FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2017

FAIR VALUE MEASUREMENTS

Assets and liabilities measured at fair value on a recurring basis

June 30, 2017							Counterparty		Cash
(in millions)		Level 1		Level 2		Level 3		Netting(b)	Collateral			Total
Assets:
Bonds available for sale:
U.S. government and government sponsored entities	$	1	$	2,355	$	-	$	-	$	-	$	2,356
Obligations of states, municipalities and political subdivisions		-		17,437		2,285		-		-		19,722
Non-U.S. governments		406		14,721		12		-		-		15,139
Corporate debt		-		131,118		932		-		-		132,050
RMBS		-		19,673		16,393		-		-		36,066
CMBS		-		12,428		735		-		-		13,163
CDO/ABS		-		8,188		8,605		-		-		16,793
Total bonds available for sale		407		205,920		28,962		-		-		235,289
Other bond securities:
U.S. government and government sponsored entities		359		2,821		-		-		-		3,180
Non-U.S. governments		-		54		-		-		-		54
Corporate debt		-		1,820		28		-		-		1,848
RMBS		-		457		1,510		-		-		1,967
CMBS		-		410		66		-		-		476
CDO/ABS		-		719		5,234		-		-		5,953
Total other bond securities		359		6,281		6,838		-		-		13,478
Equity securities available for sale:
Common stock		977		-		7		-		-		984
Preferred stock		19		529		-		-		-		548
Mutual funds		70		3		-		-		-		73
Total equity securities available for sale		1,066		532		7		-		-		1,605
Other equity securities		506		-		-		-		-		506
Mortgage and other loans receivable		-		-		5		-		-		5
Other invested assets(a)		-		2		225		-		-		227
Derivative assets:
Interest rate contracts		4		2,355		-		-		-		2,359
Foreign exchange contracts		-		974		-		-		-		974
Equity contracts		269		197		63		-		-		529
Credit contracts		-		-		2		-		-		2
Other contracts		-		-		22		-		-		22
Counterparty netting and cash collateral		-		-		-		(1,265)		(1,625)		(2,890)
Total derivative assets		273		3,526		87		(1,265)		(1,625)		996
Short-term investments		2,596		809		-		-		-		3,405
Separate account assets		82,031		5,059		-		-		-		87,090
Total	$	87,238	$	222,129	$	36,124	$	(1,265)	$	(1,625)	$	342,601
Liabilities:
Policyholder contract deposits	$	-	$	13	$	3,518	$	-	$	-	$	3,531
Other policyholder funds		-		-		-		-		-		-
Derivative liabilities:
Interest rate contracts		1		1,870		30		-		-		1,901
Foreign exchange contracts		-		1,201		7		-		-		1,208
Equity contracts		41		2		-		-		-		43
Credit contracts		-		-		295		-		-		295
Other contracts		-		-		6		-		-		6
Counterparty netting and cash collateral		-		-		-		(1,265)		(1,074)		(2,339)
Total derivative liabilities		42		3,073		338		(1,265)		(1,074)		1,114
Long-term debt		-		3,024		61		-		-		3,085
Other liabilities		380		360		-		-		-		740
Total	$	422	$	6,470	$	3,917	$	(1,265)	$	(1,074)	$	8,470

December 31, 2016							Counterparty		Cash
(in millions)		Level 1		Level 2		Level 3		Netting(b)	Collateral			Total
Assets:
Bonds available for sale:
U.S. government and government sponsored entities	$	63	$	1,929	$	-	$	-	$	-	$	1,992
Obligations of states, municipalities and political subdivisions		-		22,732		2,040		-		-		24,772
Non-U.S. governments		52		14,466		17		-		-		14,535
Corporate debt		-		131,047		1,133		-		-		132,180
RMBS		-		20,468		16,906		-		-		37,374
CMBS		-		12,231		2,040		-		-		14,271
CDO/ABS		-		8,578		7,835		-		-		16,413
Total bonds available for sale		115		211,451		29,971		-		-		241,537
Other bond securities:
U.S. government and government sponsored entities		-		2,939		-		-		-		2,939
Non-U.S. governments		-		51		-		-		-		51
Corporate debt		-		1,755		17		-		-		1,772
RMBS		-		420		1,605		-		-		2,025
CMBS		-		448		155		-		-		603
CDO/ABS		-		905		5,703		-		-		6,608
Total other bond securities		-		6,518		7,480		-		-		13,998
Equity securities available for sale:
Common stock		1,056		9		-		-		-		1,065
Preferred stock		752		-		-		-		-		752
Mutual funds		260		1		-		-		-		261
Total equity securities available for sale		2,068		10		-		-		-		2,078
Other equity securities		482		-		-		-		-		482
Mortgage and other loans receivable		-		-		11		-		-		11
Other invested assets(a)		-		1		204		-		-		205
Derivative assets:
Interest rate contracts		-		2,328		-		-		-		2,328
Foreign exchange contracts		-		1,320		-		-		-		1,320
Equity contracts		188		59		58		-		-		305
Credit contracts		-		-		2		-		-		2
Other contracts		-		6		16		-		-		22
Counterparty netting and cash collateral		-		-		-		(1,265)		(903)		(2,168)
Total derivative assets		188		3,713		76		(1,265)		(903)		1,809
Short-term investments		2,660		681		-		-		-		3,341
Separate account assets		77,318		5,654		-		-		-		82,972
Total	$	82,831	$	228,028	$	37,742	$	(1,265)	$	(903)	$	346,433
Liabilities:
Policyholder contract deposits	$	-	$	25	$	3,033	$	-	$	-	$	3,058
Other policyholder funds		5		-		-		-		-		5
Derivative liabilities:
Interest rate contracts		-		3,039		38		-		-		3,077
Foreign exchange contracts		-		1,358		11		-		-		1,369
Equity contracts		12		7		-		-		-		19
Credit contracts		-		-		331		-		-		331
Other contracts		-		1		5		-		-		6
Counterparty netting and cash collateral		-		-		-		(1,265)		(1,521)		(2,786)
Total derivative liabilities		12		4,405		385		(1,265)		(1,521)		2,016
Long-term debt		-		3,357		71		-		-		3,428
Total	$	17	$	7,787	$	3,489	$	(1,265)	$	(1,521)	$	8,507

(a) Excludes investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent), which totaled $6.4 billion and $6.7 billion as of June 30,2017 and December 31,2016, respectively.

(b) Represents netting of derivative exposures covered by qualifying master netting agreements.

Changes in Level 3 recurring fair value measurements (Assets)

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	Gains (Losses)			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Three Months Ended June 30, 2017
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,041	$	(1)	$	89	$	148	$	8	$	-	$	2,285	$	-
Non-U.S. governments		16		-		1		(5)		-		-		12		-
Corporate debt		1,079		5		3		(153)		70		(72)		932		-
RMBS		16,487		264		346		(681)		-		(23)		16,393		-
CMBS		1,003		18		2		(274)		-		(14)		735		-
CDO/ABS		7,755		(28)		132		746		-		-		8,605		-
Total bonds available for sale		28,381		258		573		(219)		78		(109)		28,962		-
Other bond securities:
Corporate debt		18		-		-		10		-		-		28		-
RMBS		1,502		66		-		(58)		-		-		1,510		43
CMBS		65		2		-		(1)		-		-		66		2
CDO/ABS		5,508		175		-		(449)		-		-		5,234		55
Total other bond securities		7,093		243		-		(498)		-		-		6,838		100
Equity securities available for sale:
Common stock		8		-		-		-		-		(1)		7		-
Total equity securities available for sale		8		-		-		-		-		(1)		7		-
Other equity securities		-		-		-		-		-		-		-		-
Mortgage and other loans receivable		11		-		-		(6)		-		-		5		-
Other invested assets		180		4		2		39		-		-		225		4
Total	$	35,673	$	505	$	575	$	(684)	$	78	$	(110)	$	36,037	$	104
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	(Gains) Losses			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	3,072	$	340	$	-	$	106	$	-	$	-	$	3,518	$	7
Derivative liabilities, net:
Interest rate contracts		32		2		-		(4)		-		-		30		(1)
Foreign exchange contracts		6		1		-		-		-		-		7		(1)
Equity contracts		(62)		(4)		-		3		-		-		(63)		9
Commodity contracts		-		-		-		-		-		-		-		-
Credit contracts		315		(21)		-		(1)		-		-		293		23
Other contracts		(11)		(20)		-		18		(3)		-		(16)		46
Total derivative liabilities, net(a)		280		(42)		-		16		(3)		-		251		76
Long-term debt(b)		58		2		-		1		-		-		61		(2)
Total	$	3,410	$	300	$	-	$	123	$	(3)	$	-	$	3,830	$	81

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	Gains (Losses)			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Six Months Ended June 30, 2017
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,040	$	1	$	85	$	169	$	8	$	(18)	$	2,285	$	-
Non-U.S. governments		17		-		1		(6)		-		-		12		-
Corporate debt		1,133		1		-		(166)		206		(242)		932		-
RMBS		16,906		553		497		(1,539)		8		(32)		16,393		-
CMBS		2,040		23		7		(622)		-		(713)		735		-
CDO/ABS		7,835		(22)		180		644		-		(32)		8,605		-
Total bonds available for sale		29,971		556		770		(1,520)		222		(1,037)		28,962		-
Other bond securities:
Corporate debt		17		1		-		10		-		-		28		1
RMBS		1,605		121		-		(183)		-		(33)		1,510		67
CMBS		155		2		-		(18)		-		(73)		66		3
CDO/ABS		5,703		348		-		(817)		-		-		5,234		125
Total other bond securities		7,480		472		-		(1,008)		-		(106)		6,838		196
Equity securities available for sale:
Common stock		-		-		-		8		-		(1)		7		-
Total equity securities available for sale		-		-		-		8		-		(1)		7		-
Other equity securities		-		-		-		-		-		-		-		-
Mortgage and other loans receivable		11		-		-		(6)		-		-		5		-
Other invested assets		204		3		(3)		22		-		(1)		225		4
Total	$	37,666	$	1,031	$	767	$	(2,504)	$	222	$	(1,145)	$	36,037	$	200
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	(Gains) Losses			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	3,033	$	295	$	-	$	190	$	-	$	-	$	3,518	$	2
Derivative liabilities, net:
Interest rate contracts		38		(1)		-		(7)		-		-		30		2
Foreign exchange contracts		11		1		-		(5)		-		-		7		(1)
Equity contracts		(58)		(15)		-		10		-		-		(63)		14
Commodity contracts		-		-		-		-		-		-		-		-
Credit contracts		329		(36)		-		-		-		-		293		34
Other contracts		(11)		(39)		-		37		(3)		-		(16)		45
Total derivative liabilities, net(a)		309		(90)		-		35		(3)		-		251		94
Long-term debt(b)		71		14		-		(24)		-		-		61		(4)
Total	$	3,413	$	219	$	-	$	201	$	(3)	$	-	$	3,830	$	92

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		Gains (Losses)		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Three Months Ended June 30, 2016
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,196	$	2	$	136	$	(21)	$	-	$	-	$	2,313	$	-
Non-U.S. governments		30		-		-		2		-		(4)		28		-
Corporate debt		1,024		2		7		(65)		193		(325)		836		-
RMBS		16,162		234		61		61		261		-		16,779		-
CMBS		2,368		16		10		(87)		-		(12)		2,295		-
CDO/ABS		6,592		8		93		382		-		-		7,075		-
Total bonds available for sale		28,372		262		307		272		454		(341)		29,326		-
Other bond securities:
Corporate debt		18		1		-		(1)		-		-		18		1
RMBS		1,513		14		-		(41)		-		-		1,486		(19)
CMBS		170		-		-		(2)		-		-		168		9
CDO/ABS		6,576		109		-		(308)		-		(65)		6,312		(60)
Total other bond securities		8,277		124		-		(352)		-		(65)		7,984		(69)
Equity securities available for sale:
Common stock		-		-		-		-		-		-		-		-
Total equity securities available for sale		-		-		-		-		-		-		-		-
Other equity securities		15		(1)		-		-		-		-		14		-
Mortgage and other loans receivable		11		-		-		-		-		-		11		-
Other invested assets		263		(12)		6		(16)		-		-		241		-
Total	$	36,938	$	373	$	313	$	(96)	$	454	$	(406)	$	37,576	$	(69)
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		(Gains) Losses		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	3,251	$	598	$	-	$	141	$	-	$	-	$	3,990	$	16
Derivative liabilities, net:
Interest rate contracts		48		3		-		(5)		-		-		46		-
Foreign exchange contracts		9		1		-		(1)		-		-		9		(1)
Equity contracts		(51)		(4)		-		3		-		-		(52)		3
Credit contracts		490		(28)		-		(89)		-		-		373		18
Other contracts		121		(24)		-		5		-		-		102		23
Total derivatives liabilities, net(a)		617		(52)		-		(87)		-		-		478		43
Long-term debt(b)		184		(2)		-		(2)		-		(113)		67		-
Total	$	4,052	$	544	$	-	$	52	$	-	$	(113)	$	4,535	$	59

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		Gains (Losses)		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Six Months Ended June 30, 2016
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,124	$	2	$	194	$	(7)	$	-	$	-	$	2,313	$	-
Non-U.S. governments		32		-		(2)		2		-		(4)		28		-
Corporate debt		1,370		3		(17)		(36)		314		(798)		836		-
RMBS		16,537		479		(359)		(172)		294		-		16,779		-
CMBS		2,585		58		(78)		(168)		-		(102)		2,295		-
CDO/ABS		6,169		20		43		820		23		-		7,075		-
Total bonds available for sale		28,817		562		(219)		439		631		(904)		29,326		-
Other bond securities:
Corporate debt		17		2		-		(1)		-		-		18		3
RMBS		1,581		(23)		-		(54)		-		(18)		1,486		(61)
CMBS		193		(2)		-		(23)		-		-		168		7
CDO/ABS		7,055		(24)		-		(719)		65		(65)		6,312		(364)
Total other bond securities		8,846		(47)		-		(797)		65		(83)		7,984		(415)
Equity securities available for sale:
Common stock		-		-		-		-		-		-		-		-
Total equity securities available for sale		-		-		-		-		-		-		-		-
Other equity securities		14		-		-		-		-		-		14		1
Mortgage and other loans receivable		11		-		-		-		-		-		11		-
Other invested assets		332		(1)		1		(37)		-		(54)		241		-
Total	$	38,020	$	514	$	(218)	$	(395)	$	696	$	(1,041)	$	37,576	$	(414)
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		(Gains) Losses		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	2,289	$	1,443	$	-	$	258	$	-	$	-	$	3,990	$	37
Derivative liabilities, net:
Interest rate contracts		50		7		-		(11)		-		-		46		(5)
Foreign exchange contracts		7		2		-		-		-		-		9		(1)
Equity contracts		(54)		-		-		2		-		-		(52)		-
Credit contracts		505		(34)		-		(98)		-		-		373		28
Other contracts		48		30		-		24		-		-		102		(31)
Total derivatives liabilities, net(a)		556		5		-		(83)		-		-		478		(9)
Long-term debt(b)		183		-		-		(3)		-		(113)		67		3
Total	$	3,028	$	1,448	$	-	$	172	$	-	$	(113)	$	4,535	$	31

(a)Total Level 3 derivative exposures have been netted in these tables for presentation purposes only.

(b)Includes guaranteed investment agreements (GIAs), notes, bonds, loans and mortgages payable.

Changes in Level 3 recurring fair value measurements (Liabilities)

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	Gains (Losses)			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Three Months Ended June 30, 2017
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,041	$	(1)	$	89	$	148	$	8	$	-	$	2,285	$	-
Non-U.S. governments		16		-		1		(5)		-		-		12		-
Corporate debt		1,079		5		3		(153)		70		(72)		932		-
RMBS		16,487		264		346		(681)		-		(23)		16,393		-
CMBS		1,003		18		2		(274)		-		(14)		735		-
CDO/ABS		7,755		(28)		132		746		-		-		8,605		-
Total bonds available for sale		28,381		258		573		(219)		78		(109)		28,962		-
Other bond securities:
Corporate debt		18		-		-		10		-		-		28		-
RMBS		1,502		66		-		(58)		-		-		1,510		43
CMBS		65		2		-		(1)		-		-		66		2
CDO/ABS		5,508		175		-		(449)		-		-		5,234		55
Total other bond securities		7,093		243		-		(498)		-		-		6,838		100
Equity securities available for sale:
Common stock		8		-		-		-		-		(1)		7		-
Total equity securities available for sale		8		-		-		-		-		(1)		7		-
Other equity securities		-		-		-		-		-		-		-		-
Mortgage and other loans receivable		11		-		-		(6)		-		-		5		-
Other invested assets		180		4		2		39		-		-		225		4
Total	$	35,673	$	505	$	575	$	(684)	$	78	$	(110)	$	36,037	$	104
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	(Gains) Losses			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	3,072	$	340	$	-	$	106	$	-	$	-	$	3,518	$	7
Derivative liabilities, net:
Interest rate contracts		32		2		-		(4)		-		-		30		(1)
Foreign exchange contracts		6		1		-		-		-		-		7		(1)
Equity contracts		(62)		(4)		-		3		-		-		(63)		9
Commodity contracts		-		-		-		-		-		-		-		-
Credit contracts		315		(21)		-		(1)		-		-		293		23
Other contracts		(11)		(20)		-		18		(3)		-		(16)		46
Total derivative liabilities, net(a)		280		(42)		-		16		(3)		-		251		76
Long-term debt(b)		58		2		-		1		-		-		61		(2)
Total	$	3,410	$	300	$	-	$	123	$	(3)	$	-	$	3,830	$	81

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	Gains (Losses)			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Six Months Ended June 30, 2017
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,040	$	1	$	85	$	169	$	8	$	(18)	$	2,285	$	-
Non-U.S. governments		17		-		1		(6)		-		-		12		-
Corporate debt		1,133		1		-		(166)		206		(242)		932		-
RMBS		16,906		553		497		(1,539)		8		(32)		16,393		-
CMBS		2,040		23		7		(622)		-		(713)		735		-
CDO/ABS		7,835		(22)		180		644		-		(32)		8,605		-
Total bonds available for sale		29,971		556		770		(1,520)		222		(1,037)		28,962		-
Other bond securities:
Corporate debt		17		1		-		10		-		-		28		1
RMBS		1,605		121		-		(183)		-		(33)		1,510		67
CMBS		155		2		-		(18)		-		(73)		66		3
CDO/ABS		5,703		348		-		(817)		-		-		5,234		125
Total other bond securities		7,480		472		-		(1,008)		-		(106)		6,838		196
Equity securities available for sale:
Common stock		-		-		-		8		-		(1)		7		-
Total equity securities available for sale		-		-		-		8		-		(1)		7		-
Other equity securities		-		-		-		-		-		-		-		-
Mortgage and other loans receivable		11		-		-		(6)		-		-		5		-
Other invested assets		204		3		(3)		22		-		(1)		225		4
Total	$	37,666	$	1,031	$	767	$	(2,504)	$	222	$	(1,145)	$	36,037	$	200
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair Value	(Gains) Losses			Other		Sales,		Gross		Gross		Fair Value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)	Settlements, Net			In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	3,033	$	295	$	-	$	190	$	-	$	-	$	3,518	$	2
Derivative liabilities, net:
Interest rate contracts		38		(1)		-		(7)		-		-		30		2
Foreign exchange contracts		11		1		-		(5)		-		-		7		(1)
Equity contracts		(58)		(15)		-		10		-		-		(63)		14
Commodity contracts		-		-		-		-		-		-		-		-
Credit contracts		329		(36)		-		-		-		-		293		34
Other contracts		(11)		(39)		-		37		(3)		-		(16)		45
Total derivative liabilities, net(a)		309		(90)		-		35		(3)		-		251		94
Long-term debt(b)		71		14		-		(24)		-		-		61		(4)
Total	$	3,413	$	219	$	-	$	201	$	(3)	$	-	$	3,830	$	92

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		Gains (Losses)		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Three Months Ended June 30, 2016
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,196	$	2	$	136	$	(21)	$	-	$	-	$	2,313	$	-
Non-U.S. governments		30		-		-		2		-		(4)		28		-
Corporate debt		1,024		2		7		(65)		193		(325)		836		-
RMBS		16,162		234		61		61		261		-		16,779		-
CMBS		2,368		16		10		(87)		-		(12)		2,295		-
CDO/ABS		6,592		8		93		382		-		-		7,075		-
Total bonds available for sale		28,372		262		307		272		454		(341)		29,326		-
Other bond securities:
Corporate debt		18		1		-		(1)		-		-		18		1
RMBS		1,513		14		-		(41)		-		-		1,486		(19)
CMBS		170		-		-		(2)		-		-		168		9
CDO/ABS		6,576		109		-		(308)		-		(65)		6,312		(60)
Total other bond securities		8,277		124		-		(352)		-		(65)		7,984		(69)
Equity securities available for sale:
Common stock		-		-		-		-		-		-		-		-
Total equity securities available for sale		-		-		-		-		-		-		-		-
Other equity securities		15		(1)		-		-		-		-		14		-
Mortgage and other loans receivable		11		-		-		-		-		-		11		-
Other invested assets		263		(12)		6		(16)		-		-		241		-
Total	$	36,938	$	373	$	313	$	(96)	$	454	$	(406)	$	37,576	$	(69)
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		(Gains) Losses		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	3,251	$	598	$	-	$	141	$	-	$	-	$	3,990	$	16
Derivative liabilities, net:
Interest rate contracts		48		3		-		(5)		-		-		46		-
Foreign exchange contracts		9		1		-		(1)		-		-		9		(1)
Equity contracts		(51)		(4)		-		3		-		-		(52)		3
Credit contracts		490		(28)		-		(89)		-		-		373		18
Other contracts		121		(24)		-		5		-		-		102		23
Total derivatives liabilities, net(a)		617		(52)		-		(87)		-		-		478		43
Long-term debt(b)		184		(2)		-		(2)		-		(113)		67		-
Total	$	4,052	$	544	$	-	$	52	$	-	$	(113)	$	4,535	$	59

				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		Gains (Losses)		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Six Months Ended June 30, 2016
Assets:
Bonds available for sale:
Obligations of states, municipalities
and political subdivisions	$	2,124	$	2	$	194	$	(7)	$	-	$	-	$	2,313	$	-
Non-U.S. governments		32		-		(2)		2		-		(4)		28		-
Corporate debt		1,370		3		(17)		(36)		314		(798)		836		-
RMBS		16,537		479		(359)		(172)		294		-		16,779		-
CMBS		2,585		58		(78)		(168)		-		(102)		2,295		-
CDO/ABS		6,169		20		43		820		23		-		7,075		-
Total bonds available for sale		28,817		562		(219)		439		631		(904)		29,326		-
Other bond securities:
Corporate debt		17		2		-		(1)		-		-		18		3
RMBS		1,581		(23)		-		(54)		-		(18)		1,486		(61)
CMBS		193		(2)		-		(23)		-		-		168		7
CDO/ABS		7,055		(24)		-		(719)		65		(65)		6,312		(364)
Total other bond securities		8,846		(47)		-		(797)		65		(83)		7,984		(415)
Equity securities available for sale:
Common stock		-		-		-		-		-		-		-		-
Total equity securities available for sale		-		-		-		-		-		-		-		-
Other equity securities		14		-		-		-		-		-		14		1
Mortgage and other loans receivable		11		-		-		-		-		-		11		-
Other invested assets		332		(1)		1		(37)		-		(54)		241		-
Total	$	38,020	$	514	$	(218)	$	(395)	$	696	$	(1,041)	$	37,576	$	(414)
				Net												Changes in
				Realized and												Unrealized Gains
				Unrealized				Purchases,								(Losses) Included
		Fair value		(Gains) Losses		Other		Sales,		Gross		Gross		Fair value		in Income on
		Beginning		Included		Comprehensive		Issues and		Transfers		Transfers		End		Instruments Held
(in millions)		of Period		in Income		Income (Loss)		Settlements, Net		In		Out		of Period		at End of Period
Liabilities:
Policyholder contract deposits	$	2,289	$	1,443	$	-	$	258	$	-	$	-	$	3,990	$	37
Derivative liabilities, net:
Interest rate contracts		50		7		-		(11)		-		-		46		(5)
Foreign exchange contracts		7		2		-		-		-		-		9		(1)
Equity contracts		(54)		-		-		2		-		-		(52)		-
Credit contracts		505		(34)		-		(98)		-		-		373		28
Other contracts		48		30		-		24		-		-		102		(31)
Total derivatives liabilities, net(a)		556		5		-		(83)		-		-		478		(9)
Long-term debt(b)		183		-		-		(3)		-		(113)		67		3
Total	$	3,028	$	1,448	$	-	$	172	$	-	$	(113)	$	4,535	$	31

(a)Total Level 3 derivative exposures have been netted in these tables for presentation purposes only.

(b)Includes guaranteed investment agreements (GIAs), notes, bonds, loans and mortgages payable.

Schedule of net realized and unrealized gains and losses related to Level 3 items

		Net		Net Realized
		Investment		Capital		Other
(in millions)		Income	Gains (Losses)			Income		Total
Three Months Ended June 30, 2017
Bonds available for sale	$	294	$	(36)	$	-	$	258
Other bond securities		97		(4)		150		243
Other invested assets		3		1		-		4
Six Months Ended June 30, 2017
Bonds available for sale	$	592	$	(36)	$	-	$	556
Other bond securities		172		2		298		472
Other invested assets		3		(2)		2		3
Three Months Ended June 30, 2016
Bonds available for sale	$	291	$	(30)	$	1	$	262
Other bond securities		26		32		66		124
Other equity securities		(1)		-		-		(1)
Other invested assets		(1)		(19)		8		(12)
Six Months Ended June 30, 2016
Bonds available for sale	$	589	$	(29)	$	2	$	562
Other bond securities		(8)		32		(71)		(47)
Other invested assets		(3)		32		(30)		(1)
		Net		Net Realized
		Investment		Capital		Other
(in millions)		Income	Gains (Losses)			Income		Total
Three Months Ended June 30, 2017
Policyholder contract deposits	$	-	$	340	$	-	$	340
Derivative liabilities, net		-		(1)		(41)		(42)
Long-term debt		-		-		2		2
Six Months Ended June 30, 2017
Policyholder contract deposits	$	-	$	295	$	-	$	295
Derivative liabilities, net		-		(8)		(82)		(90)
Long-term debt		-		-		14		14
Three Months Ended June 30, 2016
Policyholder contract deposits	$	-	$	598	$	-	$	598
Derivative liabilities, net		-		-		(52)		(52)
Long-term debt		-		-		(2)		(2)
Six Months Ended June 30, 2016
Policyholder contract deposits	$	-	$	1,443	$	-	$	1,443
Derivative liabilities, net		-		4		1		5
Long-term debt		-		-		-		-

Gross components of purchases, sales, issues and settlements, net

								Purchases,
								Sales, Issues and
(in millions)		Purchases		Sales		Settlements		Settlements, Net(a)
Three Months Ended June 30, 2017
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	186	$	(11)	$	(27)	$	148
Non-U.S. governments		-		-		(5)		(5)
Corporate debt		30		(54)		(129)		(153)
RMBS		301		-		(982)		(681)
CMBS		-		(44)		(230)		(274)
CDO/ABS		1,194		-		(448)		746
Total bonds available for sale		1,711		(109)		(1,821)		(219)
Other bond securities:
Corporate debt		11		-		(1)		10
RMBS		14		-		(72)		(58)
CMBS		-		-		(1)		(1)
CDO/ABS		-		(8)		(441)		(449)
Total other bond securities		25		(8)		(515)		(498)
Equity securities available for sale		-		-		-		-
Other equity securities		-		-		-		-
Mortgage and other loans receivable		-		(6)		-		(6)
Other invested assets		42		(2)		(1)		39
Total assets	$	1,778	$	(125)	$	(2,337)	$	(684)
Liabilities:
Policyholder contract deposits	$	-	$	82	$	24	$	106
Derivative liabilities, net		-		-		16		16
Long-term debt(b)		-		-		1		1
Total liabilities	$	-	$	82	$	41	$	123
Three Months Ended June 30, 2016
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	17	$	(7)	$	(31)	$	(21)
Non-U.S. governments		2		-		-		2
Corporate debt		-		(25)		(40)		(65)
RMBS		1,040		-		(979)		61
CMBS		4		(27)		(64)		(87)
CDO/ABS		612		(11)		(219)		382
Total bonds available for sale		1,675		(70)		(1,333)		272
Other bond securities:
Corporate debt		-		-		(1)		(1)
RMBS		26		-		(67)		(41)
CMBS		-		-		(2)		(2)
CDO/ABS		61		(19)		(350)		(308)
Total other bond securities		87		(19)		(420)		(352)
Equity securities available for sale		-		-		-		-
Other invested assets		9		(2)		(23)		(16)
Total assets	$	1,771	$	(91)	$	(1,776)	$	(96)

Liabilities:
Policyholder contract deposits	$	-	$	140	$	1	$	141
Derivative liabilities, net		(1)		-		(86)		(87)
Long-term debt(b)		-		-		(2)		(2)
Total liabilities	$	(1)	$	140	$	(87)	$	52
								Purchases,
								Sales, Issues and
(in millions)		Purchases		Sales		Settlements		Settlements, Net(a)
Six Months Ended June 30, 2017
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions	$	223	$	(16)	$	(38)	$	169
Non-U.S. governments		-		(1)		(5)		(6)
Corporate debt		30		(54)		(142)		(166)
RMBS		640		(244)		(1,935)		(1,539)
CMBS		39		(111)		(550)		(622)
CDO/ABS		1,207		-		(563)		644
Total bonds available for sale		2,139		(426)		(3,233)		(1,520)
Other bond securities:
Corporate debt		11		-		(1)		10
RMBS		112		(167)		(128)		(183)
CMBS		-		(11)		(7)		(18)
CDO/ABS		-		(8)		(809)		(817)
Total other bond securities		123		(186)		(945)		(1,008)
Equity securities available for sale		8		-		-		8
Other equity securities		-		-		-		-
Mortgage and other loans receivable		-		(6)		-		(6)
Other invested assets		43		(2)		(19)		22
Total assets	$	2,313	$	(620)	$	(4,197)	$	(2,504)
Liabilities:
Policyholder contract deposits	$	-	$	152	$	38	$	190
Derivative liabilities, net		-		-		35		35
Long-term debt(b)		-		-		(24)		(24)
Total liabilities	$	-	$	152	$	49	$	201
Six Months Ended June 30, 2016
Assets:
Bonds available for sale:
Obligations of states, municipalities and political subdivisions(c)	$	46	$	(7)	$	(46)	$	(7)
Non-U.S. governments		3		-		(1)		2
Corporate debt		29		(25)		(40)		(36)
RMBS		1,543		(58)		(1,657)		(172)
CMBS		106		(58)		(216)		(168)
CDO/ABS		1,151		(11)		(320)		820
Total bonds available for sale		2,878		(159)		(2,280)		439
Other bond securities:
Corporate debt		-		-		(1)		(1)
RMBS		89		(26)		(117)		(54)
CMBS		53		(71)		(5)		(23)
CDO/ABS		69		(36)		(752)		(719)
Total other bond securities		211		(133)		(875)		(797)
Equity securities available for sale		-		-		-		-
Other equity securities		14		-		(14)		-
Other invested assets		18		(2)		(53)		(37)
Total assets	$	3,121	$	(294)	$	(3,222)	$	(395)

Liabilities:
Policyholder contract deposits	$	-	$	270	$	(12)	$	258
Derivative liabilities, net		(3)		-		(80)		(83)
Long-term debt(b)		-		-		(3)		(3)
Total liabilities	$	(3)	$	270	$	(95)	$	172

(a)There were no issuances during thethree-month periods ended June 30,2017 and 2016, respectively.

(b) Includes GIAs, notes, bonds, loans and mortgages payable.

Significant unobservable inputs used for recurring fair value measurements

	Fair Value at
	June 30,		Valuation		Range
(in millions)	2017		Technique	Unobservable Input(b)	(Weighted Average)
Assets:
Obligations of states, municipalities
and political subdivisions	$	1,494	Discounted cash flow	Yield	3.75% - 4.68% (4.21%)
Corporate debt		454	Discounted cash flow	Yield	3.90% - 4.58% (4.24%)
RMBS(a)		16,471	Discounted cash flow	Constant prepayment rate	2.26% - 10.48% (6.37%)
				Loss severity	47.43% - 79.54% (63.49%)
				Constant default rate	3.23% - 7.98% (5.61%)
				Yield	2.96% - 5.32% (4.14%)
CDO/ABS(a)		5,030	Discounted cash flow	Yield	3.27% - 5.33% (4.30%)
CMBS		542	Discounted cash flow	Yield	2.39% - 8.01% (5.20%)
Liabilities:
Embedded derivatives within
Policyholder contract deposits:
Guaranteed minimum withdrawal benefits (GMWB)		1,917	Discounted cash flow	Equity volatility	8.00% - 50.00%
				Base lapse rate	0.50% - 20.00%
				Dynamic lapse multiplier	30.00% - 170.00%
				Mortality multiplier(c)	42.00% - 161.00%
				Utilization	100.00%
				Equity / interest-rate correlation	20.00% - 40.00%
Index Annuities		1,140	Discounted cash flow	Lapse rate	1.00% - 66.00%
				Mortality multiplier(c)	101.00% - 103.00%
Indexed Life		443	Discounted cash flow	Base lapse rate	2.00% to 19.00%
				Mortality rate	0.00% to 40.00%

		Fair Value at
		December 31,	Valuation		Range
(in millions)		2016	Technique	Unobservable Input(b)	(Weighted Average)
Assets:
Obligations of states, municipalities
and political subdivisions	$	1,248	Discounted cash flow	Yield	4.12% - 4.91% (4.52%)
Corporate debt		498	Discounted cash flow	Yield	3.41% - 6.38% (4.90%)
RMBS(a)		17,412	Discounted cash flow	Constant prepayment rate	3.95% - 6.54% (5.25%)
				Loss severity	47.51% - 80.98% (64.24%)
				Constant default rate	3.28% - 8.64% (5.96%)
				Yield	3.28% - 5.87% (4.57%)
CDO/ABS(a)		4,368	Discounted cash flow	Yield	3.67% - 5.85% (4.76%)
CMBS		1,511	Discounted cash flow	Yield	0.48% - 10.21% (5.34%)
Liabilities:
Embedded derivatives within
Policyholder contract deposits:
GMWB		1,777	Discounted cash flow	Equity volatility	13.00% - 50.00%
				Base lapse rate	0.50% - 20.00%
				Dynamic lapse multiplier	30.00% - 170.00%
				Mortality multiplier(c)	42.00% - 161.00%
				Utilization	100.00%
				Equity / interest-rate correlation	20.00% - 40.00%
Index Annuities		859	Discounted cash flow	Lapse rate	1.00% - 66.00%
				Mortality multiplier(c)	101.00% - 103.00%
Indexed Life		381	Discounted cash flow	Base lapse rate	2.00% - 19.00%
				Mortality rate	0.00% - 40.00%

(a) Information received from third-party valuation service providers. The ranges of the unobservable inputs for constant prepayment rate, loss severity and constant default rate relate to each of the individual underlying mortgage loans that comprise the entire portfolio of securities in the RMBS and CDO securitization vehicles and not necessarily to the securitization vehicle bonds (tranches) purchased by us. The ranges of these inputs do not directly correlate to changes in the fair values of the tranches purchased by us, because there are other factors relevant to the fair values of specific tranches owned by us including, but not limited to, purchase price, position in the waterfall, senior versus subordinated position and attachment points.

(b) Represents discount rates, estimates and assumptions that we believe would be used by market participants when valuing these assets and liabilities.

(c)Mortality inputs are shown as multipliers of the 2012 Individual Annuity Mortality Basic table for GMWB, and the 1975-1980 Modified Basic Table for index annuities.

Investments in Certain Entities Carried at Fair Value Using Net Asset Value per Share

		June 30, 2017				December 31, 2016
			Fair Value			Fair Value
			Using NAV			Using NAV
			Per Share (or		Unfunded	Per Share (or			Unfunded
(in millions)	Investment Category Includes		its equivalent)		Commitments	its equivalent)			Commitments
Investment Category
Private equity funds:
Leveraged buyout	Debt and/or equity investments made as part of a transaction in which assets of mature companies are acquired from the current shareholders, typically with the use of financial leverage	$	1,298	$	799	$	1,424	$	750
Real Estate / Infrastructure	Investments in real estate properties and infrastructure positions, including power plants and other energy generating facilities		230		182		258		208
Venture capital	Early-stage, high-potential, growth companies expected to generate a return through an eventual realization event, such as an initial public offering or sale of the company		123		34		137		31
Distressed	Securities of companies that are in default, under bankruptcy protection, or troubled		103		43		123		44
Other	Includes multi-strategy, mezzanine and other strategies		367		264		312		215
Total private equity funds			2,121		1,322		2,254		1,248
Hedge funds:
Event-driven	Securities of companies undergoing material structural changes, including mergers, acquisitions and other reorganizations		1,315		-		1,453		9
Long-short	Securities that the manager believes are undervalued, with corresponding short positions to hedge market risk		1,370		-		1,429		-
Macro	Investments that take long and short positions in financial instruments based on a top-down view of certain economic and capital market conditions		1,036		-		992		-
Distressed	Securities of companies that are in default, under bankruptcy protection or troubled		308		7		416		8
Other	Includes investments held in funds that are less liquid, as well as other strategies which allow for broader allocation between public and private investments		223		7		197		14
Total hedge funds			4,252		14		4,487		31
Total		$	6,373	$	1,336	$	6,741	$	1,279

Gains or losses related to the eligible instruments for which AIG elected the fair value option

	Gain (Loss) Three Months Ended June 30,				Gain (Loss) Six Months Ended June 30,
(in millions)		2017		2016		2017		2016
Assets:
Bond and equity securities	$	450	$	248	$	799	$	298
Alternative Investments(a)		96		33		277		(214)
Other, including Short-term investments		-		-		-		-
Liabilities:
Long-term debt(b)		(33)		(71)		(48)		(247)
Other liabilities		(1)		-		(1)		-
Total gain (loss)	$	512	$	210	$	1,027	$	(163)

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

(b)Includes GIAs, notes, bonds and mortgages payable.

Difference between fair values and aggregate contractual principal amounts, fair value option

	June 30, 2017						December 31, 2016
			Outstanding						Outstanding
(in millions)	Fair Value		Principal Amount		Difference		Fair Value		Principal Amount		Difference
Assets:
Mortgage and other loans receivable	$	5	$	5	$	-	$	11	$	8	$	3
Liabilities:
Long-term debt*	$	3,085	$	2,351	$	734	$	3,428	$	2,628	$	800

*Includes GIAs, notes, bonds, loans and mortgages payable.

Fair value assets measured on nonrecurring basis and impairment charges

	Assets at Fair Value								Impairment Charges
	Non-Recurring Basis								Three Months Ended June 30,				Six Months Ended June 30,
(in millions)	Level 1		Level 2		Level 3			Total		2017		2016		2017		2016
June 30, 2017
Other investments	$	-	$	-	$	17	$	17	$	33	$	29	$	50	$	31
Investments in life settlements		-		-		253		253		46		92		87		249
Other assets*		-		-		-		-		-		9		35		9
Total	$	-	$	-	$	270	$	270	$	79	$	130	$	172	$	289
December 31, 2016
Other investments	$	-	$	-	$	364	$	364
Investments in life settlements		-		-		736		736
Other assets		-		-		2		2
Total	$	-	$	-	$	1,102	$	1,102

* Impairments include $35 million related to other assets that were sold during the three month period ended June 30,2017.

Carrying values and estimated fair values of AIG's financial instruments

	Estimated Fair Value									Carrying
(in millions)		Level 1		Level 2		Level 3		Total		Value
June 30, 2017
Assets:
Mortgage and other loans receivable	$	-	$	156	$	35,593	$	35,749	$	34,637
Other invested assets		-		630		1,736		2,366		2,748
Short-term investments		-		8,689		-		8,689		8,689
Cash		2,517		-		-		2,517		2,517
Liabilities:
Policyholder contract deposits associated
with investment-type contracts		-		354		123,945		124,299		113,474
Other liabilities		-		4,395		-		4,395		4,395
Long-term debt		-		24,120		3,645		27,765		28,727
December 31, 2016
Assets:
Mortgage and other loans receivable	$	-	$	161	$	33,575	$	33,736	$	33,229
Other invested assets		-		955		2,053		3,008		3,474
Short-term investments		-		8,961		-		8,961		8,961
Cash		1,868		-		-		1,868		1,868
Liabilities:
Policyholder contract deposits associated
with investment-type contracts		-		382		121,742		122,124		112,705
Other liabilities		-		4,196		-		4,196		4,196
Long-term debt		-		23,117		3,333		26,450		27,484