there were no material changes in our risk exposures from those reported in our 2019 Form 10-K.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information responsive to this item is contained under the caption “Market Risk” in Item 2 above, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and is incorporated herein by reference.

Item 4. CONTROLS AND PROCEDURES

Based on an evaluation of the effectiveness of Cigna’s disclosure controls and procedures conducted under the supervision and with the participation of Cigna’s management (including Cigna’s Chief Executive Officer and Chief Financial Officer), Cigna's Chief Executive officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, Cigna’s disclosure controls and procedures are effective to ensure that information required to be disclosed by Cigna in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and is accumulated and communicated to Cigna’s management, including Cigna’s Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

During the period covered by this report, there have been no changes in Cigna’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, Cigna’s internal control over financial reporting.

Part II. OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

The information contained under “Litigation Matters” and “Regulatory Matters” in Note 18 to the Consolidated Financial Statements is incorporated herein by reference.

Item 1A. RISK FACTORS

For information regarding factors that could affect the Company's results of operations, financial condition and liquidity, see the risk factors discussed in Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019 as such Risk Factors are supplemented by the information contained in Part II, Item 1A of our Form 10-Q for the quarter ended March 31, 2020. There have been no material changes to our previously reported Risk Factors.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table provides information about Cigna’s share repurchase activity for the quarter ended June 30, 2020:

Period	Total # of shares purchased (1)	Average price paid per share		Total # of shares purchased as part of publicly announced program (2)	Approximate dollar value of shares that may yet be purchased as part of publicly announced program (3)
April 1-30, 2020	476,671	$	167.03	475,000	$	2,903,570,181
May 1-31, 2020	563,876	$	190.44	533,100	$	2,802,107,025
June 1-30, 2020	851,987	$	193.00	850,985	$	2,637,861,789
Total	1,892,534	$	185.70	1,859,085	N/A

(1)Represents shares tendered by employees under the Company’s equity compensation plans as follows: 1) payment of taxes on vesting of restricted stock (grants and units) and strategic performance shares and 2) payment of the exercise price and taxes for certain stock options exercised. Employees tendered 1,671 shares in April, 30,776 shares in May and 1,002 shares in June 2020.

(2)Additionally, the Company maintains a share repurchase program authorized by the Board of Directors. Under this program, the Company may repurchase shares from time to time, depending on market conditions and alternate uses of capital. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions and alternate uses of capital. The share repurchase program may be effected through Rule 10b5-1 plans, open market purchases or privately negotiated transactions, each in compliance with Rule 10b-18 under the Exchange Act. The program may be suspended or discontinued at any time and does not have an expiration date. In July 2020, the Board increased repurchase authority by an additional $2 billion. From July 1, 2020 through July 31, 2020, the Company repurchased 1.2 million shares for approximately $210 million, leaving repurchase authority at $4.4 billion as of July 31, 2020.

(3)Approximate dollar value of shares is as of the last date of the applicable month.

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ITEM 6. EXHIBITS

INDEX TO EXHIBITS

Number	Description	Method of Filing
10.1	364-Day Term Loan Credit Agreement, dated as of April 1, 2020, with the lenders named therein, Bank of America, N.A., as administrative agent, BofA Securities, Inc., as lead arranger and lead bookrunner, and Citibank, N.A., JPMorgan Chase Bank, N.A., U.S. Bank National Association, and Morgan Stanley MUFG Loan Partners, LLC, as syndication agents	Filed by the registrant as Exhibit 10.1 to the Current Report on Form 8-K on April 3, 2020 and incorporated herein by reference.
31.1	Certification of Chief Executive Officer of Cigna Corporation pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934	Filed herewith.
31.2	Certification of Chief Financial Officer of Cigna Corporation pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934	Filed herewith.
32.1	Certification of Chief Executive Officer of Cigna Corporation pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350	Furnished herewith.
32.2	Certification of Chief Financial Officer of Cigna Corporation pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350	Furnished herewith.
101	Financial statements from the quarterly report on Form 10-Q of Cigna Corporation for the quarter ended June 30, 2020 formatted in inline XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Income; (ii) the Consolidated Statements of Comprehensive Income; (iii) the Consolidated Balance Sheets; (iv) the Consolidated Statements of Total Equity; (v) the Consolidated Statements of Cash Flow; and (vi) the Notes to the Consolidated Financial Statements	Filed herewith.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)	Filed herewith.

* Management contracts and compensatory plans or arrangements.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: August 6, 2020

CIGNA CORPORATION
	/s/ Eric P. Palmer
Eric P. Palmer
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer and Authorized Signatory)

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EX-31.1

Exhibit 31.1

CERTIFICATION

I, DAVID M. CORDANI, certify that:

1.I have reviewed this Quarterly Report on Form 10-Qof Cigna Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  August 6, 2020	/s/ David M. Cordani
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, ERIC P. PALMER, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Cigna Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  August 6, 2020	/s/ Eric P. Palmer
	Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification of Chief Executive Officer of

Cigna Corporation pursuant to 18 U.S.C. Section 1350

I certify that, to the best of my knowledge and belief, the Quarterly Report on Form 10-Q of Cigna Corporation for the fiscal period ending June 30, 2020 (the “Report”):

(1)complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Cigna Corporation.

/s/ David M. Cordani

David M. Cordani

Chief Executive Officer

August 6, 2020

EX-32.2

Exhibit 32.2

Certification of Chief Financial Officer of

Cigna Corporation pursuant to 18 U.S.C. Section 1350

I certify that, to the best of my knowledge and belief, the Quarterly Report on Form 10-Q of Cigna Corporation for the fiscal period ending June 30, 2020 (the “Report”):

(1)complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Cigna Corporation.

/s/ Eric P. Palmer

Eric P. Palmer

Chief Financial Officer

August 6, 2020

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2020	Jul. 31, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Fiscal Period Focus	Q2
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2020
Document Fiscal Year Focus	2020
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	1-38769
Entity Registrant Name	Cigna Corporation
Entity Central Index Key	0001739940
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	82-4991898
Entity Address, Address Line One	900 Cottage Grove Road
Entity Address, City or Town	Bloomfield
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06002
City Area Code	860
Local Phone Number	226-6000
Title of 12(b) Security	Common Stock, Par Value $0.01
Trading Symbol	CI
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		367,200,629

XML

Consolidated Statements of Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenues
Premiums	$ 10,406	$ 9,803	$ 21,246	$ 19,774
Net investment income	223	340	576	686
Total revenues	39,265	38,819	77,734	76,765
Benefits and expenses
Pharmacy and other service costs	25,611	24,963	49,801	49,013
Medical costs and other benefit expenses	7,112	7,576	15,434	15,196
Selling, general and administrative expenses	3,407	3,380	6,805	6,683
Amortization of acquired intangible assets	496	737	994	1,480
Total benefits and expenses	36,626	36,656	73,034	72,372
Income from operations	2,639	2,163	4,700	4,393
Interest expense and other	(374)	(428)	(765)	(880)
Debt extinguishment costs	(14)	0	(199)	0
Net realized investment gains (losses)	38	23	(50)	33
Income before income taxes	2,289	1,758	3,686	3,546
Total income taxes	529	348	737	764
Net income	1,760	1,410	2,949	2,782
Less: net income attributable to noncontrolling interests	6	2	14	6
Shareholders’ net income	$ 1,754	$ 1,408	$ 2,935	$ 2,776
Shareholders’ net income per share
Basic (in dollars per share)	$ 4.77	$ 3.73	$ 7.96	$ 7.33
Diluted (in dollars per share)	$ 4.73	$ 3.70	$ 7.88	$ 7.26
Pharmacy revenues
Revenues
Revenues	$ 26,564	$ 26,288	$ 51,662	$ 51,467
Fees and other revenues
Revenues
Revenues	$ 2,072	$ 2,388	$ 4,250	$ 4,838

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Comprehensive Income [Abstract]
Net income	$ 1,760	$ 1,410	$ 2,949	$ 2,782
Other comprehensive income, net of tax
Net unrealized appreciation on securities and derivatives	709	343	281	785
Net translation gains (losses) on foreign currencies	70	(42)	(105)	(68)
Postretirement benefits liability adjustment	(42)	14	(29)	25
Other comprehensive income, net of tax	737	315	147	742
Total comprehensive income	2,497	1,725	3,096	3,524
Comprehensive income (loss) attributable to noncontrolling interests
Net income attributable to redeemable noncontrolling interest	4	2	8	5
Net income attributable to other noncontrolling interests	2	0	6	1
Other comprehensive (loss) attributable to redeemable noncontrolling interest	(2)	(2)	(6)	(4)
Total comprehensive income attributable to noncontrolling interests	4	0	8	2
SHAREHOLDERS' COMPREHENSIVE INCOME	$ 2,493	$ 1,725	$ 3,088	$ 3,522

XML

Consolidated Balance Sheets - USD ($) $ in Millions		Jun. 30, 2020	Dec. 31, 2019
Assets
Cash and cash equivalents		$ 7,185	$ 4,619
Investments		1,190	937
Accounts receivable, net		12,694	10,716
Inventories		2,712	2,661
Other current assets		1,311	1,400
Assets of business held for sale		9,788	9,512
Total current assets		34,880	29,845
Long-term investments		21,338	21,542
Reinsurance recoverables		4,942	5,100
Deferred policy acquisition costs		3,042	2,958
Property and equipment		4,255	4,417
Goodwill		44,590	44,602
Other intangible assets		35,791	36,562
Other assets		2,529	2,283
Separate account assets		8,261	8,465
TOTAL ASSETS		159,628	155,774
Liabilities
Current insurance and contractholder liabilities		5,060	4,921
Pharmacy and service costs payable		11,856	10,454
Accounts payable		5,413	5,090
Accrued expenses and other liabilities		7,991	7,347
Short-term debt		4,750	5,514
Liabilities of business held for sale		7,109	6,812
Total current liabilities		42,179	40,138
Non-current insurance and contractholder liabilities		16,064	16,052
Deferred tax liabilities, net		9,170	9,387
Other non-current liabilities		4,775	4,460
Long-term debt		31,774	31,893
Separate account liabilities		8,261	8,465
TOTAL LIABILITIES		112,223	110,395
Contingencies — Note 18
Redeemable noncontrolling interests		34	35
Shareholders’ equity
Common stock	[1]	4	4
Additional paid-in capital		28,699	28,306
Accumulated other comprehensive loss		(788)	(941)
Retained earnings		23,052	20,162
Less: treasury stock, at cost		(3,601)	(2,193)
TOTAL SHAREHOLDERS’ EQUITY		47,366	45,338
Other noncontrolling interests		5	6
Total equity		47,371	45,344
Total liabilities and equity		$ 159,628	$ 155,774

[1] Par value per share, $0.01; shares issued, 389 million as of June 30, 2020 and 386 million as of December 31, 2019; authorized shares, 600 million.

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares issued (in shares)	389,000,000	386,000,000
Common stock, shares authorized (in shares)	600,000,000	600,000,000

XML

Consolidated Statements of Changes in Total Equity - USD ($) $ in Millions	Total	Adjustment upon Adoption		Shareholders’ Equity	Shareholders’ Equity Adjustment upon Adoption		Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive (Loss)	Retained Earnings	Retained Earnings Adjustment upon Adoption		Treasury Stock	Other Non- controlling Interests
Balance at Dec. 31, 2018	$ 41,035	$ (15)		$ 41,028	$ (15)		$ 4	$ 27,751	$ (1,711)	$ 15,088	$ (15)		$ (104)	$ 7
Changes in Total Equity
Effect of issuing stock for employee benefit plans	163			163				140					23
Other comprehensive income (loss)	746			746					746
Net income	2,777			2,776						2,776				1
Common dividends declared	(15)			(15)						(15)
Repurchase of common stock	(868)			(868)									(868)
Other transactions impacting noncontrolling interests	(5)													(5)
Balance at Jun. 30, 2019	43,818			43,815			4	27,891	(965)	17,834			(949)	3
Balance at Dec. 31, 2018	37
Change in Redeemable Noncontrolling Interests
Other comprehensive income (loss)	(4)
Net income	5
Other transactions impacting noncontrolling interests	(7)
Balance at Jun. 30, 2019	31
Balance at Dec. 31, 2018	41,035	(15)		41,028	(15)		4	27,751	(1,711)	15,088	(15)		(104)	7
Balance at Dec. 31, 2019	45,344	(30)	[1]	45,338	(30)	[1]	4	28,306	(941)	20,162	(30)	[1]	(2,193)	6
Balance at Dec. 31, 2018	37
Balance at Dec. 31, 2019	$ 35
Change in Redeemable Noncontrolling Interests
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member
Balance at Mar. 31, 2019	$ 42,413			42,408			4	27,855	(1,282)	16,426			(595)	5
Changes in Total Equity
Effect of issuing stock for employee benefit plans	88			88				36					52
Other comprehensive income (loss)	317			317					317
Net income	1,408			1,408						1,408
Repurchase of common stock	(406)			(406)									(406)
Other transactions impacting noncontrolling interests	(2)													(2)
Balance at Jun. 30, 2019	43,818			43,815			4	27,891	(965)	17,834			(949)	3
Balance at Mar. 31, 2019	38
Change in Redeemable Noncontrolling Interests
Other comprehensive income (loss)	(2)
Net income	2
Other transactions impacting noncontrolling interests	(7)
Balance at Jun. 30, 2019	31
Balance at Dec. 31, 2019	45,344	$ (30)	[1]	45,338	$ (30)	[1]	4	28,306	(941)	20,162	$ (30)	[1]	(2,193)	6
Changes in Total Equity
Effect of issuing stock for employee benefit plans	309			309				393					(84)
Other comprehensive income (loss)	153			153					153
Net income	2,941			2,935						2,935				6
Common dividends declared	(15)			(15)						(15)
Repurchase of common stock	(1,324)			(1,324)									(1,324)
Other transactions impacting noncontrolling interests	(7)													(7)
Balance at Jun. 30, 2020	47,371			47,366			4	28,699	(788)	23,052			(3,601)	5
Balance at Dec. 31, 2019	35
Change in Redeemable Noncontrolling Interests
Other comprehensive income (loss)	(6)
Net income	8
Other transactions impacting noncontrolling interests	(3)
Balance at Jun. 30, 2020	$ 34
Change in Redeemable Noncontrolling Interests
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member
Balance at Mar. 31, 2020	$ 45,086			45,079			4	28,554	(1,527)	21,298			(3,250)	7
Changes in Total Equity
Effect of issuing stock for employee benefit plans	139			139				145					(6)
Other comprehensive income (loss)	739			739					739
Net income	1,756			1,754						1,754				2
Repurchase of common stock	(345)			(345)									(345)
Other transactions impacting noncontrolling interests	(4)													(4)
Balance at Jun. 30, 2020	47,371			$ 47,366			$ 4	$ 28,699	$ (788)	$ 23,052			$ (3,601)	$ 5
Balance at Mar. 31, 2020	35
Change in Redeemable Noncontrolling Interests
Other comprehensive income (loss)	(2)
Net income	4
Other transactions impacting noncontrolling interests	(3)
Balance at Jun. 30, 2020	$ 34

[1] See Note 3 for further information about the Company's adoption of new credit loss guidance (ASU 2016-13).

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Consolidated Statements of Changes in Total Equity (Parenthetical) - $ / shares	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Statement of Stockholders' Equity [Abstract]
Common dividends declared (in dollars per share)	$ 0.04	$ 0.04

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Consolidated Statements of Cash Flows - USD ($) $ in Millions		6 Months Ended
		Jun. 30, 2020	Jun. 30, 2019
Cash Flows from Operating Activities
Net income		$ 2,949	$ 2,782
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		1,387	1,811
Realized investment losses (gains), net		50	(33)
Deferred income tax (benefit)		(259)	(241)
Debt extinguishment costs		199	0
Net changes in assets and liabilities, net of non-operating effects:
Accounts receivable		(2,121)	(1,165)
Inventories		(50)	524
Deferred policy acquisition costs		(177)	(99)
Reinsurance recoverable and Other assets		28	(177)
Insurance liabilities		483	297
Pharmacy and service costs payable		1,655	713
Accounts payable and Accrued expenses and other liabilities		630	(370)
Other, net		387	189
NET CASH PROVIDED BY OPERATING ACTIVITIES		5,161	4,231
Proceeds from investments sold:
Debt securities and equity securities		1,638	2,036
Investment maturities and repayments:
Debt securities and equity securities		765	738
Commercial mortgage loans		10	169
Other sales, maturities and repayments (primarily short-term and other long-term investments)		664	650
Investments purchased or originated:
Debt securities and equity securities		(2,150)	(2,212)
Commercial mortgage loans		(13)	(184)
Other (primarily short-term and other long-term investments)		(934)	(847)
Property and equipment purchases, net		(523)	(497)
Acquisitions, net of cash acquired		0	(6)
Other, net		37	(6)
NET CASH (USED IN) INVESTING ACTIVITIES		(506)	(159)
Cash Flows from Financing Activities
Deposits and interest credited to contractholder deposit funds		529	498
Withdrawals and benefit payments from contractholder deposit funds		(483)	(542)
Net change in short-term debt		(953)	(621)
Net proceeds on issuance of term loan		1,398	0
Payments for debt extinguishment		(212)	0
Repayment of long-term debt		(4,798)	(2,740)
Net proceeds on issuance of long-term debt		3,465	0
Repurchase of common stock		(1,324)	(866)
Issuance of common stock		229	70
Other, net		19	(106)
NET CASH (USED IN) FINANCING ACTIVITIES		(2,130)	(4,307)
Effect of foreign currency rate changes on cash, cash equivalents and restricted cash		(15)	(10)
Net increase (decrease) in cash, cash equivalents and restricted cash		2,510	(245)
Cash, cash equivalents, and restricted cash January 1,	[1]	5,411	3,855
Cash, cash equivalents and restricted cash, June 30,		7,921	3,610
Cash reclassified to assets of business held for sale		(418)	0
Cash, cash equivalents, and restricted cash March 31, per Consolidated Balance Sheets	[2]	7,503	3,610
Supplemental Disclosure of Cash Information:
Income taxes paid, net of refunds		190	1,190
Interest paid		$ 743	$ 865

[1] Includes restricted cash of $26 million reported in Other assets, $23 million in Long-term investments, and $743 million reported in Assets of business held for sale as of January 1, 2020.

[2] See table below for Cash, cash equivalents and restricted cash reconciliation as of June 30, 2020 and June 30, 2019.

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Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions		Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Cash and cash equivalents		$ 7,185	$ 4,619	$ 3,610
Restricted cash and cash equivalents, included in other long-term investments		318		0
Total cash, cash equivalents, and restricted cash and cash equivalents	[1]	$ 7,503		$ 3,610
Other Assets
Restricted cash and cash equivalents, included in other long-term investments			26
Long-Term Investments
Restricted cash and cash equivalents, included in other long-term investments			23
Assets Held for Sale
Restricted cash and cash equivalents, included in other long-term investments			$ 743

[1] See table below for Cash, cash equivalents and restricted cash reconciliation as of June 30, 2020 and June 30, 2019.

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Description of Business

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business

Description of Business

Cigna Corporation, together with its subsidiaries (either individually or collectively referred to as “Cigna,” the “Company,” “we,” “our” or “us”) is a global health service organization with a mission of helping those we serve improve their health, well-being and peace of mind. We offer a differentiated set of pharmacy, medical, dental, disability, life and accident insurance and related products and services offered by our subsidiaries.

The majority of these products are offered through employers and other groups such as governmental and non-governmental organizations, unions and associations. Cigna also offers commercial health and dental insurance, Medicare and Medicaid products and health, life and accident insurance coverages to individuals in the United States and selected international markets. In addition to these ongoing operations, Cigna also has certain run-off operations.

The Company reports its results in the following segments.

Health Services includes pharmacy benefits management, specialty pharmacy services, clinical solutions, home delivery and health management services.

Integrated Medical offers a variety of health care solutions to employers and individuals.

•The Commercial operating segment serves employers (also referred to as “clients”) and their employees (also referred to as “customers”) and other groups. This segment provides deeply integrated medical and specialty offerings including medical, pharmacy, dental, behavioral health and vision, health advocacy programs and other products and services to insured and self-insured clients.

•The Government operating segment offers Medicare Advantage, Medicare Supplement and Medicare Part D plans for seniors (including the acquired Express Scripts' Medicare Part D business), Medicaid plans, and individual health insurance coverage both on and off the public exchanges.

International Markets includes supplemental health, life and accident insurance products and health care coverage in our international markets, as well as health care benefits to globally mobile employees of multinational organizations.

The remainder of our business operations are reported in Group Disability and Other, consisting of the following:

•Group Disability and Life provides group long-term and short-term disability, group life, accident, voluntary and specialty insurance products and related services. In December 2019, Cigna entered into a definitive agreement to sell the U.S. Group Disability and Life insurance business to New York Life Insurance Company. See Note 6 for further information on the classification of this business as held for sale.

•Corporate-Owned Life Insurance (“COLI”) offers permanent insurance contracts sold to corporations to provide coverage on the lives of certain employees for the purpose of financing employer-paid future benefit obligations.

•Run-off businesses:

•Reinsurance: predominantly comprised of guaranteed minimum death benefit (“GMDB”) and guaranteed minimum income benefit (“GMIB”) business effectively exited through reinsurance with Berkshire Hathaway Life Insurance Company of Nebraska (“Berkshire”) in 2013.

•Settlement Annuity business in run-off.

•Individual Life Insurance and Annuity and Retirement Benefits Businesses: deferred gains from the sales of these businesses.

Corporate reflects amounts not allocated to operating segments, including interest expense, net investment income on investments not supporting segment and other operations, interest on uncertain tax positions, certain litigation matters, expense associated with our frozen pension plans, severance, certain enterprise-wide projects and intersegment eliminations for products and services sold between segments.

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COVID-19 and Related Economic Impact

6 Months Ended

Jun. 30, 2020

Unusual or Infrequent Items, or Both [Abstract]

COVID-19 and Related Economic Impact

COVID-19 and Related Economic Impact

Cigna continues to actively monitor all aspects of our business in light of the ongoing coronavirus ("COVID-19") pandemic. As described below, management has taken a number of steps to assess the impact on our business, including the financial reporting implications associated with this pandemic.

The COVID-19 pandemic has pervasively impacted the economy, financial markets and the global health care delivery systems during the second quarter, including significant deferral of care of our customers. These impacts were most prominent in April 2020 and moderated throughout the quarter with utilization levels returning to nearly normal levels by the end of June 2020. These impacts were most significant in our Integrated Medical segment where results reflect higher quarterly earnings and a lower medical care ratio as a result of the deferral of care significantly exceeding the incremental COVID-19 costs, partially offset by COVID-19 related actions including premium relief programs for clients as well as cost share waivers for customers. The Health Services segment quarterly earnings also reflected effects of the pandemic, specifically, a favorable mix of claims as a result of both the type of drugs dispensed as well as the distribution method used for dispensing and fulfilling, partially offset by lower non-specialty, 30-day retail script volume.

The Company conducted its normal quarterly qualitative assessment of goodwill impairment, and concluded that the current economic and business conditions did not result in a triggering event requiring a quantitative impairment analysis. All other long-lived assets, including intangible assets, were reviewed for impairment and no material impairments were recorded for the six months ended June 30, 2020.

The Company reviewed all classes of financial instruments including investments, accounts receivable and reinsurance recoverables, and recorded an additional allowance for expected credit losses of $48 million related to investments (see Note 11) and $13 million related to accounts receivable (see Note 4) for the six months ended June 30, 2020. The Company also initiated several actions to assist our customers, clients, health care providers, and employees in this time of crisis.

Additionally, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. The direct impact of this new legislation was not material to the Company's results of operations for the six months ended June 30, 2020. As permitted by the CARES Act and COVID-19 related regulatory actions, the Company deferred approximately $900 million in income and payroll tax payments during the second quarter of 2020. Approximately $825 million of the deferred tax payments will be made during the third quarter of 2020. The Company did not request any funding under the CARES Act. However, in April 2020 the Company received $41 million from the provider relief fund which was immediately returned to the U.S. Department of Health and Human Services.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Basis of Presentation

The Consolidated Financial Statements include the accounts of Cigna Corporation and its consolidated subsidiaries. Intercompany transactions and accounts have been eliminated in consolidation. These Consolidated Financial Statements were prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

Amounts recorded in the Consolidated Financial Statements necessarily reflect management’s estimates and assumptions about medical costs, investment and receivable valuations, interest rates and other factors. Significant estimates are discussed throughout these Notes; however, actual results could differ from those estimates. The impact of a change in estimate is generally included in earnings in the period of adjustment.

These interim Consolidated Financial Statements are unaudited but include all adjustments (including normal recurring adjustments) necessary, in the opinion of management, for a fair statement of financial position and results of operations for the periods reported. The interim Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes included in the 2019 Annual Report on Form 10-K (“2019 Form 10-K”). The preparation of interim Consolidated Financial Statements necessarily relies heavily on estimates. This and other factors, including the seasonal nature of portions of the health care and related benefits business, competitive and other market conditions, as well as COVID-19 related impacts, call for caution in estimating full-year results based on interim results of operations.

Recent Accounting Pronouncements

The Company's 2019 Form 10-K includes discussion of significant recent accounting pronouncements that either have impacted our financial statements or may impact them in the future. The following information provides updates on recently adopted or recently issued accounting pronouncements that have occurred since the Company filed its 2019 Form 10-K.

Recently Adopted Accounting Guidance

Accounting Standard and Adoption Date	Requirements and Effects of Adopting New Guidance
Measurement of Credit Losses on Financial Instruments (Accounting Standards Update (ASU) 2016-13 and related amendments) Adopted as of January 1, 2020	Requires:
	•	A new approach using expected credit losses to estimate and recognize credit losses for certain financial instruments (such as mortgage loans, reinsurance recoverables and other receivables) when such instruments are first originated or acquired, and in each subsequent reporting period, compared with the incurred loss model previously followed under GAAP. At adoption, the Company recorded an allowance for estimated credit losses and subsequent changes in the allowance will be reported in current period earnings.
	•	Changes in the criteria for impairment of available-for-sale debt securities
	Effects of adoption:
	•	Adopted using a modified retrospective approach
	•	Cumulative effect adjustment of $30 million after-tax was recorded as a reduction to retained earnings as of January 1, 2020, reflecting an additional allowance for future expected credit losses required under the new model, primarily related to reinsurance recoverables.
	•	See additional information regarding the Company’s accounting policy for establishing the allowance for credit losses in Note 4, Accounts Receivable, Net, Note 10, Reinsurance, and Note 11, Investments.
Simplifying the Test for Goodwill Impairment (ASU 2017-04) Adopted as of January 1, 2020	Requires:
	•	A simplified approach to the accounting for goodwill impairment by eliminating the need to determine the fair value of individual assets and liabilities of a reporting unit to measure a goodwill impairment
	•	The amount of goodwill impairment to equal the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the total amount of goodwill of the reporting unit
	Effects of adoption:
	•	Adopted on a prospective basis
	•	There was no impact of adopting this new standard to the Company’s financial statements because our quarterly qualitative assessments did not result in a triggering event for impairment of goodwill.

Accounting Guidance Not Yet Adopted

Accounting Standard and Effective Date	Requirements and Expected Effects of New Guidance Not Yet Adopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASU 2020-04) Optional, effective upon issuance (March 12, 2020) through December 31, 2022	Guidance:
	•	Provides temporary optional relief to ease the potential burden of accounting for reference rate reform under existing GAAP. Amendments are elective and apply to all entities that have contracts, hedging relationships and other transactions that reference interbank offered rates, including LIBOR, expected to be discontinued by December 31, 2021.
	•	Permits optional expedients and exceptions to simplify the accounting for contract modifications, hedging arrangements and held-to-maturity investments, when certain changes are made to a contract or instrument to facilitate reference rate reform.
	•	An entity may elect to apply the amendments, by topic or subsection, at any point prospectively through December 31, 2022. When elected, the optional expedients must be applied consistently for all eligible contracts or transactions.
	Expected effects:
	•	To date, the Company has identified minimal exposure to LIBOR and does not anticipate that LIBOR’s phase-out will have a material impact on its operations or financial results.

The Financial Accounting Standards Board voted to propose the deferral of the effective date of ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts and, in July 2020, issued a proposed standard for comment extending the effective date by one year, or until January 1, 2023 for the Company.

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Accounts Receivable, Net

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

Accounts Receivable, Net

Accounts Receivable, Net

Accounting policy. The Company's accounts receivable balances primarily include amounts due from clients, third-party payors, customers and pharmaceutical manufacturers, and are presented net of allowances. The Company's adoption of ASU 2016-13, Measurement of Credit Losses on Financial Instruments (ASU 2016-13), as of January 1, 2020 did not have a material impact on our accounts receivable credit loss allowance, as there were no substantive changes to our methodology for this class of assets. The allowance for expected credit losses for current accounts receivable is based primarily on past collections experience relative to the length of time receivables are past due; however, when available evidence reasonably supports an assumption that counterparty credit risk over the expected payment period will differ from current and historical payment collections, a forecasting adjustment is reflected in the allowance for expected credit losses.

All other (non-credit) allowances are based on the current status of each customer's receivable balance as well as current economic and market conditions and a variety of other factors, including the length of time the receivables are past due, the financial health of customers and our past experience. We bill pharmaceutical manufacturers based on management's interpretation of contractual terms and estimate a contractual allowance based on the best information available at the time a claim is processed. Contractual allowances for certain rebates receivable from pharmaceutical manufacturers are determined by reviewing payment experience and specific known items that could be adjusted under contract terms. The Company's estimation process for contractual allowances for pharmaceutical manufacturer receivables generally results in an allowance for balances outstanding greater than 90 days.

Contractual allowances for certain receivables from third-party payors are based on their contractual terms and are estimates based on the Company's best information available at the time revenue is recognized.

Receivables and any associated allowance are written off only when all collection attempts have failed and such amounts are determined unrecoverable. We regularly review the adequacy of these allowances based on a variety of factors, including age of the outstanding receivable and collection history. When circumstances related to specific collection patterns change, estimates of the recoverability of receivables are adjusted.

The following amounts were included within accounts receivable, net:

(In millions)	June 30, 2020		December 31, 2019
Noninsurance customer receivables	$	5,678	$	5,143
Pharmaceutical manufacturers receivable	4,654		3,439
Insurance customer receivables	2,607		2,321
Other receivables	386		334
Total	13,325		11,237
Accounts receivable, net classified as assets of business held for sale	(631)		(521)
Accounts receivable, net per Consolidated Balance Sheets	$	12,694	$	10,716

These receivables are reported net of our allowances of $1.1 billion as of June 30, 2020 and $778 million as of December 31, 2019. These allowances include contractual allowances for certain rebates receivable with pharmaceutical manufacturers and certain receivables from third-party payors, discounts and claims adjustments issued to customers in the form of client credits, an allowance for the balance of our risk corridor receivables under the Patient Protection and Affordable Care Act ("ACA"), an allowance for current expected credit losses and other non-credit adjustments. The Company's allowance for current expected credit losses was $72 million as of June 30, 2020 and $39 million as of January 1, 2020 (no change to allowance for credit losses from December 31, 2019). The allowance for current expected credit losses as of June 30, 2020 includes an additional forecasting adjustment of $13 million related to COVID-19.

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Mergers and Acquisitions

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Mergers and Acquisitions

Mergers and Acquisitions

Integration and Transaction-related Costs

The Company incurred integration and transaction costs related to the acquisition and integration of Express Scripts, the terminated merger with Anthem, Inc. (“Anthem”), the sale of the U.S. Group Disability and Life insurance business, and other transactions. These costs were $130 million pre-tax ($99 million after-tax) for the three months and $227 million pre-tax ($173 million after tax) for the six months ended June 30, 2020, compared with $155 million pre-tax ($115 million after-tax) for the three months and $291 million pre-tax ($223 million after-tax) for the six months ended June 30, 2019. These costs consisted primarily of certain projects to integrate or separate the Company’s systems, products and services, fees for legal, advisory and other professional services and certain employment-related costs.

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Assets and Liabilities of Business Held for Sale

6 Months Ended

Jun. 30, 2020

Discontinued Operations and Disposal Groups [Abstract]

Assets and Liabilities of Business Held for Sale

Assets and Liabilities of Business Held for Sale

In December 2019, Cigna entered into a definitive agreement to sell its U.S. Group Disability and Life insurance business to New York Life Insurance Company for $6.3 billion. The sale is expected to close in the third quarter of 2020 following applicable regulatory approvals and other customary closing conditions. The Company believes this sale is probable and has aggregated and classified the assets and liabilities directly associated with the pending sale of its Group Disability and Life insurance business as held for sale and has reported them separately on our Consolidated Balance Sheets as of June 30, 2020 and December 31, 2019. The assets and liabilities of business held for sale were as follows:

(In millions)	June 30, 2020		December 31, 2019
Cash and cash equivalents	$	418	$	743
Accounts receivable, net	631		521
Investments	8,181		7,709
Other assets	558		539
Total assets of business held for sale	9,788		9,512
Insurance and contractholder liabilities	6,549		6,308
Other liabilities	560		504
Total liabilities of business held for sale	$	7,109	$	6,812

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Earnings Per Share

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share (“EPS”)

Basic and diluted earnings per share were computed as follows:

	Three Months Ended
	June 30, 2020						June 30, 2019
(Shares in thousands, dollars in millions, except per share amounts)	Basic		Effect of Dilution		Diluted		Basic		Effect of Dilution		Diluted
Shareholders’ net income	$	1,754			$	1,754	$	1,408			$	1,408
Shares:
Weighted average	367,396				367,396		377,962				377,962
Common stock equivalents			3,301		3,301				3,007		3,007
Total shares	367,396		3,301		370,697		377,962		3,007		380,969
EPS	$	4.77	$	(0.04)	$	4.73	$	3.73	$	(0.03)	$	3.70

	Six Months Ended
	June 30, 2020						June 30, 2019
(Shares in thousands, dollars in millions, except per share amounts)	Basic		Effect of Dilution		Diluted		Basic		Effect of Dilution		Diluted
Shareholders’ net income	$	2,935			$	2,935	$	2,776			$	2,776
Shares:
Weighted average	368,918				368,918		378,672				378,672
Common stock equivalents			3,750		3,750				3,824		3,824
Total shares	368,918		3,750		372,668		378,672		3,824		382,496
EPS	$	7.96	$	(0.08)	$	7.88	$	7.33	$	(0.07)	$	7.26

The following outstanding employee stock options were not included in the computation of diluted earnings per share because their effect was anti-dilutive.

	Three Months Ended June 30,		Six Months Ended June 30,
(In millions)	2020	2019	2020	2019
Anti-dilutive options	4.0	5.4	4.0	4.1

The Company held approximately 20.8 million shares of common stock in treasury at June 30, 2020, 13.0 million shares as of December 31, 2019 and 6.2 million shares as of June 30, 2019.

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Debt

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Debt

Debt

The outstanding amounts of debt and finance leases were as follows:

(In millions)	June 30, 2020		December 31, 2019
Short-term debt
$1,000 million, Floating Rate Notes due 3/2020	$	—	$	999
$300 million, 5.125% Notes due 6/2020	—		300
$1,750 million, 3.2% Notes due 9/2020	1,750		1,748
$349 million, 4.125% Notes due 9/2020	349		351
$500 million, 2.6% Notes due 11/2020	498		496
$400 million, Floating Rate Notes due 11/2020	400		400
$250 million, 4.375% Notes due 12/2020	250		249
$1,400 million, Floating Rate Term Loan due 3/2021	1,398		—
$78 million, 6.37% Notes due 6/2021	78		—
Commercial paper	5		944
Other, including finance leases	22		27
Total short-term debt	$	4,750	$	5,514
Long-term debt
$500 million, 3.3% Notes due 2021	$	—	$	499
$300 million, 4.5% Notes due 2021	—		298
$78 million, 6.37% Notes due 2021	—		78
$1,000 million, Floating Rate Notes due 2021	998		998
$1,250 million, 3.4% Notes due 2021	1,248		1,247
$1,248 million, 4.75% Notes due 2021	—		1,272
$277 million, 4% Notes due 2022	276		747
$973 million, 3.9% Notes due 2022	972		999
$500 million, 3.05% Notes due 2022	488		485
$17 million, 8.3% Notes due 2023	17		17
$63 million, 7.65% Notes due 2023	63		100
$700 million, Floating Rate Notes due 2023	698		698
$1,000 million, 3% Notes due 2023	971		966
$2,187 million, 3.75% Notes due 2023	2,180		3,088
$1,000 million, 3.5% Notes due 2024	974		970
$900 million, 3.25% Notes due 2025	895		895
$2,200 million, 4.125% Notes due 2025	2,189		2,188
$1,500 million, 4.5% Notes due 2026	1,505		1,506
$1,500 million, 3.4% Notes due 2027	1,404		1,396
$259 million, 7.875% Debentures due 2027	259		259
$600 million, 3.05% Notes due 2027	595		595
$3,800 million, 4.375% Notes due 2028	3,778		3,776
$1,500 million, 2.4% Notes due 2030	1,489		—
$45 million, 8.3% Step Down Notes due 2033	45		45
$190 million, 6.15% Notes due 2036	190		190
$2,200 million, 4.8% Notes due 2038	2,179		2,178
$750 million, 3.2% Notes due 2040	742		—
$121 million, 5.875% Notes due 2041	119		119
$448 million, 6.125% Notes due 2041	490		491
$317 million, 5.375% Notes due 2042	315		315
$1,500 million, 4.8% Notes due 2046	1,464		1,465
$1,000 million, 3.875% Notes due 2047	988		988
$3,000 million, 4.9% Notes due 2048	2,965		2,964
$1,250 million, 3.4% Notes due 2050	1,235		—
Other, including finance leases	43		61
Total long-term debt	$	31,774	$	31,893

Debt issuance and redemption. In order to decrease future interest expense and reduce future refinancing risk, the Company entered into the following transactions:

•Debt issuance: On March 16, 2020, the Company issued $3.5 billion of new senior notes. The proceeds of this debt were mainly used to pay the consideration for the cash tender and redemption offer as described below. Interest on this debt is paid semi-annually.

Principal	Maturity Date	Interest Rate	Net Proceeds
$1,500 million	March 15, 2030	2.40%	$1,491 million
$750 million	March 15, 2040	3.20%	$743 million
$1,250 million	March 15, 2050	3.40%	$1,237 million

•Debt tender and redemption: In March and April 2020, the Company completed a tender offer and an optional redemption totaling $3.5 billion of aggregate principal amount of certain of its outstanding debt securities. The principal amount repurchased in this tender offer was $1.5 billion. Additionally, $2.0 billion of notes were repurchased via optional redemption. The Company recorded a pre-tax loss of $199 million ($151 million after-tax), consisting primarily of premium payments on the tender and optional redemption.

Debt Exchange. In the fourth quarter of 2019, the Company settled an exchange of approximately $12.7 billion of Notes issued by Express Scripts Holding Company, Medco Health Solutions, Inc. and Cigna Holding Company (formerly named Cigna Corporation) for privately placed Notes issued by Cigna with the same interest rates and maturities and comparable other terms. We initiated an exchange offer to register such debt in the second quarter of 2020 and completed the exchange in July 2020.

Debt Repayment. During the first six months of 2020, the Company repaid $4.8 billion of long-term debt, including the $3.5 billion debt tender and redemption described above.

Revolving Credit Agreements. Cigna has a revolving credit and letter of credit agreement that matures in April 2023 and is diversified among 23 banks. Cigna can borrow up to $3.25 billion for general corporate purposes, with up to $500 million available for issuance of letters of credit. This revolving credit agreement also includes an option to increase the facility amount up to $500 million and an option to extend the termination date for additional one year periods, subject to consent of the banks.

In the fourth quarter of 2019, the Company entered into an additional 364-day revolving credit agreement that matures in October 2020 and is diversified among 23 banks. Pursuant to this revolving credit agreement, Cigna can borrow up to $1.0 billion for general corporate purposes. The agreement includes the option to “term out” any revolving loans that are outstanding at maturity by converting them into a term loan maturing on the one year anniversary of conversion.

The revolving credit agreements contain customary covenants and restrictions including a financial covenant that the Company’s leverage ratio may not exceed 60%. As of June 30, 2020, there were no outstanding balances under the revolving credit agreements.

Term Loan Credit Agreement. On April 1, 2020, the Company borrowed an aggregate principal amount of $1.4 billion under a new 364-Day Term Loan Credit Agreement (the "Credit Agreement"). The Company entered into the Credit Agreement to enhance its liquidity position in light of disruption in the commercial paper market and used a portion of the net proceeds to pay down amounts outstanding under its commercial paper facility. The Credit Agreement may be prepaid at any time in whole or in part without premium or penalty. Term loans prepaid may not be reborrowed. The Credit Agreement provides for mandatory prepayment of the term loans in an amount equal to 20% of any Net Cash Proceeds (as defined in the Credit Agreement) arising from the previously announced sale of Cigna’s U.S. Group Disability and Life insurance business to New York Life Insurance Company.

Commercial Paper. The commercial paper program had approximately $5 million outstanding at June 30, 2020 at an average interest rate of 1.0%.

The Company was in compliance with its debt covenants as of June 30, 2020.

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Insurance and Contractholder Liabilities

6 Months Ended

Jun. 30, 2020

Insurance Loss Reserves [Abstract]

Insurance and Contractholder Liabilities

Insurance and Contractholder Liabilities

A.Account Balances – Insurance and Contractholder Liabilities

As of June 30, 2020, December 31, 2019 and June 30, 2019, the Company’s insurance and contractholder liabilities were comprised of the following:

	June 30, 2020						December 31, 2019						June 30, 2019
(In millions)	Current		Non-current		Total		Current		Non-current		Total		Total
Contractholder deposit funds	$	627	$	7,062	$	7,689	$	600	$	7,139	$	7,739	$	7,883
Future policy benefits	528		9,417		9,945		553		9,281		9,834		9,715
Unpaid claims and claim expenses
Integrated Medical	2,942		17		2,959		2,875		17		2,892		2,881
Other segments	2,551		3,599		6,150		2,529		3,474		6,003		5,793
Unearned premiums	561		369		930		453		360		813		776
Total	7,209		20,464		27,673		7,010		20,271		27,281		27,048
Insurance and contractholder liabilities classified as liabilities of business held for sale(1)	(2,149)		(4,400)		(6,549)		(2,089)		(4,219)		(6,308)
Total insurance and contractholder liabilities	$	5,060	$	16,064	$	21,124	$	4,921	$	16,052	$	20,973	$	27,048

⁽¹⁾ Amounts classified as Liabilities of business held for sale primarily include $5.1 billion of unpaid claims, $758 million of contractholder deposit funds and $644 million of future policy benefits as of June 30, 2020 and $4.9 billion of unpaid claims, $717 million of contractholder deposit funds and $653 million of future policy benefits as of December 31, 2019.

Insurance and contractholder liabilities expected to be paid within one year are classified as current.

B.Unpaid Claims and Claim Expenses – Integrated Medical

This liability reflects estimates of the ultimate cost of claims that have been incurred but not reported, including expected development on reported claims, those that have been reported but not yet paid (reported claims in process), and other medical care expenses and services payable that are primarily comprised of accruals for incentives and other amounts payable to health care professionals and facilities.

The total of incurred but not reported liabilities plus expected development on reported claims, including reported claims in process, was $2.7 billion at June 30, 2020 and June 30, 2019.

Activity, net of intercompany transactions, in the unpaid claims liability for the Integrated Medical segment for the six months ended June 30 was as follows:

	Six Months Ended
(In millions)	June 30, 2020		June 30, 2019
Beginning balance	$	2,892	$	2,697
Less: Reinsurance and other amounts recoverable	303		264
Beginning balance, net	2,589		2,433
Incurred costs related to:
Current year	12,212		12,120
Prior years	(130)		(149)
Total incurred	12,082		11,971
Paid costs related to:
Current year	9,585		9,629
Prior years	2,284		2,134
Total paid	11,869		11,763
Ending balance, net	2,802		2,641
Add: Reinsurance and other amounts recoverable	157		240
Ending balance	$	2,959	$	2,881

Reinsurance and other amounts recoverable reflect amounts due from reinsurers and policyholders to cover incurred but not reported and pending claims of certain business for which the Company administers the plan benefits without any right of offset. See Note 10 for additional information on reinsurance.

Variances in incurred costs related to prior years’ unpaid claims and claims expenses that resulted from the differences between actual experience and the Company’s key assumptions for the six months ended June 30 were as follows:

	Six Months Ended
(Dollars in millions)	June 30, 2020				June 30, 2019
	$		%(1)		$		%(2)
Actual completion factors	$	50	0.2	%	$	91	0.4	%
Medical cost trend	80		0.3		58		0.3
Total favorable variance	$	130	0.5	%	$	149	0.7	%

(1)Percentage of current year incurred costs as reported for the year ended December 31, 2019.

(2)Percentage of current year incurred costs as reported for the year ended December 31, 2018.

Incurred costs related to prior years in the table above, although adjusted through shareholders’ net income, do not directly correspond to an increase or decrease to shareholders’ net income. The primary reason for this difference is that decreases to prior year incurred costs pertaining to the portion of the liability established for moderately adverse conditions are not considered as impacting shareholders’ net income if they are offset by increases in the current year provision for moderately adverse conditions.

Prior year development increased shareholders’ net income by $44 million ($56 million before-tax) for the six months ended June 30, 2020, compared with $62 million ($78 million before-tax) for the six months ended June 30, 2019. Favorable prior year development in both periods reflects lower than expected utilization of medical services.

C.Unpaid Claims and Claim Expenses – Group Disability and Other and International Markets

Liability balance details. The liability details for unpaid claims and claim expenses are as follows:

(In millions)	June 30, 2020 (1)		June 30, 2019
Group Disability and Other
Group Disability and Life	$	5,165	$	4,827
Other Operations	160		195
Total Group Disability and Other	5,325		5,022
International Markets	825		771
Unpaid claims and claim expenses Group Disability and Other and International Markets	$	6,150	$	5,793

⁽¹⁾ Includes unpaid claim amounts classified as Liabilities of business held for sale.

Activity in the Company’s liabilities for unpaid claims and claim expenses, excluding Other Operations, are presented in the following table. Liabilities associated with Other Operations are excluded because they pertain to obligations for long-duration insurance contracts or, if short-duration, the liabilities have been fully reinsured.

	Six Months Ended
(In millions)	June 30, 2020(1)		June 30, 2019
Beginning balance	$	5,816	$	5,432
Less: Reinsurance	184		156
Beginning balance, net	5,632		5,276
Incurred claims related to:
Current year	2,829		2,814
Prior years:
Interest accretion	81		81
All other incurred	(8)		(42)
Total incurred	2,902		2,853
Paid claims related to:
Current year	1,357		1,415
Prior years	1,353		1,275
Total paid	2,710		2,690
Foreign currency	(14)		(16)
Ending balance, net	5,810		5,423
Add: Reinsurance	180		175
Ending balance	$	5,990	$	5,598

⁽¹⁾ Includes Unpaid claims amounts classified as Liabilities of business held for sale.

Reinsurance in the table above reflects amounts due from reinsurers related to unpaid claims liabilities. The Company’s insurance subsidiaries enter into agreements with other companies primarily to limit losses from large exposures and to permit recovery of a portion of incurred losses. See Note 10 for additional information on reinsurance.

The majority of the liability for unpaid claims and claim expenses is related to disability claims with long-tailed payouts that relate to a business held for sale. Interest earned on assets backing these liabilities is an integral part of pricing and reserving. Therefore, interest accreted on prior year balances is shown as a separate component of prior

year incurred claims and reported in Medical costs and other benefit expenses in the income statement. This interest is calculated by applying the average discount rate used in determining the liability balance to the average liability balance over the period. The remaining prior year incurred claims amount primarily reflects updates to the Company’s liability estimates and variances between actual experience during the period relative to the assumptions and expectations reflected in determining the liability. Assumptions reflect the Company’s expectations over the life of the book of business and will vary from actual experience in any period, both favorably and unfavorably, with variation in resolution rates being the most significant driver for the long-term disability business. Favorable prior year incurred claims for the six months ended June 30, 2020 primarily reflected favorable experience in Europe and the Middle East and favorable Voluntary and Life incidence, partially offset by unfavorable long-term disability resolution rate experience relative to expectations reflected in the prior year reserve. Favorable prior year incurred claims for the six months ended June 30, 2019 primarily reflected favorable life and voluntary loss ratio experience relative to expectations reflected in the prior year reserve.

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Reinsurance

6 Months Ended

Jun. 30, 2020

Reinsurance Disclosures [Abstract]

Reinsurance

Reinsurance

The Company’s insurance subsidiaries enter into agreements with other insurance companies to assume and cede reinsurance. Reinsurance is ceded primarily in acquisition and disposition transactions when the underwriting company is not being acquired. Reinsurance is also used to limit losses from large exposures and to permit recovery of a portion of direct or assumed losses. Reinsurance does not relieve the originating insurer of liability. Therefore, reinsured liabilities must continue to be reported along with the related reinsurance recoverables. The Company regularly evaluates the financial condition of its reinsurers and monitors concentrations of its credit risk.

A.Reinsurance Recoverables

Accounting policy. Reinsurance recoverables represent amounts due from reinsurers for both paid and unpaid claims of the Company’s insurance businesses. Most reinsurance recoverables are classified as non-current assets. The current portion of reinsurance recoverables is reported in Other current assets and consists primarily of recoverables on paid claims expected to be settled within one year. Reinsurance recoverables are presented net of allowances for uncollectible reinsurance that, effective with adopting ASU 2016-13 on January 1, 2020, consists primarily of an allowance for expected credit losses. Estimates of the allowance for expected credit losses are based on internal and external data used to develop expected loss rates over the anticipated duration of the recoverable asset that vary by external credit rating and collateral level. The Company's allowance for credit losses on reinsurance recoverables was $34 million as of June 30, 2020, of which $31 million was through a cumulative effect adjustment to retained earnings at adoption.

The majority of the Company’s reinsurance recoverables resulted from acquisition and disposition transactions in which the underwriting company was not acquired. Included in the table below is $224 million of current reinsurance recoverables that are reported in Other current assets as of June 30, 2020; as of December 31, 2019 there was $222 million of current reinsurance recoverables reported in Other current assets. The Company’s reinsurance recoverables are presented in the following table by range of external credit rating and collateral level.

(Dollars in millions)	Fair value of collateral contractually required to meet or exceed carrying value of recoverable		Collateral provisions exist that may mitigate risk of credit loss (3)		No collateral		Total
Ongoing Operations
Upper-medium grade and higher (1)	$	—	$	6	$	311	$	317
Lower-medium grade (2)	—		—		66		66
Not rated	89		14		17		120
Total recoverables related to ongoing operations (3)	$	89	$	20	$	394	$	503
Acquisition, disposition or runoff activities
Upper-medium grade and higher (1)
Lincoln National Life and Lincoln Life & Annuity of New York	—		3,064		—		3,064
Berkshire	329		493		—		822
Prudential Retirement Insurance and Annuity	660		—		—		660
Other	241		21		19		281
Not rated	—		40		3		43
Total recoverables related to acquisition, disposition or runoff activities	1,230		3,618		22		4,870
Total	$	1,319	$	3,638	$	416	$	5,373
Allowance for uncollectible reinsurance							(34)
Reinsurance recoverables classified as assets of business held for sale							(173)
Total reinsurance recoverables							$	5,166
(1) Includes A- equivalent and higher current ratings certified by a nationally recognized statistical rating organization ('NRSRO')
(2) Includes BBB- to BBB+ equivalent current credit ratings certified by a NRSRO
(3) This includes collateral provisions requiring the reinsurer to fully collateralize its obligation if its external credit rating is downgraded to a specified level

Collateral levels are defined internally based on the fair value of the collateral relative to the carrying amount of the reinsurance recoverable, the frequency at which collateral is required to be replenished and the potential for volatility in the collateral’s fair value. The Company bears the risk of loss if its reinsurers and retrocessionaires do not meet or are unable to meet their reinsurance obligations to the Company. The Company reviews its reinsurance arrangements and establishes reserves against the recoverables, as further described above.

B.Effects of Reinsurance

In the Company’s Consolidated Statements of Income, premiums were reported net of amounts ceded to reinsurers and medical costs and other benefit expenses were reported net of reinsurance recoveries in the following amounts:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Total ceded premiums	$	117	$	126	$	245	$	256
Total reinsurance recoveries	$	102	$	53	$	280	$	112

C.Effective Exit of GMDB and GMIB Business

The Company entered into an agreement with Berkshire to effectively exit the GMDB and GMIB business via a reinsurance transaction in 2013. Berkshire reinsured 100% of the Company’s future claim payments in this business, net of other reinsurance arrangements existing at that time. The reinsurance agreement is subject to an overall limit with approximately $3.3 billion remaining at June 30, 2020.

GMDB is accounted for as assumed and ceded reinsurance and GMIB assets and liabilities are reported as derivatives at fair value as discussed below. GMIB assets are reported in Other current assets and Other assets, and GMIB liabilities are reported in Accrued expenses and other liabilities and Other non-current liabilities.

GMDB

The GMDB exposure arises under annuities written by ceding companies that guarantee the benefit received at death. The Company’s exposure arises when the guaranteed minimum death benefit exceeds the fair value of the related mutual fund investments at the time of a contractholder’s death.

The following table presents the account value, net amount at risk and the number of contractholders for guarantees assumed by the Company in the event of death. The net amount at risk is the amount that the Company would have to pay if all contractholders died as of the specified date. The Company should be reimbursed in full for these payments unless the Berkshire reinsurance limit is exceeded.

(Dollars in millions, excludes impact of reinsurance ceded)	June 30, 2020		December 31, 2019
Account value	$	8,424	$	9,110
Net amount at risk	$	1,776	$	1,764
Number of contractholders (estimated)	190,000		200,000

GMIB

The Company reinsured contracts with issuers of GMIB products. The Company’s exposure represents the excess of a contractually guaranteed amount over the level of variable annuity account values. Payment by the Company depends on the actual account value in the related underlying mutual funds and the level of interest rates when the contractholders elect to receive minimum income payments that can only occur within 30 days of a policy

anniversary after the appropriate waiting period. The Company has purchased retrocessional coverage (“GMIB assets”) for these contracts including retrocessional coverage from Berkshire.

Assumptions used in fair value measurement. GMIB assets and liabilities are established using capital market assumptions and assumptions related to future annuitant behavior (including mortality, lapse, and annuity election rates). The Company classifies GMIB assets and liabilities in Level 3 of the fair value hierarchy described in Note 12 because assumptions related to future annuitant behavior are largely unobservable.

The only assumption expected to impact future shareholders’ net income is non-performance risk. The non-performance risk adjustment reflects a market participant’s view of nonpayment risk by adding an additional spread to the discount rate in the calculation of both (a) the GMIB liabilities to be paid by the Company, and (b) the GMIB assets to be paid by the reinsurers, after considering collateral. The impact of non-performance risk was immaterial for the three and six months ended June 30, 2020 and June 30, 2019.

GMIB liabilities totaling $838 million as of June 30, 2020 and $688 million as of December 31, 2019 were reported in Accrued expenses and other liabilities and Other non-current liabilities. There were three reinsurers covering 100% of the GMIB exposures as of June 30, 2020 and December 31, 2019 as follows:

(In millions)
Line of Business	Reinsurer	June 30, 2020		December 31, 2019		Collateral and Other Terms at June 30, 2020
GMIB	Berkshire	$	404	$	332	100% were secured by assets in a trust.
	Sun Life Assurance Company of Canada	249		202
	Liberty Re (Bermuda) Ltd.	218		179		96% were secured by assets in a trust.
Total GMIB recoverables reported in Other current assets and Other assets		$	871	$	713

Amounts included in shareholders’ net income for GMIB assets and liabilities were not material for the three or six months ended June 30, 2020 or June 30, 2019.

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Investments

6 Months Ended

Jun. 30, 2020

Investments [Abstract]

Investments

Investments

Cigna’s investment portfolio consists of a broad range of investments including debt securities, equity securities, commercial mortgage loans, policy loans, other long-term investments, short-term investments and derivative financial instruments. The sections below provide more detail regarding our investment balances and realized investment gains and losses. See Note 12 for information about the valuation of the Company’s investment portfolio. The following table summarizes the Company's investments by category and current or long-term classification.

	June 30, 2020						December 31, 2019
(In millions)	Current		Long-term		Total		Current		Long-term		Total
Debt securities	$	1,046	$	22,628	$	23,674	$	928	$	22,827	$	23,755
Equity securities	—		373		373		—		303		303
Commercial mortgage loans	—		1,942		1,942		—		1,947		1,947
Policy loans	—		1,364		1,364		—		1,357		1,357
Other long-term investments	—		2,900		2,900		—		2,403		2,403
Short-term investments	456		—		456		423		—		423
Total	$	1,502	$	29,207	$	30,709	$	1,351	$	28,837	$	30,188
Investments classified as assets of business held for sale(1)	(312)		(7,869)		(8,181)		(414)		(7,295)		(7,709)
Investments per Consolidated Balance Sheets	$	1,190	$	21,338	$	22,528	$	937	$	21,542	$	22,479
(1) The table above includes $8.2 billion as of June 30, 2020 and $7.7 billion as of December 31, 2019 of investments associated with the U.S. Group Disability and Life business that are held for sale to New York Life. Under the terms of the definitive agreement, some of the assets currently associated with the Group Disability and Life business can be substituted for other assets. The assets that will transfer to New York Life will be primarily debt securities and to a lesser extent commercial mortgage loans and short-term investments.

A.Investment Portfolio

Debt Securities

Accounting policy. Debt securities (including bonds, mortgage and other asset-backed securities and preferred stocks redeemable by the investor) are classified as available for sale and are carried at fair value with changes in fair value recorded either in Accumulated other comprehensive income (loss) within Shareholders’ equity or in credit loss expense based on fluctuations in the allowance for credit losses, as further discussed below. Net unrealized appreciation on debt securities supporting the Company’s run-off settlement annuity business is reported in Non-current insurance and contractholder liabilities rather than Accumulated other comprehensive income (loss). When the Company intends to sell or determines that it is more likely than not to be required to sell an impaired debt security, the excess of amortized cost over fair value is directly written down with a charge to Realized investment gains and losses.

As of January 1, 2020, the Company adopted ASU 2016-13 that included certain targeted improvements to the accounting for available-for-sale debt securities. The new guidance resulted in certain policy changes related to the process used by the Company to review declines in fair value from a security’s amortized cost basis to determine whether a credit loss exists. For example, the length of time that a debt security has been impaired is no longer a criterion for this review. In addition, under this new guidance, the Company recognizes an allowance for credit loss with a corresponding charge to credit loss expense, presented in Realized investment gains and losses in the Company’s income statement. Prior to this new guidance, the Company recorded a direct write-down of the instrument’s amortized cost basis. The allowance for credit loss represents the excess of amortized cost over the greater of its fair value or the net present value of the debt security's projected future cash flows (based on

qualitative and quantitative factors, including the probability of default, and the estimated timing and amount of recovery). Each period, the allowance for credit loss is adjusted through credit loss expense.

The Company elected the expedient to not measure an allowance for credit losses for accrued interest receivables. Consistent with prior practice, when interest payments are delinquent based on contractual terms or when certain terms (interest rate or maturity date) of the investment have been restructured, accrued interest, reported in Other current assets, is written off through a charge to Net investment income, and interest income is recognized on a cash basis.

Debt securities are classified as either Current or Long-term investments based on their contractual maturities.

Review of declines in fair value. Management reviews impaired debt securities to determine whether a credit loss allowance is needed based on criteria that include:

•severity of decline;

•financial health and specific prospects of the issuer; and

•changes in the regulatory, economic or general market environment of the issuer’s industry or geographic region.

The amortized cost and fair value by contractual maturity periods for debt securities were as follows at June 30, 2020:

(In millions)	Amortized Cost		Fair Value
Due in one year or less	$	1,049	$	1,059
Due after one year through five years	7,298		7,593
Due after five years through ten years	8,751		9,582
Due after ten years	4,053		4,969
Mortgage and other asset-backed securities	475		471
Total	$	21,626	$	23,674

Actual maturities of these securities could differ from their contractual maturities used in the table above because issuers may have the right to call or prepay obligations, with or without penalties.

Gross unrealized appreciation (depreciation) on debt securities by type of issuer is shown below.

(In millions)	Amortized Cost		Allowance for Credit Loss		Unrealized Appreciation		Unrealized Depreciation		Fair Value
June 30, 2020
Federal government and agency	$	415	$	—	$	222	$	—	$	637
State and local government	654		—		85		(2)		737
Foreign government	2,002		—		293		(9)		2,286
Corporate	18,080		(39)		1,663		(161)		19,543
Mortgage and other asset-backed	475		(9)		28		(23)		471
Total	$	21,626	$	(48)	$	2,291	$	(195)	$	23,674
Investments supporting liabilities of the Company’s run-off settlement annuity business (included in total above) (1)	$	2,209	$	(11)	$	803	$	(25)	$	2,976
December 31, 2019
Federal government and agency	$	498	$	—	$	235	$	—	$	733
State and local government	729		—		81		—		810
Foreign government	2,027		—		230		(1)		2,256
Corporate	18,149		—		1,299		(28)		19,420
Mortgage and other asset-backed	506		—		31		(1)		536
Total	$	21,909	$	—	$	1,876	$	(30)	$	23,755
Investments supporting liabilities of the Company’s run-off settlement annuity business (included in total above) (1)	$	2,229	$	—	$	740	$	(4)	$	2,965

(1)Net unrealized appreciation for these investments is excluded from accumulated other comprehensive income.

The table below summarizes debt securities with a decline in fair value from amortized cost by investment grade and the length of time these securities have been in an unrealized loss position. These debt securities are primarily corporate securities with a decline in fair value that reflects an increase in market yields since purchase. See discussion of Realized Investment Gains and Losses below for further information on the credit loss expense recorded for the Company's investments.

	June 30, 2020							December 31, 2019
(Dollars in millions)	Fair Value		Amortized Cost		Unrealized Depreciation		Number of Issues	Fair Value		Amortized Cost		Unrealized Depreciation		Number of Issues
One year or less
Investment grade	$	1,337	$	1,412	$	(75)	280	$	723	$	729	$	(6)	267
Below investment grade	$	968	$	1,055	$	(87)	831	$	340	$	348	$	(8)	355
More than one year
Investment grade	$	201	$	221	$	(20)	23	$	366	$	378	$	(12)	118
Below investment grade	$	75	$	88	$	(13)	35	$	84	$	88	$	(4)	93
Total	$	2,581	$	2,776	$	(195)	1,169	$	1,513	$	1,543	$	(30)	833

The table below presents a roll-forward of the allowance for credit losses on debt securities for the six months ended June 30, 2020.

(In millions)	2020
Beginning balance, January 1, 2020	$	0
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	55
Balance at March 31, 2020	55
Second Quarter Activity:
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	25
Reductions for securities sold during the period	(9)
Net reductions to allowance for credit losses on securities that had an allowance recorded in a previous period	(23)
Ending balance, June 30, 2020	$	48

Equity Securities

Equity securities with a readily determinable fair value consist primarily of mutual funds that invest in fixed income debt securities. Equity securities without a readily determinable fair value consist of private equity investments and are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes. The amount of impairments or value changes resulting from observable price changes was not material as of June 30, 2020 and December 31, 2019. Hybrid equity securities consist of preferred stock investments that have call features.

The following table provides the values of the Company's equity security investments as of June 30, 2020 and December 31, 2019.

	June 30, 2020				December 31, 2019
(Dollars in millions)	Amortized Cost		Carrying Value		Amortized Cost		Carrying Value
Equity securities with readily determinable fair values	$	140	$	134	$	61	$	64
Equity securities with no readily determinable fair value	$	187	$	196	$	183	$	192
Hybrid equity securities	$	58	$	43	$	58	$	47
Total	$	385	$	373	$	302	$	303

Commercial Mortgage Loans

Accounting policy. Commercial mortgage loans are carried at unpaid principal balances. Beginning January 1, 2020 with the adoption of ASU 2016-13, unpaid principal balances are presented net of an allowance for expected credit losses. Changes in the allowance for expected credit losses are recognized as credit loss expense and presented in Realized investment gains and losses in the Company’s income statement. Each period, the Company establishes (or adjusts) its allowance for expected credit losses for commercial mortgage loans. The allowance for expected credit losses is based on a credit risk category that is assigned to each loan at origination using key credit quality indicators, including debt service coverage and loan-to-value ratios. Credit risk categories are updated as key credit quality indicators change. An expected loss rate, assigned based on the credit risk category, is applied to each loan's unpaid principal balance to develop an aggregate allowance for expected credit losses. Prior to adoption, impaired commercial mortgage loans were written down to the lower of unpaid principal or fair value of the underlying collateral when it became probable that the Company would not collect all amounts due under its promissory note. The Company recorded an allowance of $7 million through a cumulative effect adjustment to retained earnings to reflect expected credit losses at adoption. The credit loss allowance for the Company’s commercial mortgage loan investments was $8 million as of June 30, 2020.

Commercial mortgage loans are considered impaired and written off against the allowance when it is probable that the Company will not collect all amounts due per the terms of the promissory note. The Company elected the expedient to not measure an allowance for credit losses for accrued interest receivables. Consistent with our prior practice, accrued interest, reported in other current assets, is written off through a charge to net investment income; interest income on impaired loans is only recognized when a payment is received.

In the event of a foreclosure, the allowance for credit losses is based on the excess of the carrying value of the mortgage loan over the fair value of its underlying collateral.

Mortgage loans held by the Company are made exclusively to commercial borrowers and are diversified by property type, location and borrower. Loans are generally issued at fixed rates of interest and are secured by high quality, primarily completed and substantially leased operating properties. Commercial mortgage loans are classified as either current or long-term investments based on their contractual maturities.

Credit quality. The Company regularly evaluates and monitors credit risk, beginning with the initial underwriting of a mortgage loan and continuing throughout the investment holding period. Mortgage origination professionals employ an internal credit quality rating system designed to evaluate the relative risk of the transaction at origination that is then updated each year as part of the annual portfolio loan review. The Company evaluates and monitors credit quality on a consistent and ongoing basis, classifying each loan as a loan in good standing, potential problem loan or problem loan.

Quality ratings are based on our evaluation of a number of key inputs related to the loan, including real estate market-related factors such as rental rates and vacancies, and property-specific inputs such as growth rate assumptions and lease rollover statistics. However, the two most significant contributors to the credit quality rating are the debt service coverage and loan-to-value ratios. The debt service coverage ratio measures the amount of property cash flow available to meet annual interest and principal payments on debt, with a ratio below 1.0 indicating that there is not enough cash flow to cover the required loan payments. The loan-to-value ratio, commonly expressed as a percentage, compares the amount of the loan to the fair value of the underlying property collateralizing the loan.

The following table summarizes the credit risk profile of the Company’s commercial mortgage loan portfolio based on loan-to-value and debt service coverage ratios as of June 30, 2020 and December 31, 2019:

(Dollars in millions)	June 30, 2020					December 31, 2019
Loan-to-Value Ratio	Carrying Value		Average Debt Service Coverage Ratio	Average Loan-to-Value Ratio		Carrying Value		Average Debt Service Coverage Ratio	Average Loan-to-Value Ratio
Below 60%	$	904	2.18			$	1,136	2.19
60% to 79%	903		1.94			723		1.98
80% to 100%	143		1.33			88		1.62
Allowance for credit losses	(8)
Total	$	1,942	2.01	60	%	$	1,947	2.09	58	%

The Company’s annual in-depth review of its commercial mortgage loan investments is the primary mechanism for identifying emerging risks in the portfolio. The Company’s investment professionals completed the annual in-depth review in the second quarter of 2020 that included an analysis of each underlying property’s most recent annual financial statements, rent rolls, operating plans, budgets, a physical inspection of the property and other pertinent factors. Based on historical results, current leases, lease expirations and rental conditions in each market, the Company estimated the current year and future stabilized property income and fair value for each loan. The average loan to value increased slightly from last year and remains strong. The portfolio's average debt service coverage ratio decreased slightly as June 30, 2020 compared with December 31, 2019 but remains at a high level.

The Company re-evaluates a loan’s credit quality between annual reviews if new property information is received or an event such as delinquency or a borrower’s request for restructure causes management to believe that the Company’s estimate of financial performance, fair value or the risk profile of the underlying property has been impacted.

All commercial mortgage loans in the Company's portfolio are current as of June 30, 2020 and December 31, 2019.

Other Long-Term Investments

Other long-term investments include investments in unconsolidated entities, including certain limited partnerships and limited liability companies holding real estate, securities or loans. These investments are carried at cost plus the Company's ownership percentage of reporting income or loss, based on the financial statements of the underlying investments that are generally reported at fair value. Income or loss from these investments is reported on a one quarter lag due to the timing of when financial information is received from the general partner or manager of the investments.

Other long-term investments also include investment real estate, foreign currency swaps, and statutory and other deposits. The following table provides carrying value information for these investments.

	Carrying value as of
(In millions)	June 30, 2020		December 31, 2019
Real estate investments	$	850	$	788
Securities partnerships	1,525		1,409
Other	525		206
Total	$	2,900	$	2,403

Short-Term Investments and Cash Equivalents

Short-term investments and cash equivalents included the following types of issuers:

(In millions)	June 30, 2020		December 31, 2019
Corporate securities	$	4,266	$	1,985
Federal government securities	$	482	$	472
Foreign government securities	$	32	$	65
Money market funds	$	814	$	631

B.Realized Investment Gains and Losses

Accounting policy. Realized investment gains and losses are based on specifically identified assets and results from sales, investment asset write-downs, change in the fair value of certain derivatives and equity securities, and changes in valuation reserves on commercial mortgage loans. Commencing January 1, 2020, realized gains and losses also

include credit loss expense resulting from the impact of changes in the allowances for credit losses on debt securities and commercial mortgage loan investments under ASU 2016-13.

The following realized gains and losses on investments exclude amounts required to adjust future policy benefits for the run-off settlement annuity business (consistent with accounting for a premium deficiency), as well as realized gains and losses attributed to the Company’s separate accounts because those gains and losses generally accrue directly to separate account policyholders.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Net realized investment gains, excluding credit loss expense and asset write-downs	$	33	$	25	$	9	$	36
Credit loss expense on invested assets	6		—		(49)		—
Other investment asset write-downs	(1)		(2)		(10)		(3)
Net realized investment gains (losses), before income taxes	$	38	$	23	$	(50)	$	33

Net realized investment gains, excluding credit loss expense and asset write-downs, for the six months ended June 30, 2020 primarily represent gains on the sales of debt securities, partially offset by mark-to-market losses on foreign exchange derivatives and equity securities. Net realized investment gains, excluding credit loss expense and asset write-downs, for the six months ended June 30, 2019 represent mark-to-market gains on equity securities and gains on the sales of debt securities and real estate partnerships. Credit loss expense on invested assets for the six months ended June 30, 2020 reflects credit losses incurred on debt securities due to uncertainty around issuers in certain industries that are particularly impacted by the global COVID-19 pandemic. Realized gains and losses on equity securities still held at June 30, 2020 and 2019 were not material.

The following table presents sales information for available-for-sale debt securities. Gross gains on sales and gross losses on sales exclude amounts required to adjust future policy benefits for the run-off settlement annuity business.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Proceeds from sales	$	880	$	565	$	1,623	$	1,651
Gross gains on sales	$	27	$	9	$	66	$	23
Gross losses on sales	$	(14)	$	(2)	$	(21)	$	(12)

C.Derivative Financial Instruments

The Company uses derivative financial instruments to manage the characteristics of investment assets (such as duration, yield, currency and liquidity) to meet the varying demands of the related insurance and contract holder liabilities. The Company also uses derivative financial instruments to hedge the risk of changes in the net assets of certain of its foreign subsidiaries due to changes in foreign currency exchange rates. The Company has written and purchased GMIB reinsurance contracts in its run-off reinsurance business that are accounted for as freestanding derivatives as discussed in Note 10. Derivatives in the Company’s separate accounts are excluded from the following discussion because associated gains and losses generally accrue directly to separate account policyholders.

Derivative instruments used by the Company typically include foreign currency swap contracts and foreign currency forward contracts. Foreign currency swap contracts periodically exchange cash flows between two currencies for principal and interest. Foreign currency forward contracts require the Company to purchase a foreign currency in

exchange for the functional currency of its operating unit at a future date, generally within three months from the contracts’ trade dates.

The Company manages the credit risk of these derivative instruments by diversifying its portfolio among approved dealers of high credit quality and through routine monitoring of credit risk exposures. Certain of the Company’s over-the-counter derivative instruments require either the Company or the counterparty to post collateral or demand immediate payment depending on the amount of the net liability position of the derivative instrument and predefined financial strength or credit rating thresholds. These collateral posting requirements vary by counterparty. The Company would incur a loss if dealers completely failed to perform under derivative contracts, however collateral has been posted by dealers to cover substantially all of the fair values owed by dealers at June 30, 2020 and December 31, 2019. The fair value of collateral posted by the Company was not significant as of June 30, 2020 or December 31, 2019.

The gross fair values of our derivative financial instruments are presented in Note 12. The following table summarizes the types and notional quantity of derivative instruments held by the Company. As of June 30, 2020 and December 31, 2019, the effects of these individual hedging strategies were not material to the Consolidated Financial Statements, including gains or losses reclassified from accumulated other comprehensive income into shareholders' net income, as well as amounts excluded from the assessment of hedge effectiveness.

	(In millions)	Notional Value as of
		June 30, 2020		December 31, 2019
Purpose	Type of Instrument
Fair value hedge: To hedge the foreign exchange-related changes in fair values of certain foreign-denominated bonds. The notional value of these derivatives matches the amortized cost of the hedged bonds.	Foreign currency swap contracts	$	817	$	817
Net investment hedge: To reduce the risk of changes in net assets due to changes in foreign currency spot exchange rates for certain foreign subsidiaries that conduct their business principally in Euros, Korean Won, and Taiwan Dollar. The notional value of hedging instruments matches the hedged amount of subsidiary net assets.	Foreign currency swap contracts	$	526	$	438
	Foreign currency forward contracts	$	606	$	406
Economic hedge: To hedge the foreign exchange-related changes in fair value of a U.S. dollar-denominated bond portfolio to reflect the local currency for the Company’s foreign subsidiary in South Korea. The notional value of hedging instruments generally aligns with the fair value of the hedged bond portfolio.	Foreign currency forward contracts	$	442	$	410

The Company’s derivative financial instruments are presented as follows: 

•Fair value hedges of the foreign exchange-related changes in fair values of certain foreign-denominated bonds: Swap fair values are reported in Long-term investments or Other non-current liabilities. Changes in fair values attributable to foreign exchange risk of the swap contracts and the hedged bonds are reported in Realized investment gains and losses. The portion of the swap contracts’ changes in fair value excluded from the assessment of hedge effectiveness is recorded in Other comprehensive income and recognized in Net investment income as swap coupon payments are accrued, offsetting the foreign-denominated coupons received on the designated bonds. Net cash flows are reported in Operating activities, while exchanges of notional principal amounts are reported in Investing activities.

•Net investment hedges of certain foreign subsidiaries that conduct their business principally in currencies other than the U.S. dollar: The fair values of the foreign currency swap and forward contracts are reported in Other assets or Other liabilities. The changes in fair values of these instruments are reported in Other comprehensive income, specifically in translation of foreign currencies. The portion of the change in fair values relating to foreign exchange spot rates will be recognized in earnings upon deconsolidation of the

hedged foreign subsidiaries. The remaining changes in fair value of these instruments are excluded from our effectiveness assessment and recognized in interest expense when coupon payments are accrued or ratably over the term of the instrument. The notional value of hedging instruments matches the hedged amount of subsidiary net assets. Cash flows relating to these contracts are reported in Investing activities.

•Economic hedges for derivatives not designated as accounting hedges: Fair values of forward contracts are reported in current Investments or Accrued expenses and other liabilities. The changes in fair values are reported in Realized investment gains and losses. Cash flows relating to these contracts are reported in Investing activities.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company carries certain financial instruments at fair value in the financial statements including debt securities, certain equity securities, short-term investments and derivatives. Other financial instruments are measured at fair value only under certain conditions, such as when impaired or when there are observable price changes for equity securities with no readily determinable fair value.

Fair value is defined as the price at which an asset could be exchanged in an orderly transaction between market participants at the balance sheet date. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a market participant, not the amount that would be paid to settle the liability with the creditor.

The Company’s financial assets and liabilities carried at fair value have been classified based upon a hierarchy defined by GAAP. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset’s or a liability’s classification is based on the lowest level of input that is significant to its measurement. For example, a financial asset or liability carried at fair value would be classified in Level 3 if unobservable inputs were significant to the instrument’s fair value, even though the measurement may be derived using inputs that are both observable (Levels 1 and 2) and unobservable (Level 3).

The Company estimates fair values using prices from third parties or internal pricing methods. Fair value estimates received from third-party pricing services are based on reported trade activity and quoted market prices when available, and other market information that a market participant would use to estimate fair value. The internal pricing methods are performed by the Company’s investment professionals and generally involve using discounted cash flow analyses, incorporating current market inputs for similar financial instruments with comparable terms and credit quality as well as other qualitative factors. In instances where there is little or no market activity for the same or similar instruments, fair value is estimated using methods, models and assumptions that the Company believes a hypothetical market participant would use to determine a current transaction price. These valuation techniques involve some level of estimation and judgment that becomes significant with increasingly complex instruments or pricing models.

The Company is responsible for determining fair value and for assigning the appropriate level within the fair value hierarchy based on the significance of unobservable inputs. The Company reviews methodologies, processes and controls of third-party pricing services and compares prices on a test basis to those obtained from other external pricing sources or internal estimates. The Company performs ongoing analyses of both prices received from third-party pricing services and those developed internally to determine that they represent appropriate estimates of fair value. The controls executed by the Company include evaluating changes in prices and monitoring for potentially stale valuations. The Company also performs sample testing of sales values to confirm the accuracy of prior fair value estimates. The minimal exceptions identified during these processes indicate that adjustments to prices are

infrequent and do not significantly impact valuations. We conduct an annual on-site visit of the most significant pricing service to review their processes, methodologies and controls. This on-site review includes a walk-through of inputs for a sample of securities held across various asset types to validate the documented pricing process.

A.Financial Assets and Financial Liabilities Carried at Fair Value

The following table provides information as of June 30, 2020 and December 31, 2019 about the Company’s financial assets and liabilities carried at fair value. Separate account assets are also recorded at fair value on the Company’s Consolidated Balance Sheets and are reported separately in the Separate Accounts section below as gains and losses related to these assets generally accrue directly to policyholders.

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
	As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019
Financial assets at fair value
Debt securities
Federal government and agency	$	192	$	197	$	445	$	536	$	—	$	—	$	637	$	733
State and local government	—		—		737		810		—		—		737		810
Foreign government	—		—		2,260		2,228		26		28		2,286		2,256
Corporate	—		—		18,889		19,063		654		357		19,543		19,420
Mortgage and other asset-backed	—		—		322		398		149		138		471		536
Total debt securities	192		197		22,653		23,035		829		523		23,674		23,755
Equity securities (1)	1		7		145		72		31		32		177		111
Short-term investments	—		—		456		423		—		—		456		423
Derivative assets	—		—		193		83		—		—		193		83
Real estate funds priced at NAV as a practical expedient (2)													168		184
Financial liabilities at fair value
Derivative liabilities	$	—	$	—	$	15	$	18	$	—	$	—	$	15	$	18

(1)Excludes certain equity securities that have no readily determinable fair value.

(2)As a practical expedient, certain real estate funds are carried at fair value based on the Company’s ownership share of the equity of the investee (Net Asset Value (“NAV“)) including changes in the fair value of its underlying investments. The Company has $55 million in unfunded commitments in these funds as of June 30, 2020.

Level 1 Financial Assets

Inputs for instruments classified in Level 1 include unadjusted quoted prices for identical assets in active markets accessible at the measurement date. Active markets provide pricing data for trades occurring at least weekly and include exchanges and dealer markets.

Assets in Level 1 include actively-traded U.S. government bonds and exchange-listed equity securities. A relatively small portion of the Company’s investment assets are classified in this category given the narrow definition of Level 1 and the Company’s investment asset strategy to maximize investment returns.

Level 2 Financial Assets and Financial Liabilities

Inputs for instruments classified in Level 2 include quoted prices for similar assets or liabilities in active markets, quoted prices from those willing to trade in markets that are not active or other inputs that are market observable or can be corroborated by market data for the term of the instrument. Such other inputs include market interest rates and volatilities, spreads and yield curves. An instrument is classified in Level 2 if the Company determines that unobservable inputs are insignificant.

Debt and equity securities. Approximately 95% of the Company’s investments in debt and equity securities are classified in Level 2 including most public and private corporate debt and hybrid equity securities, federal agency and municipal bonds, non-government mortgage-backed securities and preferred stocks. Third-party pricing services and internal methods often use recent trades of securities with similar features and characteristics because many debt securities do not trade daily. Pricing models are used to determine these prices when recent trades are not available. These models calculate fair values by discounting future cash flows at estimated market interest rates. Such market rates are derived by calculating the appropriate spreads over comparable U.S. Treasury securities based on the credit quality, industry and structure of the asset. Typical inputs and assumptions to pricing models include, but are not limited to, a combination of benchmark yields, reported trades, issuer spreads, liquidity, benchmark securities, bids, offers, reference data and industry and economic events. For mortgage-backed securities, inputs and assumptions may also include characteristics of the issuer, collateral attributes, prepayment speeds and credit rating.

Nearly all of these instruments are valued using recent trades or pricing models. Less than 1% of the fair value of investments classified in Level 2 represents foreign bonds that are valued using a single, unadjusted market-observable input derived by averaging multiple broker-dealer quotes, consistent with local market practice.

Short-term investments are carried at fair value that approximates cost. The Company compares market prices for these securities to recorded amounts on a regular basis to validate that current carrying amounts approximate exit prices. The short-term nature of the investments and corroboration of the reported amounts over the holding period support their classification in Level 2.

Derivative assets and liabilities classified in Level 2 represent over-the-counter instruments such as foreign currency forward and swap contracts. Fair values for these instruments are determined using market observable inputs including forward currency and interest rate curves and widely published market observable indices. Credit risk related to the counterparty and the Company is considered when estimating the fair values of these derivatives. However, the Company is largely protected by collateral arrangements with counterparties and determined that no adjustments for credit risk were required as of June 30, 2020 or December 31, 2019. The nature and use of these derivative financial instruments are described in Note 11.

Level 3 Financial Assets and Financial Liabilities

Certain inputs for instruments classified in Level 3 are unobservable (supported by little or no market activity) and significant to their resulting fair value measurement. Unobservable inputs reflect the Company’s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date.

The Company classifies certain newly-issued, privately-placed, complex or illiquid securities in Level 3. Approximately 4% of debt and equity securities are priced using significant unobservable inputs and classified in this category.

Fair values of mortgage and other asset-backed securities, as well as corporate and government debt securities, are primarily determined using pricing models that incorporate the specific characteristics of each asset and related assumptions including the investment type and structure, credit quality, industry and maturity date in comparison to current market indices, spreads and liquidity of assets with similar characteristics. Inputs and assumptions for pricing may also include characteristics of the issuer, collateral attributes and prepayment speeds for mortgage and other asset-backed securities. Recent trades in the subject security or similar securities are assessed when available, and the Company may also review published research in its evaluation, as well as the issuer’s financial statements.

Quantitative Information about Unobservable Inputs

The following table summarizes the fair value and significant unobservable inputs used in pricing the following debt securities that were developed directly by the Company as of June 30, 2020 and December 31, 2019. The range and weighted average basis point (“bps”) amounts for liquidity and credit spreads (adjustment to discount rates) reflect the Company’s best estimates of the unobservable adjustments a market participant would make to calculate these fair values. These inputs have increased over the reported periods, resulting from continued uncertainty over the economic impacts related to COVID-19.

Corporate and government debt securities. The significant unobservable input used to value the following corporate and government debt securities is an adjustment for liquidity. This adjustment is needed to reflect current market conditions and issuer circumstances when there is limited trading activity for the security.

Mortgage and other asset-backed securities. The significant unobservable inputs used to value the following mortgage and other asset-backed securities are liquidity and weighting of credit spreads. An adjustment for liquidity is made as of the measurement date that considers current market conditions, issuer circumstances and complexity of the security structure when there is limited trading activity for the security. An adjustment to weight credit spreads is needed to value a more complex bond structure with multiple underlying collateral and no standard market valuation technique. The weighting of credit spreads is primarily based on the underlying collateral’s characteristics and their proportional cash flows supporting the bond obligations.

	Fair Value as of					Unobservable Adjustment Range (Weighted Average by Quantity) as of
(Fair value in millions )	June 30, 2020		December 31, 2019		Unobservable input June 30, 2020	June 30, 2020	December 31, 2019
Debt securities
Corporate and government debt securities	$	678	$	385	Liquidity	70 - 1700 (390) bps	70 - 930 (280) bps
Mortgage and other asset-backed securities	149		138		Liquidity	60 - 370 (70) bps	60 - 370 (70) bps
					Weighting of credit spreads	310 - 620 (440) bps	240 - 460 (330) bps
Securities not priced by the Company (1)	2		—
Total Level 3 debt securities	$	829	$	523

(1)The fair values for these securities use single, unadjusted non-binding broker quotes not developed directly by the Company.

Significant increases in liquidity or credit spreads would result in lower fair value measurements while decreases in these inputs would result in higher fair value measurements. The unobservable inputs are generally not interrelated and a change in the assumption used for one unobservable input is not accompanied by a change in the other unobservable input.

Changes in Level 3 Financial Assets and Financial Liabilities Carried at Fair Value

The following tables summarize the changes in financial assets and financial liabilities classified in Level 3 for the three and six months ended June 30, 2020 and 2019. Gains and losses reported in these tables may include net changes in fair value that are attributable to both observable and unobservable inputs.

Debt and Equity Securities
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Balance at beginning of period	$	766	$	436	$	555	$	410
Total gains (losses) included in shareholders’ net income	17		—		5		(1)
Gains (losses) included in other comprehensive income	12		5		(59)		12
Gains (losses) required to adjust future policy benefits for settlement annuities (1)	7		—		(3)		2
Purchases, sales and settlements
Purchases	2		43		64		43
Sales	—		—		(12)		—
Settlements	(5)		(9)		(7)		(10)
Total purchases, sales and settlements	$	(3)	$	34	$	45	$	33
Transfers into/(out of) Level 3
Transfers into Level 3	179		13		527		33
Transfers out of Level 3	(118)		(57)		(210)		(58)
Total transfers into/(out of) Level 3	$	61	$	(44)	$	317	$	(25)
Balance at June 30,	$	860	$	431	$	860	$	431
Total gains (losses) included in shareholders’ net income attributable to instruments held at the reporting date	$	16	$	(1)	$	(1)	$	(1)
Change in unrealized gains or losses included in other comprehensive income for assets held at the end of the reporting period	$	12	N/A		$	(54)	N/A

(1)Amounts do not accrue to shareholders.

Total gains and losses included in Shareholders’ net income in the tables above are reflected in the Consolidated Statements of Income as Net realized investment gains (losses) and Net investment income.

Gains and losses included in Other comprehensive income in the tables above are reflected in Net unrealized appreciation (depreciation) on securities in the Consolidated Statements of Comprehensive Income.

Transfers into or out of the Level 3 category occur when unobservable inputs, such as the Company’s best estimate of what a market participant would use to determine a current transaction price, become more or less significant to the fair value measurement. Transfers between Level 2 and Level 3 during 2020 and 2019 primarily reflected changes in liquidity and credit risk estimates for certain private placement issuers across several sectors.

Separate Accounts

The investment income and fair value gains and losses of separate account assets generally accrue directly to the contractholders and, together with their deposits and withdrawals, are excluded from the Company’s Consolidated Statements of Income and Cash Flows.

Fair values of separate account assets at June 30, 2020 and December 31, 2019 were as follows:

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
	June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019
Guaranteed separate accounts (See Note 18)	$	203	$	219	$	298	$	271	$	—	$	—	$	501	$	490
Non-guaranteed separate accounts (1)	1,485		1,450		5,228		5,522		334		263		7,047		7,235
Subtotal	$	1,688	$	1,669	$	5,526	$	5,793	$	334	$	263	$	7,548	$	7,725
Non-guaranteed separate accounts priced at NAV as a practical expedient (1)													727		756
Total													$	8,275	$	8,481
Separate account assets of business classified as held for sale													(14)		(16)
Separate account assets per Consolidated Balance Sheets													$	8,261	$	8,465

(1)Non-guaranteed separate accounts included $3.9 billion as of June 30, 2020 and $4.0 billion as of December 31, 2019 in assets supporting the Company’s pension plans, including $0.3 billion classified in Level 3 as of June 30, 2020 and $0.2 billion classified in Level 3 as of December 31, 2019.

Separate account assets classified as Level 1 primarily include exchange-listed equity securities. Level 2 assets primarily include:

•corporate and structured bonds valued using recent trades of similar securities or pricing models that discount future cash flows at estimated market interest rates as described above; and

•actively-traded institutional and retail mutual fund investments.

Separate account assets classified in Level 3 primarily support Cigna’s pension plans and include certain newly-issued, privately-placed, complex, or illiquid securities that are priced using methods discussed above, as well as commercial mortgage loans. Activity, including transfers into and out of Level 3, was not material for the three and six months ended June 30, 2020 and 2019.

Separate account investments in securities partnerships, real estate, and hedge funds are generally valued based on the separate account’s ownership share of the equity of the investee (NAV as a practical expedient) including changes in the fair values of its underlying investments. Substantially all of these assets support the Cigna Pension Plans. The following table provides additional information on these investments.

	Fair Value as of				Unfunded Commitment as of June 30, 2020		Redemption Frequency (if currently eligible)	Redemption Notice Period
(In millions)	June 30, 2020		December 31, 2019
Securities partnerships	$	499	$	531	$	314	Not applicable	Not applicable
Real estate funds	224		220		—		Quarterly	30 - 90 days
Hedge funds	4		5		—		Up to annually, varying by fund	30 - 90 days
Total	$	727	$	756	$	314

As of June 30, 2020, the Company does not have plans to sell any of these assets at less than fair value. These investments are structured to satisfy longer-term investment objectives. Securities partnerships are contractually

unredeemable, and the underlying investment assets are expected to be liquidated by the fund managers within ten years after inception.

B.Assets and Liabilities Measured at Fair Value under Certain Conditions

Some financial assets and liabilities are not carried at fair value each reporting period, but may be measured using fair value only under certain conditions such as when investments become impaired, including investment real estate and commercial mortgage loans and certain equity securities with no readily determinable fair value. Equity securities with no readily determinable fair value are also measured at fair value when there are observable price changes from orderly transactions with the same issuer. For the six months ended June 30, 2020, there were immaterial losses relating to price changes for equity securities with no readily determinable fair value and no impaired investments written down to their fair values. For the six months ended June 30, 2019, there were immaterial gains relating to price changes for equity securities with no readily determinable fair value and no impaired investments written down to their fair values . Carrying values represented less than 1% of total investments as of both June 30, 2020 and June 30, 2019.

C.Fair Value Disclosures for Financial Instruments Not Carried at Fair Value

The following table includes the Company’s financial instruments not recorded at fair value that are subject to fair value disclosure requirements at June 30, 2020 and December 31, 2019. In addition to universal life products and finance leases, financial instruments that are carried in the Company’s Consolidated Financial Statements at amounts that approximate fair value are excluded from the following table.

		June 30, 2020				December 31, 2019
(In millions)	Classification in Fair Value Hierarchy	Fair Value		Carrying Value		Fair Value		Carrying Value
Commercial mortgage loans	Level 3	$	1,990	$	1,942	$	1,989	$	1,947
Long-term debt, including current maturities, excluding finance leases	Level 2	$	40,310	$	35,054	$	39,439	$	36,375

Fair values of off-balance sheet financial instruments were not material as of June 30, 2020 and December 31, 2019.

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Variable Interest Entities

6 Months Ended

Jun. 30, 2020

Variable Interest Entities [Abstract]

Variable Interest Entities

Variable Interest Entities

When the Company becomes involved with a variable interest entity and when there is a change in the Company’s involvement with an entity, the Company must determine if it is the primary beneficiary and must consolidate the entity. The Company is considered the primary beneficiary if it has the power to direct the entity’s most significant economic activities and has the right to receive benefits or obligation to absorb losses that could be significant to the entity. The Company evaluates the following criteria:

•the structure and purpose of the entity;

•the risks and rewards created by, and shared through, the entity; and

•the Company’s ability to direct its activities, receive its benefits and absorb its losses relative to the other parties involved with the entity including its sponsors, equity holders, guarantors, creditors and servicers.

The Company determined it was not a primary beneficiary in any material variable interest entities as of June 30, 2020 or December 31, 2019. The Company’s involvement in variable interest entities for which it is not the primary beneficiary is described below.

Securities limited partnerships and real estate limited partnerships. The Company owns interests in securities limited partnerships and real estate limited partnerships that are defined as variable interest entities. These partnerships invest in the equity or mezzanine debt of privately-held companies and real estate properties. General partners unaffiliated with the Company control decisions that most significantly impact the partnership’s operations and the limited partners do not have substantive kick-out or participating rights. The Company’s maximum exposure to loss from these entities of $3.8 billion across approximately 150 limited partnerships as of June 30, 2020, included $1.9 billion reported in Long-term investments and commitments to contribute an additional $1.9 billion. The Company’s noncontrolling interest in each of these limited partnerships is generally less than 15% of the partnership ownership interests.

Other asset-backed and corporate securities. In the normal course of its investing activities, the Company also makes passive investments in certain asset-backed and corporate securities that are issued by variable interest entities whose sponsors or issuers are unaffiliated with the Company. The Company receives fixed-rate cash flows from these investments and the maximum potential exposure to loss is limited to our carrying amount of $0.7 billion as of June 30, 2020 that is reported in debt securities. The Company’s combined ownership interests are insignificant relative to the total principal amounts issued by these entities.

The Company is involved with various other variable interest entities with immaterial carrying values and maximum exposures to loss.

The Company has not provided, and does not intend to provide, financial support to any of the variable interest entities beyond what it is contractually required to provide. The Company performs ongoing qualitative analyses of its involvement with these variable interest entities to determine if consolidation is required.

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2020

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss) (“AOCI”)

AOCI includes unrealized appreciation on securities and derivatives (excluding appreciation on investments supporting future policy benefit liabilities of the run-off settlement annuity business) (See Note 11), foreign currency translation and the net postretirement benefits liability adjustment. AOCI includes the Company’s share from unconsolidated entities reported on the equity method. Generally, tax effects in AOCI are established at the currently enacted tax rate and reclassified to net income in the same period that the related pre-tax AOCI reclassifications are recognized. Changes in the components of AOCI were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Securities and Derivatives
Beginning balance	$	547	$	460	$	975	$	18
Appreciation on securities and derivatives	920		442		340		1,007
Tax (expense)	(197)		(94)		(69)		(216)
Net appreciation on securities and derivatives	723		348		271		791
Reclassification adjustment for losses (gains) included in shareholders' net income (net realized investment losses (gains))	(19)		(6)		13		(7)
Tax (expense) benefit	5		1		(3)		1
Net losses (gains) reclassified from AOCI to net income	(14)		(5)		10		(6)
Other comprehensive income, net of tax	709		343		281		785
Ending balance	$	1,256	$	803	$	1,256	$	803
Translation of foreign currencies
Beginning balance	$	(446)	$	(245)	$	(275)	$	(221)
Translation of foreign currencies	65		(42)		(95)		(67)
Tax (expense) benefit	5		—		(10)		(1)
Net translation of foreign currencies	70		(42)		(105)		(68)
Less: Net translation of foreign currencies attributable to noncontrolling interests	(2)		(2)		(6)		(4)
Shareholders' net translation of foreign currencies	72		(40)		(99)		(64)
Ending balance	$	(374)	$	(285)	$	(374)	$	(285)
Postretirement benefits liability
Beginning balance	$	(1,628)	$	(1,497)	$	(1,641)	$	(1,508)
Reclassification adjustment for amortization of net losses from past experience and prior service costs (interest expense and other)	18		16		36		31
Reclassification adjustment for settlement (interest expense and other)	—		—		—		10
Tax (expense) benefit	(4)		5		(9)		(9)
Net adjustments reclassified from AOCI to net income	14		21		27		32
Valuation update	(73)		(8)		(73)		(8)
Tax benefit	17		1		17		1
Net change due to valuation update	(56)		(7)		(56)		(7)
Other comprehensive (loss) income, net of tax	(42)		14		(29)		25
Ending balance	$	(1,670)	$	(1,483)	$	(1,670)	$	(1,483)

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Organizational Efficiency Plan	6 Months Ended
	Jun. 30, 2020
Restructuring and Related Activities [Abstract]
Organizational Efficiency Plan	Organizational Efficiency Plan The Company is continuously evaluating ways to deliver our products and services more efficiently and at a lower cost. During the fourth quarter of 2019, we committed to a plan to increase our organizational alignment and operational efficiency and reduce costs. As a result, we recognized a charge in Selling, general and administrative expenses of $207 million pre-tax ($162 million after-tax) in the fourth quarter of 2019 and an additional $31 million pre-tax ($24 million after-tax) in the first quarter 2020, primarily for severance costs related to headcount reductions. As of June 30, 2020 we expect most of the severance to be paid by the end of 2021.

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Leases

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Leases

Leases

Operating and finance lease right of use ("ROU") assets and lease liabilities were as follows:

(In millions)	June 30, 2020		December 31, 2019
Operating leases:
Operating lease ROU assets	$	544	$	536
Accrued expenses and other current liabilities	$	158	$	166
Other non-current liabilities	482		465
Total operating lease liabilities	$	640	$	631
Finance leases:
Property and equipment, gross	$	98	$	110
Accumulated depreciation	(35)		(23)
Property and equipment, net	$	63	$	87
Short-term debt	$	22	$	27
Long-term debt	43		61
Total finance lease liabilities	$	65	$	88

Leases

Leases

Operating and finance lease right of use ("ROU") assets and lease liabilities were as follows:

(In millions)	June 30, 2020		December 31, 2019
Operating leases:
Operating lease ROU assets	$	544	$	536
Accrued expenses and other current liabilities	$	158	$	166
Other non-current liabilities	482		465
Total operating lease liabilities	$	640	$	631
Finance leases:
Property and equipment, gross	$	98	$	110
Accumulated depreciation	(35)		(23)
Property and equipment, net	$	63	$	87
Short-term debt	$	22	$	27
Long-term debt	43		61
Total finance lease liabilities	$	65	$	88

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Income Taxes

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Income Tax Expense

The 20.0% effective tax rate for the six months ended June 30, 2020 was lower than the 21.5% rate for the same period in 2019. This decrease is primarily attributable to incremental tax benefits including the remeasurement of deferred state income taxes and the settlement of uncertain tax positions. This decrease was partially offset by return of the nondeductible health insurer tax.

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Contingencies and Other Matters

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Contingencies and Other Matters

Contingencies and Other Matters

The Company, through its subsidiaries, is contingently liable for various guarantees provided in the ordinary course of business.

A.Financial Guarantees: Retiree and Life Insurance Benefits

The Company guarantees that separate account assets will be sufficient to pay certain life insurance or retiree benefits. For the majority of these benefits, the sponsoring employers are primarily responsible for ensuring that assets are sufficient to pay these benefits and are required to maintain assets that exceed a certain percentage of benefit obligations. If employers fail to do so, the Company or an affiliate of the buyer of the retirement benefits business has the right to redirect the management of the related assets to provide for benefit payments. As of June 30, 2020, employers maintained assets that exceeded the benefit obligations under these arrangements of approximately $455 million. An additional liability is established if management believes that the Company will be required to make payments under the guarantees; there were no additional liabilities required for these guarantees, net of reinsurance, as of June 30, 2020. Separate account assets supporting these guarantees are classified in Levels 1 and 2 of the GAAP fair value hierarchy.

The Company does not expect that these financial guarantees will have a material effect on the Company’s consolidated results of operations, liquidity or financial condition.

B.Certain Other Guarantees

The Company had indemnification obligations as of June 30, 2020 in connection with acquisition and disposition transactions. These indemnification obligations are triggered by the breach of representations or covenants provided by the Company, such as representations for the presentation of financial statements, filing of tax returns, compliance with law or identification of outstanding litigation. These obligations are typically subject to various time limitations, defined by the contract or by operation of law, such as statutes of limitation. In some cases, the maximum potential amount due is subject to contractual limitations based on a percentage of the transaction purchase price, while in other cases limitations are not specified or applicable. The Company does not believe that it is possible to determine the maximum potential amount due under these obligations because not all amounts due under these indemnification obligations are subject to limitation. There were no liabilities for these indemnification obligations as of June 30, 2020.

C.Guaranty Fund Assessments

The Company operates in a regulatory environment that may require its participation in assessments under state insurance guaranty association laws. The Company’s exposure to assessments for certain obligations of insolvent insurance companies to policyholders and claimants is based on its share of business written in the relevant jurisdictions.

There were no material effects for existing or new guaranty fund assessments for the six months ended June 30, 2020.

D.Legal and Regulatory Matters

The Company is routinely involved in numerous claims, lawsuits, regulatory inquiries and audits, government investigations, including under the federal False Claims Act and state false claims acts initiated by a government investigating body or by a qui tam relator’s filing of a complaint under court seal, and other legal matters arising, for the most part, in the ordinary course of managing a global health service business. Additionally, the Company has received and is cooperating with subpoenas or similar processes from various governmental agencies requesting information, all arising in the normal course of its business. Disputed tax matters arising from audits by the Internal Revenue Service or other state and foreign jurisdictions, including those resulting in litigation, are accounted for under GAAP guidance for uncertain tax positions. Further information on income tax matters can be found in Note 17.

Pending litigation and legal or regulatory matters that the Company has identified with a reasonably possible material loss and certain other material litigation matters are described below. For those matters that the Company has identified with a reasonably possible material loss, the Company provides disclosure in the aggregate of accruals and range of loss, or a statement that such information cannot be estimated. The Company’s accruals for the matters discussed below under “Litigation Matters” and "Regulatory Matters" are immaterial. Due to numerous uncertain factors presented in these cases, it is not possible to estimate an aggregate range of loss (if any) for these matters at this time. In light of the uncertainties involved in these matters, there is no assurance that their ultimate resolution will not exceed the amounts currently accrued by the Company. An adverse outcome in one or more of these matters could be material to the Company’s results of operations, financial condition or liquidity for any particular period. The outcomes of lawsuits are inherently unpredictable and we may be unsuccessful in these ongoing litigation matters or any future claims or litigation.

Litigation Matters

Risk Corridors and CSR Litigation with the Federal Government. As a result of the Supreme Court decision in April 2020, the Company filed suit in early May against the United States in the U.S. Court of Federal Claims seeking to recover two types of payments the Federal Government owes Cigna under the risk corridors and cost-sharing reduction (“CSR”) programs of the ACA. In aggregate, the complaint seeks to recover more than $315 million: $120 million in risk corridors payments and more than $195 million in CSR payments. Cigna’s complaint is pending and we await the Federal Government’s response.

Cigna Litigation with Anthem. In February 2017, the Company delivered a notice to Anthem terminating the 2015 merger agreement and notifying Anthem that it must pay the Company the $1.85 billion reverse termination fee pursuant to the terms of the merger agreement. Also in February 2017, the Company filed suit against Anthem in the Delaware Court of Chancery (the “Chancery Court”) seeking declaratory judgments that the Company’s termination of the merger agreement was valid and that Anthem was not permitted to extend the termination date. The complaint also sought payment of the reverse termination fee and additional damages in an amount exceeding $13 billion, including the lost premium value to the Company’s shareholders caused by Anthem’s willful breaches of the merger agreement. Anthem has countersued, alleging its own claims for damages.

On February 15, 2017, the Chancery Court granted Anthem’s motion for a temporary restraining order and temporarily enjoined the Company from terminating the merger agreement. In May 2017, the Chancery Court denied Anthem’s motion for a preliminary injunction to enjoin Cigna from terminating the merger agreement but stayed its ruling pending Anthem’s determination as to whether to seek an appeal. Anthem subsequently notified Cigna and the Chancery Court that it did not intend to appeal the Chancery Court’s decision. As a result, the merger agreement was terminated.

The litigation between the parties remains pending. A trial was held during the first quarter of 2019. Oral arguments on post-trial briefs were held on November 26, 2019. In February 2020, the Chancery Court requested additional post-trial briefing, which has been completed. In June 2020, the Company was notified by the Chancery Court that its decision had been delayed, due in part to COVID-19 complexities. We believe in the merits of our claims and dispute Anthem’s claims, and we intend to vigorously defend ourselves and pursue our claims.

Express Scripts Litigation with Anthem. In March 2016, Anthem filed a lawsuit in the United States District Court for the Southern District of New York alleging various breach of contract claims against Express Scripts relating to the parties’ rights and obligations under the periodic pricing review section of the pharmacy benefit management agreement between the parties including allegations that Express Scripts failed to negotiate new pricing concessions in good faith, as well as various alleged service issues. Anthem also requested that the court enter declaratory judgment that Express Scripts is required to provide Anthem competitive benchmark pricing, that Anthem can terminate the agreement, and that Express Scripts is required to provide Anthem with post-termination services at competitive benchmark pricing for one year following any termination by Anthem. Anthem claims it is entitled to $13 billion in additional pricing concessions over the remaining term of the agreement, as well as $1.8 billion for one year following any contract termination by Anthem and $150 million damages for service issues (“Anthem’s Allegations”). On April 19, 2016, in response to Anthem’s complaint, Express Scripts filed its answer denying Anthem’s Allegations in their entirety and asserting affirmative defenses and counterclaims against Anthem. The court subsequently granted Anthem’s motion to dismiss two of six counts of Express Scripts’ amended counterclaims. The current scheduling order runs through the completion of summary judgment briefing in March 2021. There is no tentative trial date. We believe in the merits of our claims and dispute Anthem’s claims, and we intend to vigorously defend ourselves and pursue our claims.

Regulatory Matters

Civil Investigative Demand. The U.S. Department of Justice (“DOJ”) is conducting an industry-wide investigation of Medicare Advantage organizations’ risk adjustment practices under Medicare Parts C and D including medical chart reviews and health exams. For certain other Medicare Advantage organizations, the investigation has resulted in litigation. The Company is currently responding to information requests (civil investigative demands) received from the DOJ (U.S. Attorney’s Offices for the Eastern District of Pennsylvania and the Southern District of New York). We will continue to cooperate with the DOJ’s investigation.

Disability claims regulatory matter. The Company is subject to an agreement with the Departments of Insurance for Maine, Massachusetts, Pennsylvania, Connecticut and California (together, the “Lead States”), originally entered into in 2013, that relates to the Company’s long-term disability claims handling practices. The agreement provides for enhanced procedures related to documentation and disposition. Cigna has cooperated fully with the Lead States and we believe we have addressed the requirements of the agreement. The Lead States initiated a re-examination of our practices. In April 2020, the re-examination was closed with a determination that the Company is in material compliance and no adverse regulatory action was, or is expected to be, taken.

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Segment Information

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Segment Information

Segment Information

See Note 1 for a description of our segments. A description of our basis for reporting segment operating results is outlined below. Intersegment revenues primarily reflect pharmacy related transactions between the Health Services and Integrated Medical segments.

The Company uses “pre-tax adjusted income from operations” and “adjusted revenues” as its principal financial measures of segment operating performance because management believes they best reflect the underlying results of business operations and permit analysis of trends in underlying revenue, expenses and profitability. Pre-tax adjusted income from operations is defined as income before taxes excluding realized investment results, amortization of acquired intangible assets, special items and, for periods prior to 2020, earnings contribution from transitioning clients Anthem Inc. and Coventry Health Care, Inc. (the “transitioning clients”). As of December 31, 2019, the transition of these clients was substantially complete; therefore, beginning in 2020, we no longer exclude results of transitioning clients from our adjusted revenues and adjusted income from operations. Income or expense amounts that are excluded from adjusted income from operations because they are not indicative of underlying performance or the responsibility of operating segment management include:

•Realized investment gains (losses) including changes in market values of certain financial instruments between balance sheet dates, as well as gains and losses associated with invested asset sales.

•Amortization of acquired intangible assets because these relate to costs incurred for acquisitions.

•Results of transitioning clients, for periods prior to 2020, because those results were not indicative of ongoing results.

•Special items, if any, that management believes are not representative of the underlying results of operations due to the nature or size of these matters.

The Company does not report total assets by segment because this is not a metric used to allocate resources or evaluate segment performance.

Adjusted revenues is defined as revenues excluding: 1) revenue contribution from transitioning clients for periods prior to 2020; 2) the Company’s share of certain realized investment results of its joint ventures reported in the International Markets segment using the equity method of accounting; and 3) special items, if any.

The following tables present the special items recorded by the Company for the three and six months ended June 30, 2020 and 2019.

	Three Months Ended
(In millions)	June 30, 2020				June 30, 2019
Description of special item charges (benefits) and financial statement line item(s)	After-tax		Before-tax		After-tax		Before-tax
Debt extinguishment costs (Debt extinguishment costs)	$	11	$	14	$	—	$	—
Integration and transaction-related costs (Selling, general and administrative expenses)	99		130		115		155
Charges associated with litigation matters (Selling, general and administrative expenses)	—		—		64		81
Total impact from special items	$	110	$	144	$	179	$	236

	Six Months Ended
(In millions)	June 30, 2020				June 30, 2019
Description of Special Item Charges (Benefits) and Financial Statement Line Item(s)	After-tax		Before-tax		After-tax		Before-tax
Debt extinguishment costs (Debt extinguishment costs)	$	151	$	199	$	—	$	—
Integration and transaction-related costs (Selling, general and administrative expenses)	173		227		223		291
Charge for organizational efficiency plan (Selling, general and administrative expenses)	24		31		—		—
Charges associated with litigation matters (Selling, general and administrative expenses)	19		25		64		81
Contractual adjustment for a former client (Pharmacy revenues)	(66)		(87)		—		—
Total impact from special items	$	301	$	395	$	287	$	372

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The Consolidated Financial Statements include the accounts of Cigna Corporation and its consolidated subsidiaries. Intercompany transactions and accounts have been eliminated in consolidation. These Consolidated Financial Statements were prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

Amounts recorded in the Consolidated Financial Statements necessarily reflect management’s estimates and assumptions about medical costs, investment and receivable valuations, interest rates and other factors. Significant estimates are discussed throughout these Notes; however, actual results could differ from those estimates. The impact of a change in estimate is generally included in earnings in the period of adjustment.

These interim Consolidated Financial Statements are unaudited but include all adjustments (including normal recurring adjustments) necessary, in the opinion of management, for a fair statement of financial position and results of operations for the periods reported. The interim Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes included in the 2019 Annual Report on Form 10-K (“2019 Form 10-K”). The preparation of interim Consolidated Financial Statements necessarily relies heavily on estimates. This and other factors, including the seasonal nature of portions of the health care and related benefits business, competitive and other market conditions, as well as COVID-19 related impacts, call for caution in estimating full-year results based on interim results of operations.

Recent Accounting Pronouncements, Recently Adopted Accounting Guidance and Accounting Guidance Not Yet Adopted

Recent Accounting Pronouncements

The Company's 2019 Form 10-K includes discussion of significant recent accounting pronouncements that either have impacted our financial statements or may impact them in the future. The following information provides updates on recently adopted or recently issued accounting pronouncements that have occurred since the Company filed its 2019 Form 10-K.

Recently Adopted Accounting Guidance

Accounting Standard and Adoption Date	Requirements and Effects of Adopting New Guidance
Measurement of Credit Losses on Financial Instruments (Accounting Standards Update (ASU) 2016-13 and related amendments) Adopted as of January 1, 2020	Requires:
	•	A new approach using expected credit losses to estimate and recognize credit losses for certain financial instruments (such as mortgage loans, reinsurance recoverables and other receivables) when such instruments are first originated or acquired, and in each subsequent reporting period, compared with the incurred loss model previously followed under GAAP. At adoption, the Company recorded an allowance for estimated credit losses and subsequent changes in the allowance will be reported in current period earnings.
	•	Changes in the criteria for impairment of available-for-sale debt securities
	Effects of adoption:
	•	Adopted using a modified retrospective approach
	•	Cumulative effect adjustment of $30 million after-tax was recorded as a reduction to retained earnings as of January 1, 2020, reflecting an additional allowance for future expected credit losses required under the new model, primarily related to reinsurance recoverables.
	•	See additional information regarding the Company’s accounting policy for establishing the allowance for credit losses in Note 4, Accounts Receivable, Net, Note 10, Reinsurance, and Note 11, Investments.
Simplifying the Test for Goodwill Impairment (ASU 2017-04) Adopted as of January 1, 2020	Requires:
	•	A simplified approach to the accounting for goodwill impairment by eliminating the need to determine the fair value of individual assets and liabilities of a reporting unit to measure a goodwill impairment
	•	The amount of goodwill impairment to equal the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the total amount of goodwill of the reporting unit
	Effects of adoption:
	•	Adopted on a prospective basis
	•	There was no impact of adopting this new standard to the Company’s financial statements because our quarterly qualitative assessments did not result in a triggering event for impairment of goodwill.

Accounting Guidance Not Yet Adopted

Accounting Standard and Effective Date	Requirements and Expected Effects of New Guidance Not Yet Adopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASU 2020-04) Optional, effective upon issuance (March 12, 2020) through December 31, 2022	Guidance:
	•	Provides temporary optional relief to ease the potential burden of accounting for reference rate reform under existing GAAP. Amendments are elective and apply to all entities that have contracts, hedging relationships and other transactions that reference interbank offered rates, including LIBOR, expected to be discontinued by December 31, 2021.
	•	Permits optional expedients and exceptions to simplify the accounting for contract modifications, hedging arrangements and held-to-maturity investments, when certain changes are made to a contract or instrument to facilitate reference rate reform.
	•	An entity may elect to apply the amendments, by topic or subsection, at any point prospectively through December 31, 2022. When elected, the optional expedients must be applied consistently for all eligible contracts or transactions.
	Expected effects:
	•	To date, the Company has identified minimal exposure to LIBOR and does not anticipate that LIBOR’s phase-out will have a material impact on its operations or financial results.

The Financial Accounting Standards Board voted to propose the deferral of the effective date of ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts and, in July 2020, issued a proposed standard for comment extending the effective date by one year, or until January 1, 2023 for the Company.

Allowance for Credit Losses

The Company's accounts receivable balances primarily include amounts due from clients, third-party payors, customers and pharmaceutical manufacturers, and are presented net of allowances. The Company's adoption of ASU 2016-13, Measurement of Credit Losses on Financial Instruments (ASU 2016-13), as of January 1, 2020 did not have a material impact on our accounts receivable credit loss allowance, as there were no substantive changes to our methodology for this class of assets. The allowance for expected credit losses for current accounts receivable is based primarily on past collections experience relative to the length of time receivables are past due; however, when available evidence reasonably supports an assumption that counterparty credit risk over the expected payment period will differ from current and historical payment collections, a forecasting adjustment is reflected in the allowance for expected credit losses.All other (non-credit) allowances are based on the current status of each customer's receivable balance as well as current economic and market conditions and a variety of other factors, including the length of time the receivables are past due, the financial health of customers and our past experience. We bill pharmaceutical manufacturers based on management's interpretation of contractual terms and estimate a contractual allowance based on the best information available at the time a claim is processed. Contractual allowances for certain rebates receivable from pharmaceutical manufacturers are determined by reviewing payment experience and specific known items that could be adjusted under contract terms. The Company's estimation process for contractual allowances for pharmaceutical manufacturer receivables generally results in an allowance for balances outstanding greater than 90 days.

Contractual allowances for certain receivables from third-party payors are based on their contractual terms and are estimates based on the Company's best information available at the time revenue is recognized.

Receivables and any associated allowance are written off only when all collection attempts have failed and such amounts are determined unrecoverable. We regularly review the adequacy of these allowances based on a variety of factors, including age of the outstanding receivable and collection history. When circumstances related to specific collection patterns change, estimates of the recoverability of receivables are adjusted.

Unpaid Claims and Claims Expenses

Unpaid Claims and Claim Expenses – Integrated MedicalThis liability reflects estimates of the ultimate cost of claims that have been incurred but not reported, including expected development on reported claims, those that have been reported but not yet paid (reported claims in process), and other medical care expenses and services payable that are primarily comprised of accruals for incentives and other amounts payable to health care professionals and facilities.

Reinsurance

Reinsurance and other amounts recoverable reflect amounts due from reinsurers and policyholders to cover incurred but not reported and pending claims of certain business for which the Company administers the plan benefits without any right of offset.Accounting policy. Reinsurance recoverables represent amounts due from reinsurers for both paid and unpaid claims of the Company’s insurance businesses. Most reinsurance recoverables are classified as non-current assets. The current portion of reinsurance recoverables is reported in Other current assets and consists primarily of recoverables on paid claims expected to be settled within one year. Reinsurance recoverables are presented net of allowances for uncollectible reinsurance that, effective with adopting ASU 2016-13 on January 1, 2020, consists primarily of an allowance for expected credit losses. Estimates of the allowance for expected credit losses are based on internal and external data used to develop expected loss rates over the anticipated duration of the recoverable asset that vary by external credit rating and collateral level. Collateral levels are defined internally based on the fair value of the collateral relative to the carrying amount of the reinsurance recoverable, the frequency at which collateral is required to be replenished and the potential for volatility in the collateral’s fair value. The Company bears the risk of loss if its reinsurers and retrocessionaires do not meet or are unable to meet their reinsurance obligations to the Company. The Company reviews its reinsurance arrangements and establishes reserves against the recoverables, as further described above.GMDB is accounted for as assumed and ceded reinsurance and GMIB assets and liabilities are reported as derivatives at fair value as discussed below. GMIB assets are reported in Other current assets and Other assets, and GMIB liabilities are reported in Accrued expenses and other liabilities and Other non-current liabilities.

GMIB

The Company reinsured contracts with issuers of GMIB products. The Company’s exposure represents the excess of a contractually guaranteed amount over the level of variable annuity account values. Payment by the Company depends on the actual account value in the related underlying mutual funds and the level of interest rates when the contractholders elect to receive minimum income payments that can only occur within 30 days of a policy

anniversary after the appropriate waiting period. The Company has purchased retrocessional coverage (“GMIB assets”) for these contracts including retrocessional coverage from Berkshire.

Assumptions used in fair value measurement. GMIB assets and liabilities are established using capital market assumptions and assumptions related to future annuitant behavior (including mortality, lapse, and annuity election rates). The Company classifies GMIB assets and liabilities in Level 3 of the fair value hierarchy described in Note 12 because assumptions related to future annuitant behavior are largely unobservable.

The only assumption expected to impact future shareholders’ net income is non-performance risk. The non-performance risk adjustment reflects a market participant’s view of nonpayment risk by adding an additional spread to the discount rate in the calculation of both (a) the GMIB liabilities to be paid by the Company, and (b) the GMIB assets to be paid by the reinsurers, after considering collateral

Contractholder Deposit Funds

The majority of the liability for unpaid claims and claim expenses is related to disability claims with long-tailed payouts that relate to a business held for sale. Interest earned on assets backing these liabilities is an integral part of pricing and reserving. Therefore, interest accreted on prior year balances is shown as a separate component of prior year incurred claims and reported in Medical costs and other benefit expenses in the income statement. This interest is calculated by applying the average discount rate used in determining the liability balance to the average liability balance over the period. The remaining prior year incurred claims amount primarily reflects updates to the Company’s liability estimates and variances between actual experience during the period relative to the assumptions and expectations reflected in determining the liability. Assumptions reflect the Company’s expectations over the life of the book of business and will vary from actual experience in any period, both favorably and unfavorably, with variation in resolution rates being the most significant driver for the long-term disability business.

Investments

Debt Securities

Accounting policy. Debt securities (including bonds, mortgage and other asset-backed securities and preferred stocks redeemable by the investor) are classified as available for sale and are carried at fair value with changes in fair value recorded either in Accumulated other comprehensive income (loss) within Shareholders’ equity or in credit loss expense based on fluctuations in the allowance for credit losses, as further discussed below. Net unrealized appreciation on debt securities supporting the Company’s run-off settlement annuity business is reported in Non-current insurance and contractholder liabilities rather than Accumulated other comprehensive income (loss). When the Company intends to sell or determines that it is more likely than not to be required to sell an impaired debt security, the excess of amortized cost over fair value is directly written down with a charge to Realized investment gains and losses.

As of January 1, 2020, the Company adopted ASU 2016-13 that included certain targeted improvements to the accounting for available-for-sale debt securities. The new guidance resulted in certain policy changes related to the process used by the Company to review declines in fair value from a security’s amortized cost basis to determine whether a credit loss exists. For example, the length of time that a debt security has been impaired is no longer a criterion for this review. In addition, under this new guidance, the Company recognizes an allowance for credit loss with a corresponding charge to credit loss expense, presented in Realized investment gains and losses in the Company’s income statement. Prior to this new guidance, the Company recorded a direct write-down of the instrument’s amortized cost basis. The allowance for credit loss represents the excess of amortized cost over the greater of its fair value or the net present value of the debt security's projected future cash flows (based on

qualitative and quantitative factors, including the probability of default, and the estimated timing and amount of recovery). Each period, the allowance for credit loss is adjusted through credit loss expense.

The Company elected the expedient to not measure an allowance for credit losses for accrued interest receivables. Consistent with prior practice, when interest payments are delinquent based on contractual terms or when certain terms (interest rate or maturity date) of the investment have been restructured, accrued interest, reported in Other current assets, is written off through a charge to Net investment income, and interest income is recognized on a cash basis.

Debt securities are classified as either Current or Long-term investments based on their contractual maturities.

Review of declines in fair value. Management reviews impaired debt securities to determine whether a credit loss allowance is needed based on criteria that include:

•severity of decline;

•financial health and specific prospects of the issuer; and

•changes in the regulatory, economic or general market environment of the issuer’s industry or geographic region.

Equity Securities Equity securities with a readily determinable fair value consist primarily of mutual funds that invest in fixed income debt securities. Equity securities without a readily determinable fair value consist of private equity investments and are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes.

Commercial Mortgage Loans

Accounting policy. Commercial mortgage loans are carried at unpaid principal balances. Beginning January 1, 2020 with the adoption of ASU 2016-13, unpaid principal balances are presented net of an allowance for expected credit losses. Changes in the allowance for expected credit losses are recognized as credit loss expense and presented in Realized investment gains and losses in the Company’s income statement. Each period, the Company establishes (or adjusts) its allowance for expected credit losses for commercial mortgage loans. The allowance for expected credit losses is based on a credit risk category that is assigned to each loan at origination using key credit quality indicators, including debt service coverage and loan-to-value ratios. Credit risk categories are updated as key credit quality indicators change. An expected loss rate, assigned based on the credit risk category, is applied to each loan's unpaid principal balance to develop an aggregate allowance for expected credit losses. Prior to adoption, impaired commercial mortgage loans were written down to the lower of unpaid principal or fair value of the underlying collateral when it became probable that the Company would not collect all amounts due under its promissory note. The Company recorded an allowance of $7 million through a cumulative effect adjustment to retained earnings to reflect expected credit losses at adoption. The credit loss allowance for the Company’s commercial mortgage loan investments was $8 million as of June 30, 2020.

Commercial mortgage loans are considered impaired and written off against the allowance when it is probable that the Company will not collect all amounts due per the terms of the promissory note. The Company elected the expedient to not measure an allowance for credit losses for accrued interest receivables. Consistent with our prior practice, accrued interest, reported in other current assets, is written off through a charge to net investment income; interest income on impaired loans is only recognized when a payment is received.

In the event of a foreclosure, the allowance for credit losses is based on the excess of the carrying value of the mortgage loan over the fair value of its underlying collateral.

Mortgage loans held by the Company are made exclusively to commercial borrowers and are diversified by property type, location and borrower. Loans are generally issued at fixed rates of interest and are secured by high quality, primarily completed and substantially leased operating properties. Commercial mortgage loans are classified as either current or long-term investments based on their contractual maturities.

Credit quality. The Company regularly evaluates and monitors credit risk, beginning with the initial underwriting of a mortgage loan and continuing throughout the investment holding period. Mortgage origination professionals employ an internal credit quality rating system designed to evaluate the relative risk of the transaction at origination that is then updated each year as part of the annual portfolio loan review. The Company evaluates and monitors credit quality on a consistent and ongoing basis, classifying each loan as a loan in good standing, potential problem loan or problem loan.

Quality ratings are based on our evaluation of a number of key inputs related to the loan, including real estate market-related factors such as rental rates and vacancies, and property-specific inputs such as growth rate assumptions and lease rollover statistics. However, the two most significant contributors to the credit quality rating are the debt service coverage and loan-to-value ratios. The debt service coverage ratio measures the amount of property cash flow available to meet annual interest and principal payments on debt, with a ratio below 1.0 indicating that there is not enough cash flow to cover the required loan payments. The loan-to-value ratio, commonly expressed as a percentage, compares the amount of the loan to the fair value of the underlying property collateralizing the loan.

The Company’s annual in-depth review of its commercial mortgage loan investments is the primary mechanism for identifying emerging risks in the portfolio. The Company’s investment professionals completed the annual in-depth review in the second quarter of 2020 that included an analysis of each underlying property’s most recent annual financial statements, rent rolls, operating plans, budgets, a physical inspection of the property and other pertinent factors. Based on historical results, current leases, lease expirations and rental conditions in each market, the Company estimated the current year and future stabilized property income and fair value for each loan. The average loan to value increased slightly from last year and remains strong. The portfolio's average debt service coverage ratio decreased slightly as June 30, 2020 compared with December 31, 2019 but remains at a high level.The Company re-evaluates a loan’s credit quality between annual reviews if new property information is received or an event such as delinquency or a borrower’s request for restructure causes management to believe that the Company’s estimate of financial performance, fair value or the risk profile of the underlying property has been impacted.

Other Long-Term Investments

Other long-term investments include investments in unconsolidated entities, including certain limited partnerships and limited liability companies holding real estate, securities or loans. These investments are carried at cost plus the Company's ownership percentage of reporting income or loss, based on the financial statements of the underlying investments that are generally reported at fair value. Income or loss from these investments is reported on a one quarter lag due to the timing of when financial information is received from the general partner or manager of the investments.

Realized Investment Gains and LossesAccounting policy. Realized investment gains and losses are based on specifically identified assets and results from sales, investment asset write-downs, change in the fair value of certain derivatives and equity securities, and changes in valuation reserves on commercial mortgage loans. Commencing January 1, 2020, realized gains and losses also include credit loss expense resulting from the impact of changes in the allowances for credit losses on debt securities and commercial mortgage loan investments under ASU 2016-13.Derivative Financial Instruments

The Company uses derivative financial instruments to manage the characteristics of investment assets (such as duration, yield, currency and liquidity) to meet the varying demands of the related insurance and contract holder liabilities. The Company also uses derivative financial instruments to hedge the risk of changes in the net assets of certain of its foreign subsidiaries due to changes in foreign currency exchange rates. The Company has written and purchased GMIB reinsurance contracts in its run-off reinsurance business that are accounted for as freestanding derivatives as discussed in Note 10. Derivatives in the Company’s separate accounts are excluded from the following discussion because associated gains and losses generally accrue directly to separate account policyholders.

Derivative instruments used by the Company typically include foreign currency swap contracts and foreign currency forward contracts. Foreign currency swap contracts periodically exchange cash flows between two currencies for principal and interest. Foreign currency forward contracts require the Company to purchase a foreign currency in

exchange for the functional currency of its operating unit at a future date, generally within three months from the contracts’ trade dates.The Company manages the credit risk of these derivative instruments by diversifying its portfolio among approved dealers of high credit quality and through routine monitoring of credit risk exposures. Certain of the Company’s over-the-counter derivative instruments require either the Company or the counterparty to post collateral or demand immediate payment depending on the amount of the net liability position of the derivative instrument and predefined financial strength or credit rating thresholds.

The Company’s derivative financial instruments are presented as follows: 

•Fair value hedges of the foreign exchange-related changes in fair values of certain foreign-denominated bonds: Swap fair values are reported in Long-term investments or Other non-current liabilities. Changes in fair values attributable to foreign exchange risk of the swap contracts and the hedged bonds are reported in Realized investment gains and losses. The portion of the swap contracts’ changes in fair value excluded from the assessment of hedge effectiveness is recorded in Other comprehensive income and recognized in Net investment income as swap coupon payments are accrued, offsetting the foreign-denominated coupons received on the designated bonds. Net cash flows are reported in Operating activities, while exchanges of notional principal amounts are reported in Investing activities.

•Net investment hedges of certain foreign subsidiaries that conduct their business principally in currencies other than the U.S. dollar: The fair values of the foreign currency swap and forward contracts are reported in Other assets or Other liabilities. The changes in fair values of these instruments are reported in Other comprehensive income, specifically in translation of foreign currencies. The portion of the change in fair values relating to foreign exchange spot rates will be recognized in earnings upon deconsolidation of the

hedged foreign subsidiaries. The remaining changes in fair value of these instruments are excluded from our effectiveness assessment and recognized in interest expense when coupon payments are accrued or ratably over the term of the instrument. The notional value of hedging instruments matches the hedged amount of subsidiary net assets. Cash flows relating to these contracts are reported in Investing activities.

•Economic hedges for derivatives not designated as accounting hedges: Fair values of forward contracts are reported in current Investments or Accrued expenses and other liabilities. The changes in fair values are reported in Realized investment gains and losses. Cash flows relating to these contracts are reported in Investing activities.

Fair Value Measurements

The Company carries certain financial instruments at fair value in the financial statements including debt securities, certain equity securities, short-term investments and derivatives. Other financial instruments are measured at fair value only under certain conditions, such as when impaired or when there are observable price changes for equity securities with no readily determinable fair value.

Fair value is defined as the price at which an asset could be exchanged in an orderly transaction between market participants at the balance sheet date. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a market participant, not the amount that would be paid to settle the liability with the creditor.

The Company’s financial assets and liabilities carried at fair value have been classified based upon a hierarchy defined by GAAP. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An asset’s or a liability’s classification is based on the lowest level of input that is significant to its measurement. For example, a financial asset or liability carried at fair value would be classified in Level 3 if unobservable inputs were significant to the instrument’s fair value, even though the measurement may be derived using inputs that are both observable (Levels 1 and 2) and unobservable (Level 3).

The Company estimates fair values using prices from third parties or internal pricing methods. Fair value estimates received from third-party pricing services are based on reported trade activity and quoted market prices when available, and other market information that a market participant would use to estimate fair value. The internal pricing methods are performed by the Company’s investment professionals and generally involve using discounted cash flow analyses, incorporating current market inputs for similar financial instruments with comparable terms and credit quality as well as other qualitative factors. In instances where there is little or no market activity for the same or similar instruments, fair value is estimated using methods, models and assumptions that the Company believes a hypothetical market participant would use to determine a current transaction price. These valuation techniques involve some level of estimation and judgment that becomes significant with increasingly complex instruments or pricing models.

The Company is responsible for determining fair value and for assigning the appropriate level within the fair value hierarchy based on the significance of unobservable inputs. The Company reviews methodologies, processes and controls of third-party pricing services and compares prices on a test basis to those obtained from other external pricing sources or internal estimates. The Company performs ongoing analyses of both prices received from third-party pricing services and those developed internally to determine that they represent appropriate estimates of fair value. The controls executed by the Company include evaluating changes in prices and monitoring for potentially stale valuations. The Company also performs sample testing of sales values to confirm the accuracy of prior fair value estimates. The minimal exceptions identified during these processes indicate that adjustments to prices are

infrequent and do not significantly impact valuations. We conduct an annual on-site visit of the most significant pricing service to review their processes, methodologies and controls. This on-site review includes a walk-through of inputs for a sample of securities held across various asset types to validate the documented pricing process.

Level 1 Financial Assets

Inputs for instruments classified in Level 1 include unadjusted quoted prices for identical assets in active markets accessible at the measurement date. Active markets provide pricing data for trades occurring at least weekly and include exchanges and dealer markets.

Assets in Level 1 include actively-traded U.S. government bonds and exchange-listed equity securities. A relatively small portion of the Company’s investment assets are classified in this category given the narrow definition of Level 1 and the Company’s investment asset strategy to maximize investment returns.

Level 2 Financial Assets and Financial Liabilities

Inputs for instruments classified in Level 2 include quoted prices for similar assets or liabilities in active markets, quoted prices from those willing to trade in markets that are not active or other inputs that are market observable or can be corroborated by market data for the term of the instrument. Such other inputs include market interest rates and volatilities, spreads and yield curves. An instrument is classified in Level 2 if the Company determines that unobservable inputs are insignificant.

Debt and equity securities. Approximately 95% of the Company’s investments in debt and equity securities are classified in Level 2 including most public and private corporate debt and hybrid equity securities, federal agency and municipal bonds, non-government mortgage-backed securities and preferred stocks. Third-party pricing services and internal methods often use recent trades of securities with similar features and characteristics because many debt securities do not trade daily. Pricing models are used to determine these prices when recent trades are not available. These models calculate fair values by discounting future cash flows at estimated market interest rates. Such market rates are derived by calculating the appropriate spreads over comparable U.S. Treasury securities based on the credit quality, industry and structure of the asset. Typical inputs and assumptions to pricing models include, but are not limited to, a combination of benchmark yields, reported trades, issuer spreads, liquidity, benchmark securities, bids, offers, reference data and industry and economic events. For mortgage-backed securities, inputs and assumptions may also include characteristics of the issuer, collateral attributes, prepayment speeds and credit rating.

Nearly all of these instruments are valued using recent trades or pricing models. Less than 1% of the fair value of investments classified in Level 2 represents foreign bonds that are valued using a single, unadjusted market-observable input derived by averaging multiple broker-dealer quotes, consistent with local market practice.

Short-term investments are carried at fair value that approximates cost. The Company compares market prices for these securities to recorded amounts on a regular basis to validate that current carrying amounts approximate exit prices. The short-term nature of the investments and corroboration of the reported amounts over the holding period support their classification in Level 2.

Derivative assets and liabilities classified in Level 2 represent over-the-counter instruments such as foreign currency forward and swap contracts. Fair values for these instruments are determined using market observable inputs including forward currency and interest rate curves and widely published market observable indices. Credit risk related to the counterparty and the Company is considered when estimating the fair values of these derivatives. However, the Company is largely protected by collateral arrangements with counterparties and determined that no adjustments for credit risk were required as of June 30, 2020 or December 31, 2019. The nature and use of these derivative financial instruments are described in Note 11.

Level 3 Financial Assets and Financial Liabilities

Certain inputs for instruments classified in Level 3 are unobservable (supported by little or no market activity) and significant to their resulting fair value measurement. Unobservable inputs reflect the Company’s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date.

The Company classifies certain newly-issued, privately-placed, complex or illiquid securities in Level 3. Approximately 4% of debt and equity securities are priced using significant unobservable inputs and classified in this category.

Fair values of mortgage and other asset-backed securities, as well as corporate and government debt securities, are primarily determined using pricing models that incorporate the specific characteristics of each asset and related assumptions including the investment type and structure, credit quality, industry and maturity date in comparison to current market indices, spreads and liquidity of assets with similar characteristics. Inputs and assumptions for pricing may also include characteristics of the issuer, collateral attributes and prepayment speeds for mortgage and other asset-backed securities. Recent trades in the subject security or similar securities are assessed when available, and the Company may also review published research in its evaluation, as well as the issuer’s financial statements.

Corporate and government debt securities. The significant unobservable input used to value the following corporate and government debt securities is an adjustment for liquidity. This adjustment is needed to reflect current market conditions and issuer circumstances when there is limited trading activity for the security.

Mortgage and other asset-backed securities. The significant unobservable inputs used to value the following mortgage and other asset-backed securities are liquidity and weighting of credit spreads. An adjustment for liquidity is made as of the measurement date that considers current market conditions, issuer circumstances and complexity of the security structure when there is limited trading activity for the security. An adjustment to weight credit spreads is needed to value a more complex bond structure with multiple underlying collateral and no standard market valuation technique. The weighting of credit spreads is primarily based on the underlying collateral’s characteristics and their proportional cash flows supporting the bond obligations.

Significant increases in liquidity or credit spreads would result in lower fair value measurements while decreases in these inputs would result in higher fair value measurements. The unobservable inputs are generally not interrelated and a change in the assumption used for one unobservable input is not accompanied by a change in the other unobservable input.

Total gains and losses included in Shareholders’ net income in the tables above are reflected in the Consolidated Statements of Income as Net realized investment gains (losses) and Net investment income.

Gains and losses included in Other comprehensive income in the tables above are reflected in Net unrealized appreciation (depreciation) on securities in the Consolidated Statements of Comprehensive Income.

Transfers into or out of the Level 3 category occur when unobservable inputs, such as the Company’s best estimate of what a market participant would use to determine a current transaction price, become more or less significant to the fair value measurement.

Separate account assets classified as Level 1 primarily include exchange-listed equity securities. Level 2 assets primarily include:

•corporate and structured bonds valued using recent trades of similar securities or pricing models that discount future cash flows at estimated market interest rates as described above; and

•actively-traded institutional and retail mutual fund investments.

Separate account assets classified in Level 3 primarily support Cigna’s pension plans and include certain newly-issued, privately-placed, complex, or illiquid securities that are priced using methods discussed above, as well as commercial mortgage loans. Activity, including transfers into and out of Level 3, was not material for the three and six months ended June 30, 2020 and 2019.

Separate account investments in securities partnerships, real estate, and hedge funds are generally valued based on the separate account’s ownership share of the equity of the investee (NAV as a practical expedient) including changes in the fair values of its underlying investments. Substantially all of these assets support the Cigna Pension Plans.Some financial assets and liabilities are not carried at fair value each reporting period, but may be measured using fair value only under certain conditions such as when investments become impaired, including investment real estate and commercial mortgage loans and certain equity securities with no readily determinable fair value. Equity securities with no readily determinable fair value are also measured at fair value when there are observable price changes from orderly transactions with the same issuer.

Separate Accounts

The investment income and fair value gains and losses of separate account assets generally accrue directly to the contractholders and, together with their deposits and withdrawals, are excluded from the Company’s Consolidated Statements of Income and Cash Flows.

Variable Interest Entities

When the Company becomes involved with a variable interest entity and when there is a change in the Company’s involvement with an entity, the Company must determine if it is the primary beneficiary and must consolidate the entity. The Company is considered the primary beneficiary if it has the power to direct the entity’s most significant economic activities and has the right to receive benefits or obligation to absorb losses that could be significant to the entity. The Company evaluates the following criteria:

•the structure and purpose of the entity;

•the risks and rewards created by, and shared through, the entity; and

•the Company’s ability to direct its activities, receive its benefits and absorb its losses relative to the other parties involved with the entity including its sponsors, equity holders, guarantors, creditors and servicers.

AOCI

AOCI includes unrealized appreciation on securities and derivatives (excluding appreciation on investments supporting future policy benefit liabilities of the run-off settlement annuity business) (See Note 11), foreign currency translation and the net postretirement benefits liability adjustment. AOCI includes the Company’s share from unconsolidated entities reported on the equity method. Generally, tax effects in AOCI are established at the currently enacted tax rate and reclassified to net income in the same period that the related pre-tax AOCI reclassifications are recognized.

Commitment and Contingencies

For those matters that the Company has identified with a reasonably possible material loss, the Company provides disclosure in the aggregate of accruals and range of loss, or a statement that such information cannot be estimated.

Segment Information

A description of our basis for reporting segment operating results is outlined below. Intersegment revenues primarily reflect pharmacy related transactions between the Health Services and Integrated Medical segments.

The Company uses “pre-tax adjusted income from operations” and “adjusted revenues” as its principal financial measures of segment operating performance because management believes they best reflect the underlying results of business operations and permit analysis of trends in underlying revenue, expenses and profitability. Pre-tax adjusted income from operations is defined as income before taxes excluding realized investment results, amortization of acquired intangible assets, special items and, for periods prior to 2020, earnings contribution from transitioning clients Anthem Inc. and Coventry Health Care, Inc. (the “transitioning clients”). As of December 31, 2019, the transition of these clients was substantially complete; therefore, beginning in 2020, we no longer exclude results of transitioning clients from our adjusted revenues and adjusted income from operations. Income or expense amounts that are excluded from adjusted income from operations because they are not indicative of underlying performance or the responsibility of operating segment management include:

•Realized investment gains (losses) including changes in market values of certain financial instruments between balance sheet dates, as well as gains and losses associated with invested asset sales.

•Amortization of acquired intangible assets because these relate to costs incurred for acquisitions.

•Results of transitioning clients, for periods prior to 2020, because those results were not indicative of ongoing results.

•Special items, if any, that management believes are not representative of the underlying results of operations due to the nature or size of these matters.

The Company does not report total assets by segment because this is not a metric used to allocate resources or evaluate segment performance.

Adjusted revenues is defined as revenues excluding: 1) revenue contribution from transitioning clients for periods prior to 2020; 2) the Company’s share of certain realized investment results of its joint ventures reported in the International Markets segment using the equity method of accounting; and 3) special items, if any.

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Requirements and Expected Effects of New Guidance Not Yet Adopted

Recently Adopted Accounting Guidance

Accounting Standard and Adoption Date	Requirements and Effects of Adopting New Guidance
Measurement of Credit Losses on Financial Instruments (Accounting Standards Update (ASU) 2016-13 and related amendments) Adopted as of January 1, 2020	Requires:
	•	A new approach using expected credit losses to estimate and recognize credit losses for certain financial instruments (such as mortgage loans, reinsurance recoverables and other receivables) when such instruments are first originated or acquired, and in each subsequent reporting period, compared with the incurred loss model previously followed under GAAP. At adoption, the Company recorded an allowance for estimated credit losses and subsequent changes in the allowance will be reported in current period earnings.
	•	Changes in the criteria for impairment of available-for-sale debt securities
	Effects of adoption:
	•	Adopted using a modified retrospective approach
	•	Cumulative effect adjustment of $30 million after-tax was recorded as a reduction to retained earnings as of January 1, 2020, reflecting an additional allowance for future expected credit losses required under the new model, primarily related to reinsurance recoverables.
	•	See additional information regarding the Company’s accounting policy for establishing the allowance for credit losses in Note 4, Accounts Receivable, Net, Note 10, Reinsurance, and Note 11, Investments.
Simplifying the Test for Goodwill Impairment (ASU 2017-04) Adopted as of January 1, 2020	Requires:
	•	A simplified approach to the accounting for goodwill impairment by eliminating the need to determine the fair value of individual assets and liabilities of a reporting unit to measure a goodwill impairment
	•	The amount of goodwill impairment to equal the amount by which a reporting unit’s carrying value exceeds its fair value, limited to the total amount of goodwill of the reporting unit
	Effects of adoption:
	•	Adopted on a prospective basis
	•	There was no impact of adopting this new standard to the Company’s financial statements because our quarterly qualitative assessments did not result in a triggering event for impairment of goodwill.

Accounting Guidance Not Yet Adopted

Accounting Standard and Effective Date	Requirements and Expected Effects of New Guidance Not Yet Adopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASU 2020-04) Optional, effective upon issuance (March 12, 2020) through December 31, 2022	Guidance:
	•	Provides temporary optional relief to ease the potential burden of accounting for reference rate reform under existing GAAP. Amendments are elective and apply to all entities that have contracts, hedging relationships and other transactions that reference interbank offered rates, including LIBOR, expected to be discontinued by December 31, 2021.
	•	Permits optional expedients and exceptions to simplify the accounting for contract modifications, hedging arrangements and held-to-maturity investments, when certain changes are made to a contract or instrument to facilitate reference rate reform.
	•	An entity may elect to apply the amendments, by topic or subsection, at any point prospectively through December 31, 2022. When elected, the optional expedients must be applied consistently for all eligible contracts or transactions.
	Expected effects:
	•	To date, the Company has identified minimal exposure to LIBOR and does not anticipate that LIBOR’s phase-out will have a material impact on its operations or financial results.

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Accounts Receivable, Net (Tables)

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

Accounts Receivable, Net

The following amounts were included within accounts receivable, net:

(In millions)	June 30, 2020		December 31, 2019
Noninsurance customer receivables	$	5,678	$	5,143
Pharmaceutical manufacturers receivable	4,654		3,439
Insurance customer receivables	2,607		2,321
Other receivables	386		334
Total	13,325		11,237
Accounts receivable, net classified as assets of business held for sale	(631)		(521)
Accounts receivable, net per Consolidated Balance Sheets	$	12,694	$	10,716

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Assets and Liabilities of Business Held for Sale (Tables)

6 Months Ended

Jun. 30, 2020

Discontinued Operations and Disposal Groups [Abstract]

Assets and Liabilities Held for Sale

The assets and liabilities of business held for sale were as follows:

(In millions)	June 30, 2020		December 31, 2019
Cash and cash equivalents	$	418	$	743
Accounts receivable, net	631		521
Investments	8,181		7,709
Other assets	558		539
Total assets of business held for sale	9,788		9,512
Insurance and contractholder liabilities	6,549		6,308
Other liabilities	560		504
Total liabilities of business held for sale	$	7,109	$	6,812

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

Basic and diluted earnings per share were computed as follows:

	Three Months Ended
	June 30, 2020						June 30, 2019
(Shares in thousands, dollars in millions, except per share amounts)	Basic		Effect of Dilution		Diluted		Basic		Effect of Dilution		Diluted
Shareholders’ net income	$	1,754			$	1,754	$	1,408			$	1,408
Shares:
Weighted average	367,396				367,396		377,962				377,962
Common stock equivalents			3,301		3,301				3,007		3,007
Total shares	367,396		3,301		370,697		377,962		3,007		380,969
EPS	$	4.77	$	(0.04)	$	4.73	$	3.73	$	(0.03)	$	3.70

	Six Months Ended
	June 30, 2020						June 30, 2019
(Shares in thousands, dollars in millions, except per share amounts)	Basic		Effect of Dilution		Diluted		Basic		Effect of Dilution		Diluted
Shareholders’ net income	$	2,935			$	2,935	$	2,776			$	2,776
Shares:
Weighted average	368,918				368,918		378,672				378,672
Common stock equivalents			3,750		3,750				3,824		3,824
Total shares	368,918		3,750		372,668		378,672		3,824		382,496
EPS	$	7.96	$	(0.08)	$	7.88	$	7.33	$	(0.07)	$	7.26

Outstanding Employee Stock Options Not Included in the Computation of Diluted Earnings Per Share

The following outstanding employee stock options were not included in the computation of diluted earnings per share because their effect was anti-dilutive.

	Three Months Ended June 30,		Six Months Ended June 30,
(In millions)	2020	2019	2020	2019
Anti-dilutive options	4.0	5.4	4.0	4.1

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Debt (Tables)

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Outstanding Amounts of Debt and Finance Leases

The outstanding amounts of debt and finance leases were as follows:

(In millions)	June 30, 2020		December 31, 2019
Short-term debt
$1,000 million, Floating Rate Notes due 3/2020	$	—	$	999
$300 million, 5.125% Notes due 6/2020	—		300
$1,750 million, 3.2% Notes due 9/2020	1,750		1,748
$349 million, 4.125% Notes due 9/2020	349		351
$500 million, 2.6% Notes due 11/2020	498		496
$400 million, Floating Rate Notes due 11/2020	400		400
$250 million, 4.375% Notes due 12/2020	250		249
$1,400 million, Floating Rate Term Loan due 3/2021	1,398		—
$78 million, 6.37% Notes due 6/2021	78		—
Commercial paper	5		944
Other, including finance leases	22		27
Total short-term debt	$	4,750	$	5,514
Long-term debt
$500 million, 3.3% Notes due 2021	$	—	$	499
$300 million, 4.5% Notes due 2021	—		298
$78 million, 6.37% Notes due 2021	—		78
$1,000 million, Floating Rate Notes due 2021	998		998
$1,250 million, 3.4% Notes due 2021	1,248		1,247
$1,248 million, 4.75% Notes due 2021	—		1,272
$277 million, 4% Notes due 2022	276		747
$973 million, 3.9% Notes due 2022	972		999
$500 million, 3.05% Notes due 2022	488		485
$17 million, 8.3% Notes due 2023	17		17
$63 million, 7.65% Notes due 2023	63		100
$700 million, Floating Rate Notes due 2023	698		698
$1,000 million, 3% Notes due 2023	971		966
$2,187 million, 3.75% Notes due 2023	2,180		3,088
$1,000 million, 3.5% Notes due 2024	974		970
$900 million, 3.25% Notes due 2025	895		895
$2,200 million, 4.125% Notes due 2025	2,189		2,188
$1,500 million, 4.5% Notes due 2026	1,505		1,506
$1,500 million, 3.4% Notes due 2027	1,404		1,396
$259 million, 7.875% Debentures due 2027	259		259
$600 million, 3.05% Notes due 2027	595		595
$3,800 million, 4.375% Notes due 2028	3,778		3,776
$1,500 million, 2.4% Notes due 2030	1,489		—
$45 million, 8.3% Step Down Notes due 2033	45		45
$190 million, 6.15% Notes due 2036	190		190
$2,200 million, 4.8% Notes due 2038	2,179		2,178
$750 million, 3.2% Notes due 2040	742		—
$121 million, 5.875% Notes due 2041	119		119
$448 million, 6.125% Notes due 2041	490		491
$317 million, 5.375% Notes due 2042	315		315
$1,500 million, 4.8% Notes due 2046	1,464		1,465
$1,000 million, 3.875% Notes due 2047	988		988
$3,000 million, 4.9% Notes due 2048	2,965		2,964
$1,250 million, 3.4% Notes due 2050	1,235		—
Other, including finance leases	43		61
Total long-term debt	$	31,774	$	31,893

Summary of Debt Issuances

Principal	Maturity Date	Interest Rate	Net Proceeds
$1,500 million	March 15, 2030	2.40%	$1,491 million
$750 million	March 15, 2040	3.20%	$743 million
$1,250 million	March 15, 2050	3.40%	$1,237 million

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Insurance and Contractholder Liabilities (Tables)

6 Months Ended

Jun. 30, 2020

Insurance Loss Reserves [Abstract]

Summary of Insurance and Contractholder Liabilities, Activity in the Unpaid Claims Liability and Liability Details for Unpaid Claims and Claim Expenses

As of June 30, 2020, December 31, 2019 and June 30, 2019, the Company’s insurance and contractholder liabilities were comprised of the following:

	June 30, 2020						December 31, 2019						June 30, 2019
(In millions)	Current		Non-current		Total		Current		Non-current		Total		Total
Contractholder deposit funds	$	627	$	7,062	$	7,689	$	600	$	7,139	$	7,739	$	7,883
Future policy benefits	528		9,417		9,945		553		9,281		9,834		9,715
Unpaid claims and claim expenses
Integrated Medical	2,942		17		2,959		2,875		17		2,892		2,881
Other segments	2,551		3,599		6,150		2,529		3,474		6,003		5,793
Unearned premiums	561		369		930		453		360		813		776
Total	7,209		20,464		27,673		7,010		20,271		27,281		27,048
Insurance and contractholder liabilities classified as liabilities of business held for sale(1)	(2,149)		(4,400)		(6,549)		(2,089)		(4,219)		(6,308)
Total insurance and contractholder liabilities	$	5,060	$	16,064	$	21,124	$	4,921	$	16,052	$	20,973	$	27,048

⁽¹⁾ Amounts classified as Liabilities of business held for sale primarily include $5.1 billion of unpaid claims, $758 million of contractholder deposit funds and $644 million of future policy benefits as of June 30, 2020 and $4.9 billion of unpaid claims, $717 million of contractholder deposit funds and $653 million of future policy benefits as of December 31, 2019.

Activity, net of intercompany transactions, in the unpaid claims liability for the Integrated Medical segment for the six months ended June 30 was as follows:

	Six Months Ended
(In millions)	June 30, 2020		June 30, 2019
Beginning balance	$	2,892	$	2,697
Less: Reinsurance and other amounts recoverable	303		264
Beginning balance, net	2,589		2,433
Incurred costs related to:
Current year	12,212		12,120
Prior years	(130)		(149)
Total incurred	12,082		11,971
Paid costs related to:
Current year	9,585		9,629
Prior years	2,284		2,134
Total paid	11,869		11,763
Ending balance, net	2,802		2,641
Add: Reinsurance and other amounts recoverable	157		240
Ending balance	$	2,959	$	2,881

The liability details for unpaid claims and claim expenses are as follows:

(In millions)	June 30, 2020 (1)		June 30, 2019
Group Disability and Other
Group Disability and Life	$	5,165	$	4,827
Other Operations	160		195
Total Group Disability and Other	5,325		5,022
International Markets	825		771
Unpaid claims and claim expenses Group Disability and Other and International Markets	$	6,150	$	5,793

⁽¹⁾ Includes unpaid claim amounts classified as Liabilities of business held for sale.

Activity in the Company’s liabilities for unpaid claims and claim expenses, excluding Other Operations, are presented in the following table. Liabilities associated with Other Operations are excluded because they pertain to obligations for long-duration insurance contracts or, if short-duration, the liabilities have been fully reinsured.

	Six Months Ended
(In millions)	June 30, 2020(1)		June 30, 2019
Beginning balance	$	5,816	$	5,432
Less: Reinsurance	184		156
Beginning balance, net	5,632		5,276
Incurred claims related to:
Current year	2,829		2,814
Prior years:
Interest accretion	81		81
All other incurred	(8)		(42)
Total incurred	2,902		2,853
Paid claims related to:
Current year	1,357		1,415
Prior years	1,353		1,275
Total paid	2,710		2,690
Foreign currency	(14)		(16)
Ending balance, net	5,810		5,423
Add: Reinsurance	180		175
Ending balance	$	5,990	$	5,598

(1) Includes Unpaid claims amounts classified as Liabilities of business held for sale.

Variances in Incurred Costs Related to Prior Years' Unpaid Claims and Claims Expenses

Variances in incurred costs related to prior years’ unpaid claims and claims expenses that resulted from the differences between actual experience and the Company’s key assumptions for the six months ended June 30 were as follows:

	Six Months Ended
(Dollars in millions)	June 30, 2020				June 30, 2019
	$		%(1)		$		%(2)
Actual completion factors	$	50	0.2	%	$	91	0.4	%
Medical cost trend	80		0.3		58		0.3
Total favorable variance	$	130	0.5	%	$	149	0.7	%

(1)Percentage of current year incurred costs as reported for the year ended December 31, 2019.

(2)Percentage of current year incurred costs as reported for the year ended December 31, 2018.

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Reinsurance (Tables)

6 Months Ended

Jun. 30, 2020

Effects of Reinsurance [Line Items]

Reinsurance Recoverables by Range of External Credit Rating and Collateral Level

The Company’s reinsurance recoverables are presented in the following table by range of external credit rating and collateral level.

(Dollars in millions)	Fair value of collateral contractually required to meet or exceed carrying value of recoverable		Collateral provisions exist that may mitigate risk of credit loss (3)		No collateral		Total
Ongoing Operations
Upper-medium grade and higher (1)	$	—	$	6	$	311	$	317
Lower-medium grade (2)	—		—		66		66
Not rated	89		14		17		120
Total recoverables related to ongoing operations (3)	$	89	$	20	$	394	$	503
Acquisition, disposition or runoff activities
Upper-medium grade and higher (1)
Lincoln National Life and Lincoln Life & Annuity of New York	—		3,064		—		3,064
Berkshire	329		493		—		822
Prudential Retirement Insurance and Annuity	660		—		—		660
Other	241		21		19		281
Not rated	—		40		3		43
Total recoverables related to acquisition, disposition or runoff activities	1,230		3,618		22		4,870
Total	$	1,319	$	3,638	$	416	$	5,373
Allowance for uncollectible reinsurance							(34)
Reinsurance recoverables classified as assets of business held for sale							(173)
Total reinsurance recoverables							$	5,166
(1) Includes A- equivalent and higher current ratings certified by a nationally recognized statistical rating organization ('NRSRO')
(2) Includes BBB- to BBB+ equivalent current credit ratings certified by a NRSRO
(3) This includes collateral provisions requiring the reinsurer to fully collateralize its obligation if its external credit rating is downgraded to a specified level

Effects of Reinsurance

In the Company’s Consolidated Statements of Income, premiums were reported net of amounts ceded to reinsurers and medical costs and other benefit expenses were reported net of reinsurance recoveries in the following amounts:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Total ceded premiums	$	117	$	126	$	245	$	256
Total reinsurance recoveries	$	102	$	53	$	280	$	112

Account Value, Net Amount at Risk and the Number of Contractholders for Guarantees Assumed in the Event of Death

The following table presents the account value, net amount at risk and the number of contractholders for guarantees assumed by the Company in the event of death. The net amount at risk is the amount that the Company would have to pay if all contractholders died as of the specified date. The Company should be reimbursed in full for these payments unless the Berkshire reinsurance limit is exceeded.

(Dollars in millions, excludes impact of reinsurance ceded)	June 30, 2020		December 31, 2019
Account value	$	8,424	$	9,110
Net amount at risk	$	1,776	$	1,764
Number of contractholders (estimated)	190,000		200,000

GMIB

Effects of Reinsurance [Line Items]

Schedule of Derivative Assets at Fair Value

There were three reinsurers covering 100% of the GMIB exposures as of June 30, 2020 and December 31, 2019 as follows:

(In millions)
Line of Business	Reinsurer	June 30, 2020		December 31, 2019		Collateral and Other Terms at June 30, 2020
GMIB	Berkshire	$	404	$	332	100% were secured by assets in a trust.
	Sun Life Assurance Company of Canada	249		202
	Liberty Re (Bermuda) Ltd.	218		179		96% were secured by assets in a trust.
Total GMIB recoverables reported in Other current assets and Other assets		$	871	$	713

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Investments (Tables)

6 Months Ended

Jun. 30, 2020

Investments [Abstract]

Investments by Category

The following table summarizes the Company's investments by category and current or long-term classification.

	June 30, 2020						December 31, 2019
(In millions)	Current		Long-term		Total		Current		Long-term		Total
Debt securities	$	1,046	$	22,628	$	23,674	$	928	$	22,827	$	23,755
Equity securities	—		373		373		—		303		303
Commercial mortgage loans	—		1,942		1,942		—		1,947		1,947
Policy loans	—		1,364		1,364		—		1,357		1,357
Other long-term investments	—		2,900		2,900		—		2,403		2,403
Short-term investments	456		—		456		423		—		423
Total	$	1,502	$	29,207	$	30,709	$	1,351	$	28,837	$	30,188
Investments classified as assets of business held for sale(1)	(312)		(7,869)		(8,181)		(414)		(7,295)		(7,709)
Investments per Consolidated Balance Sheets	$	1,190	$	21,338	$	22,528	$	937	$	21,542	$	22,479
(1) The table above includes $8.2 billion as of June 30, 2020 and $7.7 billion as of December 31, 2019 of investments associated with the U.S. Group Disability and Life business that are held for sale to New York Life. Under the terms of the definitive agreement, some of the assets currently associated with the Group Disability and Life business can be substituted for other assets. The assets that will transfer to New York Life will be primarily debt securities and to a lesser extent commercial mortgage loans and short-term investments.

Debt Securities by Contractual Maturity

The amortized cost and fair value by contractual maturity periods for debt securities were as follows at June 30, 2020:

(In millions)	Amortized Cost		Fair Value
Due in one year or less	$	1,049	$	1,059
Due after one year through five years	7,298		7,593
Due after five years through ten years	8,751		9,582
Due after ten years	4,053		4,969
Mortgage and other asset-backed securities	475		471
Total	$	21,626	$	23,674

Gross Unrealized Appreciation (Depreciation) on Debt Securities

Gross unrealized appreciation (depreciation) on debt securities by type of issuer is shown below.

(In millions)	Amortized Cost		Allowance for Credit Loss		Unrealized Appreciation		Unrealized Depreciation		Fair Value
June 30, 2020
Federal government and agency	$	415	$	—	$	222	$	—	$	637
State and local government	654		—		85		(2)		737
Foreign government	2,002		—		293		(9)		2,286
Corporate	18,080		(39)		1,663		(161)		19,543
Mortgage and other asset-backed	475		(9)		28		(23)		471
Total	$	21,626	$	(48)	$	2,291	$	(195)	$	23,674
Investments supporting liabilities of the Company’s run-off settlement annuity business (included in total above) (1)	$	2,209	$	(11)	$	803	$	(25)	$	2,976
December 31, 2019
Federal government and agency	$	498	$	—	$	235	$	—	$	733
State and local government	729		—		81		—		810
Foreign government	2,027		—		230		(1)		2,256
Corporate	18,149		—		1,299		(28)		19,420
Mortgage and other asset-backed	506		—		31		(1)		536
Total	$	21,909	$	—	$	1,876	$	(30)	$	23,755
Investments supporting liabilities of the Company’s run-off settlement annuity business (included in total above) (1)	$	2,229	$	—	$	740	$	(4)	$	2,965

(1)Net unrealized appreciation for these investments is excluded from accumulated other comprehensive income.

Summary of Debt Securities with a Decline in Fair Value

The table below summarizes debt securities with a decline in fair value from amortized cost by investment grade and the length of time these securities have been in an unrealized loss position. These debt securities are primarily corporate securities with a decline in fair value that reflects an increase in market yields since purchase. See discussion of Realized Investment Gains and Losses below for further information on the credit loss expense recorded for the Company's investments.

	June 30, 2020							December 31, 2019
(Dollars in millions)	Fair Value		Amortized Cost		Unrealized Depreciation		Number of Issues	Fair Value		Amortized Cost		Unrealized Depreciation		Number of Issues
One year or less
Investment grade	$	1,337	$	1,412	$	(75)	280	$	723	$	729	$	(6)	267
Below investment grade	$	968	$	1,055	$	(87)	831	$	340	$	348	$	(8)	355
More than one year
Investment grade	$	201	$	221	$	(20)	23	$	366	$	378	$	(12)	118
Below investment grade	$	75	$	88	$	(13)	35	$	84	$	88	$	(4)	93
Total	$	2,581	$	2,776	$	(195)	1,169	$	1,513	$	1,543	$	(30)	833

Roll-Forward of the Allowance for Credit Losses on Debt Securities

The table below presents a roll-forward of the allowance for credit losses on debt securities for the six months ended June 30, 2020.

(In millions)	2020
Beginning balance, January 1, 2020	$	0
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	55
Balance at March 31, 2020	55
Second Quarter Activity:
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	25
Reductions for securities sold during the period	(9)
Net reductions to allowance for credit losses on securities that had an allowance recorded in a previous period	(23)
Ending balance, June 30, 2020	$	48

Equity Security Investments

The following table provides the values of the Company's equity security investments as of June 30, 2020 and December 31, 2019.

	June 30, 2020				December 31, 2019
(Dollars in millions)	Amortized Cost		Carrying Value		Amortized Cost		Carrying Value
Equity securities with readily determinable fair values	$	140	$	134	$	61	$	64
Equity securities with no readily determinable fair value	$	187	$	196	$	183	$	192
Hybrid equity securities	$	58	$	43	$	58	$	47
Total	$	385	$	373	$	302	$	303

Summary of the Credit Risk Profile of the Commercial Mortgage Loan Portfolio

The following table summarizes the credit risk profile of the Company’s commercial mortgage loan portfolio based on loan-to-value and debt service coverage ratios as of June 30, 2020 and December 31, 2019:

(Dollars in millions)	June 30, 2020					December 31, 2019
Loan-to-Value Ratio	Carrying Value		Average Debt Service Coverage Ratio	Average Loan-to-Value Ratio		Carrying Value		Average Debt Service Coverage Ratio	Average Loan-to-Value Ratio
Below 60%	$	904	2.18			$	1,136	2.19
60% to 79%	903		1.94			723		1.98
80% to 100%	143		1.33			88		1.62
Allowance for credit losses	(8)
Total	$	1,942	2.01	60	%	$	1,947	2.09	58	%

Carrying Value Information for Other Long-Term Investments

Other long-term investments also include investment real estate, foreign currency swaps, and statutory and other deposits. The following table provides carrying value information for these investments.

	Carrying value as of
(In millions)	June 30, 2020		December 31, 2019
Real estate investments	$	850	$	788
Securities partnerships	1,525		1,409
Other	525		206
Total	$	2,900	$	2,403

Short-Term Investments and Cash Equivalents

Short-term investments and cash equivalents included the following types of issuers:

(In millions)	June 30, 2020		December 31, 2019
Corporate securities	$	4,266	$	1,985
Federal government securities	$	482	$	472
Foreign government securities	$	32	$	65
Money market funds	$	814	$	631

Realized Gains and Losses on Investments

The following realized gains and losses on investments exclude amounts required to adjust future policy benefits for the run-off settlement annuity business (consistent with accounting for a premium deficiency), as well as realized gains and losses attributed to the Company’s separate accounts because those gains and losses generally accrue directly to separate account policyholders.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Net realized investment gains, excluding credit loss expense and asset write-downs	$	33	$	25	$	9	$	36
Credit loss expense on invested assets	6		—		(49)		—
Other investment asset write-downs	(1)		(2)		(10)		(3)
Net realized investment gains (losses), before income taxes	$	38	$	23	$	(50)	$	33

Sales Information for Available-for-Sale Debt Securities

The following table presents sales information for available-for-sale debt securities. Gross gains on sales and gross losses on sales exclude amounts required to adjust future policy benefits for the run-off settlement annuity business.

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Proceeds from sales	$	880	$	565	$	1,623	$	1,651
Gross gains on sales	$	27	$	9	$	66	$	23
Gross losses on sales	$	(14)	$	(2)	$	(21)	$	(12)

Summary of Derivative Instruments Held

The following table summarizes the types and notional quantity of derivative instruments held by the Company. As of June 30, 2020 and December 31, 2019, the effects of these individual hedging strategies were not material to the Consolidated Financial Statements, including gains or losses reclassified from accumulated other comprehensive income into shareholders' net income, as well as amounts excluded from the assessment of hedge effectiveness.

	(In millions)	Notional Value as of
		June 30, 2020		December 31, 2019
Purpose	Type of Instrument
Fair value hedge: To hedge the foreign exchange-related changes in fair values of certain foreign-denominated bonds. The notional value of these derivatives matches the amortized cost of the hedged bonds.	Foreign currency swap contracts	$	817	$	817
Net investment hedge: To reduce the risk of changes in net assets due to changes in foreign currency spot exchange rates for certain foreign subsidiaries that conduct their business principally in Euros, Korean Won, and Taiwan Dollar. The notional value of hedging instruments matches the hedged amount of subsidiary net assets.	Foreign currency swap contracts	$	526	$	438
	Foreign currency forward contracts	$	606	$	406
Economic hedge: To hedge the foreign exchange-related changes in fair value of a U.S. dollar-denominated bond portfolio to reflect the local currency for the Company’s foreign subsidiary in South Korea. The notional value of hedging instruments generally aligns with the fair value of the hedged bond portfolio.	Foreign currency forward contracts	$	442	$	410

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Financial Assets and Financial Liabilities Carried at Fair Value

The following table provides information as of June 30, 2020 and December 31, 2019 about the Company’s financial assets and liabilities carried at fair value. Separate account assets are also recorded at fair value on the Company’s Consolidated Balance Sheets and are reported separately in the Separate Accounts section below as gains and losses related to these assets generally accrue directly to policyholders.

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
	As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019		As of June 30, 2020		As of December 31, 2019
Financial assets at fair value
Debt securities
Federal government and agency	$	192	$	197	$	445	$	536	$	—	$	—	$	637	$	733
State and local government	—		—		737		810		—		—		737		810
Foreign government	—		—		2,260		2,228		26		28		2,286		2,256
Corporate	—		—		18,889		19,063		654		357		19,543		19,420
Mortgage and other asset-backed	—		—		322		398		149		138		471		536
Total debt securities	192		197		22,653		23,035		829		523		23,674		23,755
Equity securities (1)	1		7		145		72		31		32		177		111
Short-term investments	—		—		456		423		—		—		456		423
Derivative assets	—		—		193		83		—		—		193		83
Real estate funds priced at NAV as a practical expedient (2)													168		184
Financial liabilities at fair value
Derivative liabilities	$	—	$	—	$	15	$	18	$	—	$	—	$	15	$	18

(1)Excludes certain equity securities that have no readily determinable fair value.

(2)As a practical expedient, certain real estate funds are carried at fair value based on the Company’s ownership share of the equity of the investee (Net Asset Value (“NAV“)) including changes in the fair value of its underlying investments. The Company has $55 million in unfunded commitments in these funds as of June 30, 2020

Fair Value and Significant Unobservable Inputs Used in Pricing Debt Securities

The following table summarizes the fair value and significant unobservable inputs used in pricing the following debt securities that were developed directly by the Company as of June 30, 2020 and December 31, 2019. The range and weighted average basis point (“bps”) amounts for liquidity and credit spreads (adjustment to discount rates) reflect the Company’s best estimates of the unobservable adjustments a market participant would make to calculate these fair values. These inputs have increased over the reported periods, resulting from continued uncertainty over the economic impacts related to COVID-19.

Corporate and government debt securities. The significant unobservable input used to value the following corporate and government debt securities is an adjustment for liquidity. This adjustment is needed to reflect current market conditions and issuer circumstances when there is limited trading activity for the security.

Mortgage and other asset-backed securities. The significant unobservable inputs used to value the following mortgage and other asset-backed securities are liquidity and weighting of credit spreads. An adjustment for liquidity is made as of the measurement date that considers current market conditions, issuer circumstances and complexity of the security structure when there is limited trading activity for the security. An adjustment to weight credit spreads is needed to value a more complex bond structure with multiple underlying collateral and no standard market valuation technique. The weighting of credit spreads is primarily based on the underlying collateral’s characteristics and their proportional cash flows supporting the bond obligations.

	Fair Value as of					Unobservable Adjustment Range (Weighted Average by Quantity) as of
(Fair value in millions )	June 30, 2020		December 31, 2019		Unobservable input June 30, 2020	June 30, 2020	December 31, 2019
Debt securities
Corporate and government debt securities	$	678	$	385	Liquidity	70 - 1700 (390) bps	70 - 930 (280) bps
Mortgage and other asset-backed securities	149		138		Liquidity	60 - 370 (70) bps	60 - 370 (70) bps
					Weighting of credit spreads	310 - 620 (440) bps	240 - 460 (330) bps
Securities not priced by the Company (1)	2		—
Total Level 3 debt securities	$	829	$	523

(1)The fair values for these securities use single, unadjusted non-binding broker quotes not developed directly by the Company.

Changes in Level 3 Financial Assets and Financial Liabilities Carried at Fair Value

The following tables summarize the changes in financial assets and financial liabilities classified in Level 3 for the three and six months ended June 30, 2020 and 2019. Gains and losses reported in these tables may include net changes in fair value that are attributable to both observable and unobservable inputs.

Debt and Equity Securities
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Balance at beginning of period	$	766	$	436	$	555	$	410
Total gains (losses) included in shareholders’ net income	17		—		5		(1)
Gains (losses) included in other comprehensive income	12		5		(59)		12
Gains (losses) required to adjust future policy benefits for settlement annuities (1)	7		—		(3)		2
Purchases, sales and settlements
Purchases	2		43		64		43
Sales	—		—		(12)		—
Settlements	(5)		(9)		(7)		(10)
Total purchases, sales and settlements	$	(3)	$	34	$	45	$	33
Transfers into/(out of) Level 3
Transfers into Level 3	179		13		527		33
Transfers out of Level 3	(118)		(57)		(210)		(58)
Total transfers into/(out of) Level 3	$	61	$	(44)	$	317	$	(25)
Balance at June 30,	$	860	$	431	$	860	$	431
Total gains (losses) included in shareholders’ net income attributable to instruments held at the reporting date	$	16	$	(1)	$	(1)	$	(1)
Change in unrealized gains or losses included in other comprehensive income for assets held at the end of the reporting period	$	12	N/A		$	(54)	N/A

(1)Amounts do not accrue to shareholders.

Fair Values of Separate Account Assets

Fair values of separate account assets at June 30, 2020 and December 31, 2019 were as follows:

(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
	June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019		June 30, 2020		December 31, 2019
Guaranteed separate accounts (See Note 18)	$	203	$	219	$	298	$	271	$	—	$	—	$	501	$	490
Non-guaranteed separate accounts (1)	1,485		1,450		5,228		5,522		334		263		7,047		7,235
Subtotal	$	1,688	$	1,669	$	5,526	$	5,793	$	334	$	263	$	7,548	$	7,725
Non-guaranteed separate accounts priced at NAV as a practical expedient (1)													727		756
Total													$	8,275	$	8,481
Separate account assets of business classified as held for sale													(14)		(16)
Separate account assets per Consolidated Balance Sheets													$	8,261	$	8,465

(1)Non-guaranteed separate accounts included $3.9 billion as of June 30, 2020 and $4.0 billion as of December 31, 2019 in assets supporting the Company’s pension plans, including $0.3 billion classified in Level 3 as of June 30, 2020 and $0.2 billion classified in Level 3 as of December 31, 2019.

Additional Information on Separate Account Assets Priced at NAV

The following table provides additional information on these investments.

	Fair Value as of				Unfunded Commitment as of June 30, 2020		Redemption Frequency (if currently eligible)	Redemption Notice Period
(In millions)	June 30, 2020		December 31, 2019
Securities partnerships	$	499	$	531	$	314	Not applicable	Not applicable
Real estate funds	224		220		—		Quarterly	30 - 90 days
Hedge funds	4		5		—		Up to annually, varying by fund	30 - 90 days
Total	$	727	$	756	$	314

Fair Value Disclosures for Financial Instruments Not Carried at Fair Value

The following table includes the Company’s financial instruments not recorded at fair value that are subject to fair value disclosure requirements at June 30, 2020 and December 31, 2019. In addition to universal life products and finance leases, financial instruments that are carried in the Company’s Consolidated Financial Statements at amounts that approximate fair value are excluded from the following table.

		June 30, 2020				December 31, 2019
(In millions)	Classification in Fair Value Hierarchy	Fair Value		Carrying Value		Fair Value		Carrying Value
Commercial mortgage loans	Level 3	$	1,990	$	1,942	$	1,989	$	1,947
Long-term debt, including current maturities, excluding finance leases	Level 2	$	40,310	$	35,054	$	39,439	$	36,375

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2020

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Changes in the Components of AOCI

Changes in the components of AOCI were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Securities and Derivatives
Beginning balance	$	547	$	460	$	975	$	18
Appreciation on securities and derivatives	920		442		340		1,007
Tax (expense)	(197)		(94)		(69)		(216)
Net appreciation on securities and derivatives	723		348		271		791
Reclassification adjustment for losses (gains) included in shareholders' net income (net realized investment losses (gains))	(19)		(6)		13		(7)
Tax (expense) benefit	5		1		(3)		1
Net losses (gains) reclassified from AOCI to net income	(14)		(5)		10		(6)
Other comprehensive income, net of tax	709		343		281		785
Ending balance	$	1,256	$	803	$	1,256	$	803
Translation of foreign currencies
Beginning balance	$	(446)	$	(245)	$	(275)	$	(221)
Translation of foreign currencies	65		(42)		(95)		(67)
Tax (expense) benefit	5		—		(10)		(1)
Net translation of foreign currencies	70		(42)		(105)		(68)
Less: Net translation of foreign currencies attributable to noncontrolling interests	(2)		(2)		(6)		(4)
Shareholders' net translation of foreign currencies	72		(40)		(99)		(64)
Ending balance	$	(374)	$	(285)	$	(374)	$	(285)
Postretirement benefits liability
Beginning balance	$	(1,628)	$	(1,497)	$	(1,641)	$	(1,508)
Reclassification adjustment for amortization of net losses from past experience and prior service costs (interest expense and other)	18		16		36		31
Reclassification adjustment for settlement (interest expense and other)	—		—		—		10
Tax (expense) benefit	(4)		5		(9)		(9)
Net adjustments reclassified from AOCI to net income	14		21		27		32
Valuation update	(73)		(8)		(73)		(8)
Tax benefit	17		1		17		1
Net change due to valuation update	(56)		(7)		(56)		(7)
Other comprehensive (loss) income, net of tax	(42)		14		(29)		25
Ending balance	$	(1,670)	$	(1,483)	$	(1,670)	$	(1,483)

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Leases (Tables)

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Operating and Finance Lease Right of Use ("ROU") Assets and Lease Liabilities

Operating and finance lease right of use ("ROU") assets and lease liabilities were as follows:

(In millions)	June 30, 2020		December 31, 2019
Operating leases:
Operating lease ROU assets	$	544	$	536
Accrued expenses and other current liabilities	$	158	$	166
Other non-current liabilities	482		465
Total operating lease liabilities	$	640	$	631
Finance leases:
Property and equipment, gross	$	98	$	110
Accumulated depreciation	(35)		(23)
Property and equipment, net	$	63	$	87
Short-term debt	$	22	$	27
Long-term debt	43		61
Total finance lease liabilities	$	65	$	88

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Summary of Special Items

The following tables present the special items recorded by the Company for the three and six months ended June 30, 2020 and 2019.

	Three Months Ended
(In millions)	June 30, 2020				June 30, 2019
Description of special item charges (benefits) and financial statement line item(s)	After-tax		Before-tax		After-tax		Before-tax
Debt extinguishment costs (Debt extinguishment costs)	$	11	$	14	$	—	$	—
Integration and transaction-related costs (Selling, general and administrative expenses)	99		130		115		155
Charges associated with litigation matters (Selling, general and administrative expenses)	—		—		64		81
Total impact from special items	$	110	$	144	$	179	$	236

	Six Months Ended
(In millions)	June 30, 2020				June 30, 2019
Description of Special Item Charges (Benefits) and Financial Statement Line Item(s)	After-tax		Before-tax		After-tax		Before-tax
Debt extinguishment costs (Debt extinguishment costs)	$	151	$	199	$	—	$	—
Integration and transaction-related costs (Selling, general and administrative expenses)	173		227		223		291
Charge for organizational efficiency plan (Selling, general and administrative expenses)	24		31		—		—
Charges associated with litigation matters (Selling, general and administrative expenses)	19		25		64		81
Contractual adjustment for a former client (Pharmacy revenues)	(66)		(87)		—		—
Total impact from special items	$	301	$	395	$	287	$	372

Summarized Segment Financial Information

Summarized segment financial information for the three and six months ended June 30 was as follows:

(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Three months ended June 30, 2020
Revenues from external customers	$	27,714	$	8,684	$	1,466	$	1,178	$	—	$	39,042
Inter-segment revenues	885		504		—		6		(1,395)
Net investment income	3		49		26		144		1		223
Total revenues	28,602		9,237		1,492		1,328		(1,394)		39,265
Net realized investment results from certain equity method investments	—		—		(60)		—		—		(60)
Adjusted revenues	$	28,602	$	9,237	$	1,432	$	1,328	$	(1,394)	$	39,205
Income (loss) before taxes	$	771	$	1,543	$	390	$	129	$	(544)	$	2,289
Pre-tax adjustments to reconcile to adjusted income from operations
(Income) attributable to noncontrolling interests	(3)		—		(5)		—		—		(8)
Net realized investment losses	—		(26)		(73)		1		—		(98)
Amortization of acquired intangible assets	481		6		7		2		—		496
Special items
Debt extinguishment costs	—		—		—		—		14		14
Integration and transaction-related costs	—		—		—		—		130		130
Pre-tax adjusted income (loss) from operations	$	1,249	$	1,523	$	319	$	132	$	(400)	$	2,823
(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Three months ended June 30, 2019
Revenues from external customers	$	27,337	$	8,668	$	1,343	$	1,131	$	—	$	38,479
Inter-segment revenues	633		189		—		7		(829)
Net investment income	17		111		40		171		1		340
Total revenues	27,987		8,968		1,383		1,309		(828)		38,819
Revenue contributions from transitioning clients	(4,450)		—		—		—		—		(4,450)
Net realized investment results from certain equity method investments	—		—		6		—		—		6
Adjusted revenues	$	23,537	$	8,968	$	1,389	$	1,309	$	(828)	$	34,375
Income (loss) before taxes	$	1,108	$	989	$	195	$	155	$	(689)	$	1,758
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients	(655)		—		—		—		—		(655)
(Income) attributable to noncontrolling interests	—		—		(4)		—		—		(4)
Net realized investment (gains) losses	—		(17)		8		(8)		—		(17)
Amortization of acquired intangible assets	709		18		8		2		—		737
Special items
Integration and transaction-related costs	—		—		—		—		155		155
Charges associated with litigation matters	—		—		—		—		81		81
Pre-tax adjusted income (loss) from operations	$	1,162	$	990	$	207	$	149	$	(453)	$	2,055

(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Six Months Ended June 30, 2020
Revenues from external customers	$	53,970	$	17,952	$	2,886	$	2,350	$	—	$	77,158
Inter-segment revenues	1,859		970		—		11		(2,840)		—
Net investment income	28		175		66		306		1		576
Total revenues	55,857		19,097		2,952		2,667		(2,839)		77,734
Net realized investment results from certain equity method investments	—		—		(50)		—		—		(50)
Special items	(87)		—		—		—		—		(87)
Adjusted revenues	$	55,770	$	19,097	$	2,902	$	2,667	$	(2,839)	$	77,597
Income (loss) before taxes	$	1,465	$	2,683	$	624	$	201	$	(1,287)	$	3,686
Pre-tax adjustments to reconcile to adjusted income from operations
(Income) attributable to noncontrolling interests	(7)		—		(10)		—		—		(17)
Net realized investment losses	—		22		(27)		5		—		—
Amortization of acquired intangible assets	960		17		14		3		—		994
Special items
Debt extinguishment costs	—		—		—		—		199		199
Integration and transaction-related costs	—		—		—		—		227		227
Charge for organizational efficiency plan	—		—		—		—		31		31
Charges associated with litigation matters	—		—		—		—		25		25
Contractual adjustment for a former client	(87)		—		—		—		—		(87)
Pre-tax adjusted income (loss) from operations	$	2,331	$	2,722	$	601	$	209	$	(805)	$	5,058
(In millions)	Health Services		Integrated Medical		International Markets		Group Disability and Other		Corporate and Eliminations		Total
Six Months Ended June 30, 2019
Revenues from external customers	$	53,534	$	17,578	$	2,727	$	2,240	$	—	$	76,079
Inter-segment revenues	1,370		351		—		14		(1,735)
Net investment income (loss)	32		234		78		351		(9)		686
Total revenues	54,936		18,163		2,805		2,605		(1,744)		76,765
Revenue contribution from transitioning clients	(8,939)		—		—		—		—		(8,939)
Net realized investment results from certain equity method investments	—		—		(22)		—		—		(22)
Adjusted revenues	$	45,997	$	18,163	$	2,783	$	2,605	$	(1,744)	$	67,804
Income (loss) before taxes	$	2,050	$	2,146	$	417	$	248	$	(1,315)	$	3,546
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients	(1,315)		—		—		—		—		(1,315)
(Income) attributable to noncontrolling interests	(1)		—		(8)		—		—		(9)
Net realized investment (gains)	—		(22)		(15)		(18)		—		(55)
Amortization of acquired intangible assets	1,422		36		19		3		—		1,480
Special items
Integration and transaction-related costs	—		—		—		—		291		291
Charges associated with litigation matters	—		—		—		—		81		81
Pre-tax adjusted income (loss) from operations	$	2,156	$	2,160	$	413	$	233	$	(943)	$	4,019

Revenue from External Customers

Revenue from external customers includes pharmacy revenues, premiums and fees and other revenues. The following table presents these revenues by product, premium and service type for the three and six months ended June 30:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Products (Pharmacy revenues) (ASC 606)
Network revenues	13,090		12,758		25,232		25,031
Home delivery and specialty revenues	$	12,183	$	12,272	$	23,897	$	24,056
Other	1,291		1,258		2,533		2,380
Total pharmacy revenues	26,564		26,288		51,662		51,467
Insurance premiums (ASC 944)
Integrated Medical premiums
Commercial
Health Insurance	3,090		3,065		6,551		6,104
Stop loss	1,152		1,067		2,313		2,136
Other	283		241		572		519
Government
Medicare Advantage	1,904		1,610		3,785		3,217
Medicare Part D	420		400		882		925
Other	1,063		1,013		2,129		2,078
Total Integrated Medical premiums	7,912		7,396		16,232		14,979
International Markets premiums	1,344		1,301		2,719		2,605
Domestic disability, life and accident premiums	1,124		1,069		2,240		2,116
Other premiums	26		37		55		74
Total premiums	10,406		9,803		21,246		19,774
Services (ASC 606)
Fees	1,979		2,376		4,133		4,766
Other external revenues	93		12		117		72
Total services	2,072		2,388		4,250		4,838
Total revenues from external customers	$	39,042	$	38,479	$	77,158	$	76,079

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COVID-19 and Related Economic Impact (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		6 Months Ended
	Apr. 30, 2020	Sep. 30, 2020	Jun. 30, 2020	Jun. 30, 2020	Jan. 01, 2020
Unusual or Infrequent Item, or Both [Line Items]
Allowance for current expected credit losses on accounts receivable			$ 72	$ 72	$ 39
Deferred income and payroll tax payments as permitted by the CARES Act			900
Proceeds from provider relief fund, CARES Act	$ 41
Return of proceeds to the provider relief fund, CARES Act	$ 41
Forecast
Unusual or Infrequent Item, or Both [Line Items]
Deferred tax payments, CARES Act		$ 825
COVID-19
Unusual or Infrequent Item, or Both [Line Items]
Impairments of long-lived assets
Allowance for expected credit losses related to investments			48	48
Allowance for current expected credit losses on accounts receivable			$ 13	$ 13

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Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2019		Dec. 31, 2018	Mar. 31, 2020	Jan. 01, 2020	Jun. 30, 2019	Mar. 31, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stockholders' equity	$ 47,371	$ 45,344		$ 41,035	$ 45,086		$ 43,818	$ 42,413
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201613Member	us-gaap:AccountingStandardsUpdate201613Member		us-gaap:AccountingStandardsUpdate201602Member
Retained Earnings
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stockholders' equity	$ 23,052	$ 20,162		$ 15,088	$ 21,298		$ 17,834	$ 16,426
Adjustment upon Adoption
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stockholders' equity		(30)	[1]	(15)
Adjustment upon Adoption | Retained Earnings
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Stockholders' equity		$ (30)	[1]	$ (15)		$ (30)

[1] See Note 3 for further information about the Company's adoption of new credit loss guidance (ASU 2016-13).

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Accounts Receivable, Net - Summary of Accounts Receivable, Net (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Receivables [Abstract]
Noninsurance customer receivables	$ 5,678	$ 5,143
Pharmaceutical manufacturers receivable	4,654	3,439
Insurance customer receivables	2,607	2,321
Other receivables	386	334
Total	13,325	11,237
Accounts receivable, net classified as assets of business held for sale	(631)	(521)
Accounts receivable, net per Consolidated Balance Sheets	$ 12,694	$ 10,716

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Accounts Receivable, Net - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2020	Jan. 01, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for receivables net current	$ 1,100		$ 778
Allowance for current expected credit losses on accounts receivable	72	$ 39
Adjustment upon Adoption
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for current expected credit losses on accounts receivable
COVID-19
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for current expected credit losses on accounts receivable	$ 13

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Mergers and Acquisitions (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Business Combinations [Abstract]
Integration and transaction-related costs, pre-tax	$ 130	$ 155	$ 227	$ 291
Integration and transaction-related costs, after-tax	$ 99	$ 115	$ 173	$ 223

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Assets and Liabilities of Business Held for Sale - Narrative (Details) $ in Billions	Dec. 31, 2019 USD ($)
Group Disability and Life | Held-for-Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale price	$ 6.3

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Assets and Liabilities of Business Held for Sale - Assets and Liabilities Held for Sale (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Accounts receivable, net	$ 631	$ 521
Investments	8,200	7,700
Total assets of business held for sale	9,788	9,512
Insurance and contractholder liabilities	6,549	6,308
Total liabilities of business held for sale	7,109	6,812
Group Disability and Life | Held-for-Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash and cash equivalents	418	743
Accounts receivable, net	631	521
Investments	8,181	7,709
Other assets	558	539
Total assets of business held for sale	9,788	9,512
Insurance and contractholder liabilities	6,549	6,308
Other liabilities	560	504
Total liabilities of business held for sale	$ 7,109	$ 6,812

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Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Earnings Per Share [Abstract]
Shareholders’ net income	$ 1,754	$ 1,408	$ 2,935	$ 2,776
Shares:
Weighted average (in shares)	367,396	377,962	368,918	378,672
Common stock equivalents (in shares)	3,301	3,007	3,750	3,824
Total shares (in shares)	370,697	380,969	372,668	382,496
EPS, basic (in dollars per share)	$ 4.77	$ 3.73	$ 7.96	$ 7.33
EPS, effect of dilution (in dollars per share)	(0.04)	(0.03)	(0.08)	(0.07)
EPS, diluted (in dollars per share)	$ 4.73	$ 3.70	$ 7.88	$ 7.26

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Earnings Per Share - Outstanding Employee Stock Options Not Included in the Computation of Diluted Earnings Per Share (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Employee Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive options (in shares)	4.0	5.4	4.0	4.1

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Earnings Per Share - Narrative (Details) - shares shares in Millions	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Income Statement [Abstract]
Shares of common stock held in treasury (in shares)	20.8	13.0	6.2

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Debt - Outstanding Amounts of Debt and Finance Leases (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Short-term debt
Commercial paper	$ 5,000,000	$ 944,000,000
Other, including finance leases	22,000,000	27,000,000
Total short-term debt	4,750,000,000	5,514,000,000
Long-term debt
Other, including finance leases	43,000,000	61,000,000
Total long-term debt	31,774,000,000	31,893,000,000
$1,000 million, Floating Rate Notes due 3/2020
Short-term debt
Current maturities	0	999,000,000
Long-term debt
Face value	1,000,000,000
$300 million, 5.125% Notes due 6/2020
Short-term debt
Current maturities	0	300,000,000
Long-term debt
Face value	$ 300,000,000
Stated interest rate	5.125%
$1,750 million, 3.2% Notes due 9/2020
Short-term debt
Current maturities	$ 1,750,000,000	1,748,000,000
Long-term debt
Face value	$ 1,750,000,000
Stated interest rate	3.20%
$349 million, 4.125% Notes due 9/2020
Short-term debt
Current maturities	$ 349,000,000	351,000,000
Long-term debt
Face value	$ 349,000,000
Stated interest rate	4.125%
$500 million, 2.6% Notes due 11/2020
Short-term debt
Current maturities	$ 498,000,000	496,000,000
Long-term debt
Face value	$ 500,000,000
Stated interest rate	2.60%
$400 million, Floating Rate Notes due 11/2020
Short-term debt
Current maturities	$ 400,000,000	400,000,000
Long-term debt
Face value	400,000,000
$250 million, 4.375% Notes due 12/2020
Short-term debt
Current maturities	250,000,000	249,000,000
Long-term debt
Face value	$ 250,000,000
Stated interest rate	4.375%
$1,400 million, Floating Rate Term Loan due 3/2021
Short-term debt
Current maturities	$ 1,398,000,000	0
Long-term debt
Face value	1,400,000,000
$78 million, 6.37% Notes due 6/2021
Short-term debt
Current maturities	78,000,000	0
Long-term debt
Long-term debt	0	78,000,000
Face value	$ 78,000,000
Stated interest rate	6.37%
$500 million, 3.3% Notes due 2021
Long-term debt
Long-term debt	$ 0	499,000,000
Face value	$ 500,000,000
Stated interest rate	3.30%
$300 million, 4.5% Notes due 2021
Long-term debt
Long-term debt	$ 0	298,000,000
Face value	$ 300,000,000
Stated interest rate	4.50%
$1,000 million, Floating Rate Notes due 2021
Long-term debt
Long-term debt	$ 998,000,000	998,000,000
Face value	1,000,000,000
$1,250 million, 3.4% Notes due 2021
Long-term debt
Long-term debt	1,248,000,000	1,247,000,000
Face value	$ 1,250,000,000
Stated interest rate	3.40%
$1,248 million, 4.75% Notes due 2021
Long-term debt
Long-term debt	$ 0	1,272,000,000
Face value	$ 1,248,000,000
Stated interest rate	4.75%
$277 million, 4% Notes due 2022
Long-term debt
Long-term debt	$ 276,000,000	747,000,000
Face value	$ 277,000,000
Stated interest rate	4.00%
$973 million, 3.9% Notes due 2022
Long-term debt
Long-term debt	$ 972,000,000	999,000,000
Face value	$ 973,000,000
Stated interest rate	3.90%
$500 million, 3.05% Notes due 2022
Long-term debt
Long-term debt	$ 488,000,000	485,000,000
Face value	$ 500,000,000
Stated interest rate	3.05%
$17 million, 8.3% Notes due 2023
Long-term debt
Long-term debt	$ 17,000,000	17,000,000
Face value	$ 17,000,000
Stated interest rate	8.30%
$63 million, 7.65% Notes due 2023
Long-term debt
Long-term debt	$ 63,000,000	100,000,000
Face value	$ 63,000,000
Stated interest rate	7.65%
$700 million, Floating Rate Notes due 2023
Long-term debt
Long-term debt	$ 698,000,000	698,000,000
Face value	700,000,000
$1,000 million, 3% Notes due 2023
Long-term debt
Long-term debt	971,000,000	966,000,000
Face value	$ 1,000,000,000
Stated interest rate	3.00%
$2,187 million, 3.75% Notes due 2023
Long-term debt
Long-term debt	$ 2,180,000,000	3,088,000,000
Face value	$ 2,187,000,000
Stated interest rate	3.75%
$1,000 million, 3.5% Notes due 2024
Long-term debt
Long-term debt	$ 974,000,000	970,000,000
Face value	$ 1,000,000,000
Stated interest rate	3.50%
$900 million, 3.25% Notes due 2025
Long-term debt
Long-term debt	$ 895,000,000	895,000,000
Face value	$ 900,000,000
Stated interest rate	3.25%
$2,200 million, 4.125% Notes due 2025
Long-term debt
Long-term debt	$ 2,189,000,000	2,188,000,000
Face value	$ 2,200,000,000
Stated interest rate	4.125%
$1,500 million, 4.5% Notes due 2026
Long-term debt
Long-term debt	$ 1,505,000,000	1,506,000,000
Face value	$ 1,500,000,000
Stated interest rate	4.50%
$1,500 million, 3.4% Notes due 2027
Long-term debt
Long-term debt	$ 1,404,000,000	1,396,000,000
Face value	$ 1,500,000,000
Stated interest rate	3.40%
$259 million, 7.875% Debentures due 2027
Long-term debt
Long-term debt	$ 259,000,000	259,000,000
Face value	$ 259,000,000
Stated interest rate	7.875%
$600 million, 3.05% Notes due 2027
Long-term debt
Long-term debt	$ 595,000,000	595,000,000
Face value	$ 600,000,000
Stated interest rate	3.05%
$3,800 million, 4.375% Notes due 2028
Long-term debt
Long-term debt	$ 3,778,000,000	3,776,000,000
Face value	$ 3,800,000,000
Stated interest rate	4.375%
$1,500 million, 2.4% Notes due 2030
Long-term debt
Long-term debt	$ 1,489,000,000	0
Face value	$ 1,500,000,000
Stated interest rate	2.40%
$45 million, 8.3% Step Down Notes due 2033
Long-term debt
Long-term debt	$ 45,000,000	45,000,000
Face value	$ 45,000,000
Stated interest rate	8.30%
$190 million, 6.15% Notes due 2036
Long-term debt
Long-term debt	$ 190,000,000	190,000,000
Face value	$ 190,000,000
Stated interest rate	6.15%
$2,200 million, 4.8% Notes due 2038
Long-term debt
Long-term debt	$ 2,179,000,000	2,178,000,000
Face value	$ 2,200,000,000
Stated interest rate	4.80%
$750 million, 3.2% Notes due 2040
Long-term debt
Long-term debt	$ 742,000,000	0
Face value	$ 750,000,000
Stated interest rate	3.20%
$121 million, 5.875% Notes due 2041
Long-term debt
Long-term debt	$ 119,000,000	119,000,000
Face value	$ 121,000,000
Stated interest rate	5.875%
$448 million, 6.125% Notes due 2041
Long-term debt
Long-term debt	$ 490,000,000	491,000,000
Face value	$ 448,000,000
Stated interest rate	6.125%
$317 million, 5.375% Notes due 2042
Long-term debt
Long-term debt	$ 315,000,000	315,000,000
Face value	$ 317,000,000
Stated interest rate	5.375%
$1,500 million, 4.8% Notes due 2046
Long-term debt
Long-term debt	$ 1,464,000,000	1,465,000,000
Face value	$ 1,500,000,000
Stated interest rate	4.80%
$1,000 million, 3.875% Notes due 2047
Long-term debt
Long-term debt	$ 988,000,000	988,000,000
Face value	$ 1,000,000,000
Stated interest rate	3.875%
$3,000 million, 4.9% Notes due 2048
Long-term debt
Long-term debt	$ 2,965,000,000	2,964,000,000
Face value	$ 3,000,000,000
Stated interest rate	4.90%
$1,250 million, 3.4% Notes due 2050
Long-term debt
Long-term debt	$ 1,235,000,000	$ 0
Face value	$ 1,250,000,000
Stated interest rate	3.40%

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Debt - Narrative (Details)		2 Months Ended	3 Months Ended			6 Months Ended
	Apr. 01, 2020 USD ($)	Apr. 30, 2020 USD ($)	Jun. 30, 2020 USD ($) bank	Dec. 31, 2019 USD ($) bank	Jun. 30, 2019 USD ($)	Jun. 30, 2020 USD ($) bank	Jun. 30, 2019 USD ($)	Mar. 16, 2020 USD ($)
Debt Instrument [Line Items]
Aggregate principal amount of outstanding debt securities under tender offer and optional redemption		$ 3,500,000,000
Aggregate principal amount of outstanding debt securities repurchased under tender offer		1,500,000,000
Aggregate principal amount of outstanding debt securities repurchased under optional redemption		2,000,000,000.0
Loss on repurchase of debt, pre-tax		199,000,000	$ 14,000,000		$ 0	$ 199,000,000	$ 0
Loss on repurchase of debt, after-tax		$ 151,000,000
Notes issued by Express Scripts, Medco and Old Cigna exchanged for Notes issued by Cigna				$ 12,700,000,000
Repayment of long-term debt						4,798,000,000	$ 2,740,000,000
Payments for debt tender and redemption						3,500,000,000
Commercial paper			$ 5,000,000	$ 944,000,000		$ 5,000,000
Commercial Paper
Debt Instrument [Line Items]
Weighted-average interest rate			1.00%			1.00%
Revolving Credit Agreement
Debt Instrument [Line Items]
Number of participating banks | bank			23			23
Maximum borrowing capacity			$ 3,250,000,000			$ 3,250,000,000
Amount by which credit facilty amount can be increased			$ 500,000,000			$ 500,000,000
Amount by which credit facilty term length can be increased						1 year
Leverage ratio covenant			60.00%			60.00%
Outstanding balances			$ 0			$ 0
Revolving Credit Agreement | Letter of Credit
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 500,000,000			$ 500,000,000
364-day Revolving Credit Agreement | Revolving Credit Facility
Debt Instrument [Line Items]
Number of participating banks | bank				23
Maximum borrowing capacity				$ 1,000,000,000.0
Credit agreement term				364 days
Leverage ratio covenant			60.00%			60.00%
Outstanding balances			$ 0			$ 0
364-Day Term Loan | Line of Credit
Debt Instrument [Line Items]
Aggregate principal amount	$ 1,400,000,000
Credit agreement term	364 days
Prepayment rate	20.00%
Senior Notes
Debt Instrument [Line Items]
Aggregate principal amount								$ 3,500,000,000

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Debt - Summary of Debt Issuances (Details) - Senior Notes	Mar. 16, 2020 USD ($)
Debt Instrument [Line Items]
Principal	$ 3,500,000,000
$1,500 Million, 2.40% Debt due March 15, 2030
Debt Instrument [Line Items]
Principal	$ 1,500,000,000
Interest rate	2.40%
Net proceeds	$ 1,491,000,000
$750 Million, 3.20% Debt due March 15, 2040
Debt Instrument [Line Items]
Principal	$ 750,000,000
Interest rate	3.20%
Net proceeds	$ 743,000,000
$1,250 Million, 3.40% Debt due March 15, 2050
Debt Instrument [Line Items]
Principal	$ 1,250,000,000
Interest rate	3.40%
Net proceeds	$ 1,237,000,000

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Insurance and Contractholder Liabilities - Summary of Insurance and Contractholder Liabilities (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019	Dec. 31, 2018
Current
Contractholder deposit funds	$ 627	$ 600
Future policy benefits	528	553
Unearned premiums, current	561	453
Total	7,209	7,010
Insurance and contractholder liabilities classified as held for sale	(2,149)	(2,089)
Total insurance and contractholder liabilities	5,060	4,921
Non-current
Contractholder deposit funds	7,062	7,139
Future policy benefits	9,417	9,281
Unearned premiums	369	360
Total	20,464	20,271
Insurance and contractholder liabilities classified as held for sale	(4,400)	(4,219)
Total insurance and contractholder liabilities	16,064	16,052
Total
Contractholder deposit funds	7,689	7,739
Future policy benefits	9,945	9,834
Unearned premiums	930	813
Total	27,673	27,281
Insurance and contractholder liabilities classified as held for sale	(6,549)	(6,308)
Contractholder deposit funds			$ 7,883
Future policy benefits			9,715
Unearned premiums			776
Total insurance and contractholder liabilities	21,124	20,973	27,048
Unpaid claims classified as liabilities of business held for sale	5,100	4,900
Contractholder deposit funds classified as liabilities of business held for sale	758	717
Future policy benefits classified as liabilities of business held for sale	644	653
Integrated Medical
Current
Unpaid claims and claim expenses	2,942	2,875
Non-current
Unpaid claims and claim expenses	17	17
Total
Unpaid claims and claim expenses	2,959	2,892
Unpaid claims and claim expenses	2,959	2,892	2,881	$ 2,697
Other segments
Current
Unpaid claims and claim expenses	2,551	2,529
Non-current
Unpaid claims and claim expenses	3,599	3,474
Total
Unpaid claims and claim expenses	$ 6,150	$ 6,003
Unpaid claims and claim expenses			$ 5,793

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Insurance and Contractholder Liabilities - Narrative (Details) - Integrated Medical - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Insurance and Contractholder Liabilities [Line Items]
Total of incurred but not reported liabilities plus expected claim development on reported claims, including reported claims in process	$ 2,700	$ 2,700
Favorable (unfavorable) impact of prior year development on shareholders' net income	44	62
Favorable (unfavorable) impact of prior year development on pre-tax income	$ 56	$ 78

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Insurance and Contractholder Liabilities - Integrated Medical - Activity (Details) - Integrated Medical - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward]
Beginning balance	$ 2,892	$ 2,697
Less: Reinsurance and other amounts recoverable	303	264
Beginning balance, net	2,589	2,433
Incurred costs related to:
Current year	12,212	12,120
Prior years	(130)	(149)
Total incurred	12,082	11,971
Paid costs related to:
Current year	9,585	9,629
Prior years	2,284	2,134
Total paid	11,869	11,763
Ending balance, net	2,802	2,641
Add: Reinsurance and other amounts recoverable	157	240
Ending balance	$ 2,959	$ 2,881

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Insurance and Contractholder Liabilities - Variances in Incurred Costs Related to Prior Years' Unpaid Claims and Claims Expenses (Details) - Integrated Medical - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Abstract]
Favorable (unfavorable) variance, amount	$ 130	$ 149
Favorable (unfavorable) variance, percentage	0.50%	0.70%
Actual completion factors
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Abstract]
Favorable (unfavorable) variance, amount	$ 50	$ 91
Favorable (unfavorable) variance, percentage	0.20%	0.40%
Medical cost trend
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Abstract]
Favorable (unfavorable) variance, amount	$ 80	$ 58
Favorable (unfavorable) variance, percentage	0.30%	0.30%

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Insurance and Contractholder Liabilities - Liability Details for Unpaid Claims and Claim Expenses (Details) - USD ($) $ in Millions	Jun. 30, 2020	Jun. 30, 2019
Group Disability and Other and International Markets
Liability for Claims and Claims Adjustment Expense [Line Items]
Unpaid claims and claim expenses	$ 6,150
Unpaid claims and claim expenses		$ 5,793
Group Disability and Other
Liability for Claims and Claims Adjustment Expense [Line Items]
Unpaid claims and claim expenses	5,325
Unpaid claims and claim expenses		5,022
Group Disability and Life
Liability for Claims and Claims Adjustment Expense [Line Items]
Unpaid claims and claim expenses	5,165
Unpaid claims and claim expenses		4,827
Other Operations
Liability for Claims and Claims Adjustment Expense [Line Items]
Unpaid claims and claim expenses	160
Unpaid claims and claim expenses		195
International Markets
Liability for Claims and Claims Adjustment Expense [Line Items]
Unpaid claims and claim expenses	$ 825
Unpaid claims and claim expenses		$ 771

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Insurance and Contractholder Liabilities - Activity in Liabilities for Unpaid Claims and Claim Expenses (Details) - Intenational Markets and Group Disability and Life - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Liability for Claims and Claims Adjustment Expense [Line Items]
Beginning balance	$ 5,816
Beginning balance		$ 5,432
Less: Reinsurance and other amounts recoverable	184
Less: Reinsurance and other amounts recoverable		156
Beginning balance, net	5,632
Beginning balance, net		5,276
Incurred costs related to:
Current year	2,829	2,814
Prior years:
Interest accretion	81	81
All other prior years	(8)	(42)
Total incurred	2,902	2,853
Paid costs related to:
Current year	1,357	1,415
Prior years	1,353	1,275
Total paid	2,710	2,690
Foreign currency	(14)	(16)
Ending balance, net	5,810
Ending balance, net		5,423
Add: Reinsurance and other amounts recoverable	180
Add: Reinsurance and other amounts recoverable		175
Ending balance	$ 5,990
Ending balance		$ 5,598

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Reinsurance - Narrative (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($) reinsurer	Jun. 30, 2019 USD ($)	Jun. 30, 2020 USD ($) reinsurer	Jun. 30, 2019 USD ($)	Jan. 01, 2020 USD ($)	Dec. 31, 2019 USD ($) reinsurer
Effects of Reinsurance [Line Items]
Allowance for credit losses on reinsurance recoverables	$ 34		$ 34
GMIB
Effects of Reinsurance [Line Items]
Percent of future claim payments reinsured	100.00%		100.00%			100.00%
Annuitization election period			30 days
Impact of non-performance risk
GMIB liabilities	$ 838		$ 838			$ 688
Number of external reinsurers | reinsurer	3		3			3
Amounts included in shareholders net income for GMIB assets
Amounts included in shareholders net income for GMIB liabilities
Variable Annuity | Berkshire
Effects of Reinsurance [Line Items]
Percent of future claim payments reinsured	100.00%		100.00%
Remaining overall limit under reinsurance agreement	$ 3,300		$ 3,300
Other Current Assets
Effects of Reinsurance [Line Items]
Reinsurance recoverables	$ 224		$ 224			$ 222
Adjustment upon Adoption
Effects of Reinsurance [Line Items]
Allowance for credit losses on reinsurance recoverables					$ 31

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Reinsurance - Reinsurance Recoverables by Range of External Credit Rating and Collateral Level (Details) $ in Millions	Jun. 30, 2020 USD ($)
Ceded Credit Risk [Line Items]
Reinsurance recoverables	$ 5,373
Allowance for uncollectible reinsurance	(34)
Reinsurance recoverables classified as assets of business held for sale	(173)
Total reinsurance recoverables	5,166
Fair value of collateral contractually required to meet or exceed carrying value of recoverable
Ceded Credit Risk [Line Items]
Reinsurance recoverables	1,319
Collateral provisions exist that may mitigate risk of credit loss
Ceded Credit Risk [Line Items]
Reinsurance recoverables	3,638
No collateral
Ceded Credit Risk [Line Items]
Reinsurance recoverables	416
Ongoing Operations
Ceded Credit Risk [Line Items]
Reinsurance recoverables	503
Ongoing Operations | Upper-medium grade and higher
Ceded Credit Risk [Line Items]
Reinsurance recoverables	317
Ongoing Operations | Lower-medium grade
Ceded Credit Risk [Line Items]
Reinsurance recoverables	66
Ongoing Operations | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	120
Ongoing Operations | Fair value of collateral contractually required to meet or exceed carrying value of recoverable
Ceded Credit Risk [Line Items]
Reinsurance recoverables	89
Ongoing Operations | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Upper-medium grade and higher
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Ongoing Operations | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Lower-medium grade
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Ongoing Operations | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	89
Ongoing Operations | Collateral provisions exist that may mitigate risk of credit loss
Ceded Credit Risk [Line Items]
Reinsurance recoverables	20
Ongoing Operations | Collateral provisions exist that may mitigate risk of credit loss | Upper-medium grade and higher
Ceded Credit Risk [Line Items]
Reinsurance recoverables	6
Ongoing Operations | Collateral provisions exist that may mitigate risk of credit loss | Lower-medium grade
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Ongoing Operations | Collateral provisions exist that may mitigate risk of credit loss | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	14
Ongoing Operations | No collateral
Ceded Credit Risk [Line Items]
Reinsurance recoverables	394
Ongoing Operations | No collateral | Upper-medium grade and higher
Ceded Credit Risk [Line Items]
Reinsurance recoverables	311
Ongoing Operations | No collateral | Lower-medium grade
Ceded Credit Risk [Line Items]
Reinsurance recoverables	66
Ongoing Operations | No collateral | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	17
Acquisition, disposition or runoff activities
Ceded Credit Risk [Line Items]
Reinsurance recoverables	4,870
Acquisition, disposition or runoff activities | Upper-medium grade and higher | Lincoln National Life and Lincoln Life & Annuity of New York
Ceded Credit Risk [Line Items]
Reinsurance recoverables	3,064
Acquisition, disposition or runoff activities | Upper-medium grade and higher | Berkshire
Ceded Credit Risk [Line Items]
Reinsurance recoverables	822
Acquisition, disposition or runoff activities | Upper-medium grade and higher | Prudential Retirement Insurance and Annuity
Ceded Credit Risk [Line Items]
Reinsurance recoverables	660
Acquisition, disposition or runoff activities | Upper-medium grade and higher | Other
Ceded Credit Risk [Line Items]
Reinsurance recoverables	281
Acquisition, disposition or runoff activities | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	43
Acquisition, disposition or runoff activities | Fair value of collateral contractually required to meet or exceed carrying value of recoverable
Ceded Credit Risk [Line Items]
Reinsurance recoverables	1,230
Acquisition, disposition or runoff activities | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Upper-medium grade and higher | Lincoln National Life and Lincoln Life & Annuity of New York
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Acquisition, disposition or runoff activities | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Upper-medium grade and higher | Berkshire
Ceded Credit Risk [Line Items]
Reinsurance recoverables	329
Acquisition, disposition or runoff activities | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Upper-medium grade and higher | Prudential Retirement Insurance and Annuity
Ceded Credit Risk [Line Items]
Reinsurance recoverables	660
Acquisition, disposition or runoff activities | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Upper-medium grade and higher | Other
Ceded Credit Risk [Line Items]
Reinsurance recoverables	241
Acquisition, disposition or runoff activities | Fair value of collateral contractually required to meet or exceed carrying value of recoverable | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Acquisition, disposition or runoff activities | Collateral provisions exist that may mitigate risk of credit loss
Ceded Credit Risk [Line Items]
Reinsurance recoverables	3,618
Acquisition, disposition or runoff activities | Collateral provisions exist that may mitigate risk of credit loss | Upper-medium grade and higher | Lincoln National Life and Lincoln Life & Annuity of New York
Ceded Credit Risk [Line Items]
Reinsurance recoverables	3,064
Acquisition, disposition or runoff activities | Collateral provisions exist that may mitigate risk of credit loss | Upper-medium grade and higher | Berkshire
Ceded Credit Risk [Line Items]
Reinsurance recoverables	493
Acquisition, disposition or runoff activities | Collateral provisions exist that may mitigate risk of credit loss | Upper-medium grade and higher | Prudential Retirement Insurance and Annuity
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Acquisition, disposition or runoff activities | Collateral provisions exist that may mitigate risk of credit loss | Upper-medium grade and higher | Other
Ceded Credit Risk [Line Items]
Reinsurance recoverables	21
Acquisition, disposition or runoff activities | Collateral provisions exist that may mitigate risk of credit loss | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	40
Acquisition, disposition or runoff activities | No collateral
Ceded Credit Risk [Line Items]
Reinsurance recoverables	22
Acquisition, disposition or runoff activities | No collateral | Upper-medium grade and higher | Lincoln National Life and Lincoln Life & Annuity of New York
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Acquisition, disposition or runoff activities | No collateral | Upper-medium grade and higher | Berkshire
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Acquisition, disposition or runoff activities | No collateral | Upper-medium grade and higher | Prudential Retirement Insurance and Annuity
Ceded Credit Risk [Line Items]
Reinsurance recoverables	0
Acquisition, disposition or runoff activities | No collateral | Upper-medium grade and higher | Other
Ceded Credit Risk [Line Items]
Reinsurance recoverables	19
Acquisition, disposition or runoff activities | No collateral | Not rated
Ceded Credit Risk [Line Items]
Reinsurance recoverables	$ 3

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Reinsurance - Effects of Reinsurance (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Reinsurance Disclosures [Abstract]
Total ceded premiums	$ 117	$ 126	$ 245	$ 256
Total reinsurance recoveries	$ 102	$ 53	$ 280	$ 112

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Reinsurance - Account Value, Net Amount at Risk and Contractholders for GMDB Business (Details) - Variable Annuity - GMDB contractholder in Thousands, $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2020 USD ($) contractholder	Dec. 31, 2019 USD ($) contractholder
Net Amount at Risk by Product and Guarantee [Line Items]
Account value	$ 8,424	$ 9,110
Net amount at risk	$ 1,776	$ 1,764
Number of contractholders (estimated) | contractholder	190	200

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Reinsurance - GMIB Reinsurers (Details) - GMIB - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Ceded Credit Risk [Line Items]
GMIB recoverables	$ 871	$ 713
Berkshire
Ceded Credit Risk [Line Items]
GMIB recoverables	$ 404	332
Berkshire | Secured | GMIB Assets
Ceded Credit Risk [Line Items]
Concentration percentage	100.00%
Sun Life Assurance Company of Canada
Ceded Credit Risk [Line Items]
GMIB recoverables	$ 249	202
Liberty Re (Bermuda) Ltd.
Ceded Credit Risk [Line Items]
GMIB recoverables	$ 218	$ 179
Liberty Re (Bermuda) Ltd. | Secured | GMIB Assets
Ceded Credit Risk [Line Items]
Concentration percentage	96.00%

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Investments - Investments by Category (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Current
Investments including assets held for sale	$ 1,502	$ 1,351
Investments classified as assets held for sale	(312)	(414)
Investments per Consolidated Balance Sheets	1,190	937
Long-term
Investments including assets held for sale	29,207	28,837
Investments classified as assets held for sale	(7,869)	(7,295)
Investments per Consolidated Balance Sheets	21,338	21,542
Total
Investments including assets held for sale	30,709	30,188
Investments classified as assets held for sale	(8,181)	(7,709)
Investments per Consolidated Balance Sheets	22,528	22,479
Investments	8,200	7,700
Debt securities
Current
Investments including assets held for sale	1,046	928
Long-term
Investments including assets held for sale	22,628	22,827
Total
Investments including assets held for sale	23,674	23,755
Equity securities
Current
Investments including assets held for sale	0	0
Long-term
Investments including assets held for sale	373	303
Total
Investments including assets held for sale	373	303
Commercial mortgage loans
Current
Investments including assets held for sale	0	0
Long-term
Investments including assets held for sale	1,942	1,947
Total
Investments including assets held for sale	1,942	1,947
Policy loans
Current
Investments including assets held for sale	0	0
Long-term
Investments including assets held for sale	1,364	1,357
Total
Investments including assets held for sale	1,364	1,357
Other long-term investments
Current
Investments including assets held for sale	0	0
Long-term
Investments including assets held for sale	2,900	2,403
Total
Investments including assets held for sale	2,900	2,403
Short-term investments
Current
Investments including assets held for sale	456	423
Long-term
Investments including assets held for sale	0	0
Total
Investments including assets held for sale	$ 456	$ 423

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Investments - Debt Securities by Contractual Maturity Periods (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Amortized Cost
Due in one year or less	$ 1,049
Due after one year through five years	7,298
Due after five years through ten years	8,751
Due after ten years	4,053
Mortgage and other asset-backed securities	475
Amortized Cost	21,626	$ 21,909
Fair Value
Due in one year or less	1,059
Due after one year through five years	7,593
Due after five years through ten years	9,582
Due after ten years	4,969
Mortgage and other asset-backed securities	471
Fair Value	$ 23,674

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Investments - Gross Unrealized Appreciation (Depreciation) on Debt Securities (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 21,626	$ 21,909
Allowance for Credit Loss	(48)	0
Unrealized Appreciation	2,291	1,876
Unrealized Depreciation	(195)	(30)
Fair Value	23,674	23,755
Run-Off Settlement Annuity Business
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	2,209	2,229
Allowance for Credit Loss	(11)	0
Unrealized Appreciation	803	740
Unrealized Depreciation	(25)	(4)
Fair Value	2,976	2,965
Federal government and agency
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	415	498
Allowance for Credit Loss	0	0
Unrealized Appreciation	222	235
Unrealized Depreciation	0	0
Fair Value	637	733
State and local government
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	654	729
Allowance for Credit Loss	0	0
Unrealized Appreciation	85	81
Unrealized Depreciation	(2)	0
Fair Value	737	810
Foreign government
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	2,002	2,027
Allowance for Credit Loss	0	0
Unrealized Appreciation	293	230
Unrealized Depreciation	(9)	(1)
Fair Value	2,286	2,256
Corporate
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	18,080	18,149
Allowance for Credit Loss	(39)	0
Unrealized Appreciation	1,663	1,299
Unrealized Depreciation	(161)	(28)
Fair Value	19,543	19,420
Mortgage and other asset-backed
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	475	506
Allowance for Credit Loss	(9)	0
Unrealized Appreciation	28	31
Unrealized Depreciation	(23)	(1)
Fair Value	$ 471	$ 536

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Investments - Summary of Debt Securities with a Decline in Fair Value (Details) $ in Millions	Jun. 30, 2020 USD ($) position	Dec. 31, 2019 USD ($) position
More than one year
Total Fair Value	$ 2,581	$ 1,513
Total Amortized Cost	2,776	1,543
Total Unrealized Depreciation	$ (195)	$ (30)
Total Number of Issues | position	1,169	833
Investment grade
One year or less
Fair Value	$ 1,337	$ 723
Amortized Cost	1,412	729
Unrealized Depreciation	$ (75)	$ (6)
Number of Issues | position	280	267
More than one year
Fair Value	$ 201	$ 366
Amortized Cost	221	378
Unrealized Depreciation	$ (20)	$ (12)
Number of Issues | position	23	118
Below investment grade
One year or less
Fair Value	$ 968	$ 340
Amortized Cost	1,055	348
Unrealized Depreciation	$ (87)	$ (8)
Number of Issues | position	831	355
More than one year
Fair Value	$ 75	$ 84
Amortized Cost	88	88
Unrealized Depreciation	$ (13)	$ (4)
Number of Issues | position	35	93

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Investments - Roll-Forward of the Allowance for Credit Losses on Debt Securities (Details) - USD ($) $ in Millions	3 Months Ended
	Jun. 30, 2020	Mar. 31, 2020
Debt Securities, Available-for-sale, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 55	$ 0
Additions to allowance for credit losses on securities for which credit losses were not previously recorded	25	55
Reductions for securities sold during the period	(9)
Net reductions to allowance for credit losses on securities that had an allowance recorded in a previous period	(23)
Ending Balance	$ 48	$ 55

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Investments - Equity Security Investments (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Amortized Cost
Equity securities with readily determinable fair values	$ 140	$ 61
Equity securities with no readily determinable fair value	187	183
Hybrid equity securities	58	58
Total	385	302
Carrying Value
Equity securities with readily determinable fair values	134	64
Equity securities with no readily determinable fair value	196	192
Hybrid equity securities	43	47
Total	$ 373	$ 303

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Investments - Narrative (Details) - USD ($) $ in Millions	6 Months Ended		12 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019		Mar. 31, 2020	Jan. 01, 2020	Mar. 31, 2019	Dec. 31, 2018
Schedule of Investments [Line Items]
Impairments of equity securities related to value changes resulting from observable prices
Stockholders' equity	47,371	43,818	45,344		$ 45,086		$ 42,413	$ 41,035
Realized gains (losses) on investments still held at the reporting date
Derivative contract term	3 months
Fair value of collateral posted
Gain (loss) recognized in the income statement
Gain (loss) recognized in other comprehensive income
Gains (losses) reclassified from other comprehensive income into shareholders' net income
Amounts excluded from assessment of hedge effectiveness
Retained Earnings
Schedule of Investments [Line Items]
Stockholders' equity	23,052	$ 17,834	20,162		$ 21,298		$ 16,426	15,088
Adjustment upon Adoption
Schedule of Investments [Line Items]
Stockholders' equity			(30)	[1]				(15)
Allowance for credit losses on financing receivables						$ 7
Adjustment upon Adoption | Retained Earnings
Schedule of Investments [Line Items]
Stockholders' equity			(30)	[1]		(30)		$ (15)
Commercial Portfolio Segment | Real Estate Loan
Schedule of Investments [Line Items]
Allowance for credit losses on financing receivables	8
Current loans	$ 1,942		$ 1,947
Commercial Portfolio Segment | Real Estate Loan | Adjustment upon Adoption | Retained Earnings
Schedule of Investments [Line Items]
Stockholders' equity						$ (7)

[1] See Note 3 for further information about the Company's adoption of new credit loss guidance (ASU 2016-13).

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Investments - Summary of the Credit Risk Profile of the Commercial Mortgage Loan Portfolio (Details) - Real Estate Loan - Commercial Portfolio Segment $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Schedule of Investments [Line Items]
Allowance for credit losses	$ (8)
Allowance for credit losses	$ 1,942	$ 1,947
Weighted Average
Schedule of Investments [Line Items]
Average Debt Service Coverage Ratio	2.01	2.09
Average Loan-to-Value Ratio	60.00%	58.00%
Below 60%
Schedule of Investments [Line Items]
Carrying Value	$ 904	$ 1,136
Below 60% | Weighted Average
Schedule of Investments [Line Items]
Average Debt Service Coverage Ratio	2.18	2.19
60% to 79%
Schedule of Investments [Line Items]
Carrying Value	$ 903	$ 723
60% to 79% | Weighted Average
Schedule of Investments [Line Items]
Average Debt Service Coverage Ratio	1.94	1.98
80% to 100%
Schedule of Investments [Line Items]
Carrying Value	$ 143	$ 88
80% to 100% | Weighted Average
Schedule of Investments [Line Items]
Average Debt Service Coverage Ratio	1.33	1.62

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Investments - Carrying Values of Other Long-Term Investments (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Schedule of Investments [Line Items]
Other long-term investments	$ 2,900	$ 2,403
Real estate investments
Schedule of Investments [Line Items]
Other long-term investments	850	788
Securities partnerships
Schedule of Investments [Line Items]
Other long-term investments	1,525	1,409
Other
Schedule of Investments [Line Items]
Other long-term investments	$ 525	$ 206

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Investments - Short-Term Investments and Cash Equivalents (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Corporate securities
Short Term Investments And Cash Equivalents [Line Items]
Short-term investments and cash equivalents	$ 4,266	$ 1,985
Federal government securities
Short Term Investments And Cash Equivalents [Line Items]
Short-term investments and cash equivalents	482	472
Foreign government securities
Short Term Investments And Cash Equivalents [Line Items]
Short-term investments and cash equivalents	32	65
Money market funds
Short Term Investments And Cash Equivalents [Line Items]
Short-term investments and cash equivalents	$ 814	$ 631

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Investments - Realized Gains and Losses on Investments (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Investments [Abstract]
Net realized investment gains, excluding credit loss expense and asset write-downs	$ 33	$ 25	$ 9	$ 36
Credit loss expense on invested assets	6	0	(49)	0
Other investment asset write-downs	(1)	(2)	(10)	(3)
Net realized investment gains (losses), before income taxes	$ 38	$ 23	$ (50)	$ 33

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Investments - Sales Information for Available-for-Sale Debt Securities (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Financial Position [Abstract]
Proceeds from sales	$ 880	$ 565	$ 1,623	$ 1,651
Gross gains on sales	27	9	66	23
Gross losses on sales	$ (14)	$ (2)	$ (21)	$ (12)

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Investments - Summary of Derivative Instruments Held (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Designated as Hedging Instrument | Fair Value Hedging | Foreign currency swap contracts
Derivative [Line Items]
Notional value	$ 817	$ 817
Designated as Hedging Instrument | Net Investment Hedging | Foreign currency swap contracts
Derivative [Line Items]
Notional value	526	438
Designated as Hedging Instrument | Net Investment Hedging | Foreign currency forward contracts
Derivative [Line Items]
Notional value	606	406
Not Designated as Hedging Instrument | Foreign currency forward contracts
Derivative [Line Items]
Notional value	$ 442	$ 410

XML

Fair Value Measurements - Financial Assets and Financial Liabilities Carried at Fair Value (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Financial assets at fair value:
Debt securities	$ 23,674	$ 23,755
Equity securities	134	64
Financial liabilities at fair value
Unfunded commitments	55
Recurring
Financial assets at fair value:
Debt securities	23,674	23,755
Equity securities	177	111
Short-term investments	456	423
Real estate funds priced at NAV as a practical expedient	168	184
Recurring | Other Derivatives
Financial assets at fair value:
Derivative assets	193	83
Financial liabilities at fair value
Derivative liabilities	15	18
Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring
Financial assets at fair value:
Debt securities	192	197
Equity securities	1	7
Short-term investments	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring | Other Derivatives
Financial assets at fair value:
Derivative assets	0	0
Financial liabilities at fair value
Derivative liabilities	0	0
Significant Other Observable Inputs (Level 2) | Recurring
Financial assets at fair value:
Debt securities	22,653	23,035
Equity securities	145	72
Short-term investments	456	423
Significant Other Observable Inputs (Level 2) | Recurring | Other Derivatives
Financial assets at fair value:
Derivative assets	193	83
Financial liabilities at fair value
Derivative liabilities	15	18
Significant Unobservable Inputs (Level 3) | Recurring
Financial assets at fair value:
Debt securities	829	523
Equity securities	31	32
Short-term investments	0	0
Significant Unobservable Inputs (Level 3) | Recurring | Other Derivatives
Financial assets at fair value:
Derivative assets	0	0
Financial liabilities at fair value
Derivative liabilities	0	0
Federal government and agency
Financial assets at fair value:
Debt securities	637	733
Federal government and agency | Recurring
Financial assets at fair value:
Debt securities	637	733
Federal government and agency | Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring
Financial assets at fair value:
Debt securities	192	197
Federal government and agency | Significant Other Observable Inputs (Level 2) | Recurring
Financial assets at fair value:
Debt securities	445	536
Federal government and agency | Significant Unobservable Inputs (Level 3) | Recurring
Financial assets at fair value:
Debt securities	0	0
State and local government
Financial assets at fair value:
Debt securities	737	810
State and local government | Recurring
Financial assets at fair value:
Debt securities	737	810
State and local government | Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring
Financial assets at fair value:
Debt securities	0	0
State and local government | Significant Other Observable Inputs (Level 2) | Recurring
Financial assets at fair value:
Debt securities	737	810
State and local government | Significant Unobservable Inputs (Level 3) | Recurring
Financial assets at fair value:
Debt securities	0	0
Foreign government
Financial assets at fair value:
Debt securities	2,286	2,256
Foreign government | Recurring
Financial assets at fair value:
Debt securities	2,286	2,256
Foreign government | Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring
Financial assets at fair value:
Debt securities	0	0
Foreign government | Significant Other Observable Inputs (Level 2) | Recurring
Financial assets at fair value:
Debt securities	2,260	2,228
Foreign government | Significant Unobservable Inputs (Level 3) | Recurring
Financial assets at fair value:
Debt securities	26	28
Corporate
Financial assets at fair value:
Debt securities	19,543	19,420
Corporate | Recurring
Financial assets at fair value:
Debt securities	19,543	19,420
Corporate | Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring
Financial assets at fair value:
Debt securities	0	0
Corporate | Significant Other Observable Inputs (Level 2) | Recurring
Financial assets at fair value:
Debt securities	18,889	19,063
Corporate | Significant Unobservable Inputs (Level 3) | Recurring
Financial assets at fair value:
Debt securities	654	357
Mortgage and other asset-backed
Financial assets at fair value:
Debt securities	471	536
Mortgage and other asset-backed | Recurring
Financial assets at fair value:
Debt securities	471	536
Mortgage and other asset-backed | Quoted Prices in Active Markets for Identical Assets (Level 1) | Recurring
Financial assets at fair value:
Debt securities	0	0
Mortgage and other asset-backed | Significant Other Observable Inputs (Level 2) | Recurring
Financial assets at fair value:
Debt securities	322	398
Mortgage and other asset-backed | Significant Unobservable Inputs (Level 3) | Recurring
Financial assets at fair value:
Debt securities	$ 149	$ 138

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Fair Value Measurements - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Percent of debt and equity securities classified in Level 2	95.00%		95.00%
Maximum percentage of investments classified in Level 2 representing foreign bonds priced using unadjusted broker quotes	1.00%		1.00%
Percent of debt and equity securities classified in Level 3	4.00%		4.00%
Realized investment losses on assets measured at fair value under certain conditions, after-tax			$ 0	$ 0
Realized investment losses on equity securities with no readily determinable fair value
Fair value of off-balance-sheet financial assets
Fair value of off-balance-sheet financial liabilities
Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Assets measured at fair value under certain conditions as a percent of total investments	1.00%	1.00%	1.00%	1.00%
Separate Account Assets
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Activity, including transfers in and out of Level 3
Separate Account Assets | Recurring | Securities partnerships
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Expected liquidation period after inception			10 years
Other Derivatives | Significant Other Observable Inputs (Level 2)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Adjustment for credit risk on derivatives assets	0		$ 0		0
Adjustment for credit risk on derivatives liabilities	$ 0		$ 0		$ 0

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Fair Value Measurements - Fair Value and Significant Unobservable Inputs Used in Pricing Debt Securities (Details) - Recurring - Significant Unobservable Inputs (Level 3) $ in Millions	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Debt securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	$ 829	$ 523
Debt securities | Securities Not Priced by the Company
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	2	0
Corporate and government debt securities | Securities Priced by the Company
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	$ 678	$ 385
Corporate and government debt securities | Securities Priced by the Company | Minimum | Liquidity
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0070	0.0070
Corporate and government debt securities | Securities Priced by the Company | Maximum | Liquidity
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.1700	0.0930
Corporate and government debt securities | Securities Priced by the Company | Weighted Average | Liquidity
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0390	0.0280
Mortgage and other asset-backed securities | Securities Priced by the Company
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	$ 149	$ 138
Mortgage and other asset-backed securities | Securities Priced by the Company | Minimum | Liquidity
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0060	0.0060
Mortgage and other asset-backed securities | Securities Priced by the Company | Minimum | Weighting of credit spreads
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0310	0.0240
Mortgage and other asset-backed securities | Securities Priced by the Company | Maximum | Liquidity
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0370	0.0370
Mortgage and other asset-backed securities | Securities Priced by the Company | Maximum | Weighting of credit spreads
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0620	0.0460
Mortgage and other asset-backed securities | Securities Priced by the Company | Weighted Average | Liquidity
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0070	0.0070
Mortgage and other asset-backed securities | Securities Priced by the Company | Weighted Average | Weighting of credit spreads
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Unobservable Adjustment	0.0440	0.0330

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Fair Value Measurements - Changes in Level 3 Financial Assets and Financial Liabilities Carried at Fair Value (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Transfers into/(out of) Level 3
Change in unrealized gains or losses included in other comprehensive income for assets held at the end of the reporting period	$ 12		$ (54)
Debt and Equity Securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance	766	$ 436	555	$ 410
Total gains (losses) included in shareholders’ net income	17	0	5	(1)
Gains (losses) included in other comprehensive income	12	5	(59)	12
Gains (losses) required to adjust future policy benefits for settlement annuities	7	0	(3)	2
Purchases, sales and settlements
Purchases	2	43	64	43
Sales	0	0	(12)	0
Settlements	(5)	(9)	(7)	(10)
Total purchases, sales and settlements	(3)	34	45	33
Transfers into/(out of) Level 3
Transfers into Level 3	179	13	527	33
Transfers out of Level 3	(118)	(57)	(210)	(58)
Total transfers into/(out of) Level 3	61	(44)	317	(25)
Balance	860	431	860	431
Total gains (losses) included in shareholders’ net income attributable to instruments held at the reporting date	$ 16	$ (1)	$ (1)	$ (1)

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Fair Value Measurements - Fair Values of Separate Account Assets (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guaranteed separate accounts	$ 501	$ 490
Non-guaranteed separate accounts, including disposal groups	7,047	7,235
Subtotal	7,548	7,725
Non-guaranteed separate accounts priced at NAV as a practical expedient	727	756
Total	8,275	8,481
Separate account assets of business classified as held for sale	(14)	(16)
Separate account assets per Consolidated Balance Sheets	8,261	8,465
Pension Plan
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Non-guaranteed separate accounts, including disposal groups	3,900	4,000
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guaranteed separate accounts	203	219
Non-guaranteed separate accounts, including disposal groups	1,485	1,450
Subtotal	1,688	1,669
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guaranteed separate accounts	298	271
Non-guaranteed separate accounts, including disposal groups	5,228	5,522
Subtotal	5,526	5,793
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Guaranteed separate accounts	0	0
Non-guaranteed separate accounts, including disposal groups	334	263
Subtotal	334	263
Significant Unobservable Inputs (Level 3) | Pension Plan
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Non-guaranteed separate accounts, including disposal groups	$ 300	$ 200

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Fair Value Measurements - Additional Information on Separate Account Assets Priced at NAV (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	$ 55
Recurring
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	168	$ 184
Separate Account Assets
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	314
Separate Account Assets | Recurring | NAV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	727	756
Securities partnerships | Separate Account Assets
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	314
Securities partnerships | Separate Account Assets | Recurring | NAV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	499	531
Real estate funds | Separate Account Assets
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	$ 0
Real estate funds | Separate Account Assets | Minimum
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Redemption Notice Period	30 days
Real estate funds | Separate Account Assets | Maximum
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Redemption Notice Period	90 days
Real estate funds | Separate Account Assets | Recurring | NAV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 224	220
Hedge funds | Separate Account Assets
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Unfunded Commitments	$ 0
Hedge funds | Separate Account Assets | Minimum
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Redemption Notice Period	30 days
Hedge funds | Separate Account Assets | Maximum
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Redemption Notice Period	90 days
Hedge funds | Separate Account Assets | Recurring | NAV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	$ 4	$ 5

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Fair Value Measurements - Fair Value Disclosures for Financial Instruments Not Carried at Fair Value (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Fair Value | Significant Other Observable Inputs (Level 2)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, including current maturities, excluding finance leases	$ 40,310	$ 39,439
Fair Value | Significant Unobservable Inputs (Level 3)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Commercial mortgage loans	1,990	1,989
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Commercial mortgage loans	1,942	1,947
Long-term debt, including current maturities, excluding finance leases	$ 35,054	$ 36,375

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Variable Interest Entities (Details) $ in Millions	6 Months Ended
	Jun. 30, 2020 USD ($) entity limitedPartnership	Dec. 31, 2019 USD ($) entity
Variable Interest Entity [Line Items]
Long-term investments	$ 21,338	$ 21,542
Variable Interest Entity, Primary Beneficiary
Variable Interest Entity [Line Items]
Number of VIEs | entity
Variable Interest Entity, Not Primary Beneficiary | Securities Limited Partnerships and Real Estate Limited Partnerships
Variable Interest Entity [Line Items]
Maximum exposure to loss related to arrangements with variable interest entity	$ 3,800
Number of limited partnerships defined as variable interest entities | limitedPartnership	150
Long-term investments	$ 1,900
Commitments to contribute additional cash, amount	$ 1,900
Variable Interest Entity, Not Primary Beneficiary | Securities Limited Partnerships and Real Estate Limited Partnerships | Maximum
Variable Interest Entity [Line Items]
Non-controlling interest percentage	15.00%
Variable Interest Entity, Not Primary Beneficiary | Other Asset-Backed and Corporate Securities
Variable Interest Entity [Line Items]
Maximum exposure to loss related to arrangements with variable interest entity	$ 700
Carrying values	700
Variable Interest Entity, Not Primary Beneficiary | Various Other Variable Interest Entities
Variable Interest Entity [Line Items]
Maximum exposure to loss related to arrangements with variable interest entity
Carrying values

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Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance			$ 45,338
Other comprehensive income, net of tax	$ 737	$ 315	147	$ 742
Other comprehensive (loss) attributable to redeemable noncontrolling interest	(2)	(2)	(6)	(4)
Shareholders' other comprehensive income (loss)	739	317	153	746
Ending balance	47,366		47,366
Securities and Derivatives
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	547	460	975	18
Other comprehensive income (loss) before reclassifications, before tax	920	442	340	1,007
Other comprehensive income (loss) before reclassifications, tax	(197)	(94)	(69)	(216)
Other comprehensive income (loss) before reclassifications, after-tax	723	348	271	791
Reclassification adjustment, before tax	(19)	(6)	13	(7)
Reclassification adjustment, tax	5	1	(3)	1
Net amounts reclassified from AOCI to net income	(14)	(5)	10	(6)
Shareholders' other comprehensive income (loss)	709	343	281	785
Ending balance	1,256	803	1,256	803
Translation of foreign currencies
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(446)	(245)	(275)	(221)
Other comprehensive income (loss), before reclassifications, before tax, including temporary equity	65	(42)	(95)	(67)
Other comprehensive income (loss) before reclassifications, tax, including temporary equity	5	0	(10)	(1)
Other comprehensive income, net of tax	70	(42)	(105)	(68)
Other comprehensive (loss) attributable to redeemable noncontrolling interest	(2)	(2)	(6)	(4)
Shareholders' other comprehensive income (loss)	72	(40)	(99)	(64)
Ending balance	(374)	(285)	(374)	(285)
Postretirement benefits liability
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(1,628)	(1,497)	(1,641)	(1,508)
Other comprehensive income (loss) before reclassifications, before tax	(73)	(8)	(73)	(8)
Other comprehensive income (loss) before reclassifications, tax	17	1	17	1
Other comprehensive income (loss) before reclassifications, after-tax	(56)	(7)	(56)	(7)
Reclassification adjustment, tax	(4)	5	(9)	(9)
Net amounts reclassified from AOCI to net income	14	21	27	32
Shareholders' other comprehensive income (loss)	(42)	14	(29)	25
Ending balance	(1,670)	(1,483)	(1,670)	(1,483)
Reclassification adjustment for amortization of net losses from past experience and prior service costs (interest expense and other)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Reclassification adjustment, before tax	18	16	36	31
Reclassification adjustment for settlement (interest expense and other)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Reclassification adjustment, before tax	$ 0	$ 0	$ 0	$ 10

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Organizational Efficiency Plans (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Jun. 30, 2020	Jun. 30, 2019
Restructuring and Related Activities [Abstract]
Charge for organizational efficiency plan, pre-tax	$ 31	$ 207	$ 31	$ 0
Charge for organizational efficiency plan, after-tax	$ 24	$ 162	$ 24	$ 0

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Leases (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Operating leases:
Operating lease ROU assets	$ 544	$ 536
Accrued expenses and other current liabilities	158	166
Other non-current liabilities	482	465
Total operating lease liabilities	640	631
Finance leases:
Property and equipment, gross	98	110
Accumulated depreciation	(35)	(23)
Property and equipment, net	63	87
Short-term debt	22	27
Long-term debt	43	61
Total finance lease liabilities	$ 65	$ 88
Balance sheet location of current operating lease liabilities	ci:AccruedExpensesAndOtherLiabilities
Balance sheet location of non-current operating lease liabilities	us-gaap:OtherLiabilitiesNoncurrent
Balance sheet location of non-current finance lease assets	us-gaap:PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortization
Balance sheet location of current finance lease liabilities	us-gaap:DebtCurrent
Balance sheet location of non-current finance lease liabilities	us-gaap:LongTermDebtAndCapitalLeaseObligations

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Income Taxes (Details)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Income Tax Disclosure [Abstract]
Consolidated effective tax rate	20.00%	21.50%

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Contingencies and Other Matters (Details) - USD ($)	1 Months Ended	6 Months Ended
	Mar. 31, 2016	Jun. 30, 2020	May 07, 2020	Feb. 28, 2017
Commitments And Contingencies [Line Items]
Reserves for litigation matters, pre-tax
Guaranty Fund Assessments
Commitments And Contingencies [Line Items]
Provision for loss contingency
CSR Litigation with the Federal Government | Pending Litigation
Commitments And Contingencies [Line Items]
Damages sought by the complaint			$ 315,000,000
Express Scripts Litigation with Anthem | Pending Litigation | Pricing Concessions Through Remaining Contract Term
Commitments And Contingencies [Line Items]
Damages sought by Anthem	$ 13,000,000,000
Express Scripts Litigation with Anthem | Pending Litigation | Pricing Concessions After Remaining Term of Agreement
Commitments And Contingencies [Line Items]
Damages sought by Anthem	1,800,000,000
Express Scripts Litigation with Anthem | Pending Litigation | Damages for Service Issues
Commitments And Contingencies [Line Items]
Damages sought by Anthem	$ 150,000,000
Positive Outcome of Litigation | Cigna Litigation with Anthem | Pending Litigation
Commitments And Contingencies [Line Items]
Reverse termination fee receivable				$ 1,850,000,000
Collectibility of Risk Corridor Payments | CSR Litigation with the Federal Government | Pending Litigation
Commitments And Contingencies [Line Items]
Damages sought by the complaint			120,000,000
Collectibility of CSRs | CSR Litigation with the Federal Government | Pending Litigation
Commitments And Contingencies [Line Items]
Damages sought by the complaint			$ 195,000,000
Additional Damages Including Lost Premium Value To Shareholders | Cigna Litigation with Anthem | Pending Litigation
Commitments And Contingencies [Line Items]
Damages sought by the complaint				$ 13,000,000,000
Indemnification Agreement
Commitments And Contingencies [Line Items]
Liability for guarantees		0
Retiree and Life Insurance Benefits | Financial Guarantee
Commitments And Contingencies [Line Items]
Maximum guarantee exposure		455,000,000
Assets maintained by employers (minimum)		455,000,000
Liability for guarantees		$ 0

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Segment Information - Summary of Special Items (Details) - USD ($) $ in Millions	3 Months Ended				6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
After-tax
Debt extinguishment costs (Debt extinguishment costs)	$ 11			$ 0	$ 151	$ 0
Integration and transaction-related costs (Selling, general and administrative expenses)	99			115	173	223
Charge for organizational efficiency plan (Selling, general and administrative expenses)		$ 24	$ 162		24	0
Charges associated with litigation matters (Selling, general and administrative expenses)	0			64	19	64
Contractual adjustment for a former client (Pharmacy revenues)					(66)	0
Total impact from special items	110			179	301	287
Before-tax
Debt extinguishment costs (Debt extinguishment costs)	14			0	199	0
Integration and transaction-related costs (Selling, general and administrative expenses)	130			155	227	291
Charge for organizational efficiency plan (Selling, general and administrative expenses)		$ 31	$ 207		31	0
Charges associated with litigation matters (Selling, general and administrative expenses)	0			81	25	81
Contractual adjustment for a former client (Pharmacy revenues)					(87)	0
Total impact from special items	$ 144			$ 236	$ 395	$ 372

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Segment Information - Summarized Segment Financial Information (Details) - USD ($) $ in Millions	3 Months Ended				6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Segment Reporting Information [Line Items]
Revenues from customers	$ 39,042			$ 38,479	$ 77,158	$ 76,079
Net investment income	223			340	576	686
Total revenues	39,265			38,819	77,734	76,765
Revenue contribution from transitioning clients				(4,450)		(8,939)
Net realized investment results from certain equity method investments	(60)			6	(50)	(22)
Special items					(87)
Adjusted revenues	39,205			34,375	77,597	67,804
Income before income taxes	2,289			1,758	3,686	3,546
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients				(655)		(1,315)
(Income) attributable to noncontrolling interests	(8)			(4)	(17)	(9)
Net realized investments (gains) losses	(98)			(17)	0	(55)
Amortization of acquired intangible assets	496			737	994	1,480
Special items
Debt extinguishment costs	14			0	199	0
Integration and transaction-related costs	130			155	227	291
Charge for organizational efficiency plan		$ 31	$ 207		31	0
Charges associated with litigation matters	0			81	25	81
Contractual adjustment for a former client					(87)	0
Pre-tax adjusted income (loss) from operations	2,823			2,055	5,058	4,019
Health Services
Segment Reporting Information [Line Items]
Revenues from customers	27,714			27,337	53,970	53,534
Integrated Medical
Segment Reporting Information [Line Items]
Revenues from customers	8,684			8,668	17,952	17,578
International Markets
Segment Reporting Information [Line Items]
Revenues from customers	1,466			1,343	2,886	2,727
Group Disability and Other
Segment Reporting Information [Line Items]
Revenues from customers	1,178			1,131	2,350	2,240
Operating Segments | Health Services
Segment Reporting Information [Line Items]
Net investment income	3			17	28	32
Total revenues	28,602			27,987	55,857	54,936
Revenue contribution from transitioning clients				(4,450)		(8,939)
Net realized investment results from certain equity method investments	0			0	0	0
Special items					(87)
Adjusted revenues	28,602			23,537	55,770	45,997
Income before income taxes	771			1,108	1,465	2,050
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients				(655)		(1,315)
(Income) attributable to noncontrolling interests	(3)			0	(7)	(1)
Net realized investments (gains) losses	0			0	0	0
Amortization of acquired intangible assets	481			709	960	1,422
Special items
Debt extinguishment costs	0				0
Integration and transaction-related costs	0			0	0	0
Charge for organizational efficiency plan					0
Charges associated with litigation matters				0	0	0
Contractual adjustment for a former client					(87)
Pre-tax adjusted income (loss) from operations	1,249			1,162	2,331	2,156
Operating Segments | Integrated Medical
Segment Reporting Information [Line Items]
Net investment income	49			111	175	234
Total revenues	9,237			8,968	19,097	18,163
Revenue contribution from transitioning clients				0		0
Net realized investment results from certain equity method investments	0			0	0	0
Special items					0
Adjusted revenues	9,237			8,968	19,097	18,163
Income before income taxes	1,543			989	2,683	2,146
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients				0		0
(Income) attributable to noncontrolling interests	0			0	0	0
Net realized investments (gains) losses	(26)			(17)	22	(22)
Amortization of acquired intangible assets	6			18	17	36
Special items
Debt extinguishment costs	0				0
Integration and transaction-related costs	0			0	0	0
Charge for organizational efficiency plan					0
Charges associated with litigation matters				0	0	0
Contractual adjustment for a former client					0
Pre-tax adjusted income (loss) from operations	1,523			990	2,722	2,160
Operating Segments | International Markets
Segment Reporting Information [Line Items]
Net investment income	26			40	66	78
Total revenues	1,492			1,383	2,952	2,805
Revenue contribution from transitioning clients				0		0
Net realized investment results from certain equity method investments	(60)			6	(50)	(22)
Special items					0
Adjusted revenues	1,432			1,389	2,902	2,783
Income before income taxes	390			195	624	417
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients				0		0
(Income) attributable to noncontrolling interests	(5)			(4)	(10)	(8)
Net realized investments (gains) losses	(73)			8	(27)	(15)
Amortization of acquired intangible assets	7			8	14	19
Special items
Debt extinguishment costs	0				0
Integration and transaction-related costs	0			0	0	0
Charge for organizational efficiency plan					0
Charges associated with litigation matters				0	0	0
Contractual adjustment for a former client					0
Pre-tax adjusted income (loss) from operations	319			207	601	413
Operating Segments | Group Disability and Other
Segment Reporting Information [Line Items]
Net investment income	144			171	306	351
Total revenues	1,328			1,309	2,667	2,605
Revenue contribution from transitioning clients				0		0
Net realized investment results from certain equity method investments	0			0	0	0
Special items					0
Adjusted revenues	1,328			1,309	2,667	2,605
Income before income taxes	129			155	201	248
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients				0		0
(Income) attributable to noncontrolling interests	0			0	0	0
Net realized investments (gains) losses	1			(8)	5	(18)
Amortization of acquired intangible assets	2			2	3	3
Special items
Debt extinguishment costs	0				0
Integration and transaction-related costs	0			0	0	0
Charge for organizational efficiency plan					0
Charges associated with litigation matters				0	0	0
Contractual adjustment for a former client					0
Pre-tax adjusted income (loss) from operations	132			149	209	233
Corporate and Eliminations
Segment Reporting Information [Line Items]
Net investment income	1			1	1	(9)
Total revenues	(1,394)			(828)	(2,839)	(1,744)
Revenue contribution from transitioning clients				0		0
Net realized investment results from certain equity method investments	0			0	0	0
Special items					0
Adjusted revenues	(1,394)			(828)	(2,839)	(1,744)
Income before income taxes	(544)			(689)	(1,287)	(1,315)
Special items
Pre-tax adjusted income (loss) from operations	(400)			(453)	(805)	(943)
Corporate
Segment Reporting Information [Line Items]
Revenues from customers	0			0	0	0
Pre-tax adjustments to reconcile to adjusted income from operations
Adjustment for transitioning clients				0		0
(Income) attributable to noncontrolling interests	0			0	0	0
Net realized investments (gains) losses	0			0	0	0
Amortization of acquired intangible assets	0			0	0	0
Special items
Debt extinguishment costs	14				199
Integration and transaction-related costs	130			155	227	291
Charge for organizational efficiency plan					31
Charges associated with litigation matters				81	25	81
Contractual adjustment for a former client					0
Intersegment Eliminations
Segment Reporting Information [Line Items]
Revenues from customers	(1,395)			(829)	(2,840)	(1,735)
Intersegment Eliminations | Health Services
Segment Reporting Information [Line Items]
Revenues from customers	(885)			(633)	(1,859)	(1,370)
Intersegment Eliminations | Integrated Medical
Segment Reporting Information [Line Items]
Revenues from customers	(504)			(189)	(970)	(351)
Intersegment Eliminations | International Markets
Segment Reporting Information [Line Items]
Revenues from customers	0			0	0	0
Intersegment Eliminations | Group Disability and Other
Segment Reporting Information [Line Items]
Revenues from customers	$ (6)			$ (7)	$ (11)	$ (14)

XML

Segment Information - Revenue from External Customers (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenue from External Customer [Line Items]
Premiums	$ 10,406	$ 9,803	$ 21,246	$ 19,774
Total revenues from external customers	39,042	38,479	77,158	76,079
Integrated Medical
Revenue from External Customer [Line Items]
Total revenues from external customers	8,684	8,668	17,952	17,578
International Markets
Revenue from External Customer [Line Items]
Premiums	1,344	1,301	2,719	2,605
Total revenues from external customers	1,466	1,343	2,886	2,727
Pharmacy revenues
Revenue from External Customer [Line Items]
Revenues	26,564	26,288	51,662	51,467
Network revenues
Revenue from External Customer [Line Items]
Revenues	13,090	12,758	25,232	25,031
Home delivery and specialty revenues
Revenue from External Customer [Line Items]
Revenues	12,183	12,272	23,897	24,056
Other
Revenue from External Customer [Line Items]
Revenues	1,291	1,258	2,533	2,380
Integrated Medical premiums | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	7,912	7,396	16,232	14,979
Health Insurance | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	3,090	3,065	6,551	6,104
Stop loss | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	1,152	1,067	2,313	2,136
Other | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	283	241	572	519
Medicare Advantage | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	1,904	1,610	3,785	3,217
Medicare Part D | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	420	400	882	925
Other | Integrated Medical
Revenue from External Customer [Line Items]
Premiums	1,063	1,013	2,129	2,078
Domestic disability, life and accident premiums
Revenue from External Customer [Line Items]
Premiums	1,124	1,069	2,240	2,116
Other premiums
Revenue from External Customer [Line Items]
Premiums	26	37	55	74
Services
Revenue from External Customer [Line Items]
Revenues	2,072	2,388	4,250	4,838
Fees
Revenue from External Customer [Line Items]
Revenues	1,979	2,376	4,133	4,766
Other external revenues
Revenue from External Customer [Line Items]
Revenues	$ 93	$ 12	$ 117	$ 72

XML

Segment Information - Narrative (Details) - USD ($) $ in Billions	Jun. 30, 2020	Dec. 31, 2019
Loss Contingencies [Line Items]
Reserves for performance guarantees
Performance Guarantee | Pharmacy Benefits Management Services
Loss Contingencies [Line Items]
Reserves for performance guarantees	$ 0.9	$ 1.0