Investments

A summary of short-term and long-term investments is as follows:



(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
December 31, 2011
Debt securities - available-for-sale:
U.S. government and agency obligations	$	2,319	$	54	$	—		$	2,373
State and municipal obligations	6,363		403		(1		)	6,765
Corporate obligations	5,825		205		(23		)	6,007
U.S. agency mortgage-backed securities	2,279		74		—			2,353
Non-U.S. agency mortgage-backed securities	476		28		—			504
Total debt securities - available-for-sale	17,262		764		(24		)	18,002
Equity securities - available-for-sale	529		23		(8		)	544
Debt securities - held-to-maturity:
U.S. government and agency obligations	166		7		—			173
State and municipal obligations	13		—		—			13
Corporate obligations	18		—		—			18
Total debt securities - held-to-maturity	197		7		—			204
Total investments	$	17,988	$	794	$	(32	)	$	18,750
December 31, 2010
Debt securities - available-for-sale:
U.S. government and agency obligations	$	2,214	$	28	$	(8	)	$	2,234
State and municipal obligations	6,007		183		(42		)	6,148
Corporate obligations	5,111		210		(11		)	5,310
U.S. agency mortgage-backed securities	1,851		58		(6		)	1,903
Non-U.S. agency mortgage-backed securities	439		26		—			465
Total debt securities - available-for-sale	15,622		505		(67		)	16,060
Equity securities - available-for-sale	508		22		(14		)	516
Debt securities - held-to-maturity:
U.S. government and agency obligations	167		5		—			172
State and municipal obligations	15		—		—			15
Corporate obligations	21		—		—			21
Total debt securities - held-to-maturity	203		5		—			208
Total investments	$	16,333	$	532	$	(81	)	$	16,784

Included in the Company’s investment portfolio were securities collateralized by sub-prime home equity lines of credit with fair values of $2 million and $6 million as of December 31, 2011 and December 31, 2010, respectively. Also included were Alt-A securities with fair values of $9 million and $15 million as of December 31, 2011 and December 31, 2010, respectively.

The fair values of the Company’s mortgage-backed securities by credit rating (when multiple credit ratings are available for an individual security, the average of the available ratings is used) and origination as of December 31, 2011 were as follows:



(in millions)	AAA		AA		A		Non-Investment Grade		Total Fair Value
2011	$	26	$	—	$	—	$	—	$	26
2010	—		3		—		—		3
2007	93		—		—		3		96
2006	167		—		—		10		177
2005	136		—		—		3		139
Pre - 2005	60		—		3		—		63
U.S. agency mortgage-backed securities	2,353		—		—		—		2,353
Total	$	2,835	$	3	$	3	$	16	$	2,857

The amortized cost and fair value of available-for-sale debt securities as of December 31, 2011, by contractual maturity, were as follows:



(in millions)	Amortized Cost		Fair Value
Due in one year or less	$	2,629	$	2,641
Due after one year through five years	5,631		5,808
Due after five years through ten years	4,439		4,763
Due after ten years	1,808		1,933
U.S. agency mortgage-backed securities	2,279		2,353
Non-U.S. agency mortgage-backed securities	476		504
Total debt securities - available-for-sale	$	17,262	$	18,002

The amortized cost and fair value of held-to-maturity debt securities as of December 31, 2011, by contractual maturity, were as follows:



(in millions)	Amortized Cost		Fair Value
Due in one year or less	$	43	$	43
Due after one year through five years	124		127
Due after five years through ten years	21		22
Due after ten years	9		12
Total debt securities - held-to-maturity	$	197	$	204

The fair value of available-for-sale investments with gross unrealized losses by investment type and length of time that individual securities have been in a continuous unrealized loss position were as follows:



	Less Than 12 Months					12 Months or Greater					Total
(in millions)	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
December 31, 2011
Debt securities - available-for-sale:
State and municipal obligations	$	85	$	(1	)	$	21	$	—		$	106	$	(1	)
Corporate obligations	1,496		(22		)	28		(1		)	1,524		(23		)
Total debt securities - available-for-sale	$	1,581	$	(23	)	$	49	$	(1	)	$	1,630	$	(24	)
Equity securities - available-for-sale	$	24	$	(7	)	$	3	$	(1	)	$	27	$	(8	)
December 31, 2010
Debt securities - available-for-sale:
U.S. government and agency obligations	$	548	$	(8	)	$	—	$	—		$	548	$	(8	)
State and municipal obligations	1,383		(40		)	18		(2		)	1,401		(42		)
Corporate obligations	949		(11		)	14		—			963		(11		)
U.S. agency mortgage-backed securities	355		(6		)	—		—			355		(6		)
Total debt securities - available-for-sale	$	3,235	$	(65	)	$	32	$	(2	)	$	3,267	$	(67	)
Equity securities - available-for-sale	$	206	$	(14	)	$	11	$	—		$	217	$	(14	)

The unrealized losses from all securities as of December 31, 2011 were generated from 2,100 positions out of a total of 15,300 positions. The Company believes that it will collect the principal and interest due on its investments that have an amortized cost in excess of fair value. The unrealized losses on investments in state and municipal obligations and corporate obligations as of December 31, 2011 were primarily caused by interest rate increases and not by unfavorable changes in the credit ratings associated with these securities. At each reporting period, the Company evaluates securities for impairment when the fair value of the investment is less than its amortized cost. The Company evaluated the underlying credit quality of the issuers and the credit ratings of the state and municipal obligations and the corporate obligations, noting neither a significant deterioration since purchase nor other factors leading to an other-than-temporary impairment (OTTI). As of December 31, 2011, the Company did not have the intent to sell any of the securities in an unrealized loss position.

As of December 31, 2011, the Company’s holdings of non-U.S. agency mortgage-backed securities included $7 million of commercial mortgage loans in default. They represented less than 1% of the Company’s total mortgage-backed security holdings as of December 31, 2011.

A portion of the Company’s investments in equity securities and venture capital funds consists of investments held in various public and nonpublic companies concentrated in the areas of health care services and related information technologies. Market conditions that affect the value of health care and related technology stocks will likewise impact the value of the Company’s equity portfolio. The equity securities and venture capital funds were evaluated for severity and duration of unrealized loss, overall market volatility and other market factors.

Net realized gains included in Investment and Other Income on the Consolidated Statements of Operations were from the following sources:



	For the Year Ended December 31,
(in millions)	2011			2010			2009
Total OTTI	$	(12	)	$	(23	)	$	(64	)
Portion of loss recognized in other comprehensive income	—			—			—
Net OTTI recognized in earnings	(12		)	(23		)	(64		)
Gross realized losses from sales	(11		)	(6		)	(41		)
Gross realized gains from sales	136			100			116
Net realized gains	$	113		$	71		$	11

For the years ended December 31, 2011, 2010 and 2009, all of the recorded OTTI charges resulted from the Company’s intent to sell certain impaired securities.