INVESTMENTS (Tables)

12 Months Ended

Dec. 31, 2015

INVESTMENTS

The amortized cost or cost and fair value of AIG's available for sale securities and other invested assets carried at fair value

										Other-Than-
		Amortized		Gross		Gross				Temporary
		Cost or		Unrealized		Unrealized		Fair		Impairments
(in millions)		Cost		Gains		Losses		Value		in AOCI(a)
December 31, 2015
Bonds available for sale:
U.S. government and government sponsored entities	$	1,698	$	155	$	(9)	$	1,844	$	-
Obligations of states, municipalities and political subdivisions		26,003		1,424		(104)		27,323		19
Non-U.S. governments		17,752		805		(362)		18,195		-
Corporate debt		133,513		6,462		(3,987)		135,988		(87)
Mortgage-backed, asset-backed and collateralized:
RMBS		33,878		2,760		(411)		36,227		1,326
CMBS		13,139		561		(129)		13,571		185
CDO/ABS		14,985		360		(248)		15,097		39
Total mortgage-backed, asset-backed and collateralized		62,002		3,681		(788)		64,895		1,550
Total bonds available for sale(b)		240,968		12,527		(5,250)		248,245		1,482
Equity securities available for sale:
Common stock		913		1,504		(16)		2,401		-
Preferred stock		19		3		-		22		-
Mutual funds		447		53		(8)		492		-
Total equity securities available for sale		1,379		1,560		(24)		2,915		-
Total	$	242,347	$	14,087	$	(5,274)	$	251,160	$	1,482
December 31, 2014
Bonds available for sale:
U.S. government and government sponsored entities	$	2,806	$	204	$	(18)	$	2,992	$	-
Obligations of states, municipalities and political subdivisions		25,979		1,729		(49)		27,659		(13)
Non-U.S. governments		20,280		966		(151)		21,095		-
Corporate debt		134,961		10,594		(1,122)		144,433		64
Mortgage-backed, asset-backed and collateralized:
RMBS		34,377		3,435		(292)		37,520		1,767
CMBS		12,129		815		(59)		12,885		215
CDO/ABS		12,775		628		(128)		13,275		47
Total mortgage-backed, asset-backed and collateralized		59,281		4,878		(479)		63,680		2,029
Total bonds available for sale(b)		243,307		18,371		(1,819)		259,859		2,080
Equity securities available for sale:
Common stock		1,185		2,461		(17)		3,629		-
Preferred stock		21		4		-		25		-
Mutual funds		724		54		(37)		741		-
Total equity securities available for sale		1,930		2,519		(54)		4,395		-
Total	$	245,237	$	20,890	$	(1,873)	$	264,254	$	2,080

(a) Represents the amount of other-than-temporary impairments recognized in Accumulated other comprehensive income. Amount includes unrealized gains and losses on impaired securities relating to changes in the fair value of such securities subsequent to the impairment measurement date.

(b)At December 31,2015 and 2014, bonds available for sale held by us that were below investment grade or not rated totaled $34.9billion and $35.1billion, respectively.

The fair value and gross unrealized losses on AIG's available for sale securities, aggregated by major investment category and length of time that individual securities have been in a continuous unrealized loss position

	Less than 12 Months				12 Months or More				Total
				Gross				Gross				Gross
		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(in millions)		Value		Losses		Value		Losses		Value		Losses
December 31, 2015
Bonds available for sale:
U.S. government and government sponsored entities	$	483	$	9	$	1	$	-	$	484	$	9
Obligations of states, municipalities and political
subdivisions		2,382		87		268		17		2,650		104
Non-U.S. governments		4,327		203		832		159		5,159		362
Corporate debt		41,317		2,514		5,428		1,473		46,745		3,987
RMBS		7,215		133		4,318		278		11,533		411
CMBS		4,138		108		573		21		4,711		129
CDO/ABS		7,064		104		2,175		144		9,239		248
Total bonds available for sale		66,926		3,158		13,595		2,092		80,521		5,250
Equity securities available for sale:
Common stock		91		16		-		-		91		16
Mutual funds		200		8		-		-		200		8
Total equity securities available for sale		291		24		-		-		291		24
Total	$	67,217	$	3,182	$	13,595	$	2,092	$	80,812	$	5,274
December 31, 2014
Bonds available for sale:
U.S. government and government sponsored entities	$	526	$	5	$	281	$	13	$	807	$	18
Obligations of states, municipalities and political
subdivisions		495		9		794		40		1,289		49
Non-U.S. governments		1,606		42		1,690		109		3,296		151
Corporate debt		12,132		450		11,570		672		23,702		1,122
RMBS		4,621		109		3,996		183		8,617		292
CMBS		220		1		2,087		58		2,307		59
CDO/ABS		3,857		50		1,860		78		5,717		128
Total bonds available for sale		23,457		666		22,278		1,153		45,735		1,819
Equity securities available for sale:
Common stock		88		16		2		1		90		17
Mutual funds		280		37		64		-		344		37
Total equity securities available for sale		368		53		66		1		434		54
Total	$	23,825	$	719	$	22,344	$	1,154	$	46,169	$	1,873

The amortized cost and fair value of fixed maturity securities available for sale by contractual maturity

	Total Fixed Maturity Securities				Fixed Maturity Securities Available
December 31, 2015	Available for Sale				for Sale in a Loss Position
(in millions)		Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	9,176	$	9,277	$	1,122	$	1,103
Due after one year through five years		47,230		49,196		9,847		9,494
Due after five years through ten years		54,120		54,459		22,296		20,686
Due after ten years		68,440		70,418		26,235		23,755
Mortgage-backed, asset-backed and collateralized		62,002		64,895		26,271		25,483
Total	$	240,968	$	248,245	$	85,771	$	80,521
December 31, 2014
Due in one year or less	$	9,821	$	9,975	$	637	$	620
Due after one year through five years		48,352		50,873		6,669		6,529
Due after five years through ten years		62,685		65,889		12,873		12,338
Due after ten years		63,168		69,442		10,255		9,607
Mortgage-backed, asset-backed and collateralized		59,281		63,680		17,120		16,641
Total	$	243,307	$	259,859	$	47,554	$	45,735

The gross realized gains and gross realized losses from sales of AIG's available for sale securities

	Years Ended December 31,
		2015				2014				2013
		Gross		Gross		Gross		Gross	Gross		Gross
	Realized		Realized		Realized		Realized		Realized		Realized
(in millions)		Gains		Losses		Gains		Losses	Gains		Losses
Fixed maturity securities	$	517	$	423	$	703	$	118	$	2,634	$	202
Equity securities		1,060		28		135		24		130		19
Total	$	1,577	$	451	$	838	$	142	$	2,764	$	221

The fair value of AIG's other securities

		December 31, 2015				December 31, 2014
		Fair	Percent			Fair	Percent
(in millions)		Value	of Total			Value	of Total
Fixed maturity securities:
U.S. government and government sponsored entities	$	3,369	19	%	$	5,498	27	%
Obligations of states, municipalities and political subdivisions		75	-			122	1
Non-U.S. governments		50	-			2	-
Corporate debt		2,035	12			719	3
Mortgage-backed, asset-backed and collateralized:
RMBS		2,230	13			2,094	10
CMBS		750	4			1,077	5
CDO/ABS and other collateralized*		8,273	47			10,200	49
Total mortgage-backed, asset-backed and collateralized		11,253	64			13,371	64
Total fixed maturity securities		16,782	95			19,712	95
Equity securities		921	5			1,049	5
Total	$	17,703	100	%	$	20,761	100	%

*Includes $712 million and $859 million of U.S. Government agency backed ABS at December 31, 2015 and 2014, respectively.

Components of other invested assets

December 31,
(in millions)		2015		2014
Alternative investments(a)	$	18,150	$	19,656
Investment real estate(b)		6,579		3,612
Aircraft asset investments(c)		477		651
Investments in life settlements		3,606		3,753
Investment in AerCap		-		4,972
All other investments		982		1,874
Total	$	29,794	$	34,518

(a) Includes hedge funds, private equity funds, affordable housing partnerships, and other investment partnerships.

(b) Net of accumulated depreciation of $668 million and $315 million in 2015 and 2014, respectively.

(c) Consistsof investments in aircraft equipment held in consolidated trusts.

The carrying value and ownership percentage of AIA and equity method investments

		2015			2014
		Carrying	Ownership		Carrying	Ownership
(in millions, except percentages)		Value	Percentage		Value	Percentage
Equity method investments	$	14,259	Various	$	18,951	Various

Schedule of information regarding investments in life settlements

	December 31, 2015
	Number of		Carrying	Face Value
(dollars in millions)	Contracts		Value	(Death Benefits)
Remaining Life Expectancy of Insureds:
0 – 1 year	1	$	-	$	-
1 – 2 years	9		9		17
2 – 3 years	16		10		20
3 – 4 years	72		50		113
4 – 5 years	156		235		485
Thereafter	4,300		3,302		14,233
Total	4,554	$	3,606	$	14,868

Components of net investment income

Years Ended December 31,
(in millions)		2015		2014		2013
Fixed maturity securities, including short-term investments	$	11,332	$	12,322	$	12,044
Equity securities		99		221		178
Interest on mortgage and other loans		1,417		1,272		1,144
Alternative investments*		1,476		2,624		2,803
Real estate		181		110		128
Other investments		76		47		61
Total investment income		14,581		16,596		16,358
Investment expenses		528		517		548
Net investment income	$	14,053	$	16,079	$	15,810

* Includes hedge funds, private equity funds, affordable housing partnerships, investments in life settlements and other investment partnerships.

Components of net realized capital gains (losses)

Years Ended December 31,
(in millions)		2015			2014		2013
Sales of fixed maturity securities	$	94		$	585	$	2,432
Sales of equity securities(a)		1,032			111		111
Other-than-temporary impairments:
Severity		(13)			(3)		(6)
Change in intent		(233)			(40)		(48)
Foreign currency declines		(57)			(19)		(1)
Issuer-specific credit events		(348)			(169)		(170)
Adverse projected cash flows		(20)			(16)		(7)
Provision for loan losses		(58)			(1)		(26)
Foreign exchange transactions		416			598		151
Derivative instruments		341			(177)		287
Impairments on investments in life settlements		(540)			(201)		(971)
Other		162	(b)		71		187
Net realized capital gains	$	776		$	739	$	1,939

(a) Includes realized gains on the sale of our equity interests in PICC.

(b) Includes realized gains due to the sale of Class B shares of Prudential Financial, Inc. and common shares of Springleaf Holdings, Inc. and realized losses on the sale of ordinary shares of AerCap.

Schedule of increase (decrease) in unrealized appreciation (depreciation) of available for sale securities and other investments

	Years Ended
	December 31,
(in millions)		2015		2014
Increase (decrease) in unrealized appreciation (depreciation) of investments:
Fixed maturity securities	$	(9,275)	$	6,809
Equity securities		(929)		535
Other investments		(803)		376
Total increase (decrease) in unrealized appreciation (depreciation) of investments	$	(11,007)	$	7,720

Credit impairments recognized in earnings for available for sale fixed maturity securities

Years Ended December 31,
(in millions)		2015		2014		2013
Balance, beginning of year	$	2,659	$	3,872	$	5,164
Increases due to:
Credit impairments on new securities subject to impairment losses		111		49		47
Additional credit impairments on previously impaired securities		109		85		78
Reductions due to:
Credit impaired securities fully disposed for which there was no
prior intent or requirement to sell		(399)		(613)		(643)
Credit impaired securities for which there is a current intent or
anticipated requirement to sell		2		-		-
Accretion on securities previously impaired due to credit*		(735)		(725)		(774)
Other		-		(9)		-
Balance, end of year	$	1,747	$	2,659	$	3,872

* Represents both accretion recognized due to changes in cash flows expected to be collected over the remaining expected term of the credit impaired securities and the accretion due to the passage of time.

Schedule of Purchased Credit Impaired (PCI) Securities, at acquisition date

(in millions)	At Date of Acquisition
Contractually required payments (principal and interest)	$	33,191
Cash flows expected to be collected*		26,882
Recorded investment in acquired securities		17,955

* Represents undiscounted expected cash flows, including both principal and interest.

Schedule of Purchased Credit Impaired (PCI) Securities, at reporting date

		December 31,		December 31,
(in millions)		2015		2014
Outstanding principal balance	$	16,871	$	16,962
Amortized cost		12,303		12,216
Fair value		13,164		13,462

Activity for accretable yield on Purchased Credit Impaired (PCI) Securities

Years Ended December 31,
(in millions)		2015		2014
Balance, beginning of year	$	6,865	$	6,940
Newly purchased PCI securities		696		1,289
Disposals		(13)		-
Accretion		(879)		(880)
Effect of changes in interest rate indices		(251)		(542)
Net reclassification from (to) non-accretable difference,
including effects of prepayments		428		58
Balance, end of year	$	6,846	$	6,865

Schedule of fair value of securities pledged to counterparties under secured financing transactions

(in millions)		December 31, 2015		December 31, 2014
Fixed maturity securities available for sale	$	1,145	$	-
Other bond securities, at fair value		1,740		2,122

Schedule of fair value of securities pledged to the entity under reverse repurchase agreements

(in millions)		December 31, 2015		December 31, 2014
Securities collateral pledged to us	$	1,742	$	2,506
Amount sold or repledged by us		-		131

Investment [Line Items]

Summarized financial information of AIG's equity method investees

Years Ended December 31,
(in millions)		2015		2014		2013
Operating results:
Total revenues	$	22,055	$	29,579	$	19,181
Total expenses		(3,898)		(7,828)		(5,515)
Net income	$	18,157	$	21,751	$	13,666
At December 31,
(in millions)				2015		2014
Balance sheet:
Total assets			$	201,007	$	207,994
Total liabilities			$	(33,424)	$	(67,346)