Fair Value Measurements (Tables)

December 31, 2016
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Financial assets at fair value:
Fixed maturities:
Federal government and agency	$	374	$	503	$	-	$	877
State and local government		-		1,435		-		1,435
Foreign government		-		2,066		47		2,113
Corporate		-		15,552		498		16,050
Mortgage and other asset-backed		-		329		157		486
Total fixed maturities⁽¹⁾		374		19,885		702		20,961
Equity securities		396		113		74		583
Subtotal		770		19,998		776		21,544
Short-term investments		-		691		-		691
GMIB assets		-		-		799		799
Other derivative assets		-		10		-		10
Total financial assets at fair value, excluding separate accounts	$	770	$	20,699	$	1,575	$	23,044
GMIB liabilities	$	-	$	-	$	780	$	780
Other derivative liabilities		-		5		-		5
Total financial liabilities at fair value	$	-	$	5	$	780	$	785

(1) Fixed maturities included $524 million of net appreciation required to adjust future policy benefits for the run-off settlement annuity business including $14 million of appreciation for securities classified in Level 3. See Note 11A for additional information.

December 31, 2015
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Financial assets at fair value:
Fixed maturities:
Federal government and agency	$	251	$	528	$	-	$	779
State and local government		-		1,641		-		1,641
Foreign government		-		2,010		4		2,014
Corporate		-		14,122		326		14,448
Mortgage and other asset-backed		-		246		327		573
Total fixed maturities⁽¹⁾		251		18,547		657		19,455
Equity securities		32		89		69		190
Subtotal		283		18,636		726		19,645
Short-term investments		-		381		-		381
GMIB assets		-		-		907		907
Other derivative assets		-		16		-		16
Total financial assets at fair value, excluding separate accounts	$	283	$	19,033	$	1,633	$	20,949
GMIB liabilities	$	-	$	-	$	885	$	885
Total financial liabilities at fair value	$	-	$	-	$	885	$	885

(1) Fixed maturities included $483 million of net appreciation required to adjust future policy benefits for the run-off settlement annuity business including $30 million of appreciation for securities classified in Level 3. See Note 11A for additional information.


As of December 31, 2016			Unobservable Input	Unobservable Adjustment Range (Weighted Average)
(Fair value in millions )		Fair Value	Unobservable Input	Unobservable Adjustment Range (Weighted Average)
Fixed maturities:
Mortgage and other asset-backed securities	$	157	Liquidity	60 - 330 (90) bps
			Weighting of credit spreads	160 - 470 (230) bps
Corporate and government fixed maturities		490	Liquidity	80 - 1,300 (340) bps
Total fixed maturities		647
Equity securities		74	Price-to-EBITDA multiples	4.2 - 11.6 (8.5)
Subtotal		721
Securities not priced by the Company⁽¹⁾		55
Total Level 3 securities	$	776
(1) The fair values for these securities use single, unadjusted non-binding broker quotes not developed directly by the Company.

As of December 31, 2015
Fixed maturities:
Mortgage and other asset-backed securities	$	327	Liquidity	60 - 440 (200) bps
			Weighting of credit spreads	170 - 630 (220) bps
Corporate and government fixed maturities		285	Liquidity	70 - 930 (280) bps
Total fixed maturities		612
Equity securities		69	Price-to-EBITDA multiples	4.2 - 11.6 (8.3)
Subtotal		681
Securities not priced by the Company⁽¹⁾		45
Total Level 3 securities	$	726
(1) The fair values for these securities use single, unadjusted non-binding broker quotes not developed directly by the Company.

	Fixed Maturities & Equity Securities		GMIB Assets		GMIB Liabilities		GMIB Net
(In millions)	Fixed Maturities & Equity Securities		GMIB Assets		GMIB Liabilities		GMIB Net
Balance at January 1, 2016	$	726	$	907	$	(885)	$	22
Gains (losses) included in shareholders' net income:
GMIB fair value gain/(loss)		-		(47)		47		-
Other		(18)		-		(3)		(3)
Total gains (losses) included in shareholders' net income		(18)		(47)		44		(3)
Losses included in other comprehensive income		(1)		-		-		-
Gains required to adjust future policy benefits for settlement annuities⁽¹⁾		29		-		-		-
Purchases, sales, settlements:
Purchases		96		-		-		-
Sales		(140)		-		-		-
Settlements		(74)		(61)		61		-
Total purchases, sales and settlements		(118)		(61)		61		-
Transfers into/(out of) Level 3:
Transfers into Level 3		338		-		-		-
Transfers out of Level 3		(180)		-		-		-
Total transfers into/(out of) Level 3		158		-		-		-
Balance at December 31, 2016	$	776	$	799	$	(780)	$	19
Total gains (losses) included in shareholders' net income attributable
to instruments held at the reporting date	$	(18)	$	(47)	$	44	$	(3)

Balance at January 1, 2015	$	857	$	953	$	(929)	$	24
Gains (losses) included in shareholders' net income:
GMIB fair value gain/(loss)		-		(5)		2		(3)
Other		24		1		-		1
Total gains (losses) included in shareholders' net income		24		(4)		2		(2)
Losses included in other comprehensive income		(11)		-		-		-
Losses required to adjust future policy benefits for settlement annuities⁽¹⁾		(1)		-		-		-
Purchases, sales, settlements:
Purchases		153		-		-		-
Sales		(230)		-		-		-
Settlements		(21)		(42)		42		-
Total purchases, sales and settlements		(98)		(42)		42		-
Transfers into/(out of) Level 3:
Transfers into Level 3		49		-		-		-
Transfers out of Level 3		(94)		-		-		-
Total transfers into/(out of) Level 3		(45)		-		-		-
Balance at December 31, 2015	$	726	$	907	$	(885)	$	22
Total gains (losses) included in shareholders' net income attributable
to instruments held at the reporting date	$	(6)	$	(4)	$	2	$	(2)

(1) Amounts do not accrue to shareholders.

2016
(In millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Guaranteed separate accounts (See Note 21)	$	238	$	262	$	-	$	500
Non-guaranteed separate accounts ⁽¹⁾		1,368		4,885		331		6,584
Subtotal	$	1,606	$	5,147	$	331	$	7,084
Non-guaranteed separate accounts priced at NAV as a practical expedient⁽¹⁾								856
Total separate account assets							$	7,940

2015
Guaranteed separate accounts (See Note 21)	$	235	$	274	$	-	$	509
Non-guaranteed separate accounts ⁽¹⁾		1,401		4,698		297		6,396
Subtotal	$	1,636	$	4,972	$	297	$	6,905
Non-guaranteed separate accounts priced at NAV as a practical expedient⁽¹⁾								928
Total separate account assets							$	7,833

(1) Non-guaranteed separate accounts included $3.7 billion as of December 31, 2016 and $3.6 billion as of December 31, 2015 in assets supporting the Company's pension plans, including $0.3 billion classified in Level 3 and $0.9 billion priced at NAV as a practical expedient for both periods.

(In millions)		2016		2015
Balance at January 1	$	297	$	255
Policyholder gains (losses)		2		(6)
Purchases, issuances, settlements:
Purchases		22		59
Sales		(11)		-
Settlements		(18)		(16)
Total purchases, sales and settlements		(7)		43
Transfers into/(out of) Level 3:
Transfers into Level 3		65		17
Transfers out of Level 3		(26)		(12)
Total transfers into/(out of) Level 3:		39		5
Balance at December 31	$	331	$	297

	Fair Value as of
(In millions)	December 31, 2016		December 31, 2015		Unfunded Commitments		Redemption Frequency (if currently eligible)⁽¹⁾	Redemption Notice Period⁽¹⁾
Security Partnerships	$	424	$	406	$	286	Not applicable	Not applicable
Real Estate Funds		231		261		-	Quarterly	45-90 days
Hedge Funds		201		261		-	Up to Annually, varying by fund	30-90 days
Total	$	856	$	928	$	286
(1) The attributes noted are effective as of December 31, 2016 and 2015.

(In millions)			December 31, 2016				December 31, 2015
	Classification in Fair Value Hierarchy		Fair Value		Carrying Value		Fair Value		Carrying Value
Commercial mortgage loans	Level 3	$	1,682	$	1,666	$	1,911	$	1,864
Contractholder deposit funds, excluding universal life products	Level 3	$	1,215	$	1,212	$	1,151	$	1,148
Long-term debt, including current maturities, excluding capital leases	Level 2	$	5,460	$	4,991	$	5,515	$	5,020

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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