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

Weighted average discount rate
 
3.32
%

Operating lease, liability, maturity
Maturity of lease liabilities
($ in millions)
 
Operating leases
2019 (1)
 
$
12

2020
 
141

2021
 
111

2022
 
91

2023
 
76

2024
 
59

Thereafter
 
108

Total lease payments
 
$
598

Less: interest
 
(56
)
Present value of lease liabilities
 
$
542

(1) 
Excludes maturity of lease liabilities for the nine months ended September 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 September 30, 2019
Property and casualty insurance claims and claims expense
 
$
6,080

 
$
(29
)
 
$
6,051

Operating costs and expenses
 
1,433

 
(19
)
 
1,414

Pension and other postretirement remeasurement gains and losses
 
—

 
225

 
225

Restructuring and related charges
 
—

 
—

 
—

Total costs and expenses
 
9,732

 
177

 
9,909

Income from operations before income tax expense
 
1,337

 
(177
)
 
1,160

Income tax expense
 
266

 
(37
)
 
229

Net income
 
1,071

 
(140
)
 
931

Net income applicable to common shareholders
 
$
1,029

 
$
(140
)
 
$
889

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
3.14

 
$
(0.43
)
 
$
2.71

Net income applicable to common shareholders per common share - Diluted
 
$
3.09

 
$
(0.42
)
 
$
2.67

 
 
 
 
 
 
 
 
 
Nine months ended September 30, 2019
Property and casualty insurance claims and claims expense
 
$
18,285

 
$
(58
)
 
$
18,227

Operating costs and expenses
 
4,222

 
(48
)
 
4,174

Pension and other postretirement remeasurement gains and losses
 
—

 
365

 
365

Restructuring and related charges
 
27

 
—

 
27

Total costs and expenses
 
29,089

 
259

 
29,348

Income from operations before income tax expense
 
4,117

 
(259
)
 
3,858

Income tax expense
 
839

 
(55
)
 
784

Net income
 
3,278

 
(204
)
 
3,074

Net income applicable to common shareholders
 
$
3,175

 
$
(204
)
 
$
2,971

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
9.60

 
$
(0.62
)
 
$
8.98

Net income applicable to common shareholders per common share - Diluted
 
$
9.46

 
$
(0.61
)
 
$
8.85

(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 $12 million and $18 million for the third quarter and first nine months of 2019, respectively, 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 September 30, 2018
Property and casualty insurance claims and claims expense
 
$
5,817

 
$
(12
)
 
$
5,805

Operating costs and expenses
 
1,510

 
(85
)
 
1,425

Pension and other postretirement remeasurement gains and losses
 
—

 
(39
)
 
(39
)
Restructuring and related charges
 
16

 
(3
)
 
13

Total costs and expenses
 
9,427

 
(139
)
 
9,288

Income from operations before income tax expense
 
1,039

 
139

 
1,178

Income tax expense
 
169

 
30

 
199

Net income
 
870

 
109

 
979

Net income applicable to common shareholders
 
$
833

 
$
109

 
$
942

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
2.41

 
$
0.31

 
$
2.72

Net income applicable to common shareholders per common share - Diluted
 
$
2.37

 
$
0.31

 
$
2.68

 
 
 
 
 
 
 
 
 
Nine months ended September 30, 2018
Property and casualty insurance claims and claims expense
 
$
16,758

 
$
(47
)
 
$
16,711

Operating costs and expenses
 
4,227

 
(141
)
 
4,086

Pension and other postretirement remeasurement gains and losses
 
—

 
(32
)
 
(32
)
Restructuring and related charges
 
65

 
(10
)
 
55

Total costs and expenses
 
27,230

 
(230
)
 
27,000

Income from operations before income tax expense
 
3,108

 
230

 
3,338

Income tax expense
 
587

 
49

 
636

Net income
 
2,521

 
181

 
2,702

Net income applicable to common shareholders
 
$
2,416

 
$
181

 
$
2,597

 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
Net income applicable to common shareholders per common share - Basic
 
$
6.91

 
$
0.52

 
$
7.43

Net income applicable to common shareholders per common share - Diluted
 
$
6.80


$
0.51

 
$
7.31

Condensed Consolidated Statements of Comprehensive Income (unaudited)
 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
Three months ended September 30, 2019
Net income
 
$
1,071

 
$
(140
)
 
$
931

Other comprehensive income (loss), after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
369

 
—

 
369

Unrealized foreign currency translation adjustments
 
(12
)
 
2

 
(10
)
Unrecognized pension and other postretirement benefit cost (1)
 
20

 
(32
)
 
(12
)
Other comprehensive income, after-tax
 
377

 
(30
)
 
347

Comprehensive income
 
$
1,448

 
$
(170
)
 
$
1,278

 
 
 
 
 
 
 
 
 
Nine months ended September 30, 2019
Net income
 
$
3,278

 
$
(204
)
 
$
3,074

Other comprehensive income (loss), after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
2,025

 
—

 
2,025

Unrealized foreign currency translation adjustments
 
2

 
(3
)
 
(1
)
Unrecognized pension and other postretirement benefit cost (1)
 
155

 
(190
)
 
(35
)
Other comprehensive income, after-tax
 
2,182

 
(193
)
 
1,989

Comprehensive income
 
$
5,460

 
$
(397
)
 
$
5,063

(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 September 30, 2018
Net income
 
$
870

 
$
109

 
$
979

Other comprehensive income (loss), after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
(70
)
 
—

 
(70
)
Unrealized foreign currency translation adjustments
 
(14
)
 
—

 
(14
)
Unrecognized pension and other postretirement benefit cost 
 
68

 
(83
)
 
(15
)
Other comprehensive loss, after-tax
 
(16
)
 
(83
)
 
(99
)
Comprehensive income
 
$
854

 
$
26

 
$
880

 
 
 
 
 
 
 
 
 
Nine months ended September 30, 2018
Net income
 
$
2,521

 
$
181

 
$
2,702

Other comprehensive income (loss), after-tax
 
 
 
 
 
 
Changes in:
 
 
 
 
 
 
Unrealized net capital gains and losses
 
(768
)
 
—

 
(768
)
Unrealized foreign currency translation adjustments
 
(25
)
 
3

 
(22
)
Unrecognized pension and other postretirement benefit cost
 
113

 
(158
)
 
(45
)
Other comprehensive loss, after-tax
 
(680
)
 
(155
)
 
(835
)
Comprehensive income
 
$
1,841

 
$
26

 
$
1,867

Condensed Consolidated Statements of Financial Position (unaudited)
 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
September 30, 2019
Deferred income taxes
 
$
1,185

 
$
(106
)
 
$
1,079

Other liabilities and accrued expenses
 
9,226

 
503

 
9,729

Total liabilities
 
94,536

 
397

 
94,933

Retained income
 
48,406

 
(1,879
)
 
46,527

Unrealized foreign currency translation adjustments
 
(62
)
 
12

 
(50
)
Unrecognized pension and other postretirement benefit cost 
 
(1,336
)
 
1,470

 
134

Total AOCI
 
625

 
1,482

 
2,107

Total shareholders’ equity
 
$
26,537

 
$
(397
)
 
$
26,140

 
 
 
 
 
 
 
 
 
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 September 30, 2019
Retained income
 
 
 
 
 
 
Balance, beginning of period
 
$
47,542

 
$
(1,739
)
 
$
45,803

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Net income
 
1,071

 
(140
)
 
931

Dividends on common stock
 
(165
)
 
—

 
(165
)
Dividends on preferred stock
 
(42
)
 
—

 
(42
)
Balance, end of period
 
48,406

 
(1,879
)
 
46,527

 
 
 
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
 
 
 
 
Balance, beginning of period
 
248

 
1,512

 
1,760

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Change in unrealized net capital gains and losses
 
369

 
—

 
369

Change in unrealized foreign currency translation adjustments
 
(12
)
 
2

 
(10
)
Change in unrecognized pension and other postretirement benefit cost (1)
 
20

 
(32
)
 
(12
)
Balance, end of period
 
625

 
1,482

 
2,107

Total shareholders’ equity
 
$
26,537

 
$
(397
)
 
$
26,140

 
 
 
 
 
 
 
 
 
Nine months ended September 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
 
3,278

 
(204
)
 
3,074

Dividends on common stock
 
(498
)
 
—

 
(498
)
Dividends on preferred stock
 
(103
)
 
—

 
(103
)
Balance, end of period
 
48,406

 
(1,879
)
 
46,527

 
 
 
 
 
 
 
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
 
2,025

 
—

 
2,025

Change in unrealized foreign currency translation adjustments
 
2

 
(3
)
 
(1
)
Change in unrecognized pension and other postretirement benefit cost (1)
 
155

 
(190
)
 
(35
)
Balance, end of period
 
625

 
1,482

 
2,107

Total shareholders’ equity
 
$
26,537

 
$
(397
)
 
$
26,140

(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 September 30, 2018
Retained income
 
 
 
 
 
 
Balance, beginning of period
 
$
45,508

 
$
(1,511
)
 
$
43,997

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Net income
 
870

 
109

 
979

Dividends on common stock
 
(163
)
 
—

 
(163
)
Dividends on preferred stock
 
(37
)
 
—

 
(37
)
Balance, end of period
 
46,178

 
(1,402
)
 
44,776

 
 
 
 
 
 
 
Accumulated other comprehensive income (loss)
 
 
 
 
 
 
Balance, beginning of period
 
(1,268
)
 
1,511

 
243

Cumulative effect of change in accounting principle
 
—

 
—

 
—

Change in unrealized net capital gains and losses
 
(70
)
 
—

 
(70
)
Change in unrealized foreign currency translation adjustments
 
(14
)
 
—

 
(14
)
Change in unrecognized pension and other postretirement benefit cost
 
68

 
(83
)
 
(15
)
Balance, end of period
 
(1,284
)
 
1,428

 
144

Total shareholders’ equity
 
$
23,633

 
$
26

 
$
23,659

 
 
 
 
 
 
 
 
 
Nine months ended September 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
 
2,521

 
181

 
2,702

Dividends on common stock
 
(488
)
 
—

 
(488
)
Dividends on preferred stock
 
(105
)
 
—

 
(105
)
Balance, end of period
 
46,178

 
(1,402
)
 
44,776

 
 
 
 
 
 
 
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
 
(768
)
 
—

 
(768
)
Change in unrealized foreign currency translation adjustments
 
(25
)
 
3

 
(22
)
Change in unrecognized pension and other postretirement benefit cost
 
113

 
(158
)
 
(45
)
Balance, end of period
 
(1,284
)
 
1,428

 
144

Total shareholders’ equity
 
$
23,633

 
$
26

 
$
23,659

Condensed Consolidated Statements of Cash Flows (unaudited)
 
 
 
 
Previous accounting principle
 
Impact of change
 
As reported
($ in millions)
 
Nine months ended September 30, 2019
Cash flows from operating activities
 
 
 
 
 
 
Net income
 
$
3,278

 
$
(204
)
 
$
3,074

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 

 
 
Pension and other postretirement remeasurement gains and losses
 
—

 
365

 
365

Income taxes
 
309

 
(55
)
 
254

Other operating assets and liabilities
 
(75
)
 
(106
)
 
(181
)
Net cash provided by operating activities
 
$
3,895

 
$
—

 
$
3,895

 
 
 
 
 
 
 
 
 
Previously reported
 
Impact of change
 
As adjusted
($ in millions)
 
Nine months ended September 30, 2018
Cash flows from operating activities
 
 
 
 
 
 
Net income
 
$
2,521

 
$
181

 
$
2,702

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

 
(32
)
 
(32
)
Income taxes
 
(227
)
 
49

 
(178
)
Other operating assets and liabilities
 
533

 
(198
)
 
335

Net cash provided by operating activities
 
$
3,818

 
$
—

 
$
3,818