Investments

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Investments

4. Investments

See Note 6 for information about the fair value hierarchy for investments and the related valuation methodologies.

Fixed Maturity Securities AFS

Fixed Maturity Securities AFS by Sector

The following table presents the fixed maturity securities AFS by sector at:

	June 30, 2018											December 31, 2017
	Amortized Cost		Gross Unrealized							Estimated Fair Value		Amortized Cost		Gross Unrealized							Estimated Fair Value
			Gains		Temporary Losses		OTTI Losses (1)							Gains		Temporary Losses		OTTI Losses (1)
	(In millions)
Fixed maturity securities: (2)
U.S. corporate	$	22,439	$	963	$	439	$	—		$	22,963	$	20,647	$	1,822	$	89	$	—		$	22,380
U.S. government and agency	10,871		1,397		190		—			12,078		14,185		1,844		116		—			15,913
RMBS	7,615		249		173		(4		)	7,695		7,588		283		57		(3		)	7,817
Foreign corporate	6,751		171		176		—			6,746		6,457		376		62		—			6,771
State and political subdivision	3,583		435		25		(2		)	3,995		3,573		532		6		1			4,098
CMBS	3,967		10		87		(1		)	3,891		3,259		48		17		(1		)	3,291
ABS	2,041		14		5		—			2,050		1,779		19		2		—			1,796
Foreign government	1,256		104		25		—			1,335		1,111		159		3		—			1,267
Total fixed maturity securities	$	58,523	$	3,343	$	1,120	$	(7	)	$	60,753	$	58,599	$	5,083	$	352	$	(3	)	$	63,333

__________________

(1) Noncredit OTTI losses included in AOCI in an unrealized gain position are due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. See also “— Net Unrealized Investment Gains (Losses).”

(2) Redeemable preferred stock is reported within U.S. corporate and foreign corporate fixed maturity securities. Included within fixed maturity securities are structured securities including residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”) and asset-backed securities (“ABS”) (collectively, “Structured Securities”).

The Company held non-income producing fixed maturity securities with an estimated fair value of $6 million and $3 million with unrealized gains (losses) of $2 million and ($2) million at June 30, 2018 and December 31, 2017, respectively.

Maturities of Fixed Maturity Securities

The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at June 30, 2018:

	Due in One Year or Less		Due After One Year Through Five Years		Due After Five Years Through Ten Years		Due After Ten Years		Structured Securities		Total Fixed Maturity Securities
	(In millions)
Amortized cost	$	1,730	$	8,028	$	11,339	$	23,803	$	13,623	$	58,523
Estimated fair value	$	1,736	$	8,111	$	11,234	$	26,036	$	13,636	$	60,753

Actual maturities may differ from contractual maturities due to the exercise of call or prepayment options. Fixed maturity securities not due at a single maturity date have been presented in the year of final contractual maturity. Structured Securities are shown separately, as they are not due at a single maturity.

Continuous Gross Unrealized Losses for Fixed Maturity Securities AFS by Sector

The following table presents the estimated fair value and gross unrealized losses of fixed maturity securities AFS in an unrealized loss position, aggregated by sector and by length of time that the securities have been in a continuous unrealized loss position at:

	June 30, 2018								December 31, 2017
	Less than 12 Months				Equal to or Greater than 12 Months				Less than 12 Months				Equal to or Greater than 12 Months
	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
	(Dollars in millions)
Fixed maturity securities:
U.S. corporate	$	9,566	$	321	$	1,229	$	118	$	1,762	$	21	$	1,413	$	68
U.S. government and agency	2,587		61		1,318		129		4,764		36		1,573		80
RMBS	3,209		95		1,103		74		2,308		13		1,292		41
Foreign corporate	2,924		105		433		71		636		8		559		54
State and political subdivision	577		15		102		8		171		3		106		4
CMBS	2,897		66		344		20		603		6		335		10
ABS	735		4		33		1		165		—		75		2
Foreign government	500		21		68		4		152		2		50		1
Total fixed maturity securities	$	22,995	$	688	$	4,630	$	425	$	10,561	$	89	$	5,403	$	260
Total number of securities in an unrealized loss position	2,770				574				903				619

Evaluation of AFS Securities for OTTI and Evaluating Temporarily Impaired AFS Securities

Evaluation and Measurement Methodologies

Management considers a wide range of factors about the security issuer and uses its best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for near-term recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. Considerations used in the impairment evaluation process include, but are not limited to: (i) the length of time and the extent to which the estimated fair value has been below amortized cost; (ii) the potential for impairments when the issuer is experiencing significant financial difficulties; (iii) the potential for impairments in an entire industry sector or sub-sector; (iv) the potential for impairments in certain economically depressed geographic locations; (v) the potential for impairments where the issuer, series of issuers or industry has suffered a catastrophic loss or has exhausted natural resources; (vi) whether the Company has the intent to sell or will more likely than not be required to sell a particular security before the decline in estimated fair value below amortized cost recovers; (vii) with respect to Structured Securities, changes in forecasted cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security; (viii) the potential for impairments due to weakening of foreign currencies on non-functional currency denominated fixed maturity securities that are near maturity; and (ix) other subjective factors, including concentrations and information obtained from regulators and rating agencies.

Current Period Evaluation

Based on the Company’s current evaluation of its AFS securities in an unrealized loss position in accordance with its impairment policy, and the Company’s current intentions and assessments (as applicable to the type of security) about holding, selling and any requirements to sell these securities, the Company concluded that these securities were not other-than-temporarily impaired at June 30, 2018.

Gross unrealized losses on fixed maturity securitiesincreased$764 millionduring thesix monthsendedJune 30, 2018to$1.1 billion. The increase in gross unrealized losses for thesix monthsendedJune 30, 2018was primarily attributable to increasing longer-term interest rates and widening credit spreads.

At June 30, 2018, $2 million of the total $1.1 billion of gross unrealized losses were from seven fixed maturity securities with an unrealized loss position of 20% or more of amortized cost for six months or greater.

Mortgage Loans

Mortgage Loans by Portfolio Segment

Mortgage loans are summarized as follows at:

	June 30, 2018					December 31, 2017
	Carrying Value			% of Total		Carrying Value			% of Total
	(Dollars in millions)
Mortgage loans:
Commercial	$	8,058		65.8	%	$	7,233		67.9	%
Agricultural	2,557			20.9		2,200			20.7
Residential	1,577			12.9		1,138			10.7
Subtotal (1)	12,192			99.6		10,571			99.3
Valuation allowances (2)	(51		)	(0.4	)	(46		)	(0.4	)
Subtotal mortgage loans, net	12,141			99.2		10,525			98.9
Commercial mortgage loans held by CSEs — FVO	96			0.8		115			1.1
Total mortgage loans, net	$	12,237		100.0	%	$	10,640		100.0	%

__________________

(1) Purchases of mortgage loans from third parties were $518 million and $604 million for the three months and six months endedJune 30, 2018, respectively, and $147 million and $307 million for the three months and six months endedJune 30, 2017, respectively, and were primarily comprised of residential mortgage loans.

(2) The valuation allowances were primarily from collective evaluation (non-specific loan related).    

See “— Variable Interest Entities” for discussion of consolidated securitization entities (“CSEs”).

Information on commercial, agricultural and residential mortgage loans is presented in the tables below. Information on commercial mortgage loans held by CSEs — FVO is presented in Note 6. The Company elects the FVO for certain commercial mortgage loans and related long-term debt that are managed on a total return basis.

Valuation Allowance Methodology

Mortgage loans are considered to be impaired when it is probable that, based upon current information and events, the Company will be unable to collect all amounts due under the loan agreement. Specific valuation allowances are established using the same methodology for all three portfolio segments as the excess carrying value of a loan over either (i) the present value of expected future cash flows discounted at the loan’s original effective interest rate, (ii) the estimated fair value of the loan’s underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan’s observable market price. A common evaluation framework is used for establishing non-specific valuation allowances for all loan portfolio segments; however, a separate non-specific valuation allowance is calculated and maintained for each loan portfolio segment that is based on inputs unique to each loan portfolio segment. Non-specific valuation allowances are established for pools of loans with similar risk characteristics where a property-specific or market-specific risk has not been identified, but for which the Company expects to incur a credit loss. These evaluations are based upon several loan portfolio segment-specific factors, including the Company’s experience for loan losses, defaults and loss severity, and loss expectations for loans with similar risk characteristics. These evaluations are revised as conditions change and new information becomes available.

Credit Quality of Commercial Mortgage Loans

The credit quality of commercial mortgage loans was as follows at:

	Recorded Investment
	Debt Service Coverage Ratios								% of Total		Estimated Fair Value		% of Total
	> 1.20x		1.00x - 1.20x		< 1.00x		Total
	(Dollars in millions)
June 30, 2018
Loan-to-value ratios:
Less than 65%	$	7,059	$	115	$	33	$	7,207	89.5	%	$	7,244	89.5	%
65% to 75%	612		107		81		800		9.9		797		9.9
76% to 80%	42		—		9		51		0.6		49		0.6
Total	$	7,713	$	222	$	123	$	8,058	100.0	%	$	8,090	100.0	%
December 31, 2017
Loan-to-value ratios:
Less than 65%	$	6,167	$	293	$	33	$	6,493	89.7	%	$	6,654	90.0	%
65% to 75%	642		—		14		656		9.1		658		8.9
76% to 80%	42		—		9		51		0.7		50		0.7
Greater than 80%	—		9		24		33		0.5		30		0.4
Total	$	6,851	$	302	$	80	$	7,233	100.0	%	$	7,392	100.0	%

Credit Quality of Agricultural Mortgage Loans

The credit quality of agricultural mortgage loans was as follows at: 

	June 30, 2018				December 31, 2017
	Recorded Investment		% of Total		Recorded Investment		% of Total
	(Dollars in millions)
Loan-to-value ratios:
Less than 65%	$	2,330	91.1	%	$	2,039	92.7	%
65% to 75%	227		8.9		161		7.3
Total	$	2,557	100.0	%	$	2,200	100.0	%

The estimated fair value of agricultural mortgage loans was $2.5 billion and $2.2 billion at June 30, 2018 and December 31, 2017, respectively.

Credit Quality of Residential Mortgage Loans

The credit quality of residential mortgage loans was as follows at:

	June 30, 2018				December 31, 2017
	Recorded Investment		% of Total		Recorded Investment		% of Total
	(Dollars in millions)
Performance indicators:
Performing	$	1,548	98.2	%	$	1,106	97.2	%
Nonperforming	29		1.8		32		2.8
Total	$	1,577	100.0	%	$	1,138	100.0	%

The estimated fair value of residential mortgage loans was$1.6 billionand$1.2 billionatJune 30, 2018andDecember 31, 2017, respectively.

Past Due, Nonaccrual and Modified Mortgage Loans

The Company has a high quality, well performing mortgage loan portfolio, with over 99% of all mortgage loans classified as performing at both June 30, 2018 and December 31, 2017. The Company defines delinquency consistent with industry practice, when mortgage loans are past due as follows: commercial and residential mortgage loans — 60 days and agricultural mortgage loans — 90 days. The Company had no commercial or agricultural mortgage loans past due and no commercial or agricultural mortgage loans in nonaccrual status at either June 30, 2018 or December 31, 2017. The recorded investment of residential mortgage loans past due and in nonaccrual status was $29 million and $32 million at June 30, 2018 and December 31, 2017, respectively. During the three months and six months ended June 30, 2018 and 2017, the Company did not have a significant amount of mortgage loans modified in a troubled debt restructuring.

Cash Equivalents

The carrying value of cash equivalents, which includes securities and other investments with an original or remaining maturity of three months or less at the time of purchase, was $1.1 billion and $1.0 billion at June 30, 2018 and December 31, 2017, respectively.

Net Unrealized Investment Gains (Losses)

Unrealized investment gains (losses) on fixed maturity and equity securities and the effect on DAC, VOBA, deferred sales inducements (“DSI”) and future policy benefits, that would result from the realization of the unrealized gains (losses), are included in net unrealized investment gains (losses) in AOCI.

The components of net unrealized investment gains (losses), included in AOCI, were as follows:

	June 30, 2018			December 31, 2017
	(In millions)
Fixed maturity securities	$	2,214		$	4,722
Fixed maturity securities with noncredit OTTI losses included in AOCI	6			2
Total fixed maturity securities	2,220			4,724
Equity securities	—			39
Derivatives	247			231
Other	(9		)	(8		)
Subtotal	2,458			4,986
Amounts allocated from:
Future policy benefits	(1,239		)	(2,370		)
DAC and VOBA related to noncredit OTTI losses recognized in AOCI	(5		)	(2		)
DAC, VOBA and DSI	(159		)	(260		)
Subtotal	(1,403		)	(2,632		)
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI	2			1
Deferred income tax benefit (expense)	(224		)	(495		)
Net unrealized investment gains (losses)	$	833		$	1,860

The changes in net unrealized investment gains (losses) were as follows:

	Six Months   Ended   June 30, 2018
	(In millions)
Balance, December 31, 2017	$	1,860
Unrealized investment gains (losses) change due to cumulative effect, net of income tax (1)	(79		)
Balance, January 1, 2018	1,781
Fixed maturity securities on which noncredit OTTI losses have been recognized	4
Unrealized investment gains (losses) during the period	(2,453		)
Unrealized investment gains (losses) relating to:
Future policy benefits	1,131
DAC and VOBA related to noncredit OTTI losses recognized in AOCI	(3		)
DAC, VOBA and DSI	101
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI	1
Deferred income tax benefit (expense)	271
Balance, June 30, 2018	$	833
Change in net unrealized investment gains (losses)	$	(948	)

__________________

(1) See Note 1 for more information related to the cumulative effect of change in accounting principle and other.

Concentrations of Credit Risk

There were no investments in any counterparty that were greater than 10% of the Company’s equity, other than the U.S. government and its agencies, at both June 30, 2018 and December 31, 2017.

Securities Lending

Elements of the securities lending program are presented below at:

	June 30, 2018		December 31, 2017
	(In millions)
Securities on loan: (1)
Amortized cost	$	3,304	$	3,085
Estimated fair value	$	3,798	$	3,748
Cash collateral received from counterparties (2)	$	3,834	$	3,791
Security collateral received from counterparties (3)	$	56	$	29
Reinvestment portfolio — estimated fair value	$	3,843	$	3,823

__________________

(1) Included within fixed maturity securities.

(2) Included within payables for collateral under securities loaned and other transactions.

(3) Security collateral received from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected on the consolidated financial statements.

The cash collateral liability by loaned security type and remaining tenor of the agreements were as follows at:

	June 30, 2018								December 31, 2017
	Remaining Tenor of Securities Lending Agreements								Remaining Tenor of Securities Lending Agreements
	Open (1)		1 Month or Less		1 to 6 Months		Total		Open (1)		1 Month or Less		1 to 6 Months		Total
	(In millions)
U.S. government and agency	$	1,345	$	1,596	$	893	$	3,834	$	1,626	$	964	$	1,201	$	3,791

__________________

(1) The related loaned security could be returned to the Company on the next business day which would require the Company to immediately return the cash collateral.

If the Company is required to return significant amounts of cash collateral on short notice and is forced to sell securities to meet the return obligation, it may have difficulty selling such collateral that is invested in securities in a timely manner, be forced to sell securities in a volatile or illiquid market for less than what otherwise would have been realized under normal market conditions, or both. The estimated fair value of the securities on loan related to the cash collateral on open at June 30, 2018 was $1.3 billion, all of which were U.S. government and agency securities which, if put back to the Company, could be immediately sold to satisfy the cash requirement.

The reinvestment portfolio acquired with the cash collateral consisted principally of fixed maturity securities (including agency RMBS, U.S. government and agency securities, ABS, U.S. and foreign corporate securities, and non-agency RMBS) with 64% invested in agency RMBS, U.S. government and agency securities, short-term investments, cash equivalents or held in cash at June 30, 2018. If the securities on loan or the reinvestment portfolio become less liquid, the Company has the liquidity resources of most of its general account available to meet any potential cash demands when securities on loan are put back to the Company.

Invested Assets on Deposit, Held in Trust and Pledged as Collateral

Invested assets on deposit, held in trust and pledged as collateral are presented below at estimated fair value at:

	June 30, 2018		December 31, 2017
	(In millions)
Invested assets on deposit (regulatory deposits) (1)	$	8,041	$	8,259
Invested assets held in trust (reinsurance agreements) (2)	2,985		2,634
Invested assets pledged as collateral (3)	3,823		3,199
Total invested assets on deposit, held in trust and pledged as collateral	$	14,849	$	14,092

__________________

(1) The Company has assets, primarily fixed maturity securities, on deposit with governmental authorities relating to certain policyholder liabilities, of which $70 million and $34 million of the assets on deposit balance represents restricted cash at June 30, 2018 and December 31, 2017, respectively.

(2) The Company has assets, primarily fixed maturity securities, held in trust relating to certain reinsurance transactions. $27 million and $42 million of the assets held in trust balance represents restricted cash at June 30, 2018 and December 31, 2017, respectively.

(3) The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements(seeNote 4of the Notes to the Consolidated Financial Statements included in the 2017 Annual Report) and derivative transactions (seeNote 5).

See “— Securities Lending” for information regarding securities on loan.

Variable Interest Entities

The Company has invested in legal entities that are VIEs. In certain instances, the Company holds both the power to direct the most significant activities of the entity, as well as an economic interest in the entity and, as such, is deemed to be the primary beneficiary or consolidator of the entity. The determination of the VIE’s primary beneficiary requires an evaluation of the contractual and implied rights and obligations associated with each party’s relationship with or involvement in the entity, an estimate of the entity’s expected losses and expected residual returns and the allocation of such estimates to each party involved in the entity.

Consolidated VIEs

Creditors or beneficial interest holders of VIEs where the Company is the primary beneficiary have no recourse to the general credit of the Company, as the Company’s obligation to the VIEs is limited to the amount of its committed investment.

The following table presents the total assets and total liabilities relating to VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated at:

	June 30, 2018		December 31, 2017
	(In millions)
CSEs: (1)
Assets
Mortgage loans (commercial mortgage loans)	$	96	$	115
Accrued investment income	—		1
Total assets	$	96	$	116
Liabilities
Long-term debt	$	5	$	11
Total liabilities	$	5	$	11

__________________

(1) The Company consolidates entities that are structured as CMBS. The assets of these entities can only be used to settle their respective liabilities, and under no circumstances is the Company liable for any principal or interest shortfalls should any arise. The Company’s exposure was limited to that of its remaining investment in these entities of $73 million and $86 million at estimated fair value at June 30, 2018 and December 31, 2017, respectively.

Unconsolidated VIEs

The carrying amount and maximum exposure to loss relating to VIEs in which the Company holds a significant variable interest but is not the primary beneficiary and which have not been consolidated were as follows at:

	June 30, 2018				December 31, 2017
	Carrying Amount		Maximum Exposure to Loss (1)		Carrying Amount		Maximum Exposure to Loss (1)
	(In millions)
Fixed maturity securities AFS:
Structured Securities (2)	$	11,084	$	11,084	$	11,136	$	11,136
U.S. and foreign corporate	437		437		501		501
Other limited partnership interests	1,549		2,772		1,509		2,460
Other investments (3)	78		81		71		79
Total	$	13,148	$	14,374	$	13,217	$	14,176

__________________

(1) The maximum exposure to loss relating to fixed maturity securities AFS is equal to their carrying amounts or the carrying amounts of retained interests. The maximum exposure to loss relating to other limited partnership interests and real estate joint ventures is equal to the carrying amounts plus any unfunded commitments. Such a maximum loss would be expected to occur only upon bankruptcy of the issuer or investee.

(2) For these variable interests, the Company’s involvement is limited to that of a passive investor in mortgage-backed or asset-backed securities issued by trusts that do not have substantial equity.

(3) Other investments is comprised of real estate joint ventures and other invested assets.

As described in Note 10, the Company makes commitments to fund partnership investments in the normal course of business. Excluding these commitments, the Company did not provide financial or other support to investees designated as VIEs during both the three months and six months ended June 30, 2018 and 2017.

Net Investment Income

The components of net investment income were as follows:

	Three Months Ended    June 30,				Six Months   Ended   June 30,
	2018		2017		2018		2017
	(In millions)
Investment income:
Fixed maturity securities	$	621	$	582	$	1,233	$	1,174
Equity securities	2		3		4		5
Mortgage loans	127		110		244		218
Policy loans	28		11		38		23
Real estate joint ventures	10		14		24		26
Other limited partnership interests	24		48		89		105
Cash, cash equivalents and short-term investments	5		9		10		17
Other	9		6		16		14
Subtotal	826		783		1,658		1,582
Less: Investment expenses	48		45		90		87
Subtotal, net	778		738		1,568		1,495
FVO CSEs — interest income — commercial mortgage loans	2		2		4		4
Net investment income	$	780	$	740	$	1,572	$	1,499

See “— Variable Interest Entities” for discussion of CSEs.

See “— Related Party Investment Transactions” for discussion of related party investment expenses.

Net Investment Gains (Losses)

Components of Net Investment Gains (Losses)

The components of net investment gains (losses) were as follows:

	Three Months Ended    June 30,						Six Months Ended     June 30,
	2018			2017			2018			2017
	(In millions)
Total gains (losses) on fixed maturity securities:
Total OTTI losses recognized — by sector:
State and political subdivision	$	—		$	(1	)	$	—		$	(1	)
OTTI losses on fixed maturity securities recognized in earnings	—			(1		)	—			(1		)
Fixed maturity securities — net gains (losses) on sales and disposals	(65		)	1			(103		)	(36		)
Total gains (losses) on fixed maturity securities	(65		)	—			(103		)	(37		)
Total gains (losses) on equity securities:
Equity securities — Mark to market and net gains (losses) on sales and disposals	(2		)	2			(3		)	1
Total gains (losses) on equity securities	(2		)	2			(3		)	1
Mortgage loans	(3		)	(2		)	(7		)	(5		)
Real estate joint ventures	—			1			42			3
Other limited partnership interests	—			—			—			(10		)
Other	1			—			1			(5		)
Subtotal	(69		)	1			(70		)	(53		)
FVO CSEs:
Commercial mortgage loans	(5		)	(1		)	(8		)	(1		)
Long-term debt — related to commercial mortgage loans	—			—			—			—
Non-investment portfolio gains (losses)	—			—			—			(1		)
Subtotal	(5		)	(1		)	(8		)	(2		)
Total net investment gains (losses)	$	(74	)	$	—		$	(78	)	$	(55	)

See “— Variable Interest Entities” for discussion of CSEs.

See “— Related Party Investment Transactions” for discussion of related party net investment gains (losses) related to transfers of invested assets.

Sales or Disposals and Impairments of Fixed Maturity Securities

Investment gains and losses on sales of securities are determined on a specific identification basis. Proceeds from sales or disposals of fixed maturity securities and the components of fixed maturity securities net investment gains (losses) were as shown in the table below.

	Three Months Ended    June 30,						Six Months Ended     June 30,
	2018			2017			2018			2017
	(In millions)
Proceeds	$	2,450		$	2,403		$	5,288		$	4,363
Gross investment gains	$	9		$	11		$	12		$	20
Gross investment losses	(74		)	(10		)	(115		)	(56		)
OTTI losses	—			(1		)	—			(1		)
Net investment gains (losses)	$	(65	)	$	—		$	(103	)	$	(37	)

Credit Loss Rollforward

The table below presents a rollforward of the cumulative credit loss component of OTTI loss recognized in earnings on fixed maturity securities still held for which a portion of the OTTI loss was recognized in other comprehensive income (“OCI”):

	Three Months Ended    June 30,					Six Months   Ended   June 30,
	2018		2017			2018		2017
	(In millions)
Balance, beginning of period	$	—	$	10		$	—	$	28
Reductions:
Sales (maturities, pay downs or prepayments) of securities previously impaired as credit loss OTTI	—		(1		)	—		(19		)
Balance, end of period	$	—	$	9		$	—	$	9

Related Party Investment Transactions

The Company previously transferred invested assets primarily consisting of fixed maturity securities to former affiliates, which were as follows:

	Three Months Ended    June 30,				Six Months   Ended   June 30,
	2018		2017		2018		2017
	(In millions)
Estimated fair value of invested assets transferred to former affiliates	$	—	$	—	$	—	$	292
Amortized cost of invested assets transferred to former affiliates	$	—	$	—	$	—	$	294
Net investment gains (losses) recognized on transfers	$	—	$	—	$	—	$	(2	)

At March 31, 2017, the Company had$1.1 billionof loans due from MetLife, Inc., which were included in other invested assets. These loans were carried at fixed interest rates of4.21%and5.10%, payable semiannually, and were due onSeptember 30, 2032andDecember 31, 2033, respectively. In April 2017, these loans were satisfied in a non-cash exchange for$1.1 billionof notes due to MetLife, Inc. SeeNotes 3 and 10of the Notes to the Consolidated Financial Statements included in the2017Annual Report.

In January 2017, Metropolitan Life Insurance Company (“MLIC”), a former affiliate, recaptured risks related to guaranteed minimum benefit guarantees on certain variable annuities being reinsured by the Company.The Company transferred invested assets and cash and cash equivalents which are included in the table above.See Note 11 for additional information related to these transfers.

In March 2017, the Company sold an operating joint venture with a book value of $89 million to MLIC for $286 million. The operating joint venture was accounted for under the equity method and included in other invested assets. This sale resulted in an increase in additional paid-in capital of $202 million in the first quarter of 2017.

The Company receives investment administrative services from MetLife Investment Advisors, LLC (“MLIA”), which was considered a related party investment manager until the completion of the MetLife Divestiture. The related investment administrative service charges were$26 millionand$49 millionfor thethree monthsandsix months endedJune 30, 2018, respectively, and $23 million and $48 millionfor thethree monthsandsix months endedJune 30, 2017, respectively. See Note 1 regarding the MetLife Divestiture.