The Company holds various types of fixed maturity securities available-for-sale and classifies them as corporate securities (“Corporate”), Canadian and Canadian provincial government securities (“Canadian government”), residential mortgage-backed securities (“RMBS”), asset-backed securities (“ABS”), commercial mortgage-backed securities (“CMBS”), U.S. government and agencies (“U.S. government”), state and political subdivisions, and other foreign government, supranational and foreign government-sponsored enterprises (“Other foreign government”). RMBS, ABS and CMBS are collectively “structured securities.”



March 31, 2020:	Amortized		Allowance for		Unrealized		Unrealized		Estimated Fair		% of
	Cost		Credit Losses		Gains		Losses		Value		Total
Available-for-sale:
Corporate	$	29,203	$	26	$	1,294	$	977	$	29,494	60.8	%
Canadian government	2,793		—		1,445		1		4,237		8.7
RMBS	2,241		—		77		27		2,291		4.7
ABS	2,940		—		4		277		2,667		5.5
CMBS	1,841		—		24		56		1,809		3.7
U.S. government	1,398		—		244		—		1,642		3.4
State and political subdivisions	1,071		—		108		10		1,169		2.4
Other foreign government	5,133		7		233		113		5,246		10.8
Total fixed maturity securities	$	46,620	$	33	$	3,429	$	1,461	$	48,555	100.0	%



December 31, 2019:	Amortized		Unrealized		Unrealized		Estimated Fair		% of		Impairments
	Cost		Gains		Losses		Value		Total		in AOCI
Available-for-sale:
Corporate	$	29,205	$	2,269	$	81	$	31,393	61.4	%	$	—
Canadian government	3,016		1,596		—		4,612		9.0		—
RMBS	2,339		62		3		2,398		4.7		—
ABS	2,973		19		14		2,978		5.8		—
CMBS	1,841		61		3		1,899		3.7		—
U.S. government	2,096		57		1		2,152		4.2		—
State and political subdivisions	1,074		93		3		1,164		2.3		—
Other foreign government	4,209		321		5		4,525		8.9		—
Total fixed maturity securities	$	46,753	$	4,478	$	110	$	51,121	100.0	%	$	—

The Company enters into various collateral arrangements with counterparties that require both the pledging and acceptance of fixed maturity securities as collateral. Pledged fixed maturity securities are included in fixed maturity securities available-for-sale in the condensed consolidated balance sheets. Fixed maturity securities received as collateral are held in separate custodial accounts and are not recorded on the Company’s condensed consolidated balance sheets. Subject to certain constraints, the Company is permitted by contract to sell or repledge collateral it receives; however, as of March 31, 2020 and December 31, 2019, none of the collateral received had been sold or repledged. The Company also holds assets in trust to satisfy collateral requirements under derivative transactions and certain third-party reinsurance treaties. The following table includes fixed maturity securities pledged and received as collateral and assets in trust held to satisfy collateral requirements under derivative transactions and certain third-party reinsurance treaties as of March 31, 2020 and December 31, 2019 (dollars in millions):



	March 31, 2020				December 31, 2019
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Fixed maturity securities pledged as collateral	$	142	$	154	$	113	$	116
Fixed maturity securities received as collateral	n/a		1,172		n/a		727
Assets in trust held to satisfy collateral requirements	27,080		27,441		27,290		29,239

The Company monitors its concentrations of financial instruments on an ongoing basis and mitigates credit risk by maintaining a diversified investment portfolio that limits exposure to any one issuer. The Company’s exposure to concentrations of credit risk from single issuers greater than 10% of the Company’s stockholders’ equity included securities of the U.S. government and its agencies, as well as the securities disclosed below, as of March 31, 2020 and December 31, 2019 (dollars in millions).



	March 31, 2020				December 31, 2019
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Fixed maturity securities guaranteed or issued by:
Government of Japan	$	1,660	$	1,672	$	813	$	852
Canadian province of Quebec	1,132		1,986		1,205		2,163
Canadian province of Ontario	941		1,289		1,014		1,379

The amortized cost and estimated fair value of fixed maturity securities classified as available-for-sale as of March 31, 2020, are shown by contractual maturity in the table below (dollars in millions). Actual maturities can differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Structured securities are shown separately in the table below, as they are not due at a single maturity date.



	Amortized Cost		Estimated Fair Value
Available-for-sale:
Due in one year or less	$	1,176	$	1,172
Due after one year through five years	8,125		8,184
Due after five years through ten years	9,629		9,880
Due after ten years	20,668		22,552
Structured securities	7,022		6,767
Total	$	46,620	$	48,555



March 31, 2020:			Estimated
	Amortized Cost		Fair Value		% of Total
Finance	$	10,979	$	11,056	37.5	%
Industrial	14,703		14,756		50.0
Utility	3,521		3,682		12.5
Total	$	29,203	$	29,494	100.0	%

December 31, 2019:			Estimated
	Amortized Cost		Fair Value		% of Total
Finance	$	10,896	$	11,653	37.2	%
Industrial	14,692		15,803		50.3
Utility	3,617		3,937		12.5
Total	$	29,205	$	31,393	100.0	%

As discussed in Note 1 – “Business and Basis of Presentation,” allowances for credit losses on fixed maturity securities are recognized in investment related gains (losses), net on the condensed consolidated statements of income. For these securities, the net amount recognized represents the difference between the amortized cost of the security and the net present value of its projected future cash flows discounted at the effective interest rate implicit in the fixed maturity security prior to the allowance for credit losses. Any remaining difference between the fair value and amortized cost is recognized in AOCI. The amount of pre-tax credit loss impairments on fixed maturity securities held by the Company, for which a portion of the impairment loss was recognized in AOCI, was $2 million and $4 million as of March 31, 2020 and March 31, 2019, respectively. There were no changes in these amounts from their respective prior-year ending balances.



	March 31, 2020				December 31, 2019
	Gross Unrealized Losses		% of Total		Gross Unrealized Losses		% of Total
Less than 20%	$	1,052	72.0	%	$	76	69.1	%
20% or more for less than six months	409		28.0		20		18.2
20% or more for six months or greater	—		—		14		12.7
Total	$	1,461	100.0	%	$	110	100.0	%

The Company’s determination of whether a decline in value necessitates the recording of an allowance for credit losses includes an analysis of whether the issuer is current on its contractual payments, evaluating whether it is probable that the Company will be able to collect all amounts due according to the contractual terms of the security and analyzing the overall ability of the Company to recover the amortized cost of the investment.

The following tables present the estimated fair values and gross unrealized losses for fixed maturity securities that have estimated fair values below amortized cost as of March 31, 2020 and December 31, 2019 (dollars in millions). These investments are presented by class and grade of security, as well as the length of time the related fair value has remained below amortized cost.



	Less than 12 months				12 months or greater				Total
			Gross				Gross				Gross
March 31, 2020:	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investment grade securities:
Corporate	$	9,666	$	729	$	93	$	18	$	9,759	$	747
Canadian government	—		—		6		1		6		1
RMBS	1,047		25		41		2		1,088		27
ABS	1,936		203		552		65		2,488		268
CMBS	913		52		21		1		934		53
U.S. government	—		—		—		—		—		—
State and political subdivisions	158		9		12		1		170		10
Other foreign government	1,813		94		7		4		1,820		98
Total investment grade securities	15,533		1,112		732		92		16,265		1,204
Below investment grade securities:
Corporate	1,106		219		66		11		$	1,172	$	230
ABS	15		9		—		—		15		9
CMBS	23		3		—		—		23		3
Other foreign government	150		13		7		2		157		15
Total below investment grade securities	1,294		244		73		13		1,367		257
Total fixed maturity securities	$	16,827	$	1,356	$	805	$	105	$	17,632	$	1,461



	Less than 12 months				12 months or greater				Total
			Gross				Gross				Gross
December 31, 2019:	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investment grade securities:
Corporate	$	1,936	$	29	$	293	$	7	$	2,229	$	36
Canadian government	—		—		—		—		—		—
RMBS	367		2		84		1		451		3
ABS	773		5		739		9		1,512		14
CMBS	253		3		—		—		253		3
U.S. government	49		1		—		—		49		1
State and political subdivisions	103		2		12		1		115		3
Other foreign government	278		4		—		—		278		4
Total investment grade securities	3,759		46		1,128		18		4,887		64
Below investment grade securities:
Corporate	220		38		100		7		320		45
ABS	—		—		—		—		—		—
CMBS	—		—		—		—		—		—
Other foreign government	—		—		10		1		10		1
Total below investment grade securities	220		38		110		8		330		46
Total fixed maturity securities	$	3,979	$	84	$	1,238	$	26	$	5,217	$	110

The Company has no intention to sell, nor does it expect to be required to sell, the securities outlined in the table above, as of the dates indicated. However, unforeseen facts and circumstances may cause the Company to sell fixed maturity securities in the ordinary course of managing its portfolio to meet certain diversification, credit quality and liquidity guidelines. Changes in unrealized losses are primarily driven by changes in interest rates.



	Three months ended March 31,
	2020			2019
Fixed maturity securities available-for-sale	$	480		$	415
Equity securities	2			1
Mortgage loans on real estate	67			60
Policy loans	15			14
Funds withheld at interest	53			62
Short-term investments and cash and cash equivalents	4			7
Other invested assets	(5		)	42
Investment income	616			601
Investment expense	(22		)	(21		)
Investment income, net of related expenses	$	594		$	580



	Three months ended March 31,
	2020			2019
Fixed maturity securities available-for-sale:
Impairment losses and change in allowance for credit losses	$	(34	)	$	(9	)
Gain on investment activity	27			28
Loss on investment activity	(8		)	(19		)
Net gains (losses) on equity securities	(23		)	4
Other impairment losses and change in mortgage loan provision	(13		)	(2		)
Derivatives and other, net	(234		)	6
Total investment related gains (losses), net	$	(285	)	$	8

The impairment losses and change in allowance for credit losses on fixed maturity securities for the three months ended March 31, 2020, includes $1 million in impairment losses on securities the Company intends to sell and an increase of $33 million in the allowance for credit losses related to high-yield securities as result of the uncertainty in the global markets due to the novel coronavirus (“COVID-19”) pandemic. The fixed maturity impairment losses for the three months ended March 31, 2019, were primarily related to a U.S. utility company. The fluctuations in investment related gains (losses) for equity securities for the three months ended March 31, 2020, was primarily driven by the change in unrealized gains/losses of these securities recognized in earnings due to the broad market weakness related to the COVID-19 pandemic. The other impairment losses and change in mortgage loan provision for the three months ended March 31, 2020, were primarily due to an increase in the mortgage loan valuation allowance to reflect the estimated impact from the COVID-19 pandemic. The fluctuations in investment related gains (losses) for derivatives and other for the three months ended March 31, 2020, compared to the same period in 2019, are primarily due to changes in the fair value of embedded derivatives related to modified coinsurance and funds withheld treaties, as a result of changes in interest rates, and widening credit spreads, both of which were a result of the COVID-19 pandemic uncertainty.



	March 31, 2020				December 31, 2019
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Borrowed securities	$	325	$	334	$	339	$	369
Securities lending:
Securities loaned	98		99		98		104
Securities received	n/a		107		n/a		107
Repurchase program/reverse repurchase program:
Securities pledged	398		408		356		384
Securities received	n/a		344		n/a		370

The following tables present information on the Company’s securities lending and repurchase/reverse repurchase transactions as of March 31, 2020 and December 31, 2019 (dollars in millions). Collateral associated with certain borrowed securities is not included within the tables, as the collateral pledged to each counterparty is the right to reinsurance treaty cash flows.



	March 31, 2020
	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 Days		30-90 Days		Greater than 90 Days		Total
Securities lending transactions:
Corporate	$	—	$	—	$	—	$	99	$	99
Total	—		—		—		99		99
Repurchase/reverse repurchase transactions:
Corporate	—		—		—		303		303
Other foreign government	—		—		—		105		105
Total	—		—		—		408		408
Total borrowings	$	—	$	—	$	—	$	507	$	507

Gross amount of recognized liabilities for securities lending and repurchase/reverse repurchase transactions in preceding table									$	451
Amounts related to agreements not included in offsetting disclosure									$	56



	December 31, 2019
	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 Days		30-90 Days		Greater than 90 Days		Total
Securities lending transactions:
Corporate	$	—	$	—	$	—	$	104	$	104
Total	—		—		—		104		104
Repurchase/reverse repurchase transactions:
Corporate	—		—		—		286		286
Other foreign government	—		—		—		98		98
Total	—		—		—		384		384
Total borrowings	$	—	$	—	$	—	$	488	$	488

Gross amount of recognized liabilities for securities lending and repurchase/reverse repurchase transactions in preceding table									$	478
Amounts related to agreements not included in offsetting disclosure									$	10

The Company has elected to offset amounts recognized as receivables and payables resulting from the repurchase/reverse repurchase programs. After the effect of offsetting, the net amount presented on the condensed consolidated balance sheets was a liability of $5 million and $1 million as of March 31, 2020 and December 31, 2019, respectively. As of March 31, 2020 and December 31, 2019, the Company recognized payables resulting from cash received as collateral associated with a repurchase/reverse repurchase agreement, as discussed above. Amounts owed to and due from the counterparties may be settled in cash or offset, in accordance with the agreements.

As of March 31, 2020, mortgage loans are geographically dispersed throughout the U.S. with the largest concentrations in California (15.2%), Texas (14.7%) and Washington (8.7%) and include loans secured by properties in Canada (2.9%) and United Kingdom (0.9%). The recorded investment in mortgage loans on real estate presented below is gross of unamortized deferred loan origination fees and expenses, and valuation allowances.



	March 31, 2020					December 31, 2019
Property type:	Carrying Value			% of Total		Carrying Value			% of Total
Office building	$	1,783		29.4	%	$	1,771		31.0	%
Retail	1,712			28.2		1,686			29.4
Industrial	1,253			20.7		1,169			20.4
Apartment	872			14.4		766			13.4
Other commercial	443			7.3		335			5.8
Recorded investment	$	6,063		100.0	%	$	5,727		100.0	%
Unamortized balance of loan origination fees and expenses	(10		)			(9		)
Valuation allowances	(39		)			(12		)
Total mortgage loans on real estate	$	6,014				$	5,706



	March 31, 2020				December 31, 2019
	Recorded Investment		% of Total		Recorded Investment		% of Total
Due within five years	$	2,011	33.2	%	$	1,841	32.2	%
Due after five years through ten years	3,107		51.2		2,944		51.4
Due after ten years	945		15.6		942		16.4
Total	$	6,063	100.0	%	$	5,727	100.0	%



	Recorded Investment
	Debt Service Ratios
	>1.20x		1.00x - 1.20x		<1.00x		Total		% of Total
March 31, 2020:
Loan-to-Value Ratio
0% - 59.99%	$	3,119	$	80	$	5	$	3,204	52.8	%
60% - 69.99%	2,015		40		—		2,055		33.9
70% - 79.99%	565		12		39		616		10.2
Greater than 80%	101		61		26		188		3.1
Total	$	5,800	$	193	$	70	$	6,063	100.0	%



	Recorded Investment
	Debt Service Ratios
	>1.20x		1.00x - 1.20x		<1.00x		Total		% of Total
December 31, 2019:
Loan-to-Value Ratio
0% - 59.99%	$	3,025	$	52	$	7	$	3,084	53.8	%
60% - 69.99%	1,841		53		11		1,905		33.3
70% - 79.99%	492		13		39		544		9.5
Greater than 80%	96		61		37		194		3.4
Total	$	5,454	$	179	$	94	$	5,727	100.0	%



	Recorded Investment
	Year of Origination
	2020		2019		2018		2017		2016		Prior		Total
March 31, 2020:
Internal credit quality grade:
High investment grade	$	302	$	675	$	623	$	403	$	603	$	1,177	$	3,783
Investment grade	236		516		317		342		269		422		2,102
Average	—		—		10		25		27		95		157
Watch list	—		—		—		—		—		4		4
In or near default	—		—		—		—		—		17		17
Total	$	538	$	1,191	$	950	$	770	$	899	$	1,715	$	6,063



	March 31, 2020		December 31, 2019
Mortgage loans:
Individually measured for impairment	$	17	$	17
Collectively measured for impairment	6,046		5,710
Recorded investment	$	6,063	$	5,727
Valuation allowances:
Individually measured for impairment	$	—	$	—
Collectively measured for impairment	39		12
Total valuation allowances	$	39	$	12



	Unpaid Principal Balance		Recorded Investment		Related Allowance		Carrying Value
March 31, 2020:
Impaired mortgage loans with no valuation allowance recorded	$	17	$	17	$	—	$	17
Impaired mortgage loans with valuation allowance recorded	—		—		—		—
Total impaired mortgage loans	$	17	$	17	$	—	$	17
December 31, 2019:
Impaired mortgage loans with no valuation allowance recorded	$	17	$	17	$	—	$	17
Impaired mortgage loans with valuation allowance recorded	—		—		—		—
Total impaired mortgage loans	$	17	$	17	$	—	$	17

The Company’s average investment balance of impaired mortgage loans and the related interest income are reflected in the table below for the periods indicated (dollars in millions):
	Three months ended March 31,
	2020				2019
	Average Recorded Investment⁽¹⁾		Interest Income		Average Recorded Investment⁽¹⁾		Interest Income
Impaired mortgage loans with no valuation allowance recorded	$	17	$	—	$	24	$	—
Impaired mortgage loans with valuation allowance recorded	—		—		—		—
Total impaired mortgage loans	$	17	$	—	$	24	$	—

The majority of policy loans are associated with one client. These policy loans present no credit risk as the amount of the loan cannot exceed the obligation due to the ceding company upon the death of the insured or surrender of the underlying policy. The provisions of the treaties in force and the underlying policies determine the policy loan interest rates. The Company earns a spread between the interest rate earned on policy loans and the interest rate credited to corresponding liabilities.

As of March 31, 2020, $3.2 billion of the funds withheld at interest balance is associated with one client. For reinsurance agreements written on a modco basis and certain agreements written on a coinsurance funds withheld basis, assets equal to the net statutory reserves are withheld and legally owned and managed by the ceding company and are reflected as funds withheld at interest on the Company’s condensed consolidated balance sheets. In the event of a ceding company’s insolvency, the Company would need to assert a claim on the assets supporting its reserve liabilities. However, the risk of loss to the Company is mitigated by its ability to offset amounts it owes the ceding company for claims or allowances against amounts owed to the Company from the ceding company.

Other invested assets include limited partnership interests, joint ventures (other than operating joint ventures), lifetime mortgages, derivative contracts and fair value option (“FVO”) contractholder-directed unit-linked investments. Other invested assets also includes FHLB common stock, which is included in Other in the table below. The allowance for credit losses for lifetime mortgages as of both March 31, 2020 and December 31, 2019, was $2 million. Carrying values of these assets as of March 31, 2020 and December 31, 2019 are as follows (dollars in millions):