10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2017

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 1-5823

CNA FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization) 36-6169860 (I.R.S. Employer Identification No.)

333 S. Wabash Chicago, Illinois (Address of principal executive offices) 60604 (Zip Code)

(312) 822-5000

(Registrant's telephone number, including area code)

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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post 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 the 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 [x] Accelerated filer [ ] Non-accelerated filer [ ](Do not check if a smaller reporting company) 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. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [x]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class	Outstanding at July 27, 2017
Common Stock, Par value $2.50	271,006,887

Item Number		Page Number
	PART I. Financial Information
1.	Condensed Consolidated Financial Statements:
	Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2017 and 2016 (Unaudited)	3
	Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2017 and 2016 (Unaudited)	4
	Condensed Consolidated Balance Sheets as of June 30, 2017 (Unaudited) and December 31, 2016	5
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016 (Unaudited)	6
	Condensed Consolidated Statements of Stockholders' Equity for the six months ended June 30, 2017 and 2016 (Unaudited)	8
	Notes to Condensed Consolidated Financial Statements (Unaudited)	9
2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	44
3.	Quantitative and Qualitative Disclosures About Market Risk	65
4.	Controls and Procedures	65
	PART II. Other Information
1.	Legal Proceedings	66
6.	Exhibits	66

2

PART I. Financial Information

Item 1. Condensed Consolidated Financial Statements

CNA Financial Corporation

Condensed Consolidated Statements of Operations (Unaudited)

Periods ended June 30	Three Months						Six Months
(In millions, except per share data)	2017			2016			2017			2016
Revenues
Net earned premiums	$	1,734		$	1,730		$	3,379		$	3,429
Net investment income	475			502			1,020			937
Net realized investment gains (losses):
Other-than-temporary impairment losses	(2		)	(15		)	(4		)	(38		)
Other net realized investment gains	52			31			90			18
Net realized investment gains (losses)	50			16			86			(20		)
Other revenues	107			100			211			197
Total revenues	2,366			2,348			4,696			4,543
Claims, Benefits and Expenses
Insurance claims and policyholders’ benefits	1,280			1,339			2,573			2,747
Amortization of deferred acquisition costs	312			305			617			612
Other operating expenses	364			378			710			759
Interest	40			38			83			80
Total claims, benefits and expenses	1,996			2,060			3,983			4,198
Income before income tax	370			288			713			345
Income tax expense	(98		)	(79		)	(181		)	(70		)
Net income	$	272		$	209		$	532		$	275
Basic earnings per share	$	1.01		$	0.77		$	1.96		$	1.02
Diluted earnings per share	$	1.00		$	0.77		$	1.96		$	1.02
Dividends declared per share	$	0.25		$	0.25		$	2.50		$	2.50
Weighted Average Outstanding Common Stock and Common Stock Equivalents
Basic	271.1			270.5			271.0			270.4
Diluted	271.9			270.9			271.9			270.9

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements (Unaudited).

3

CNA Financial Corporation

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Periods ended June 30	Three Months					Six Months
(In millions)	2017		2016			2017			2016
Comprehensive Income
Net income	$	272	$	209		$	532		$	275
Other Comprehensive Income, Net of Tax
Changes in:
Net unrealized gains on investments with other-than-temporary impairments	—		(1		)	(4		)	4
Net unrealized gains on other investments	77		310			144			544
Net unrealized gains on investments	77		309			140			548
Foreign currency translation adjustment	42		(48		)	53			(34		)
Pension and postretirement benefits	5		5			12			11
Other comprehensive income, net of tax	124		266			205			525
Total comprehensive income	$	396	$	475		$	737		$	800

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements (Unaudited).

4

CNA Financial Corporation

Condensed Consolidated Balance Sheets

(In millions, except share data)	June 30, 2017 (Unaudited)			December 31, 2016
Assets
Investments:
Fixed maturity securities at fair value (amortized cost of $38,668 and $38,361)	$	41,749		$	40,905
Equity securities at fair value (cost of $108 and $106)	118			110
Limited partnership investments	2,380			2,371
Other invested assets	42			36
Mortgage loans	646			591
Short term investments	1,333			1,407
Total investments	46,268			45,420
Cash	225			271
Reinsurance receivables (less allowance for uncollectible receivables of $38 and $37)	4,426			4,416
Insurance receivables (less allowance for uncollectible receivables of $46 and $46)	2,406			2,209
Accrued investment income	406			405
Deferred acquisition costs	647			600
Deferred income taxes	166			379
Property and equipment at cost (less accumulated depreciation of $263 and $254)	336			310
Goodwill	147			145
Other assets	1,178			1,078
Total assets	$	56,205		$	55,233
Liabilities
Insurance reserves:
Claim and claim adjustment expenses	$	22,179		$	22,343
Unearned premiums	4,107			3,762
Future policy benefits	10,824			10,326
Short term debt	150			—
Long term debt	2,561			2,710
Other liabilities (includes $28and $50 due to Loews Corporation)	4,356			4,123
Total liabilities	44,177			43,264
Commitments and contingencies (Notes C and F)
Stockholders' Equity
Common stock ($2.50 par value; 500,000,000 shares authorized; 273,040,243 shares issued; 270,987,085 and 270,495,998 shares outstanding)	683			683
Additional paid-in capital	2,167			2,173
Retained earnings	9,211			9,359
Accumulated other comprehensive income (loss)	32			(173		)
Treasury stock (2,053,158and 2,544,245 shares), at cost	(65		)	(73		)
Total stockholders’ equity	12,028			11,969
Total liabilities and stockholders' equity	$	56,205		$	55,233

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements (Unaudited).

5

CNA Financial Corporation

Condensed Consolidated Statements of Cash Flows (Unaudited)

Six months ended June 30
(In millions)	2017			2016
Cash Flows from Operating Activities
Net income	$	532		$	275
Adjustments to reconcile net income to net cash flows provided by operating activities:
Deferred income tax expense	122			63
Trading portfolio activity	(11		)	(7		)
Net realized investment (gains) losses	(86		)	20
Equity method investees	42			230
Net amortization of investments	(21		)	(10		)
Depreciation and amortization	43			39
Changes in:
Receivables, net	(195		)	(540		)
Accrued investment income	1			4
Deferred acquisition costs	(41		)	(25		)
Insurance reserves	262			666
Other assets	(118		)	(106		)
Other liabilities	(45		)	(27		)
Other, net	30			31
Total adjustments	(17		)	338
Net cash flows providedby operating activities	515			613
Cash Flows from Investing Activities
Dispositions:
Fixed maturity securities - sales	3,142			3,066
Fixed maturity securities - maturities, calls and redemptions	1,770			1,247
Equity securities	22			72
Limited partnerships	100			124
Mortgage loans	17			109
Purchases:
Fixed maturity securities	(4,840		)	(4,874		)
Equity securities	(8		)	—
Limited partnerships	(47		)	(206		)
Mortgage loans	(72		)	(41		)
Change in other investments	(3		)	11
Change in short term investments	81			281
Purchases of property and equipment	(68		)	(65		)
Disposals of property and equipment	—			107
Other, net	17			2
Net cash flows provided (used) by investing activities	$	111		$	(167	)

6

Six months ended June 30
(In millions)	2017			2016
Cash Flows from Financing Activities
Dividends paid to common stockholders	$	(676	)	$	(677	)
Proceeds from the issuance of debt	—			498
Repayment of debt	—			(358		)
Other, net	(1		)	(1		)
Net cash flows used by financing activities	(677		)	(538		)
Effect of foreign exchange rate changes on cash	5			(6		)
Net change in cash	(46		)	(98		)
Cash, beginning of year	271			387
Cash, end of period	$	225		$	289

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements (Unaudited).

7

CNA Financial Corporation

Condensed Consolidated Statements of Stockholders' Equity (Unaudited)

Six months ended June 30
(In millions)	2017			2016
Common Stock
Balance, beginning of period	$	683		$	683
Balance, end of period	683			683
Additional Paid-in Capital
Balance, beginning of period	2,173			2,153
Stock-based compensation	(6		)	2
Balance, end of period	2,167			2,155
Retained Earnings
Balance, beginning of period	9,359			9,313
Dividends paid to common stockholders	(680		)	(677		)
Net income	532			275
Balance, end of period	9,211			8,911
Accumulated Other Comprehensive Income (Loss)
Balance, beginning of period	(173		)	(315		)
Other comprehensive income	205			525
Balance, end of period	32			210
Treasury Stock
Balance, beginning of period	(73		)	(78		)
Stock-based compensation	8			5
Balance, end of period	(65		)	(73		)
Total stockholders' equity	$	12,028		$	11,886

The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements (Unaudited).

8

CNA Financial Corporation

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note A. General

Basis of Presentation

The Condensed Consolidated Financial Statements include the accounts of CNA Financial Corporation (CNAF) and its subsidiaries. Collectively, CNAF and its subsidiaries are referred to as CNA or the Company. Loews Corporation (Loews) owned approximately 90% of the outstanding common stock of CNAF as of June 30, 2017.

The accompanying Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Intercompany amounts have been eliminated. Certain financial information that is normally included in annual financial statements prepared in accordance with GAAP, including certain financial statement notes, is not required for interim reporting purposes and has been condensed or omitted. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in CNAF's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2016, including the summary of significant accounting policies in Note A. The preparation of Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.

The interim financial data as of June 30, 2017 and for the three and six months ended June 30, 2017 and 2016 is unaudited. However, in the opinion of management, the interim data includes all adjustments, including normal recurring adjustments, necessary for a fair statement of the Company's results for the interim periods. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.

Recently Adopted Accounting Standards Updates (ASU)

In March 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvementsto Employee Share-Based Payment Accounting. The updated accounting guidance simplifies the accounting for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. As of January 1, 2017, the Company adopted the updated accounting guidanceand began recognizing excess tax benefits or deficiencies on vesting or settlement of awards as an income tax benefit or expense within net income, instead of additional paid-in capital as required under previous guidance. The related cash flows are now classified within operating activities. As a result of this change, excess tax benefits are no longer included in assumed proceeds under the treasury stock method of calculating earnings per share. The impact of the accounting change resulted in a decrease of $0 million and $3 million to income tax expense for the three and six months ended June 30, 2017.

9

Accounting Standards Pending Adoption

In May 2014, the FASB issued ASU No. 2014-09, Revenue Recognition (Topic 606): Revenue from Contracts with Customers. The standard excludes from its scope the accounting for insurance contracts, financial instruments, and certain other agreements that are governed under other GAAP guidance. The updated guidance requires an entity to recognize revenue as performance obligations are met, in an amount that reflects the consideration the entity is entitled to receive for the transfer of the promised goods or services. The standard is effective for interim and annual reporting periods beginning after December 15, 2017 and may be applied retrospectively or through a cumulative effect adjustment to retained earnings at the date of adoption. As insurance contracts are out of scope, the Company anticipates the primary change will be to revenue recognition for certain of our warranty products and services. The Company has not made a decision on the method of adoption and is currently evaluating the effect the updated guidance will have on the Company’s financial statements, but we do not currently believe ASU 2014-09 will have a material effect on the Company's results of operations or financial position.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The updated accounting guidance requires changes to the reporting model for financial instruments. The guidance is effective for interim and annual periods beginning after December 15, 2017. The Company expects the primary change to be the requirement for equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. The updated accounting guidance requires lessees to recognize on the balance sheet the assets and liabilities for the rights and obligations created by all leases, including those historically accounted for as operating leases. The guidance is effective for interim and annual periods beginning after December 15, 2018. The Company is currently evaluating the effect the updated guidance will have on the Company's financial statements. It is expected that assets and liabilities will increase based on the present value of remaining lease payments for leases in place at the adoption date; however, this is not expected to be material to the Company's results of operations or financial position.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurementof Credit Losses on Financial Instruments. The updated accounting guidance requires changes to the recognition of credit losses on financial instruments not accounted for at fair value through net income. The guidance is effective for interim and annual periods beginning after December 15, 2019. The Company is currently evaluating the effect the guidance will have on the Company's financial statements, but expects the primary changes to be the use of the expected credit loss model for its mortgage loan portfolio and reinsurance receivables and the presentation of credit losses within the available-for-sale fixed maturities portfolio through an allowance method rather than as a direct write-down. The expected credit loss model will require a financial asset to be presented at the net amount expected to be collected. The allowance method for available-for-sale debt securities will allow the Company to record reversals of credit losses if the estimate of credit losses declines.

In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The updated accounting guidance requires changes to the presentation of the components of net periodic benefit cost on the income statement by requiring service cost to be presented with other employee compensation costs and other components of net periodic pension cost to be presented outside of any subtotal of operating income. The ASU also stipulates that only the service cost component of net benefit cost is eligible for capitalization. The guidance is effective for interim and annual periods beginning after December 15, 2017. The Company is currently evaluating the effect the guidance will have on the Company's financial statements.

10

Note B. Earnings Per Share

Earnings per share is based on the weighted average number of outstanding common shares. Basic earnings (loss) per share excludes the effect of dilutive securities and is computed by dividing Net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.

For the three and six months ended June 30,2017, approximately 847 thousand and 915 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were included in the calculation of diluted earnings per share. For those same periods, less than 1 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were not included in the calculation of diluted earnings per share, because the effect would have been antidilutive.

For the three and six months ended June 30,2016, approximately 409 thousand and 473 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were included in the calculation of diluted earnings per share. For those same periods, approximately 178 thousand and 180 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were not included in the calculation of diluted earnings per share, because the effect would have been antidilutive.

11

Note C. Investments

The significant components of Net investment income are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Fixed maturity securities	$	457		$	449		$	912		$	895
Equity securities	2			4			3			7
Limited partnership investments	16			46			106			32
Mortgage loans	8			13			15			22
Short term investments	3			1			6			4
Trading portfolio	4			4			6			6
Other	—			—			1			—
Gross investment income	490			517			1,049			966
Investment expense	(15		)	(15		)	(29		)	(29		)
Net investment income	$	475		$	502		$	1,020		$	937

Net realized investment gains (losses) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	56		$	40		$	105		$	85
Gross realized losses	(12		)	(24		)	(29		)	(86		)
Net realized investment gains (losses) on fixed maturity securities	44			16			76			(1		)
Equity securities:
Gross realized gains	1			4			1			4
Gross realized losses	(1		)	(1		)	(1		)	(6		)
Net realized investment gains (losses) on equity securities	—			3			—			(2		)
Derivatives	(3		)	(6		)	(2		)	(13		)
Short term investments and other	9			3			12			(4		)
Net realized investment gains (losses)	$	50		$	16		$	86		$	(20	)

Net realized investment losses for the six months ended June 30, 2016 include $8 million related to the first quarter 2016 redemption of the Company's $350 million senior notes due August 2016.

The components of Other-than-temporary impairment (OTTI) losses recognized in earnings by asset type are presented in the following table.

Periods ended June 30	Three Months				Six Months
(In millions)	2017		2016		2017		2016
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	2	$	13	$	4	$	29
Asset-backed:
Residential mortgage-backed	—		1		—		1
Other asset-backed	—		1		—		3
Total asset-backed	—		2		—		4
Total fixed maturity securities available-for-sale	2		15		4		33
Equity securities available-for-sale -- Common stock	—		—		—		5
OTTI losses recognized in earnings	$	2	$	15	$	4	$	38

12

The following tables present a summary of fixed maturity and equity securities.

June 30, 2017	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,823	$	1,589	$	29	$	19,383	$	—
States, municipalities and political subdivisions	12,461		1,380		15		13,826		(13		)
Asset-backed:
Residential mortgage-backed	4,835		124		38		4,921		(27		)
Commercial mortgage-backed	1,907		59		14		1,952		—
Other asset-backed	1,050		16		5		1,061		—
Total asset-backed	7,792		199		57		7,934		(27		)
U.S. Treasury and obligations of government-sponsored enterprises	113		4		2		115		—
Foreign government	438		12		1		449		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,645		3,185		104		41,726		$	(40	)
Total fixed maturity securities trading	23						23
Equity securities available-for-sale:
Common stock	17		5		—		22
Preferred stock	91		6		1		96
Total equity securities available-for-sale	108		11		1		118
Total	$	38,776	$	3,196	$	105	$	41,867

December 31, 2016	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,711	$	1,323	$	76	$	18,958	$	(1	)
States, municipalities and political subdivisions	12,060		1,213		33		13,240		(16		)
Asset-backed:
Residential mortgage-backed	5,004		120		51		5,073		(28		)
Commercial mortgage-backed	2,016		48		24		2,040		—
Other asset-backed	1,022		8		5		1,025		—
Total asset-backed	8,042		176		80		8,138		(28		)
U.S. Treasury and obligations of government-sponsored enterprises	83		10		—		93		—
Foreign government	435		13		3		445		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,349		2,736		192		40,893		$	(45	)
Total fixed maturity securities trading	12						12
Equity securities available-for-sale:
Common stock	13		6		—		19
Preferred stock	93		2		4		91
Total equity securities available-for-sale	106		8		4		110
Total	$	38,467	$	2,744	$	196	$	41,015

13

The net unrealized gains on investments included in the tables above are recorded as a component of Accumulated other comprehensive income (AOCI). When presented in AOCI, these amounts are net of tax and any required Shadow Adjustments. To the extent that unrealized gains on fixed income securities supporting certain products within the Life & Group Non-Core segment would result in a premium deficiency if realized, a related increase in Insurance reserves is recorded, net of tax, as a reduction of net unrealized gains through Other comprehensive income (loss) (Shadow Adjustments). As of June 30, 2017 and December 31, 2016, the net unrealized gains on investments included in AOCI were correspondingly reduced by Shadow Adjustments of $1,221 million and $1,014 million.

14

The following tables present the estimated fair value and gross unrealized losses of fixed maturity and equity securities in a gross unrealized loss position by the length of time in which the securities have continuously been in that position.

	Less than 12 Months				12 Months or Longer				Total
June 30, 2017	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	1,314	$	26	$	52	$	3	$	1,366	$	29
States, municipalities and political subdivisions	742		15		24		—		766		15
Asset-backed:
Residential mortgage-backed	1,722		34		141		4		1,863		38
Commercial mortgage-backed	473		8		125		6		598		14
Other asset-backed	159		4		14		1		173		5
Total asset-backed	2,354		46		280		11		2,634		57
U.S. Treasury and obligations of government-sponsored enterprises	65		2		—		—		65		2
Foreign government	109		1		—		—		109		1
Total fixed maturity securities available-for-sale	4,584		90		356		14		4,940		104
Equity securities available-for-sale:
Common stock	1		—		—		—		1		—
Preferred stock	15		1		—		—		15		1
Total equity securities available-for-sale	16		1		—		—		16		1
Total	$	4,600	$	91	$	356	$	14	$	4,956	$	105

	Less than 12 Months				12 Months or Longer				Total
December 31, 2016	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	2,615	$	61	$	254	$	15	$	2,869	$	76
States, municipalities and political subdivisions	959		32		23		1		982		33
Asset-backed:
Residential mortgage-backed	2,136		44		201		7		2,337		51
Commercial mortgage-backed	756		22		69		2		825		24
Other asset-backed	398		5		24		—		422		5
Total asset-backed	3,290		71		294		9		3,584		80
U.S. Treasury and obligations of government-sponsored enterprises	5		—		—		—		5		—
Foreign government	108		3		—		—		108		3
Total fixed maturity securities available-for-sale	6,977		167		571		25		7,548		192
Equity securities available-for-sale -- Preferred stock	12		—		13		4		25		4
Total	$	6,989	$	167	$	584	$	29	$	7,573	$	196

15

Based on current facts and circumstances, the Company believes the unrealized losses presented in the June 30, 2017 securities in a gross unrealized loss position table above are not indicative of the ultimate collectibility of the current amortized cost of the securities, but rather are attributable to changes in interest rates, credit spreads and other factors. The Company has no current intent to sell securities with unrealized losses, nor is it more likely than not that it will be required to sell prior to recovery of amortized cost; accordingly, the Company has determined that there are no additional OTTI losses to be recorded as of June 30, 2017.

The following table presents the activity related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held as of June 30, 2017 and 2016 for which a portion of an OTTI loss was recognized in Other comprehensive income (loss).

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Beginning balance of credit losses on fixed maturity securities	$	32		$	48		$	36		$	53
Reductions for securities sold during the period	(2		)	(7		)	(6		)	(12		)
Ending balance of credit losses on fixed maturity securities	$	30		$	41		$	30		$	41

Contractual Maturity

The following table presents available-for-sale fixed maturity securities by contractual maturity.

	June 30, 2017				December 31, 2016
(In millions)	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,590	$	1,628	$	1,779	$	1,828
Due after one year through five years	7,732		8,098		7,566		7,955
Due after five years through ten years	15,754		16,404		15,892		16,332
Due after ten years	13,569		15,596		13,112		14,778
Total	$	38,645	$	41,726	$	38,349	$	40,893

Actual maturities may differ from contractual maturities because certain securities may be called or prepaid. Securities not due at a single date are allocated based on weighted average life.

Derivative Financial Instruments

The Company holds an embedded derivative on a funds withheld liability with a notional value of $171 million and $174 million as of June 30, 2017 and December 31, 2016 and a fair value of $(1) million and $3 million as of June 30, 2017 and December 31, 2016. The embedded derivative on the funds withheld liability is accounted for separately and reported with the funds withheld liability in Other liabilities on the Condensed Consolidated Balance Sheets.

Investment Commitments

As of June 30, 2017, the Company had committed approximately $415 million to future capital calls from various third-party limited partnership investments in exchange for an ownership interest in the related partnerships.

As of June 30, 2017, the Company had mortgage loan commitments of $39 million representing signed loan applications received and accepted.

The Company invests in various privately placed debt securities, including bank loans, as part of its overall investment strategy and has committed to additional future purchases, sales and funding. Purchases and sales of privately placed debt securities are recorded once funded. As of June 30, 2017, the Company had commitments to purchase or fund additional amounts of $196 million and sell $165 million under the terms of such securities.

16

Note D. Fair Value

Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1, as these are the most transparent or reliable.

Level 1 - Quoted prices for identical instruments in active markets.

Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.

Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are not observable.

Prices may fall within Level 1, 2 or 3 depending upon the methodology and inputs used to estimate fair value for each specific security. In general, the Company seeks to price securities using third-party pricing services. Securities not priced by pricing services are submitted to independent brokers for valuation and, if those are not available, internally developed pricing models are used to value assets using a methodology and inputs the Company believes market participants would use to value the assets. Prices obtained from third-party pricing services or brokers are not adjusted by the Company.

The Company performs control procedures over information obtained from pricing services and brokers to ensure prices received represent a reasonable estimate of fair value and to confirm representations regarding whether inputs are observable or unobservable. Procedures may include i) the review of pricing service methodologies or broker pricing qualifications, ii) back-testing, where past fair value estimates are compared to actual transactions executed in the market on similar dates, iii) exception reporting, where period-over-period changes in price are reviewed and challenged with the pricing service or broker based on exception criteria, iv) deep dives, where the Company performs an independent analysis of the inputs and assumptions used to price individual securities and v) pricing validation, where prices received are compared to prices independently estimated by the Company.

17

Assets and Liabilities Measured at Fair Value

Assets and liabilities measured at fair value on a recurring basis are presented in the following tables.

June 30, 2017							Total Assets/Liabilities at Fair Value
(In millions)	Level 1		Level 2		Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	—	$	19,306	$	100	$	19,406
States, municipalities and political subdivisions	—		13,825		1		13,826
Asset-backed:
Residential mortgage-backed	—		4,798		123		4,921
Commercial mortgage-backed	—		1,939		13		1,952
Other asset-backed	—		979		82		1,061
Total asset-backed	—		7,716		218		7,934
U.S. Treasury and obligations of government-sponsored enterprises	115		—		—		115
Foreign government	—		449		—		449
Redeemable preferred stock	19		—		—		19
Total fixed maturity securities	134		41,296		319		41,749
Equity securities	99		—		19		118
Other invested assets	—		5		—		5
Short term investments	260		981		—		1,241
Life settlement contracts, included in Other assets	—		—		1		1
Total assets	$	493	$	42,282	$	339	$	43,114
Liabilities
Other liabilities	$	—	$	1	$	—	$	1
Total liabilities	$	—	$	1	$	—	$	1

December 31, 2016								Total Assets/Liabilities at Fair Value
(In millions)	Level 1		Level 2			Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	—	$	18,840		$	130	$	18,970
States, municipalities and political subdivisions	—		13,239			1		13,240
Asset-backed:
Residential mortgage-backed	—		4,944			129		5,073
Commercial mortgage-backed	—		2,027			13		2,040
Other asset-backed	—		968			57		1,025
Total asset-backed	—		7,939			199		8,138
U.S. Treasury and obligations of government-sponsored enterprises	93		—			—		93
Foreign government	—		445			—		445
Redeemable preferred stock	19		—			—		19
Total fixed maturity securities	112		40,463			330		40,905
Equity securities	91		—			19		110
Other invested assets	—		5			—		5
Short term investments	475		853			—		1,328
Life settlement contracts, included in Other assets	—		—			58		58
Total assets	$	678	$	41,321		$	407	$	42,406
Liabilities
Other liabilities	$	—	$	(3	)	$	—	$	(3	)
Total liabilities	$	—	$	(3	)	$	—	$	(3	)

18

The tables below present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

Level 3 (In millions)	Balance as of April 1, 2017		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)		Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2017		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2017 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	121	$	—	$	—	$	—	$	—		$	(11	)	$	—	$	(10	)	$	100	$	—
States, municipalities and political subdivisions	1		—		—		—		—			—			—		—			1		—
Asset-backed:
Residential mortgage-backed	126		1		1		—		—			(5		)	—		—			123		—
Commercial mortgage-backed	13		—		—		—		—			—			—		—			13		—
Other asset-backed	117		—		—		13		—			(2		)	24		(70		)	82		—
Total asset-backed	256		1		1		13		—			(7		)	24		(70		)	218		—
Total fixed maturity securities	378		1		1		13		—			(18		)	24		(80		)	319		—
Equity securities	19		—		1		—		(1		)	—			—		—			19		—
Life settlement contracts	46		—		—		—		(45		)	—			—		—			1		—
Total	$	443	$	1	$	2	$	13	$	(46	)	$	(18	)	$	24	$	(80	)	$	339	$	—

19

Level 3 (In millions)	Balance as of April 1, 2016		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2016		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2016 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	193	$	1	$	3		$	94	$	(20	)	$	(7	)	$	—	$	(22	)	$	242	$	—
States, municipalities and political subdivisions	2		—		—			—		—			—			—		—			2		—
Asset-backed:
Residential mortgage-backed	128		1		(1		)	10		—			(4		)	—		—			134		—
Commercial mortgage-backed	27		—		—			—		—			(9		)	3		(10		)	11		—
Other asset-backed	50		—		2			35		(25		)	(1		)	—		(16		)	45		—
Total asset-backed	205		1		1			45		(25		)	(14		)	3		(26		)	190		—
Total fixed maturity securities	400		2		4			139		(45		)	(21		)	3		(48		)	434		—
Equity securities	19		—		—			—		—			—			—		—			19		—
Life settlement contracts	72		6		—			—		—			(11		)	—		—			67		(3		)
Total	$	491	$	8	$	4		$	139	$	(45	)	$	(32	)	$	3	$	(48	)	$	520	$	(3	)

20

Level 3 (In millions)	Balance as of January 1, 2017		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*			Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)		Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2017		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2017 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	130	$	—		$	1	$	5	$	(1	)	$	(25	)	$	—	$	(10	)	$	100	$	—
States, municipalities and political subdivisions	1		—			—		—		—			—			—		—			1		—
Asset-backed:
Residential mortgage-backed	129		2			3		—		—			(11		)	—		—			123		—
Commercial mortgage-backed	13		—			—		—		—			—			—		—			13		—
Other asset-backed	57		(1		)	—		51		—			(2		)	52		(75		)	82		—
Total asset-backed	199		1			3		51		—			(13		)	52		(75		)	218		—
Total fixed maturity securities	330		1			4		56		(1		)	(38		)	52		(85		)	319		—
Equity securities	19		—			2		1		(3		)	—			—		—			19		—
Derivative financial instruments	—		1			—		—		(1		)	—			—		—			—		—
Life settlement contracts	58		6			—		—		(58		)	(5		)	—		—			1		—
Total	$	407	$	8		$	6	$	57	$	(63	)	$	(43	)	$	52	$	(85	)	$	339	$	—

21

Level 3 (In millions)	Balance as of January 1, 2016		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2016		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2016 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	168	$	—	$	7		$	147	$	(36	)	$	(10	)	$	—	$	(34	)	$	242	$	—
States, municipalities and political subdivisions	2		—		—			—		—			—			—		—			2		—
Asset-backed:
Residential mortgage-backed	134		2		(1		)	10		—			(9		)	—		(2		)	134		—
Commercial mortgage-backed	22		—		—			9		—			(9		)	3		(14		)	11		—
Other asset-backed	53		—		2			35		(25		)	(1		)	2		(21		)	45		—
Total asset-backed	209		2		1			54		(25		)	(19		)	5		(37		)	190		—
Total fixed maturity securities	379		2		8			201		(61		)	(29		)	5		(71		)	434		—
Equity securities	20		—		(1		)	—		—			—			—		—			19		—
Life settlement contracts	74		10		—			—		—			(17		)	—		—			67		(3		)
Total	$	473	$	12	$	7		$	201	$	(61	)	$	(46	)	$	5	$	(71	)	$	520	$	(3	)

22

*Net realized and unrealized gains and losses from Level 3 securities and derivatives are reported in Net income (loss) as follows:

Major Category of Assets and Liabilities	Condensed Consolidated Statements of Operations Line Items
Fixed maturity securities available-for-sale (1)	Net realized investment gains (losses)
Fixed maturity securities trading	Net investment income
Equity securities (1)	Net realized investment gains (losses)
Other invested assets - Derivative financial instruments held in a trading portfolio	Net investment income
Other invested assets - Derivative financial instruments not held in a trading portfolio	Net realized investment gains (losses)
Life settlement contracts	Other revenues
Other liabilities - Derivative financial instruments	Net realized investment gains (losses)

(1) Unrealized gains and losses are reported within AOCI.

Securities may be transferred in or out of levels within the fair value hierarchy based on the availability of observable market information and quoted prices used to determine the fair value of the security. The availability of observable market information and quoted prices varies based on market conditions and trading volume. During the three and six months ended June 30, 2017 and 2016, there were no transfers between Level 1 and Level 2. The Company's policy is to recognize transfers between levels at the beginning of quarterly reporting periods.

Valuation Methodologies and Inputs

The following section describes the valuation methodologies and relevant inputs used to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which the instruments are generally classified.

Fixed Maturity Securities

Level 1 securities include highly liquid and exchange traded bonds and redeemable preferred stock, valued using quoted market prices. Level 2 securities include most other fixed maturity securities as the significant inputs are observable in the marketplace. All classes of Level 2 fixed maturity securities are valued using a methodology based on information generated by market transactions involving identical or comparable assets, a discounted cash flow methodology, or a combination of both when necessary. Common inputs for all classes of fixed maturity securities include prices from recently executed transactions of similar securities, marketplace quotes, benchmark yields, spreads off benchmark yields, interest rates and U.S. Treasury or swap curves. Specifically for asset-backed securities, key inputs include prepayment and default projections based on past performance of the underlying collateral and current market data. Fixed maturity securities are primarily assigned to Level 3 in cases where broker/dealer quotes are significant inputs to the valuation, and there is a lack of transparency as to whether these quotes are based on information that is observable in the marketplace. Level 3 securities also include private placement debt securities whose fair value is determined using internal models with inputs that are not market observable.

Equity Securities

Level 1 equity securities include publicly traded securities valued using quoted market prices. Level 2 securities are primarily non-redeemable preferred stocks and common stocks valued using pricing for similar securities, recently executed transactions and other pricing models utilizing market observable inputs. Level 3 securities are primarily priced using broker/dealer quotes and internal models with inputs that are not market observable.

23

Other Invested Assets

The fair value of Federal Home Loan Bank of Chicago (FHLBC) stock is equal to par because it can only be redeemed by the FHLBC at par or sold to another member of the FHLBC at par and is classified as Level 2.

As of June 30, 2017 and December 31, 2016, there were approximately $37 million and $31 million respectively of overseas deposits within other invested assets, which can be redeemed at net asset value in 90 days or less. Overseas deposits are excluded from the fair value hierarchy, because their fair value is recorded using the net asset value per share (or equivalent) practical expedient.

Short Term Investments

Securities that are actively traded or have quoted prices are classified as Level 1. These securities include money market funds and treasury bills. Level 2 primarily includes commercial paper, for which all inputs are market observable. Fixed maturity securities purchased within one year of maturity are classified consistent with fixed maturity securities discussed above. Short term investments as presented in the tables above differ from the amounts presented on the Condensed Consolidated Balance Sheets because certain short term investments, such as time deposits, are not measured at fair value.

Life Settlement Contracts

The Company accounts for its investment in life settlement contracts using the fair value method. Historically, the fair value of life settlement contracts was determined as the present value of the anticipated death benefits less anticipated premium payments based on contract terms that are distinct for each insured, as well as the Company's own assumptions for mortality, premium expense and the rate of return that a buyer would require on the contracts.

The entire portfolio of life settlement contracts, which is included within the Life and Group Non-Core segment, was determined to be held for sale as of December 31, 2016 as the Company reached an agreement on terms to sell the portfolio. As such, the Company adjusted the fair value to the estimated sales proceeds less cost to sell. The definitive Purchase and Sale Agreement (PSA) related to the portfolio was executed on March 7, 2017 (sale date). In connection therewith, the life settlement contracts and related sale proceeds were placed in escrow until the buyer is recognized as the owner and beneficiary of each individual life settlement contract by the life insurance company that issued the policy. All but $1 million of the contracts have been released from escrow as of June 30, 2017. The Company derecognized the released contracts and recorded the consideration, including a note receivable, which is payable over three years and is carried at amortized cost less any valuation allowance. The note receivable of $45 million is included within Other assets on the June 30, 2017 Condensed Consolidated Balance Sheet and interest income is accreted to the principal balance of the note receivable. The contracts remaining in escrow have not been derecognized, continue to be measured at the fair value per the PSA, and are expected to clear escrow in the third quarter of 2017.

The fair value of the Company's investments in life settlement contracts were $1 million and $58 million as of June 30, 2017 and December 31, 2016, and are included in Other assets on the Condensed Consolidated Balance Sheets. Despite the sale, the contracts have been classified as Level 3 as there is not an active market for life settlement contracts. The cash receipts and payments related to the life settlement contracts prior to the sale date are included in Cash Flows from operating activities on the Condensed Consolidated Statements of Cash Flows. Cash receipts related to the sale of the life settlement contracts, as well as principal payments on the note receivable, are included in Cash Flows from investing activities.

Derivative Financial Investments

Level 2 securities primarily include the embedded derivative on the funds withheld liability. The embedded derivative on funds withheld liability is valued using the change in fair value of the assets supporting the funds withheld liability, which are fixed maturity securities valued with observable inputs.

24

Significant Unobservable Inputs

The following tables present quantitative information about the significant unobservable inputs utilized by the Company in the fair value measurements of Level 3 assets. Valuations for assets and liabilities not presented in the tables below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company. The valuation of life settlement contracts was based on the terms of the sale of the contracts to a third party; therefore, the contracts are not included in the table below.

June 30, 2017	Estimated Fair Value (In millions)		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	125	Discounted cash flow	Credit spread	2% - 40% (4%)

December 31, 2016	Estimated Fair Value (In millions)		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	106	Discounted cash flow	Credit spread	2% - 40% (4%)

For fixed maturity securities, an increase to the credit spread assumptions would result in a lower fair value measurement.

Financial Assets and Liabilities Not Measured at Fair Value

The carrying amount and estimated fair value of the Company's financial assets and liabilities which are not measured at fair value on the Condensed Consolidated Balance Sheets are presented in the following tables.

June 30, 2017	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Assets
Mortgage loans	$	646	$	—	$	—	$	655	$	655
Note receivable	45		—		—		45		45
Liabilities
Short term debt	$	150	$	—	$	154	$	—	$	154
Long term debt	2,561		—		2,819		—		2,819

December 31, 2016	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Assets
Mortgage loans	$	591	$	—	$	—	$	594	$	594
Liabilities
Long term debt	$	2,710	$	—	$	2,952	$	—	$	2,952

The following methods and assumptions were used to estimate the fair value of these financial assets and liabilities.

The fair values of mortgage loans were based on the present value of the expected future cash flows discounted at the current interest rate for origination of similar quality loans, adjusted for specific loan risk.

The fair value of the note receivable was based on the present value of the expected future cash flows discounted at the current interest rate for origination of similar notes, adjusted for specific credit risk.

The Company's senior notes and debentures were valued based on observable market prices. The fair value for other debt was estimated using discounted cash flows based on current incremental borrowing rates for similar borrowing arrangements.

The carrying amounts reported on the Condensed Consolidated Balance Sheets for Cash, Short term investments not carried at fair value, Accrued investment income and certain Other assets and Other liabilities approximate fair value due to the short term nature of these items. These assets and liabilities are not listed in the tables above.

25

Note E. Claim and Claim Adjustment Expense Reserves

The Company's property and casualty insurance claim and claim adjustment expense reserves represent the estimated amounts necessary to resolve all outstanding claims, including incurred but not reported (IBNR) claims as of the reporting date. The Company's reserve projections are based primarily on detailed analysis of the facts in each case, the Company's experience with similar cases and various historical development patterns. Consideration is given to such historical patterns as claim reserving trends and settlement practices, loss payments, pending levels of unpaid claims and product mix, as well as court decisions, economic conditions, including inflation, and public attitudes. All of these factors can affect the estimation of claim and claim adjustment expense reserves.

Establishing claim and claim adjustment expense reserves, including claim and claim adjustment expense reserves for catastrophic events that have occurred, is an estimation process. Many factors can ultimately affect the final settlement of a claim and, therefore, the necessary reserve. Changes in the law, results of litigation, medical costs, the cost of repair materials and labor rates can all affect ultimate claim costs. In addition, time can be a critical part of reserving determinations since the longer the span between the incidence of a loss and the payment or settlement of the claim, the more variable the ultimate settlement amount can be. Accordingly, short-tail claims, such as property damage claims, tend to be more reasonably estimable than long-tail claims, such as workers' compensation, general liability and professional liability claims. Adjustments to prior year reserve estimates, if necessary, are reflected in the results of operations in the period that the need for such adjustments is determined. There can be no assurance that the Company's ultimate cost for insurance losses will not exceed current estimates.

Catastrophes are an inherent risk of the property and casualty insurance business and have contributed to material period-to-period fluctuations in the Company's results of operations and/or equity. The Company reported catastrophe losses, net of reinsurance, of $39 million and $73 million for the three and six months ended June 30, 2017. Catastrophe losses in 2017 resulted primarily from U.S. weather-related events. The Company reported catastrophe losses, net of reinsurance, of $85 million and $121 million for the three and six months ended June 30, 2016. Catastrophe losses in 2016 resulted primarily from U.S. weather-related events and the Fort McMurray wildfires.

26

Liability for Unpaid Claim and Claim Adjustment Expenses Rollforward

The following table presents a reconciliation between beginning and ending claim and claim adjustment expense reserves, including claim and claim adjustment expense reserves of the Life & Group Non-Core segment.

For the six months ended June 30
(In millions)	2017			2016
Reserves, beginning of year:
Gross	$	22,343		$	22,663
Ceded	4,094			4,087
Net reserves, beginning of year	18,249			18,576
Net incurred claim and claim adjustment expenses:
Provision for insured events of current year	2,443			2,583
Decrease in provision for insured events of prior years	(159		)	(198		)
Amortization of discount	93			93
Total net incurred (1)	2,377			2,478
Net payments attributable to:
Current year events	(266		)	(311		)
Prior year events	(2,331		)	(2,185		)
Total net payments	(2,597		)	(2,496		)
Foreign currency translation adjustment and other	70			46
Net reserves, end of period	18,099			18,604
Ceded reserves, end of period	4,080			4,371
Gross reserves, end of period	$	22,179		$	22,975

(1) Total net incurred above does not agree to Insurance claims and policyholders' benefits as reflected on the Condensed Consolidated Statements of Operations due to amounts related to retroactive reinsurance deferred gain accounting, uncollectible reinsurance and loss deductible receivables, and benefit expenses related to future policy benefits, which are not reflected in the table above.

27

Net Prior Year Development

Changes in estimates of claim and allocated claim adjustment expense reserves and premium accruals, net of reinsurance, for prior years are defined as net prior year development. These changes can be favorable or unfavorable. The following tables and discussion present the net prior year development recorded for Specialty, Commercial, International and Corporate & Other Non-Core segments.

Three months ended June 30, 2017
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(23	)	$	(34	)	$	2		$	—	$	(55	)
Pretax (favorable) unfavorable premium development	(5		)	1			(4		)	—		(8		)
Total pretax (favorable) unfavorable net prior year development	$	(28	)	$	(33	)	$	(2	)	$	—	$	(63	)

Three months ended June 30, 2016
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(65	)	$	(18	)	$	(15	)	$	—	$	(98	)
Pretax (favorable) unfavorable premium development	(7		)	(2		)	1			—		(8		)
Total pretax (favorable) unfavorable net prior year development	$	(72	)	$	(20	)	$	(14	)	$	—	$	(106	)

Six months ended June 30, 2017
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(54	)	$	(58	)	$	—		$	—	$	(112	)
Pretax (favorable) unfavorable premium development	(10		)	38			(11		)	—		17
Total pretax (favorable) unfavorable net prior year development	$	(64	)	$	(20	)	$	(11	)	$	—	$	(95	)

Six months ended June 30, 2016
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(99	)	$	(32	)	$	(19	)	$	—	$	(150	)
Pretax (favorable) unfavorable premium development	(18		)	(4		)	—			—		(22		)
Total pretax (favorable) unfavorable net prior year development	$	(117	)	$	(36	)	$	(19	)	$	—	$	(172	)

Premium development can occur in the property and casualty business when there is a change in exposure on auditable policies or when premium accruals differ from processed premium.  Audits on policies usually occur in a period after the expiration date of the policy. See further information on the premium development in the Commercial segment for the three and six months ended June 30, 2017 within Note F.

28

Specialty

The following table presents further detail of the net prior year claim and allocated claim adjustment expense reserve development (development) recorded for the Specialty segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Medical Professional Liability	$	3		$	(23	)	$	4		$	(30	)
Other Professional Liability and Management Liability	(37		)	(41		)	(69		)	(50		)
Surety	—			—			—			—
Warranty	6			3			6			5
Other	5			(4		)	5			(24		)
Total pretax (favorable) unfavorable development	$	(23	)	$	(65	)	$	(54	)	$	(99	)

Three Months

2017

Favorable development in other professional liability and management liability was primarily due to lower than expected claim frequency in accident years 2013 through 2015 and lower than expected severity in accident years 2014 through 2016 for professional liability.

2016

Favorable development in medical professional liability was due to lower than expected severity for individual healthcare professionals and allied facilities for accident years 2014 and prior.

Favorable development in other professional liability and management liability was primarily related to lower than expected frequency of claims in accident years 2010 through 2015, mainly driven by professional services. This was partially offset by unfavorable development in accident year 2015 related to an increase in management liability frequency of larger claims.

Six Months

2017

Favorable development in other professional liability and management liability was primarily due to favorable settlements on closed claims and a lower frequency of large losses for accident years 2011 through 2016 for professional and management liability, lower than expected claim frequency in accident years 2013 through 2015 for professional liability and lower than expected severity in accident years 2014 through 2016 for professional liability.

2016

Favorable development for medical professional liability was primarily due to lower than expected severity for individual healthcare professionals, allied facilities, and hospitals in accident years 2011 and prior. This was partially offset by unfavorable development in accident years 2012 and 2013 related to higher than expected large loss emergence in hospitals and higher than expected severity in accident years 2014 and 2015 in our aging services business.

Favorable development in other professional liability and management liability was primarily related to lower than expected frequency of claims in accident years 2010 through 2015, mainly driven by professional services. Additional favorable development was related to favorable outcomes on larger claims in 2013 and prior in professional services. This was partially offset by unfavorable development in accident years 2014 and 2015 related to an increase in management liability frequency of larger claims.

Favorable development for other coverages was due to better than expected claim frequency in property coverages provided to Specialty customers in accident year 2015.

29

Commercial

The following table presents further detail of the development recorded for the Commercial segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Commercial Auto	$	—		$	(20	)	$	(26	)	$	(35	)
General Liability	(1		)	(37		)	(1		)	(52		)
Workers' Compensation	(46		)	50			(46		)	54
Property and Other	13			(11		)	15			1
Total pretax (favorable) unfavorable development	$	(34	)	$	(18	)	$	(58	)	$	(32	)

Three Months

2017

Favorable development for workers’ compensation was primarily related to decreases in frequency and severity in recent accident years, partially attributable to California reforms related to decreases in medical costs.

Unfavorable development for property and other was primarily due to higher than expected severity in accident year 2016.

2016

Favorable development for commercial auto was primarily due to favorable settlements on claims in accident years 2010 through 2014.

Favorable development for general liability was primarily due to better than expected claim settlements in accident years 2012 through 2014 and better than expected severity on umbrella claims in accident years 2010 through 2013.

Unfavorable development for workers’ compensation was due to a reduction in estimated recoveries on war hazard claims for Defense Base Act contractors, which was partially offset by favorable development related to lower than expected frequencies for our small and middle market businesses in accident years 2009 through 2014.

Favorable development for property and other was primarily due to better than expected loss emergence in accident years 2013 through 2015.

30

Six Months

2017

Favorable development for commercial auto was primarily due to lower than expected severity in accident years 2013 through 2015.

Favorable development for workers’ compensation was primarily related to decreases in frequency and severity in recent accident years, partially attributable to California reforms related to decreases in medical costs.

Unfavorable development for property and other was primarily due to higher than expected severity in accident year 2016.

2016

Favorable development for commercial auto was primarily due to favorable settlements on claims in accident years 2010 through 2014.

Favorable development for general liability was primarily due to better than expected claim settlements in accident years 2012 through 2014 and better than expected severity on umbrella claims in accident years 2010 through 2013.

Unfavorable development for workers’ compensation was due to a reduction in estimated recoveries on war hazard claims for Defense Base Act contractors, which was partially offset by favorable development related to lower than expected frequencies for our small and middle market businesses in accident years 2009 through 2014.

Unfavorable development for property and other was primarily due to higher than expected severity from a 2015 catastrophe event. Favorable development was primarily due to better than expected loss emergence in accident years 2013 through 2015.

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International

The following table presents further detail of the development recorded for the International segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Medical Professional Liability	$	(5	)	$	(1	)	$	(5	)	$	(1	)
Other Professional Liability	10			18			9			17
Liability	(5		)	(19		)	(5		)	(19		)
Property & Marine	(12		)	(3		)	(11		)	(7		)
Other	14			(10		)	12			(9		)
Total pretax (favorable) unfavorable development	$	2		$	(15	)	$	—		$	(19	)

Three Months

2017

Unfavorable development for other professional liability was primarily due to higher than expected severity in accident year 2015 arising from the management liability business. This was partially offset by favorable development in accident years 2014 and prior.

Favorable development for property and marine was due to better than expected frequency in accident years 2014 through 2016.

Unfavorable development for other coverages was primarily due to adverse large claims experience in the Hardy political risks portfolio, relating largely to accident year 2016.

2016

Unfavorable development for other professional liability was primarily due to higher than expected large loss emergence in accident years 2011 through 2015.

Favorable development for liability was primarily due to better than expected severity in accident years 2013 and prior.

Favorable development for other coverages was primarily due to better than expected severity in auto liability in accident years 2011 through 2015.

Six Months

2017

The drivers of development for the six month period were generally consistent with the three month summary above.

2016

Unfavorable development for other professional liability was primarily due to higher than expected large loss emergence in accident years 2011 through 2015.

Favorable development for liability was primarily due to better than expected severity in accident years 2013 and prior.

Favorable development for other coverages was primarily due to better than expected severity in auto liability in accident years 2011 through 2015.

32

Asbestos and Environmental Pollution (A&EP) Reserves

In 2010, Continental Casualty Company (CCC) together with several of the Company’s insurance subsidiaries completed a transaction with National Indemnity Company (NICO), a subsidiary of Berkshire Hathaway Inc., under which substantially all of the Company’s legacy A&EP liabilities were ceded to NICO through a Loss Portfolio Transfer (LPT). At the effective date of the transaction, the Company ceded approximately $1.6 billion of net A&EP claim and allocated claim adjustment expense reserves to NICO under a retroactive reinsurance agreement with an aggregate limit of $4 billion. The $1.6 billion of claim and allocated claim adjustment expense reserves ceded to NICO was net of $1.2 billion of ceded claim and allocated claim adjustment expense reserves under existing third-party reinsurance contracts. The NICO LPT aggregate reinsurance limit also covers credit risk on the existing third-party reinsurance related to these liabilities. The Company paid NICO a reinsurance premium of $2 billion and transferred to NICO billed third-party reinsurance receivables related to A&EP claims with a net book value of $215 million, resulting in total consideration of $2.2 billion.

Subsequent to the effective date of the LPT, the Company recognized adverse prior year development on its A&EP reserves which resulted in additional amounts ceded under the LPT. As a result, the cumulative amounts ceded under the LPT exceeded the $2.2 billion consideration paid, resulting in the NICO LPT moving into a gain position, requiring retroactive reinsurance accounting. Under retroactive reinsurance accounting, this gain is deferred and only recognized in earnings in proportion to actual paid recoveries under the LPT. Over the life of the contract, there is no economic impact as long as any additional losses incurred are within the limit of the LPT. In a period in which the Company recognizes a change in the estimate of A&EP reserves that increases the amounts ceded under the LPT, the proportion of actual paid recoveries to total ceded losses is impacted and the change in the deferred gain is recognized in earnings as if the revised estimate of ceded losses was available at the effective date of the LPT. The effect of the deferred retroactive reinsurance benefit is recorded in Insurance claims and policyholders' benefits in the Condensed Consolidated Statement of Operations.

The following table presents the impact of the Loss Portfolio Transfer on the Condensed Consolidated Statements of Operations.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net A&EP adverse development before consideration of LPT	$	—		$	—		$	60		$	200
Retroactive reinsurance benefit recognized	(3		)	(9		)	(43		)	(82		)
Pretax impact of A&EP reserve development and the LPT	$	(3	)	$	(9	)	$	17		$	118

Based upon the Company's annual A&EP reserve review, net unfavorable prior year development of $60 million and $200 million was recognized before consideration of cessions to the LPT for the six months ended June 30, 2017 and 2016. The 2017 unfavorable development was driven by modestly higher anticipated payouts on claims from known sources of asbestos exposure. The 2016 unfavorable development was driven by an increase in anticipated future expenses associated with determination of coverage, higher anticipated payouts associated with a limited number of historical accounts having significant asbestos exposures and higher than expected severity on pollution claims. While this unfavorable development was ceded to NICO under the LPT, the Company’s Net income in both periods was negatively affected due to the application of retroactive reinsurance accounting.

As of June 30, 2017 and December 31, 2016, the cumulative amounts ceded under the LPT were $2.9 billion and $2.8 billion. The unrecognized deferred retroactive reinsurance benefit was $351 million and $334 million as of June 30, 2017 and December 31, 2016.

NICO established a collateral trust account as security for its obligations to the Company. The fair value of the collateral trust account was $2.8 billion as of June 30, 2017 and December 31, 2016. In addition, Berkshire Hathaway Inc. guaranteed the payment obligations of NICO up to the aggregate reinsurance limit as well as certain of NICO’s performance obligations under the trust agreement. NICO is responsible for claims handling and billing and collection from third-party reinsurers related to the Company’s A&EP claims.

33

Note F. Legal Proceedings and Guarantees

CNA 401(k) Plus Plan Litigation

In September 2016, a class action lawsuit was filed against CCC, Continental Assurance Company (CAC) (a former subsidiary of CCC), CNAF, the Investment Committee of the CNA 401(k) Plus Plan (Plan), The Northern Trust Company and John Does 1-10 (collectively Defendants) related to the Plan. The complaint alleges that Defendants breached fiduciary duties to the Plan and caused prohibited transactions in violation of the Employee Retirement Income Security Act of 1974 when the Plan's Fixed Income Fund’s annuity contract with CAC was canceled. The plaintiff alleges he and a proposed class of Plan participants who had invested in the Fixed Income Fund suffered lower returns in their Plan investments as a consequence of these alleged violations and seeks relief on behalf of the putative class. This litigation is in its early stages, and as of yet no class has been certified. CCC and the other defendants are contesting the case. The parties are scheduled to attend a mediation in September 2017.

Management believes the likelihood of loss is reasonably possible; however, given the status of the litigation, the novel issues raised by the allegations and the uncertainty as to how to assess potential damages, management is currently unable to predict the final outcome. The Plan trustees have provided notice to their fiduciary coverage insurance carriers. Based on management’s current assessment and consideration of available insurance coverage, management does not believe that the ultimate resolution of this matter will have a material impact on the Company’s Condensed Consolidated Financial Statements; however, the timing of recognition of loss, if any, and insurance recovery, if any, may differ.

Small Business Premium Rate Adjustment

In prior quarters the Company identified rating errors related to its multi-peril package product and workers' compensation policies within its Small Business unit, and the Company is in the process of voluntarily issuing premium refunds related to affected policies. After the rating errors were identified written and earned premium have been reported net of any impact from the premium rate adjustments. Premium development recognized as a result of the rating errors was favorable of $1 million and adverse of $37 million for the three and six months ended June 30, 2017, respectively.

The estimated refund liability for the multi-peril product and workers' compensation policies as of June 30, 2017 was $96 million. The Company has reduced pretax operating income by $1 million and $6 million for the three and six months ended June 30, 2017 for interest due to policyholders on the aggregate refund amounts. The amount of the refund and corresponding liability will continue to increase until required changes to the automated rating processes are fully implemented. The required changes were implemented in the second quarter of 2017 for the multi-peril product and are expected to be implemented by the end of the third quarter of 2017 for workers' compensation policies. Any fines or penalties related to the foregoing are reasonably possible, but are not expected to be material to the Company's Condensed Consolidated Financial Statements.

Other Litigation

The Company is a party to other routine litigation incidental to its business, which, based on the facts and circumstances currently known, is not material to the Condensed Consolidated Financial Statements.

34

Guarantees

As of June 30, 2017 and December 31, 2016, the Company had recorded liabilities of approximately $5 million related to guarantee and indemnification agreements. Management believes that it is not likely that any future indemnity claims will be significantly greater than the amounts recorded.

In the course of selling business entities and assets to third parties, the Company agreed to guarantee the performance of certain obligations of previously owned subsidiaries and to indemnify purchasers for losses arising out of breaches of representations and warranties with respect to the business entities or assets sold, including, in certain cases, losses arising from undisclosed liabilities or certain named litigation. Such guarantee and indemnification agreements in effect for sales of business entities, assets and third-party loans may include provisions that survive indefinitely. As of June 30, 2017, the aggregate amount related to quantifiable guarantees was $434 million and the aggregate amount related to quantifiable indemnification agreements was $254 million. In certain cases, should the Company be required to make payments under any such guarantee, it would have the right to seek reimbursement from an affiliate of a previously owned subsidiary.

In addition, the Company has agreed to provide indemnification to third-party purchasers for certain losses associated with sold business entities or assets that are not limited by a contractual monetary amount. As of June 30, 2017, the Company had outstanding unlimited indemnifications in connection with the sales of certain of its business entities or assets that included tax liabilities arising prior to a purchaser's ownership of an entity or asset, defects in title at the time of sale, employee claims arising prior to closing and in some cases losses arising from certain litigation and undisclosed liabilities. Certain provisions of the indemnification agreements survive indefinitely, while others survive until the applicable statutes of limitation expire, or until the agreed-upon contract terms expire.

The Company also provided guarantees, if the primary obligor fails to perform, to holders of structured settlement annuities provided by a previously owned subsidiary. As of June 30, 2017, the potential amount of future payments the Company could be required to pay under these guarantees was approximately $1.8 billion, which will be paid over the lifetime of the annuitants. The Company does not believe any payment is likely under these guarantees, as the Company is the beneficiary of a trust that must be maintained at a level that approximates the discounted reserves for these annuities.

Note G. Benefit Plans

The components of net periodic cost (benefit) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pension cost (benefit)
Interest cost on projected benefit obligation	$	26		$	28		$	52		$	56
Expected return on plan assets	(39		)	(40		)	(78		)	(80		)
Amortization of net actuarial loss	9			10			18			19
Settlement loss	—			—			2			—
Net periodic pension cost (benefit)	$	(4	)	$	(2	)	$	(6	)	$	(5	)

35

Note H. Accumulated Other Comprehensive Income (Loss) by Component

The tables below display the changes in Accumulated other comprehensive income (loss) by component.

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of April 1, 2017	$	26		$	709	$	(640	)	$	(187	)	$	(92	)
Other comprehensive income (loss) before reclassifications	(1		)	108		—			42			149
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $1, $(15), $3, $- and $(11)	(1		)	31		(5		)	—			25
Other comprehensive income (loss) net of tax (expense) benefit of $-, $(48), $(3), $- and $(51)	—			77		5			42			124
Balance as of June 30, 2017	$	26		$	786	$	(635	)	$	(145	)	$	32

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of April 1, 2016	$	32		$	624	$	(642	)	$	(70	)	$	(56	)
Other comprehensive income (loss) before reclassifications	(1		)	323		—			(48		)	274
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $-, $(6), $3, $- and $(3)	—			13		(5		)	—			8
Other comprehensive income (loss) net of tax (expense) benefit of $1, $(157), $(3), $- and $(159)	(1		)	310		5			(48		)	266
Balance as of June 30, 2016	$	31		$	934	$	(637	)	$	(118	)	$	210

36

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of January 1, 2017	$	30		$	642	$	(647	)	$	(198	)	$	(173	)
Other comprehensive income (loss) before reclassifications	(1		)	193		—			53			245
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $(1), $(24), $7, $- and $(18)	3			49		(12		)	—			40
Other comprehensive income (loss) net of tax (expense) benefit of $1, $(86), $(7), $- and $(92)	(4		)	144		12			53			205
Balance as of June 30, 2017	$	26		$	786	$	(635	)	$	(145	)	$	32

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of January 1, 2016	$	27		$	390	$	(648	)	$	(84	)	$	(315	)
Other comprehensive income (loss) before reclassifications	2			546		—			(34		)	514
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $1, $1, $6, $- and $8	(2		)	2		(11		)	—			(11		)
Other comprehensive income (loss) net of tax (expense) benefit of $(2), $(273), $(6), $- and $(281)	4			544		11			(34		)	525
Balance as of June 30, 2016	$	31		$	934	$	(637	)	$	(118	)	$	210

Amounts reclassified from Accumulated other comprehensive income (loss) shown above are reported in Net income (loss) as follows:

Component of AOCI	Condensed Consolidated Statements of Operations Line Item Affected by Reclassifications
Net unrealized gains (losses) on investments with OTTI losses	Net realized investment gains (losses)
Net unrealized gains (losses) on other investments	Net realized investment gains (losses)
Pension and postretirement benefits	Other operating expenses

37

Note I. Business Segments

The Company's core property and casualty commercial insurance operations are managed and reported in three business segments: Specialty, Commercial and International. The Company's non-core operations are managed and reported in two segments: Life & Group Non-Core and Corporate & Other Non-Core.

The accounting policies of the segments are the same as those described in Note A to the Consolidated Financial Statements within CNAF's Annual Report on Form 10-K for the year ended December 31, 2016. The Company manages most of its assets on a legal entity basis, while segment operations are generally conducted across legal entities. As such, only Insurance and Reinsurance receivables, Insurance reserves, Deferred acquisition costs and Goodwill are readily identifiable for all individual segments. Distinct investment portfolios are not maintained for every individual segment; accordingly, allocation of assets to each segment is not performed. Therefore, a significant portion of Net investment income and Realized investment gains or losses are allocated primarily based on each segment's net carried insurance reserves, as adjusted. All significant intersegment income and expense has been eliminated. Income taxes have been allocated on the basis of the taxable income of the segments.

In the following tables, certain financial measures are presented to provide information used by management to monitor the Company's operating performance. Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio. Net operating income (loss), which is derived from certain income statement amounts, is used by management to monitor performance of the Company's insurance operations. The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk. Based on such analyses, the Company may recognize an OTTI loss on an investment security in accordance with its policy, or sell a security, which may produce realized gains and losses.

Net operating income (loss) is calculated by excluding from net income (loss) the after-tax effects of i) net realized investment gains (losses) ii) income or loss from discontinued operations and iii) any cumulative effects of changes in accounting guidance. The calculation of net operating income excludes net realized investment gains (losses) because net realized investment gains (losses) are largely discretionary, except for some losses related to OTTI, and are generally driven by economic factors that are not necessarily consistent with key drivers of underwriting performance, and are therefore not considered an indication of trends in insurance operations.

38

The Company's results of operations and selected balance sheet items by segment are presented in the following tables.

Three months ended June 30, 2017	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	689		$	705		$	206		$	135		$	—		$	(1	)	$	1,734
Net investment income	120			143			13			195			4			—			475
Other revenues	98			9			(1		)	—			1			—			107
Total operating revenues	907			857			218			330			5			(1		)	2,316
Claims, Benefits and Expenses
Net incurred claims and benefits	398			422			129			328			(2		)	—			1,275
Policyholders’ dividends	1			4			—			—			—			—			5
Amortization of deferred acquisition costs	149			118			45			—			—			—			312
Other insurance related expenses	72			128			31			32			(1		)	(1		)	261
Other expenses	82			11			(1		)	1			50			—			143
Total claims, benefits and expenses	702			683			204			361			47			(1		)	1,996
Operating income (loss) before income tax	205			174			14			(31		)	(42		)	—			320
Income tax (expense) benefit on operating income (loss)	(69		)	(59		)	(4		)	36			15			—			(81		)
Net operating income (loss)	136			115			10			5			(27		)	—			239
Net realized investment gains (losses)	14			19			7			7			3			—			50
Income tax (expense) benefit on net realized investment gains (losses)	(5		)	(6		)	(1		)	(3		)	(2		)	—			(17		)
Net realized investment gains (losses), after tax	9			13			6			4			1			—			33
Net income (loss)	$	145		$	128		$	16		$	9		$	(26	)	$	—		$	272

39

Three months ended June 30, 2016	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	702		$	696		$	197		$	136		$	—		$	(1	)	$	1,730
Net investment income	133			164			13			188			4			—			502
Other revenues	89			8			—			3			—			—			100
Total operating revenues	924			868			210			327			4			(1		)	2,332
Claims, Benefits and Expenses
Net incurred claims and benefits	377			469			157			340			(8		)	—			1,335
Policyholders’ dividends	1			3			—			—			—			—			4
Amortization of deferred acquisition costs	148			117			40			—			—			—			305
Other insurance related expenses	73			130			37			31			—			(1		)	270
Other expenses	79			11			7			2			47			—			146
Total claims, benefits and expenses	678			730			241			373			39			(1		)	2,060
Operating income (loss) before income tax	246			138			(31		)	(46		)	(35		)	—			272
Income tax (expense) benefit on operating income (loss)	(82		)	(46		)	4			42			11			—			(71		)
Net operating income (loss)	164			92			(27		)	(4		)	(24		)	—			201
Net realized investment gains (losses)	4			8			4			(2		)	2			—			16
Income tax (expense) benefit on net realized investment gains (losses)	(2		)	(3		)	(1		)	(3		)	1			—			(8		)
Net realized investment gains (losses), after tax	2			5			3			(5		)	3			—			8
Net income (loss)	$	166		$	97		$	(24	)	$	(9	)	$	(21	)	$	—		$	209

40

Six months ended June 30, 2017	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,353		$	1,356		$	403		$	268		$	—		$	(1	)	$	3,379
Net investment income	273			321			25			392			9			—			1,020
Other revenues	192			18			(1		)	1			1			—			211
Total operating revenues	1,818			1,695			427			661			10			(1		)	4,610
Claims, Benefits and Expenses
Net incurred claims and benefits	784			859			244			658			19			—			2,564
Policyholders’ dividends	2			7			—			—			—			—			9
Amortization of deferred acquisition costs	292			234			91			—			—			—			617
Other insurance related expenses	141			254			58			64			(1		)	(1		)	515
Other expenses	163			25			(7		)	3			94			—			278
Total claims, benefits and expenses	1,382			1,379			386			725			112			(1		)	3,983
Operating income (loss) before income tax	436			316			41			(64		)	(102		)	—			627
Income tax (expense) benefit on operating income (loss)	(146		)	(107		)	(11		)	73			38			—			(153		)
Net operating income (loss)	290			209			30			9			(64		)	—			474
Net realized investment gains (losses)	21			30			13			17			5			—			86
Income tax (expense) benefit on net realized investment gains (losses)	(8		)	(9		)	(2		)	(7		)	(2		)	—			(28		)
Net realized investment gains (losses), after tax	13			21			11			10			3			—			58
Net income (loss)	$	303		$	230		$	41		$	19		$	(61	)	$	—		$	532

June 30, 2017
(In millions)
Reinsurance receivables	$	880	$	591	$	150	$	461	$	2,382	$	—		$	4,464
Insurance receivables	1,020		1,129		290		11		2		—			2,452
Deferred acquisition costs	318		234		95		—		—		—			647
Goodwill	117		—		30		—		—		—			147
Insurance reserves
Claim and claim adjustment expenses	6,229		8,586		1,442		3,417		2,505		—			22,179
Unearned premiums	1,988		1,481		500		139		—		(1		)	4,107
Future policy benefits	—		—		—		10,824		—		—			10,824

41

Six months ended June 30, 2016	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,384		$	1,384		$	395		$	267		$	—		$	(1	)	$	3,429
Net investment income	240			290			25			375			7			—			937
Other revenues	176			14			1			3			3			—			197
Total operating revenues	1,800			1,688			421			645			10			(1		)	4,563
Claims, Benefits and Expenses
Net incurred claims and benefits	767			911			278			663			120			—			2,739
Policyholders’ dividends	2			6			—			—			—			—			8
Amortization of deferred acquisition costs	292			233			87			—			—			—			612
Other insurance related expenses	148			271			65			64			—			(1		)	547
Other expenses	154			16			16			5			101			—			292
Total claims, benefits and expenses	1,363			1,437			446			732			221			(1		)	4,198
Operating income (loss) before income tax	437			251			(25		)	(87		)	(211		)	—			365
Income tax (expense) benefit on operating income (loss)	(146		)	(85		)	4			81			73			—			(73		)
Net operating income (loss)	291			166			(21		)	(6		)	(138		)	—			292
Net realized investment gains (losses)	(7		)	(10		)	8			(5		)	(6		)	—			(20		)
Income tax (expense) benefit on net realized investment gains (losses)	2			3			(2		)	(3		)	3			—			3
Net realized investment gains (losses), after tax	(5		)	(7		)	6			(8		)	(3		)	—			(17		)
Net income (loss)	$	286		$	159		$	(15	)	$	(14	)	$	(141	)	$	—		$	275

December 31, 2016
(In millions)
Reinsurance receivables	$	760	$	621	$	131	$	462	$	2,479	$	—	$	4,453
Insurance receivables	982		1,021		233		17		2		—		2,255
Deferred acquisition costs	310		214		76		—		—		—		600
Goodwill	117		—		28		—		—		—		145
Insurance reserves
Claim and claim adjustment expenses	6,149		8,894		1,328		3,358		2,614		—		22,343
Unearned premiums	1,911		1,323		396		132		—		—		3,762
Future policy benefits	—		—		—		10,326		—		—		10,326

42

The following table presents revenue by line of business for each reportable segment. Revenues are comprised of operating revenues and net realized investment gains and losses.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Specialty
Management & Professional Liability	$	646		$	659		$	1,307		$	1,277
Surety	137			133			260			260
Warranty & Alternative Risks	138			136			272			256
Specialty revenues	921			928			1,839			1,793
Commercial
Middle Market	462			434			920			835
Small Business	129			151			226			294
Other Commercial Insurance	285			291			579			549
Commercial revenues	876			876			1,725			1,678
International
Canada	53			51			104			101
CNA Europe	79			81			152			159
Hardy	93			82			184			169
International revenues	225			214			440			429
Life & Group Non-Core revenues	337			325			678			640
Corporate & Other Non-Core revenues	8			6			15			4
Eliminations	(1		)	(1		)	(1		)	(1		)
Total revenues	$	2,366		$	2,348		$	4,696		$	4,543

43

Item 2. Management's Discussion and Analysis (MD&A) of Financial Condition and Results of Operations

OVERVIEW

The following discussion highlights significant factors affecting the Company. References to “we,” “our,” “us” or like terms refer to the business of CNA. Based on 2015 statutory net written premiums, we are the eighth largest commercial insurance writer and the 14^th largest property and casualty insurance organization in the United States of America.

The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements included under Part I, Item 1 of this Form 10-Q and Item 1A Risk Factors and Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations, which are included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2016.

We utilize the net operating income (loss) financial measure to monitor our operations. Net operating income (loss) is calculated by excluding from net income (loss) the after-tax effects of i) net realized investment gains or losses, ii) income or loss from discontinued operations and iii) any cumulative effects of changes in accounting guidance. The calculation of net operating income excludes net realized investment gains or losses because net realized investment gains or losses are largely discretionary, except for some losses related to OTTI, and are generally driven by economic factors that are not necessarily consistent with key drivers of underwriting performance, and are therefore not considered an indication of trends in insurance operations. Management monitors net operating income (loss) for each business segment to assess segment performance. Presentation of consolidated net operating income (loss) is deemed to be a non-GAAP financial measure. See further discussion regarding how we manage our business in Note I to the Condensed Consolidated Financial Statements included under Part I, Item 1. For reconciliations of non-GAAP measures to the most comparable GAAP measures and other information, please refer herein and/or to CNA's most recent 10-K on file with the Securities and Exchange Commission.

In evaluating the results of our core Specialty, Commercial and International segments, we utilize the loss ratio, the expense ratio, the dividend ratio and the combined ratio. These ratios are calculated using GAAP financial results. The loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums. The expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums. The dividend ratio is the ratio of policyholders' dividends incurred to net earned premiums. The combined ratio is the sum of the loss, expense and dividend ratios. In addition we also utilize renewal premium change, rate, retention and new business in evaluating operating trends. Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes. Rate represents the average change in price on policies that renew excluding exposure change. Exposure represents the measure of risk used in the pricing of the insurance product. Retention represents the percentage of premium dollars renewed in comparison to the expiring premium dollars from policies available to renew. Rate, renewal premium change and retention presented for the prior year is updated to reflect subsequent activity on policies written in the period. New business represents premiums from policies written with new customers and additional policies written with existing customers.

Changes in estimates of claim and allocated claim adjustment expense reserves and premium accruals, net of reinsurance, for prior years are defined as net prior year development within this MD&A. These changes can be favorable or unfavorable. Net prior year development does not include the effect of related acquisition expenses. Further information on our reserves is provided in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

44

CRITICAL ACCOUNTING ESTIMATES

The preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the amounts of revenues and expenses reported during the period. Actual results may differ from those estimates.

Our Condensed Consolidated Financial Statements and accompanying notes have been prepared in accordance with GAAP applied on a consistent basis. We continually evaluate the accounting policies and estimates used to prepare the Condensed Consolidated Financial Statements. In general, our estimates are based on historical experience, evaluation of current trends, information from third-party professionals and various other assumptions that are believed to be reasonable under the known facts and circumstances.

The accounting estimates below are considered by us to be critical to an understanding of our Condensed Consolidated Financial Statements as their application places the most significant demands on our judgment:

• Insurance Reserves

• Reinsurance and Insurance Receivables

• Valuation of Investments and Impairment of Securities

• Long Term Care Policies

• Pension and Postretirement Benefit Obligations

• Income Taxes

Due to the inherent uncertainties involved with these types of judgments, actual results could differ significantly from estimates and may have a material adverse impact on our results of operations, equity, business and insurer financial strength and corporate debt ratings. See the Critical Accounting Estimates section of our Management's Discussion and Analysis of Financial Condition and Results of Operations included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2016 for further information.

45

CONSOLIDATED OPERATIONS

The following table includes the consolidated results of our operations. For more detailed components of our business operations and the net operating income financial measure, see the segment discussions within this MD&A. For further discussion of Net investment income and Net realized investment results, see the Investments section of this MD&A.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Operating Revenues
Net earned premiums	$	1,734		$	1,730		$	3,379		$	3,429
Net investment income	475			502			1,020			937
Other revenues	107			100			211			197
Total operating revenues	2,316			2,332			4,610			4,563
Claims, Benefits and Expenses
Net incurred claims and benefits	1,275			1,335			2,564			2,739
Policyholders' dividends	5			4			9			8
Amortization of deferred acquisition costs	312			305			617			612
Other insurance related expenses	261			270			515			547
Other expenses	143			146			278			292
Total claims, benefits and expenses	1,996			2,060			3,983			4,198
Operating income before income tax	320			272			627			365
Income tax expense on operating income	(81		)	(71		)	(153		)	(73		)
Net operating income	239			201			474			292
Net realized investment gains (losses)	50			16			86			(20		)
Income tax (expense) benefit on net realized investment gains (losses)	(17		)	(8		)	(28		)	3
Net realized investment gains (losses), after tax	33			8			58			(17		)
Net income	$	272		$	209		$	532		$	275

Three Month Comparison

Net operating income increased $38 million for the three months ended June 30, 2017 as compared with the same period in 2016. Net operating income increased $32 million for our core segments driven by improved current accident year underwriting results which more than offset lower net investment income. Net operating loss decreased $6 million for our non-core segments. Catastrophe losses were $24 million after tax for the three months ended June 30, 2017 as compared to $58 million after tax for the same period in 2016.

Favorable net prior year development of $63 million and $106 million was recorded in the three months ended June 30, 2017 and 2016 related to our Specialty, Commercial and International segments. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

46

Six Month Comparison

Net operating income increased $182 million for the six months ended June 30, 2017 as compared with the same period in 2016. Net operating income increased $93 million for our core segments primarily due to higher net investment income, improved underwriting results despite less favorable net prior year loss reserve development and the favorable period over period effect of foreign currency exchange gains and losses. Net operating loss decreased $89 million for our non-core segments primarily due to lower adverse prior year reserve development recorded in the six months ended June 30, 2017 as compared to the same period in 2016 under the A&EP Loss Portfolio Transfer. Catastrophe losses were $48 million after tax for the six months ended June 30, 2017 as compared to $82 million after tax for the same period in 2016.

Favorable net prior year development of $95 million and $172 million was recorded in the six months ended June 30, 2017 and 2016 related to our Specialty, Commercial and International segments. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

47

SEGMENT RESULTS

The following discusses the results for our reporting segments. Our core property and casualty commercial insurance operations are managed and reported in three business segments: Specialty, Commercial and International. Our non-core operations are managed and reported in two segments: Life & Group Non-Core and Corporate & Other Non-Core.

48

Specialty

The following table presents the results of operations.

Periods ended June 30	Three Months						Six Months
(In millions, except ratios, rate and retention)	2017			2016			2017			2016
Net written premiums	$	716		$	691		$	1,395		$	1,375
Net earned premiums	689			702			1,353			1,384
Net investment income	120			133			273			240
Net operating income	136			164			290			291
Net realized investment gains (losses), after tax	9			2			13			(5		)
Net income	145			166			303			286
Other performance metrics:
Loss and loss adjustment expense ratio	57.7		%	53.9		%	57.9		%	55.5		%
Expense ratio	32.0			31.3			32.1			31.7
Dividend ratio	0.2			0.2			0.1			0.2
Combined ratio	89.9		%	85.4		%	90.1		%	87.4		%
Rate	1		%	0		%	1		%	1		%
Renewal premium change	1			1			2			2
Retention	88			88			88			88
New business	$	66		$	61		$	123		$	126

Three Month Comparison

Net written premiums for Specialty increased $25 million for the three months ended June 30, 2017 as compared with the same period in 2016. The renewal premium change was positive and retention remained strong. New business was modestly higher and broad-based. The decrease in net earned premiums was consistent with the trend in net written premiums in recent quarters.

Net operating income decreased $28 million for the three months ended June 30, 2017 as compared with the same period in 2016, primarily due to lower favorable net prior year loss reserve development and lower net investment income.

The combined ratio increased 4.5 points for the three months ended June 30, 2017 as compared with the same period in 2016. The loss ratio increased 3.8 points driven by lower favorable net prior year loss reserve development partially offset by an improved current accident year loss ratio. Catastrophe losses were $5 million, or 0.8 points of the loss ratio, for the three months ended June 30, 2017 as compared to $9 million, or 1.3 points of the loss ratio, for the three months ended June 30, 2016. The expense ratio increased 0.7 points for the three months ended June 30, 2017 as compared with the same period in 2016.

Favorable net prior year development of $28 million and $72 million was recorded in the three months ended June 30, 2017 and 2016. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

49

Six Month Comparison

Net written premiums for Specialty increased $20 million for the six months ended June 30, 2017 as compared with the same period in 2016, driven by positive renewal premium change. The decrease in net earned premiums was consistent with the trend in net written premiums in recent quarters.

Net operating income decreased $1 million for the six months ended June 30, 2017 as compared with the same period in 2016, as lower favorable net prior year loss reserve development was primarily offset by higher net investment income.

The combined ratio increased 2.7 points for the six months ended June 30, 2017 as compared with the same period in 2016. The loss ratio increased 2.4 points driven by lower favorable net prior year loss reserve development partially offset by an improved current accident year loss ratio. Catastrophe losses were $9 million, or 0.7 points of the loss ratio, for the six months ended June 30, 2017 as compared to $13 million, or 1.0 point of the loss ratio, for the six months ended June 30, 2016. The expense ratio increased 0.4 points for the six months ended June 30, 2017 as compared with the same period in 2016.

Favorable net prior year development of $64 million and $117 million was recorded in the six months ended June 30, 2017 and 2016. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

The following table presents the gross and net carried reserves.

(In millions)	June 30, 2017		December 31, 2016
Gross case reserves	$	1,835	$	1,871
Gross IBNR reserves	4,394		4,278
Total gross carried claim and claim adjustment expense reserves	$	6,229	$	6,149
Net case reserves	$	1,676	$	1,681
Net IBNR reserves	3,684		3,723
Total net carried claim and claim adjustment expense reserves	$	5,360	$	5,404

50

Commercial

The following table presents the results of operations.

Periods ended June 30	Three Months						Six Months
(In millions, except ratios, rate and retention)	2017			2016			2017			2016
Net written premiums	$	767		$	740		$	1,482		$	1,488
Net earned premiums	705			696			1,356			1,384
Net investment income	143			164			321			290
Net operating income	115			92			209			166
Net realized investment gains (losses), after tax	13			5			21			(7		)
Net income	128			97			230			159
Other performance metrics:
Loss and loss adjustment expense ratio	60.0		%	67.4		%	63.4		%	65.8		%
Expense ratio	34.5			35.7			35.9			36.5
Dividend ratio	0.6			0.4			0.5			0.4
Combined ratio	95.1		%	103.5		%	99.8		%	102.7		%
Rate	0		%	0		%	0		%	0		%
Renewal premium change	2			2			1			3
Retention	82			84			84			83
New business	$	153		$	146		$	292		$	283

Three Month Comparison

Net written premiums for Commercial increased $27 million for the three months ended June 30, 2017 as compared with the same period in 2016. The increase was driven by higher new business within Middle Markets and positive renewal premium change, offset by slightly lower retention. The increase in net earned premiums was consistent with the trend in net written premiums.

Net operating income increased $23 million for the three months ended June 30, 2017 as compared with the same period in 2016, due to improved underwriting results partially offset by lower net investment income.

The combined ratio improved 8.4 points for the three months ended June 30, 2017 as compared with the same period in 2016. The loss ratio improved 7.4 points due to an improved current accident year loss ratio and higher favorable net prior year loss reserve development. Catastrophe losses were $35 million, or 4.8 points of the loss ratio, for the three months ended June 30, 2017, as compared to $55 million, or 8.0 points of the loss ratio, for the three months ended June 30, 2016. The expense ratio improved 1.2 points for the three months ended June 30, 2017 as compared with the same period in 2016 due to lower employee costs.

Favorable net prior year development of $33 million and $20 million was recorded in the three months ended June 30, 2017 and 2016. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

51

Six Month Comparison

Net written premiums for Commercial decreased $6 million for the six months ended June 30, 2017 as compared with the same period in 2016, due to unfavorable premium development driven by a premium rate adjustment within Small Business more fully discussed in Note F to the Condensed Consolidated Financial Statements under Part I, Item 1. This was mostly offset by higher new business within Middle Markets, positive renewal premium change and higher retention. The decrease in net earned premiums was consistent with the trend in net written premiums.

Net operating income increased $43 million for the six months ended June 30, 2017 as compared with the same period in 2016, due to higher net investment income and improved underwriting results.

The combined ratio improved 2.9 points for the six months ended June 30, 2017 as compared with the same period in 2016, driven by an improved current accident year loss ratio. Catastrophe losses were $62 million, or 4.4 points of the loss ratio, for the six months ended June 30, 2017, as compared to $83 million, or 6.1 points of the loss ratio, for the six months ended June 30, 2016. Excluding the impact of the Small Business premium rate adjustment on the ratios for both periods, the combined ratio decreased 6.6 points, driven by a 4.7 point decrease in the loss ratio primarily due to improved current accident year loss ratio and a 2.0 point decrease in the expense ratio primarily due to lower employee costs.

Favorable net prior year loss reserve development of $58 million and unfavorable premium development of $38 million was recorded for the six months ended June 30, 2017 as compared with favorable net prior year loss reserve development of $32 million and favorable premium development of $4 million for the six months ended June 30, 2016. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

The following table presents the gross and net carried reserves.

(In millions)	June 30, 2017		December 31, 2016
Gross case reserves	$	4,487	$	4,661
Gross IBNR reserves	4,099		4,233
Total gross carried claim and claim adjustment expense reserves	$	8,586	$	8,894
Net case reserves	$	4,206	$	4,353
Net IBNR reserves	3,822		3,952
Total net carried claim and claim adjustment expense reserves	$	8,028	$	8,305

52

International

The following table presents the results of operations.

Periods ended June 30	Three Months						Six Months
(In millions, except ratios, rate and retention)	2017			2016			2017			2016
Net written premiums	$	219		$	194		$	457		$	430
Net earned premiums	206			197			403			395
Net investment income	13			13			25			25
Net operating income (loss)	10			(27		)	30			(21		)
Net realized investment gains, after tax	6			3			11			6
Net income (loss)	16			(24		)	41			(15		)
Other performance metrics:
Loss and loss adjustment expense ratio	62.8		%	79.8		%	60.6		%	70.5		%
Expense ratio	37.3			38.8			37.1			38.3
Combined ratio	100.1		%	118.6		%	97.7		%	108.8		%
Rate	0		%	(2		)%	0		%	(1		)%
Renewal premium change	4			(3		)	2			(2		)
Retention	78			76			78			79
New business	$	73		$	62		$	138		$	122

Three Month Comparison

Net written premiums for International increased $25 million for the three months ended June 30, 2017 as compared with the same period in 2016. The increase was due to higher new business, improved retention and positive renewal premium change. The increase in net earned premiums was consistent with the trend in net written premiums.

Net operating results improved $37 million for the three months ended June 30, 2017 as compared with the same period in 2016, driven by improved underwriting results and the favorable period over period effect of foreign currency exchange gains and losses.

The combined ratio improved 18.5 points for the three months ended June 30, 2017 as compared with the same period in 2016. The loss ratio improved 17.0 points, primarily due to an improved current accident year loss ratio driven by a lower level of large and catastrophe losses, partially offset by lower favorable net prior year loss reserve development. There were no catastrophe losses for the three months ended June 30, 2017as compared to $21 million, or 10.6 points of the loss ratio, for the three months ended June 30, 2016. The expense ratio improved 1.5 points for the three months ended June 30, 2017 as compared with the same period in 2016, primarily due to higher net earned premiums.

Favorable net prior year development of $2 million and $14 million was recorded for the three months ended June 30, 2017 and 2016. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

53

Six Month Comparison

Net written premiums for International increased $27 million for the six months ended June 30, 2017 as compared with the same period in 2016 due to higher new business and positive renewal premium change. The increase in net earned premiums was consistent with the trend in net written premiums.

Net operating results improved $51 million for the six months ended June 30, 2017 as compared with the same period in 2016, driven by improved underwriting results and the favorable period over period effect of foreign currency exchange gains and losses.

The combined ratio improved 11.1 points for the six months ended June 30, 2017 as compared with the same period in 2016. The loss ratio improved 9.9 points, primarily due to an improved current accident year loss ratio driven by a lower level of large and catastrophe losses. Catastrophe losses were $2 million, or 0.6 points of the loss ratio, for the six months ended June 30, 2017as compared to $25 million, or 6.3 points of the loss ratio, for the six months ended June 30, 2016. The expense ratio improved 1.2 points for the six months ended June 30, 2017 as compared with the same period in 2016, primarily due to higher net earned premiums.

Favorable net prior year development of $11 million and $19 million was recorded for the six months ended June 30, 2017 and 2016. Further information on net prior year development is in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

The following table presents the gross and net carried reserves.

(In millions)	June 30, 2017		December 31, 2016
Gross case reserves	$	681	$	632
Gross IBNR reserves	761		696
Total gross carried claim and claim adjustment expense reserves	$	1,442	$	1,328
Net case reserves	$	594	$	548
Net IBNR reserves	706		653
Total net carried claim and claim adjustment expense reserves	$	1,300	$	1,201

54

Life & Group Non-Core

The following table presents the results of operations.

Periods ended June 30	Three Months					Six Months
(In millions)	2017		2016			2017		2016
Net earned premiums	$	135	$	136		$	268	$	267
Net investment income	195		188			392		375
Net operating income (loss)	5		(4		)	9		(6		)
Net realized investment gains (losses), after tax	4		(5		)	10		(8		)
Net income (loss)	9		(9		)	19		(14		)

Three Month Comparison

Net operating results improved $9 million for the three months ended June 30, 2017 as compared with the same period in 2016 driven by improved long term care morbidity.

Six Month Comparison

Net operating results improved $15 million for the six months ended June 30, 2017 as compared with the same period in 2016. The improvement was driven by favorable morbidity partially offset by unfavorable persistency in the long term care business.

55

Corporate & Other Non-Core

The following table presents the results of operations.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net investment income	$	4		$	4		$	9		$	7
Interest expense	39			38			77			80
Net operating loss	(27		)	(24		)	(64		)	(138		)
Net realized investment gains (losses), after tax	1			3			3			(3		)
Net loss	(26		)	(21		)	(61		)	(141		)

Three Month Comparison

Net operating loss increased $3 million for the three months ended June 30, 2017 as compared with the same period in 2016 driven by lower recognition of retroactive reinsurance deferred gain on the Loss Portfolio Transfer due to lower net A&EP claim payments. This is further discussed in Note E to the Condensed Consolidated Financial Statements included under Part I, Item 1.

Six Month Comparison

Net operating loss was $64 million for the six months ended June 30, 2017, an improvement of $74 million as compared with the same period in 2016. This improvement was driven by lower adverse prior year reserve development recorded in 2017 for A&EP under the Loss Portfolio Transfer.

The following table presents the gross and net carried reserves.

(In millions)	June 30, 2017		December 31, 2016
Gross case reserves	$	1,437	$	1,524
Gross IBNR reserves	1,068		1,090
Total gross carried claim and claim adjustment expense reserves	$	2,505	$	2,614
Net case reserves	$	97	$	94
Net IBNR reserves	127		136
Total net carried claim and claim adjustment expense reserves	$	224	$	230

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INVESTMENTS

Net Investment Income

The significant components of Net investment income are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Fixed maturity securities:
Taxable	$	351		$	349		$	698		$	694
Tax-Exempt	106			100			214			201
Total fixed maturity securities	457			449			912			895
Limited partnership investments	16			46			106			32
Other, net of investment expense	2			7			2			10
Net investment income	$	475		$	502		$	1,020		$	937
Net investment income, after tax	$	344		$	362		$	733		$	677
Effective income yield for the fixed maturity securities portfolio, pretax	4.8		%	4.8		%	4.8		%	4.8		%
Effective income yield for the fixed maturity securities portfolio, after tax	3.4		%	3.5		%	3.4		%	3.4		%

Net investment income, after tax, for the three months ended June 30, 2017 decreased $18 million as compared with the same period in 2016. The decrease was driven by limited partnership investments, which returned 0.7% in 2017 as compared with 1.8% in the prior year period. Income from fixed maturity securities, after tax, for the three months ended June 30, 2017 increased $5 million as compared with the same period in 2016, primarily due to an increase in the invested asset base.

Net investment income, after tax, for the six months ended June 30, 2017 increased $56 million as compared with the same period in 2016. The increase was driven by limited partnership investments, which returned 4.5% in 2017 as compared with 1.2% in the prior year period. Income from fixed maturity securities, after tax, for the six months ended June 30, 2017 increased $12 million as compared with the same period in 2016, primarily due to an increase in the invested asset base.

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Net Realized Investment Gains (Losses)

The components of Net realized investment results are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Fixed maturity securities:
Corporate and other bonds	$	39		$	7		$	68		$	(8	)
States, municipalities and political subdivisions	4			—			10			3
Asset-backed	(1		)	6			(5		)	—
U.S. Treasury and obligations of government-sponsored enterprises	2			1			3			2
Foreign government	—			2			—			2
Total fixed maturity securities	44			16			76			(1		)
Equity securities	—			3			—			(2		)
Derivative financial securities	(3		)	(6		)	(2		)	(13		)
Short term investments and other	9			3			12			(4		)
Net realized investment gains (losses)	50			16			86			(20		)
Income tax (expense) benefit on net realized investment gains (losses)	(17		)	(8		)	(28		)	3
Net realized investment gains (losses), after tax	$	33		$	8		$	58		$	(17	)

Net realized investment gains, after tax, improved $25 million for the three months ended June 30, 2017 as compared with the same period in 2016, driven by higher net realized investment gains on sales of securities and lower OTTI losses recognized in earnings.

Net realized investment results, after tax, improved $75 million for the six months ended June 30, 2017 as compared with the same period in 2016, driven by higher net realized investment gains on sales of securities and lower OTTI losses recognized in earnings.

Further information on our realized gains and losses, including our OTTI losses, is set forth in Note C to the Condensed Consolidated Financial Statements included under Part I, Item 1.

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Portfolio Quality

The following table presents the estimated fair value and net unrealized gains (losses) of our fixed maturity securities by rating distribution.

	June 30, 2017				December 31, 2016
(In millions)	Estimated Fair Value		Net Unrealized Gains (Losses)		Estimated Fair Value		Net Unrealized Gains (Losses)
U.S. Government, Government agencies and Government-sponsored enterprises	$	4,249	$	39	$	4,212	$	32
AAA	1,819		139		1,881		110
AA	9,104		870		8,911		750
A	10,014		895		9,866		832
BBB	13,409		982		12,802		664
Non-investment grade	3,154		156		3,233		156
Total	$	41,749	$	3,081	$	40,905	$	2,544

As of June 30, 2017 and December 31, 2016, only 2% of our fixed maturity portfolio was rated internally.

The following table presents available-for-sale fixed maturity securities in a gross unrealized loss position by ratings distribution.

	June 30, 2017
(In millions)	Estimated Fair Value		Gross Unrealized Losses
U.S. Government, Government agencies and Government-sponsored enterprises	$	1,744	$	34
AAA	197		6
AA	616		10
A	635		12
BBB	1,150		22
Non-investment grade	598		20
Total	$	4,940	$	104

The following table presents the maturity profile for these available-for-sale fixed maturity securities. Securities not due to mature on a single date are allocated based on weighted average life.

	June 30, 2017
(In millions)	Estimated Fair Value		Gross Unrealized Losses
Due in one year or less	$	72	$	1
Due after one year through five years	785		15
Due after five years through ten years	3,035		66
Due after ten years	1,048		22
Total	$	4,940	$	104

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Duration

A primary objective in the management of the investment portfolio is to optimize return relative to corresponding liabilities and respective liquidity needs. Our views on the current interest rate environment, tax regulations, asset class valuations, specific security issuer and broader industry segment conditions and domestic and global economic conditions, are some of the factors that enter into an investment decision. We also continually monitor exposure to issuers of securities held and broader industry sector exposures and may from time to time adjust such exposures based on our views of a specific issuer or industry sector.

A further consideration in the management of the investment portfolio is the characteristics of the corresponding liabilities and the ability to align the duration of the portfolio to those liabilities and to meet future liquidity needs, minimize interest rate risk and maintain a level of income sufficient to support the underlying insurance liabilities. For portfolios where future liability cash flows are determinable and typically long term in nature, we segregate investments for asset/liability management purposes. The segregated investments support the long term care and structured settlement liabilities in the Life & Group Non-Core segment.

The effective durations of fixed maturity securities and short term investments are presented in the following table. Amounts presented are net of payable and receivable amounts for securities purchased and sold, but not yet settled.

	June 30, 2017			December 31, 2016
(In millions)	Estimated Fair Value		Effective Duration (In years)	Estimated Fair Value		Effective Duration (In years)
Investments supporting Life & Group Non-Core	$	16,375	8.7	$	15,724	8.7
Other interest sensitive investments	26,513		4.4	26,669		4.6
Total	$	42,888	6.1	$	42,393	6.1

The investment portfolio is periodically analyzed for changes in duration and related price risk. Additionally, we periodically review the sensitivity of the portfolio to the level of foreign exchange rates and other factors that contribute to market price changes. A summary of these risks and specific analysis on changes is included in the Quantitative and Qualitative Disclosures About Market Risk included under Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2016.

Short Term Investments

The carrying value of the components of the Short term investments are presented in the following table.

(In millions)	June 30, 2017		December 31, 2016
Short term investments:
Commercial paper	$	932	$	733
U.S. Treasury securities	186		433
Money market funds	76		44
Other	139		197
Total short term investments	$	1,333	$	1,407

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LIQUIDITY AND CAPITAL RESOURCES

Cash Flows

Our primary operating cash flow sources are premiums and investment income from our insurance subsidiaries. Our primary operating cash flow uses are payments for claims, policy benefits and operating expenses, including interest expense on corporate debt. Additionally, cash may be paid or received for income taxes.

For the six months ended June 30, 2017, net cash provided by operating activities was $515 million as compared with $613 million for the same period in 2016. Cash provided by operating activities reflected a lower level of distributions on limited partnerships and higher net claim payments partially offset by an increase in premiums collected and lower salaries and related expenses paid.

Cash flows from investing activities include the purchase and disposition of available-for-sale financial instruments and may include the purchase and sale of businesses, land, buildings, equipment and other assets not generally held for resale.

Net cash provided by investing activities was $111 million for the six months ended June 30, 2017, as compared with net cash used of $167 million for the same period in 2016. The cash flow from investing activities is affected by various factors such as the anticipated payment of claims, financing activity, asset/liability management and individual security buy and sell decisions made in the normal course of portfolio management. In the first quarter of 2016, we sold the principal executive offices of CNAF for $107 million.

Cash flows from financing activities may include proceeds from the issuance of debt and equity securities, outflows for stockholder dividends or repayment of debt and outlays to reacquire equity securities.

For the six months ended June 30, 2017, net cash used by financing activities was $677 million as compared with $538 million for the same period in 2016. In the first quarter of 2016, we issued $500 million of 4.50% senior notes due March 1, 2026 and redeemed the $350 million outstanding aggregate principal balance of our 6.50% senior notes due August 15, 2016.

Common Stock Dividends

Dividends of $2.50 per share on our common stock, including a special dividend of $2.00 per share, were declared and paid during the six months ended June 30, 2017. On July 28, 2017, our Board of Directors declared a quarterly dividend of $0.30 per share on our common stock, payable August 30, 2017 to stockholders of record on August 14, 2017. The declaration and payment of future dividends to holders of our common stock will be at the discretion of our Board of Directors and will depend on many factors, including our earnings, financial condition, business needs and regulatory constraints.

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Liquidity

We believe that our present cash flows from operating, investing and financing activities are sufficient to fund our current and expected working capital and debt obligation needs and we do not expect this to change in the near term. There are currently no amounts outstanding under our $250 million senior unsecured revolving credit facility and no borrowings outstanding through our membership in the Federal Home Loan Bank of Chicago (FHLBC).

Dividends from CCC are subject to the insurance holding company laws of the State of Illinois, the domiciliary state of CCC. Under these laws, ordinary dividends, or dividends that do not require prior approval by the Illinois Department of Insurance (the Department), are determined based on the greater of the prior year's statutory net income or 10% of statutory surplus as of the end of the prior year, as well as timing and amount of dividends paid in the preceding twelve months. Additionally, ordinary dividends may only be paid from earned surplus, which is calculated by removing unrealized gains from unassigned surplus. As of June 30, 2017 CCC was in a positive earned surplus position. The maximum allowable dividend CCC could pay during 2017 that would not be subject to the Department's prior approval is $1,075 million, less dividends paid during the preceding twelve months measured at that point in time. CCC paid dividends of $200 million during the six months ended December 31, 2016 and $775 million during the six months ended June 30, 2017. As of June 30, 2017 CCC is able to pay approximately $100 million of dividends that would not be subject to prior approval of the Department. The actual level of dividends paid in any year is determined after an assessment of available dividend capacity, holding company liquidity and cash needs as well as the impact the dividends will have on the statutory surplus of the applicable insurance company.

We have an effective automatic shelf registration statement under which we may publicly issue debt, equity or hybrid securities from time to time.

62

ACCOUNTING STANDARDS UPDATE

For discussion of Accounting Standards Updates adopted as of January 1, 2017 and that will be adopted in the future, see Note A to the Condensed Consolidated Financial Statements included under Part I, Item 1.

FORWARD-LOOKING STATEMENTS

This report contains a number of forward-looking statements which relate to anticipated future events rather than actual present conditions or historical events. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and generally include words such as “believes,” “expects,” “intends,” “anticipates,” “estimates,” and similar expressions. Forward-looking statements in this report include any and all statements regarding expected developments in our insurance business, including losses and loss reserves for A&EP and other mass tort claims which are more uncertain, and therefore more difficult to estimate than loss reserves respecting traditional property and casualty exposures; the impact of routine ongoing insurance reserve reviews we are conducting; our expectations concerning our revenues, earnings, expenses and investment activities; volatility in investment returns; expected cost savings and other results from our expense reduction activities; and our proposed actions in response to trends in our business. Forward-looking statements, by their nature, are subject to a variety of inherent risks and uncertainties that could cause actual results to differ materially from the results projected in the forward-looking statement. We cannot control many of these risks and uncertainties. These risks and uncertainties include, but are not limited to, the following:

Company-Specific Factors

• the risks and uncertainties associated with our insurance reserves, as outlined in the Critical Accounting Estimates and the Reserves - Estimates and Uncertainties sections of our Annual Report on Form 10-K, including the sufficiency of the reserves and the possibility for future increases, which would be reflected in the results of operations in the period that the need for such adjustment is determined;

• the risk that the other parties to the transaction in which, subject to certain limitations, we ceded our legacy A&EP liabilities will not fully perform their obligations to CNA, the uncertainty in estimating loss reserves for A&EP liabilities and the possible continued exposure of CNA to liabilities for A&EP claims that are not covered under the terms of the transaction;

• the performance of reinsurance companies under reinsurance contracts with us; and

• the risks and uncertainties associated with potential acquisitions and divestitures, including the consummation of such transactions, the successful integration of acquired operations and the potential for subsequent impairment of goodwill or intangible assets.

Industry and General Market Factors

• the impact of competitive products, policies and pricing and the competitive environment in which we operate, including changes in our book of business;

• product and policy availability and demand and market responses, including the level of ability to obtain rate increases and decline or non-renew underpriced accounts, to achieve premium targets and profitability and to realize growth and retention estimates;

• general economic and business conditions, including recessionary conditions that may decrease the size and number of our insurance customers and create additional losses to our lines of business, especially those that provide management and professional liability insurance, as well as surety bonds, to businesses engaged in real estate, financial services and professional services and inflationary pressures on medical care costs, construction costs and other economic sectors that increase the severity of claims;

• conditions in the capital and credit markets, including continuing uncertainty and instability in these markets, as well as the overall economy, and their impact on the returns, types, liquidity and valuation of our investments;

• conditions in the capital and credit markets that may limit our ability to raise significant amounts of capital on favorable terms; and

• the possibility of changes in our ratings by ratings agencies, including the inability to access certain markets or distribution channels and the required collateralization of future payment obligations as a result of such changes, and changes in rating agency policies and practices.

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Regulatory Factors

• regulatory initiatives and compliance with governmental regulations, judicial interpretations within the regulatory framework, including interpretation of policy provisions, decisions regarding coverage and theories of liability, legislative actions that increase claimant activity, trends in litigation and the outcome of any litigation involving us and rulings and changes in tax laws and regulations;

• regulatory limitations, impositions and restrictions upon us, including with respect to our ability to increase premium rates, and the effects of assessments and other surcharges for guaranty funds and second-injury funds, other mandatory pooling arrangements and future assessments levied on insurance companies; and

• regulatory limitations and restrictions, including limitations upon our ability to receive dividends from our insurance subsidiaries, imposed by regulatory authorities, including regulatory capital adequacy standards.

Impact of Catastrophic Events and Related Developments

• weather and other natural physical events, including the severity and frequency of storms, hail, snowfall and other winter conditions, natural disasters such as hurricanes and earthquakes, as well as climate change, including effects on global weather patterns, greenhouse gases, sea, land and air temperatures, sea levels, rain, hail and snow;

• regulatory requirements imposed by coastal state regulators in the wake of hurricanes or other natural disasters, including limitations on the ability to exit markets or to non-renew, cancel or change terms and conditions in policies, as well as mandatory assessments to fund any shortfalls arising from the inability of quasi-governmental insurers to pay claims;

• man-made disasters, including the possible occurrence of terrorist attacks, the unpredictability of the nature, targets, severity or frequency of such events, and the effect of the absence or insufficiency of applicable terrorism legislation on coverages; and

• the occurrence of epidemics.

Referendum on the United Kingdom's Membership in the European Union

• in 2016, the United Kingdom (U.K.) held a referendum in which voters approved an exit from the European Union (E.U.), commonly referred to as "Brexit". As a result of the referendum, in 2017 the British government formally commenced the process to leave the E.U. and began negotiating the terms of treaties that will govern the U.K.'s future relationship with the E.U. Although the terms of any future treaties are unknown, we believe changes in our international operating platform will be required to allow us to continue to write business in the E.U. after the completion of Brexit, therefore we have begun the process of establishing a new European subsidiary in Luxembourg. As a result of these changes, the complexity and cost of regulatory compliance of our European business is likely to increase.

Our forward-looking statements speak only as of the date of the filing of this Quarterly Report on Form 10-Q and we do not undertake any obligation to update or revise any forward-looking statement to reflect events or circumstances after the date of the statement, even if our expectations or any related events or circumstances change.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There were no material changes in our market risk components for the six months ended June 30, 2017. See the Quantitative and Qualitative Disclosures About Market Risk included in Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2016 for further information. Additional information related to portfolio duration is discussed in the Investments section of our Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Part I, Item 2.

Item 4. Controls and Procedures

The Company maintains a system of disclosure controls and procedures which are designed to ensure that information required to be disclosed by the Company in reports that it files or submits to the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including this report, is recorded, processed, summarized and reported on a timely basis. These disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed under the Exchange Act is accumulated and communicated to the Company's management on a timely basis to allow decisions regarding required disclosure.

As of June 30, 2017, the Company's management, including the Company's Chief Executive Officer (CEO) and Chief Financial Officer (CFO), conducted an evaluation of the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based on this evaluation, the CEO and CFO have concluded that the Company's disclosure controls and procedures are effective as of June 30, 2017.

There has been no change in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2017 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. Other Information

Item 1. Legal Proceedings

Information on our legal proceedings is set forth in Note F to the Condensed Consolidated Financial Statements included under Part I, Item 1.

Item 6. Exhibits

See Exhibit Index.

66

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

		CNA Financial Corporation
Dated: July 31, 2017	By	/s/ D. Craig Mense
		D. Craig Mense Executive Vice President and Chief Financial Officer

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EXHIBIT INDEX

Description of Exhibit	Exhibit Number
Retirement Agreement, dated April 4, 2017, between CNA Financial Corporation and Jonathan D. Kantor	10.1
Certification of Chief Executive Officer	31.1
Certification of Chief Financial Officer	31.2
Written Statement of the Chief Executive Officer of CNA Financial Corporation Pursuant to 18 U.S.C. Section 1350 (As adopted by Section 906 of the Sarbanes-Oxley Act of 2002)	32.1
Written Statement of the Chief Financial Officer of CNA Financial Corporation Pursuant to 18 U.S.C. Section 1350 (As adopted by Section 906 of the Sarbanes-Oxley Act of 2002)	32.2
XBRL Instance Document	101.INS
XBRL Taxonomy Extension Schema	101.SCH
XBRL Taxonomy Extension Calculation Linkbase	101.CAL
XBRL Taxonomy Extension Definition Linkbase	101.DEF
XBRL Taxonomy Label Linkbase	101.LAB
XBRL Taxonomy Extension Presentation Linkbase	101.PRE

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EX-10.1

EXHIBIT 10.1

RETIREMENT AGREEMENT

This Retirement Agreement (“Retirement Agreement”) is entered into by and between Jonathan D. Kantor (“Executive” or “you”) and CNA Financial Corporation (the “Company”) and confirms the agreement that has been reached with you in connection with your retirement from the Company.

1.    Retirement.

(a)    You agree that your retirement shall be effective as of July 7, 2017 (the “Retirement Date”) and as of such date you shall cease to be employed by the Company and by each and every subsidiary or affiliate of the Company in any capacity. This Retirement Agreement constitutes your resignation from employment and decision to retire, effective as of the Retirement Date, as an employee and officer of the Company, and as an employee, officer and/or director (or similar governing board member) of each of the Company’s subsidiaries and affiliates. You further agree to execute promptly upon request by the Company any additional documents necessary to effectuate the provisions of this Section 1(a).

(b)    From the date of this Retirement Agreement through the Retirement Date, you agree to assist the Company in the transition of your duties to a new general counsel as requested by the chief executive officer of the Company (the “CEO”). During the period between the date of this Retirement Agreement and the Retirement Date, because of your impending retirement, your duties, responsibilities and authority will be modified by the CEO at his discretion.

(c)    Notwithstanding the foregoing, during the period from the date of this Retirement Agreement through the Retirement Date you will remain an employee at will whose employment may be terminated by you or the Company for any reason (or without stated reason). If your employment is terminated for any reason prior to the Retirement Date, the date of termination will become the Retirement Date for all purposes of this Retirement Agreement. If your employment is terminated prior to the original Retirement Date (i.e., July 7, 2017) by reason of your death or Disability (as the term “Disability” is defined in the CNA Financial Corporation Incentive Compensation Plan (the “Incentive Plan”), or termination by the Company without Cause (as defined below), you (or your estate) will be entitled to the Retirement Agreement Payments described in, and in accordance with, Section 2, which, in the case of your death, will be paid in a single lump sum, provided that you (or your estate) executes and does not revoke the Supplemental Release described in Section 2. For purposes of this Retirement Agreement, “Cause” shall mean the Executive engaged in (i) criminal activity, unless Executive had no reasonable cause to believe his conduct was unlawful or (ii) material willful misconduct that, if capable of being cured, is not cured after five (5) business days written notice of such misconduct. If your employment is terminated prior to July 7, 2017 either by you voluntarily, or by the Company for Cause, you will not be entitled to the Retirement Agreement Payments described in Section 2.

2.    Retirement Agreement Payments. In recognition of your significant contributions over twenty-three years of employment, provided that you (i) execute this Retirement Agreement not later than the twenty-first day after it is furnished to you, (ii) do not exercise the right of revocation set forth in Section 14, (iii) execute and do not revoke the Supplemental Release substantially in the form attached hereto as Exhibit A within twenty-one (21) days after the Retirement Date (but not earlier than the Retirement Date), and (iv) otherwise comply in all material respects with all of the terms and conditions of this Retirement Agreement (including transitioning your duties to a new general counsel as requested by the CEO through the original Retirement Date and curing any issues (that are capable of being cured) identified by the Company in a written notice of non-compliance within five (5) business days, except as otherwise provided in Section 1(c)), the Company shall pay or provide you with the following benefits (the “Retirement Agreement Payments”):

(a)    You will be paid the amount of Four Million Five Hundred Thousand Dollars ($4,500,000) (the “Retirement Payment”), payable in two equal installments, the first of which shall be paid within fifteen (15) days after the expiration of the revocation period for the Supplemental Release and the second of which shall be paid on or before January 16, 2018. Normal and customary payroll withholdings and deductions shall be made from each installment of the Retirement Payment, and the amount will be reported for tax purposes as required by law. In connection with this payment, the Company shall issue a Form W-2 in the regular course of business. Each installment of the Retirement Payment (and each payment pursuant to Sections 2(b) and 2(c)) shall be considered a separate “payment” for purposes of Section 409A of the Internal Revenue Code (“Section 409A”).

(b)    After the Retirement Date, provided that you elect coverage under the Company’s medical plans under Section 4980B of the Internal Revenue Code (“COBRA”), the Company will reimburse you with respect to the current health elections you have made for each month that COBRA coverage is in effect, up to a maximum of eighteen (18) months, for the premium payable for such COBRA coverage.

(c)    After the conclusion of the eighteen month period of COBRA coverage described in Section 2(b), you will be eligible to enroll in the Company’s retiree health plan, and the Company will reimburse you with respect to the current health elections you have made for each month that such coverage is in effect, up to a maximum of six (6) months, for the premium payable under the retiree health plan for such coverage. If for any reason you are not eligible for participation in the retiree health plan (or the Company no longer sponsor such a plan) the Company will pay you an amount equal to the premium cost for comparable coverage.

(d)    You will be fully vested in your entire 2015 Long Term Incentive Grant (the “2015 LTIP”) under the Incentive Plan as of the expiration of the revocation period for the Supplemental Release. In addition, as soon as practicable after the expiration of the revocation period for the Supplemental Release (but not later than 30 days afterwards), you will receive a payment, paid fifty percent in cash and fifty percent in shares of Company stock, under the 2015 LTIP calculated as though the Company attained its performance results for the performance period at fifty percent (50%) of the target level. When all the Company 2015 LTIPs are settled in the ordinary course in March 2018, you will be eligible to receive a payment, paid fifty percent in cash and fifty percent in shares of Company stock, under the terms of the 2015 LTIP (taking into account full vesting as described above), reduced by the payment described above. For avoidance of doubt, if the final performance results are less than 50% of target, you will not be required to return any portion of the payment.

3.    Accrued Benefits.

(a)    Whether or not you choose to sign this Retirement Agreement (or the Supplemental Release), you will be entitled to receive (i) base salary at your current rate through the Retirement Date, (ii) to the extent not previously paid, unreimbursed business expenses (in accordance with usual Company policies and practice), and (iii) continued participation in all Company retirement and deferred compensation plans and all health and welfare plans through the Retirement Date in accordance with the terms of such plans, (iv) vested benefits under all Company retirement and deferred compensation plans and COBRA coverage continuation rights under any Company health care plan, in accordance with the terms of such plans and applicable law. You will also be entitled to any rights to contribution, advancement of expenses, defense or indemnification you may have under the Company’s current Articles of Incorporation or Bylaws, as applicable, or as provided under applicable law.

(b)    Whether or not you choose to sign this Retirement Agreement (or the Supplemental Release), your retirement as of the original Retirement Date will constitute retirement as defined in any plan or policy of the Company that defines retirement as termination on or after age 62 (if the original Retirement Date is on or after your sixty-second birthday), or on or after satisfying the “Rule of 65”, including without limitation the CNA Retirement Plan, the CNA Supplemental Executive Retirement Plan (the “SERP”), the CNA 401(k) Plus Plan, the CNA Nonqualified Savings Plan (the “SSP”), and the Incentive Plan, and your benefits under such plans will be consistent with those of a retiree (except as otherwise provided in Section 2(d) with respect to the 2015 LTIP). For avoidance of doubt, it is agreed that:

(i)    if your Retirement Date is on or after July 7, 2017, your 2016 SSE grant under the Incentive Plan will be fully vested on the Retirement Date and paid in shares of Company stock within thirty (30) days following your Retirement Date and your 2016 PSP grant under the Incentive Plan will be fully vested on the Retirement Date and paid in shares of Company stock on the first business day that is six (6) months after your Retirement Date.

(ii)    you may elect to commence your benefit under the CNA Retirement Plan as of the first day of any month following your Retirement Date and prior to April 1 after the year in which you reach age 70-1/2, in any form permitted by such plan.

(iii)    you may withdraw your account in the CNA 401(k) Plus Plan at any time after your Retirement Date and prior to April 1 after the year in which you reach age 70-1/2, which will be paid in a lump sum, subject to your right to roll over any portion of such payment as permitted by applicable law.

(iv)    the pre-2005 portion of your benefit under the SERP will be paid in a lump sum not more than fifteen (15) days after your Retirement Date in accordance with Section 2.5 of the SERP, and the Company will not exercise its discretion to pay the Pre-2005 portion in any form other than a lump sum, and the Post-2004 portion will be paid in a lump sum on the first business date that is six months after your Retirement Date. Such payments will bear interest until paid in accordance with the SERP. The plan administrators of the SERP and the SSP will not exercise their discretion to change the methodology for calculating benefits under either plan after the date of this Retirement Agreement, if the effect is to materially reduce the amount of your benefit thereunder. If any such change in methodology were to occur, then your benefit thereunder will be calculated without regard to such change. The plan administrators will act in accordance with this Section 3(b)(iv). No later than five (5) business days prior to the payment of amounts to Executive under this Section 3(b)(iv), the Company will provide Executive with a good faith estimate of the applicable payment being made under the SERP and withholdings related thereto.

(v)    the pre-2005 portion of your account under the SSP will be paid in a lump sum not more than fifteen (15) days after your Retirement Date, and the post-2004 portion will be paid on the first business date that is six months after your Retirement Date. Both portions will continue to be credited with earnings under such plan until paid in accordance with the terms of the SSP. The plan administrator of the SSP will act in accordance with this Section 3(b)(v).

(c)    If your employment is terminated by the Company prior to the original Retirement Date without Cause, then, in addition to the Retirement Agreement Payments, the Company will pay you an amount equal to the value of the additional benefits to which you would have been entitled under the foregoing plans, if any, had your termination occurred on the original Retirement Date, subject to your executing and not revoking the Supplemental Release. Such amount shall be paid in a lump sum within thirty (30) days following the Retirement Date or, to the extent required by Section 409A of the Internal Revenue Code, at the same time that the additional benefits would have been paid under the terms of the applicable plan. For avoidance of doubt, if your employment is terminated prior to the original Retirement Date for any other reason, including by reason of death or Disability, your benefits under such plans shall be as provided by the terms of such plans.

4.    No Other Payments or Benefits. You acknowledge and agree that, other than the payments and benefits expressly set forth in this Retirement Agreement, you have received all compensation to which you are entitled from the Company, and you are not entitled to any other payments or benefits from the Company. Other than as set forth in this Retirement Agreement, after the Retirement Date, you shall not receive any base salary, annual bonus, short term or long term incentive award, welfare, retirement, perquisite, fringe benefit, or other benefit plan coverage or coverage under any other practice, policy or program as may be in effect from time to time, applying to senior officers or other employees of the Company. Without limiting in any way the foregoing, it is expressly agreed that you are not entitled to (a) any payment pursuant to the Company’s Annual Incentive Bonus plan for 2017, (b) any award pursuant to the CNA Financial Corporation Incentive Compensation Plan for 2017, or (c) any payments provided for under your employment agreement, dated as of April 1, 2008, which agreement expired by its terms on June 30, 2011, and was not renewed.

5.    Agreement Not to Interfere with Business Relationships. You agree that beginning on the Retirement Date and for a period of six (6) months thereafter you will not, directly or indirectly, without the prior written approval of the CEO, enter into any business relationship (either as principal, agent, board member, officer, consultant, stockholder, employee or in any other capacity) with any business or other entity that at any relevant time is engaged in the business of insurance in direct or indirect competition with the Company or any of its affiliates (a “Competitor”); provided, however, that such prohibited activity shall not include the ownership of less than 5% of the outstanding securities of any publicly traded corporation (determined by vote or value) regardless of the business of such corporation. Upon the written request of Executive, the CEO will determine whether a business or other entity constitutes a "Competitor" for purposes of this Section 5; provided that the CEO may require Executive to provide such information as the CEO reasonably determines to be necessary to make such determination; and further provided that the current and continuing effectiveness of such determination may be conditioned on the accuracy of such information, and on such other factors as the CEO may reasonably determine.

6.    Agreement Not To Solicit Employees. You agree that beginning on the Retirement Date and for a period of twenty-four (24) months thereafter you will not employ, offer to employ, engage as a consultant, or form an association with any person who is then, or who during the preceding one year was, an employee of the Company or any Subsidiary or Affiliate of the Company or any successor or purchaser of any portion thereof, nor will you assist any other person or entity in soliciting for employment or consultation any person who is then, or who during the preceding one year was, an employee of the Company or any Subsidiary or Affiliate of the Company or any successor or purchaser of any portion thereof.

7.    Non-Disparagement.

(a)    You agree that you will not, and will not encourage or induce others to, make, publish or communicate in any public forum any defamatory or disparaging remarks, comments or statements concerning the Company, its subsidiaries, or affiliates or any of their respective past, present or future directors, officers, employees, agents, shareholders or members or any of their respective successors and assigns (collectively, the “Company Entities and Persons”), except as required by court order or otherwise by law.

(b)    The Company agrees that it and its subsidiaries will not, and will not encourage or induce others to, make, publish or communicate in any public forum any defamatory or disparaging remarks, comments or statements concerning Executive, except as required by court order or otherwise by law.

(c)    Nothing in this Retirement Agreement is intended to or shall prevent any person from providing, or limiting testimony in response to a valid subpoena, court order, regulatory request or other judicial, administrative or legal process or otherwise as required by law.

8.    Cooperation. Beginning on the Retirement Date and for sixty (60) months thereafter, you agree that you will reasonably cooperate with and assist the Company, its subsidiaries and affiliates, and any of their respective officers, directors, shareholders, or employees: (A) concerning requests for information about the business of the Company or its subsidiaries or affiliates or your involvement and participation therein (including but not limited to requests and subpoenas to provide information or testimony), (B) in connection with any investigation or review by the Company or any federal, state or local regulatory, quasi-regulatory or self-governing authority as any such investigation or review relates to events or occurrences that transpired while you were employed by the Company, and (C) with respect to transition and succession matters. Your cooperation and assistance shall include, but not be limited to (taking into account your personal and professional obligations, including those to any new employer or entity to which you provide services), being available to meet and speak with officers or employees of the Company and/or the Company’s counsel at reasonable times and locations, executing accurate and truthful documents and taking such other actions as may reasonably be requested by the Company and/or the Company’s counsel to effectuate the foregoing. You further agree that you will notify the Company’s Chief Human Resources Officer in writing as promptly as practicable after receiving any request for testimony or information that relates to the Company or the Company’s business (or to any of the Company’s affiliates) in response to a subpoena, court order, regulatory request or other judicial, administrative or legal process or otherwise as required by law, regarding the anticipated testimony or information to be provided and at least ten

(10) days prior to providing such testimony or information (or, if such notice is not possible under the circumstances, with as much prior notice as is possible). As used herein, cooperation and assistance does not mean Executive must provide information favorable to the Company; Executive will, upon reasonable request by the Company, testify truthfully in a proceeding or provide other information requested by the Company. It is understood by the parties that air travel shall not be required for purposes of cooperation under this Section 8 unless reasonably determined by the Company to be necessary. In the event such travel is required, you shall be entitled to (a) reimbursement from the Company, upon receipt by the Company of suitable documentation, for reasonable and necessary travel and other expenses which you may incur on such matters at the specific request of the Company and as approved by the Company in advance and in accordance with its policies and procedures established from time to time and, (b)  payments from the Company in an amount equal to $200 per hour for each such hour you reasonably spend on such matters at the Company’s specific request. You shall invoice the Company for any expenses incurred and services rendered. Your invoices shall contain: (1) the date of services; (2) a short description of the services rendered and any expenses incurred; and (3) the number of hours spent on each service, rounded to the nearest tenth of an hour. Invoices shall be submitted via email to Elizabeth.Aguinaga@cna.com. The Company shall have thirty (30) days from the date of invoice submission to remit payment.

9.    Company Property; Certain Transition Matters; Confidentiality.

(a)    On or prior to the Retirement Date, you shall return to the Company all Company property in your possession or use, including, without limitation other than as described below, all automobiles, printers, credit cards, building-access cards and keys, other electronic equipment and related materials, and any records, software or other data from your personal computers or laptops which are not themselves Company property, however stored, relating to the Company’s confidential information. Executive may retain his Company-issued cell phone and corresponding cell phone number. Executive agrees to cooperate with the Company to transfer the cell phone number into Executive’s name and to ensure all confidential Company information is deleted from the cell phone.

(b)    From and after the Retirement Date you will not represent (or purport to represent) the Company or any of its affiliates in any capacity to any person or entity, or enter into (or purport to enter into) any transactions, agreements or understandings on behalf of the Company or any of its affiliates with any person or entity.

(c)    You agree that prior to and at all times after the Retirement Date, you shall not reveal or utilize confidential information (as defined below) which relates to: (i) the Company, any business or entity in which the Company during the course of your employment has directly or indirectly held a greater than a 10% equity interest, whether voting or non-voting, and/or any other Company Entity or Person; or (ii) the Company’s customers, employees, agents, brokers and vendors. You acknowledge that all such confidential information is commercially valuable and is the property of the Company. For purposes of this Retirement Agreement “confidential information” includes all information, knowledge or data (whether or not a trade secret or protected by laws pertaining to intellectual property) not generally known outside the Company (unless as a result of a breach of any of the obligations imposed by this Retirement Agreement) concerning or relating to the business operations, performance and other information of the Company or other entities as described above. Such information may without limitation include information relating to data, finances, marketing, pricing, profit margins, underwriting, claims, loss control, marketing and business plans, renewals, software, processing, vendors, administrators, customers or prospective customers, products, brokers, agents and employees.

(d)    Notwithstanding the foregoing, in accordance with the Defend Trade Secrets Act of 2016, you are hereby notified that you will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (i) is made (A) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. If you file a lawsuit for retaliation by the Company for reporting a suspected violation of law, you may disclose the Company’s trade secrets to your attorney and use the trade secret information in the court proceeding if you (i) file any document containing the trade secret under seal; and (ii) do not disclose the trade secret, except pursuant to court order.

10.    Taxes. The parties acknowledge and agree that: the form and timing of the Retirement Agreement Payments and the other payments and benefits to be provided pursuant to this Retirement Agreement are intended to be exempt from or to comply with the requirements of Section 409A, including the requirement for a six-month suspension on payments to “specified employees” as defined in Section 409A that are not otherwise permitted to be paid within the six-month suspension period. Notwithstanding the foregoing, it is also agreed that you have had the opportunity to seek the advice of independent tax counsel with respect to the potential application of Section 409A to the Retirement Agreement Payments and the other payments and benefits described in this Retirement Agreement, and are not relying upon the advice of the Company or any person affiliated with the Company with respect thereto. In no event shall the Company or any person affiliated with the Company have any liability to you with respect to any adverse tax consequences, under Section 409A or otherwise, related to the payment of the Retirement Agreement Payments and the other payments and benefits described in this Retirement Agreement.

11.    Executive Release and Covenant Not to Sue.

(a)    You agree that, in consideration of this Retirement Agreement, you hereby waive, release and forever discharge, to the extent permitted by applicable law, any and all claims, complaints, promises, agreements, controversies, liens, demands, actions, causes of action, obligations, suits, disputes, judgments, rights, debts, bonds, bills, covenants, contracts, variances, trespasses, executions, damages and liabilities of any nature whatsoever (collectively “Claims”) which you ever had, now have or may have against the (i) Company, (ii) the Company’s past, present and future subsidiaries, affiliates and shareholders (including without limitation Loews Corporation and its affiliates), and (iii) the past, present and future shareholders, members, directors, officers, agents, employees, attorneys, insurers, predecessors, various benefits committees, successors and assigns, heirs, executors and personal and legal representatives of the Company and the Company’s past, present and future subsidiaries, affiliates and shareholders (including without limitation those of Loews Corporation and its affiliates) ((i), (ii) and (iii), collectively, the “Released Parties”), based on or relating to any act, event or omission occurring before you execute this Retirement Agreement arising out of, during or relating to your employment or services with the Company or the cessation of such employment or services, except for claims relating to the enforcement of the Company’s obligations under this Retirement Agreement or as provided below. This waiver and release includes, but is not limited to, any claims which could be asserted now or in the future, under: common law, including, but not limited to, breach of express or implied duties, wrongful termination, retaliation, defamation, or violation of public policy; any policies, practices, or procedures of the Company; any federal or state statutes or regulations including, but not limited to, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., the Civil Rights Act of 1866 and 1871, the Age Discrimination in Employment Act, as amended, 29 U.S.C. § 621 et seq., the Americans With Disabilities Act, 42 U.S.C. §12101 et seq., the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 41001 et seq. (excluding those rights relating exclusively to employee pension benefits as governed by ERISA), the Family and Medical Leave Act, 29 U.S.C. §2601 et. seq., the Illinois Human Rights Act, the New York Wage and Hour Law (N.Y. Lab. Law § 190 et. seq.), New York Equal Pay Law (N.Y. Lab. Law § 194), the New York Minimum Wage Act, (N.Y. Lab. Law §§ 650 to 665); any contract of employment, express or implied; and any provision of any other law, common or statutory, of the United States, Illinois, New York, or any applicable state. For the purpose of implementing a full and complete release, you understand and agree that this Retirement Agreement is intended to waive and release all claims, if any, which you may have and which you may not now know or suspect to exist in your favor against any of the Released Parties and this Retirement Agreement extinguishes those claims.

(b)    By signing this Retirement Agreement, you represent that you have not and will not in the future commence any action or proceeding arising out of the Claims described in Section 11(a), and that you will not seek or be entitled to any award of legal or equitable relief in any such action or proceeding that may be commenced on your behalf. The provisions of this Section 11(b) constitute a “covenant not to sue.” A “covenant not to sue” is a legal term which means you promise not to file a lawsuit in court. It is different from the Release of Claims contained in Section 11(a) above. Besides waiving and releasing Claims covered by Section 11(a), you further agree never to sue any Released Party in any forum for any reason covered by the release of Claims. Notwithstanding this covenant not to sue, you may bring a Claim against the Company to enforce this Retirement Agreement or, to the extent permitted under the law, to challenge the validity of this Retirement Agreement under the ADEA. If you sue a Released Party in violation of this Retirement Agreement, you shall be liable to the Released Party for

its reasonable attorneys’ fees and other litigation costs incurred in defending against your suit. Alternatively, if you sue a Released Party in violation of this Retirement Agreement, the Company can require you to return all but One Thousand Dollars ($1,000.00) of the Retirement Payment.

12.    Release Exclusions/Additional Rights of Executive. Nothing in the Release above or any other part of this Retirement Agreement shall: (i) affect any rights of defense or indemnification, or to be held harmless, or any coverage under directors and officers liability insurance or any other insurance or rights or claims of contribution or advancement of expenses that you have; (ii) waive any future rights or claims that you may have; (iii); waive, release or otherwise discharge any other claim or cause of action that cannot legally be waived; or (iv) interfere with your right to file a charge or cooperate with, provide information to, or participate in an investigation or proceeding conducted by, the Equal Employment Opportunity Commission (“EEOC”) or any other federal or state regulatory or law enforcement agency. You nonetheless acknowledge and agree that any Claims for personal relief in connection with such a charge or investigation (such as reinstatement or monetary damages) would be and hereby are barred. You may, however, receive money from the Securities & Exchange Commission (“SEC”) as a reward for providing information to that agency.

13.    Company Release of Executive and Covenant Not to Sue. On behalf of itself and each of its subsidiaries, the Company hereby waives, releases and forever discharges, to the extent permitted by applicable law, any Claims which such parties ever had, now have or may have against you based on or relating to any act, event or omission occurring before the date of this Retirement Agreement arising out of, during or relating to your employment or services with the Company or the cessation of such employment or services, except for Claims relating to the enforcement of your obligations under this Retirement Agreement, or for fraudulent acts. In addition, the Company represents that neither it nor any of its subsidiaries has or will in the future commence any action or proceeding arising out of the Claims described in the preceding sentence, and that neither it nor any of its subsidiaries will seek or be entitled to any award of legal or equitable relief in any such action or proceeding that may be commenced on its behalf.

14.    Time to Consider, Consult With Counsel and Revoke.

(a)    You acknowledge that you have been given at least twenty-one (21) days to consider this Retirement Agreement before signing it.

(b)    You acknowledge that you have been advised by the Company, in writing, to consult an attorney with respect to this Retirement Agreement before signing it.

(c)    You have the right to revoke this Retirement Agreement after signing it by written notice to the Company sent by reputable overnight courier or email not more than seven (7) days after the date of your execution of this Retirement Agreement. Notice of revocation should be addressed to CNA Financial Corporation, 333 South Wabash Ave., Chicago, IL 60603, Attn: Elizabeth Aguinaga, Chief Human Resources Officer, or if by email, addressed to Elizabeth.Aguinaga@cna.com. If you choose to revoke this Retirement Agreement, it shall be null and void and without limiting the generality of the foregoing, you shall no longer be entitled to the pay and benefits under Section 2 or any other Section of this Retirement Agreement, and the Company’s release of Claims, and covenant not to sue, under Section 13 will be null and void.

15.    Enforcement. If any provision of this Retirement Agreement is held by a court of competent jurisdiction to be illegal, void or unenforceable, such provision shall have no effect; however, the remaining provisions shall be enforced to the maximum extent possible. Further, if a court should determine that any portion of this Retirement Agreement is overbroad or unreasonable, such provision shall be given effect to the maximum extent possible by narrowing or enforcing in part that aspect of the provision found overbroad or unreasonable. In addition, you agree that your knowing failure to return Company property that relates to the maintenance of security of the Company Entities and Persons shall entitle the Company to injunctive and other equitable relief.

16.    No Admission. This Retirement Agreement is not intended, and shall not be construed, as an admission that either you or the Company Entities and Persons have violated any federal, state or local law (statutory or decisional), ordinance or regulation, breached any contract or committed any wrong whatsoever.

17.    Successors. This Retirement Agreement is binding upon, and shall inure to the benefit of, the parties and their respective heirs, executors, administrators, successors and assigns.

18.    Choice of Law. This Retirement Agreement shall be construed and enforced in accordance with the laws of the State of Illinois without regard to the principles of conflicts of law.

19.    Entire Agreement. You acknowledge that this Retirement Agreement constitutes the complete understanding between the Company and you regarding its subject matter and supersedes any and all agreements, understandings, and discussions, whether written or oral, between you and any of the Company Entities and Persons. No other promises or agreements shall be binding on the Company unless in writing and signed by both the Company and you after the date of this Retirement Agreement. This Retirement Agreement shall be construed as though both parties had participated equally in its drafting, and shall not be construed against either party as the drafting party.

20.    Effective Date. You may accept this Retirement Agreement by signing it and returning it to CNA Financial Corporation, 333 South Wabash Ave., Chicago, IL 60603, Attn: Elizabeth Aguinaga, Chief Human Resources Officer not later than the twenty-first (21st) day after the Retirement Agreement is provided to you. The effective date of this Retirement Agreement shall be the date after the 7-day revocation period expires. In the event you do not accept this Retirement Agreement as set forth in this Section 20, this Retirement Agreement, including but not limited to, the obligation of the Company hereunder to provide the payments and other benefits under this Retirement Agreement, shall be deemed automatically null and void.

21.    Headings. The headings used herein are for the convenience of reference only, do not constitute part of this Retirement Agreement and shall not be deemed to limit or otherwise affect any of the provisions of this Retirement Agreement.

22.    Counterparts. This Retirement Agreement may be executed in one or more counterparts, including emailed or telecopied facsimiles, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

[SIGNATURES FOLLOW]

IN WITNESS WHEREOF, the parties have executed this Retirement Agreement as of the dates set forth below.

/s/ Jonathan D. Kantor	Date: April 4, 2017
Jonathan D. Kantor

CNA FINANCIAL CORPORATION

By:	/s/ Dino E. Robusto	Date: April 4, 2017
	Dino E. Robusto
	Chairman and Chief Executive Officer

[Signature Page to Retirement Agreement]

EXHIBIT A

SUPPLEMENTAL RELEASE

In order for you to be eligible to receive the Retirement Agreement Payments described in Section 2 of the Retirement Agreement (the “Retirement Agreement”) between you and CNA Financial Corporation (the “Company”), which is payable after your Retirement Date (as defined in the Retirement Agreement), you must execute this Supplemental Release (the “Supplemental Release”) and not revoke the Supplemental Release as provided in Section 4 below. You must execute this Supplemental Release not earlier than your Retirement Date, and not later than twenty-one (21) days after your Retirement Date, and the Retirement Agreement Payments will not be paid to you until the period for revoking this Supplemental Release has expired.

1.    Release of Claims. In exchange for the promises and covenants made in the Retirement Agreement by the Company, I hereby waive, release and forever discharge, to the extent permitted by applicable law, any and all claims, complaints, promises, agreements, controversies, liens, demands, actions, causes of action, obligations, suits, disputes, judgments, rights, debts, bonds, bills, covenants, contracts, variances, trespasses, executions, damages and liabilities of any nature whatsoever (collectively “Claims”) which I ever had, now have or may have against the (i) Company, (ii) the Company’s past, present and future subsidiaries, affiliates and shareholders (including without limitation Loews Corporation and its affiliates), and (iii) the past, present and future shareholders, members, directors, officers, agents, employees, attorneys, insurers, predecessors, various benefits committees, successors and assigns, heirs, executors and personal and legal representatives of the Company and the Company’s past, present and future subsidiaries, affiliates and shareholders (including without limitation those of Loews Corporation and its affiliates) ((i), (ii) and (iii), collectively, the “Released Parties”), based on or relating to any act, event or omission occurring before I execute this Supplemental Release arising out of, during or relating to my employment or services with the Company or the cessation of such employment or services, except for claims relating to the enforcement of the Company’s obligations under the Retirement Agreement or as provided below. This waiver and release includes, but is not limited to, any claims which could be asserted now or in the future, under: common law, including, but not limited to, breach of express or implied duties, wrongful termination, retaliation, defamation, or violation of public policy; any policies, practices, or procedures of the Company; any federal or state statutes or regulations including, but not limited to, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., the Civil Rights Act of 1866 and 1871, the Age Discrimination in Employment Act, as amended, 29 U.S.C. § 621 et seq., the Americans With Disabilities Act, 42 U.S.C. §12101 et seq., the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 41001 et seq. (excluding those rights relating exclusively to employee pension benefits as governed by ERISA), the Family and Medical Leave Act, 29 U.S.C. §2601 et. seq., the Illinois Human Rights Act, the New York Wage and Hour Law (N.Y. Lab. Law § 190 et. seq.), New York Equal Pay Law (N.Y. Lab. Law § 194), the New York Minimum Wage Act, (N.Y. Lab. Law §§ 650 to 665); any contract of employment, express or implied; and any provision of any other law, common or statutory, of the United States, Illinois, New York or any applicable state. For the purpose of implementing a full and complete release, I understand and agree that this Supplemental Release is intended to waive and release all claims, if any, which I may have and which I may not now know or suspect to exist in my favor against any of the Released Parties and this Supplemental Release extinguishes those claims.

2.    Promise Not To Sue. A “promise not to sue” means I promise not to sue any Released Party in court. This is different from the release of Claims in Section 1 above. Besides waiving those Claims, I agree never to sue any Released Party for any reason related to any Claim. I may, however, file suit to enforce this Supplemental Release or the Retirement Agreement or to challenge their validity under the ADEA. If I sue any Released Party in violation of this Supplemental Release: (i) I shall be required to pay that Released Party’s reasonable attorneys’ fees and other litigation costs incurred in defending against my suit, or alternatively (ii) the Company can require me to return all but $1,000.00 of the Retirement Payment. In that event, the Company shall be excused from any remaining obligations that exist solely because of this Supplemental Release.

3.    Additional Release Exclusions and Other Employee Protections. Nothing in the Release above nor anything else in this Supplemental Release shall: (i) affect any rights of defense or indemnification, or to be held harmless, or any coverage under directors and officers liability insurance or any other insurance or rights or claims of contribution or advancement of expenses that I have; (ii) waive any future rights or claims that I may have; (iii) waive, release or otherwise discharge any claim or cause of action that cannot legally be waived; or (iv) interfere with my right to file a charge or cooperate with, provide information to, or participate in an investigation or proceeding conducted by, the EEOC or any other federal or state regulatory or law enforcement agency. However, I give up all rights to recover money or other individual relief from the Released Parties in connection with any administrative charge, investigation, or proceeding, whether initiated by me or another individual or an agency and whether individual or class allegations are involved. However, nothing in this Supplemental Release limits my right to receive money from the SEC as a reward for providing information to that agency.

4.    Time to Consider, Consult With Counsel and Revoke. The Company has advised me to consult with an attorney of my choosing before signing this Supplemental Release. I understand that I have twenty-one (21) days within which to consider this Supplemental Release before signing, and that I may revoke this Supplemental Release within seven (7) days after signing it. For my revocation to be effective, a written notice of revocation must be mailed to CNA Financial Corporation, 333 South Wabash Ave., Chicago, IL 60603, Attn: Elizabeth Aguinaga, Chief Human Resources Officer, or sent by e-mail addressed to Elizabeth.Aguinaga@cna.com, and in either case must be received before the eighth (8th) day after I signed this Supplemental Release. I further understand that if I revoke this Supplemental Release, it shall be null and void and I shall no longer be entitled to the Retirement Agreement Payments described in Section 2 or any other Section of the Retirement Agreement, and the Company’s release of any Claims against me and covenant not to sue with respect to such Claims pursuant to Section 13 of the Retirement Agreement and Section 5 of this Supplemental Release will be null and void.

5.    Company Release and Covenant Not to Sue. On behalf of itself and each of its subsidiaries, the Company hereby waives, releases and forever discharges, to the extent permitted by applicable law, any Claims which such parties ever had, now have or may have against me based on or relating to any act, event or omission occurring after the date of the Retirement Agreement and prior to the date of this Supplemental Release, arising out of, during or relating to my employment or services with the Company or the cessation of such employment or services, except for Claims relating to the enforcement of my obligations under the Retirement Agreement and this Supplemental Release, or fraudulent acts. In addition, the Company represents that neither it nor any of its subsidiaries has or will in the future commence any action or proceeding arising out of the Claims described in the preceding sentence, and that neither it nor any of its subsidiaries will seek or be entitled to any award of legal or equitable relief in any such action or proceeding that may be commenced on its behalf.

6.    Additional Employee Representations. I acknowledge that:

• I have knowingly and voluntarily executed this Supplemental Release.

• The Retirement Agreement Payments to be provided to me under this Supplemental Release exceeds what I am otherwise entitled to receive as a separated employee of the Company.

• I have not filed any lawsuits against the Company or any Released Party.

• No one has interfered with my ability to report within the Company possible violations of any law, and it is the Company’s policy to encourage such reporting.

• I have received all pay/other compensation I was due up through the last regular paycheck I received before signing this Supplemental Release.

• I have not suffered any on-the-job injury or illness for which I have not already filed a claim, and the end of my employment is not related to any such injury or illness.

IN WITNESS WHEREOF, the Executive has executed this Supplemental Release as of the date set forth below.

	Date:
Jonathan D. Kantor

IN WITNESS WHEREOF, by its execution of this Supplemental Release, the Company agrees to the provisions of Section 5 hereof.

CNA FINANCIAL CORPORATION

By:		Date:
	Dino E. Robusto
	Chairman and Chief Executive Officer

EX-31.1

EXHIBIT 31.1

SARBANES-OXLEY ACT SECTION 302

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Dino E. Robusto, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CNA Financial 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 officers 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 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 officers 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 registrant’s board of directors (or persons performing the equivalent function):

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.

Dated:	July 31, 2017	By	/s/ Dino E. Robusto
			Dino E. Robusto
			Chief Executive Officer

EX-31.2

EXHIBIT 31.2

SARBANES-OXLEY ACT SECTION 302

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, D. Craig Mense, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CNA Financial 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 officers 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 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 officers 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 registrant’s board of directors (or persons performing the equivalent function):

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.

Dated:	July 31, 2017	By	/s/ D. Craig Mense
			D. Craig Mense
			Chief Financial Officer

EX-32.1

EXHIBIT 32.1

Written Statement of the Chief Executive Officer

of CNA Financial Corporation

Pursuant to 18 U.S.C. § 1350

(As adopted by Section 906 of the Sarbanes-Oxley Act of 2002)

The undersigned, the Chief Executive Officer of CNA Financial Corporation (the Company), hereby certifies that, to his knowledge:

• the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2017 filed on the date hereof with the Securities and Exchange Commission (the Report) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

• the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:	July 31, 2017	By	/s/ Dino E. Robusto
			Dino E. Robusto
			Chief Executive Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

EXHIBIT 32.2

Written Statement of the Chief Financial Officer

of CNA Financial Corporation

Pursuant to 18 U.S.C. § 1350

(As adopted by Section 906 of the Sarbanes-Oxley Act of 2002)

The undersigned, the Chief Financial Officer of CNA Financial Corporation (the Company), hereby certifies that, to his knowledge:

• the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2017 filed on the date hereof with the Securities and Exchange Commission (the Report) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

• the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:	July 31, 2017	By	/s/ D. Craig Mense
			D. Craig Mense
			Chief Financial Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document.

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Jul. 27, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	CNA FINANCIAL CORP
Entity Central Index Key	0000021175
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		271,006,887

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Revenues
Net earned premiums	$ 1,734	$ 1,730	$ 3,379	$ 3,429
Net investment income	475	502	1,020	937
Net realized investment gains (losses):
Other-than-temporary impairment losses	(2)	(15)	(4)	(38)
Other net realized investment gains	52	31	90	18
Net realized investment gains (losses) on fixed maturity securities	50	16	86	(20)
Other revenues	107	100	211	197
Total revenues	2,366	2,348	4,696	4,543
Claims, Benefits and Expenses
Insurance claims and policyholders’ benefits	1,280	1,339	2,573	2,747
Amortization of deferred acquisition costs	312	305	617	612
Other operating expenses	364	378	710	759
Interest	40	38	83	80
Total claims, benefits and expenses	1,996	2,060	3,983	4,198
Income before income tax	370	288	713	345
Income tax expense	(98)	(79)	(181)	(70)
Net income	$ 272	$ 209	$ 532	$ 275
Basic earnings per share (dollars per share)	$ 1.01	$ 0.77	$ 1.96	$ 1.02
Diluted earnings per share (dollars per share)	1.00	0.77	1.96	1.02
Dividends per share (dollars per share)	$ 0.25	$ 0.25	$ 2.50	$ 2.50
Weighted Average Outstanding Common Stock and Common Stock Equivalents
Basic (in shares)	271.1	270.5	271.0	270.4
Diluted (in shares)	271.9	270.9	271.9	270.9

XML

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 272	$ 209	$ 532	$ 275
Other Comprehensive Income, Net of Tax
Net unrealized gains on investments with other-than-temporary impairments	0	(1)	(4)	4
Net unrealized gains on other investments	77	310	144	544
Net unrealized gains on investments	77	309	140	548
Foreign currency translation adjustment	42	(48)	53	(34)
Pension and postretirement benefits	5	5	12	11
Other comprehensive income, net of tax	124	266	205	525
Total comprehensive income	$ 396	$ 475	$ 737	$ 800

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Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Investments:
Fixed maturity securities at fair value (amortized cost of $38,668 and $38,361)	$ 41,749	$ 40,905
Equity securities at fair value (cost of $108 and $106)	118	110
Limited partnership investments	2,380	2,371
Other invested assets	42	36
Mortgage loans	646	591
Short term investments	1,333	1,407
Total investments	46,268	45,420
Cash	225	271
Reinsurance receivables (less allowance for uncollectible receivables of $38 and $37)	4,426	4,416
Insurance receivables (less allowance for uncollectible receivables of $46 and $46)	2,406	2,209
Accrued investment income	406	405
Deferred acquisition costs	647	600
Deferred income taxes	166	379
Property and equipment at cost (less accumulated depreciation of $263 and $254)	336	310
Goodwill	147	145
Other assets	1,178	1,078
Total assets	56,205	55,233
Insurance reserves:
Claim and claim adjustment expenses	22,179	22,343
Future policy benefits	10,824	10,326
Unearned premiums	4,107	3,762
Short term debt	150	0
Long term debt	2,561	2,710
Other liabilities (includes $28 and $50 due to Loews Corporation)	4,356	4,123
Total liabilities	44,177	43,264
Commitments and contingencies (Notes C and F)
Stockholders' Equity
Common stock ($2.50 par value; 500,000,000 shares authorized; 273,040,243 shares issued; 270,987,085 and 270,495,998 shares outstanding)	683	683
Additional paid-in capital	2,167	2,173
Retained earnings	9,211	9,359
Accumulated other comprehensive income (loss)	32	(173)
Treasury stock (2,053,158 and 2,544,245 shares), at cost	(65)	(73)
Total stockholders’ equity	12,028	11,969
Total liabilities and stockholders' equity	$ 56,205	$ 55,233

XML

Condensed Consolidated Balance Sheets - (Parenthetical) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Amortized cost	$ 38,668	$ 38,361
Cost	108	106
Allowance for uncollectible reinsurance	38	37
Allowance for uncollectible insurance receivables	46	46
Accumulated depreciation	263	254
Due to related parties	$ 28	$ 50
Common stock, par value (dollars per share)	$ 2.50	$ 2.50
Common stock, shares authorized (shares)	500,000,000	500,000,000
Common stock, shares issued (shares)	273,040,243	273,040,243
Common stock, shares outstanding (shares)	270,987,085	270,495,998
Treasury stock, share (shares)	2,053,158	2,544,245

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash Flows from Operating Activities
Net income	$ 532	$ 275
Adjustments to reconcile net income to net cash flows provided by operating activities:
Deferred income tax expense	122	63
Trading portfolio activity	(11)	(7)
Net realized investment (gains) losses	(86)	20
Equity method investees	42	230
Net amortization of investments	(21)	(10)
Depreciation and amortization	43	39
Changes in:
Receivables, net	(195)	(540)
Accrued investment income	1	4
Deferred acquisition costs	(41)	(25)
Insurance reserves	262	666
Other assets	(118)	(106)
Other liabilities	(45)	(27)
Other, net	30	31
Total adjustments	(17)	338
Net cash flows provided by operating activities	515	613
Dispositions:
Fixed maturity securities - sales	3,142	3,066
Fixed maturity securities - maturities, calls and redemptions	1,770	1,247
Equity securities	22	72
Limited partnerships	100	124
Mortgage loans	17	109
Purchases:
Fixed maturity securities	(4,840)	(4,874)
Equity securities	(8)	0
Limited partnerships	(47)	(206)
Mortgage loans	(72)	(41)
Change in other investments	(3)	11
Change in short term investments	81	281
Purchases of property and equipment	(68)	(65)
Disposals of property and equipment	0	107
Other, net	17	2
Net cash flows provided (used) by investing activities	111	(167)
Cash Flows from Financing Activities
Dividends paid to common stockholders	(676)	(677)
Proceeds from the issuance of debt	0	498
Repayment of debt	0	(358)
Other, net	(1)	(1)
Net cash flows used by financing activities	(677)	(538)
Effect of foreign exchange rate changes on cash	5	(6)
Net change in cash	(46)	(98)
Cash, beginning of year	271	387
Cash, end of period	$ 225	$ 289

XML

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Millions	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	AOCI Attributable to Parent	Treasury Stock
Balance, beginning of year at Dec. 31, 2015		$ 683	$ 2,153	$ 9,313	$ (315)	$ (78)
Stock-based compensation			2			5
Dividends paid to common stockholders				(677)
Net income	$ 275			275
Other comprehensive income	525				525
Balance, end of period at Jun. 30, 2016	11,886	683	2,155	8,911	210	(73)
Balance, beginning of year at Mar. 31, 2016					(56)
Net income	209
Other comprehensive income	266
Balance, end of period at Jun. 30, 2016	11,886	683	2,155	8,911	210	(73)
Balance, beginning of year at Dec. 31, 2016	11,969	683	2,173	9,359	(173)	(73)
Stock-based compensation			(6)			8
Dividends paid to common stockholders				(680)
Net income	532			532
Other comprehensive income	205				205
Balance, end of period at Jun. 30, 2017	12,028	683	2,167	9,211	32	(65)
Balance, beginning of year at Mar. 31, 2017					(92)
Net income	272
Other comprehensive income	124
Balance, end of period at Jun. 30, 2017	$ 12,028	$ 683	$ 2,167	$ 9,211	$ 32	$ (65)

XML

General

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

General

General

Basis of Presentation

The Condensed Consolidated Financial Statements include the accounts of CNA Financial Corporation (CNAF) and its subsidiaries. Collectively, CNAF and its subsidiaries are referred to as CNA or the Company. Loews Corporation (Loews) owned approximately 90% of the outstanding common stock of CNAF as of June 30, 2017.

The accompanying Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Intercompany amounts have been eliminated. Certain financial information that is normally included in annual financial statements prepared in accordance with GAAP, including certain financial statement notes, is not required for interim reporting purposes and has been condensed or omitted. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in CNAF's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2016, including the summary of significant accounting policies in Note A. The preparation of Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.

The interim financial data as of June 30, 2017 and for the three and six months ended June 30, 2017 and 2016 is unaudited. However, in the opinion of management, the interim data includes all adjustments, including normal recurring adjustments, necessary for a fair statement of the Company's results for the interim periods. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.

Recently Adopted Accounting Standards Updates (ASU)

In March 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvementsto Employee Share-Based Payment Accounting. The updated accounting guidance simplifies the accounting for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. As of January 1, 2017, the Company adopted the updated accounting guidanceand began recognizing excess tax benefits or deficiencies on vesting or settlement of awards as an income tax benefit or expense within net income, instead of additional paid-in capital as required under previous guidance. The related cash flows are now classified within operating activities. As a result of this change, excess tax benefits are no longer included in assumed proceeds under the treasury stock method of calculating earnings per share. The impact of the accounting change resulted in a decrease of $0 million and $3 million to income tax expense for the three and six months ended June 30, 2017.

Accounting Standards Pending Adoption

In May 2014, the FASB issued ASU No. 2014-09, Revenue Recognition (Topic 606): Revenue from Contracts with Customers. The standard excludes from its scope the accounting for insurance contracts, financial instruments, and certain other agreements that are governed under other GAAP guidance. The updated guidance requires an entity to recognize revenue as performance obligations are met, in an amount that reflects the consideration the entity is entitled to receive for the transfer of the promised goods or services. The standard is effective for interim and annual reporting periods beginning after December 15, 2017 and may be applied retrospectively or through a cumulative effect adjustment to retained earnings at the date of adoption. As insurance contracts are out of scope, the Company anticipates the primary change will be to revenue recognition for certain of our warranty products and services. The Company has not made a decision on the method of adoption and is currently evaluating the effect the updated guidance will have on the Company’s financial statements, but we do not currently believe ASU 2014-09 will have a material effect on the Company's results of operations or financial position.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The updated accounting guidance requires changes to the reporting model for financial instruments. The guidance is effective for interim and annual periods beginning after December 15, 2017. The Company expects the primary change to be the requirement for equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. The updated accounting guidance requires lessees to recognize on the balance sheet the assets and liabilities for the rights and obligations created by all leases, including those historically accounted for as operating leases. The guidance is effective for interim and annual periods beginning after December 15, 2018. The Company is currently evaluating the effect the updated guidance will have on the Company's financial statements. It is expected that assets and liabilities will increase based on the present value of remaining lease payments for leases in place at the adoption date; however, this is not expected to be material to the Company's results of operations or financial position.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurementof Credit Losses on Financial Instruments. The updated accounting guidance requires changes to the recognition of credit losses on financial instruments not accounted for at fair value through net income. The guidance is effective for interim and annual periods beginning after December 15, 2019. The Company is currently evaluating the effect the guidance will have on the Company's financial statements, but expects the primary changes to be the use of the expected credit loss model for its mortgage loan portfolio and reinsurance receivables and the presentation of credit losses within the available-for-sale fixed maturities portfolio through an allowance method rather than as a direct write-down. The expected credit loss model will require a financial asset to be presented at the net amount expected to be collected. The allowance method for available-for-sale debt securities will allow the Company to record reversals of credit losses if the estimate of credit losses declines.

In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The updated accounting guidance requires changes to the presentation of the components of net periodic benefit cost on the income statement by requiring service cost to be presented with other employee compensation costs and other components of net periodic pension cost to be presented outside of any subtotal of operating income. The ASU also stipulates that only the service cost component of net benefit cost is eligible for capitalization. The guidance is effective for interim and annual periods beginning after December 15, 2017. The Company is currently evaluating the effect the guidance will have on the Company's financial statements.

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Earnings Per Share

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

Earnings per share is based on the weighted average number of outstanding common shares. Basic earnings (loss) per share excludes the effect of dilutive securities and is computed by dividing Net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.

For the three and six months ended June 30,2017, approximately 847 thousand and 915 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were included in the calculation of diluted earnings per share. For those same periods, less than 1 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were not included in the calculation of diluted earnings per share, because the effect would have been antidilutive.

For the three and six months ended June 30,2016, approximately 409 thousand and 473 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were included in the calculation of diluted earnings per share. For those same periods, approximately 178 thousand and 180 thousand potential shares attributable to exercises or conversions into common stock under stock-based employee compensation plans were not included in the calculation of diluted earnings per share, because the effect would have been antidilutive.

XML

Investments

6 Months Ended

Jun. 30, 2017

Investments [Abstract]

Investments

Investments

The significant components of Net investment income are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Fixed maturity securities	$	457		$	449		$	912		$	895
Equity securities	2			4			3			7
Limited partnership investments	16			46			106			32
Mortgage loans	8			13			15			22
Short term investments	3			1			6			4
Trading portfolio	4			4			6			6
Other	—			—			1			—
Gross investment income	490			517			1,049			966
Investment expense	(15		)	(15		)	(29		)	(29		)
Net investment income	$	475		$	502		$	1,020		$	937

Net realized investment gains (losses) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	56		$	40		$	105		$	85
Gross realized losses	(12		)	(24		)	(29		)	(86		)
Net realized investment gains (losses) on fixed maturity securities	44			16			76			(1		)
Equity securities:
Gross realized gains	1			4			1			4
Gross realized losses	(1		)	(1		)	(1		)	(6		)
Net realized investment gains (losses) on equity securities	—			3			—			(2		)
Derivatives	(3		)	(6		)	(2		)	(13		)
Short term investments and other	9			3			12			(4		)
Net realized investment gains (losses)	$	50		$	16		$	86		$	(20	)

Net realized investment losses for the six months ended June 30, 2016 include $8 million related to the first quarter 2016 redemption of the Company's $350 million senior notes due August 2016.

The components of Other-than-temporary impairment (OTTI) losses recognized in earnings by asset type are presented in the following table.

Periods ended June 30	Three Months				Six Months
(In millions)	2017		2016		2017		2016
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	2	$	13	$	4	$	29
Asset-backed:
Residential mortgage-backed	—		1		—		1
Other asset-backed	—		1		—		3
Total asset-backed	—		2		—		4
Total fixed maturity securities available-for-sale	2		15		4		33
Equity securities available-for-sale -- Common stock	—		—		—		5
OTTI losses recognized in earnings	$	2	$	15	$	4	$	38

The following tables present a summary of fixed maturity and equity securities.

June 30, 2017	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,823	$	1,589	$	29	$	19,383	$	—
States, municipalities and political subdivisions	12,461		1,380		15		13,826		(13		)
Asset-backed:
Residential mortgage-backed	4,835		124		38		4,921		(27		)
Commercial mortgage-backed	1,907		59		14		1,952		—
Other asset-backed	1,050		16		5		1,061		—
Total asset-backed	7,792		199		57		7,934		(27		)
U.S. Treasury and obligations of government-sponsored enterprises	113		4		2		115		—
Foreign government	438		12		1		449		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,645		3,185		104		41,726		$	(40	)
Total fixed maturity securities trading	23						23
Equity securities available-for-sale:
Common stock	17		5		—		22
Preferred stock	91		6		1		96
Total equity securities available-for-sale	108		11		1		118
Total	$	38,776	$	3,196	$	105	$	41,867

December 31, 2016	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,711	$	1,323	$	76	$	18,958	$	(1	)
States, municipalities and political subdivisions	12,060		1,213		33		13,240		(16		)
Asset-backed:
Residential mortgage-backed	5,004		120		51		5,073		(28		)
Commercial mortgage-backed	2,016		48		24		2,040		—
Other asset-backed	1,022		8		5		1,025		—
Total asset-backed	8,042		176		80		8,138		(28		)
U.S. Treasury and obligations of government-sponsored enterprises	83		10		—		93		—
Foreign government	435		13		3		445		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,349		2,736		192		40,893		$	(45	)
Total fixed maturity securities trading	12						12
Equity securities available-for-sale:
Common stock	13		6		—		19
Preferred stock	93		2		4		91
Total equity securities available-for-sale	106		8		4		110
Total	$	38,467	$	2,744	$	196	$	41,015

The net unrealized gains on investments included in the tables above are recorded as a component of Accumulated other comprehensive income (AOCI). When presented in AOCI, these amounts are net of tax and any required Shadow Adjustments. To the extent that unrealized gains on fixed income securities supporting certain products within the Life & Group Non-Core segment would result in a premium deficiency if realized, a related increase in Insurance reserves is recorded, net of tax, as a reduction of net unrealized gains through Other comprehensive income (loss) (Shadow Adjustments). As of June 30, 2017 and December 31, 2016, the net unrealized gains on investments included in AOCI were correspondingly reduced by Shadow Adjustments of $1,221 million and $1,014 million.

The following tables present the estimated fair value and gross unrealized losses of fixed maturity and equity securities in a gross unrealized loss position by the length of time in which the securities have continuously been in that position.

	Less than 12 Months				12 Months or Longer				Total
June 30, 2017	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	1,314	$	26	$	52	$	3	$	1,366	$	29
States, municipalities and political subdivisions	742		15		24		—		766		15
Asset-backed:
Residential mortgage-backed	1,722		34		141		4		1,863		38
Commercial mortgage-backed	473		8		125		6		598		14
Other asset-backed	159		4		14		1		173		5
Total asset-backed	2,354		46		280		11		2,634		57
U.S. Treasury and obligations of government-sponsored enterprises	65		2		—		—		65		2
Foreign government	109		1		—		—		109		1
Total fixed maturity securities available-for-sale	4,584		90		356		14		4,940		104
Equity securities available-for-sale:
Common stock	1		—		—		—		1		—
Preferred stock	15		1		—		—		15		1
Total equity securities available-for-sale	16		1		—		—		16		1
Total	$	4,600	$	91	$	356	$	14	$	4,956	$	105

	Less than 12 Months				12 Months or Longer				Total
December 31, 2016	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	2,615	$	61	$	254	$	15	$	2,869	$	76
States, municipalities and political subdivisions	959		32		23		1		982		33
Asset-backed:
Residential mortgage-backed	2,136		44		201		7		2,337		51
Commercial mortgage-backed	756		22		69		2		825		24
Other asset-backed	398		5		24		—		422		5
Total asset-backed	3,290		71		294		9		3,584		80
U.S. Treasury and obligations of government-sponsored enterprises	5		—		—		—		5		—
Foreign government	108		3		—		—		108		3
Total fixed maturity securities available-for-sale	6,977		167		571		25		7,548		192
Equity securities available-for-sale -- Preferred stock	12		—		13		4		25		4
Total	$	6,989	$	167	$	584	$	29	$	7,573	$	196

Based on current facts and circumstances, the Company believes the unrealized losses presented in the June 30, 2017 securities in a gross unrealized loss position table above are not indicative of the ultimate collectibility of the current amortized cost of the securities, but rather are attributable to changes in interest rates, credit spreads and other factors. The Company has no current intent to sell securities with unrealized losses, nor is it more likely than not that it will be required to sell prior to recovery of amortized cost; accordingly, the Company has determined that there are no additional OTTI losses to be recorded as of June 30, 2017.

The following table presents the activity related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held as of June 30, 2017 and 2016 for which a portion of an OTTI loss was recognized in Other comprehensive income (loss).

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Beginning balance of credit losses on fixed maturity securities	$	32		$	48		$	36		$	53
Reductions for securities sold during the period	(2		)	(7		)	(6		)	(12		)
Ending balance of credit losses on fixed maturity securities	$	30		$	41		$	30		$	41

Contractual Maturity

The following table presents available-for-sale fixed maturity securities by contractual maturity.

	June 30, 2017				December 31, 2016
(In millions)	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,590	$	1,628	$	1,779	$	1,828
Due after one year through five years	7,732		8,098		7,566		7,955
Due after five years through ten years	15,754		16,404		15,892		16,332
Due after ten years	13,569		15,596		13,112		14,778
Total	$	38,645	$	41,726	$	38,349	$	40,893

Actual maturities may differ from contractual maturities because certain securities may be called or prepaid. Securities not due at a single date are allocated based on weighted average life.

Derivative Financial Instruments

The Company holds an embedded derivative on a funds withheld liability with a notional value of $171 million and $174 million as of June 30, 2017 and December 31, 2016 and a fair value of $(1) million and $3 million as of June 30, 2017 and December 31, 2016. The embedded derivative on the funds withheld liability is accounted for separately and reported with the funds withheld liability in Other liabilities on the Condensed Consolidated Balance Sheets.

Investment Commitments

As of June 30, 2017, the Company had committed approximately $415 million to future capital calls from various third-party limited partnership investments in exchange for an ownership interest in the related partnerships.

As of June 30, 2017, the Company had mortgage loan commitments of $39 million representing signed loan applications received and accepted.

The Company invests in various privately placed debt securities, including bank loans, as part of its overall investment strategy and has committed to additional future purchases, sales and funding. Purchases and sales of privately placed debt securities are recorded once funded. As of June 30, 2017, the Company had commitments to purchase or fund additional amounts of $196 million and sell $165 million under the terms of such securities.

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Fair Value

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1, as these are the most transparent or reliable.

Level 1 - Quoted prices for identical instruments in active markets.

Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.

Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are not observable.

Prices may fall within Level 1, 2 or 3 depending upon the methodology and inputs used to estimate fair value for each specific security. In general, the Company seeks to price securities using third-party pricing services. Securities not priced by pricing services are submitted to independent brokers for valuation and, if those are not available, internally developed pricing models are used to value assets using a methodology and inputs the Company believes market participants would use to value the assets. Prices obtained from third-party pricing services or brokers are not adjusted by the Company.

The Company performs control procedures over information obtained from pricing services and brokers to ensure prices received represent a reasonable estimate of fair value and to confirm representations regarding whether inputs are observable or unobservable. Procedures may include i) the review of pricing service methodologies or broker pricing qualifications, ii) back-testing, where past fair value estimates are compared to actual transactions executed in the market on similar dates, iii) exception reporting, where period-over-period changes in price are reviewed and challenged with the pricing service or broker based on exception criteria, iv) deep dives, where the Company performs an independent analysis of the inputs and assumptions used to price individual securities and v) pricing validation, where prices received are compared to prices independently estimated by the Company.

Assets and Liabilities Measured at Fair Value

Assets and liabilities measured at fair value on a recurring basis are presented in the following tables.

June 30, 2017							Total Assets/Liabilities at Fair Value
(In millions)	Level 1		Level 2		Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	—	$	19,306	$	100	$	19,406
States, municipalities and political subdivisions	—		13,825		1		13,826
Asset-backed:
Residential mortgage-backed	—		4,798		123		4,921
Commercial mortgage-backed	—		1,939		13		1,952
Other asset-backed	—		979		82		1,061
Total asset-backed	—		7,716		218		7,934
U.S. Treasury and obligations of government-sponsored enterprises	115		—		—		115
Foreign government	—		449		—		449
Redeemable preferred stock	19		—		—		19
Total fixed maturity securities	134		41,296		319		41,749
Equity securities	99		—		19		118
Other invested assets	—		5		—		5
Short term investments	260		981		—		1,241
Life settlement contracts, included in Other assets	—		—		1		1
Total assets	$	493	$	42,282	$	339	$	43,114
Liabilities
Other liabilities	$	—	$	1	$	—	$	1
Total liabilities	$	—	$	1	$	—	$	1

December 31, 2016								Total Assets/Liabilities at Fair Value
(In millions)	Level 1		Level 2			Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	—	$	18,840		$	130	$	18,970
States, municipalities and political subdivisions	—		13,239			1		13,240
Asset-backed:
Residential mortgage-backed	—		4,944			129		5,073
Commercial mortgage-backed	—		2,027			13		2,040
Other asset-backed	—		968			57		1,025
Total asset-backed	—		7,939			199		8,138
U.S. Treasury and obligations of government-sponsored enterprises	93		—			—		93
Foreign government	—		445			—		445
Redeemable preferred stock	19		—			—		19
Total fixed maturity securities	112		40,463			330		40,905
Equity securities	91		—			19		110
Other invested assets	—		5			—		5
Short term investments	475		853			—		1,328
Life settlement contracts, included in Other assets	—		—			58		58
Total assets	$	678	$	41,321		$	407	$	42,406
Liabilities
Other liabilities	$	—	$	(3	)	$	—	$	(3	)
Total liabilities	$	—	$	(3	)	$	—	$	(3	)

The tables below present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

Level 3 (In millions)	Balance as of April 1, 2017		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)		Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2017		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2017 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	121	$	—	$	—	$	—	$	—		$	(11	)	$	—	$	(10	)	$	100	$	—
States, municipalities and political subdivisions	1		—		—		—		—			—			—		—			1		—
Asset-backed:
Residential mortgage-backed	126		1		1		—		—			(5		)	—		—			123		—
Commercial mortgage-backed	13		—		—		—		—			—			—		—			13		—
Other asset-backed	117		—		—		13		—			(2		)	24		(70		)	82		—
Total asset-backed	256		1		1		13		—			(7		)	24		(70		)	218		—
Total fixed maturity securities	378		1		1		13		—			(18		)	24		(80		)	319		—
Equity securities	19		—		1		—		(1		)	—			—		—			19		—
Life settlement contracts	46		—		—		—		(45		)	—			—		—			1		—
Total	$	443	$	1	$	2	$	13	$	(46	)	$	(18	)	$	24	$	(80	)	$	339	$	—

Level 3 (In millions)	Balance as of April 1, 2016		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2016		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2016 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	193	$	1	$	3		$	94	$	(20	)	$	(7	)	$	—	$	(22	)	$	242	$	—
States, municipalities and political subdivisions	2		—		—			—		—			—			—		—			2		—
Asset-backed:
Residential mortgage-backed	128		1		(1		)	10		—			(4		)	—		—			134		—
Commercial mortgage-backed	27		—		—			—		—			(9		)	3		(10		)	11		—
Other asset-backed	50		—		2			35		(25		)	(1		)	—		(16		)	45		—
Total asset-backed	205		1		1			45		(25		)	(14		)	3		(26		)	190		—
Total fixed maturity securities	400		2		4			139		(45		)	(21		)	3		(48		)	434		—
Equity securities	19		—		—			—		—			—			—		—			19		—
Life settlement contracts	72		6		—			—		—			(11		)	—		—			67		(3		)
Total	$	491	$	8	$	4		$	139	$	(45	)	$	(32	)	$	3	$	(48	)	$	520	$	(3	)

Level 3 (In millions)	Balance as of January 1, 2017		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*			Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)		Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2017		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2017 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	130	$	—		$	1	$	5	$	(1	)	$	(25	)	$	—	$	(10	)	$	100	$	—
States, municipalities and political subdivisions	1		—			—		—		—			—			—		—			1		—
Asset-backed:
Residential mortgage-backed	129		2			3		—		—			(11		)	—		—			123		—
Commercial mortgage-backed	13		—			—		—		—			—			—		—			13		—
Other asset-backed	57		(1		)	—		51		—			(2		)	52		(75		)	82		—
Total asset-backed	199		1			3		51		—			(13		)	52		(75		)	218		—
Total fixed maturity securities	330		1			4		56		(1		)	(38		)	52		(85		)	319		—
Equity securities	19		—			2		1		(3		)	—			—		—			19		—
Derivative financial instruments	—		1			—		—		(1		)	—			—		—			—		—
Life settlement contracts	58		6			—		—		(58		)	(5		)	—		—			1		—
Total	$	407	$	8		$	6	$	57	$	(63	)	$	(43	)	$	52	$	(85	)	$	339	$	—

Level 3 (In millions)	Balance as of January 1, 2016		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2016		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2016 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	168	$	—	$	7		$	147	$	(36	)	$	(10	)	$	—	$	(34	)	$	242	$	—
States, municipalities and political subdivisions	2		—		—			—		—			—			—		—			2		—
Asset-backed:
Residential mortgage-backed	134		2		(1		)	10		—			(9		)	—		(2		)	134		—
Commercial mortgage-backed	22		—		—			9		—			(9		)	3		(14		)	11		—
Other asset-backed	53		—		2			35		(25		)	(1		)	2		(21		)	45		—
Total asset-backed	209		2		1			54		(25		)	(19		)	5		(37		)	190		—
Total fixed maturity securities	379		2		8			201		(61		)	(29		)	5		(71		)	434		—
Equity securities	20		—		(1		)	—		—			—			—		—			19		—
Life settlement contracts	74		10		—			—		—			(17		)	—		—			67		(3		)
Total	$	473	$	12	$	7		$	201	$	(61	)	$	(46	)	$	5	$	(71	)	$	520	$	(3	)

*Net realized and unrealized gains and losses from Level 3 securities and derivatives are reported in Net income (loss) as follows:

Major Category of Assets and Liabilities	Condensed Consolidated Statements of Operations Line Items
Fixed maturity securities available-for-sale (1)	Net realized investment gains (losses)
Fixed maturity securities trading	Net investment income
Equity securities (1)	Net realized investment gains (losses)
Other invested assets - Derivative financial instruments held in a trading portfolio	Net investment income
Other invested assets - Derivative financial instruments not held in a trading portfolio	Net realized investment gains (losses)
Life settlement contracts	Other revenues
Other liabilities - Derivative financial instruments	Net realized investment gains (losses)

(1) Unrealized gains and losses are reported within AOCI.

Securities may be transferred in or out of levels within the fair value hierarchy based on the availability of observable market information and quoted prices used to determine the fair value of the security. The availability of observable market information and quoted prices varies based on market conditions and trading volume. During the three and six months ended June 30, 2017 and 2016, there were no transfers between Level 1 and Level 2. The Company's policy is to recognize transfers between levels at the beginning of quarterly reporting periods.

Valuation Methodologies and Inputs

The following section describes the valuation methodologies and relevant inputs used to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which the instruments are generally classified.

Fixed Maturity Securities

Level 1 securities include highly liquid and exchange traded bonds and redeemable preferred stock, valued using quoted market prices. Level 2 securities include most other fixed maturity securities as the significant inputs are observable in the marketplace. All classes of Level 2 fixed maturity securities are valued using a methodology based on information generated by market transactions involving identical or comparable assets, a discounted cash flow methodology, or a combination of both when necessary. Common inputs for all classes of fixed maturity securities include prices from recently executed transactions of similar securities, marketplace quotes, benchmark yields, spreads off benchmark yields, interest rates and U.S. Treasury or swap curves. Specifically for asset-backed securities, key inputs include prepayment and default projections based on past performance of the underlying collateral and current market data. Fixed maturity securities are primarily assigned to Level 3 in cases where broker/dealer quotes are significant inputs to the valuation, and there is a lack of transparency as to whether these quotes are based on information that is observable in the marketplace. Level 3 securities also include private placement debt securities whose fair value is determined using internal models with inputs that are not market observable.

Equity Securities

Level 1 equity securities include publicly traded securities valued using quoted market prices. Level 2 securities are primarily non-redeemable preferred stocks and common stocks valued using pricing for similar securities, recently executed transactions and other pricing models utilizing market observable inputs. Level 3 securities are primarily priced using broker/dealer quotes and internal models with inputs that are not market observable.

Other Invested Assets

The fair value of Federal Home Loan Bank of Chicago (FHLBC) stock is equal to par because it can only be redeemed by the FHLBC at par or sold to another member of the FHLBC at par and is classified as Level 2.

As of June 30, 2017 and December 31, 2016, there were approximately $37 million and $31 million respectively of overseas deposits within other invested assets, which can be redeemed at net asset value in 90 days or less. Overseas deposits are excluded from the fair value hierarchy, because their fair value is recorded using the net asset value per share (or equivalent) practical expedient.

Short Term Investments

Securities that are actively traded or have quoted prices are classified as Level 1. These securities include money market funds and treasury bills. Level 2 primarily includes commercial paper, for which all inputs are market observable. Fixed maturity securities purchased within one year of maturity are classified consistent with fixed maturity securities discussed above. Short term investments as presented in the tables above differ from the amounts presented on the Condensed Consolidated Balance Sheets because certain short term investments, such as time deposits, are not measured at fair value.

Life Settlement Contracts

The Company accounts for its investment in life settlement contracts using the fair value method. Historically, the fair value of life settlement contracts was determined as the present value of the anticipated death benefits less anticipated premium payments based on contract terms that are distinct for each insured, as well as the Company's own assumptions for mortality, premium expense and the rate of return that a buyer would require on the contracts.

The entire portfolio of life settlement contracts, which is included within the Life and Group Non-Core segment, was determined to be held for sale as of December 31, 2016 as the Company reached an agreement on terms to sell the portfolio. As such, the Company adjusted the fair value to the estimated sales proceeds less cost to sell. The definitive Purchase and Sale Agreement (PSA) related to the portfolio was executed on March 7, 2017 (sale date). In connection therewith, the life settlement contracts and related sale proceeds were placed in escrow until the buyer is recognized as the owner and beneficiary of each individual life settlement contract by the life insurance company that issued the policy. All but $1 million of the contracts have been released from escrow as of June 30, 2017. The Company derecognized the released contracts and recorded the consideration, including a note receivable, which is payable over three years and is carried at amortized cost less any valuation allowance. The note receivable of $45 million is included within Other assets on the June 30, 2017 Condensed Consolidated Balance Sheet and interest income is accreted to the principal balance of the note receivable. The contracts remaining in escrow have not been derecognized, continue to be measured at the fair value per the PSA, and are expected to clear escrow in the third quarter of 2017.

The fair value of the Company's investments in life settlement contracts were $1 million and $58 million as of June 30, 2017 and December 31, 2016, and are included in Other assets on the Condensed Consolidated Balance Sheets. Despite the sale, the contracts have been classified as Level 3 as there is not an active market for life settlement contracts. The cash receipts and payments related to the life settlement contracts prior to the sale date are included in Cash Flows from operating activities on the Condensed Consolidated Statements of Cash Flows. Cash receipts related to the sale of the life settlement contracts, as well as principal payments on the note receivable, are included in Cash Flows from investing activities.

Derivative Financial Investments

Level 2 securities primarily include the embedded derivative on the funds withheld liability. The embedded derivative on funds withheld liability is valued using the change in fair value of the assets supporting the funds withheld liability, which are fixed maturity securities valued with observable inputs.

Significant Unobservable Inputs

The following tables present quantitative information about the significant unobservable inputs utilized by the Company in the fair value measurements of Level 3 assets. Valuations for assets and liabilities not presented in the tables below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company. The valuation of life settlement contracts was based on the terms of the sale of the contracts to a third party; therefore, the contracts are not included in the table below.

June 30, 2017	Estimated Fair Value (In millions)		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	125	Discounted cash flow	Credit spread	2% - 40% (4%)

December 31, 2016	Estimated Fair Value (In millions)		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	106	Discounted cash flow	Credit spread	2% - 40% (4%)

For fixed maturity securities, an increase to the credit spread assumptions would result in a lower fair value measurement.

Financial Assets and Liabilities Not Measured at Fair Value

The carrying amount and estimated fair value of the Company's financial assets and liabilities which are not measured at fair value on the Condensed Consolidated Balance Sheets are presented in the following tables.

June 30, 2017	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Assets
Mortgage loans	$	646	$	—	$	—	$	655	$	655
Note receivable	45		—		—		45		45
Liabilities
Short term debt	$	150	$	—	$	154	$	—	$	154
Long term debt	2,561		—		2,819		—		2,819

December 31, 2016	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Assets
Mortgage loans	$	591	$	—	$	—	$	594	$	594
Liabilities
Long term debt	$	2,710	$	—	$	2,952	$	—	$	2,952

The following methods and assumptions were used to estimate the fair value of these financial assets and liabilities.

The fair values of mortgage loans were based on the present value of the expected future cash flows discounted at the current interest rate for origination of similar quality loans, adjusted for specific loan risk.

The fair value of the note receivable was based on the present value of the expected future cash flows discounted at the current interest rate for origination of similar notes, adjusted for specific credit risk.

The Company's senior notes and debentures were valued based on observable market prices. The fair value for other debt was estimated using discounted cash flows based on current incremental borrowing rates for similar borrowing arrangements.

The carrying amounts reported on the Condensed Consolidated Balance Sheets for Cash, Short term investments not carried at fair value, Accrued investment income and certain Other assets and Other liabilities approximate fair value due to the short term nature of these items. These assets and liabilities are not listed in the tables above.

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Claim and Claim Adjustment Expense Reserves

6 Months Ended

Jun. 30, 2017

Liability for Claims and Claims Adjustment Expense [Abstract]

Claim and Claim Adjustment Expense Reserves

Claim and Claim Adjustment Expense Reserves

The Company's property and casualty insurance claim and claim adjustment expense reserves represent the estimated amounts necessary to resolve all outstanding claims, including incurred but not reported (IBNR) claims as of the reporting date. The Company's reserve projections are based primarily on detailed analysis of the facts in each case, the Company's experience with similar cases and various historical development patterns. Consideration is given to such historical patterns as claim reserving trends and settlement practices, loss payments, pending levels of unpaid claims and product mix, as well as court decisions, economic conditions, including inflation, and public attitudes. All of these factors can affect the estimation of claim and claim adjustment expense reserves.

Establishing claim and claim adjustment expense reserves, including claim and claim adjustment expense reserves for catastrophic events that have occurred, is an estimation process. Many factors can ultimately affect the final settlement of a claim and, therefore, the necessary reserve. Changes in the law, results of litigation, medical costs, the cost of repair materials and labor rates can all affect ultimate claim costs. In addition, time can be a critical part of reserving determinations since the longer the span between the incidence of a loss and the payment or settlement of the claim, the more variable the ultimate settlement amount can be. Accordingly, short-tail claims, such as property damage claims, tend to be more reasonably estimable than long-tail claims, such as workers' compensation, general liability and professional liability claims. Adjustments to prior year reserve estimates, if necessary, are reflected in the results of operations in the period that the need for such adjustments is determined. There can be no assurance that the Company's ultimate cost for insurance losses will not exceed current estimates.

Catastrophes are an inherent risk of the property and casualty insurance business and have contributed to material period-to-period fluctuations in the Company's results of operations and/or equity. The Company reported catastrophe losses, net of reinsurance, of $39 million and $73 million for the three and six months ended June 30, 2017. Catastrophe losses in 2017 resulted primarily from U.S. weather-related events. The Company reported catastrophe losses, net of reinsurance, of $85 million and $121 million for the three and six months ended June 30, 2016. Catastrophe losses in 2016 resulted primarily from U.S. weather-related events and the Fort McMurray wildfires.

Liability for Unpaid Claim and Claim Adjustment Expenses Rollforward

The following table presents a reconciliation between beginning and ending claim and claim adjustment expense reserves, including claim and claim adjustment expense reserves of the Life & Group Non-Core segment.

For the six months ended June 30
(In millions)	2017			2016
Reserves, beginning of year:
Gross	$	22,343		$	22,663
Ceded	4,094			4,087
Net reserves, beginning of year	18,249			18,576
Net incurred claim and claim adjustment expenses:
Provision for insured events of current year	2,443			2,583
Decrease in provision for insured events of prior years	(159		)	(198		)
Amortization of discount	93			93
Total net incurred (1)	2,377			2,478
Net payments attributable to:
Current year events	(266		)	(311		)
Prior year events	(2,331		)	(2,185		)
Total net payments	(2,597		)	(2,496		)
Foreign currency translation adjustment and other	70			46
Net reserves, end of period	18,099			18,604
Ceded reserves, end of period	4,080			4,371
Gross reserves, end of period	$	22,179		$	22,975

(1) Total net incurred above does not agree to Insurance claims and policyholders' benefits as reflected on the Condensed Consolidated Statements of Operations due to amounts related to retroactive reinsurance deferred gain accounting, uncollectible reinsurance and loss deductible receivables, and benefit expenses related to future policy benefits, which are not reflected in the table above.

Net Prior Year Development

Changes in estimates of claim and allocated claim adjustment expense reserves and premium accruals, net of reinsurance, for prior years are defined as net prior year development. These changes can be favorable or unfavorable. The following tables and discussion present the net prior year development recorded for Specialty, Commercial, International and Corporate & Other Non-Core segments.

Three months ended June 30, 2017
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(23	)	$	(34	)	$	2		$	—	$	(55	)
Pretax (favorable) unfavorable premium development	(5		)	1			(4		)	—		(8		)
Total pretax (favorable) unfavorable net prior year development	$	(28	)	$	(33	)	$	(2	)	$	—	$	(63	)

Three months ended June 30, 2016
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(65	)	$	(18	)	$	(15	)	$	—	$	(98	)
Pretax (favorable) unfavorable premium development	(7		)	(2		)	1			—		(8		)
Total pretax (favorable) unfavorable net prior year development	$	(72	)	$	(20	)	$	(14	)	$	—	$	(106	)

Six months ended June 30, 2017
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(54	)	$	(58	)	$	—		$	—	$	(112	)
Pretax (favorable) unfavorable premium development	(10		)	38			(11		)	—		17
Total pretax (favorable) unfavorable net prior year development	$	(64	)	$	(20	)	$	(11	)	$	—	$	(95	)

Six months ended June 30, 2016
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(99	)	$	(32	)	$	(19	)	$	—	$	(150	)
Pretax (favorable) unfavorable premium development	(18		)	(4		)	—			—		(22		)
Total pretax (favorable) unfavorable net prior year development	$	(117	)	$	(36	)	$	(19	)	$	—	$	(172	)

Premium development can occur in the property and casualty business when there is a change in exposure on auditable policies or when premium accruals differ from processed premium.  Audits on policies usually occur in a period after the expiration date of the policy. See further information on the premium development in the Commercial segment for the three and six months ended June 30, 2017 within Note F.

Specialty

The following table presents further detail of the net prior year claim and allocated claim adjustment expense reserve development (development) recorded for the Specialty segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Medical Professional Liability	$	3		$	(23	)	$	4		$	(30	)
Other Professional Liability and Management Liability	(37		)	(41		)	(69		)	(50		)
Surety	—			—			—			—
Warranty	6			3			6			5
Other	5			(4		)	5			(24		)
Total pretax (favorable) unfavorable development	$	(23	)	$	(65	)	$	(54	)	$	(99	)

Three Months

2017

Favorable development in other professional liability and management liability was primarily due to lower than expected claim frequency in accident years 2013 through 2015 and lower than expected severity in accident years 2014 through 2016 for professional liability.

2016

Favorable development in medical professional liability was due to lower than expected severity for individual healthcare professionals and allied facilities for accident years 2014 and prior.

Favorable development in other professional liability and management liability was primarily related to lower than expected frequency of claims in accident years 2010 through 2015, mainly driven by professional services. This was partially offset by unfavorable development in accident year 2015 related to an increase in management liability frequency of larger claims.

Six Months

2017

Favorable development in other professional liability and management liability was primarily due to favorable settlements on closed claims and a lower frequency of large losses for accident years 2011 through 2016 for professional and management liability, lower than expected claim frequency in accident years 2013 through 2015 for professional liability and lower than expected severity in accident years 2014 through 2016 for professional liability.

2016

Favorable development for medical professional liability was primarily due to lower than expected severity for individual healthcare professionals, allied facilities, and hospitals in accident years 2011 and prior. This was partially offset by unfavorable development in accident years 2012 and 2013 related to higher than expected large loss emergence in hospitals and higher than expected severity in accident years 2014 and 2015 in our aging services business.

Favorable development in other professional liability and management liability was primarily related to lower than expected frequency of claims in accident years 2010 through 2015, mainly driven by professional services. Additional favorable development was related to favorable outcomes on larger claims in 2013 and prior in professional services. This was partially offset by unfavorable development in accident years 2014 and 2015 related to an increase in management liability frequency of larger claims.

Favorable development for other coverages was due to better than expected claim frequency in property coverages provided to Specialty customers in accident year 2015.

Commercial

The following table presents further detail of the development recorded for the Commercial segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Commercial Auto	$	—		$	(20	)	$	(26	)	$	(35	)
General Liability	(1		)	(37		)	(1		)	(52		)
Workers' Compensation	(46		)	50			(46		)	54
Property and Other	13			(11		)	15			1
Total pretax (favorable) unfavorable development	$	(34	)	$	(18	)	$	(58	)	$	(32	)

Three Months

2017

Favorable development for workers’ compensation was primarily related to decreases in frequency and severity in recent accident years, partially attributable to California reforms related to decreases in medical costs.

Unfavorable development for property and other was primarily due to higher than expected severity in accident year 2016.

2016

Favorable development for commercial auto was primarily due to favorable settlements on claims in accident years 2010 through 2014.

Favorable development for general liability was primarily due to better than expected claim settlements in accident years 2012 through 2014 and better than expected severity on umbrella claims in accident years 2010 through 2013.

Unfavorable development for workers’ compensation was due to a reduction in estimated recoveries on war hazard claims for Defense Base Act contractors, which was partially offset by favorable development related to lower than expected frequencies for our small and middle market businesses in accident years 2009 through 2014.

Favorable development for property and other was primarily due to better than expected loss emergence in accident years 2013 through 2015.

Six Months

2017

Favorable development for commercial auto was primarily due to lower than expected severity in accident years 2013 through 2015.

Favorable development for workers’ compensation was primarily related to decreases in frequency and severity in recent accident years, partially attributable to California reforms related to decreases in medical costs.

Unfavorable development for property and other was primarily due to higher than expected severity in accident year 2016.

2016

Favorable development for commercial auto was primarily due to favorable settlements on claims in accident years 2010 through 2014.

Favorable development for general liability was primarily due to better than expected claim settlements in accident years 2012 through 2014 and better than expected severity on umbrella claims in accident years 2010 through 2013.

Unfavorable development for workers’ compensation was due to a reduction in estimated recoveries on war hazard claims for Defense Base Act contractors, which was partially offset by favorable development related to lower than expected frequencies for our small and middle market businesses in accident years 2009 through 2014.

Unfavorable development for property and other was primarily due to higher than expected severity from a 2015 catastrophe event. Favorable development was primarily due to better than expected loss emergence in accident years 2013 through 2015.

International

The following table presents further detail of the development recorded for the International segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Medical Professional Liability	$	(5	)	$	(1	)	$	(5	)	$	(1	)
Other Professional Liability	10			18			9			17
Liability	(5		)	(19		)	(5		)	(19		)
Property & Marine	(12		)	(3		)	(11		)	(7		)
Other	14			(10		)	12			(9		)
Total pretax (favorable) unfavorable development	$	2		$	(15	)	$	—		$	(19	)

Three Months

2017

Unfavorable development for other professional liability was primarily due to higher than expected severity in accident year 2015 arising from the management liability business. This was partially offset by favorable development in accident years 2014 and prior.

Favorable development for property and marine was due to better than expected frequency in accident years 2014 through 2016.

Unfavorable development for other coverages was primarily due to adverse large claims experience in the Hardy political risks portfolio, relating largely to accident year 2016.

2016

Unfavorable development for other professional liability was primarily due to higher than expected large loss emergence in accident years 2011 through 2015.

Favorable development for liability was primarily due to better than expected severity in accident years 2013 and prior.

Favorable development for other coverages was primarily due to better than expected severity in auto liability in accident years 2011 through 2015.

Six Months

2017

The drivers of development for the six month period were generally consistent with the three month summary above.

2016

Unfavorable development for other professional liability was primarily due to higher than expected large loss emergence in accident years 2011 through 2015.

Favorable development for liability was primarily due to better than expected severity in accident years 2013 and prior.

Favorable development for other coverages was primarily due to better than expected severity in auto liability in accident years 2011 through 2015.

Asbestos and Environmental Pollution (A&EP) Reserves

In 2010, Continental Casualty Company (CCC) together with several of the Company’s insurance subsidiaries completed a transaction with National Indemnity Company (NICO), a subsidiary of Berkshire Hathaway Inc., under which substantially all of the Company’s legacy A&EP liabilities were ceded to NICO through a Loss Portfolio Transfer (LPT). At the effective date of the transaction, the Company ceded approximately $1.6 billion of net A&EP claim and allocated claim adjustment expense reserves to NICO under a retroactive reinsurance agreement with an aggregate limit of $4 billion. The $1.6 billion of claim and allocated claim adjustment expense reserves ceded to NICO was net of $1.2 billion of ceded claim and allocated claim adjustment expense reserves under existing third-party reinsurance contracts. The NICO LPT aggregate reinsurance limit also covers credit risk on the existing third-party reinsurance related to these liabilities. The Company paid NICO a reinsurance premium of $2 billion and transferred to NICO billed third-party reinsurance receivables related to A&EP claims with a net book value of $215 million, resulting in total consideration of $2.2 billion.

Subsequent to the effective date of the LPT, the Company recognized adverse prior year development on its A&EP reserves which resulted in additional amounts ceded under the LPT. As a result, the cumulative amounts ceded under the LPT exceeded the $2.2 billion consideration paid, resulting in the NICO LPT moving into a gain position, requiring retroactive reinsurance accounting. Under retroactive reinsurance accounting, this gain is deferred and only recognized in earnings in proportion to actual paid recoveries under the LPT. Over the life of the contract, there is no economic impact as long as any additional losses incurred are within the limit of the LPT. In a period in which the Company recognizes a change in the estimate of A&EP reserves that increases the amounts ceded under the LPT, the proportion of actual paid recoveries to total ceded losses is impacted and the change in the deferred gain is recognized in earnings as if the revised estimate of ceded losses was available at the effective date of the LPT. The effect of the deferred retroactive reinsurance benefit is recorded in Insurance claims and policyholders' benefits in the Condensed Consolidated Statement of Operations.

The following table presents the impact of the Loss Portfolio Transfer on the Condensed Consolidated Statements of Operations.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net A&EP adverse development before consideration of LPT	$	—		$	—		$	60		$	200
Retroactive reinsurance benefit recognized	(3		)	(9		)	(43		)	(82		)
Pretax impact of A&EP reserve development and the LPT	$	(3	)	$	(9	)	$	17		$	118

Based upon the Company's annual A&EP reserve review, net unfavorable prior year development of $60 million and $200 million was recognized before consideration of cessions to the LPT for the six months ended June 30, 2017 and 2016. The 2017 unfavorable development was driven by modestly higher anticipated payouts on claims from known sources of asbestos exposure. The 2016 unfavorable development was driven by an increase in anticipated future expenses associated with determination of coverage, higher anticipated payouts associated with a limited number of historical accounts having significant asbestos exposures and higher than expected severity on pollution claims. While this unfavorable development was ceded to NICO under the LPT, the Company’s Net income in both periods was negatively affected due to the application of retroactive reinsurance accounting.

As of June 30, 2017 and December 31, 2016, the cumulative amounts ceded under the LPT were $2.9 billion and $2.8 billion. The unrecognized deferred retroactive reinsurance benefit was $351 million and $334 million as of June 30, 2017 and December 31, 2016.

NICO established a collateral trust account as security for its obligations to the Company. The fair value of the collateral trust account was $2.8 billion as of June 30, 2017 and December 31, 2016. In addition, Berkshire Hathaway Inc. guaranteed the payment obligations of NICO up to the aggregate reinsurance limit as well as certain of NICO’s performance obligations under the trust agreement. NICO is responsible for claims handling and billing and collection from third-party reinsurers related to the Company’s A&EP claims.

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Legal Proceedings and Guarantees

6 Months Ended

Jun. 30, 2017

Legal Proceedings, Commitments and Contingencies, and Guarantees [Abstract]

Legal Proceedings and Guarantees

Legal Proceedings and Guarantees

CNA 401(k) Plus Plan Litigation

In September 2016, a class action lawsuit was filed against CCC, Continental Assurance Company (CAC) (a former subsidiary of CCC), CNAF, the Investment Committee of the CNA 401(k) Plus Plan (Plan), The Northern Trust Company and John Does 1-10 (collectively Defendants) related to the Plan. The complaint alleges that Defendants breached fiduciary duties to the Plan and caused prohibited transactions in violation of the Employee Retirement Income Security Act of 1974 when the Plan's Fixed Income Fund’s annuity contract with CAC was canceled. The plaintiff alleges he and a proposed class of Plan participants who had invested in the Fixed Income Fund suffered lower returns in their Plan investments as a consequence of these alleged violations and seeks relief on behalf of the putative class. This litigation is in its early stages, and as of yet no class has been certified. CCC and the other defendants are contesting the case. The parties are scheduled to attend a mediation in September 2017.

Management believes the likelihood of loss is reasonably possible; however, given the status of the litigation, the novel issues raised by the allegations and the uncertainty as to how to assess potential damages, management is currently unable to predict the final outcome. The Plan trustees have provided notice to their fiduciary coverage insurance carriers. Based on management’s current assessment and consideration of available insurance coverage, management does not believe that the ultimate resolution of this matter will have a material impact on the Company’s Condensed Consolidated Financial Statements; however, the timing of recognition of loss, if any, and insurance recovery, if any, may differ.

Small Business Premium Rate Adjustment

In prior quarters the Company identified rating errors related to its multi-peril package product and workers' compensation policies within its Small Business unit, and the Company is in the process of voluntarily issuing premium refunds related to affected policies. After the rating errors were identified written and earned premium have been reported net of any impact from the premium rate adjustments. Premium development recognized as a result of the rating errors was favorable of $1 million and adverse of $37 million for the three and six months ended June 30, 2017, respectively.

The estimated refund liability for the multi-peril product and workers' compensation policies as of June 30, 2017 was $96 million. The Company has reduced pretax operating income by $1 million and $6 million for the three and six months ended June 30, 2017 for interest due to policyholders on the aggregate refund amounts. The amount of the refund and corresponding liability will continue to increase until required changes to the automated rating processes are fully implemented. The required changes were implemented in the second quarter of 2017 for the multi-peril product and are expected to be implemented by the end of the third quarter of 2017 for workers' compensation policies. Any fines or penalties related to the foregoing are reasonably possible, but are not expected to be material to the Company's Condensed Consolidated Financial Statements.

Other Litigation

The Company is a party to other routine litigation incidental to its business, which, based on the facts and circumstances currently known, is not material to the Condensed Consolidated Financial Statements.

Guarantees

As of June 30, 2017 and December 31, 2016, the Company had recorded liabilities of approximately $5 million related to guarantee and indemnification agreements. Management believes that it is not likely that any future indemnity claims will be significantly greater than the amounts recorded.

In the course of selling business entities and assets to third parties, the Company agreed to guarantee the performance of certain obligations of previously owned subsidiaries and to indemnify purchasers for losses arising out of breaches of representations and warranties with respect to the business entities or assets sold, including, in certain cases, losses arising from undisclosed liabilities or certain named litigation. Such guarantee and indemnification agreements in effect for sales of business entities, assets and third-party loans may include provisions that survive indefinitely. As of June 30, 2017, the aggregate amount related to quantifiable guarantees was $434 million and the aggregate amount related to quantifiable indemnification agreements was $254 million. In certain cases, should the Company be required to make payments under any such guarantee, it would have the right to seek reimbursement from an affiliate of a previously owned subsidiary.

In addition, the Company has agreed to provide indemnification to third-party purchasers for certain losses associated with sold business entities or assets that are not limited by a contractual monetary amount. As of June 30, 2017, the Company had outstanding unlimited indemnifications in connection with the sales of certain of its business entities or assets that included tax liabilities arising prior to a purchaser's ownership of an entity or asset, defects in title at the time of sale, employee claims arising prior to closing and in some cases losses arising from certain litigation and undisclosed liabilities. Certain provisions of the indemnification agreements survive indefinitely, while others survive until the applicable statutes of limitation expire, or until the agreed-upon contract terms expire.

The Company also provided guarantees, if the primary obligor fails to perform, to holders of structured settlement annuities provided by a previously owned subsidiary. As of June 30, 2017, the potential amount of future payments the Company could be required to pay under these guarantees was approximately $1.8 billion, which will be paid over the lifetime of the annuitants. The Company does not believe any payment is likely under these guarantees, as the Company is the beneficiary of a trust that must be maintained at a level that approximates the discounted reserves for these annuities.

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Benefit Plans

6 Months Ended

Jun. 30, 2017

Retirement Benefits [Abstract]

Benefit Plans

Benefit Plans

The components of net periodic cost (benefit) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pension cost (benefit)
Interest cost on projected benefit obligation	$	26		$	28		$	52		$	56
Expected return on plan assets	(39		)	(40		)	(78		)	(80		)
Amortization of net actuarial loss	9			10			18			19
Settlement loss	—			—			2			—
Net periodic pension cost (benefit)	$	(4	)	$	(2	)	$	(6	)	$	(5	)

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Accumulated Other Comprehensive Income (Loss) by Component

6 Months Ended

Jun. 30, 2017

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

Accumulated Other Comprehensive Income (Loss) by Component

Accumulated Other Comprehensive Income (Loss) by Component

The tables below display the changes in Accumulated other comprehensive income (loss) by component.

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of April 1, 2017	$	26		$	709	$	(640	)	$	(187	)	$	(92	)
Other comprehensive income (loss) before reclassifications	(1		)	108		—			42			149
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $1, $(15), $3, $- and $(11)	(1		)	31		(5		)	—			25
Other comprehensive income (loss) net of tax (expense) benefit of $-, $(48), $(3), $- and $(51)	—			77		5			42			124
Balance as of June 30, 2017	$	26		$	786	$	(635	)	$	(145	)	$	32

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of April 1, 2016	$	32		$	624	$	(642	)	$	(70	)	$	(56	)
Other comprehensive income (loss) before reclassifications	(1		)	323		—			(48		)	274
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $-, $(6), $3, $- and $(3)	—			13		(5		)	—			8
Other comprehensive income (loss) net of tax (expense) benefit of $1, $(157), $(3), $- and $(159)	(1		)	310		5			(48		)	266
Balance as of June 30, 2016	$	31		$	934	$	(637	)	$	(118	)	$	210

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of January 1, 2017	$	30		$	642	$	(647	)	$	(198	)	$	(173	)
Other comprehensive income (loss) before reclassifications	(1		)	193		—			53			245
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $(1), $(24), $7, $- and $(18)	3			49		(12		)	—			40
Other comprehensive income (loss) net of tax (expense) benefit of $1, $(86), $(7), $- and $(92)	(4		)	144		12			53			205
Balance as of June 30, 2017	$	26		$	786	$	(635	)	$	(145	)	$	32

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of January 1, 2016	$	27		$	390	$	(648	)	$	(84	)	$	(315	)
Other comprehensive income (loss) before reclassifications	2			546		—			(34		)	514
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $1, $1, $6, $- and $8	(2		)	2		(11		)	—			(11		)
Other comprehensive income (loss) net of tax (expense) benefit of $(2), $(273), $(6), $- and $(281)	4			544		11			(34		)	525
Balance as of June 30, 2016	$	31		$	934	$	(637	)	$	(118	)	$	210

Amounts reclassified from Accumulated other comprehensive income (loss) shown above are reported in Net income (loss) as follows:

Component of AOCI	Condensed Consolidated Statements of Operations Line Item Affected by Reclassifications
Net unrealized gains (losses) on investments with OTTI losses	Net realized investment gains (losses)
Net unrealized gains (losses) on other investments	Net realized investment gains (losses)
Pension and postretirement benefits	Other operating expenses

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Business Segments

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

Business Segments

Business Segments

The Company's core property and casualty commercial insurance operations are managed and reported in three business segments: Specialty, Commercial and International. The Company's non-core operations are managed and reported in two segments: Life & Group Non-Core and Corporate & Other Non-Core.

The accounting policies of the segments are the same as those described in Note A to the Consolidated Financial Statements within CNAF's Annual Report on Form 10-K for the year ended December 31, 2016. The Company manages most of its assets on a legal entity basis, while segment operations are generally conducted across legal entities. As such, only Insurance and Reinsurance receivables, Insurance reserves, Deferred acquisition costs and Goodwill are readily identifiable for all individual segments. Distinct investment portfolios are not maintained for every individual segment; accordingly, allocation of assets to each segment is not performed. Therefore, a significant portion of Net investment income and Realized investment gains or losses are allocated primarily based on each segment's net carried insurance reserves, as adjusted. All significant intersegment income and expense has been eliminated. Income taxes have been allocated on the basis of the taxable income of the segments.

In the following tables, certain financial measures are presented to provide information used by management to monitor the Company's operating performance. Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio. Net operating income (loss), which is derived from certain income statement amounts, is used by management to monitor performance of the Company's insurance operations. The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk. Based on such analyses, the Company may recognize an OTTI loss on an investment security in accordance with its policy, or sell a security, which may produce realized gains and losses.

Net operating income (loss) is calculated by excluding from net income (loss) the after-tax effects of i) net realized investment gains (losses) ii) income or loss from discontinued operations and iii) any cumulative effects of changes in accounting guidance. The calculation of net operating income excludes net realized investment gains (losses) because net realized investment gains (losses) are largely discretionary, except for some losses related to OTTI, and are generally driven by economic factors that are not necessarily consistent with key drivers of underwriting performance, and are therefore not considered an indication of trends in insurance operations.

The Company's results of operations and selected balance sheet items by segment are presented in the following tables.

Three months ended June 30, 2017	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	689		$	705		$	206		$	135		$	—		$	(1	)	$	1,734
Net investment income	120			143			13			195			4			—			475
Other revenues	98			9			(1		)	—			1			—			107
Total operating revenues	907			857			218			330			5			(1		)	2,316
Claims, Benefits and Expenses
Net incurred claims and benefits	398			422			129			328			(2		)	—			1,275
Policyholders’ dividends	1			4			—			—			—			—			5
Amortization of deferred acquisition costs	149			118			45			—			—			—			312
Other insurance related expenses	72			128			31			32			(1		)	(1		)	261
Other expenses	82			11			(1		)	1			50			—			143
Total claims, benefits and expenses	702			683			204			361			47			(1		)	1,996
Operating income (loss) before income tax	205			174			14			(31		)	(42		)	—			320
Income tax (expense) benefit on operating income (loss)	(69		)	(59		)	(4		)	36			15			—			(81		)
Net operating income (loss)	136			115			10			5			(27		)	—			239
Net realized investment gains (losses)	14			19			7			7			3			—			50
Income tax (expense) benefit on net realized investment gains (losses)	(5		)	(6		)	(1		)	(3		)	(2		)	—			(17		)
Net realized investment gains (losses), after tax	9			13			6			4			1			—			33
Net income (loss)	$	145		$	128		$	16		$	9		$	(26	)	$	—		$	272

Three months ended June 30, 2016	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	702		$	696		$	197		$	136		$	—		$	(1	)	$	1,730
Net investment income	133			164			13			188			4			—			502
Other revenues	89			8			—			3			—			—			100
Total operating revenues	924			868			210			327			4			(1		)	2,332
Claims, Benefits and Expenses
Net incurred claims and benefits	377			469			157			340			(8		)	—			1,335
Policyholders’ dividends	1			3			—			—			—			—			4
Amortization of deferred acquisition costs	148			117			40			—			—			—			305
Other insurance related expenses	73			130			37			31			—			(1		)	270
Other expenses	79			11			7			2			47			—			146
Total claims, benefits and expenses	678			730			241			373			39			(1		)	2,060
Operating income (loss) before income tax	246			138			(31		)	(46		)	(35		)	—			272
Income tax (expense) benefit on operating income (loss)	(82		)	(46		)	4			42			11			—			(71		)
Net operating income (loss)	164			92			(27		)	(4		)	(24		)	—			201
Net realized investment gains (losses)	4			8			4			(2		)	2			—			16
Income tax (expense) benefit on net realized investment gains (losses)	(2		)	(3		)	(1		)	(3		)	1			—			(8		)
Net realized investment gains (losses), after tax	2			5			3			(5		)	3			—			8
Net income (loss)	$	166		$	97		$	(24	)	$	(9	)	$	(21	)	$	—		$	209

Six months ended June 30, 2017	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,353		$	1,356		$	403		$	268		$	—		$	(1	)	$	3,379
Net investment income	273			321			25			392			9			—			1,020
Other revenues	192			18			(1		)	1			1			—			211
Total operating revenues	1,818			1,695			427			661			10			(1		)	4,610
Claims, Benefits and Expenses
Net incurred claims and benefits	784			859			244			658			19			—			2,564
Policyholders’ dividends	2			7			—			—			—			—			9
Amortization of deferred acquisition costs	292			234			91			—			—			—			617
Other insurance related expenses	141			254			58			64			(1		)	(1		)	515
Other expenses	163			25			(7		)	3			94			—			278
Total claims, benefits and expenses	1,382			1,379			386			725			112			(1		)	3,983
Operating income (loss) before income tax	436			316			41			(64		)	(102		)	—			627
Income tax (expense) benefit on operating income (loss)	(146		)	(107		)	(11		)	73			38			—			(153		)
Net operating income (loss)	290			209			30			9			(64		)	—			474
Net realized investment gains (losses)	21			30			13			17			5			—			86
Income tax (expense) benefit on net realized investment gains (losses)	(8		)	(9		)	(2		)	(7		)	(2		)	—			(28		)
Net realized investment gains (losses), after tax	13			21			11			10			3			—			58
Net income (loss)	$	303		$	230		$	41		$	19		$	(61	)	$	—		$	532

June 30, 2017
(In millions)
Reinsurance receivables	$	880	$	591	$	150	$	461	$	2,382	$	—		$	4,464
Insurance receivables	1,020		1,129		290		11		2		—			2,452
Deferred acquisition costs	318		234		95		—		—		—			647
Goodwill	117		—		30		—		—		—			147
Insurance reserves
Claim and claim adjustment expenses	6,229		8,586		1,442		3,417		2,505		—			22,179
Unearned premiums	1,988		1,481		500		139		—		(1		)	4,107
Future policy benefits	—		—		—		10,824		—		—			10,824

Six months ended June 30, 2016	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,384		$	1,384		$	395		$	267		$	—		$	(1	)	$	3,429
Net investment income	240			290			25			375			7			—			937
Other revenues	176			14			1			3			3			—			197
Total operating revenues	1,800			1,688			421			645			10			(1		)	4,563
Claims, Benefits and Expenses
Net incurred claims and benefits	767			911			278			663			120			—			2,739
Policyholders’ dividends	2			6			—			—			—			—			8
Amortization of deferred acquisition costs	292			233			87			—			—			—			612
Other insurance related expenses	148			271			65			64			—			(1		)	547
Other expenses	154			16			16			5			101			—			292
Total claims, benefits and expenses	1,363			1,437			446			732			221			(1		)	4,198
Operating income (loss) before income tax	437			251			(25		)	(87		)	(211		)	—			365
Income tax (expense) benefit on operating income (loss)	(146		)	(85		)	4			81			73			—			(73		)
Net operating income (loss)	291			166			(21		)	(6		)	(138		)	—			292
Net realized investment gains (losses)	(7		)	(10		)	8			(5		)	(6		)	—			(20		)
Income tax (expense) benefit on net realized investment gains (losses)	2			3			(2		)	(3		)	3			—			3
Net realized investment gains (losses), after tax	(5		)	(7		)	6			(8		)	(3		)	—			(17		)
Net income (loss)	$	286		$	159		$	(15	)	$	(14	)	$	(141	)	$	—		$	275

December 31, 2016
(In millions)
Reinsurance receivables	$	760	$	621	$	131	$	462	$	2,479	$	—	$	4,453
Insurance receivables	982		1,021		233		17		2		—		2,255
Deferred acquisition costs	310		214		76		—		—		—		600
Goodwill	117		—		28		—		—		—		145
Insurance reserves
Claim and claim adjustment expenses	6,149		8,894		1,328		3,358		2,614		—		22,343
Unearned premiums	1,911		1,323		396		132		—		—		3,762
Future policy benefits	—		—		—		10,326		—		—		10,326

The following table presents revenue by line of business for each reportable segment. Revenues are comprised of operating revenues and net realized investment gains and losses.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Specialty
Management & Professional Liability	$	646		$	659		$	1,307		$	1,277
Surety	137			133			260			260
Warranty & Alternative Risks	138			136			272			256
Specialty revenues	921			928			1,839			1,793
Commercial
Middle Market	462			434			920			835
Small Business	129			151			226			294
Other Commercial Insurance	285			291			579			549
Commercial revenues	876			876			1,725			1,678
International
Canada	53			51			104			101
CNA Europe	79			81			152			159
Hardy	93			82			184			169
International revenues	225			214			440			429
Life & Group Non-Core revenues	337			325			678			640
Corporate & Other Non-Core revenues	8			6			15			4
Eliminations	(1		)	(1		)	(1		)	(1		)
Total revenues	$	2,366		$	2,348		$	4,696		$	4,543

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General (Policies)

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

Consolidation

The accompanying Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Intercompany amounts have been eliminated. Certain financial information that is normally included in annual financial statements prepared in accordance with GAAP, including certain financial statement notes, is not required for interim reporting purposes and has been condensed or omitted. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in CNAF's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2016, including the summary of significant accounting policies in Note A.

Use of Estimates

The preparation of Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.

Recently Adopted Accounting Standards Updates and Accounting Standards Pending Adoption

Recently Adopted Accounting Standards Updates (ASU)

In March 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvementsto Employee Share-Based Payment Accounting. The updated accounting guidance simplifies the accounting for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. As of January 1, 2017, the Company adopted the updated accounting guidanceand began recognizing excess tax benefits or deficiencies on vesting or settlement of awards as an income tax benefit or expense within net income, instead of additional paid-in capital as required under previous guidance. The related cash flows are now classified within operating activities. As a result of this change, excess tax benefits are no longer included in assumed proceeds under the treasury stock method of calculating earnings per share. The impact of the accounting change resulted in a decrease of $0 million and $3 million to income tax expense for the three and six months ended June 30, 2017.

Accounting Standards Pending Adoption

In May 2014, the FASB issued ASU No. 2014-09, Revenue Recognition (Topic 606): Revenue from Contracts with Customers. The standard excludes from its scope the accounting for insurance contracts, financial instruments, and certain other agreements that are governed under other GAAP guidance. The updated guidance requires an entity to recognize revenue as performance obligations are met, in an amount that reflects the consideration the entity is entitled to receive for the transfer of the promised goods or services. The standard is effective for interim and annual reporting periods beginning after December 15, 2017 and may be applied retrospectively or through a cumulative effect adjustment to retained earnings at the date of adoption. As insurance contracts are out of scope, the Company anticipates the primary change will be to revenue recognition for certain of our warranty products and services. The Company has not made a decision on the method of adoption and is currently evaluating the effect the updated guidance will have on the Company’s financial statements, but we do not currently believe ASU 2014-09 will have a material effect on the Company's results of operations or financial position.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The updated accounting guidance requires changes to the reporting model for financial instruments. The guidance is effective for interim and annual periods beginning after December 15, 2017. The Company expects the primary change to be the requirement for equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. The updated accounting guidance requires lessees to recognize on the balance sheet the assets and liabilities for the rights and obligations created by all leases, including those historically accounted for as operating leases. The guidance is effective for interim and annual periods beginning after December 15, 2018. The Company is currently evaluating the effect the updated guidance will have on the Company's financial statements. It is expected that assets and liabilities will increase based on the present value of remaining lease payments for leases in place at the adoption date; however, this is not expected to be material to the Company's results of operations or financial position.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurementof Credit Losses on Financial Instruments. The updated accounting guidance requires changes to the recognition of credit losses on financial instruments not accounted for at fair value through net income. The guidance is effective for interim and annual periods beginning after December 15, 2019. The Company is currently evaluating the effect the guidance will have on the Company's financial statements, but expects the primary changes to be the use of the expected credit loss model for its mortgage loan portfolio and reinsurance receivables and the presentation of credit losses within the available-for-sale fixed maturities portfolio through an allowance method rather than as a direct write-down. The expected credit loss model will require a financial asset to be presented at the net amount expected to be collected. The allowance method for available-for-sale debt securities will allow the Company to record reversals of credit losses if the estimate of credit losses declines.

In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The updated accounting guidance requires changes to the presentation of the components of net periodic benefit cost on the income statement by requiring service cost to be presented with other employee compensation costs and other components of net periodic pension cost to be presented outside of any subtotal of operating income. The ASU also stipulates that only the service cost component of net benefit cost is eligible for capitalization. The guidance is effective for interim and annual periods beginning after December 15, 2017. The Company is currently evaluating the effect the guidance will have on the Company's financial statements.

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Investments (Tables)

6 Months Ended

Jun. 30, 2017

Investments [Abstract]

Net investment income

The significant components of Net investment income are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Fixed maturity securities	$	457		$	449		$	912		$	895
Equity securities	2			4			3			7
Limited partnership investments	16			46			106			32
Mortgage loans	8			13			15			22
Short term investments	3			1			6			4
Trading portfolio	4			4			6			6
Other	—			—			1			—
Gross investment income	490			517			1,049			966
Investment expense	(15		)	(15		)	(29		)	(29		)
Net investment income	$	475		$	502		$	1,020		$	937

Net realized investment gains (losses)

Net realized investment gains (losses) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net realized investment gains (losses):
Fixed maturity securities:
Gross realized gains	$	56		$	40		$	105		$	85
Gross realized losses	(12		)	(24		)	(29		)	(86		)
Net realized investment gains (losses) on fixed maturity securities	44			16			76			(1		)
Equity securities:
Gross realized gains	1			4			1			4
Gross realized losses	(1		)	(1		)	(1		)	(6		)
Net realized investment gains (losses) on equity securities	—			3			—			(2		)
Derivatives	(3		)	(6		)	(2		)	(13		)
Short term investments and other	9			3			12			(4		)
Net realized investment gains (losses)	$	50		$	16		$	86		$	(20	)

Components of net other than temporary impairment losses recognized in earnings by asset type

The components of Other-than-temporary impairment (OTTI) losses recognized in earnings by asset type are presented in the following table.

Periods ended June 30	Three Months				Six Months
(In millions)	2017		2016		2017		2016
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	2	$	13	$	4	$	29
Asset-backed:
Residential mortgage-backed	—		1		—		1
Other asset-backed	—		1		—		3
Total asset-backed	—		2		—		4
Total fixed maturity securities available-for-sale	2		15		4		33
Equity securities available-for-sale -- Common stock	—		—		—		5
OTTI losses recognized in earnings	$	2	$	15	$	4	$	38

Summary of fixed maturity and equity securities

The following tables present a summary of fixed maturity and equity securities.

June 30, 2017	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,823	$	1,589	$	29	$	19,383	$	—
States, municipalities and political subdivisions	12,461		1,380		15		13,826		(13		)
Asset-backed:
Residential mortgage-backed	4,835		124		38		4,921		(27		)
Commercial mortgage-backed	1,907		59		14		1,952		—
Other asset-backed	1,050		16		5		1,061		—
Total asset-backed	7,792		199		57		7,934		(27		)
U.S. Treasury and obligations of government-sponsored enterprises	113		4		2		115		—
Foreign government	438		12		1		449		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,645		3,185		104		41,726		$	(40	)
Total fixed maturity securities trading	23						23
Equity securities available-for-sale:
Common stock	17		5		—		22
Preferred stock	91		6		1		96
Total equity securities available-for-sale	108		11		1		118
Total	$	38,776	$	3,196	$	105	$	41,867

December 31, 2016	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Unrealized OTTI Losses (Gains)
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	17,711	$	1,323	$	76	$	18,958	$	(1	)
States, municipalities and political subdivisions	12,060		1,213		33		13,240		(16		)
Asset-backed:
Residential mortgage-backed	5,004		120		51		5,073		(28		)
Commercial mortgage-backed	2,016		48		24		2,040		—
Other asset-backed	1,022		8		5		1,025		—
Total asset-backed	8,042		176		80		8,138		(28		)
U.S. Treasury and obligations of government-sponsored enterprises	83		10		—		93		—
Foreign government	435		13		3		445		—
Redeemable preferred stock	18		1		—		19		—
Total fixed maturity securities available-for-sale	38,349		2,736		192		40,893		$	(45	)
Total fixed maturity securities trading	12						12
Equity securities available-for-sale:
Common stock	13		6		—		19
Preferred stock	93		2		4		91
Total equity securities available-for-sale	106		8		4		110
Total	$	38,467	$	2,744	$	196	$	41,015

Securities in a gross unrealized loss position

The following tables present the estimated fair value and gross unrealized losses of fixed maturity and equity securities in a gross unrealized loss position by the length of time in which the securities have continuously been in that position.

	Less than 12 Months				12 Months or Longer				Total
June 30, 2017	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	1,314	$	26	$	52	$	3	$	1,366	$	29
States, municipalities and political subdivisions	742		15		24		—		766		15
Asset-backed:
Residential mortgage-backed	1,722		34		141		4		1,863		38
Commercial mortgage-backed	473		8		125		6		598		14
Other asset-backed	159		4		14		1		173		5
Total asset-backed	2,354		46		280		11		2,634		57
U.S. Treasury and obligations of government-sponsored enterprises	65		2		—		—		65		2
Foreign government	109		1		—		—		109		1
Total fixed maturity securities available-for-sale	4,584		90		356		14		4,940		104
Equity securities available-for-sale:
Common stock	1		—		—		—		1		—
Preferred stock	15		1		—		—		15		1
Total equity securities available-for-sale	16		1		—		—		16		1
Total	$	4,600	$	91	$	356	$	14	$	4,956	$	105

	Less than 12 Months				12 Months or Longer				Total
December 31, 2016	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
(In millions)
Fixed maturity securities available-for-sale:
Corporate and other bonds	$	2,615	$	61	$	254	$	15	$	2,869	$	76
States, municipalities and political subdivisions	959		32		23		1		982		33
Asset-backed:
Residential mortgage-backed	2,136		44		201		7		2,337		51
Commercial mortgage-backed	756		22		69		2		825		24
Other asset-backed	398		5		24		—		422		5
Total asset-backed	3,290		71		294		9		3,584		80
U.S. Treasury and obligations of government-sponsored enterprises	5		—		—		—		5		—
Foreign government	108		3		—		—		108		3
Total fixed maturity securities available-for-sale	6,977		167		571		25		7,548		192
Equity securities available-for-sale -- Preferred stock	12		—		13		4		25		4
Total	$	6,989	$	167	$	584	$	29	$	7,573	$	196

Activity related to the pretax fixed maturity credit loss component reflected within retained earnings for securities still held for which a portion of an OTTI loss was recognized in OCI

The following table presents the activity related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held as of June 30, 2017 and 2016 for which a portion of an OTTI loss was recognized in Other comprehensive income (loss).

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Beginning balance of credit losses on fixed maturity securities	$	32		$	48		$	36		$	53
Reductions for securities sold during the period	(2		)	(7		)	(6		)	(12		)
Ending balance of credit losses on fixed maturity securities	$	30		$	41		$	30		$	41

Contractual maturity

The following table presents available-for-sale fixed maturity securities by contractual maturity.

	June 30, 2017				December 31, 2016
(In millions)	Cost or Amortized Cost		Estimated Fair Value		Cost or Amortized Cost		Estimated Fair Value
Due in one year or less	$	1,590	$	1,628	$	1,779	$	1,828
Due after one year through five years	7,732		8,098		7,566		7,955
Due after five years through ten years	15,754		16,404		15,892		16,332
Due after ten years	13,569		15,596		13,112		14,778
Total	$	38,645	$	41,726	$	38,349	$	40,893

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Fair Value (Tables)

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis are presented in the following tables.

June 30, 2017							Total Assets/Liabilities at Fair Value
(In millions)	Level 1		Level 2		Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	—	$	19,306	$	100	$	19,406
States, municipalities and political subdivisions	—		13,825		1		13,826
Asset-backed:
Residential mortgage-backed	—		4,798		123		4,921
Commercial mortgage-backed	—		1,939		13		1,952
Other asset-backed	—		979		82		1,061
Total asset-backed	—		7,716		218		7,934
U.S. Treasury and obligations of government-sponsored enterprises	115		—		—		115
Foreign government	—		449		—		449
Redeemable preferred stock	19		—		—		19
Total fixed maturity securities	134		41,296		319		41,749
Equity securities	99		—		19		118
Other invested assets	—		5		—		5
Short term investments	260		981		—		1,241
Life settlement contracts, included in Other assets	—		—		1		1
Total assets	$	493	$	42,282	$	339	$	43,114
Liabilities
Other liabilities	$	—	$	1	$	—	$	1
Total liabilities	$	—	$	1	$	—	$	1

December 31, 2016								Total Assets/Liabilities at Fair Value
(In millions)	Level 1		Level 2			Level 3
Assets
Fixed maturity securities:
Corporate and other bonds	$	—	$	18,840		$	130	$	18,970
States, municipalities and political subdivisions	—		13,239			1		13,240
Asset-backed:
Residential mortgage-backed	—		4,944			129		5,073
Commercial mortgage-backed	—		2,027			13		2,040
Other asset-backed	—		968			57		1,025
Total asset-backed	—		7,939			199		8,138
U.S. Treasury and obligations of government-sponsored enterprises	93		—			—		93
Foreign government	—		445			—		445
Redeemable preferred stock	19		—			—		19
Total fixed maturity securities	112		40,463			330		40,905
Equity securities	91		—			19		110
Other invested assets	—		5			—		5
Short term investments	475		853			—		1,328
Life settlement contracts, included in Other assets	—		—			58		58
Total assets	$	678	$	41,321		$	407	$	42,406
Liabilities
Other liabilities	$	—	$	(3	)	$	—	$	(3	)
Total liabilities	$	—	$	(3	)	$	—	$	(3	)

Table of reconciliation for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs

The tables below present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

Level 3 (In millions)	Balance as of April 1, 2017		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)		Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2017		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2017 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	121	$	—	$	—	$	—	$	—		$	(11	)	$	—	$	(10	)	$	100	$	—
States, municipalities and political subdivisions	1		—		—		—		—			—			—		—			1		—
Asset-backed:
Residential mortgage-backed	126		1		1		—		—			(5		)	—		—			123		—
Commercial mortgage-backed	13		—		—		—		—			—			—		—			13		—
Other asset-backed	117		—		—		13		—			(2		)	24		(70		)	82		—
Total asset-backed	256		1		1		13		—			(7		)	24		(70		)	218		—
Total fixed maturity securities	378		1		1		13		—			(18		)	24		(80		)	319		—
Equity securities	19		—		1		—		(1		)	—			—		—			19		—
Life settlement contracts	46		—		—		—		(45		)	—			—		—			1		—
Total	$	443	$	1	$	2	$	13	$	(46	)	$	(18	)	$	24	$	(80	)	$	339	$	—

Level 3 (In millions)	Balance as of April 1, 2016		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2016		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2016 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	193	$	1	$	3		$	94	$	(20	)	$	(7	)	$	—	$	(22	)	$	242	$	—
States, municipalities and political subdivisions	2		—		—			—		—			—			—		—			2		—
Asset-backed:
Residential mortgage-backed	128		1		(1		)	10		—			(4		)	—		—			134		—
Commercial mortgage-backed	27		—		—			—		—			(9		)	3		(10		)	11		—
Other asset-backed	50		—		2			35		(25		)	(1		)	—		(16		)	45		—
Total asset-backed	205		1		1			45		(25		)	(14		)	3		(26		)	190		—
Total fixed maturity securities	400		2		4			139		(45		)	(21		)	3		(48		)	434		—
Equity securities	19		—		—			—		—			—			—		—			19		—
Life settlement contracts	72		6		—			—		—			(11		)	—		—			67		(3		)
Total	$	491	$	8	$	4		$	139	$	(45	)	$	(32	)	$	3	$	(48	)	$	520	$	(3	)

Level 3 (In millions)	Balance as of January 1, 2017		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*			Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)		Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2017		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2017 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	130	$	—		$	1	$	5	$	(1	)	$	(25	)	$	—	$	(10	)	$	100	$	—
States, municipalities and political subdivisions	1		—			—		—		—			—			—		—			1		—
Asset-backed:
Residential mortgage-backed	129		2			3		—		—			(11		)	—		—			123		—
Commercial mortgage-backed	13		—			—		—		—			—			—		—			13		—
Other asset-backed	57		(1		)	—		51		—			(2		)	52		(75		)	82		—
Total asset-backed	199		1			3		51		—			(13		)	52		(75		)	218		—
Total fixed maturity securities	330		1			4		56		(1		)	(38		)	52		(85		)	319		—
Equity securities	19		—			2		1		(3		)	—			—		—			19		—
Derivative financial instruments	—		1			—		—		(1		)	—			—		—			—		—
Life settlement contracts	58		6			—		—		(58		)	(5		)	—		—			1		—
Total	$	407	$	8		$	6	$	57	$	(63	)	$	(43	)	$	52	$	(85	)	$	339	$	—

Level 3 (In millions)	Balance as of January 1, 2016		Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)*		Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			Purchases		Sales			Settlements			Transfers into Level 3		Transfers out of Level 3			Balance as of June 30, 2016		Unrealized gains (losses) on Level 3 assets and liabilities held as of June 30, 2016 recognized in Net income (loss)*
Fixed maturity securities:
Corporate and other bonds	$	168	$	—	$	7		$	147	$	(36	)	$	(10	)	$	—	$	(34	)	$	242	$	—
States, municipalities and political subdivisions	2		—		—			—		—			—			—		—			2		—
Asset-backed:
Residential mortgage-backed	134		2		(1		)	10		—			(9		)	—		(2		)	134		—
Commercial mortgage-backed	22		—		—			9		—			(9		)	3		(14		)	11		—
Other asset-backed	53		—		2			35		(25		)	(1		)	2		(21		)	45		—
Total asset-backed	209		2		1			54		(25		)	(19		)	5		(37		)	190		—
Total fixed maturity securities	379		2		8			201		(61		)	(29		)	5		(71		)	434		—
Equity securities	20		—		(1		)	—		—			—			—		—			19		—
Life settlement contracts	74		10		—			—		—			(17		)	—		—			67		(3		)
Total	$	473	$	12	$	7		$	201	$	(61	)	$	(46	)	$	5	$	(71	)	$	520	$	(3	)

*Net realized and unrealized gains and losses from Level 3 securities and derivatives are reported in Net income (loss) as follows:

Major Category of Assets and Liabilities	Condensed Consolidated Statements of Operations Line Items
Fixed maturity securities available-for-sale (1)	Net realized investment gains (losses)
Fixed maturity securities trading	Net investment income
Equity securities (1)	Net realized investment gains (losses)
Other invested assets - Derivative financial instruments held in a trading portfolio	Net investment income
Other invested assets - Derivative financial instruments not held in a trading portfolio	Net realized investment gains (losses)
Life settlement contracts	Other revenues
Other liabilities - Derivative financial instruments	Net realized investment gains (losses)

(1) Unrealized gains and losses are reported within AOCI.

Qualitative information about assets and liabilities

*Net realized and unrealized gains and losses from Level 3 securities and derivatives are reported in Net income (loss) as follows:

Major Category of Assets and Liabilities	Condensed Consolidated Statements of Operations Line Items
Fixed maturity securities available-for-sale (1)	Net realized investment gains (losses)
Fixed maturity securities trading	Net investment income
Equity securities (1)	Net realized investment gains (losses)
Other invested assets - Derivative financial instruments held in a trading portfolio	Net investment income
Other invested assets - Derivative financial instruments not held in a trading portfolio	Net realized investment gains (losses)
Life settlement contracts	Other revenues
Other liabilities - Derivative financial instruments	Net realized investment gains (losses)

(1) Unrealized gains and losses are reported within AOCI.

Quantitative information about significant unobservable inputs in the fair value measurement of level 3 assets

The following tables present quantitative information about the significant unobservable inputs utilized by the Company in the fair value measurements of Level 3 assets. Valuations for assets and liabilities not presented in the tables below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company. The valuation of life settlement contracts was based on the terms of the sale of the contracts to a third party; therefore, the contracts are not included in the table below.

June 30, 2017	Estimated Fair Value (In millions)		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	125	Discounted cash flow	Credit spread	2% - 40% (4%)

December 31, 2016	Estimated Fair Value (In millions)		Valuation Technique(s)	Unobservable Input(s)	Range  (Weighted Average)
Fixed maturity securities	$	106	Discounted cash flow	Credit spread	2% - 40% (4%)

Carrying amount and estimated fair value of financial instrument assets and liabilities not measured at fair value

The carrying amount and estimated fair value of the Company's financial assets and liabilities which are not measured at fair value on the Condensed Consolidated Balance Sheets are presented in the following tables.

June 30, 2017	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Assets
Mortgage loans	$	646	$	—	$	—	$	655	$	655
Note receivable	45		—		—		45		45
Liabilities
Short term debt	$	150	$	—	$	154	$	—	$	154
Long term debt	2,561		—		2,819		—		2,819

December 31, 2016	Carrying Amount		Estimated Fair Value
(In millions)			Level 1		Level 2		Level 3		Total
Assets
Mortgage loans	$	591	$	—	$	—	$	594	$	594
Liabilities
Long term debt	$	2,710	$	—	$	2,952	$	—	$	2,952

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Claim and Claim Adjustment Expense Reserves (Tables)

6 Months Ended

Jun. 30, 2017

Liability for Claims and Claims Adjustment Expense [Line Items]

Schedule of liability for unpaid claims and claims adjustment expense

The following table presents a reconciliation between beginning and ending claim and claim adjustment expense reserves, including claim and claim adjustment expense reserves of the Life & Group Non-Core segment.

For the six months ended June 30
(In millions)	2017			2016
Reserves, beginning of year:
Gross	$	22,343		$	22,663
Ceded	4,094			4,087
Net reserves, beginning of year	18,249			18,576
Net incurred claim and claim adjustment expenses:
Provision for insured events of current year	2,443			2,583
Decrease in provision for insured events of prior years	(159		)	(198		)
Amortization of discount	93			93
Total net incurred (1)	2,377			2,478
Net payments attributable to:
Current year events	(266		)	(311		)
Prior year events	(2,331		)	(2,185		)
Total net payments	(2,597		)	(2,496		)
Foreign currency translation adjustment and other	70			46
Net reserves, end of period	18,099			18,604
Ceded reserves, end of period	4,080			4,371
Gross reserves, end of period	$	22,179		$	22,975

(1) Total net incurred above does not agree to Insurance claims and policyholders' benefits as reflected on the Condensed Consolidated Statements of Operations due to amounts related to retroactive reinsurance deferred gain accounting, uncollectible reinsurance and loss deductible receivables, and benefit expenses related to future policy benefits, which are not reflected in the table above.

Net prior year development

The following tables and discussion present the net prior year development recorded for Specialty, Commercial, International and Corporate & Other Non-Core segments.

Three months ended June 30, 2017
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(23	)	$	(34	)	$	2		$	—	$	(55	)
Pretax (favorable) unfavorable premium development	(5		)	1			(4		)	—		(8		)
Total pretax (favorable) unfavorable net prior year development	$	(28	)	$	(33	)	$	(2	)	$	—	$	(63	)

Three months ended June 30, 2016
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(65	)	$	(18	)	$	(15	)	$	—	$	(98	)
Pretax (favorable) unfavorable premium development	(7		)	(2		)	1			—		(8		)
Total pretax (favorable) unfavorable net prior year development	$	(72	)	$	(20	)	$	(14	)	$	—	$	(106	)

Six months ended June 30, 2017
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(54	)	$	(58	)	$	—		$	—	$	(112	)
Pretax (favorable) unfavorable premium development	(10		)	38			(11		)	—		17
Total pretax (favorable) unfavorable net prior year development	$	(64	)	$	(20	)	$	(11	)	$	—	$	(95	)

Six months ended June 30, 2016
(In millions)	Specialty			Commercial			International			Corporate & Other Non-Core		Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$	(99	)	$	(32	)	$	(19	)	$	—	$	(150	)
Pretax (favorable) unfavorable premium development	(18		)	(4		)	—			—		(22		)
Total pretax (favorable) unfavorable net prior year development	$	(117	)	$	(36	)	$	(19	)	$	—	$	(172	)

Specialty

Liability for Claims and Claims Adjustment Expense [Line Items]

Net prior year claim and allocated claim adjustment expense reserve development

The following table presents further detail of the net prior year claim and allocated claim adjustment expense reserve development (development) recorded for the Specialty segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Medical Professional Liability	$	3		$	(23	)	$	4		$	(30	)
Other Professional Liability and Management Liability	(37		)	(41		)	(69		)	(50		)
Surety	—			—			—			—
Warranty	6			3			6			5
Other	5			(4		)	5			(24		)
Total pretax (favorable) unfavorable development	$	(23	)	$	(65	)	$	(54	)	$	(99	)

Commercial

Liability for Claims and Claims Adjustment Expense [Line Items]

Net prior year claim and allocated claim adjustment expense reserve development

The following table presents further detail of the development recorded for the Commercial segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Commercial Auto	$	—		$	(20	)	$	(26	)	$	(35	)
General Liability	(1		)	(37		)	(1		)	(52		)
Workers' Compensation	(46		)	50			(46		)	54
Property and Other	13			(11		)	15			1
Total pretax (favorable) unfavorable development	$	(34	)	$	(18	)	$	(58	)	$	(32	)

International

Liability for Claims and Claims Adjustment Expense [Line Items]

Net prior year claim and allocated claim adjustment expense reserve development

The following table presents further detail of the development recorded for the International segment.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pretax (favorable) unfavorable development:
Medical Professional Liability	$	(5	)	$	(1	)	$	(5	)	$	(1	)
Other Professional Liability	10			18			9			17
Liability	(5		)	(19		)	(5		)	(19		)
Property & Marine	(12		)	(3		)	(11		)	(7		)
Other	14			(10		)	12			(9		)
Total pretax (favorable) unfavorable development	$	2		$	(15	)	$	—		$	(19	)

CNAF Consolidated

Liability for Claims and Claims Adjustment Expense [Line Items]

Impact of loss portfolio transfer on the consolidated statement of operations

The following table presents the impact of the Loss Portfolio Transfer on the Condensed Consolidated Statements of Operations.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Net A&EP adverse development before consideration of LPT	$	—		$	—		$	60		$	200
Retroactive reinsurance benefit recognized	(3		)	(9		)	(43		)	(82		)
Pretax impact of A&EP reserve development and the LPT	$	(3	)	$	(9	)	$	17		$	118

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Benefit Plans (Tables)

6 Months Ended

Jun. 30, 2017

Retirement Benefits [Abstract]

Components of net periodic cost (benefit)

The components of net periodic cost (benefit) are presented in the following table.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Pension cost (benefit)
Interest cost on projected benefit obligation	$	26		$	28		$	52		$	56
Expected return on plan assets	(39		)	(40		)	(78		)	(80		)
Amortization of net actuarial loss	9			10			18			19
Settlement loss	—			—			2			—
Net periodic pension cost (benefit)	$	(4	)	$	(2	)	$	(6	)	$	(5	)

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Accumulated Other Comprehensive Income (Loss) by Component (Tables)

6 Months Ended

Jun. 30, 2017

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

Accumulated other comprehensive income (loss) by component

The tables below display the changes in Accumulated other comprehensive income (loss) by component.

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of April 1, 2017	$	26		$	709	$	(640	)	$	(187	)	$	(92	)
Other comprehensive income (loss) before reclassifications	(1		)	108		—			42			149
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $1, $(15), $3, $- and $(11)	(1		)	31		(5		)	—			25
Other comprehensive income (loss) net of tax (expense) benefit of $-, $(48), $(3), $- and $(51)	—			77		5			42			124
Balance as of June 30, 2017	$	26		$	786	$	(635	)	$	(145	)	$	32

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of April 1, 2016	$	32		$	624	$	(642	)	$	(70	)	$	(56	)
Other comprehensive income (loss) before reclassifications	(1		)	323		—			(48		)	274
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $-, $(6), $3, $- and $(3)	—			13		(5		)	—			8
Other comprehensive income (loss) net of tax (expense) benefit of $1, $(157), $(3), $- and $(159)	(1		)	310		5			(48		)	266
Balance as of June 30, 2016	$	31		$	934	$	(637	)	$	(118	)	$	210

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of January 1, 2017	$	30		$	642	$	(647	)	$	(198	)	$	(173	)
Other comprehensive income (loss) before reclassifications	(1		)	193		—			53			245
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $(1), $(24), $7, $- and $(18)	3			49		(12		)	—			40
Other comprehensive income (loss) net of tax (expense) benefit of $1, $(86), $(7), $- and $(92)	(4		)	144		12			53			205
Balance as of June 30, 2017	$	26		$	786	$	(635	)	$	(145	)	$	32

(In millions)	Net unrealized gains (losses) on investments with OTTI losses			Net unrealized gains (losses) on other investments		Pension and postretirement benefits			Cumulative foreign currency translation adjustment			Total
Balance as of January 1, 2016	$	27		$	390	$	(648	)	$	(84	)	$	(315	)
Other comprehensive income (loss) before reclassifications	2			546		—			(34		)	514
Amounts reclassified from accumulated other comprehensive income (loss) net of tax (expense) benefit of $1, $1, $6, $- and $8	(2		)	2		(11		)	—			(11		)
Other comprehensive income (loss) net of tax (expense) benefit of $(2), $(273), $(6), $- and $(281)	4			544		11			(34		)	525
Balance as of June 30, 2016	$	31		$	934	$	(637	)	$	(118	)	$	210

Reclassification out of accumulated other comprehensive income

Amounts reclassified from Accumulated other comprehensive income (loss) shown above are reported in Net income (loss) as follows:

Component of AOCI	Condensed Consolidated Statements of Operations Line Item Affected by Reclassifications
Net unrealized gains (losses) on investments with OTTI losses	Net realized investment gains (losses)
Net unrealized gains (losses) on other investments	Net realized investment gains (losses)
Pension and postretirement benefits	Other operating expenses

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Business Segments (Tables)

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

Significant components of the Company's continuing operations and selected balance sheet items

The Company's results of operations and selected balance sheet items by segment are presented in the following tables.

Three months ended June 30, 2017	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	689		$	705		$	206		$	135		$	—		$	(1	)	$	1,734
Net investment income	120			143			13			195			4			—			475
Other revenues	98			9			(1		)	—			1			—			107
Total operating revenues	907			857			218			330			5			(1		)	2,316
Claims, Benefits and Expenses
Net incurred claims and benefits	398			422			129			328			(2		)	—			1,275
Policyholders’ dividends	1			4			—			—			—			—			5
Amortization of deferred acquisition costs	149			118			45			—			—			—			312
Other insurance related expenses	72			128			31			32			(1		)	(1		)	261
Other expenses	82			11			(1		)	1			50			—			143
Total claims, benefits and expenses	702			683			204			361			47			(1		)	1,996
Operating income (loss) before income tax	205			174			14			(31		)	(42		)	—			320
Income tax (expense) benefit on operating income (loss)	(69		)	(59		)	(4		)	36			15			—			(81		)
Net operating income (loss)	136			115			10			5			(27		)	—			239
Net realized investment gains (losses)	14			19			7			7			3			—			50
Income tax (expense) benefit on net realized investment gains (losses)	(5		)	(6		)	(1		)	(3		)	(2		)	—			(17		)
Net realized investment gains (losses), after tax	9			13			6			4			1			—			33
Net income (loss)	$	145		$	128		$	16		$	9		$	(26	)	$	—		$	272

Three months ended June 30, 2016	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	702		$	696		$	197		$	136		$	—		$	(1	)	$	1,730
Net investment income	133			164			13			188			4			—			502
Other revenues	89			8			—			3			—			—			100
Total operating revenues	924			868			210			327			4			(1		)	2,332
Claims, Benefits and Expenses
Net incurred claims and benefits	377			469			157			340			(8		)	—			1,335
Policyholders’ dividends	1			3			—			—			—			—			4
Amortization of deferred acquisition costs	148			117			40			—			—			—			305
Other insurance related expenses	73			130			37			31			—			(1		)	270
Other expenses	79			11			7			2			47			—			146
Total claims, benefits and expenses	678			730			241			373			39			(1		)	2,060
Operating income (loss) before income tax	246			138			(31		)	(46		)	(35		)	—			272
Income tax (expense) benefit on operating income (loss)	(82		)	(46		)	4			42			11			—			(71		)
Net operating income (loss)	164			92			(27		)	(4		)	(24		)	—			201
Net realized investment gains (losses)	4			8			4			(2		)	2			—			16
Income tax (expense) benefit on net realized investment gains (losses)	(2		)	(3		)	(1		)	(3		)	1			—			(8		)
Net realized investment gains (losses), after tax	2			5			3			(5		)	3			—			8
Net income (loss)	$	166		$	97		$	(24	)	$	(9	)	$	(21	)	$	—		$	209

Six months ended June 30, 2017	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,353		$	1,356		$	403		$	268		$	—		$	(1	)	$	3,379
Net investment income	273			321			25			392			9			—			1,020
Other revenues	192			18			(1		)	1			1			—			211
Total operating revenues	1,818			1,695			427			661			10			(1		)	4,610
Claims, Benefits and Expenses
Net incurred claims and benefits	784			859			244			658			19			—			2,564
Policyholders’ dividends	2			7			—			—			—			—			9
Amortization of deferred acquisition costs	292			234			91			—			—			—			617
Other insurance related expenses	141			254			58			64			(1		)	(1		)	515
Other expenses	163			25			(7		)	3			94			—			278
Total claims, benefits and expenses	1,382			1,379			386			725			112			(1		)	3,983
Operating income (loss) before income tax	436			316			41			(64		)	(102		)	—			627
Income tax (expense) benefit on operating income (loss)	(146		)	(107		)	(11		)	73			38			—			(153		)
Net operating income (loss)	290			209			30			9			(64		)	—			474
Net realized investment gains (losses)	21			30			13			17			5			—			86
Income tax (expense) benefit on net realized investment gains (losses)	(8		)	(9		)	(2		)	(7		)	(2		)	—			(28		)
Net realized investment gains (losses), after tax	13			21			11			10			3			—			58
Net income (loss)	$	303		$	230		$	41		$	19		$	(61	)	$	—		$	532

June 30, 2017
(In millions)
Reinsurance receivables	$	880	$	591	$	150	$	461	$	2,382	$	—		$	4,464
Insurance receivables	1,020		1,129		290		11		2		—			2,452
Deferred acquisition costs	318		234		95		—		—		—			647
Goodwill	117		—		30		—		—		—			147
Insurance reserves
Claim and claim adjustment expenses	6,229		8,586		1,442		3,417		2,505		—			22,179
Unearned premiums	1,988		1,481		500		139		—		(1		)	4,107
Future policy benefits	—		—		—		10,824		—		—			10,824

Six months ended June 30, 2016	Specialty			Commercial			International			Life & Group Non-Core			Corporate & Other Non-Core
(In millions)																Eliminations			Total
Operating revenues
Net earned premiums	$	1,384		$	1,384		$	395		$	267		$	—		$	(1	)	$	3,429
Net investment income	240			290			25			375			7			—			937
Other revenues	176			14			1			3			3			—			197
Total operating revenues	1,800			1,688			421			645			10			(1		)	4,563
Claims, Benefits and Expenses
Net incurred claims and benefits	767			911			278			663			120			—			2,739
Policyholders’ dividends	2			6			—			—			—			—			8
Amortization of deferred acquisition costs	292			233			87			—			—			—			612
Other insurance related expenses	148			271			65			64			—			(1		)	547
Other expenses	154			16			16			5			101			—			292
Total claims, benefits and expenses	1,363			1,437			446			732			221			(1		)	4,198
Operating income (loss) before income tax	437			251			(25		)	(87		)	(211		)	—			365
Income tax (expense) benefit on operating income (loss)	(146		)	(85		)	4			81			73			—			(73		)
Net operating income (loss)	291			166			(21		)	(6		)	(138		)	—			292
Net realized investment gains (losses)	(7		)	(10		)	8			(5		)	(6		)	—			(20		)
Income tax (expense) benefit on net realized investment gains (losses)	2			3			(2		)	(3		)	3			—			3
Net realized investment gains (losses), after tax	(5		)	(7		)	6			(8		)	(3		)	—			(17		)
Net income (loss)	$	286		$	159		$	(15	)	$	(14	)	$	(141	)	$	—		$	275

December 31, 2016
(In millions)
Reinsurance receivables	$	760	$	621	$	131	$	462	$	2,479	$	—	$	4,453
Insurance receivables	982		1,021		233		17		2		—		2,255
Deferred acquisition costs	310		214		76		—		—		—		600
Goodwill	117		—		28		—		—		—		145
Insurance reserves
Claim and claim adjustment expenses	6,149		8,894		1,328		3,358		2,614		—		22,343
Unearned premiums	1,911		1,323		396		132		—		—		3,762
Future policy benefits	—		—		—		10,326		—		—		10,326

Revenues by line of business

The following table presents revenue by line of business for each reportable segment. Revenues are comprised of operating revenues and net realized investment gains and losses.

Periods ended June 30	Three Months						Six Months
(In millions)	2017			2016			2017			2016
Specialty
Management & Professional Liability	$	646		$	659		$	1,307		$	1,277
Surety	137			133			260			260
Warranty & Alternative Risks	138			136			272			256
Specialty revenues	921			928			1,839			1,793
Commercial
Middle Market	462			434			920			835
Small Business	129			151			226			294
Other Commercial Insurance	285			291			579			549
Commercial revenues	876			876			1,725			1,678
International
Canada	53			51			104			101
CNA Europe	79			81			152			159
Hardy	93			82			184			169
International revenues	225			214			440			429
Life & Group Non-Core revenues	337			325			678			640
Corporate & Other Non-Core revenues	8			6			15			4
Eliminations	(1		)	(1		)	(1		)	(1		)
Total revenues	$	2,366		$	2,348		$	4,696		$	4,543

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General - Narrative (Details) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2017 USD ($)
Noncontrolling Interest [Line Items]
Employee service share-based compensation, tax benefit realized from exercise of stock options	$ 0	$ 3
CNAF Consolidated | Loews
Noncontrolling Interest [Line Items]
Ownership percentage of outstanding common stock of CNAF	90.00%	90.00%

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Earnings Per Share - Narrative (Details) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Earnings Per Share [Abstract]
Incremental common shares attributable to dilutive effect of share-based payment arrangements	847	409	915	473
Antidilutive securities excluded from computation of earnings per share, amount (less than)	1	178	1	180

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Investments - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Jun. 30, 2016	Jun. 30, 2017	Dec. 31, 2016
Investments [Abstract]
Net realized investment losses	$ 8
Redemption senior notes	$ 350
Reduction of net unrealized gains on investments included in AOCI due to shadow adjustments		$ 1,221	$ 1,014
Embedded derivative notional value		171	174
Embedded Derivative, Fair Value of Embedded Derivative Liability		(1)	$ 3
Future capital call commitments for limited partnership investments		415
Mortgage loan commitments		39
Commitments to purchase or fund privately placed debt securities		196
Commitments to sell various privately placed debt securities		$ 165

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Investments - Net investment income (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Net Investment Income [Line Items]
Gross investment income	$ 490	$ 517	$ 1,049	$ 966
Investment expense	(15)	(15)	(29)	(29)
Net investment income	475	502	1,020	937
Fixed maturity securities
Net Investment Income [Line Items]
Gross investment income	457	449	912	895
Equity securities
Net Investment Income [Line Items]
Gross investment income	2	4	3	7
Limited partnership investments
Net Investment Income [Line Items]
Gross investment income	16	46	106	32
Mortgage loans
Net Investment Income [Line Items]
Gross investment income	8	13	15	22
Short term investments
Net Investment Income [Line Items]
Gross investment income	3	1	6	4
Trading portfolio
Net Investment Income [Line Items]
Gross investment income	4	4	6	6
Other
Net Investment Income [Line Items]
Gross investment income	$ 0	$ 0	$ 1	$ 0

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Investments - Net realized investment gains (losses) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Schedule of Available-for-sale Securities [Line Items]
Net realized investment gains (losses) on fixed maturity securities	$ 50	$ 16	$ 86	$ (20)
Fixed maturity securities
Schedule of Available-for-sale Securities [Line Items]
Gross realized gains	56	40	105	85
Gross realized losses	(12)	(24)	(29)	(86)
Net realized investment gains (losses) on fixed maturity securities	44	16	76	(1)
Equity securities
Schedule of Available-for-sale Securities [Line Items]
Gross realized gains	1	4	1	4
Gross realized losses	(1)	(1)	(1)	(6)
Net realized investment gains (losses) on fixed maturity securities	0	3	0	(2)
Derivatives
Schedule of Available-for-sale Securities [Line Items]
Net realized investment gains (losses) on fixed maturity securities	(3)	(6)	(2)	(13)
Short term investments and other
Schedule of Available-for-sale Securities [Line Items]
Net realized investment gains (losses) on fixed maturity securities	$ 9	$ 3	$ 12	$ (4)

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Investments - Components of other-than-temporary impairment losses recognized in earnings (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	$ 2	$ 15	$ 4	$ 38
Corporate and other bonds
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	2	13	4	29
Residential mortgage-backed
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	0	1	0	1
Other asset-backed
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	0	1	0	3
Total asset-backed
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	0	2	0	4
Total fixed maturity securities available-for-sale
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	2	15	4	33
Equity securities available-for-sale -- Common stock
Schedule of Available-for-sale Securities [Line Items]
OTTI losses recognized in earnings	$ 0	$ 0	$ 0	$ 5

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Investments - Summary of fixed maturity and equity securities (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	$ 38,776	$ 38,467
Gross Unrealized Gains	3,196	2,744
Gross Unrealized Losses	105	196
Estimated Fair Value	41,867	41,015
Corporate and other bonds
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	17,823	17,711
Gross Unrealized Gains	1,589	1,323
Gross Unrealized Losses	29	76
Estimated Fair Value	19,383	18,958
Unrealized OTTI Losses (Gains)	0	(1)
States, municipalities and political subdivisions
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	12,461	12,060
Gross Unrealized Gains	1,380	1,213
Gross Unrealized Losses	15	33
Estimated Fair Value	13,826	13,240
Unrealized OTTI Losses (Gains)	(13)	(16)
Residential mortgage-backed
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	4,835	5,004
Gross Unrealized Gains	124	120
Gross Unrealized Losses	38	51
Estimated Fair Value	4,921	5,073
Unrealized OTTI Losses (Gains)	(27)	(28)
Commercial mortgage-backed
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	1,907	2,016
Gross Unrealized Gains	59	48
Gross Unrealized Losses	14	24
Estimated Fair Value	1,952	2,040
Unrealized OTTI Losses (Gains)	0	0
Other asset-backed
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	1,050	1,022
Gross Unrealized Gains	16	8
Gross Unrealized Losses	5	5
Estimated Fair Value	1,061	1,025
Unrealized OTTI Losses (Gains)	0	0
Total asset-backed
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	7,792	8,042
Gross Unrealized Gains	199	176
Gross Unrealized Losses	57	80
Estimated Fair Value	7,934	8,138
Unrealized OTTI Losses (Gains)	(27)	(28)
U.S. Treasury and obligations of government-sponsored enterprises
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	113	83
Gross Unrealized Gains	4	10
Gross Unrealized Losses	2	0
Estimated Fair Value	115	93
Unrealized OTTI Losses (Gains)	0	0
Foreign government
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	438	435
Gross Unrealized Gains	12	13
Gross Unrealized Losses	1	3
Estimated Fair Value	449	445
Unrealized OTTI Losses (Gains)	0	0
Redeemable preferred stock
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	18	18
Gross Unrealized Gains	1	1
Gross Unrealized Losses	0	0
Estimated Fair Value	19	19
Unrealized OTTI Losses (Gains)	0	0
Total fixed maturity securities available-for-sale
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	38,645	38,349
Gross Unrealized Gains	3,185	2,736
Gross Unrealized Losses	104	192
Estimated Fair Value	41,726	40,893
Unrealized OTTI Losses (Gains)	(40)	(45)
Total fixed maturity securities trading
Schedule of Available-for-Sale and Trading Securities [Line Items]
Total fixed maturity securities trading, cost	23	12
Total fixed maturity securities trading, fair value	23	12
Equity securities available-for-sale -- Common stock
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	17	13
Gross Unrealized Gains	5	6
Gross Unrealized Losses	0	0
Estimated Fair Value	22	19
Preferred stock
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	91	93
Gross Unrealized Gains	6	2
Gross Unrealized Losses	1	4
Estimated Fair Value	96	91
Equity securities
Schedule of Available-for-Sale and Trading Securities [Line Items]
Cost or Amortized Cost	108	106
Gross Unrealized Gains	11	8
Gross Unrealized Losses	1	4
Estimated Fair Value	$ 118	$ 110

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Investments - Securities in a gross unrealized loss position (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	$ 4,600	$ 6,989
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	91	167
Estimated fair value, 12 months or longer	356	584
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	14	29
Estimated fair value, total	4,956	7,573
Available-for-sale securities, continuous unrealized loss position, accumulated loss	105	196
Corporate and other bonds
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	1,314	2,615
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	26	61
Estimated fair value, 12 months or longer	52	254
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	3	15
Estimated fair value, total	1,366	2,869
Available-for-sale securities, continuous unrealized loss position, accumulated loss	29	76
States, municipalities and political subdivisions
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	742	959
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	15	32
Estimated fair value, 12 months or longer	24	23
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	0	1
Estimated fair value, total	766	982
Available-for-sale securities, continuous unrealized loss position, accumulated loss	15	33
Residential mortgage-backed
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	1,722	2,136
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	34	44
Estimated fair value, 12 months or longer	141	201
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	4	7
Estimated fair value, total	1,863	2,337
Available-for-sale securities, continuous unrealized loss position, accumulated loss	38	51
Commercial mortgage-backed
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	473	756
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	8	22
Estimated fair value, 12 months or longer	125	69
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	6	2
Estimated fair value, total	598	825
Available-for-sale securities, continuous unrealized loss position, accumulated loss	14	24
Other asset-backed
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	159	398
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	4	5
Estimated fair value, 12 months or longer	14	24
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	1	0
Estimated fair value, total	173	422
Available-for-sale securities, continuous unrealized loss position, accumulated loss	5	5
Total asset-backed
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	2,354	3,290
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	46	71
Estimated fair value, 12 months or longer	280	294
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	11	9
Estimated fair value, total	2,634	3,584
Available-for-sale securities, continuous unrealized loss position, accumulated loss	57	80
U.S. Treasury and obligations of government-sponsored enterprises
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	65	5
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	2	0
Estimated fair value, 12 months or longer	0	0
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	0	0
Estimated fair value, total	65	5
Available-for-sale securities, continuous unrealized loss position, accumulated loss	2	0
Foreign government
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	109	108
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	1	3
Estimated fair value, 12 months or longer	0	0
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	0	0
Estimated fair value, total	109	108
Available-for-sale securities, continuous unrealized loss position, accumulated loss	1	3
Total fixed maturity securities available-for-sale
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	4,584	6,977
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	90	167
Estimated fair value, 12 months or longer	356	571
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	14	25
Estimated fair value, total	4,940	7,548
Available-for-sale securities, continuous unrealized loss position, accumulated loss	104	192
Equity securities available-for-sale -- Common stock
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	1
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	0
Estimated fair value, 12 months or longer	0
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	0
Estimated fair value, total	1
Available-for-sale securities, continuous unrealized loss position, accumulated loss	0
Equity securities available-for-sale -- Preferred stock
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	15	12
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	1	0
Estimated fair value, 12 months or longer	0	13
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	0	4
Estimated fair value, total	15	25
Available-for-sale securities, continuous unrealized loss position, accumulated loss	1	$ 4
Equity securities
Schedule of Available-for-sale Securities [Line Items]
Estimated fair value, less than 12 months	16
Available-for-sale securities, continuous unrealized loss position, less than 12 months, accumulated loss	1
Estimated fair value, 12 months or longer	0
Available-for-sale securities, continuous unrealized loss position, 12 months or longer, accumulated loss	0
Estimated fair value, total	16
Available-for-sale securities, continuous unrealized loss position, accumulated loss	$ 1

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Investments - Activity related to the pretax fixed maturity credit loss component reflected within retained earnings for securities still held for which a portion of an OTTI loss was recognized in OCI (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
Beginning balance of credit losses on fixed maturity securities	$ 32	$ 48	$ 36	$ 53
Reductions for securities sold during the period	(2)	(7)	(6)	(12)
Ending balance of credit losses on fixed maturity securities	$ 30	$ 41	$ 30	$ 41

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Investments - Contractual maturity (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Available-for-sale Securities, Debt Maturities, Single Maturity Date, Amortized Cost Basis [Abstract]
Due in one year or less, cost or amortized cost	$ 1,590	$ 1,779
Due after one year through five years, cost or amortized cost	7,732	7,566
Due after five years through ten years, cost or amortized cost	15,754	15,892
Due after ten years, cost or amortized cost	13,569	13,112
Total Amortized Cost Basis	38,645	38,349
Available-for-sale Securities, Debt Maturities, Single Maturity Date [Abstract]
Due in one year or less, estimated fair value	1,628	1,828
Due after one year through five years, estimated fair value	8,098	7,955
Due after five years through ten years, estimated fair value	16,404	16,332
Due after ten years, estimated fair value	15,596	14,778
Total Estimated Fair Value	$ 41,726	$ 40,893

XML

Fair Value - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Fair Value Disclosures [Abstract]
Fair value, assets, level 2 to level 1, transfers	$ 0	$ 0	$ 0	$ 0
Fair value, assets, level 1 to level 2, transfers	0	$ 0	0	$ 0
Other invested assets overseas deposit	37,000,000		37,000,000		$ 31,000,000
Life settlement contracts, escrow amount	1,000,000		$ 1,000,000
Life settlement contracts, receivable, payment period			3 years
Life settlement contracts, fair value	$ 1,000,000		$ 1,000,000		$ 58,000,000

XML

Fair Value - Assets and liabilities measured at fair value on a recurring basis (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	$ 43,114	$ 42,406
Liabilities	1	(3)
Corporate and other bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	19,406	18,970
States, municipalities and political subdivisions
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	13,826	13,240
Residential mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	4,921	5,073
Commercial mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1,952	2,040
Other asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1,061	1,025
Total asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	7,934	8,138
U.S. Treasury and obligations of government-sponsored enterprises
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	115	93
Foreign government
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	449	445
Redeemable preferred stock
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	19	19
Fixed maturity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	41,749	40,905
Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	118	110
Other invested assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	5	5
Short term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1,241	1,328
Life settlement contracts, included in Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1	58
Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities	1	(3)
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	493	678
Liabilities	0	0
Level 1 | Corporate and other bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | States, municipalities and political subdivisions
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Residential mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Commercial mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Other asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Total asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | U.S. Treasury and obligations of government-sponsored enterprises
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	115	93
Level 1 | Foreign government
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Redeemable preferred stock
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	19	19
Level 1 | Fixed maturity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	134	112
Level 1 | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	99	91
Level 1 | Other invested assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Short term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	260	475
Level 1 | Life settlement contracts, included in Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 1 | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	42,282	41,321
Liabilities	1	(3)
Level 2 | Corporate and other bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	19,306	18,840
Level 2 | States, municipalities and political subdivisions
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	13,825	13,239
Level 2 | Residential mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	4,798	4,944
Level 2 | Commercial mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1,939	2,027
Level 2 | Other asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	979	968
Level 2 | Total asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	7,716	7,939
Level 2 | U.S. Treasury and obligations of government-sponsored enterprises
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 2 | Foreign government
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	449	445
Level 2 | Redeemable preferred stock
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 2 | Fixed maturity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	41,296	40,463
Level 2 | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 2 | Other invested assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	5	5
Level 2 | Short term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	981	853
Level 2 | Life settlement contracts, included in Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 2 | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities	1	(3)
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	339	407
Liabilities	0	0
Level 3 | Corporate and other bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	100	130
Level 3 | States, municipalities and political subdivisions
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1	1
Level 3 | Residential mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	123	129
Level 3 | Commercial mortgage-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	13	13
Level 3 | Other asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	82	57
Level 3 | Total asset-backed
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	218	199
Level 3 | U.S. Treasury and obligations of government-sponsored enterprises
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 3 | Foreign government
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 3 | Redeemable preferred stock
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 3 | Fixed maturity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	319	330
Level 3 | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	19	19
Level 3 | Other invested assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 3 | Short term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	0	0
Level 3 | Life settlement contracts, included in Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	1	58
Level 3 | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities	$ 0	$ 0

XML

Fair Value - Reconciliation for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	$ 443	$ 491	$ 407	$ 473
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	1	8	8	12
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	2	4	6	7
Purchases	13	139	57	201
Sales	(46)	(45)	(63)	(61)
Settlements	(18)	(32)	(43)	(46)
Transfers into Level 3	24	3	52	5
Transfers out of Level 3	(80)	(48)	(85)	(71)
Balance, end of year	339	520	339	520
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	(3)	0	(3)
Corporate and other bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	121	193	130	168
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	0	1	0	0
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	0	3	1	7
Purchases	0	94	5	147
Sales	0	(20)	(1)	(36)
Settlements	(11)	(7)	(25)	(10)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	(10)	(22)	(10)	(34)
Balance, end of year	100	242	100	242
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
States, municipalities and political subdivisions
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	1	2	1	2
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	0	0	0	0
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	0	0	0	0
Purchases	0	0	0	0
Sales	0	0	0	0
Settlements	0	0	0	0
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Balance, end of year	1	2	1	2
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Residential mortgage-backed
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	126	128	129	134
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	1	1	2	2
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	1	(1)	3	(1)
Purchases	0	10	0	10
Sales	0	0	0	0
Settlements	(5)	(4)	(11)	(9)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	(2)
Balance, end of year	123	134	123	134
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Commercial mortgage-backed
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	13	27	13	22
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	0	0	0	0
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	0	0	0	0
Purchases	0	0	0	9
Sales	0	0	0	0
Settlements	0	(9)	0	(9)
Transfers into Level 3	0	3	0	3
Transfers out of Level 3	0	(10)	0	(14)
Balance, end of year	13	11	13	11
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Other asset-backed
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	117	50	57	53
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	0	0	(1)	0
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	0	2	0	2
Purchases	13	35	51	35
Sales	0	(25)	0	(25)
Settlements	(2)	(1)	(2)	(1)
Transfers into Level 3	24	0	52	2
Transfers out of Level 3	(70)	(16)	(75)	(21)
Balance, end of year	82	45	82	45
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Total asset-backed
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	256	205	199	209
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	1	1	1	2
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	1	1	3	1
Purchases	13	45	51	54
Sales	0	(25)	0	(25)
Settlements	(7)	(14)	(13)	(19)
Transfers into Level 3	24	3	52	5
Transfers out of Level 3	(70)	(26)	(75)	(37)
Balance, end of year	218	190	218	190
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Total fixed maturity securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	378	400	330	379
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	1	2	1	2
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	1	4	4	8
Purchases	13	139	56	201
Sales	0	(45)	(1)	(61)
Settlements	(18)	(21)	(38)	(29)
Transfers into Level 3	24	3	52	5
Transfers out of Level 3	(80)	(48)	(85)	(71)
Balance, end of year	319	434	319	434
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Equity securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	19	19	19	20
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	0	0	0	0
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	1	0	2	(1)
Purchases	0	0	1	0
Sales	(1)	0	(3)	0
Settlements	0	0	0	0
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Balance, end of year	19	19	19	19
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	0	0	0	0
Derivative financial instruments
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year			0
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)			1
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)			0
Purchases			0
Sales			(1)
Settlements			0
Transfers into Level 3			0
Transfers out of Level 3			0
Balance, end of year	0		0
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance			0
Life settlement contracts, included in Other assets
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of year	46	72	58	74
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)	0	6	6	10
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)	0	0	0	0
Purchases	0	0	0	0
Sales	(45)	0	(58)	0
Settlements	0	(11)	(5)	(17)
Transfers into Level 3	0	0	0	0
Transfers out of Level 3	0	0	0	0
Balance, end of year	1	67	1	67
Unrealized gains (losses) on Level 3 assets and liabilities, ending balance	$ 0	$ (3)	$ 0	$ (3)

XML

Fair Value - Quantitative information about significant unobservable inputs in the fair value measurement of level 3 assets (Details) - Fixed maturity securities - Income Approach Valuation Technique - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Estimated Fair Value (In millions)	$ 125	$ 106
Minimum
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Credit spread	2.00%	2.00%
Maximum
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Credit spread	40.00%	40.00%
Weighted Average
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Credit spread	4.00%	4.00%

XML

Fair Value - Carrying amount and estimated fair value of financial instrument assets and liabilities which are not measured at fair value (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Assets
Mortgage loans	$ 646	$ 591
Liabilities
Short term debt	150	0
Long term debt	2,561	2,710
Carrying Amount
Assets
Mortgage loans	646	591
Note receivable	45
Liabilities
Short term debt	150
Long term debt	2,561	2,710
Estimated Fair Value
Assets
Mortgage loans	655	594
Note receivable	45
Liabilities
Short term debt	154
Long term debt	2,819	2,952
Level 1 | Estimated Fair Value
Assets
Mortgage loans	0	0
Note receivable	0
Liabilities
Short term debt	0
Long term debt	0	0
Level 2 | Estimated Fair Value
Assets
Mortgage loans	0	0
Note receivable	0
Liabilities
Short term debt	154
Long term debt	2,819	2,952
Level 3 | Estimated Fair Value
Assets
Mortgage loans	655	594
Note receivable	45
Liabilities
Short term debt	0
Long term debt	$ 0	$ 0

XML

Claim and Claim Adjustment Expense Reserves - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Dec. 31, 2010
Liability for Claims and Claims Adjustment Expense [Line Items]
Catastrophe losses net of reinsurance	$ 39,000,000	$ 85,000,000	$ 73,000,000	$ 121,000,000
Loss Portfolio Transfer
Liability for Claims and Claims Adjustment Expense [Line Items]
Net A&EP claim and allocated claim adjustment expense reserves ceded to NICO						$ 1,600,000,000
Aggregate limit under A&EP Loss Portfolio Transfer						4,000,000,000
A&EP claim and allocated claim adjustment expense reserves ceded under existing third party reinsurance contracts transferred to NICO under A&EP Loss Portfolio Transfer						1,200,000,000
Reinsurance premium paid to NICO under A&EP Loss Portfolio Transfer						2,000,000,000
Net reinsurance receivables transferred to NICO under A&EP Loss Portfolio Transfer						215,000,000
Total consideration paid to NICO under AEP Loss Portfolio Transfer						$ 2,200,000,000
Net A&EP adverse development before consideration of LPT	0	$ 0	60,000,000	$ 200,000,000
Cumulative amounts ceded under AEP Loss Portfolio Transfer	2,900,000,000		2,900,000,000		$ 2,800,000,000
Deferred reinsurance benefit yet to be recognized	351,000,000		351,000,000		334,000,000
Fair value of collateral trust account established by NICO under A&EP Loss Portfolio Transfer	$ 2,800,000,000		$ 2,800,000,000		$ 2,800,000,000

XML

Claim and Claim Adjustment Expense Reserves - Reconciliation of claim and claim adjustment expense reserves (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward]
Gross, beginning of year	$ 22,343	$ 22,663
Ceded, beginning of year	4,094	4,087
Net reserves, beginning of year	18,249	18,576
Net incurred claim and claim adjustment expenses:
Provision for insured events of current year	2,443	2,583
Decrease in provision for insured events of prior years	(159)	(198)
Amortization of discount	93	93
Total net incurred	2,377	2,478
Net payments attributable to:
Current year events	(266)	(311)
Prior year events	(2,331)	(2,185)
Total net payments	(2,597)	(2,496)
Foreign currency translation adjustment and other	70	46
Net reserves, end of period	18,099	18,604
Ceded reserves, end of year	4,080	4,371
Gross reserves, end of year	$ 22,179	$ 22,975

XML

Claim and Claim Adjustment Expense Reserves - Net prior year development (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Segment Reporting Information [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ (55)	$ (98)	$ (112)	$ (150)
Pretax (favorable) unfavorable premium development	(8)	(8)	17	(22)
Total pretax (favorable) unfavorable net prior year development	(63)	(106)	(95)	(172)
Specialty
Segment Reporting Information [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	(23)	(65)	(54)	(99)
Pretax (favorable) unfavorable premium development	(5)	(7)	(10)	(18)
Total pretax (favorable) unfavorable net prior year development	(28)	(72)	(64)	(117)
Commercial
Segment Reporting Information [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	(34)	(18)	(58)	(32)
Pretax (favorable) unfavorable premium development	1	(2)	38	(4)
Total pretax (favorable) unfavorable net prior year development	(33)	(20)	(20)	(36)
International
Segment Reporting Information [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	2	(15)	0	(19)
Pretax (favorable) unfavorable premium development	(4)	1	(11)	0
Total pretax (favorable) unfavorable net prior year development	(2)	(14)	(11)	(19)
Corporate & Other Non-Core
Segment Reporting Information [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	0	0	0	0
Pretax (favorable) unfavorable premium development	0	0	0	0
Total pretax (favorable) unfavorable net prior year development	$ 0	$ 0	$ 0	$ 0

XML

Claim and Claim Adjustment Expense Reserves - Net prior year claim and allocated claim adjustment expense reserve development for Specialty segment (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Liability for Claims and Claims Adjustment Expense [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ (55)	$ (98)	$ (112)	$ (150)
Specialty
Liability for Claims and Claims Adjustment Expense [Line Items]
Medical Professional Liability	3	(23)	4	(30)
Other Professional Liability and Management Liability	(37)	(41)	(69)	(50)
Surety	0	0	0	0
Warranty	6	3	6	5
Other	5	(4)	5	(24)
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ (23)	$ (65)	$ (54)	$ (99)

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Claim and Claim Adjustment Expense Reserves - Net prior year claim and allocated claim adjustment expense reserve development for Commercial segment (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Liability for Claims and Claims Adjustment Expense [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ (55)	$ (98)	$ (112)	$ (150)
Commercial
Liability for Claims and Claims Adjustment Expense [Line Items]
Commercial Auto	0	(20)	(26)	(35)
General Liability	(1)	(37)	(1)	(52)
Workers' Compensation	(46)	50	(46)	54
Property and Other	13	(11)	15	1
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ (34)	$ (18)	$ (58)	$ (32)

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Claim and Claim Adjustment Expense Reserves - Net prior year claim and allocated claim adjustment expense reserve development for International segment (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Liability for Claims and Claims Adjustment Expense [Line Items]
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ (55)	$ (98)	$ (112)	$ (150)
International
Liability for Claims and Claims Adjustment Expense [Line Items]
Medical Professional Liability	(5)	(1)	(5)	(1)
Other Professional Liability	10	18	9	17
Liability	(5)	(19)	(5)	(19)
Property & Marine	(12)	(3)	(11)	(7)
Other	14	(10)	12	(9)
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development	$ 2	$ (15)	$ 0	$ (19)

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Claim and Claim Adjustment Expense Reserves - Impact of Loss Portfolio Transfer on the Consolidated Statement of Operations (Details) - Loss Portfolio Transfer - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Liability for Claims and Claims Adjustment Expense [Line Items]
Net A&EP adverse development before consideration of LPT	$ 0	$ 0	$ 60	$ 200
Retroactive reinsurance benefit recognized	(3)	(9)	(43)	(82)
Pretax impact of A&EP reserve development and the LPT	$ (3)	$ (9)	$ 17	$ 118

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Legal Proceedings and Guarantees - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Adverse premium development recognized as result of rating errors	$ 1	$ 37
Guarantee Obligations
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Guarantor obligations, maximum exposure, undiscounted	1,800	1,800
Indemnification Agreement
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Guarantor obligations, maximum exposure, undiscounted	254	254
Guarantee agreement
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Guarantor obligations, maximum exposure, undiscounted	434	434
Guarantee and Indemnification
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Guarantor obligations, current carrying value	5	5	$ 5
Insurance Premium Rate Adjustment
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Interest due to policyholders	1	6
Multi-Peril Package Product | Insurance Premium Rate Adjustment
Legal Proceedings, Commitments and Contingencies, and Guarantees [Line Items]
Loss contingency accrual	$ 96	$ 96

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Benefit Plans - Components of net periodic cost (benefit) (Details) - Pension Plans, Defined Benefit - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Defined Benefit Plan Disclosure [Line Items]
Interest cost on projected benefit obligation	$ 26	$ 28	$ 52	$ 56
Expected return on plan assets	(39)	(40)	(78)	(80)
Amortization of net actuarial loss	9	10	18	19
Settlement loss	0	0	2	0
Net periodic pension cost (benefit)	$ (4)	$ (2)	$ (6)	$ (5)

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Accumulated Other Comprehensive Income (Loss) by Component - Changes in accumulated other comprehensive income (loss) by component (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of year			$ 11,969
Other comprehensive income (loss) before reclassifications	$ 149	$ 274	245	$ 514
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit	25	8	40	(11)
Other comprehensive income (loss) after tax (expense) benefit	124	266	205	525
Balance, end of period	12,028	11,886	12,028	11,886
Reclassification from AOCI, current period, tax	(11)	(3)	(18)	8
Tax (expense) benefit on other comprehensive income (loss)	(51)	(159)	(92)	(281)
Net unrealized gains (losses) on investments with OTTI losses
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of year	26	32	30	27
Other comprehensive income (loss) before reclassifications	(1)	(1)	(1)	2
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit	(1)	0	3	(2)
Other comprehensive income (loss) after tax (expense) benefit	0	(1)	(4)	4
Balance, end of period	26	31	26	31
Reclassification from AOCI, current period, tax	1	0	(1)	1
Tax (expense) benefit on other comprehensive income (loss)	0	1	1	(2)
Net unrealized gains (losses) on other investments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of year	709	624	642	390
Other comprehensive income (loss) before reclassifications	108	323	193	546
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit	31	13	49	2
Other comprehensive income (loss) after tax (expense) benefit	77	310	144	544
Balance, end of period	786	934	786	934
Reclassification from AOCI, current period, tax	(15)	(6)	(24)	1
Tax (expense) benefit on other comprehensive income (loss)	(48)	(157)	(86)	(273)
Pension and postretirement benefits
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of year	(640)	(642)	(647)	(648)
Other comprehensive income (loss) before reclassifications	0	0	0	0
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit	(5)	(5)	(12)	(11)
Other comprehensive income (loss) after tax (expense) benefit	5	5	12	11
Balance, end of period	(635)	(637)	(635)	(637)
Reclassification from AOCI, current period, tax	3	3	7	6
Tax (expense) benefit on other comprehensive income (loss)	(3)	(3)	(7)	(6)
Cumulative foreign currency translation adjustment
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of year	(187)	(70)	(198)	(84)
Other comprehensive income (loss) before reclassifications	42	(48)	53	(34)
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit	0	0	0	0
Other comprehensive income (loss) after tax (expense) benefit	42	(48)	53	(34)
Balance, end of period	(145)	(118)	(145)	(118)
Reclassification from AOCI, current period, tax	0	0	0	0
Tax (expense) benefit on other comprehensive income (loss)	0	0	0	0
AOCI Attributable to Parent
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of year	(92)	(56)	(173)	(315)
Balance, end of period	$ 32	$ 210	$ 32	$ 210

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Business Segments - Narrative (Details)	6 Months Ended
	Jun. 30, 2017 segments
Core Segments - Specialty, Commercial and International
Segment Reporting Information [Line Items]
Number of operating segments	3
Non-Core Segments - Life & Group Non-Core and Corporate and Other Non-Core
Segment Reporting Information [Line Items]
Number of operating segments	2

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Business Segments - Income Statement Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Operating revenues
Net earned premiums	$ 1,734	$ 1,730	$ 3,379	$ 3,429
Net investment income	475	502	1,020	937
Other revenues	107	100	211	197
Total operating revenues	2,316	2,332	4,610	4,563
Claims, Benefits and Expenses
Net incurred claims and benefits	1,275	1,335	2,564	2,739
Policyholders’ dividends	5	4	9	8
Amortization of deferred acquisition costs	312	305	617	612
Other insurance related expenses	261	270	515	547
Other expenses	143	146	278	292
Total claims, benefits and expenses	1,996	2,060	3,983	4,198
Operating income (loss) before income tax	320	272	627	365
Income tax (expense) benefit on operating income (loss)	(81)	(71)	(153)	(73)
Net operating income (loss)	239	201	474	292
Net realized investment gains (losses)	50	16	86	(20)
Income tax (expense) benefit on net realized investment gains (losses)	(17)	(8)	(28)	3
Net realized investment gains (losses), after tax	33	8	58	(17)
Net income (loss)	272	209	532	275
Operating Segments | Specialty
Operating revenues
Net earned premiums	689	702	1,353	1,384
Net investment income	120	133	273	240
Other revenues	98	89	192	176
Total operating revenues	907	924	1,818	1,800
Claims, Benefits and Expenses
Net incurred claims and benefits	398	377	784	767
Policyholders’ dividends	1	1	2	2
Amortization of deferred acquisition costs	149	148	292	292
Other insurance related expenses	72	73	141	148
Other expenses	82	79	163	154
Total claims, benefits and expenses	702	678	1,382	1,363
Operating income (loss) before income tax	205	246	436	437
Income tax (expense) benefit on operating income (loss)	(69)	(82)	(146)	(146)
Net operating income (loss)	136	164	290	291
Net realized investment gains (losses)	14	4	21	(7)
Income tax (expense) benefit on net realized investment gains (losses)	(5)	(2)	(8)	2
Net realized investment gains (losses), after tax	9	2	13	(5)
Net income (loss)	145	166	303	286
Operating Segments | Commercial
Operating revenues
Net earned premiums	705	696	1,356	1,384
Net investment income	143	164	321	290
Other revenues	9	8	18	14
Total operating revenues	857	868	1,695	1,688
Claims, Benefits and Expenses
Net incurred claims and benefits	422	469	859	911
Policyholders’ dividends	4	3	7	6
Amortization of deferred acquisition costs	118	117	234	233
Other insurance related expenses	128	130	254	271
Other expenses	11	11	25	16
Total claims, benefits and expenses	683	730	1,379	1,437
Operating income (loss) before income tax	174	138	316	251
Income tax (expense) benefit on operating income (loss)	(59)	(46)	(107)	(85)
Net operating income (loss)	115	92	209	166
Net realized investment gains (losses)	19	8	30	(10)
Income tax (expense) benefit on net realized investment gains (losses)	(6)	(3)	(9)	3
Net realized investment gains (losses), after tax	13	5	21	(7)
Net income (loss)	128	97	230	159
Operating Segments | International
Operating revenues
Net earned premiums	206	197	403	395
Net investment income	13	13	25	25
Other revenues	(1)	0	(1)	1
Total operating revenues	218	210	427	421
Claims, Benefits and Expenses
Net incurred claims and benefits	129	157	244	278
Policyholders’ dividends	0	0	0	0
Amortization of deferred acquisition costs	45	40	91	87
Other insurance related expenses	31	37	58	65
Other expenses	(1)	7	(7)	16
Total claims, benefits and expenses	204	241	386	446
Operating income (loss) before income tax	14	(31)	41	(25)
Income tax (expense) benefit on operating income (loss)	(4)	4	(11)	4
Net operating income (loss)	10	(27)	30	(21)
Net realized investment gains (losses)	7	4	13	8
Income tax (expense) benefit on net realized investment gains (losses)	(1)	(1)	(2)	(2)
Net realized investment gains (losses), after tax	6	3	11	6
Net income (loss)	16	(24)	41	(15)
Operating Segments | Life & Group Non-Core
Operating revenues
Net earned premiums	135	136	268	267
Net investment income	195	188	392	375
Other revenues	0	3	1	3
Total operating revenues	330	327	661	645
Claims, Benefits and Expenses
Net incurred claims and benefits	328	340	658	663
Policyholders’ dividends	0	0	0	0
Amortization of deferred acquisition costs	0	0	0	0
Other insurance related expenses	32	31	64	64
Other expenses	1	2	3	5
Total claims, benefits and expenses	361	373	725	732
Operating income (loss) before income tax	(31)	(46)	(64)	(87)
Income tax (expense) benefit on operating income (loss)	36	42	73	81
Net operating income (loss)	5	(4)	9	(6)
Net realized investment gains (losses)	7	(2)	17	(5)
Income tax (expense) benefit on net realized investment gains (losses)	(3)	(3)	(7)	(3)
Net realized investment gains (losses), after tax	4	(5)	10	(8)
Net income (loss)	9	(9)	19	(14)
Operating Segments | Corporate & Other Non-Core
Operating revenues
Net earned premiums	0	0	0	0
Net investment income	4	4	9	7
Other revenues	1	0	1	3
Total operating revenues	5	4	10	10
Claims, Benefits and Expenses
Net incurred claims and benefits	(2)	(8)	19	120
Policyholders’ dividends	0	0	0	0
Amortization of deferred acquisition costs	0	0	0	0
Other insurance related expenses	(1)	0	(1)	0
Other expenses	50	47	94	101
Total claims, benefits and expenses	47	39	112	221
Operating income (loss) before income tax	(42)	(35)	(102)	(211)
Income tax (expense) benefit on operating income (loss)	15	11	38	73
Net operating income (loss)	(27)	(24)	(64)	(138)
Net realized investment gains (losses)	3	2	5	(6)
Income tax (expense) benefit on net realized investment gains (losses)	(2)	1	(2)	3
Net realized investment gains (losses), after tax	1	3	3	(3)
Net income (loss)	(26)	(21)	(61)	(141)
Intersegment Eliminations
Operating revenues
Net earned premiums	(1)	(1)	(1)	(1)
Net investment income	0	0	0	0
Other revenues	0	0	0	0
Total operating revenues	(1)	(1)	(1)	(1)
Claims, Benefits and Expenses
Net incurred claims and benefits	0	0	0	0
Policyholders’ dividends	0	0	0	0
Amortization of deferred acquisition costs	0	0	0	0
Other insurance related expenses	(1)	(1)	(1)	(1)
Other expenses	0	0	0	0
Total claims, benefits and expenses	(1)	(1)	(1)	(1)
Operating income (loss) before income tax	0	0	0	0
Income tax (expense) benefit on operating income (loss)	0	0	0	0
Net operating income (loss)	0	0	0	0
Net realized investment gains (losses)	0	0	0	0
Income tax (expense) benefit on net realized investment gains (losses)	0	0	0	0
Net realized investment gains (losses), after tax	0	0	0	0
Net income (loss)	$ 0	$ 0	$ 0	$ 0

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Business Segments - Balance Sheet Information (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Reinsurance receivables	$ 4,464	$ 4,453
Insurance receivables	2,452	2,255
Deferred acquisition costs	647	600
Goodwill	147	145
Insurance reserves
Claim and claim adjustment expenses	22,179	22,343
Unearned premiums	4,107	3,762
Future policy benefits	10,824	10,326
Operating Segments | Specialty
Segment Reporting Information [Line Items]
Reinsurance receivables	880	760
Insurance receivables	1,020	982
Deferred acquisition costs	318	310
Goodwill	117	117
Insurance reserves
Claim and claim adjustment expenses	6,229	6,149
Unearned premiums	1,988	1,911
Future policy benefits	0	0
Operating Segments | Commercial
Segment Reporting Information [Line Items]
Reinsurance receivables	591	621
Insurance receivables	1,129	1,021
Deferred acquisition costs	234	214
Goodwill	0	0
Insurance reserves
Claim and claim adjustment expenses	8,586	8,894
Unearned premiums	1,481	1,323
Future policy benefits	0	0
Operating Segments | International
Segment Reporting Information [Line Items]
Reinsurance receivables	150	131
Insurance receivables	290	233
Deferred acquisition costs	95	76
Goodwill	30	28
Insurance reserves
Claim and claim adjustment expenses	1,442	1,328
Unearned premiums	500	396
Future policy benefits	0	0
Operating Segments | Life & Group Non-Core
Segment Reporting Information [Line Items]
Reinsurance receivables	461	462
Insurance receivables	11	17
Deferred acquisition costs	0	0
Goodwill	0	0
Insurance reserves
Claim and claim adjustment expenses	3,417	3,358
Unearned premiums	139	132
Future policy benefits	10,824	10,326
Operating Segments | Corporate & Other Non-Core
Segment Reporting Information [Line Items]
Reinsurance receivables	2,382	2,479
Insurance receivables	2	2
Deferred acquisition costs	0	0
Goodwill	0	0
Insurance reserves
Claim and claim adjustment expenses	2,505	2,614
Unearned premiums	0	0
Future policy benefits	0	0
Intersegment Eliminations
Segment Reporting Information [Line Items]
Reinsurance receivables	0	0
Insurance receivables	0	0
Deferred acquisition costs	0	0
Goodwill	0	0
Insurance reserves
Claim and claim adjustment expenses	0	0
Unearned premiums	(1)	0
Future policy benefits	$ 0	$ 0

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Business Segments - Revenues by Line of Business (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Segment Reporting Information [Line Items]
Revenues	$ 2,366	$ 2,348	$ 4,696	$ 4,543
Operating Segments | Specialty
Segment Reporting Information [Line Items]
Revenues	921	928	1,839	1,793
Operating Segments | Commercial
Segment Reporting Information [Line Items]
Revenues	876	876	1,725	1,678
Operating Segments | International
Segment Reporting Information [Line Items]
Revenues	225	214	440	429
Operating Segments | Life & Group Non-Core
Segment Reporting Information [Line Items]
Revenues	337	325	678	640
Operating Segments | Corporate & Other Non-Core
Segment Reporting Information [Line Items]
Revenues	8	6	15	4
Intersegment Eliminations
Segment Reporting Information [Line Items]
Revenues	(1)	(1)	(1)	(1)
Specialty | Operating Segments
Segment Reporting Information [Line Items]
Revenues	646	659	1,307	1,277
Surety | Operating Segments
Segment Reporting Information [Line Items]
Revenues	137	133	260	260
Warranty & Alternative Risks | Operating Segments
Segment Reporting Information [Line Items]
Revenues	138	136	272	256
Middle Market | Operating Segments
Segment Reporting Information [Line Items]
Revenues	462	434	920	835
Small Business | Operating Segments
Segment Reporting Information [Line Items]
Revenues	129	151	226	294
Other Commercial Insurance | Operating Segments
Segment Reporting Information [Line Items]
Revenues	285	291	579	549
Canada | Operating Segments
Segment Reporting Information [Line Items]
Revenues	53	51	104	101
CNA Europe | Operating Segments
Segment Reporting Information [Line Items]
Revenues	79	81	152	159
Hardy | Operating Segments
Segment Reporting Information [Line Items]
Revenues	$ 93	$ 82	$ 184	$ 169