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Derivatives (Tables)
 12 Months Ended
Dec. 31, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location
The following table presents the gross notional amount, estimated fair value and primary underlying risk exposure of the Company’s derivatives, excluding embedded derivatives, held at:
 
Primary Underlying Risk Exposure
 
December 31,
 
2014
 
2013
 
 
 
Estimated Fair Value
 
 
 
Estimated Fair Value
 
Gross
Notional
Amount
 
Assets
 
Liabilities
 
Gross
Notional
Amount
 
Assets
 
Liabilities
 
 
 
(In millions)
Derivatives Designated as Hedging Instruments
 
 
 
 
 
 
 
 
 
 
 
 
Fair value hedges:
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate swaps
Interest rate
 
$
5,632

 
$
2,031

 
$
18

 
$
5,940

 
$
1,277

 
$
68

Foreign currency swaps
Foreign currency exchange rate
 
2,709

 
65

 
101

 
2,591

 
252

 
122

Subtotal
 
8,341

 
2,096

 
119

 
8,531

 
1,529

 
190

Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate swaps
Interest rate
 
2,191

 
447

 
—

 
2,584

 
77

 
109

Interest rate forwards
Interest rate
 
70

 
18

 
—

 
205

 
3

 
3

Foreign currency swaps
Foreign currency exchange rate
 
14,895

 
501

 
614

 
10,560

 
374

 
500

Subtotal
 
17,156

 
966

 
614

 
13,349

 
454

 
612

Total qualifying hedges
 
25,497

 
3,062

 
733

 
21,880

 
1,983

 
802

Derivatives Not Designated or Not Qualifying as Hedging Instruments
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate swaps
Interest rate
 
56,394

 
2,213

 
1,072

 
59,022

 
1,320

 
732

Interest rate floors
Interest rate
 
36,141

 
319

 
108

 
38,220

 
323

 
234

Interest rate caps
Interest rate
 
41,227

 
134

 
1

 
29,809

 
141

 
—

Interest rate futures
Interest rate
 
70

 
—

 
—

 
105

 
—

 
—

Interest rate options
Interest rate
 
6,399

 
379

 
15

 
4,849

 
120

 
8

Synthetic GICs
Interest rate
 
4,298

 
—

 
—

 
4,409

 
—

 
—

Foreign currency swaps
Foreign currency exchange rate
 
8,774

 
359

 
176

 
7,267

 
79

 
492

Foreign currency forwards
Foreign currency exchange rate
 
3,985

 
92

 
80

 
4,261

 
44

 
32

Credit default swaps — purchased
Credit
 
857

 
8

 
11

 
1,506

 
7

 
21

Credit default swaps — written
Credit
 
7,419

 
130

 
5

 
6,600

 
124

 
1

Equity futures
Equity market
 
954

 
10

 
—

 
—

 
—

 
—

Equity index options
Equity market
 
7,698

 
328

 
352

 
1,147

 
—

 
—

Equity variance swaps
Equity market
 
5,678

 
60

 
146

 
—

 
—

 
—

TRRs
Equity market
 
911

 
10

 
33

 
—

 
—

 
—

Total non-designated or non-qualifying derivatives
 
180,805

 
4,042

 
1,999

 
157,195

 
2,158

 
1,520

Total
 
$
206,302

 
$
7,104

 
$
2,732

 
$
179,075

 
$
4,141

 
$
2,322
Components of Net Derivatives Gains (Losses)
The components of net derivative gains (losses) were as follows:
 
Years Ended December 31,
 
2014
 
2013
 
2012
 
(In millions)
Derivatives and hedging gains (losses) (1)
$
1,207

 
$
(1,205
)
 
$
77

Embedded derivatives
(170
)
 
135

 
598

Total net derivative gains (losses)
$
1,037

 
$
(1,070
)
 
$
675

______________
(1)
Includes foreign currency transaction gains (losses) on hedged items in cash flow and non-qualifying hedging relationships, which are not presented elsewhere in this note.
Earned Income On Derivatives And Income Statement Location
The following table presents earned income on derivatives:
 
Years Ended December 31,
 
2014
 
2013
 
2012
 
(In millions)
Qualifying hedges:
 
 
 
 
 
Net investment income
$
162

 
$
129

 
$
108

Interest credited to policyholder account balances
106

 
148

 
146

Non-qualifying hedges:
 
 
 
 
 
Net investment income
(4
)
 
(6
)
 
(6
)
Net derivative gains (losses)
484

 
450

 
314

Policyholder benefits and claims
8

 
—

 
—

Total
$
756

 
$
721

 
$
562
Amount and location of gains (losses) recognized in income for derivatives that are not designated or qualifying as hedging instruments
The following table presents the amount and location of gains (losses) recognized in income for derivatives that were not designated or qualifying as hedging instruments:
 
Net
Derivative
Gains (Losses)
 
Net
Investment
Income (1)
 
Policyholder
Benefits and
Claims (2)
 
(In millions)
Year Ended December 31, 2014
 
 
 
 
 
Interest rate derivatives
$
314

 
$
—

 
$
—

Foreign currency exchange rate derivatives
554

 
—

 
—

Credit derivatives — purchased
(2
)
 
—

 
—

Credit derivatives — written
(1
)
 
—

 
—

Equity derivatives
11

 
(10
)
 
(10
)
Total
$
876

 
$
(10
)
 
$
(10
)
Year Ended December 31, 2013
 
 
 
 
 
Interest rate derivatives
$
(1,753
)
 
$
—

 
$
—

Foreign currency exchange rate derivatives
(69
)
 
—

 
—

Credit derivatives — purchased
(6
)
 
(14
)
 
—

Credit derivatives — written
100

 
1

 
—

Equity derivatives
—

 
(22
)
 
—

Total
$
(1,728
)
 
$
(35
)
 
$
—

Year Ended December 31, 2012
 
 
 
 
 
Interest rate derivatives
$
(83
)
 
$
—

 
$
—

Foreign currency exchange rate derivatives
(252
)
 
—

 
—

Credit derivatives — purchased
(72
)
 
(15
)
 
—

Credit derivatives — written
105

 
—

 
—

Equity derivatives
—

 
(12
)
 
—

Total
$
(302
)
 
$
(27
)
 
$
—

______________
(1)
Changes in estimated fair value related to economic hedges of equity method investments in joint ventures and derivatives held in relation to trading portfolios.
(2)
Changes in estimated fair value related to economic hedges of variable annuity guarantees included in future policy benefits.
Net derivatives gains (losses) recognized on fair value derivatives and the related hedged items
The Company recognizes gains and losses on derivatives and the related hedged items in fair value hedges within net derivative gains (losses). The following table presents the amount of such net derivative gains (losses):
Derivatives in Fair Value
Hedging Relationships
 
Hedged Items in Fair Value
Hedging Relationships
 
Net Derivative Gains (Losses) Recognized for Derivatives
 
Net Derivative Gains (Losses) Recognized for Hedged Items
 
Ineffectiveness Recognized in Net Derivative Gains (Losses)
 
 
 
 
(In millions)
Year Ended December 31, 2014
 
 
 
 
 
 
Interest rate swaps:
 
Fixed maturity securities
 
$
4

 
$
(1
)
 
$
3

 
 
Policyholder liabilities (1)
 
649

 
(635
)
 
14

Foreign currency swaps:
 
Foreign-denominated fixed maturity securities
 
13

 
(11
)
 
2

 
 
Foreign-denominated PABs (2)
 
(283
)
 
270

 
(13
)
Total
 
$
383

 
$
(377
)
 
$
6

Year Ended December 31, 2013
 
 
 
 
 
 
Interest rate swaps:
 
Fixed maturity securities
 
$
34

 
$
(33
)
 
$
1

 
 
Policyholder liabilities (1)
 
(800
)
 
807

 
7

Foreign currency swaps:
 
Foreign-denominated fixed maturity securities
 
13

 
(12
)
 
1

 
 
Foreign-denominated PABs (2)
 
(98
)
 
112

 
14

Total
 
$
(851
)
 
$
874

 
$
23

Year Ended December 31, 2012
 
 
 
 
 
 
Interest rate swaps:
 
Fixed maturity securities
 
$
2

 
$
(3
)
 
$
(1
)
 
 
Policyholder liabilities (1)
 
(72
)
 
89

 
17

Foreign currency swaps:
 
Foreign-denominated fixed maturity securities
 
(1
)
 
1

 
—

 
 
Foreign-denominated PABs (2)
 
32

 
(41
)
 
(9
)
Total
 
$
(39
)
 
$
46

 
$
7

______________
(1)
Fixed rate liabilities reported in PABs or future policy benefits.
(2)
Fixed rate or floating rate liabilities.
Schedule of estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps
The following table presents the estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps at:
 
 
December 31,
 
 
2014
 
2013
Rating Agency Designation of Referenced
Credit Obligations (1)
 
Estimated
Fair Value
of Credit
Default
Swaps
 
Maximum
Amount of Future
Payments under
Credit Default
Swaps (2)
 
Weighted
Average
Years to
Maturity (3)
 
Estimated
Fair Value
of Credit
Default
Swaps
 
Maximum
Amount of Future
Payments under
Credit Default
Swaps (2)
 
Weighted
Average
Years to
Maturity (3)
 
 
(In millions)
 
 
 
(In millions)
 
 
Aaa/Aa/A
 
 
 
 
 
 
 
 
 
 
 
 
Single name credit default swaps (corporate)
 
$
5

 
$
415

 
2.2

 
$
6

 
$
395

 
2.6

Credit default swaps referencing indices
 
10

 
1,566

 
2.7

 
20

 
2,089

 
1.6

Subtotal
 
15

 
1,981

 
2.6

 
26

 
2,484

 
1.7

Baa
 
 
 
 
 
 
 
 
 
 
 
 
Single name credit default swaps (corporate)
 
15

 
1,002

 
2.8

 
16

 
874

 
3.2

Credit default swaps referencing indices
 
59

 
3,687

 
4.5

 
52

 
2,898

 
4.7

Subtotal
 
74

 
4,689

 
4.1

 
68

 
3,772

 
4.4

Ba
 
 
 
 
 
 
 
 
 
 
 
 
Single name credit default swaps (corporate)
 
—

 
60

 
3.0

 
—

 
5

 
3.8

Credit default swaps referencing indices
 
(1
)
 
100

 
2.0

 
—

 
—

 
—

Subtotal
 
(1
)
 
160

 
2.4

 
—

 
5

 
3.8

B
 
 
 
 
 
 
 
 
 
 
 
 
Single name credit default swaps (corporate)
 
—

 
—

 
—

 
—

 
—

 
—

Credit default swaps referencing indices
 
37

 
589

 
4.9

 
29

 
339

 
4.9

Subtotal
 
37

 
589

 
4.9

 
29

 
339

 
4.9

Total
 
$
125

 
$
7,419

 
3.8

 
$
123

 
$
6,600

 
3.4

______________
(1)
The rating agency designations are based on availability and the midpoint of the applicable ratings among Moody’s Investors Service (“Moody’s”), S&P and Fitch Ratings. If no rating is available from a rating agency, then an internally developed rating is used.
(2)
Assumes the value of the referenced credit obligations is zero.
(3)
The weighted average years to maturity of the credit default swaps is calculated based on weighted average gross notional amounts.
Estimated Fair Value of Derivative Assets and Liabilities after Master Netting Agreements and Cash Collateral
The estimated fair values of the Company’s net derivative assets and net derivative liabilities after the application of master netting agreements and collateral were as follows at:
 
 
December 31, 2014
 
December 31, 2013
Derivatives Subject to a Master Netting Arrangement or a Similar Arrangement
 
Assets
 
Liabilities
 
Assets
 
Liabilities
 
 
(In millions)
Gross estimated fair value of derivatives:
 
 
 
 
 
 
 
 
OTC-bilateral (1)
 
$
6,497

 
$
2,092

 
$
4,026

 
$
2,232

OTC-cleared (1)
 
740

 
682

 
251

 
117

Exchange-traded
 
10

 
—

 
—

 
—

Total gross estimated fair value of derivatives (1)
 
7,247

 
2,774

 
4,277

 
2,349

Amounts offset on the consolidated balance sheets
 
—

 
—

 
—

 
—

Estimated fair value of derivatives presented on the consolidated balance sheets (1)
 
7,247

 
2,774

 
4,277

 
2,349

Gross amounts not offset on the consolidated balance sheets:
 
 
 
 
 
 
 
 
Gross estimated fair value of derivatives: (2)
 
 
 
 
 
 
 
 
OTC-bilateral
 
(1,742
)
 
(1,742
)
 
(1,844
)
 
(1,844
)
OTC-cleared
 
(638
)
 
(638
)
 
(114
)
 
(114
)
Exchange-traded
 
—

 
—

 
—

 
—

Cash collateral: (3), (4)
 
 
 
 
 
 
 
 
OTC-bilateral
 
(2,470
)
 
(2
)
 
(1,143
)
 
(3
)
OTC-cleared
 
(97
)
 
(40
)
 
(128
)
 
(3
)
Exchange-traded
 
—

 
—

 
—

 
—

Securities collateral: (5)
 
 
 
 
 
 
 
 
OTC-bilateral
 
(2,161
)
 
(333
)
 
(1,024
)
 
(319
)
OTC-cleared
 
—

 
(3
)
 
—

 
—

Exchange-traded
 
—

 
—

 
—

 
—

Net amount after application of master netting agreements and collateral
 
$
139

 
$
16

 
$
24

 
$
66

__________________
(1)
At December 31, 2014 and 2013, derivative assets include income or expense accruals reported in accrued investment income or in other liabilities of $143 million and $136 million, respectively, and derivative liabilities include income or expense accruals reported in accrued investment income or in other liabilities of $42 million and $27 million, respectively.
(2)
Estimated fair value of derivatives is limited to the amount that is subject to set-off and includes income or expense accruals.
(3)
Cash collateral received by the Company for OTC-bilateral and OTC-cleared derivatives is included in cash and cash equivalents, short-term investments or in fixed maturity securities, and the obligation to return it is included in payables for collateral under securities loaned and other transactions on the balance sheet. In certain instances, cash collateral pledged to the Company as initial margin for OTC-bilateral derivatives is held in separate custodial accounts and is not recorded on the Company’s balance sheet because the account title is in the name of the counterparty (but segregated for the benefit of the Company). The amount of this off-balance sheet collateral was $138 million and $0 at December 31, 2014 and 2013, respectively.
(4)
The receivable for the return of cash collateral provided by the Company is inclusive of initial margin on exchange-traded and OTC-cleared derivatives and is included in premiums, reinsurance and other receivables on the balance sheet. The amount of cash collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreements. At December 31, 2014 and 2013, the Company received excess cash collateral of $0 and $47 million, respectively, and provided excess cash collateral of $31 million and $3 million, respectively, which is not included in the table above due to the foregoing limitation.
(5)
Securities collateral received by the Company is held in separate custodial accounts and is not recorded on the balance sheet. Subject to certain constraints, the Company is permitted by contract to sell or re-pledge this collateral, but at December 31, 2014 none of the collateral had been sold or re-pledged . Securities collateral pledged by the Company is reported in fixed maturity securities on the balance sheet. Subject to certain constraints, the counterparties are permitted by contract to sell or re-pledge this collateral. The amount of securities collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreements and cash collateral. At December 31, 2014 and 2013, the Company received excess securities collateral with an estimated fair value of $243 million and $106 million, respectively, for its OTC-bilateral derivatives, which are not included in the table above due to the foregoing limitation. At December 31, 2014 and 2013, the Company provided excess securities collateral with an estimated fair value of $57 million and $25 million, respectively, for its OTC-bilateral derivatives, and $155 million and $106 million, respectively, for its OTC-cleared derivatives, and $17 million and $0 respectively, for its exchange-traded derivatives, which are not included in the table above due to the foregoing limitation.
Derivative Instruments, Gain (Loss) [Line Items]  
Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location
The following table presents the effects of derivatives in cash flow hedging relationships on the consolidated statements of operations and the consolidated statements of equity:
 
 
 
 
 
 
 
 
 
Derivatives in Cash Flow
Hedging Relationships
 
Amount of Gains
(Losses)Deferred in
AOCI on Derivatives
 
Amount and Location
of Gains (Losses)
Reclassified from
AOCI into Income (Loss)
 
Amount and  Location
of Gains (Losses)
Recognized in Income (Loss)
on Derivatives
  
 
(Effective Portion)
 
(Effective Portion)
(Ineffective Portion)
 
 
 
 
Net Derivative Gains (Losses)
 
Net Investment
Income
 
Net Derivative
Gains  (Losses)
 
 
(In millions)
Year Ended December 31, 2014
 
 
 
 
 
 
Interest rate swaps
 
$
587

 
$
41

 
$
9

 
$
3

Interest rate forwards
 
34

 
(8
)
 
2

 
—

Foreign currency swaps
 
(15
)
 
(725
)
 
(2
)
 
2

Credit forwards
 
—

 
—

 
1

 
—

Total
 
$
606

 
$
(692
)
 
$
10

 
$
5

Year Ended December 31, 2013
 
 
 
 
 
 
Interest rate swaps
 
$
(511
)
 
$
20

 
$
8

 
$
(3
)
Interest rate forwards
 
(43
)
 
1

 
2

 
—

Foreign currency swaps
 
(120
)
 
(15
)
 
(3
)
 
2

Credit forwards
 
(3
)
 
—

 
1

 
—

Total
 
$
(677
)
 
$
6

 
$
8

 
$
(1
)
Year Ended December 31, 2012
 
 
 
 
 
 
Interest rate swaps
 
$
(55
)
 
$
3

 
$
4

 
$
1

Interest rate forwards
 
(1
)
 
—

 
2

 
—

Foreign currency swaps
 
(187
)
 
(7
)
 
(5
)
 
(5
)
Credit forwards
 
—

 
—

 
1

 
—

Total
 
$
(243
)
 
$
(4
)
 
$
2

 
$
(4
)
Schedule of Derivative Instruments
The following table presents the estimated fair value of the Company’s OTC-bilateral derivatives that are in a net liability position after considering the effect of netting agreements, together with the estimated fair value and balance sheet location of the collateral pledged. The table also presents the incremental collateral that the Company would be required to provide if there was a one notch downgrade in the Company’s financial strength rating at the reporting date or if the Company’s financial strength rating sustained a downgrade to a level that triggered full overnight collateralization or termination of the derivative position at the reporting date. OTC-bilateral derivatives that are not subject to collateral agreements are excluded from this table.
 
 
 
Estimated Fair Value of
Collateral Provided
 
Fair Value of Incremental
Collateral Provided Upon
 
Estimated
Fair Value of Derivatives in 
Net Liability 
Position  (1)
 
Fixed Maturity
Securities
 
Cash
 
One Notch
Downgrade in
the Company’s
Financial Strength Rating
 
Downgrade in the Company’s 
Financial Strength Rating
to a Level
that Triggers Full Overnight
Collateralization or Termination
of the Derivative Position
 
(In millions)
December 31, 2014
 
 
 
 
 
 
 
 
 
Derivatives subject to financial strength-contingent provisions
$
334

 
$
390

 
$
—

 
$
—

 
$
—

Derivatives not subject to financial strength-contingent provisions
4

 
—

 
2

 
—

 
—

Total
$
338

 
$
390

 
$
2

 
$
—

 
$
—

December 31, 2013
 
 
 
 
 
 
 
 
 
Derivatives subject to financial strength-contingent provisions
$
354

 
$
344

 
$
—

 
$
—

 
$
5

Derivatives not subject to financial strength-contingent provisions
4

 
—

 
3

 
—

 
—

Total
$
358

 
$
344

 
$
3

 
$
—

 
$
5

______________
(1)
After taking into consideration the existence of netting agreements.
Embedded Derivative Financial Instruments [Member]  
Derivative Instruments, Gain (Loss) [Line Items]  
Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location
The following table presents changes in estimated fair value related to embedded derivatives:
 
Years Ended December 31,
  
2014
 
2013
 
2012
 
(In millions)
Net derivative gains (losses) (1), (2)
$
(170
)
 
$
135

 
$
598

______________
(1)
The valuation of direct and assumed guaranteed minimum benefits includes a nonperformance risk adjustment. The amounts included in net derivative gains (losses), in connection with this adjustment, were $14 million, ($42) million and ($71) million for the years ended December 31, 2014, 2013 and 2012, respectively. In addition, the valuation of ceded guaranteed minimum benefits includes a nonperformance risk adjustment. The amounts included in net derivative gains (losses) in connection with this adjustment were ($9) million, $125 million and $122 million for the years ended December 31, 2014, 2013 and 2012, respectively.
(2)
See Note 6 for discussion of affiliated net derivative gains (losses) included in the table above.
Schedule of Derivative Instruments
The following table presents the estimated fair value and balance sheet location of the Company’s embedded derivatives that have been separated from their host contracts at:
 
 
 
December 31,
 
Balance Sheet Location
 
2014
 
2013
 
 
 
(In millions)
Net embedded derivatives within asset host contracts:
 
 
 
 
 
Ceded guaranteed minimum benefits
Premiums, reinsurance and other receivables
 
$
657

 
$
(62
)
Options embedded in debt or equity securities
Investments
 
(150
)
 
(106
)
Net embedded derivatives within asset host contracts
 
$
507

 
$
(168
)
Net embedded derivatives within liability host contracts:
 
 
 
 
Direct guaranteed minimum benefits
PABs
 
$
(548
)
 
$
(868
)
Assumed guaranteed minimum benefits
PABs
 
72

 
—

Funds withheld on ceded reinsurance
Other liabilities
 
1,200

 
758

Other
PABs
 
7

 
4

Net embedded derivatives within liability host contracts
 
$
731

 
$
(106
)