Investments and Derivative Instruments Level 1 (Notes)

6 Months Ended

Jun. 30, 2016

Schedule of Investments [Abstract]

Investment Holdings [Text Block]

Net Realized Capital Gains (Losses)

	Three Months Ended June 30,						Six Months Ended June 30,
(Before-tax)	2016			2015			2016			2015
Gross gains on sales	$	61		$	65		$	91		$	184
Gross losses on sales	(13		)	(53		)	(60		)	(148		)
Net OTTI losses recognized in earnings	(1		)	(2		)	(11		)	(8		)
Valuation allowances on mortgage loans	—			—			—			(4		)
Periodic net coupon settlements on credit derivatives	(1		)	2			—			3
Results of variable annuity hedge program
GMWB derivatives, net	3			(4		)	(14		)	(3		)
Macro hedge program	(20		)	(23		)	(34		)	(27		)
Total results of variable annuity hedge program	(17		)	(27		)	(48		)	(30		)
Modified coinsurance reinsurance contracts	(25		)	37			(47		)	26
Other, net [1]	(1		)	(9		)	(39		)	(19		)
Net realized capital losses	$	3		$	13		$	(114	)	$	4

[1] Primarily consists of changes in value of non-qualifying derivatives and transactional foreign currency revaluation gains (losses). For the three months ended June 30, 2016 and 2015, transactional foreign currency revaluation gains (losses) were $(64) and $16, respectively, and related to yen denominated fixed payout annuity liabilities, which were largely offset by gains (losses) of $60 and $(17), respectively, on derivative instruments used to hedge the foreign currency exposure. For the six months ended June 30, 2016 and 2015, the transactional foreign currency revaluation gains (losses) were $(108) and $16, respectively, which were largely offset by gains (losses) of $96 and $(31), respectively, on the related hedging instruments.

Net realized capital gains and losses from investment sales, are reported as a component of revenues and are determined on a specific identification basis. Before tax, net gains and losses on sales and impairments previously reported as unrealized gains in AOCI were $47 and $21, respectively, for the three and six months endedJune 30, 2016, and $16 and $34 for the three and six months endedJune 30, 2015, respectively. Proceeds from sales of AFS securities totaled $1.7 billion and $3.9 billion, respectively, for the three and six months endedJune 30, 2016, and $2.5 billion and $5.6 billion for the three and six months endedJune 30, 2015, respectively.

Recognition and Presentation of Other-Than-Temporary Impairments

The Company deems bonds and certain equity securities with debt-like characteristics (collectively “debt securities”) to be other-than-temporarily impaired (“impaired”) if a security meets the following conditions: a) the Company intends to sell or it is more likely than not that the Company will be required to sell the security before a recovery in value, or b) the Company does not expect to recover the entire amortized cost basis of the security. If the Company intends to sell or it is more likely than not that the Company will be required to sell the security before a recovery in value, a charge is recorded in net realized capital losses equal to the difference between the fair value and amortized cost basis of the security. For those impaired debt securities which do not meet the first condition and for which the Company does not expect to recover the entire amortized cost basis, the difference between the security’s amortized cost basis and the fair value is separated into the portion representing a credit OTTI, which is recorded in net realized capital losses, and the remaining non-credit impairment, which is recorded in OCI. Generally, the Company determines a security’s credit impairment as the difference between its amortized cost basis and its best estimate of expected future cash flows discounted at the security’s effective yield prior to impairment. The remaining non-credit impairment is the difference between the security’s fair value and the Company’s best estimate of expected future cash flows discounted at the security’s effective yield prior to the impairment, which typically includes current market liquidity and risk premiums. The previous amortized cost basis less the impairment recognized in net realized capital losses becomes the security’s new cost basis. The Company accretes the new cost basis to the estimated future cash flows over the expected remaining life of the security by prospectively adjusting the security’s yield, if necessary.

The Company’s evaluation of whether a credit impairment exists for debt securities includes but is not limited to, the following factors: (a) changes in the financial condition of the security’s underlying collateral, (b) whether the issuer is current on contractually obligated interest and principal payments, (c) changes in the financial condition, credit rating and near-term prospects of the issuer, (d) the extent to which the fair value has been less than the amortized cost of the security and (e) the payment structure of the security. The Company’s best estimate of expected future cash flows used to determine the credit loss amount is a quantitative and qualitative process that incorporates information received from third-party sources along with certain internal assumptions and judgments regarding the future performance of the security. The Company’s best estimate of future cash flows involves assumptions including, but not limited to, earnings multiples, underlying asset valuations and various performance indicators, such as historical and projected default and recovery rates, credit ratings, current and projected delinquency rates, and loan-to-value ("LTV") ratios. In addition, for structured securities, the Company considers factors including, but not limited to, average cumulative collateral loss rates that vary by vintage year, commercial and residential property value declines that vary by property type and location and commercial real estate delinquency levels. These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries which may include estimating the underlying collateral value. In addition, projections of expected future debt security cash flows may change based upon new information regarding the performance of the issuer and/or underlying collateral such as changes in the projections of the underlying property value estimates.

For equity securities where the decline in the fair value is deemed to be other-than-temporary, a charge is recorded in net realized capital losses equal to the difference between the fair value and cost basis of the security. The previous cost basis less the impairment becomes the security’s new cost basis. The Company asserts its intent and ability to retain those equity securities deemed to be temporarily impaired until the price recovers. Once identified, these securities are systematically restricted from trading unless approved by investment and accounting professionals.

The primary factors considered in evaluating whether an impairment exists for an equity security may include, but are not limited to: (a) the length of time and extent to which the fair value has been less than the cost of the security, (b) changes in the financial condition, credit rating and near-term prospects of the issuer, (c) whether the issuer is current on preferred stock dividends and (d) the intent and ability of the Company to retain the investment for a period of time sufficient to allow for recovery.

The following table presents the Company's impairments by impairment type.

	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Credit impairments	$	1	$	—	$	9	$	2
Intent-to-sell impairments	—		2		1		6
Impairments on equity securities	—		—		1		—
Total impairments	$	1	$	2	$	11	$	8

The following table presents a roll-forward of the Company’s cumulative credit impairments on fixed maturities held.

	Three Months Ended June 30,						Six Months Ended June 30,
(Before-tax)	2016			2015			2016			2015
Balance as of beginning of period	$	(215	)	$	(288	)	$	(211	)	$	(296	)
Additions for credit impairments recognized on [1]:
Securities not previously impaired	—			—			(8		)	(2		)
Securities previously impaired	(1		)	—			(1		)	—
Reductions for credit impairments previously recognized on:
Securities that matured or were sold during the period	26			3			26			5
Securities due to an increase in expected cash flows	9			15			13			22
Securities the Company made the decision to sell or more likely than not will be required to sell	—			—			—			1
Balance as of end of period	$	(181	)	$	(270	)	$	(181	)	$	(270	)

[1] These additions are included in the net OTTI losses recognized in earnings in the Condensed Consolidated Statements of Operations.

Available-for-Sale Securities

The following table presents the Company’s AFS securities by type.

	June 30, 2016												December 31, 2015
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-Credit OTTI [1]			Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Non-Credit OTTI [1]
ABS	$	1,035	$	18	$	(34	)	$	1,019	$	—		$	864	$	16	$	(34	)	$	846	$	—
CDOs [2]	1,223		56		(11		)	1,269		—			1,354		67		(11		)	1,408		—
CMBS	2,066		91		(11		)	2,146		(2		)	1,936		52		(24		)	1,964		(3		)
Corporate	14,051		1,619		(76		)	15,594		(9		)	14,425		975		(225		)	15,175		(3		)
Foreign govt./govt. agencies	272		27		(3		)	296		—			328		14		(11		)	331		—
Municipal	1,090		192		—			1,282		—			1,057		80		(5		)	1,132		—
RMBS	1,686		54		(8		)	1,732		—			1,468		43		(8		)	1,503		—
U.S. Treasuries	1,969		393		—			2,362		—			2,127		184		(13		)	2,298		—
Total fixed maturities, AFS	23,392		2,450		(143		)	25,700		(11		)	23,559		1,431		(331		)	24,657		(6		)
Equity securities, AFS [3]	123		19		(6		)	136		—			178		11		(11		)	178		—
Total AFS securities	$	23,515	$	2,469	$	(149	)	$	25,836	$	(11	)	$	23,737	$	1,442	$	(342	)	$	24,835	$	(6	)

[1] Represents the amount of cumulative non-credit OTTI losses recognized in OCI on securities that also had credit impairments. These losses are included in gross unrealized losses as of June 30, 2016 and December 31, 2015.

[2] Gross unrealized gains (losses) exclude the fair value of bifurcated embedded derivatives within certain securities. Subsequent changes in value are recorded in net realized capital gains (losses).

[3] Excluded equity securities, FVO, with a cost and fair value of $293 and $281 as of December 31, 2015. The Company did not hold any equity securities, FVO as of June 30, 2016.

The following table presents the Company’s fixed maturities, AFS, by contractual maturity year.

	June 30, 2016				December 31, 2015
Contractual Maturity	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	846	$	853	$	953	$	974
Over one year through five years	4,621		4,816		4,973		5,075
Over five years through ten years	3,870		4,096		3,650		3,714
Over ten years	8,045		9,769		8,361		9,173
Subtotal	17,382		19,534		17,937		18,936
Mortgage-backed and asset-backed securities	6,010		6,166		5,622		5,721
Total fixed maturities, AFS	$	23,392	$	25,700	$	23,559	$	24,657

Estimated maturities may differ from contractual maturities due to security call or prepayment provisions. Due to the potential for variability in payment speeds (i.e. prepayments or extensions), mortgage-backed and asset-backed securities are not categorized by contractual maturity.

Concentration of Credit Risk

The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk. The Company had no investment exposure to any credit concentration risk of a single issuer greater than 10% of the Company’s stockholders' equity, other than the U.S. government and certain U.S. government agencies as of June 30, 2016 and December 31, 2015. For further discussion of concentration of credit risk, see the Concentration of Credit Risk section in Note 3 - Investments and Derivative Instruments of Notes to Consolidated Financial Statements in the Company’s 2015 Form 10-K Annual Report.

Unrealized Losses on AFS Securities

The following tables present the Company’s unrealized loss aging for AFS securities by type and length of time the security was in a continuous unrealized loss position.

	June 30, 2016
	Less Than 12 Months							12 Months or More							Total
	Amortized Cost		Fair Value		Unrealized Losses			Amortized Cost		Fair Value		Unrealized Losses			Amortized Cost		Fair Value		Unrealized Losses
ABS	$	172	$	171	$	(1	)	$	309	$	276	$	(33	)	$	481	$	447	$	(34	)
CDOs [1]	431		429		(3		)	569		561		(8		)	1,000		990		(11		)
CMBS	183		179		(4		)	189		182		(7		)	372		361		(11		)
Corporate	862		831		(31		)	577		532		(45		)	1,439		1,363		(76		)
Foreign govt./govt. agencies	33		31		(2		)	35		34		(1		)	68		65		(3		)
Municipal	2		2		—			6		6		—			8		8		—
RMBS	187		186		(1		)	235		228		(7		)	422		414		(8		)
U.S. Treasuries	—		—		—			—		—		—			—		—		—
Total fixed maturities, AFS	1,870		1,829		(42		)	1,920		1,819		(101		)	3,790		3,648		(143		)
Equity securities, AFS [2]	30		28		(2		)	38		34		(4		)	68		62		(6		)
Total securities in an unrealized loss position	$	1,900	$	1,857	$	(44	)	$	1,958	$	1,853	$	(105	)	$	3,858	$	3,710	$	(149	)

	December 31, 2015
	Less Than 12 Months							12 Months or More							Total
	Amortized Cost		Fair Value		Unrealized Losses			Amortized Cost		Fair Value		Unrealized Losses			Amortized Cost		Fair Value		Unrealized Losses
ABS	$	387	$	385	$	(2	)	$	271	$	239	$	(32	)	$	658	$	624	$	(34	)
CDOs [1]	608		602		(6		)	500		493		(5		)	1,108		1,095		(11		)
CMBS	655		636		(19		)	99		94		(5		)	754		730		(24		)
Corporate	4,880		4,696		(184		)	363		322		(41		)	5,243		5,018		(225		)
Foreign govt./govt. agencies	144		136		(8		)	30		27		(3		)	174		163		(11		)
Municipal	179		174		(5		)	—		—		—			179		174		(5		)
RMBS	280		279		(1		)	230		223		(7		)	510		502		(8		)
U.S. Treasuries	963		950		(13		)	8		8		—			971		958		(13		)
Total fixed maturities, AFS	8,096		7,858		(238		)	1,501		1,406		(93		)	9,597		9,264		(331		)
Equity securities, AFS [2]	83		79		(4		)	44		37		(7		)	127		116		(11		)
Total securities in an unrealized loss position	$	8,179	$	7,937	$	(242	)	$	1,545	$	1,443	$	(100	)	$	9,724	$	9,380	$	(342	)

[1] Unrealized losses exclude the change in fair value of bifurcated embedded derivatives within certain securities, for which changes in fair value are recorded in net realized capital gains (losses).

[2] As of June 30, 2016 and December 31, 2015, excludes equity securities, FVO, which are included in equity securities, AFS on the Condensed Consolidated Balance Sheets.

As of June 30, 2016, AFS securities in an unrealized loss position, consisted of 1,625 securities, primarily in the corporate sector, as well as student loan ABS , which were depressed primarily due to widening of credit spreads since the securities were purchased. As of June 30, 2016, 90% of these securities were depressed less than 20% of cost or amortized cost. The decrease in unrealized losses during the first half of 2016 was primarily attributable to a decline in interest rates, as well as tighter credit spreads.

Most of the securities depressed for twelve months or more primarily relate to corporate securities concentrated in the financial services and energy sectors, structured securities with exposure to commercial and residential real estate, and student loan ABS. Corporate financial services securities and student loan ABS were primarily depressed because the securities have floating-rate coupons and have long-dated maturities, and current credit spreads are wider than when these securities were purchased. Corporate securities within the energy sector were primarily depressed due to a decline in oil and gas prices. For certain commercial and residential real estate securities, current market spreads are wider than spreads at the securities' respective purchase dates. The Company neither has an intention to sell nor does it expect to be required to sell the securities outlined in the preceding discussion.

Mortgage Loans

Mortgage Loan Valuation Allowances

The Company’s security monitoring process reviews mortgage loans on a quarterly basis to identify potential credit losses. Commercial mortgage loans are considered to be impaired when management estimates that, based upon current information and events, it is probable that the Company will be unable to collect amounts due according to the contractual terms of the loan agreement. Criteria used to determine if an impairment exists include, but are not limited to: current and projected macroeconomic factors, such as unemployment rates, and property-specific factors such as rental rates, occupancy levels, LTV ratios and debt service coverage ratios (“DSCR”). In addition, the Company considers historic, current and projected delinquency rates and property values. These assumptions require the use of significant management judgment and include the probability and timing of borrower default and loss severity estimates. In addition, projections of expected future cash flows may change based upon new information regarding the performance of the borrower and/or underlying collateral such as changes in the projections of the underlying property value estimates.

For mortgage loans that are deemed impaired, a valuation allowance is established for the difference between the carrying amount and the Company’s share of either (a) the present value of the expected future cash flows discounted at the loan’s effective interest rate, (b) the loan’s observable market price or, most frequently, (c) the fair value of the collateral. A valuation allowance has been established for either individual loans or as a projected loss contingency for loans with an LTV ratio of 90% or greater and after consideration of other credit quality factors, including DSCR. Changes in valuation allowances are recorded in net realized capital gains and losses. Interest income on impaired loans is accrued to the extent it is deemed collectible and the loans continue to perform under the original or restructured terms. Interest income ceases to accrue for loans when it is probable that the Company will not receive interest and principal payments according to the contractual terms of the loan agreement. Loans may resume accrual status when it is determined that sufficient collateral exists to satisfy the full amount of the loan and interest payments as well as when it is probable cash will be received in the foreseeable future. Interest income on defaulted loans is recognized when received.

	June 30, 2016							December 31, 2015
	Amortized Cost [1]		Valuation Allowance			Carrying Value		Amortized Cost [1]		Valuation Allowance			Carrying Value
Total commercial mortgage loans	$	2,890	$	(19	)	$	2,871	$	2,937	$	(19	)	$	2,918

[1] Amortized cost represents carrying value prior to valuation allowances, if any.

As of June 30, 2016, and December 31, 2015, the carrying value of mortgage loans associated with the valuation allowance was $31 and $39, respectively. There were no mortgage loans held-for-sale as of June 30, 2016 or December 31, 2015. As of June 30, 2016, loans within the Company’s mortgage loan portfolio that have had extensions or restructurings other than what is allowable under the original terms of the contract are immaterial.

The following table presents the activity within the Company’s valuation allowance for mortgage loans. These loans have been evaluated both individually and collectively for impairment. Loans evaluated collectively for impairment are immaterial.

	Six Months Ended June 30,
	2016			2015
Balance, beginning of period	$	(19	)	$	(15	)
(Additions)/Reversals	—			(4		)
Deductions	—			—
Balance, end of period	$	(19	)	$	(19	)

The weighted-average LTV ratio of the Company’s commercial mortgage loan portfolio was 55% as of June 30, 2016, while the weighted-average LTV ratio at origination of these loans was 63%. LTV ratios compare the loan amount to the value of the underlying property collateralizing the loan. The loan values are updated no less than annually through property level reviews of the portfolio. Factors considered in the property valuation include, but are not limited to, actual and expected property cash flows, geographic market data and capitalization rates. DSCR compares a property’s net operating income to the borrower’s principal and interest payments. The weighted average DSCR of the Company’s commercial mortgage loan portfolio was 2.43x as of June 30, 2016. As of June 30, 2016 and December 31, 2015, the Company held one delinquent commercial mortgage loan past due by 90 days or more. The loan had a total carrying value and valuation allowance of $15 and $16, respectively, and was not accruing income.

The following table presents the carrying value of the Company’s commercial mortgage loans by LTV and DSCR.

Commercial Mortgage Loans Credit Quality
	June 30, 2016			December 31, 2015
Loan-to-value	Carrying Value		Avg. Debt-Service Coverage Ratio	Carrying Value		Avg. Debt-Service Coverage Ratio
Greater than 80%	$	96	0.96x	$	15	0.91x
65% - 80%	236		2.09x	280		1.78x
Less than 65%	2,539		2.53x	2,623		2.54x
Total commercial mortgage loans	$	2,871	2.43x	$	2,918	2.45x

The following tables present the carrying value of the Company’s mortgage loans by region and property type.

Mortgage Loans by Region
	June 30, 2016			December 31, 2015
	Carrying Value		Percent of Total	Carrying Value		Percent of Total
East North Central	$	66	2.3%	$	66	2.3%
East South Central	14		0.5%	14		0.5%
Middle Atlantic	209		7.3%	210		7.2%
Mountain	4		0.1%	4		0.1%
New England	163		5.7%	163		5.6%
Pacific	898		31.3%	933		32.0%
South Atlantic	571		19.9%	579		19.8%
West North Central	1		—%	1		—%
West South Central	128		4.5%	125		4.3%
Other [1]	817		28.4%	823		28.2%
Total mortgage loans	$	2,871	100.0%	$	2,918	100.0%

[1] Primarily represents loans collateralized by multiple properties in various regions.

Mortgage Loans by Property Type
	June 30, 2016			December 31, 2015
	Carrying Value		Percent of Total	Carrying Value		Percent of Total
Commercial
Agricultural	$	16	0.5%	$	16	0.5%
Industrial	827		28.8%	829		28.4%
Lodging	25		0.9%	26		0.9%
Multifamily	559		19.5%	557		19.1%
Office	706		24.6%	729		25.0%
Retail	629		21.9%	650		22.3%
Other	109		3.8%	111		3.8%
Total mortgage loans	$	2,871	100.0%	$	2,918	100.0%

Variable Interest Entities

The Company is involved with various special purpose entities and other entities that are deemed to be VIEs primarily as a collateral or investment manager and as an investor through normal investment activities as well as a means of accessing capital through a contingent capital facility.

A VIE is an entity that either has investors that lack certain essential characteristics of a controlling financial interest, such as simple majority kick-out rights, or lacks sufficient funds to finance its own activities without financial support provided by other entities. The Company performs ongoing qualitative assessments of its VIEs to determine whether the Company has a controlling financial interest in the VIE and therefore is the primary beneficiary. The Company is deemed to have a controlling financial interest when it has both the ability to direct the activities that most significantly impact the economic performance of the VIE and the obligation to absorb losses or right to receive benefits from the VIE that could potentially be significant to the VIE. Based on the Company’s assessment, if it determines it is the primary beneficiary, the Company consolidates the VIE in the Company’s Condensed Consolidated Financial Statements.

Consolidated VIEs

The following table presents the carrying value of assets and liabilities, and the maximum exposure to loss relating to the VIEs for which the Company is the primary beneficiary. Creditors have no recourse against the Company in the event of default by these VIEs nor does the Company have any implied or unfunded commitments to these VIEs. The Company’s financial or other support provided to these VIEs is limited to its collateral or investment management services and original investment.

	June 30, 2016						December 31, 2015
	Total Assets		Total Liabilities  [1]		Maximum Exposure to Loss [2]		Total Assets		Total Liabilities  [1]		Maximum Exposure to Loss [2]
Investment funds [3]	$	—	$	—	$	—	$	52	$	11	$	42
Limited partnerships and other alternative investments [4]	7		—		7		2		1		1
Total	$	7	$	—	$	7	$	54	$	12	$	43

[1] Included in other liabilities on the Company’s Condensed Consolidated Balance Sheets.

[2] The maximum exposure to loss represents the maximum loss amount that the Company could recognize as a reduction in net investment income or as a realized capital loss and is the cost basis of the Company’s investment.

[3] Total assets included in fixed maturities, FVO, short-term investments, and equity, AFS on the Company’s Condensed Consolidated Balance Sheets.

[4] Total assets included in limited partnerships and other alternative investments, short-term investments, and other assets on the Company’s Condensed Consolidated Balance Sheets.

Effective January 1, 2016, the Company adopted new consolidation guidance which resulted in a hedge fund of funds that is part of limited partnerships and other alternative investments and which was previously a voting interest entity to be consolidated as a VIE. This hedge fund of funds limited partnership is considered a VIE under the updated guidance and the Company has determined it is the primary beneficiary and will consolidate the VIE. As of June 30, 2016, this limited partnership has outstanding commitments totaling $20, which may be called by the underlying partnerships during the commitment period to fund the purchase of new investments. For further information on the adoption, see Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Condensed Consolidated Financial Statements.

Also as a result of the adoption, the Company determined that one investment fund, which was previously identified as a consolidated VIE and for which the Company has management and control of the investments, is a voting interest entity under the new consolidation guidance. The Company still owns a majority interest in the investment fund and the fund that is still consolidated on the Company's Condensed Consolidated Financial Statements; however, as a result of the new consolidation guidance, this investment fund is not included as a VIE in the table above.

Non-Consolidated VIEs

The Company, through normal investment activities, makes passive investments in limited partnerships and other alternative investments. Upon the adoption of the new consolidation guidance discussed above, these investments are now considered VIEs. For these non-consolidated VIEs, the Company has determined it is not the primary beneficiary as it has no ability to direct activities that could significantly affect the economic performance of the investments. The Company’s maximum exposure to loss as of June 30, 2016 and December 31, 2015 is limited to the total carrying value of $1 billion and $729, respectively, which are included in limited partnerships and other alternative investments in the Company's Condensed Consolidated Balance Sheets. As of June 30, 2016 and December 31, 2015, the Company has outstanding commitments totaling $392 and $299, respectively, which is committed to fund these investments and may be called by the partnership during the commitment period to fund the purchase of new investments and partnership expenses. These investments are generally of a passive nature in that the Company does not take an active role in management. For further discussion of these investments, see Equity Method Investments within Note 3 - Investments and Derivatives of Notes to Consolidated Financial Statements included in the Company’s 2015 Form 10-K Annual Report.

In addition, the Company also makes passive investments in structured securities issued by VIEs for which the Company is not the manager and, therefore, does not consolidate. These investments are included in ABS, CDOs, CMBS and RMBS in the Available-for-Sale Securities table and fixed maturities, FVO, in the Company’s Condensed Consolidated Balance Sheets. The Company has not provided financial or other support with respect to these investments other than its original investment. For these investments, the Company determined it is not the primary beneficiary due to the relative size of the Company’s investment in comparison to the principal amount of the structured securities issued by the VIEs, the level of credit subordination which reduces the Company’s obligation to absorb losses or right to receive benefits and the Company’s inability to direct the activities that most significantly impact the economic performance of the VIEs. The Company’s maximum exposure to loss on these investments is limited to the amount of the Company’s investment.

Securities Lending, Repurchase Agreements and Other Collateral Transactions

The Company participates in securities lending programs to generate additional income. Through these programs, certain fixed maturities within the corporate, foreign government/government agencies, and municipal sectors as well as equity securities are loaned from the Company’s portfolio to qualifying third-party borrowers in return for collateral in the form of cash or securities. Borrowers of these securities provide collateral of 102% and 105% of the fair value of the securities lent at the time of the loan for domestic and non-domestic securities, respectively. The borrower will return the securities to the Company for cash or securities collateral at maturity dates generally of 90 days or less. Security collateral on deposit from counterparties in connection with securities lending transactions may not be sold or re-pledged, except in the event of default, and is not reflected on the Company’s consolidated balance sheets. The fair value of the loaned securities is monitored and additional collateral is obtained if the fair value of the collateral falls below 100% of the fair value of the loaned securities. The agreements provide the counterparty the right to sell or re-pledge the securities transferred. If cash, rather than securities, is received as collateral, the cash is typically invested in short-term investments or fixed maturities and is reported as an asset on the consolidated balance sheets. Income associated with securities lending transactions is reported as a component of net investment income on the Company’s consolidated statements of operations. As of June 30, 2016, the fair value of securities on loan and the associated liability for cash collateral received was $69 and $70, respectively. As of December 31, 2015, the fair value of securities on loan and the associated liability for cash collateral received was $15 and $15, respectively.

From time to time, the Company enters into repurchase agreements and similar transactions to manage liquidity or to earn incremental spread income. A repurchase agreement is a transaction in which one party (transferor) agrees to sell securities to another party (transferee) in return for cash (or securities), with a simultaneous agreement to repurchase the same securities at a specified price at a later date. A dollar roll is a type of repurchase agreement where a mortgage backed security is sold with an agreement to repurchase substantially the same security at a specified time in the future. Repurchase transactions generally have a contractual maturity of ninety days or less.

As part of repurchase agreements, the Company transfers collateral of U.S. government and government agency securities and receives cash. For repurchase agreements, the Company obtains cash in an amount equal to at least 95% of the fair value of the securities transferred. The agreements contain contractual provisions that require additional collateral to be transferred when necessary and provide the counterparty the right to sell or re-pledge the securities transferred. The cash received from the repurchase program is typically invested in short-term investments or fixed maturities. Repurchase agreements include master netting provisions that provide the counterparties the right to offset claims and apply securities held by them with respect to their obligations in the event of a default. Although the Company has the contractual right to offset claims, fixed maturities do not meet the specific conditions for net presentation under U.S. GAAP. The Company accounts for the repurchase agreements as collateralized borrowings. The securities transferred under repurchase agreements are included in fixed maturities, AFS with the obligation to repurchase those securities recorded in other liabilities on the Company's Condensed Consolidated Balance Sheets.

As of June 30, 2016, the Company reported in fixed maturities, AFS and cash on the Condensed Consolidated Balance Sheets financial collateral pledged relating to repurchase agreements of $233. The Company reported a corresponding obligation to repurchase the pledged securities of $231 in other liabilities on the Condensed Consolidated Balance Sheets. As of December 31, 2015, the Company reported in fixed maturities, AFS and cash on the Condensed Consolidated Balance Sheets financial collateral pledged relating to repurchase agreements of $249. The Company reported a corresponding obligation to repurchase the pledged securities of $249 in other liabilities on the Condensed Consolidated Balance Sheets. The Company had no outstanding dollar roll transactions as of June 30, 2016 or December 31, 2015.

The Company is required by law to deposit securities with government agencies in certain states in which it conducts business. As of June 30, 2016, and December 31, 2015, the fair value of securities on deposit was approximately $23 and $14, respectively.

Refer to Derivative Collateral Arrangements section of this note for disclosure of collateral in support of derivative transactions.

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Derivative Instruments

The Company utilizes a variety of OTC, OTC-cleared and exchange traded derivative instruments as a part of its overall risk management strategy as well as to enter into replication transactions. Derivative instruments are used to manage risk associated with interest rate, equity market, commodity market, credit spread, issuer default, price, and currency exchange rate risk or volatility. Replication transactions are used as an economical means to synthetically replicate the characteristics and performance of assets that are permissible investments under the Company’s investment policies. The Company also may enter into and has previously issued financial instruments and products that either are accounted for as free-standing derivatives, such as certain reinsurance contracts, or may contain features that are deemed to be embedded derivative instruments, such as the GMWB rider included with certain variable annuity products.

Strategies That Qualify for Hedge Accounting

Certain derivatives that the Company enters into satisfy the hedge accounting requirements as outlined in Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements, included in the Company’s 2015 Form 10-K Annual Report. Typically, these hedge relationships include interest rate swaps and, to a lesser extent, foreign currency swaps where the terms or expected cash flows of the hedged item closely match the terms of the swap. The interest rate swaps are typically used to manage interest rate duration of certain fixed maturity securities or liability contracts. The hedge strategies by hedge accounting designation include:

Cash Flow Hedges

Interest rate swaps are predominantly used to manage portfolio duration and better match cash receipts from assets with cash disbursements required to fund liabilities. These derivatives primarily convert interest receipts on floating-rate fixed maturity securities to fixed rates.

Foreign currency swaps are used to convert foreign currency-denominated cash flows related to certain investment receipts and liability payments to U.S. dollars in order to reduce cash flow fluctuations due to changes in currency rates.

Fair Value Hedges

Interest rate swaps are used to hedge the changes in fair value of fixed maturity securities due to fluctuations in interest rates. These swaps are typically used to manage interest rate duration.

Non-Qualifying Strategies

Derivative relationships that do not qualify for hedge accounting (“non-qualifying strategies”) primarily include the hedge program for the Company's variable annuity products as well as the hedging and replication strategies that utilize credit default swaps. In addition, hedges of interest rate, foreign currency and equity risk of certain fixed maturities, equities and liabilities do not qualify for hedge accounting.

The non-qualifying strategies include:

Interest Rate Swaps, Swaptions, and Futures

The Company uses interest rate swaps, swaptions, and futures to manage duration between assets and liabilities in certain investment portfolios. In addition, the Company enters into interest rate swaps to terminate existing swaps, thereby offsetting the changes in value of the original swap. As of June 30, 2016, and December 31, 2015, the notional amount of interest rate swaps in offsetting relationships was $4.2 billion and $4.6 billion, respectively.

Foreign Currency Swaps and Forwards

The Company enters into foreign currency swaps and forwards to convert the foreign currency exposures of certain foreign currency-denominated fixed maturity investments to U.S. dollars. During 2015, the Company also entered into foreign currency forwards to hedge non-U.S. dollar denominated cash and equity securities, which matured in January 2016.

Fixed Payout Annuity Hedge

The Company reinsures certain yen denominated fixed payout annuities. The Company invests in U.S. dollar denominated assets to support the reinsurance liability. The Company entered into pay U.S. dollar, receive yen swap contracts to hedge the currency and yen interest rate exposure between the U.S. dollar denominated assets and the yen denominated fixed liability reinsurance payments.

Credit Contracts

Credit default swaps are used to purchase credit protection on an individual entity or referenced index to economically hedge against default risk and credit-related changes in value of fixed maturity securities. Credit default swaps are also used to assume credit risk related to an individual entity or referenced index as a part of replication transactions. These contracts require the Company to pay or receive a periodic fee in exchange for compensation from the counterparty should the referenced security issuers experience a credit event, as defined in the contract. The Company is also exposed to credit risk related to certain structured fixed maturity securities that have embedded credit derivatives, which reference a standard index of corporate securities. In addition, the Company enters into credit default swaps to terminate existing credit default swaps, thereby offsetting the changes in value of the original swap going forward.

Equity Index Swaps and Options

The Company enters into equity index options to hedge the impact of a decline in the equity markets on the investment portfolio. During 2015, the Company entered into a total return swap to hedge equity risk of specific common stock investments which were accounted for using the fair value option in order to align the accounting treatment within net realized capital gains (losses). The swap matured in January 2016 and the specific common stock investments were sold at that time. In addition, the Company formerly offered certain equity indexed products that remain in force, a portion of which contain embedded derivatives that require bifurcation. The Company uses equity index swaps to economically hedge the equity volatility risk associated with the equity indexed products.

Commodity Contracts

During 2015, the Company purchased for $11 put option contracts on West Texas Intermediate oil futures with a strike of $35 dollars per barrel in order to partially offset potential losses related to certain fixed maturity securities that could arise if oil prices decline substantially. The Company has since reduced its exposure to the targeted fixed maturity securities and, therefore, these options were terminated at the end of 2015.

GMWB Derivatives, Net

The Company formerly offered certain variable annuity products with GMWB riders. The GMWB product is a bifurcated embedded derivative (“GMWB product derivatives”) that has a notional value equal to the GRB. The Company uses reinsurance contracts to transfer a portion of its risk of loss due to GMWB. The reinsurance contracts covering GMWB (“GMWB reinsurance contracts”) are accounted for as free-standing derivatives with a notional amount equal to the GRB amount.

The Company utilizes derivatives (“GMWB hedging instruments”) as part of an actively managed program designed to hedge a portion of the capital market risk exposures of the non-reinsured GMWB riders due to changes in interest rates, equity market levels, and equity volatility. These derivatives include customized swaps, interest rate swaps and futures, and equity swaps, options and futures, on certain indices including the S&P 500 index, EAFE index and NASDAQ index. The following table presents notional and fair value for GMWB hedging instruments.

	Notional Amount				Fair Value
	June 30, 2016		December 31, 2015		June 30, 2016		December 31, 2015
Customized swaps	$	5,421	$	5,877	$	166	$	131
Equity swaps, options, and futures	1,395		1,362		—		2
Interest rate swaps and futures	3,716		3,740		37		25
Total	$	10,532	$	10,979	$	203	$	158

Macro Hedge Program

The Company utilizes equity swaps, options, futures, and forwards to provide partial protection against the statutory tail scenario risk arising from GMWB and guaranteed minimum death benefit ("GMDB") liabilities on the Company's statutory surplus. These derivatives cover some of the residual risks not otherwise covered by the dynamic hedging program. The following table presents notional and fair value for the macro hedge program.

	Notional Amount				Fair Value
	June 30, 2016		December 31, 2015		June 30, 2016		December 31, 2015
Equity swaps, options, futures, and forwards	$	4,699	$	4,548	$	147	$	147
Total	$	4,699	$	4,548	$	147	$	147

Modified Coinsurance Reinsurance Contracts

As of June 30, 2016, and December 31, 2015, the Company had approximately $928 and $895, respectively, of invested assets supporting other policyholder funds and benefits payable reinsured under a modified coinsurance arrangement in connection with the sale of the Individual Life business, which was structured as a reinsurance transaction. The assets are primarily held in a trust established by the Company. The Company pays or receives cash quarterly to settle the results of the reinsured business, including the investment results. As a result of this modified coinsurance arrangement, the Company has an embedded derivative that transfers to the reinsurer certain unrealized changes in fair value due to interest rate and credit risks of these assets. The notional amount of the embedded derivative reinsurance contracts are the invested assets that are carried at fair value supporting the reinsured reserves.

Derivative Balance Sheet Classification

The following table summarizes the balance sheet classification of the Company’s derivative related net fair value amounts as well as the gross asset and liability fair value amounts. For reporting purposes, the Company has elected to offset within total assets or total liabilities based upon the net of the fair value amounts, income accruals, and related cash collateral receivables and payables of OTC derivative instruments executed in a legal entity and with the same counterparty under a master netting agreement, which provides the Company with the legal right of offset. The Company has also elected to offset within total assets or total liabilities based upon the net of the fair value amounts, income accruals and related cash collateral receivables and payables of OTC-cleared derivative instruments based on clearing house agreements. The following fair value amounts do not include income accruals or related cash collateral receivables and payables, which are netted with derivative fair value amounts to determine balance sheet presentation. Derivatives in the Company’s separate accounts, where the associated gains and losses accrue directly to policyholders, are not included in the table below. The Company’s derivative instruments are held for risk management purposes, unless otherwise noted in the following table. The notional amount of derivative contracts represents the basis upon which pay or receive amounts are calculated and is presented in the table to quantify the volume of the Company’s derivative activity. Notional amounts are not necessarily reflective of credit risk. The following tables exclude investments that contain an embedded credit derivative for which the Company has elected the fair value option. For further discussion, see the Fair Value Option section in Note 2 - Fair Value Measurements of Notes to Condensed Consolidated Financial Statements.

	Net Derivatives										Asset Derivatives				Liability Derivatives
	Notional Amount				Fair Value						Fair Value				Fair Value
Hedge Designation/ Derivative Type	Jun 30, 2016		Dec 31, 2015		Jun 30, 2016			Dec 31, 2015			Jun 30, 2016		Dec 31, 2015		Jun 30, 2016			Dec 31, 2015
Cash flow hedges
Interest rate swaps	$	1,766	$	1,766	$	83		$	38		$	83	$	38	$	—		$	—
Foreign currency swaps	143		143		(19		)	(19		)	9		7		(28		)	(26		)
Total cash flow hedges	1,909		1,909		64			19			92		45		(28		)	(26		)
Fair value hedges
Interest rate swaps	23		23		—			—			—		—		—			—
Total fair value hedges	23		23		—			—			—		—		—			—
Non-qualifying strategies
Interest rate contracts
Interest rate swaps, swaptions, and futures	4,267		4,710		(407		)	(415		)	566		285		(973		)	(700		)
Foreign exchange contracts
Foreign currency swaps and forwards	2		386		—			4			—		4		—			—
Fixed payout annuity hedge	1,063		1,063		(261		)	(357		)	—		—		(261		)	(357		)
Credit contracts
Credit derivatives that purchase credit protection	110		249		(4		)	10			—		12		(4		)	(2		)
Credit derivatives that assume credit risk [1]	714		1,435		(3		)	(10		)	5		5		(8		)	(15		)
Credit derivatives in offsetting positions	1,345		1,435		(1		)	(1		)	20		17		(21		)	(18		)
Equity contracts
Equity index swaps and options	748		404		—			15			28		41		(28		)	(26		)
Variable annuity hedge program
GMWB product derivatives [2]	14,072		15,099		(412		)	(262		)	—		—		(412		)	(262		)
GMWB reinsurance contracts	2,905		3,106		106			83			106		83		—			—
GMWB hedging instruments	10,532		10,979		203			158			360		264		(157		)	(106		)
Macro hedge program	4,699		4,548		147			147			185		179		(38		)	(32		)
Other
Modified coinsurance reinsurance contracts	928		895		32			79			32		79		—			—
Total non-qualifying strategies	41,385		44,309		(600		)	(549		)	1,302		969		(1,902		)	(1,518		)
Total cash flow hedges, fair value hedges, and non-qualifying strategies	$	43,317	$	46,241	$	(536	)	$	(530	)	$	1,394	$	1,014	$	(1,930	)	$	(1,544	)
Balance Sheet Location
Fixed maturities, available-for-sale	$	150	$	184	$	1		$	(1	)	$	1	$	—	$	—		$	(1	)
Other investments	5,241		11,837		270			250			281		360		(11		)	(110		)
Other liabilities	19,972		15,071		(505		)	(653		)	974		492		(1,479		)	(1,145		)
Reinsurance recoverable	3,832		4,000		138			162			138		162		—			—
Other policyholder funds and benefits payable	14,122		15,149		(440		)	(288		)	—		—		(440		)	(288		)
Total derivatives	$	43,317	$	46,241	$	(536	)	$	(530	)	$	1,394	$	1,014	$	(1,930	)	$	(1,544	)

[1] The derivative instruments related to this strategy are held for other investment purposes.

[2] These derivatives are embedded within liabilities and are not held for risk management purposes.

Change in Notional Amount

The net decrease in notional amount of derivatives since December 31, 2015, was primarily due to the following:

• The decline in the combined notional amount associated with the GMWB hedging program, which includes the GMWB product, reinsurance, and hedging derivatives, was primarily driven by policyholder lapses and partial withdrawals.

• The decline in notional amount related to the termination of credit derivatives that assume credit risk as a result of re-balancing within certain fixed maturity sectors. The terminated positions related to replication transactions that pair credit derivatives with high quality liquid securities to earn a higher credit spread.

• The decline in notional amount related to non-qualifying interest rate derivatives was primarily driven by the termination of interest rate swaps that were used for the purpose of managing duration.

• The increase in notional amount related to equity derivatives primarily resulted from purchases of equity index options which are hedging against the potential for a decline in the equity market on the investment portfolio.

Change in Fair Value

The net decline in the total fair value of derivative instruments since December 31, 2015, was primarily related to the following:

• The decrease in fair value related to the combined GMWB hedging program, which includes the GMWB product, reinsurance, and hedging derivatives, was primarily driven by an increase in the equity markets.

• The decrease in the fair value associated with modified coinsurance reinsurance contracts, which are accounted for as embedded derivatives and transfer to the reinsurer the investment experience related to the assets supporting the reinsured policies, was primarily driven by a decline in interest rates and credit spread tightening.

• The increase in fair value associated with the fixed payout annuity hedges was primarily driven by an appreciation of the Japanese yen in comparison to the U.S. dollar, slightly offset by a decline in U.S. interest rates.

Offsetting of Derivative Assets/Liabilities

The following tables present the gross fair value amounts, the amounts offset, and net position of derivative instruments eligible for offset in the Company's Condensed Consolidated Balance Sheets. Amounts offset include fair value amounts, income accruals and related cash collateral receivables and payables associated with derivative instruments that are traded under a common master netting agreement, as described in the preceding discussion. Also included in the tables are financial collateral receivables and payables, which are contractually permitted to be offset upon an event of default, although are disallowed for offsetting under U.S. GAAP.

As of June 30, 2016

	(i)		(ii)		(iii) = (i) - (ii)					(iv)			(v) = (iii) - (iv)
					Net Amounts Presented in the Statement of Financial Position						Collateral Disallowed for Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Statement of Financial Position		Derivative Assets [1]		Accrued Interest and Cash Collateral Received [2]				Financial Collateral Received [4]		Net Amount
Description
Other investments	$	1,255	$	1,015	$	270	$	(30	)		$	189	$	51

	Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Statement of Financial Position			Derivative Liabilities [3]			Accrued Interest and Cash Collateral Pledged [3]			Financial Collateral Pledged [4]			Net Amount
Description
Other liabilities	$	(1,490	)	$	(696	)	$	(505	)	$	(289	)	$	(777	)	$	(17	)

As of December 31, 2015

	(i)		(ii)		(iii) = (i) - (ii)					(iv)			(v) = (iii) - (iv)
					Net Amounts Presented in the Statement of Financial Position						Gross Amounts Not Offset in the Statement of Financial Position
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Statement of Financial Position		Derivative Assets [1]		Accrued Interest and Cash Collateral Received [2]				Financial Collateral Received [4]		Net Amount
Description
Other investments	$	852	$	692	$	250	$	(90	)		$	99	$	61

	Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Statement of Financial Position			Derivative Liabilities [3]			Accrued Interest and Cash Collateral Pledged [3]			Financial Collateral Pledged [4]			Net Amount
Description
Other liabilities	$	(1,255	)	$	(499	)	$	(653	)	$	(103	)	$	(753	)	$	(3	)

[1] Included in other invested assets in the Company's Condensed Consolidated Balance Sheets.

[2] Included in other assets in the Company's Condensed Consolidated Balance Sheets and amount presented is limited to the net derivative receivable associated with each counterparty.

[3] Included in other liabilities in the Company's Condensed Consolidated Balance Sheets and amount presented is limited to the net derivative payable associated with each counterparty.

[4] Excludes collateral associated with exchange-traded derivative instruments.

Cash Flow Hedges

For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of OCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing hedge ineffectiveness are recognized in current period earnings. All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness.

The following tables present the components of the gain or loss on derivatives that qualify as cash flow hedges:

Derivatives in Cash Flow Hedging Relationships

	Gain (Loss) Recognized in OCI on Derivative (Effective Portion)										Net Realized Capital Gains (Losses) Recognized in Income on Derivative (Ineffective Portion)
	Three Months Ended June 30,					Six Months Ended June 30,					Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015			2016		2015			2016		2015		2016		2015
Interest rate swaps	$	11	$	(22	)	$	45	$	(2	)	$	—	$	—	$	—	$	—
Foreign currency swaps	—		6			1		(1		)	—		—		—		—
Total	$	11	$	(16	)	$	46	$	(3	)	$	—	$	—	$	—	$	—

		Gain or (Loss) Reclassified from AOCI into Income (Effective Portion)
		Three Months Ended June 30,					Six Months Ended June 30,
	Location	2016			2015		2016		2015
Interest rate swaps	Net realized capital gains (losses)	$	—		$	—	$	—	$	(1	)
Interest rate swaps	Net investment income	7			9		12		17
Foreign currency swaps	Net realized capital gains (losses)	(2		)	3		2		(7		)
Total		$	5		$	12	$	14	$	9

As of June 30, 2016, the before-tax deferred net gains on derivative instruments recorded in AOCI that are expected to be reclassified to earnings during the next twelve months are $21. This expectation is based on the anticipated interest payments on hedged investments in fixed maturity securities that will occur over the next twelve months, at which time the Company will recognize the deferred net gains (losses) as an adjustment to net investment income over the term of the investment cash flows.

During the three and six months endedJune 30, 2016, and June 30, 2015, the Company had no net reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges due to forecasted transactions that were no longer probable of occurring.

Fair Value Hedges

For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in current period earnings. The Company includes the gain or loss on the derivative in the same line item as the offsetting loss or gain on the hedged item. All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness.

For the six months endedJune 30, 2016 and 2015, the Company recognized in income losses of less than $1, respectively, representing the ineffective portion of fair value hedges for the derivative instrument and the hedged item.

Non-Qualifying Strategies

For non-qualifying strategies, including embedded derivatives that are required to be bifurcated from their host contracts and accounted for as derivatives, the gain or loss on the derivative is recognized currently in earnings within net realized capital gains (losses). The following table presents the gain or loss recognized in income on non-qualifying strategies.

Derivatives Used in Non-Qualifying Strategies

Gain or (Loss) Recognized within Net Realized Capital Gains and Losses

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Interest rate contracts
Interest rate swaps, swaptions, and futures	$	2		$	(2	)	$	(8	)	$	(3	)
Foreign exchange contracts
Foreign currency swaps and forwards	2			—			—			2
Fixed payout annuity hedge [1]	60			(17		)	96			(31		)
Credit contracts
Credit derivatives that purchase credit protection	(1		)	—			(3		)	(1		)
Credit derivatives that assume credit risk	3			(4		)	1			2
Equity contracts
Equity index swaps and options	(2		)	4			28			2
Commodity contracts
Commodity options	—			(4		)	—			(7		)
Variable annuity hedge program
GMWB product derivatives	(30		)	78			(109		)	59
GMWB reinsurance contracts	1			(16		)	13			(9		)
GMWB hedging instruments	32			(66		)	82			(53		)
Macro hedge program	(20		)	(23		)	(34		)	(27		)
Other
Modified coinsurance reinsurance contracts	(25		)	37			(47		)	26
Total [2]	$	22		$	(13	)	$	19		$	(40	)

[1] Not included in this amount is the associated liability adjustment for changes in foreign exchange spot rates through realized capital gains (losses) of $(64) and $16 for the three months ended June 30, 2016 and 2015, respectively, and $(108) and $16 for the six months ended June 30, 2016 and 2015, respectively.

[2] Excludes investments that contain an embedded credit derivative for which the Company has elected the fair value option. For further discussion, see the Fair Value Option section in Note 2 - Fair Value Measurements.

For the three and six months endedJune 30, 2016, the net realized capital gain (loss) related to derivatives used in non-qualifying strategies was primarily comprised of the following:

• The net gains on the fixed payout annuity hedge primarily resulted from an appreciation of the Japanese yen in comparison to the U.S. dollar, slightly offset by a decline in U.S. interest rates.

• For the six months ended, the net loss related to the combined GMWB hedging program which includes the GMWB product, reinsurance, and hedging derivatives, was primarily driven by an increase in the U.S. equity markets.

• The net losses on the macro hedge program were primarily driven by an increase in equity markets and time decay of options, partially offset by gains due to a decline in interest rates and an increase in equity volatility.

• The losses associated with modified coinsurance reinsurance contracts, which are accounted for as embedded derivatives and transfer to the reinsurer the investment experience related to the assets supporting the reinsured policies, were primarily driven by a decline in interest rates and credit spread tightening. The assets remain on the Company's books and the Company recorded an offsetting gain in OCI as a result of the increase in market value of the bonds.

In addition, for the three and six months ended June 30, 2016 and 2015, the Company recognized gains of $1 and $1, respectively, due to cash recovered on derivative receivables that were previously written off related to the bankruptcy of Lehman Brothers Inc. The derivative receivables were the result of the contractual collateral threshold amounts and open collateral calls prior to the bankruptcy filing as well as interest rate and credit spread movements from the date of the last collateral call to the date of the bankruptcy filing.

For the three and six months endedJune 30, 2015, the net realized capital gain (loss) related to derivatives used in non-qualifying strategies was primarily comprised of the following:

• The losses on the macro hedge program were primarily driven by time decay on options and an increase in interest rates.

• The net losses related to the fixed payout annuity hedge were primarily driven by the depreciation of the Japanese yen in comparison to the U.S. dollar, partially offset by an increase in U.S. interest rates. In addition, for the six months ended June 30, 2015, losses were driven by a decline in short-term U.S. interest rates.

• The gains on the GMWB product derivatives was largely driven by an increase in interest rates, offset by losses on the GMWB reinsurance contracts and GMWB hedging instruments.

• The gains associated with modified coinsurance reinsurance contracts, which are accounted for as embedded derivatives and transfer to the reinsurer the investment experience related to the assets supporting the reinsured policies, were primarily driven by an increase in long-term interest rates during the period.

For additional disclosures regarding contingent credit related features in derivative agreements, see Note 6 - Commitments and Contingencies of Notes to Condensed Consolidated Financial Statements.

Credit Risk Assumed through Credit Derivatives

The Company enters into credit default swaps that assume credit risk of a single entity or referenced index in order to synthetically replicate investment transactions that would be permissible under the Company's investment policies. The Company will receive periodic payments based on an agreed upon rate and notional amount and will only make a payment if there is a credit event. A credit event payment will typically be equal to the notional value of the swap contract less the value of the referenced security issuer’s debt obligation after the occurrence of the credit event. A credit event is generally defined as a default on contractually obligated interest or principal payments or bankruptcy of the referenced entity. The credit default swaps in which the Company assumes credit risk primarily reference investment grade single corporate issuers and baskets, which include standard diversified portfolios of corporate and CMBS issuers. The diversified portfolios of corporate issuers are established within sector concentration limits and may be divided into tranches that possess different credit ratings.

The following tables present the notional amount, fair value, weighted average years to maturity, underlying referenced credit obligation type and average credit ratings, and offsetting notional amounts and fair value for credit derivatives in which the Company is assuming credit risk as of June 30, 2016, and December 31, 2015.

As of June 30, 2016

							Underlying Referenced Credit Obligation(s) [1]
Credit Derivative type by derivative risk exposure	Notional Amount [2]		Fair Value			Weighted Average Years to Maturity	Type	Average Credit Rating	Offsetting Notional Amount [3]		Offsetting Fair Value [3]
Single name credit default swaps
Investment grade risk exposure	$	101	$	—		3 years	Corporate Credit/ Foreign Gov.	A-	$	62	$	—
Below investment grade risk exposure	43		(1		)	2 years	Corporate Credit	CCC+	43		—
Basket credit default swaps [4]
Investment grade risk exposure	673		5			3 years	Corporate Credit	BBB+	345		(2		)
Below investment grade risk exposure	22		1			5 years	Corporate Credit	BB-	22		(1		)
Investment grade risk exposure	331		(8		)	5 years	CMBS Credit	AA+	134		1
Below investment grade risk exposure	67		(16		)	1 year	CMBS Credit	CCC	67		16
Embedded credit derivatives
Investment grade risk exposure	150		150			1 year	Corporate Credit	A+	—		—
Total [5]	$	1,387	$	131					$	673	$	14

As of December 31, 2015

							Underlying Referenced Credit Obligation(s) [1]
Credit Derivative type by derivative risk exposure	Notional Amount [2]		Fair Value			Weighted Average Years to Maturity	Type	Average Credit Rating	Offsetting Notional Amount [3]		Offsetting Fair Value [3]
Single name credit default swaps
Investment grade risk exposure	$	118	$	—		1 year	Corporate Credit/ Foreign Gov.	BBB+	$	115	$	(1	)
Below investment grade risk exposure	43		(2		)	2 years	Corporate Credit	CCC+	43		1
Basket credit default swaps [4]
Investment grade risk exposure	1,265		7			4 years	Corporate Credit	BBB+	345		(2		)
Investment grade risk exposure	503		(14		)	6 years	CMBS Credit	AAA-	141		1
Below investment grade risk exposure	74		(13		)	1 year	CMBS Credit	CCC	74		13
Embedded credit derivatives
Investment grade risk exposure	150		148			1 year	Corporate Credit	A+	—		—
Total [5]	$	2,153	$	126					$	718	$	12

[1] The average credit ratings are based on availability and the midpoint of the applicable ratings among Moody’s, S&P, Fitch, and Morningstar. If no rating is available from a rating agency, then an internally developed rating is used.

[2] Notional amount is equal to the maximum potential future loss amount. These derivatives are governed by agreements, clearing house rules, and applicable law, which include collateral posting requirements. There is no additional specific collateral related to these contracts or recourse provisions included in the contracts to offset losses.

[3] The Company has entered into offsetting credit default swaps to terminate certain existing credit default swaps, thereby offsetting the future changes in value of, or losses paid related to, the original swap.

[4] Includes $1.1 billion and $1.8 billion as of June 30, 2016, and December 31, 2015, respectively, of standard market indices of diversified portfolios of corporate and CMBS issuers referenced through credit default swaps. These swaps are subsequently valued based upon the observable standard market index.

[5] Excludes investments that contain an embedded credit derivative for which the Company has elected the fair value option. For further discussion, see the Fair Value Option section in Note 2 - Fair Value Measurements.

Derivative Collateral Arrangements

The Company enters into various collateral arrangements in connection with its derivative instruments, which require both the pledging and accepting of collateral. As of June 30, 2016, and December 31, 2015, the Company pledged cash collateral associated with derivative instruments with a fair value of $39 and $173, respectively, for which the collateral receivable has been primarily included within other assets on the Company's Condensed Consolidated Balance Sheets. The Company also pledged securities collateral associated with derivative instruments with a fair value of $917 and $873, respectively, as of June 30, 2016 and December 31, 2015, which have been included in fixed maturities on the Condensed Consolidated Balance Sheets. The counterparties have the right to sell or re-pledge these securities.

As of June 30, 2016, and December 31, 2015 the Company accepted cash collateral associated with derivative instruments of $372 and $341, respectively, which was invested and recorded in the Company's Condensed Consolidated Balance Sheets in fixed maturities and short-term investments with corresponding amounts recorded in other liabilities. The Company also accepted securities collateral as of June 30, 2016, and December 31, 2015, with a fair value of $203 and $100, respectively, of which the Company has the ability to sell or repledge $203 and $100, respectively. As of June 30, 2016, and December 31, 2015, the Company had no repledged securities and did not sell any securities. In addition, as of June 30, 2016, and December 31, 2015, non-cash collateral accepted was held in separate custodial accounts and was not included in the Company’s Condensed Consolidated Balance Sheets.