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General (Tables)
 6 Months Ended
Jun. 30, 2019
General [Abstract]  
Lease, cost
Other information related to operating leases
 
 
As of June 30, 2019
Weighted average remaining lease term (years)
 
6

Weighted average discount rate
 
3.39
%
Operating lease, liability, maturity
Maturity of lease liabilities
($ in millions)
 
Operating leases
2019 (1)
 
$
50

2020
 
136

2021
 
107

2022
 
89

2023
 
74

2024
 
57

Thereafter
 
105

Total lease payments
 
$
618

Less: interest
 
(60
)
Present value of lease liabilities
 
$
558

(1) 
Excludes maturity of lease liabilities for the six months ended June 30, 2019.
Schedule changes in accounting principles
The impacts of the adjustments on the financial statements are summarized in the following tables.
Condensed Consolidated Statements of Operations (unaudited)
 
 
Previous accounting principle
 
Impact of change (1)
 
As reported
($ in millions, except per share data)
 
Three months ended June 30, 2019
Property and casualty insurance claims and claims expense
 
$
6,376

 
$
(20
)
 
$
6,356

Operating costs and expenses
 
1,401

 
(21
)
 
1,380

Pension and other postretirement remeasurement gains and losses
 
—

 
125

 
125

Restructuring and related charges
 
5

 
4

 
9

Total costs and expenses
 
9,980

 
88

 
10,068

Income from operations before income tax expense
 
1,166

 
(88
)
 
1,078

Income tax expense
 
246

 
(19
)
 
227

Net income
 
920

 
(69
)
 
851

Net income applicable to common shareholders
 
$
890

 
$
(69
)
 
$
821

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
2.68

 
$
(0.21
)
 
$
2.47

Net income applicable to common shareholders per common share - Diluted
 
$
2.64

 
$
(0.20
)
 
$
2.44

 
 
 
 
 
 
 
 
 
Six months ended June 30, 2019
Property and casualty insurance claims and claims expense
 
$
12,205

 
$
(29
)
 
$
12,176

Operating costs and expenses
 
2,789

 
(29
)
 
2,760

Pension and other postretirement remeasurement gains and losses
 
—

 
140

 
140

Restructuring and related charges
 
27

 
—

 
27

Total costs and expenses
 
19,357

 
82

 
19,439

Income from operations before income tax expense
 
2,780

 
(82
)
 
2,698

Income tax expense
 
573

 
(18
)
 
555

Net income
 
2,207

 
(64
)
 
2,143

Net income applicable to common shareholders
 
$
2,146

 
$
(64
)
 
$
2,082

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
6.46

 
$
(0.19
)
 
$
6.27

Net income applicable to common shareholders per common share - Diluted
 
$
6.36

 
$
(0.19
)
 
$
6.17

(1) The Company merged two of its pension plans, which had no impact on our financial statements as we remeasure pension plan assets and projected benefit obligations immediately in earnings on a quarterly basis.  However, the plan merger increased the impact of change by $18 million for both the second quarter and first six months of 2019, reflecting the shorter amortization period for losses deferred in AOCI from one of the merged plans that was required as part of the merger. 



Condensed Consolidated Statements of Operations (unaudited)
 
 
Previously reported
 
Impact of change
 
As adjusted
($ in millions, except per share data)
 
Three months ended June 30, 2018
Property and casualty insurance claims and claims expense
 
$
5,792

 
$
(15
)
 
$
5,777

Operating costs and expenses
 
1,384

 
(26
)
 
1,358

Pension and other postretirement remeasurement gains and losses
 
—

 
(7
)
 
(7
)
Restructuring and related charges
 
27

 
(4
)
 
23

Total costs and expenses
 
9,256

 
(52
)
 
9,204

Income from operations before income tax expense
 
845

 
52

 
897

Income tax expense
 
169

 
11

 
180

Net income
 
676

 
41

 
717

Net income applicable to common shareholders
 
$
637

 
$
41

 
$
678

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
1.82

 
$
0.12

 
$
1.94

Net income applicable to common shareholders per common share - Diluted
 
$
1.80

 
$
0.11

 
$
1.91

 
 
 
 
 
 
 
 
 
Six months ended June 30, 2018
Property and casualty insurance claims and claims expense
 
$
10,941

 
$
(35
)
 
$
10,906

Operating costs and expenses
 
2,717

 
(56
)
 
2,661

Pension and other postretirement remeasurement gains and losses
 
—

 
7

 
7

Restructuring and related charges
 
49

 
(7
)
 
42

Total costs and expenses
 
17,803

 
(91
)
 
17,712

Income from operations before income tax expense
 
2,069

 
91

 
2,160

Income tax expense
 
418

 
19

 
437

Net income
 
1,651

 
72

 
1,723

Net income applicable to common shareholders
 
$
1,583

 
$
72

 
$
1,655

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
4.50

 
$
0.21

 
$
4.71

Net income applicable to common shareholders per common share - Diluted
 
$
4.43


$
0.20

 
$
4.63

Condensed Consolidated Statements of Comprehensive Income (unaudited)
 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
Three months ended June 30, 2019
Net income
 
$
920

 
$
(69
)
 
$
851

Other comprehensive income (loss), after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
682

 
—

 
682

Unrealized foreign currency translation adjustments
 
7

 
(3
)
 
4

Unrecognized pension and other postretirement benefit cost (1)
 
125

 
(136
)
 
(11
)
Other comprehensive income (loss), after-tax
 
814

 
(139
)
 
675

Comprehensive income
 
$
1,734

 
$
(208
)
 
$
1,526

 
 
 
 
 
 
 
 
 
Six months ended June 30, 2019
Net income
 
$
2,207

 
$
(64
)
 
$
2,143

Other comprehensive income (loss), after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
1,656

 
—

 
1,656

Unrealized foreign currency translation adjustments
 
14

 
(5
)
 
9

Unrecognized pension and other postretirement benefit cost (1)
 
135

 
(158
)
 
(23
)
Other comprehensive income (loss), after-tax
 
1,805

 
(163
)
 
1,642

Comprehensive income
 
$
4,012

 
$
(227
)
 
$
3,785

(1) Financial statement line item has been updated to “Unamortized pension and other postretirement prior service credit”.
Condensed Consolidated Statements of Comprehensive Income (unaudited)
 
 
Previously reported
 
Impact of change
 
As adjusted
($ in millions)
 
Three months ended June 30, 2018
Net income
 
$
676

 
$
41

 
$
717

Other comprehensive loss, after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
(133
)
 
—

 
(133
)
Unrealized foreign currency translation adjustments
 
(7
)
 
1

 
(6
)
Unrecognized pension and other postretirement benefit cost 
 
22

 
(38
)
 
(16
)
Other comprehensive loss, after-tax
 
(118
)
 
(37
)
 
(155
)
Comprehensive income
 
$
558

 
$
4

 
$
562

 
 
 
 
 
 
 
 
 
Six months ended June 30, 2018
Net income
 
$
1,651

 
$
72

 
$
1,723

Other comprehensive loss, after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
(698
)
 
—

 
(698
)
Unrealized foreign currency translation adjustments
 
(11
)
 
3

 
(8
)
Unrecognized pension and other postretirement benefit cost
 
45

 
(75
)
 
(30
)
Other comprehensive loss, after-tax
 
(664
)
 
(72
)
 
(736
)
Comprehensive income
 
$
987

 
$
—

 
$
987

Condensed Consolidated Statements of Financial Position (unaudited)
 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
June 30, 2019
Deferred income taxes
 
$
1,057

 
$
(60
)
 
$
997

Other liabilities and accrued expenses
 
8,855

 
287

 
9,142

Total liabilities
 
93,671

 
227

 
93,898

Retained income
 
47,542

 
(1,739
)
 
45,803

Unrealized foreign currency translation adjustments
 
(50
)
 
10

 
(40
)
Unrecognized pension and other postretirement benefit cost 
 
(1,356
)
 
1,502

 
146

Total AOCI
 
248

 
1,512

 
1,760

Total shareholders’ equity
 
$
24,703

 
$
(227
)
 
$
24,476

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Previously reported
 
Impact of change
 
As adjusted
($ in millions)
 
December 31, 2018
Retained income
 
$
45,708

 
$
(1,675
)
 
$
44,033

Unrealized foreign currency translation adjustments
 
(64
)
 
15

 
(49
)
Unrecognized pension and other postretirement benefit cost 
 
(1,491
)
 
1,660

 
169

Total AOCI
 
$
(1,557
)
 
$
1,675

 
$
118

Condensed Consolidated Statements of Shareholders’ Equity (unaudited)

 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
Three months ended June 30, 2019
Retained income
 
 
 
 
 
 
Balance, beginning of period
 
$
46,818

 
$
(1,670
)
 
$
45,148

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Net income
 
920

 
(69
)
 
851

Dividends on common stock
 
(166
)
 
—

 
(166
)
Dividends on preferred stock
 
(30
)
 
—

 
(30
)
Balance, end of period
 
47,542

 
(1,739
)
 
45,803

 
 
 
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
 
 
 
 
Balance, beginning of period
 
(566
)
 
1,651

 
1,085

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Change in unrealized net capital gains and losses
 
682

 
—

 
682

Change in unrealized foreign currency translation adjustments
 
7

 
(3
)
 
4

Change in unrecognized pension and other postretirement benefit cost (1)
 
125

 
(136
)
 
(11
)
Balance, end of period
 
248

 
1,512

 
1,760

Total shareholders’ equity
 
$
24,703

 
$
(227
)
 
$
24,476

 
 
 
 
 
 
 
 
 
Six months ended June 30, 2019
Retained income
 
 
 
 
 
 
Balance, beginning of period
 
$
45,708

 
$
(1,675
)
 
$
44,033

Cumulative effect of change in accounting principle
 
21

 
—

 
21

Net income
 
2,207

 
(64
)
 
2,143

Dividends on common stock
 
(333
)
 
—

 
(333
)
Dividends on preferred stock
 
(61
)
 
—

 
(61
)
Balance, end of period
 
47,542

 
(1,739
)
 
45,803

 
 
 
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
 
 
 
 
Balance, beginning of period
 
(1,557
)
 
1,675

 
118

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Change in unrealized net capital gains and losses
 
1,656

 
—

 
1,656

Change in unrealized foreign currency translation adjustments
 
14

 
(5
)
 
9

Change in unrecognized pension and other postretirement benefit cost (1)
 
135

 
(158
)
 
(23
)
Balance, end of period
 
248

 
1,512

 
1,760

Total shareholders’ equity
 
$
24,703

 
$
(227
)
 
$
24,476

(1) Financial statement line item has been updated to “Change in unamortized pension and other postretirement prior service credit”.
Condensed Consolidated Statements of Shareholders’ Equity (unaudited)

 
 
Previously reported
 
Impact of change
 
As adjusted
($ in millions)
 
Three months ended June 30, 2018
Retained income
 
 
 
 
 
 
Balance, beginning of period
 
$
45,031

 
$
(1,552
)
 
$
43,479

Net income
 
676

 
41

 
717

Dividends on common stock
 
(160
)
 
—

 
(160
)
Dividends on preferred stock
 
(39
)
 
—

 
(39
)
Balance, end of period
 
45,508

 
(1,511
)
 
43,997

 
 
 
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
 
 
 
 
Balance, beginning of period
 
(1,150
)
 
1,548

 
398

Change in unrealized net capital gains and losses
 
(133
)
 
—

 
(133
)
Change in unrealized foreign currency translation adjustments
 
(7
)
 
1

 
(6
)
Change in unrecognized pension and other postretirement benefit cost
 
22

 
(38
)
 
(16
)
Balance, end of period
 
(1,268
)
 
1,511

 
243

Total shareholders’ equity
 
$
23,122

 
$
—

 
$
23,122

 
 
 
 
 
 
 
 
 
Six months ended June 30, 2018
Retained income
 
 
 
 
 
 
Balance, beginning of period
 
$
43,162

 
$
(1,583
)
 
$
41,579

Cumulative effect of change in accounting principle
 
1,088

 
—

 
1,088

Net income
 
1,651

 
72

 
1,723

Dividends on common stock
 
(325
)
 
—

 
(325
)
Dividends on preferred stock
 
(68
)
 
—

 
(68
)
Balance, end of period
 
45,508

 
(1,511
)
 
43,997

 
 
 
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
 
 
 
 
Balance, beginning of period
 
306

 
1,583

 
1,889

Cumulative effect of change in accounting principle
 
(910
)
 
—

 
(910
)
Change in unrealized net capital gains and losses
 
(698
)
 
—

 
(698
)
Change in unrealized foreign currency translation adjustments
 
(11
)
 
3

 
(8
)
Change in unrecognized pension and other postretirement benefit cost
 
45

 
(75
)
 
(30
)
Balance, end of period
 
(1,268
)
 
1,511

 
243

Total shareholders’ equity
 
$
23,122

 
$
—

 
$
23,122

Condensed Consolidated Statements of Cash Flows (unaudited)
 
 
 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
Six months ended June 30, 2019
Cash flows from operating activities
 
 
 
 
 
 
Net income
 
$
2,207

 
$
(64
)
 
$
2,143

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
 
 
Pension and other postretirement remeasurement gains and losses
 
—

 
140

 
140

Income taxes
 
177

 
(18
)
 
159

Other operating assets and liabilities
 
(447
)
 
(58
)
 
(505
)
Net cash provided by operating activities
 
$
2,062

 
$
—

 
$
2,062

 
 
 
 
 
 
 
Condensed Consolidated Statements of Cash Flows (unaudited)
 
 
 
 
 
 
 
 
Previously reported
 
Impact of change
 
As adjusted
($ in millions)
 
Six months ended June 30, 2018
Cash flows from operating activities
 
 
 
 
 
 
Net income
 
$
1,651

 
$
72

 
$
1,723

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
 
 
Pension and other postretirement remeasurement gains and losses
 
—

 
7

 
7

Income taxes
 
(257
)
 
19

 
(238
)
Other operating assets and liabilities
 
51

 
(98
)
 
(47
)
Net cash provided by operating activities
 
$
2,090

 
$
—

 
$
2,090