CNA FINANCIAL CORP, 10-Q filed on 5/5/2015
Quarterly Report
Document and Entity Information Document
3 Months Ended
Mar. 31, 2015
May 1, 2015
Document and Entity Information [Abstract]
 
 
Entity Registrant Name
CNA FINANCIAL CORP 
 
Entity Central Index Key
0000021175 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Large Accelerated Filer 
 
Document Type
10-Q 
 
Document Period End Date
Mar. 31, 2015 
 
Document Fiscal Year Focus
2015 
 
Document Fiscal Period Focus
Q1 
 
Amendment Flag
false 
 
Entity Common Stock, Shares Outstanding
 
270,245,346 
Consolidated Statements of Operations (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Revenues
 
 
Net earned premiums
$ 1,687 
$ 1,806 
Net investment income
558 
526 
Net realized investment gains (losses):
 
 
Other-than-temporary impairment losses
(12)
(2)
Portion of other-than-temporary impairments recognized in Other comprehensive income
0 
0 
Net other-than-temporary impairment losses recognized in earnings
(12)
(2)
Other net realized investment gains (loss)
22 
48 
Net realized investment gains (losses)
10 
46 
Other revenues
97 
85 
Total revenues
2,352 
2,463 
Claims, Benefits and Expenses
 
 
Insurance claims and policyholders' benefits
1,339 
1,446 
Amortization of deferred acquisition costs
303 
329 
Other operating expenses
358 
346 
Interest
39 
44 
Total claims, benefits and expenses
2,039 
2,165 
Income (loss) from continuing operations before income tax
313 
298 
Income tax expense (benefit)
(80)
(78)
Net income (loss) from continuing operations
233 
220 
(Loss) income from discontinued operations, net of income tax benefit (expense)
0 
(207)
Net income (loss)
$ 233 
$ 13 
Basic Earnings (Loss) Per Share Attributable to CNA
 
 
Income from continuing operations
$ 0.86 
$ 0.82 
(Loss) income from discontinued operations
$ 0.00 
$ (0.77)
Basic earnings per share
$ 0.86 
$ 0.05 
Diluted Earnings (Loss) Per Share Attributable to CNA
 
 
Income (loss) from continuing operations
$ 0.86 
$ 0.81 
(Loss) income from discontinued operations
$ 0.00 
$ (0.76)
Diluted earnings (loss) per share
$ 0.86 
$ 0.05 
Dividends per share
$ 2.25 
$ 1.25 
Weighted Average Outstanding Common Stock and Common Stock Equivalents
 
 
Basic
0 
0 
Diluted
0 
0 
Consolidated Statements of Operations Parenthetical (Parentheticals) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Income Statement [Abstract]
 
 
Income tax benefit (expense) on discontinued operations
$ 0 
$ 38 
Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Other Comprehensive Income (Loss), Net of Tax, Changes In:
 
 
Net unrealized gains (losses) on investments with other-than-temporary impairments
$ (1)
$ 12 
Net unrealized gains (losses) on other investments
112 
237 
Net unrealized gains (losses) on investments
111 
249 
Net unrealized gains (losses) on discontinued operations
0 
8 
Foreign currency translation adjustment
(96)
(8)
Pension and postretirement benefits
6 
1 
Other comprehensive income (loss)
21 
250 
Net income (loss)
233 
13 
Total comprehensive income (loss)
$ 254 
$ 263 
Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Assets
 
 
Fixed maturity securities at fair value
$ 40,605 
$ 40,768 
Equity securities at fair value
225 
222 
Limited partnership investments
2,967 
2,937 
Other invested assets
43 
41 
Mortgage loans
586 
588 
Short term investments
1,506 
1,706 
Total investments
45,932 
46,262 
Cash
201 
190 
Reinsurance receivables
4,720 
4,694 
Insurance receivables
2,050 
1,936 
Accrued investment income
430 
405 
Deferred acquisition costs
616 
600 
Deferred income taxes
57 
191 
Property and equipment at cost
298 
295 
Goodwill
151 
152 
Other assets
1,010 
841 
Total assets
55,465 
55,566 
Liabilities
 
 
Claim and claim adjustment expenses
23,248 
23,271 
Unearned premiums
3,710 
3,592 
Future policy benefits
9,747 
9,490 
Policyholders’ funds
0 
27 
Long term debt
2,560 
2,559 
Other liabilities
3,763 
3,833 
Total liabilities
43,028 
42,772 
Stockholders' Equity
 
 
Common stock
683 
683 
Additional paid-in capital
2,143 
2,151 
Retained earnings
9,270 
9,645 
Accumulated other comprehensive income (loss)
421 
400 
Treasury stock
(79)
(84)
Notes receivable for the issuance of common stock
(1)
(1)
Total stockholders’ equity
12,437 
12,794 
Total liabilities and stockholders' equity
$ 55,465 
$ 55,566 
Consolidated Balance Sheet Parentheticals (Parentheticals) (USD $)
In Millions, except Share data, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Statement of Financial Position [Abstract]
 
 
Fixed maturities securities at amortized cost
$ 36,875 
$ 37,335 
Equity securities at cost
213 
210 
Allowance for uncollectible reinsurance receivables
48 
48 
Allowance for uncollectible insurance receivables
59 
61 
Accumulated depreciation on property and equipment
364 
364 
Due to Related Parties
$ 6 
$ 153 
Common stock, par value
$ 2.50 
$ 2.50 
Common stock, shares authorized
500,000,000 
500,000,000 
Common stock, shares issued
273,040,243 
273,040,243 
Common stock, shares outstanding
270,241,545 
269,980,202 
Treasury stock, shares
2,798,698 
3,060,041 
Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Cash Flows from Operating Activities
 
 
Net income (loss)
$ 233 
$ 13 
Adjustments to reconcile net income (loss) to net cash flows provided (used) by operating activities:
 
 
Impairment loss on sale of subsidiary
0 
255 
Deferred income tax expense (benefit)
71 
25 
Trading portfolio activity
13 
21 
Net realized investment (gains) losses
(10)
(47)
Equity method investees
(91)
132 
Net amortization of investments
0 
(1)
Depreciation and amortization
19 
20 
Changes in:
 
 
Receivables, net
(157)
126 
Accrued investment income
(25)
(36)
Deferred acquisition costs
(13)
(21)
Insurance reserves
304 
85 
Other assets
(34)
(35)
Other liabilities
(235)
(372)
Other, net
19 
3 
Total adjustments
(139)
155 
Net cash flows provided (used) by operating activities
94 
168 
Dispositions:
 
 
Fixed maturity securities - sales
1,144 
1,550 
Fixed maturity securities - maturities, calls and redemptions
1,144 
851 
Equity securities
2 
11 
Limited partnerships
20 
68 
Mortgage loans
3 
13 
Purchases:
 
 
Fixed maturity securities
(1,919)
(2,072)
Equity securities
(5)
(5)
Limited partnerships
(34)
(73)
Mortgage Loans
(8)
0 
Change in other investments
7 
0 
Change in short term investments
190 
(688)
Purchases of property and equipment
(20)
(10)
Other, net
2 
1 
Net cash flows provided (used) by investing activities
526 
(354)
Cash Flows from Financing Activities
 
 
Dividends paid to common stockholders
(608)
(338)
Proceeds from the issuance of debt
0 
546 
Other, net
5 
2 
Net cash flows provided (used) by financing activities
(603)
210 
Effect of foreign exchange rate changes on cash
(6)
1 
Transfer of cash to assets held for sale
0 
(14)
Net change in cash
11 
11 
Cash, beginning of year
190 
195 
Cash, end of period
$ 201 
$ 206 
Consolidated Statements of Stockholders' Equity (USD $)
In Millions
Total
Common stock [Member]
Additional paid-in capital [Member]
Retained earnings [Member]
Accumulated other comprehensive income (loss) [Member]
Treasury stock [Member]
Notes receivable for the issuance of common stock [Member]
Balance at Dec. 31, 2013
 
$ 683 
$ 2,145 
$ 9,495 
$ 442 
$ (91)
$ (23)
Net income (loss)
13 
 
 
13 
 
 
 
Other comprehensive income (loss)
250 
 
 
 
250 
 
 
Dividends paid to common stockholders
 
 
 
(338)
 
 
 
Stock-based compensation
 
 
(1)
 
 
6 
 
Decrease (increase) in notes receivable from the issuance of common stock
 
 
 
 
 
 
1 
Balance at Mar. 31, 2014
12,582 
683 
2,144 
9,170 
692 
(85)
(22)
Balance at Dec. 31, 2014
12,794 
683 
2,151 
9,645 
400 
(84)
(1)
Net income (loss)
233 
 
 
233 
 
 
 
Other comprehensive income (loss)
21 
 
 
 
21 
 
 
Dividends paid to common stockholders
 
 
 
(608)
 
 
 
Stock-based compensation
 
 
(8)
 
 
5 
 
Decrease (increase) in notes receivable from the issuance of common stock
 
 
 
 
 
 
0 
Balance at Mar. 31, 2015
$ 12,437 
$ 683 
$ 2,143 
$ 9,270 
$ 421 
$ (79)
$ (1)
General
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]
Note A. General
Basis of Presentation
The Condensed Consolidated Financial Statements (Unaudited) include the accounts of CNA Financial Corporation (CNAF) and its subsidiaries. Collectively, CNAF and its subsidiaries are referred to as CNA or the Company. Loews Corporation (Loews) owned approximately 90% of the outstanding common stock of CNAF as of March 31, 2015.
The accompanying Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Intercompany amounts have been eliminated. Certain financial information that is normally included in annual financial statements, including certain financial statement notes, prepared in accordance with GAAP, is not required for interim reporting purposes and has been condensed or omitted. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in CNAF's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2014, including the summary of significant accounting policies in Note A. The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Actual results may differ from those estimates.
The interim financial data as of March 31, 2015 and for the three months ended March 31, 2015 and 2014 is unaudited. However, in the opinion of management, the interim data includes all adjustments, including normal recurring adjustments, necessary for a fair statement of the Company's results for the interim periods. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.
Sale of Continental Assurance Company (CAC)
On August 1, 2014, the Company completed the sale of the common stock of CAC, the Company's former life insurance subsidiary. In the first quarter of 2014, the Company recorded an after-tax impairment loss of $214 million related to the sale. The Company elected to include CAC cash flow activity in the comparative Condensed Consolidated Statement of Cash Flows. Further information on discontinued operations is provided in Note K to the Condensed Consolidated Financial Statements.
Earnings Per Share Earnings Per Share
Earnings Per Share [Text Block]
Note B. Earnings Per Share
Earnings per share is based on the weighted average number of outstanding common shares. Basic earnings (loss) per share excludes the effect of dilutive securities and is computed by dividing Net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.
For the three months ended March 31, 2015 and 2014, approximately 654 thousand and 660 thousand potential shares attributable to exercises under stock-based employee compensation plans were included in the calculation of diluted earnings per share. For those same periods, approximately 182 thousand and 110 thousand potential shares attributable to exercises under stock-based employee compensation plans were not included in the calculation of diluted earnings per share because the effect would have been antidilutive.
Investments
Investments
Note C. Investments
The significant components of Net investment income are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Fixed maturity securities
$
443

 
$
452

Short term investments
2

 
1

Limited partnership investments
114

 
73

Equity securities
3

 
2

Mortgage loans
8

 
6

Trading portfolio
2

 
3

Other
—

 
2

Gross investment income
572

 
539

Investment expense
(14
)
 
(13
)
Net investment income
$
558

 
$
526


Net realized investment gains (losses) are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Net realized investment gains (losses):
 
 
 
Fixed maturity securities:
 
 
 
Gross realized gains
$
33

 
$
53

Gross realized losses
(21
)
 
(15
)
Net realized investment gains (losses) on fixed maturity securities
12

 
38

Equity securities:
 
 
 

Gross realized gains
1

 
5

Gross realized losses
(1
)
 
—

Net realized investment gains (losses) on equity securities
—

 
5

Derivatives
(1
)
 
—

Short term investments and other
(1
)
 
3

Net realized investment gains (losses)
$
10

 
$
46


The components of Net other-than-temporary impairment (OTTI) losses recognized in earnings by asset type are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Fixed maturity securities available-for-sale:
 
 
 
Corporate and other bonds
$
5

 
$
1

States, municipalities and political subdivisions
5

 
—

Asset-backed - residential mortgage-backed
1

 
1

Total fixed maturity securities available-for-sale
11

 
2

Equity securities available-for-sale:
 
 
 
Common stock
1

 
—

Net OTTI losses recognized in earnings
$
12

 
$
2


The following tables present a summary of fixed maturity and equity securities.
March 31, 2015
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair
Value
 
Unrealized
OTTI
Losses (Gains)
(In millions)
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
16,721

 
$
1,867

 
$
43

 
$
18,545

 
$
—

States, municipalities and political subdivisions
11,407

 
1,536

 
9

 
12,934

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
4,998

 
241

 
13

 
5,226

 
(51
)
Commercial mortgage-backed
2,151

 
114

 
5

 
2,260

 
(3
)
Other asset-backed
1,109

 
15

 
1

 
1,123

 
—

Total asset-backed
8,258

 
370

 
19

 
8,609

 
(54
)
U.S. Treasury and obligations of government-sponsored enterprises
24

 
6

 
—

 
30

 
—

Foreign government
390

 
19

 
—

 
409

 
—

Redeemable preferred stock
39

 
3

 
—

 
42

 
—

Total fixed maturity securities available-for-sale
36,839

 
3,801

 
71

 
40,569

 
$
(54
)
Total fixed maturity securities trading
36

 


 


 
36

 
 
Equity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Common stock
41

 
9

 
—

 
50

 
 
Preferred stock
172

 
7

 
4

 
175

 
 
Total equity securities available-for-sale
213

 
16

 
4

 
225

 
 
Total
$
37,088

 
$
3,817

 
$
75

 
$
40,830

 
 

December 31, 2014
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair
Value
 
Unrealized
OTTI
Losses (Gains)
(In millions)
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
17,210

 
$
1,721

 
$
61

 
$
18,870

 
$
—

States, municipalities and political subdivisions
11,285

 
1,463

 
8

 
12,740

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
5,028

 
218

 
13

 
5,233

 
(53
)
Commercial mortgage-backed
2,056

 
93

 
5

 
2,144

 
(2
)
Other asset-backed
1,234

 
11

 
10

 
1,235

 
—

Total asset-backed
8,318

 
322

 
28

 
8,612

 
(55
)
U.S. Treasury and obligations of government-sponsored enterprises
26

 
5

 
—

 
31

 
—

Foreign government
438

 
16

 
—

 
454

 
—

Redeemable preferred stock
39

 
3

 
—

 
42

 
—

Total fixed maturity securities available-for-sale
37,316

 
3,530

 
97

 
40,749

 
$
(55
)
Total fixed maturity securities trading
19

 


 


 
19

 
 
Equity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Common stock
38

 
9

 
—

 
47

 
 
Preferred stock
172

 
5

 
2

 
175

 
 
Total equity securities available-for-sale
210

 
14

 
2

 
222

 
 
Total
$
37,545

 
$
3,544

 
$
99

 
$
40,990

 
 


The net unrealized gains on investments included in the tables above are recorded as a component of Accumulated other comprehensive income (AOCI). When presented in AOCI, these amounts are net of tax and any required Shadow Adjustments. As of March 31, 2015 and December 31, 2014, the net unrealized gains on investments included in AOCI were net of after-tax Shadow Adjustments of $1,370 million and $1,288 million. To the extent that unrealized gains on fixed income securities supporting certain products within the Life & Group Non-Core segment would result in a premium deficiency if realized, a related decrease in Deferred acquisition costs and/or increase in Insurance reserves are recorded, net of tax, as a reduction of net unrealized gains through Other comprehensive income (loss) (Shadow Adjustments).
The following tables present the estimated fair value and gross unrealized losses of fixed maturity and equity securities in a gross unrealized loss position by the length of time in which the securities have continuously been in that position.
 
Less than 12 Months
 
12 Months or Longer
 
Total
March 31, 2015
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
(In millions)
 
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
840

 
$
31

 
$
139

 
$
12

 
$
979

 
$
43

States, municipalities and political subdivisions
479

 
6

 
100

 
3

 
579

 
9

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
318

 
5

 
148

 
8

 
466

 
13

Commercial mortgage-backed
175

 
3

 
62

 
2

 
237

 
5

Other asset-backed
187

 
1

 
5

 
—

 
192

 
1

Total asset-backed
680

 
9

 
215

 
10

 
895

 
19

U.S. Treasury and obligations of government-sponsored enterprises
3

 
—

 
—

 
—

 
3

 
—

Foreign government
13

 
—

 
1

 
—

 
14

 
—

Total fixed maturity securities available-for-sale
2,015

 
46

 
455

 
25

 
2,470

 
71

Equity securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
Preferred stock
15

 
4

 
—

 
—

 
15

 
4

Total
$
2,030

 
$
50

 
$
455

 
$
25

 
$
2,485

 
$
75


 
Less than 12 Months
 
12 Months or Longer
 
Total
December 31, 2014
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
(In millions)
 
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
1,330

 
$
46

 
$
277

 
$
15

 
$
1,607

 
$
61

States, municipalities and political subdivisions
335

 
5

 
127

 
3

 
462

 
8

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
293

 
5

 
189

 
8

 
482

 
13

Commercial mortgage-backed
264

 
2

 
99

 
3

 
363

 
5

Other asset-backed
607

 
10

 
7

 
—

 
614

 
10

Total asset-backed
1,164

 
17

 
295

 
11

 
1,459

 
28

U.S. Treasury and obligations of government-sponsored enterprises
3

 
—

 
4

 
—

 
7

 
—

   Foreign government
3

 
—

 
3

 
—

 
6

 
—

Redeemable preferred stock
3

 
—

 
—

 
—

 
3

 
—

Total fixed maturity securities available-for-sale
2,838

 
68

 
706

 
29

 
3,544

 
97

Equity securities available-for-sale:


 


 


 


 


 


   Preferred stock
17

 
2

 
1

 
—

 
18

 
2

Total
$
2,855

 
$
70

 
$
707

 
$
29

 
$
3,562

 
$
99




Based on current facts and circumstances, the Company believes the unrealized losses presented in the March 31, 2015 table above, are not indicative of the ultimate collectibility of the current amortized cost of the securities, but rather are primarily attributable to changes in interest rates and credit spreads, market illiquidity and other factors. The Company has no current intent to sell securities with unrealized losses, nor is it more likely than not that it will be required to sell prior to recovery of amortized cost; accordingly, the Company has determined that there are no additional OTTI losses to be recorded as of March 31, 2015.
The following table presents the activity related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held as of March 31, 2015 and 2014 for which a portion of an OTTI loss was recognized in Other comprehensive income.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Beginning balance of credit losses on fixed maturity securities
$
62

 
$
74

Reductions for securities sold during the period
(1
)
 
(2
)
Reductions for securities the Company intends to sell or more likely than not will be required to sell
—

 
(3
)
Ending balance of credit losses on fixed maturity securities
$
61

 
$
69


Contractual Maturity
The following table presents available-for-sale fixed maturity securities by contractual maturity.
 
March 31, 2015
 
December 31, 2014
(In millions)
Cost or
Amortized
Cost
 
Estimated
Fair
Value
 
Cost or
Amortized
Cost
 
Estimated
Fair
Value
Due in one year or less
$
2,011

 
$
2,043

 
$
2,479

 
$
2,511

Due after one year through five years
8,760

 
9,340

 
9,054

 
9,605

Due after five years through ten years
12,401

 
13,108

 
12,055

 
12,584

Due after ten years
13,667

 
16,078

 
13,728

 
16,049

Total
$
36,839

 
$
40,569

 
$
37,316

 
$
40,749


Actual maturities may differ from contractual maturities because certain securities may be called or prepaid with or without call or prepayment penalties. Securities not due at a single date are allocated based on weighted average life.
Derivative Financial Instruments
The following tables present the aggregate contractual or notional amounts and estimated fair values related to derivative financial instruments.
March 31, 2015
Contractual/
Notional
Amount
 
Estimated Fair Value
(In millions)
 
Asset
 
Liability
Without hedge designation
 
 
 
 
 
Currency forwards
$
18

 
$
2

 
$
—

Equity warrants
5

 
—

 
—

Embedded derivative on funds withheld liability
184

 
—

 
5

Total
 
 
$
2

 
$
5


December 31, 2014
Contractual/
Notional
Amount
 
Estimated Fair Value
(In millions)
 
Asset
 
Liability
Without hedge designation
 
 
 
 
 
Currency forwards
$
9

 
$
—

 
$
—

Equity warrants
5

 
—

 
—

Embedded derivative on funds withheld liability
184

 
—

 
3

Total
 
 
$
—

 
$
3


Derivative financial instruments are presented gross in Other invested assets and Other liabilities on the Condensed Consolidated Balance Sheets. There would be no significant difference in the balance included in such accounts if the estimated fair values were presented net as of March 31, 2015 and December 31, 2014.
Investment Commitments
As of March 31, 2015, the Company had committed approximately $338 million to future capital calls from various third-party limited partnership investments in exchange for an ownership interest in the related partnerships.
As of March 31, 2015, the Company had mortgage loan commitments of $41 million representing signed loan applications received and accepted.
The Company invests in various privately placed debt securities, including bank loans, as part of its overall investment strategy and has committed to additional future purchases, sales and funding. As of March 31, 2015, the Company had commitments to purchase or fund additional amounts of $82 million and sell $71 million under the terms of such securities.
Fair Value
Fair Value
Note D. Fair Value
Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1, as these are the most transparent or reliable.
Level 1 - Quoted prices for identical instruments in active markets.
Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.
Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are not observable.
Prices may fall within Level 1, 2 or 3 depending upon the methodologies and inputs used to estimate fair value for each specific security. In general the Company seeks to price securities using third-party pricing services. Securities not priced by pricing services are submitted to independent brokers for valuation and, if those are not available, internally developed pricing models are used to value assets using methodologies and inputs the Company believes market participants would use to value the assets. Prices obtained from third-party pricing services or brokers are not adjusted by the Company.
The Company performs control procedures over information obtained from pricing services and brokers to ensure prices received represent a reasonable estimate of fair value and to confirm representations regarding whether inputs are observable or unobservable. Procedures include i) the review of pricing service or broker pricing methodologies, ii) back-testing, where past fair value estimates are compared to actual transactions executed in the market on similar dates, iii) exception reporting, where changes in price, period-over-period, are reviewed and challenged with the pricing service or broker based on exception criteria, iv) deep dives, where the Company performs an independent analysis of the inputs and assumptions used to price individual securities and v) pricing validation, where prices received are compared to prices independently estimated by the Company.
Assets and Liabilities Measured at Fair Value
Assets and liabilities measured at fair value on a recurring basis are presented in the following tables.
March 31, 2015
 
 
 
 
 
 
Total
Assets/ Liabilities
at Fair Value
(In millions)
Level 1
 
Level 2
 
Level 3
 
Assets
 
 
 
 
 
 
 
Fixed maturity securities:
 
 
 
 
 
 
 
Corporate and other bonds
$
29

 
$
18,337

 
$
186

 
$
18,552

States, municipalities and political subdivisions
—

 
12,877

 
86

 
12,963

Asset-backed:
 
 
 
 
 
 
 
Residential mortgage-backed
—

 
4,994

 
232

 
5,226

Commercial mortgage-backed
—

 
2,196

 
64

 
2,260

Other asset-backed
—

 
570

 
553

 
1,123

Total asset-backed
—

 
7,760

 
849

 
8,609

U.S. Treasury and obligations of government-sponsored enterprises
29

 
1

 
—

 
30

Foreign government
37

 
372

 
—

 
409

Redeemable preferred stock
30

 
12

 
—

 
42

Total fixed maturity securities
125

 
39,359

 
1,121

 
40,605

Equity securities
149

 
63

 
13

 
225

Derivative financial instruments
—

 
2

 
—

 
2

Other invested assets, excluding derivative financial instruments
—

 
41

 
—

 
41

Short term investments
742

 
678

 
—

 
1,420

Life settlement contracts, included in Other assets
—

 
—

 
79

 
79

Total assets
$
1,016

 
$
40,143

 
$
1,213

 
$
42,372

Liabilities
 
 
 
 
 

 
 

Other liabilities
$
—

 
$
5

 
$
—

 
$
5

Total liabilities
$
—

 
$
5

 
$
—

 
$
5

December 31, 2014
 
 
 
 
 
 
Total
Assets/Liabilities
at Fair Value
(In millions)
Level 1
 
Level 2
 
Level 3
 
Assets
 
 
 
 
 
 
 
Fixed maturity securities:
 
 
 
 
 
 
 
Corporate and other bonds
$
32

 
$
18,695

 
$
162

 
$
18,889

States, municipalities and political subdivisions
—

 
12,646

 
94

 
12,740

Asset-backed:
 
 
 
 
 
 
 

Residential mortgage-backed
—

 
5,044

 
189

 
5,233

Commercial mortgage-backed
—

 
2,061

 
83

 
2,144

Other asset-backed
—

 
580

 
655

 
1,235

Total asset-backed
—

 
7,685

 
927

 
8,612

U.S. Treasury and obligations of government-sponsored enterprises
28

 
3

 
—

 
31

Foreign government
41

 
413

 
—

 
454

Redeemable preferred stock
30

 
12

 
—

 
42

Total fixed maturity securities
131

 
39,454

 
1,183

 
40,768

Equity securities
145

 
61

 
16

 
222

Other invested assets
—

 
41

 
—

 
41

Short term investments
681

 
963

 
—

 
1,644

Life settlement contracts, included in Other assets
—

 
—

 
82

 
82

Total assets
$
957

 
$
40,519

 
$
1,281

 
$
42,757

Liabilities
 
 
 
 
 
 
 
Other liabilities
$
—

 
$
3

 
$
—

 
$
3

Total liabilities
$
—

 
$
3

 
$
—

 
$
3

The following tables present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).
Level 3
(In millions)
Balance as of
January 1,
2015
 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in Net income (loss)
 
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)
 
Purchases
 
Sales
 
Settlements
 
Transfers into
Level 3
 
Transfers out
of Level 3
 
Balance as of
March 31,
2015
 
Unrealized gains (losses) on Level 3 assets and liabilities held as of March 31, 2015 recognized in Net income (loss)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
162

 
$
1

 
$
—

 
$
12

 
$
(12
)
 
$
(14
)
 
$
37

 
$
—

 
$
186

 
$
—

States, municipalities and political subdivisions
94

 
1

 
—

 
—

 
—

 
(9
)
 
—

 
—

 
86

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
Residential mortgage-backed
189

 
1

 
—

 
72

 
—

 
(10
)
 
—

 
(20
)
 
232

 
—

Commercial mortgage-backed
83

 
1

 
1

 
6

 
—

 
(1
)
 
—

 
(26
)
 
64

 
—

Other asset-backed
655

 
1

 
9

 
35

 
(144
)
 
(3
)
 
—

 
—

 
553

 
—

Total asset-backed
927

 
3

 
10

 
113

 
(144
)
 
(14
)
 
—

 
(46
)
 
849

 
—

Total fixed maturity securities
1,183

 
5

 
10

 
125

 
(156
)
 
(37
)
 
37

 
(46
)
 
1,121

 
—

Equity securities
16

 
—

 
(3
)
 
—

 
—

 
—

 
—

 
—

 
13

 
—

Life settlement contracts
82

 
13

 
—

 
—

 
—

 
(16
)
 
—

 
—

 
79

 
1

Total
$
1,281

 
$
18

 
$
7

 
$
125

 
$
(156
)
 
$
(53
)
 
$
37

 
$
(46
)
 
$
1,213

 
$
1


Level 3
(In millions)
Balance as of
January 1,
2014
 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in Net income (loss)
 
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)
 
Purchases
 
Sales
 
Settlements
 
Transfers into
Level 3
 
Transfers out
of Level 3
 
Balance as of
March 31, 2014
 
Unrealized gains (losses) on Level 3 assets and liabilities held as of March 31, 2014 recognized in Net income (loss)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
204

 
$
1

 
$
1

 
$
5

 
$
(4
)
 
$
(5
)
 
$
3

 
$
(16
)
 
$
189

 
$
—

States, municipalities and political subdivisions
71

 
—

 
1

 
—

 
—

 
—

 
14

 
—

 
86

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
331

 
1

 
15

 
25

 
—

 
(21
)
 
21

 
(13
)
 
359

 
—

Commercial mortgage-backed
151

 
1

 
(1
)
 
—

 
—

 
(1
)
 
—

 
(24
)
 
126

 
—

Other asset-backed
446

 
1

 
—

 
148

 
(83
)
 
(72
)
 
—

 
(1
)
 
439

 
—

Total asset-backed
928

 
3

 
14

 
173

 
(83
)
 
(94
)
 
21

 
(38
)
 
924

 
—

Total fixed maturity securities
1,203

 
4

 
16

 
178

 
(87
)
 
(99
)
 
38

 
(54
)
 
1,199

 
—

Equity securities
11

 
3

 
(4
)
 
—

 
(8
)
 
—

 
—

 
—

 
2

 
—

Life settlement contracts
88

 
10

 
—

 
—

 
—

 
(11
)
 
—

 
—

 
87

 
1

Separate account business
1

 
—

 
—

 
—

 
—

 
—

 
—

 
(1
)
 
—

 
—

Total
$
1,303

 
$
17

 
$
12

 
$
178

 
$
(95
)
 
$
(110
)
 
$
38

 
$
(55
)
 
$
1,288

 
$
1

Net realized and unrealized gains and losses, including those shown above, are reported in Net income (loss) as follows:
Major Category of Assets and Liabilities
 
Condensed Consolidated Statements of Operations Line Items
Fixed maturity securities available-for-sale
 
Net realized investment gains (losses)
Fixed maturity securities trading
 
Net investment income
Equity securities
 
Net realized investment gains (losses)
Other invested assets - Derivative financial instruments held in a trading portfolio
 
Net investment income
Other invested assets - Derivative financial instruments not held in a trading portfolio
 
Net realized investment gains (losses)
Other invested assets - Overseas deposits
 
Net investment income
Life settlement contracts
 
Other revenues
Other liabilities - Derivative financial instruments
 
Net realized investment gains (losses)
Securities shown on the previous pages may be transferred in or out of levels within the fair value hierarchy based on the availability of observable market information and quoted prices used to determine the fair value of the security. The availability of observable market information and quoted prices varies based on market conditions and trading volume. During the three months ended March 31, 2015 there were no transfers between Level 1 and Level 2. During the three months ended March 31, 2014 there were $23 million of transfers from Level 2 to Level 1 and $1 million from Level 1 to Level 2. The Company's policy is to recognize transfers between levels at the beginning of quarterly reporting periods.
Valuation Methodologies and Inputs
The following section describes the valuation methodologies and relevant inputs used to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which the instruments are generally classified.
Fixed Maturity Securities
Level 1 securities include exchange traded bonds, highly liquid U.S. and foreign government bonds and redeemable preferred stock, valued using quoted market prices. Level 2 securities include most other fixed maturity securities as the significant inputs are observable in the marketplace. All classes of Level 2 fixed maturity securities are valued using methodologies that model information generated by market transactions involving identical or comparable assets, as well as discounted cash flow methodologies. Common inputs for all classes of fixed maturity securities include prices from recently executed transactions of similar securities, marketplace quotes, benchmark yields, spreads off benchmark yields, interest rates and U.S. Treasury or swap curves. Specifically for asset-backed securities, key inputs include prepayment and default projections based on past performance of the underlying collateral and current market data. Fixed maturity securities are generally assigned to Level 3 in cases where broker/dealer quotes are significant inputs to the valuation and there is a lack of transparency as to whether these quotes are based on information that is observable in the marketplace. Level 3 securities also include private placement debt securities whose fair value is determined using internal models with inputs that are not market observable.
Equity Securities
Level 1 equity securities include publicly traded securities valued using quoted market prices. Level 2 securities are primarily non-redeemable preferred stocks and common stocks valued using pricing for similar securities, recently executed transactions, broker/dealer quotes and other pricing models utilizing market observable inputs. Level 3 securities are priced using internal models with inputs that are not market observable.
Derivative Financial Investments
Level 1 securities include exchange traded derivatives, primarily futures, valued using quoted market prices. Level 2 securities primarily include the embedded derivative on funds withheld liability and currency forwards. The embedded derivative on funds withheld liability is valued using the change in fair value of the assets supporting the funds withheld payable, which are fixed maturity securities valued with observable inputs. Currency forwards are valued using observable market forward rates. Over-the-counter derivatives, principally interest rate swaps, total return swaps, equity warrants and options, are valued using inputs including broker/dealer quotes and are classified within Level 3 of the valuation hierarchy due to a lack of transparency as to whether these quotes are based on information that is observable in the marketplace.
Overseas Deposits
Overseas deposits, which can be redeemed at net asset value in 90 days or less, are classified as Level 2.
Short Term Investments
Securities that are actively traded or have quoted prices are classified as Level 1. These securities include money market funds and treasury bills. Level 2 primarily includes commercial paper, for which all inputs are market observable. Fixed maturity securities purchased within one year of maturity are classified consistent with fixed maturity securities discussed above. Short term investments as presented in the tables above differ from the amounts presented on the Condensed Consolidated Balance Sheets because certain short term investments, such as time deposits, are not measured at fair value.
Life Settlement Contracts
The fair values of life settlement contracts are determined as the present value of the anticipated death benefits less anticipated premium payments based on contract terms that are distinct for each insured, as well as the Company's own assumptions for mortality, premium expense and the rate of return that a buyer would require on the contracts, as no comparable market pricing data is available.
Significant Unobservable Inputs
The following tables present quantitative information about the significant unobservable inputs utilized by the Company in the fair value measurements of Level 3 assets. Valuations for assets and liabilities not presented in the table below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company.
March 31, 2015
 
 
 
 
 
 
 

(In millions)
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range
 (Weighted Average)
Fixed maturity securities
$
102

 
Discounted cash flow
 
Credit spread
 
2% - 13% (3%)
Equity securities
13

 
Market approach
 
Private offering price
 
$10 - $4,400 per share ($682)
Life settlement contracts
79

 
Discounted cash flow
 
Discount rate risk premium
 
9%
 
 
 
 
 
Mortality assumption
 
55% - 1676% (164%)
December 31, 2014
 
 
 
 
 
 
 

(In millions)
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range
 (Weighted Average)
Fixed maturity securities
$
101

 
Discounted cash flow
 
Credit spread
 
2% - 13% (3%)
Equity securities
16

 
Market approach
 
Private offering price
 
$12 - $4,391 per share ($600)
Life settlement contracts
82

 
Discounted cash flow
 
Discount rate risk premium
 
9%
 
 
 
 
 
Mortality assumption
 
55% - 1676% (163%)


For fixed maturity securities, an increase to the credit spread assumptions would result in a lower fair value measurement. For equity securities, an increase in the private offering price would result in a higher fair value measurement. For life settlement contracts, an increase in the discount rate risk premium or decrease in the mortality assumption would result in a lower fair value measurement.
Financial Assets and Liabilities Not Measured at Fair Value
The carrying amount and estimated fair value of the Company's financial assets and liabilities which are not measured at fair value on the Condensed Consolidated Balance Sheets are presented in the following tables.
March 31, 2015
Carrying
Amount
 
Estimated Fair Value
(In millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
 
 
 
 
 
 
 
 
 
Notes receivable for the issuance of common stock
$
1

 
$
—

 
$
—

 
$
1

 
$
1

Mortgage loans
586

 
—

 
—

 
612

 
612

Liabilities
 
 
 
 
 
 
 
 
 
Long term debt
$
2,560

 
$
—

 
$
2,908

 
$
—

 
$
2,908


December 31, 2014
Carrying
Amount
 
Estimated Fair Value
(In millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
 
 
 
 
 
 
 
 
 
Notes receivable for the issuance of common stock
$
1

 
$
—

 
$
—

 
$
1

 
$
1

Mortgage loans
588

 
—

 
—

 
608

 
608

Liabilities
 
 
 
 
 
 
 
 
 
Long term debt
$
2,559

 
$
—

 
$
2,883

 
$
—

 
$
2,883


The following methods and assumptions were used to estimate the fair value of these financial assets and liabilities.
The fair values of Mortgage loans were based on the present value of the expected future cash flows discounted at the current interest rate for origination of similar quality loans, adjusted for specific loan risk.
The Company's senior notes and debentures were valued based on observable market prices. The fair value for other debt was estimated using discounted cash flows based on current incremental borrowing rates for similar borrowing arrangements.
The carrying amounts reported on the Condensed Consolidated Balance Sheets for Cash, Short term investments not carried at fair value, Accrued investment income and certain Other assets and Other liabilities approximate fair value due to the short term nature of these items. These assets and liabilities are not listed in the tables above.
Claim and Claim Adjustment Expense Reserves
Claim and Claim Adjustment Expense Reserves
Note E. Claim and Claim Adjustment Expense Reserves
The Company's property and casualty insurance claim and claim adjustment expense reserves represent the estimated amounts necessary to resolve all outstanding claims, including incurred but not reported (IBNR) claims as of the reporting date. The Company's reserve projections are based primarily on detailed analysis of the facts in each case, the Company's experience with similar cases and various historical development patterns. Consideration is given to such historical patterns as field reserving trends and claims settlement practices, loss payments, pending levels of unpaid claims and product mix, as well as court decisions, economic conditions including inflation and public attitudes. All of these factors can affect the estimation of claim and claim adjustment expense reserves.
Establishing claim and claim adjustment expense reserves, including claim and claim adjustment expense reserves for catastrophic events that have occurred, is an estimation process. Many factors can ultimately affect the final settlement of a claim and, therefore, the necessary reserve. Changes in the law, results of litigation, medical costs, the cost of repair materials and labor rates can all affect ultimate claim costs. In addition, time can be a critical part of reserving determinations since the longer the span between the incidence of a loss and the payment or settlement of the claim, the more variable the ultimate settlement amount can be. Accordingly, short-tail claims, such as property damage claims, tend to be more reasonably estimable than long-tail claims, such as workers' compensation, general liability and professional liability claims. Adjustments to prior year reserve estimates, if necessary, are reflected in the results of operations in the period that the need for such adjustments is determined. There can be no assurance that the Company's ultimate cost for insurance losses will not exceed current estimates.
Catastrophes are an inherent risk of the property and casualty insurance business and have contributed to material period-to-period fluctuations in the Company's results of operations and/or equity. The Company reported catastrophe losses, net of reinsurance, of $29 million for the three months ended March 31, 2015. Catastrophe losses in 2015 related primarily to U.S. weather-related events. The Company reported catastrophe losses, net of reinsurance, of $74 million for the three months ended March 31, 2014.
The fourth quarter of 2014 asbestos and environmental pollution (A&EP) reserve review was not completed because additional information and analysis on inuring third-party reinsurance recoveries were needed to finalize the review. The review and analysis of this information continues, and the Company expects to complete the review in the second quarter of 2015. Given the significance of the information and analysis needed to finalize the remaining elements of the review, the Company is not able to estimate the impact, if any, of this uncertainty on the Company's Condensed Consolidated Financial Statements.
Net Prior Year Development
The following tables and discussion present net prior year development recorded for Specialty, Commercial, International and Corporate & Other Non-Core segments.
Three months ended March 31, 2015
 
 
 
 
 
 
 
 
 
(In millions)

Specialty
 
 Commercial
 
International
 
Corporate
& Other
Non-Core
 
Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development
$
2

 
$
(5
)
 
$
(4
)
 
$
—

 
$
(7
)
Pretax (favorable) unfavorable premium development
(6
)
 
(1
)
 
16

 
—

 
9

Total pretax (favorable) unfavorable net prior year development
$
(4
)
 
$
(6
)
 
$
12

 
$
—

 
$
2


Three months ended March 31, 2014
 
 
 
 
 
 
 
 
 
(In millions)

Specialty
 
 Commercial
 
International
 
Corporate
& Other
Non-Core
 
Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development
$
(3
)
 
$
18

 
$
10

 
$
—

 
$
25

Pretax (favorable) unfavorable premium development
(6
)
 
(18
)
 
(7
)
 
—

 
(31
)
Total pretax (favorable) unfavorable net prior year development
$
(9
)
 
$
—

 
$
3

 
$
—

 
$
(6
)

Specialty
The following table presents further detail of the net prior year claim and allocated claim adjustment expense reserve development (development) recorded for the Specialty segment.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development:
 
 
 
Medical Professional Liability
$
14

 
$
—

Other Professional Liability and Management Liability
(3
)
 
(6
)
Surety
1

 
1

Warranty
—

 
—

Other
(10
)
 
2

Total pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development
$
2

 
$
(3
)

2015
Overall, unfavorable development for medical professional liability was primarily related to increased frequency in the Aging Services book for accident years 2013 and 2014, partially offset by better than expected severity in accident years 2010 and prior.
Favorable development for other coverages was primarily due to better than expected frequency in property coverages provided to Specialty customers in accident year 2014.
2014
Favorable development for other professional liability and management liability was related to better than expected loss emergence in accident years 2004 and prior.
Commercial
The following table presents further detail of the development recorded for the Commercial segment.
Three months ended March 31



(In millions)
2015

2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development:

 
 
 
Commercial Auto
$
—

 
$
20

General Liability
4

 
—

Workers' Compensation
(1
)
 
11

Property and Other
(8
)
 
(13
)
Total pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development

$
(5
)
 
$
18


2015
Favorable development for property and other was due to lower than expected loss emergence from 2014 catastrophe events.
2014
Unfavorable development for commercial auto was primarily related to higher than expected frequency in accident years 2012 and 2013 and higher than expected loss emergence in accident years 2010 and 2011.
Unfavorable development for workers' compensation was primarily due to the recognition of losses related to favorable premium development in accident year 2013.
Favorable development for property and other was primarily due to better than expected loss emergence in catastrophe losses in accident year 2013.
International
The following table presents further detail of the development recorded for the International segment.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development:

 
 
 
Medical Professional Liability
$
—

 
$
1

Other Professional Liability
—

 
(1
)
Liability
(5
)
 
(2
)
Property & Marine
(6
)
 
8

Other
7

 
(6
)
Commutations
—

 
10

Total pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development

$
(4
)
 
$
10


2014
Reinsurance commutations in the first quarter of 2014 reduced ceded losses from prior years. Overall the commutations increased net operating income because of the release of the related allowance for uncollectible reinsurance.
Legal Proceedings and Contingent Liabilities
Legal Proceedings and Contingent Liabilities
Note F. Legal Proceedings and Contingent Liabilities
The Company is a party to routine litigation incidental to its business, which, based on the facts and circumstances currently known, is not material to the Condensed Consolidated Financial Statements.
Benefit Plans
Benefit Plans
Note G. Benefit Plans
The components of net periodic cost (benefit) are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Pension cost (benefit)
 
 
 
Service cost
$
2

 
$
3

Interest cost on projected benefit obligation
28

 
33

Expected return on plan assets
(43
)
 
(48
)
Amortization of net actuarial loss
9

 
6

Net periodic pension cost (benefit)
$
(4
)
 
$
(6
)
 
 
 
 
Postretirement cost (benefit)
 
 
 
Amortization of prior service credit
$
—

 
$
(4
)
Net periodic postretirement cost (benefit)
$
—

 
$
(4
)
Commitments, Contingencies, and Guarantees
Commitments, Contingencies, and Guarantees
Note H. Commitments, Contingencies and Guarantees
Commitments and Contingencies
The Company holds an investment in a real estate joint venture. In the normal course of business, the Company, on a joint and several basis with other unrelated insurance company shareholders, has committed to continue funding the operating deficits of this joint venture. Additionally, the Company and the other unrelated shareholders, on a joint and several basis, have guaranteed an operating lease for an office building, which expires in 2016. The guarantee of the operating lease is a parallel guarantee to the commitment to fund operating deficits; consequently, the separate guarantee to the lessor is not expected to be triggered as long as the joint venture continues to be funded by its shareholders which provide liquidity to make its annual lease payments.
In the event that the other parties to the joint venture are unable to meet their commitments in funding the operations of this joint venture, the Company would be required to assume the obligation for the entire office building operating lease. The Company does not believe it is likely that it will be required to do so.  However, as of March 31, 2015, the maximum potential future lease payments and other related costs that the Company could be required to pay under this guarantee, in excess of amounts already recorded, were approximately $41 million. If the Company were required to assume the entire lease obligation, the Company would have the right to pursue reimbursement from the other shareholders and the right to all sublease revenues.
Guarantees
As of March 31, 2015 and December 31, 2014, the Company had recorded liabilities of approximately $5 million related to guarantee and indemnification agreements and management believes that it is not likely that any future indemnity claims will be significantly greater than the amounts recorded.
In the course of selling business entities and assets to third parties, the Company agreed to guarantee the performance of certain obligations of a previously owned subsidiary and to indemnify purchasers for losses arising out of breaches of representation and warranties with respect to the business entities or assets being sold, including, in certain cases, losses arising from undisclosed liabilities or certain named litigation.  Such guarantee and indemnification agreements in effect for sales of business entities, assets and third-party loans may include provisions that survive indefinitely. As of March 31, 2015, the aggregate amount related to quantifiable guarantees was $375 million and the aggregate amount related to indemnification agreements was $324 million. Should the Company be required to make payments under the guarantee, it would have the right to seek reimbursement in certain cases from an affiliate of a previously owned subsidiary.
In addition, the Company has agreed to provide indemnification to third-party purchasers for certain losses associated with sold business entities or assets that are not limited by a contractual monetary amount. As of March 31, 2015, the Company had outstanding unlimited indemnifications in connection with the sales of certain of its business entities or assets that included tax liabilities arising prior to a purchaser's ownership of an entity or asset, defects in title at the time of sale, employee claims arising prior to closing and in some cases losses arising from certain litigation and undisclosed liabilities. Certain provisions of the indemnification agreements survive indefinitely while others survive until the applicable statutes of limitation expire or until the agreed-upon contract terms expire.
In the normal course of business, the Company also provided guarantees, if the primary obligor fails to perform, to holders of structured settlement annuities provided by a previously owned subsidiary, which are estimated to mature through 2120. The potential amount of future payments the Company could be required to pay under these guarantees was approximately $2.0 billion as of March 31, 2015. The Company does not believe a payable is likely under these guarantees, as the Company is the beneficiary of a trust that must be maintained at a level that approximates the discounted reserves for these annuities.
Accumulated Other Comprehensive Income (Loss) by Component
Accumulated Other Comprehensive Income (Loss) by Component
Note I. Accumulated Other Comprehensive Income (Loss) by Component
The following tables present the changes in Accumulated other comprehensive income (loss) by component.
(In millions)
Net unrealized gains (losses) on investments with OTTI losses
 
Net unrealized gains (losses) on other investments
 
Pension and postretirement benefits
 
Cumulative foreign currency translation adjustment
 
Total
Balance as of January 1, 2015
$
36

 
$
942

 
$
(633
)
 
$
55

 
$
400

Other comprehensive income (loss) before reclassifications
(1
)
 
121

 
—

 
(96
)
 
24

Amounts reclassified from Accumulated other comprehensive income (loss) after tax (expense) benefit of $0, $0, $3, $0 and $3
—

 
9

 
(6
)
 
—

 
3

Other comprehensive income (loss) after tax (expense) benefit of $0, $(62), $(3), $0 and $(65)
(1
)
 
112

 
6

 
(96
)
 
21

Balance as of March 31, 2015
$
35

 
$
1,054

 
$
(627
)
 
$
(41
)
 
$
421

(In millions)
Net unrealized gains (losses) on investments with OTTI losses
 
Net unrealized gains (losses) on other investments
 
Net unrealized gains (losses) on discontinued operations
 
Pension and postretirement benefits
 
Cumulative foreign currency translation adjustment
 
Total
Balance as of January 1, 2014
$
26

 
$
692

 
$
—

 
$
(426
)
 
$
150

 
$
442

Transfer to net assets held for sale
(5
)
 
(17
)
 
22

 
—

 
—

 
—

Other comprehensive income (loss) before reclassifications
12

 
264

 
8

 
—

 
(8
)
 
276

Amounts reclassified from Accumulated other comprehensive income (loss) after tax (expense) benefit of $0, $(14), $0, $1, $0 and $(13)
—

 
27

 
—

 
(1
)
 
—

 
26

Other comprehensive income (loss) after tax (expense) benefit of $(6), $(127), $(5), $(1), $0 and $(139)
12

 
237

 
8

 
1

 
(8
)
 
250

Balance as of March 31, 2014
$
33

 
$
912

 
$
30

 
$
(425
)
 
$
142

 
$
692


Amounts reclassified from Accumulated other comprehensive income (loss) shown above are reported in Net income (loss) as follows:
Component of AOCI
 
Condensed Consolidated Statements of Operations Line Item Affected by Reclassifications
Net unrealized gains (losses) on investments with OTTI losses
 
Net realized investment gains (losses)
Net unrealized gains (losses) on other investments
 
Net realized investment gains (losses)
Net unrealized gains (losses) on discontinued operations
 
Income (loss) from discontinued operations
Pension and postretirement benefits
 
Other operating expenses
Business Segments
Business Segments
Note J. Business Segments
The Company's core property and casualty commercial insurance operations are aggregated and reported in three business segments: Specialty, Commercial and International. The Company's non-core operations are managed in two segments: Life & Group Non-Core and Corporate & Other Non-Core.
The accounting policies of the segments are the same as those described in Note A to the Consolidated Financial Statements within CNAF's Annual Report on Form 10-K for the year ended December 31, 2014. The Company manages most of its assets on a legal entity basis, while segment operations are generally conducted across legal entities. As such, only Insurance and Reinsurance receivables, Insurance reserves, Deferred acquisition costs and Goodwill are readily identifiable for all individual segments. Distinct investment portfolios are not maintained for every individual segment; accordingly, allocation of assets to each segment is not performed. Therefore, a significant portion of Net investment income and Realized investment gains or losses are allocated primarily based on each segment's net carried insurance reserves, as adjusted. All significant intersegment income and expense has been eliminated. Income taxes have been allocated on the basis of the taxable income of the segments.
In the following tables, certain financial measures are presented to provide information used by management to monitor the Company's operating performance. Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio. Net operating income (loss), which is derived from certain income statement amounts, is used by management to monitor performance of the Company's insurance operations. The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk. Based on such analyses, the Company may recognize an OTTI loss on an investment security in accordance with its policy, or sell a security, which may produce realized gains and losses.
Net operating income (loss) is calculated by excluding from net income (loss) the after-tax effects of 1) net realized investment gains or losses, 2) income or loss from discontinued operations and 3) any cumulative effects of changes in accounting guidance. The calculation of net operating income excludes net realized investment gains (losses) because net realized investment gains (losses) are largely discretionary, except for some losses related to OTTI, and are generally driven by economic factors that are not necessarily consistent with key drivers of underwriting performance, and are therefore not considered an indication of trends in insurance operations.
The Company's results of continuing operations and selected balance sheet items by segment are presented in the following tables.
Three months ended March 31, 2015

Specialty
 

Commercial
 
International
 
Life &
Group
Non-Core
 
Corporate
& Other
Non-Core
 
 
 
 
(In millions)
 
 
 
 
 
Eliminations
 
Total
Operating revenues
 

 
 

 
 
 
 

 
 

 
 

 
 

Net earned premiums
$
680

 
$
678

 
$
191

 
$
138

 
$
—

 
$
—

 
$
1,687

Net investment income
155

 
204

 
14

 
179

 
6

 
—

 
558

Other revenues
78

 
9

 
—

 
9

 
2

 
(1
)
 
97

Total operating revenues
913

 
891

 
205

 
326

 
8

 
(1
)
 
2,342

Claims, Benefits and Expenses
 

 
 

 
 
 
 

 
 

 
 

 
 

Net incurred claims and benefits
429

 
454

 
116

 
340

 
(4
)
 
—

 
1,335

Policyholders’ dividends
1

 
3

 
—

 
—

 
—

 
—

 
4

Amortization of deferred acquisition costs
144

 
117

 
35

 
7

 
—

 
—

 
303

Other insurance related expenses
69

 
127

 
37

 
35

 
—

 
—

 
268

Other expenses
67

 
8

 
5

 
4

 
46

 
(1
)
 
129

Total claims, benefits and expenses
710

 
709

 
193

 
386

 
42

 
(1
)
 
2,039

Operating income (loss) before income tax
203

 
182

 
12

 
(60
)
 
(34
)
 
—

 
303

Income tax (expense) benefit on operating income (loss)
(68
)
 
(62
)
 
(3
)
 
43

 
12

 
—

 
(78
)
Net operating income (loss)
135

 
120

 
9

 
(17
)
 
(22
)
 
—

 
225

Net realized investment gains (losses)
4

 
4

 
1

 
1

 
—

 
—

 
10

Income tax (expense) benefit on net realized investment gains (losses)
(1
)
 
(3
)
 
—

 
2

 
—

 
—

 
(2
)
Net realized investment gains (losses), after tax
3

 
1

 
1

 
3

 
—

 
—

 
8

Net income (loss) from continuing operations
$
138

 
$
121

 
$
10

 
$
(14
)
 
$
(22
)
 
$
—

 
$
233




March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Reinsurance receivables
$
671

 
$
675

 
$
207

 
$
543

 
$
2,672

 
$
—

 
$
4,768

Insurance receivables
808

 
1,004

 
282

 
13

 
2

 
—

 
2,109

Deferred acquisition costs
307

 
225

 
84

 
—

 
—

 
—

 
616

Goodwill
117

 
—

 
34

 
—

 
—

 
—

 
151

Insurance reserves
 
 
 
 
 
 
 
 
 
 
 
 
 

Claim and claim adjustment expenses
6,352

 
9,441

 
1,377

 
3,237

 
2,841

 
—

 
23,248

Unearned premiums
1,794

 
1,329

 
449

 
139

 
—

 
(1
)
 
3,710

Future policy benefits
—

 
—

 
—

 
9,747

 
—

 
—

 
9,747

Three months ended March 31, 2014

Specialty
 

Commercial
 
International
 
Life &
Group
Non-Core
 
Corporate
& Other
Non-Core
 
 
 
 
(In millions)
 
 
 
 
Eliminations
 
Total
Operating revenues
 

 
 

 
 
 
 

 
 

 
 

 
 

Net earned premiums
$
692

 
$
735

 
$
241

 
$
139

 
$
—

 
$
(1
)
 
$
1,806

Net investment income
144

 
191

 
15

 
171

 
5

 
—

 
526

Other revenues
68

 
10

 
—

 
5

 
2

 
—

 
85

Total operating revenues
904

 
936

 
256

 
315

 
7

 
(1
)
 
2,417

Claims, Benefits and Expenses
 

 
 
 
 
 
 

 
 

 
 

 
 

Net incurred claims and benefits
442

 
568

 
130

 
306

 
(3
)
 
—

 
1,443

Policyholders’ dividends
1

 
2

 
—

 
—

 
—

 
—

 
3

Amortization of deferred acquisition costs
143

 
123

 
55

 
8

 
—

 
—

 
329

Other insurance related expenses
65

 
126

 
40

 
32

 
—

 
(1
)
 
262

Other expenses
61

 
8

 
7

 
1

 
51

 
—

 
128

Total claims, benefits and expenses
712

 
827

 
232

 
347

 
48

 
(1
)
 
2,165

Operating income (loss) before income tax
192

 
109

 
24

 
(32
)
 
(41
)
 
—

 
252

Income tax (expense) benefit on operating income (loss)
(63
)
 
(35
)
 
(8
)
 
30

 
14

 
—

 
(62
)
Net operating income (loss)
129

 
74

 
16

 
(2
)
 
(27
)
 
—

 
190

Net realized investment gains (losses)
11

 
10

 
3

 
16

 
6

 
—

 
46

Income tax (expense) benefit on net realized investment gains (losses)
(3
)
 
(2
)
 
(3
)
 
(6
)
 
(2
)
 
—

 
(16
)
Net realized investment gains (losses), after tax
8

 
8

 
—

 
10

 
4

 
—

 
30

Net income (loss) from continuing operations
$
137

 
$
82

 
$
16

 
$
8

 
$
(23
)
 
$
—

 
$
220




December 31, 2014
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Reinsurance receivables
$
567

 
$
690

 
$
207

 
$
525

 
$
2,753

 
$
—

 
$
4,742

Insurance receivables
778

 
954

 
250

 
13

 
2

 
—

 
1,997

Deferred acquisition costs
304

 
213

 
83

 
—

 
—

 
—

 
600

Goodwill
117

 
—

 
35

 
—

 
—

 
—

 
152

Insurance reserves
 
 
 
 
 
 
 
 
 
 
 
 
 

Claim and claim adjustment expenses
6,229

 
9,514

 
1,441

 
3,183

 
2,904

 
—

 
23,271

Unearned premiums
1,763

 
1,273

 
431

 
125

 
—

 
—

 
3,592

Future policy benefits
—

 
—

 
—

 
9,490

 
—

 
—

 
9,490

Policyholders’ funds
9

 
18

 
—

 
—

 
—

 
—

 
27

The following table presents revenue by line of business for each reportable segment. Revenues are comprised of Operating revenues and Net realized investment gains and losses.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Specialty
 
 
 
Management & Professional Liability
$
697

 
$
704

Surety
120

 
122

Warranty & Alternative Risks
100

 
89

Specialty revenues
917

 
915

Commercial
 

 
 

Middle Market
409

 
403

Small Business
165

 
184

Other Commercial Insurance
321

 
359

Commercial revenues
895

 
946

International


 


Canada
55

 
71

CNA Europe
77

 
88

Hardy
74

 
100

International revenues
206

 
259

Life & Group Non-Core revenues
327

 
331

Corporate & Other Non-Core revenues
8

 
13

Eliminations
(1
)
 
(1
)
Total revenues
$
2,352

 
$
2,463

Discontinued Operations
Discontinued Operations
Note K. Discontinued Operations
The results of discontinued operations reflected in the Condensed Consolidated Statements of Operations are presented in the following table.
Three months ended March 31
 
(In millions)
2014
Revenues
 
Net investment income
$
41

Net realized investment gains
1

Total revenues
42

Claims, Benefits and Expenses
 
Insurance claims and policyholders' benefits
31

Other operating expenses
1

Total claims, benefits and expenses
32

Income before income tax
10

Income tax expense
(3
)
Income from operations of discontinued operations, net of income tax
7

Impairment loss on sale, net of income tax benefit of $41
(214
)
Loss from discontinued operations
$
(207
)
Investments (Tables)
Net investment income 
The significant components of Net investment income are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Fixed maturity securities
$
443

 
$
452

Short term investments
2

 
1

Limited partnership investments
114

 
73

Equity securities
3

 
2

Mortgage loans
8

 
6

Trading portfolio
2

 
3

Other
—

 
2

Gross investment income
572

 
539

Investment expense
(14
)
 
(13
)
Net investment income
$
558

 
$
526

Net realized investment gains (losses) 
Net realized investment gains (losses) are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Net realized investment gains (losses):
 
 
 
Fixed maturity securities:
 
 
 
Gross realized gains
$
33

 
$
53

Gross realized losses
(21
)
 
(15
)
Net realized investment gains (losses) on fixed maturity securities
12

 
38

Equity securities:
 
 
 

Gross realized gains
1

 
5

Gross realized losses
(1
)
 
—

Net realized investment gains (losses) on equity securities
—

 
5

Derivatives
(1
)
 
—

Short term investments and other
(1
)
 
3

Net realized investment gains (losses)
$
10

 
$
46

Components of Net other-than-temporary impairment losses recognized in earnings by asset type 
The components of Net other-than-temporary impairment (OTTI) losses recognized in earnings by asset type are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Fixed maturity securities available-for-sale:
 
 
 
Corporate and other bonds
$
5

 
$
1

States, municipalities and political subdivisions
5

 
—

Asset-backed - residential mortgage-backed
1

 
1

Total fixed maturity securities available-for-sale
11

 
2

Equity securities available-for-sale:
 
 
 
Common stock
1

 
—

Net OTTI losses recognized in earnings
$
12

 
$
2

Summary of fixed maturity and equity securities 
The following tables present a summary of fixed maturity and equity securities.
March 31, 2015
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair
Value
 
Unrealized
OTTI
Losses (Gains)
(In millions)
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
16,721

 
$
1,867

 
$
43

 
$
18,545

 
$
—

States, municipalities and political subdivisions
11,407

 
1,536

 
9

 
12,934

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
4,998

 
241

 
13

 
5,226

 
(51
)
Commercial mortgage-backed
2,151

 
114

 
5

 
2,260

 
(3
)
Other asset-backed
1,109

 
15

 
1

 
1,123

 
—

Total asset-backed
8,258

 
370

 
19

 
8,609

 
(54
)
U.S. Treasury and obligations of government-sponsored enterprises
24

 
6

 
—

 
30

 
—

Foreign government
390

 
19

 
—

 
409

 
—

Redeemable preferred stock
39

 
3

 
—

 
42

 
—

Total fixed maturity securities available-for-sale
36,839

 
3,801

 
71

 
40,569

 
$
(54
)
Total fixed maturity securities trading
36

 


 


 
36

 
 
Equity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Common stock
41

 
9

 
—

 
50

 
 
Preferred stock
172

 
7

 
4

 
175

 
 
Total equity securities available-for-sale
213

 
16

 
4

 
225

 
 
Total
$
37,088

 
$
3,817

 
$
75

 
$
40,830

 
 

December 31, 2014
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair
Value
 
Unrealized
OTTI
Losses (Gains)
(In millions)
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
17,210

 
$
1,721

 
$
61

 
$
18,870

 
$
—

States, municipalities and political subdivisions
11,285

 
1,463

 
8

 
12,740

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
5,028

 
218

 
13

 
5,233

 
(53
)
Commercial mortgage-backed
2,056

 
93

 
5

 
2,144

 
(2
)
Other asset-backed
1,234

 
11

 
10

 
1,235

 
—

Total asset-backed
8,318

 
322

 
28

 
8,612

 
(55
)
U.S. Treasury and obligations of government-sponsored enterprises
26

 
5

 
—

 
31

 
—

Foreign government
438

 
16

 
—

 
454

 
—

Redeemable preferred stock
39

 
3

 
—

 
42

 
—

Total fixed maturity securities available-for-sale
37,316

 
3,530

 
97

 
40,749

 
$
(55
)
Total fixed maturity securities trading
19

 


 


 
19

 
 
Equity securities available-for-sale:
 
 
 
 
 
 
 
 
 
Common stock
38

 
9

 
—

 
47

 
 
Preferred stock
172

 
5

 
2

 
175

 
 
Total equity securities available-for-sale
210

 
14

 
2

 
222

 
 
Total
$
37,545

 
$
3,544

 
$
99

 
$
40,990

 
 
Securities in a gross unrealized loss position 
The following tables present the estimated fair value and gross unrealized losses of fixed maturity and equity securities in a gross unrealized loss position by the length of time in which the securities have continuously been in that position.
 
Less than 12 Months
 
12 Months or Longer
 
Total
March 31, 2015
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
(In millions)
 
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
840

 
$
31

 
$
139

 
$
12

 
$
979

 
$
43

States, municipalities and political subdivisions
479

 
6

 
100

 
3

 
579

 
9

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
318

 
5

 
148

 
8

 
466

 
13

Commercial mortgage-backed
175

 
3

 
62

 
2

 
237

 
5

Other asset-backed
187

 
1

 
5

 
—

 
192

 
1

Total asset-backed
680

 
9

 
215

 
10

 
895

 
19

U.S. Treasury and obligations of government-sponsored enterprises
3

 
—

 
—

 
—

 
3

 
—

Foreign government
13

 
—

 
1

 
—

 
14

 
—

Total fixed maturity securities available-for-sale
2,015

 
46

 
455

 
25

 
2,470

 
71

Equity securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
Preferred stock
15

 
4

 
—

 
—

 
15

 
4

Total
$
2,030

 
$
50

 
$
455

 
$
25

 
$
2,485

 
$
75


 
Less than 12 Months
 
12 Months or Longer
 
Total
December 31, 2014
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Gross
Unrealized
Losses
(In millions)
 
 
 
 
 
Fixed maturity securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
1,330

 
$
46

 
$
277

 
$
15

 
$
1,607

 
$
61

States, municipalities and political subdivisions
335

 
5

 
127

 
3

 
462

 
8

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
293

 
5

 
189

 
8

 
482

 
13

Commercial mortgage-backed
264

 
2

 
99

 
3

 
363

 
5

Other asset-backed
607

 
10

 
7

 
—

 
614

 
10

Total asset-backed
1,164

 
17

 
295

 
11

 
1,459

 
28

U.S. Treasury and obligations of government-sponsored enterprises
3

 
—

 
4

 
—

 
7

 
—

   Foreign government
3

 
—

 
3

 
—

 
6

 
—

Redeemable preferred stock
3

 
—

 
—

 
—

 
3

 
—

Total fixed maturity securities available-for-sale
2,838

 
68

 
706

 
29

 
3,544

 
97

Equity securities available-for-sale:


 


 


 


 


 


   Preferred stock
17

 
2

 
1

 
—

 
18

 
2

Total
$
2,855

 
$
70

 
$
707

 
$
29

 
$
3,562

 
$
99

Activity related to the pretax fixed maturity credit loss component reflected within retained earnings for securities still held for which a portion of an OTTI loss was recognized in OCI 
The following table presents the activity related to the pretax credit loss component reflected in Retained earnings on fixed maturity securities still held as of March 31, 2015 and 2014 for which a portion of an OTTI loss was recognized in Other comprehensive income.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Beginning balance of credit losses on fixed maturity securities
$
62

 
$
74

Reductions for securities sold during the period
(1
)
 
(2
)
Reductions for securities the Company intends to sell or more likely than not will be required to sell
—

 
(3
)
Ending balance of credit losses on fixed maturity securities
$
61

 
$
69

Contractual maturity 
The following table presents available-for-sale fixed maturity securities by contractual maturity.
 
March 31, 2015
 
December 31, 2014
(In millions)
Cost or
Amortized
Cost
 
Estimated
Fair
Value
 
Cost or
Amortized
Cost
 
Estimated
Fair
Value
Due in one year or less
$
2,011

 
$
2,043

 
$
2,479

 
$
2,511

Due after one year through five years
8,760

 
9,340

 
9,054

 
9,605

Due after five years through ten years
12,401

 
13,108

 
12,055

 
12,584

Due after ten years
13,667

 
16,078

 
13,728

 
16,049

Total
$
36,839

 
$
40,569

 
$
37,316

 
$
40,749

Summary of aggregate contractual or notional amounts and gross estimated fair values related to derivative financial instruments 
The following tables present the aggregate contractual or notional amounts and estimated fair values related to derivative financial instruments.
March 31, 2015
Contractual/
Notional
Amount
 
Estimated Fair Value
(In millions)
 
Asset
 
Liability
Without hedge designation
 
 
 
 
 
Currency forwards
$
18

 
$
2

 
$
—

Equity warrants
5

 
—

 
—

Embedded derivative on funds withheld liability
184

 
—

 
5

Total
 
 
$
2

 
$
5


December 31, 2014
Contractual/
Notional
Amount
 
Estimated Fair Value
(In millions)
 
Asset
 
Liability
Without hedge designation
 
 
 
 
 
Currency forwards
$
9

 
$
—

 
$
—

Equity warrants
5

 
—

 
—

Embedded derivative on funds withheld liability
184

 
—

 
3

Total
 
 
$
—

 
$
3

Fair Value (Tables)
Assets and liabilities measured at fair value on a recurring basis 
Assets and liabilities measured at fair value on a recurring basis are presented in the following tables.
March 31, 2015
 
 
 
 
 
 
Total
Assets/ Liabilities
at Fair Value
(In millions)
Level 1
 
Level 2
 
Level 3
 
Assets
 
 
 
 
 
 
 
Fixed maturity securities:
 
 
 
 
 
 
 
Corporate and other bonds
$
29

 
$
18,337

 
$
186

 
$
18,552

States, municipalities and political subdivisions
—

 
12,877

 
86

 
12,963

Asset-backed:
 
 
 
 
 
 
 
Residential mortgage-backed
—

 
4,994

 
232

 
5,226

Commercial mortgage-backed
—

 
2,196

 
64

 
2,260

Other asset-backed
—

 
570

 
553

 
1,123

Total asset-backed
—

 
7,760

 
849

 
8,609

U.S. Treasury and obligations of government-sponsored enterprises
29

 
1

 
—

 
30

Foreign government
37

 
372

 
—

 
409

Redeemable preferred stock
30

 
12

 
—

 
42

Total fixed maturity securities
125

 
39,359

 
1,121

 
40,605

Equity securities
149

 
63

 
13

 
225

Derivative financial instruments
—

 
2

 
—

 
2

Other invested assets, excluding derivative financial instruments
—

 
41

 
—

 
41

Short term investments
742

 
678

 
—

 
1,420

Life settlement contracts, included in Other assets
—

 
—

 
79

 
79

Total assets
$
1,016

 
$
40,143

 
$
1,213

 
$
42,372

Liabilities
 
 
 
 
 

 
 

Other liabilities
$
—

 
$
5

 
$
—

 
$
5

Total liabilities
$
—

 
$
5

 
$
—

 
$
5

December 31, 2014
 
 
 
 
 
 
Total
Assets/Liabilities
at Fair Value
(In millions)
Level 1
 
Level 2
 
Level 3
 
Assets
 
 
 
 
 
 
 
Fixed maturity securities:
 
 
 
 
 
 
 
Corporate and other bonds
$
32

 
$
18,695

 
$
162

 
$
18,889

States, municipalities and political subdivisions
—

 
12,646

 
94

 
12,740

Asset-backed:
 
 
 
 
 
 
 

Residential mortgage-backed
—

 
5,044

 
189

 
5,233

Commercial mortgage-backed
—

 
2,061

 
83

 
2,144

Other asset-backed
—

 
580

 
655

 
1,235

Total asset-backed
—

 
7,685

 
927

 
8,612

U.S. Treasury and obligations of government-sponsored enterprises
28

 
3

 
—

 
31

Foreign government
41

 
413

 
—

 
454

Redeemable preferred stock
30

 
12

 
—

 
42

Total fixed maturity securities
131

 
39,454

 
1,183

 
40,768

Equity securities
145

 
61

 
16

 
222

Other invested assets
—

 
41

 
—

 
41

Short term investments
681

 
963

 
—

 
1,644

Life settlement contracts, included in Other assets
—

 
—

 
82

 
82

Total assets
$
957

 
$
40,519

 
$
1,281

 
$
42,757

Liabilities
 
 
 
 
 
 
 
Other liabilities
$
—

 
$
3

 
$
—

 
$
3

Total liabilities
$
—

 
$
3

 
$
—

 
$
3

Table of reconciliation for assets and liablities measured at fair value on a recurring basis using significant unobservable inputs 
The following tables present a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).
Level 3
(In millions)
Balance as of
January 1,
2015
 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in Net income (loss)
 
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)
 
Purchases
 
Sales
 
Settlements
 
Transfers into
Level 3
 
Transfers out
of Level 3
 
Balance as of
March 31,
2015
 
Unrealized gains (losses) on Level 3 assets and liabilities held as of March 31, 2015 recognized in Net income (loss)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
162

 
$
1

 
$
—

 
$
12

 
$
(12
)
 
$
(14
)
 
$
37

 
$
—

 
$
186

 
$
—

States, municipalities and political subdivisions
94

 
1

 
—

 
—

 
—

 
(9
)
 
—

 
—

 
86

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
Residential mortgage-backed
189

 
1

 
—

 
72

 
—

 
(10
)
 
—

 
(20
)
 
232

 
—

Commercial mortgage-backed
83

 
1

 
1

 
6

 
—

 
(1
)
 
—

 
(26
)
 
64

 
—

Other asset-backed
655

 
1

 
9

 
35

 
(144
)
 
(3
)
 
—

 
—

 
553

 
—

Total asset-backed
927

 
3

 
10

 
113

 
(144
)
 
(14
)
 
—

 
(46
)
 
849

 
—

Total fixed maturity securities
1,183

 
5

 
10

 
125

 
(156
)
 
(37
)
 
37

 
(46
)
 
1,121

 
—

Equity securities
16

 
—

 
(3
)
 
—

 
—

 
—

 
—

 
—

 
13

 
—

Life settlement contracts
82

 
13

 
—

 
—

 
—

 
(16
)
 
—

 
—

 
79

 
1

Total
$
1,281

 
$
18

 
$
7

 
$
125

 
$
(156
)
 
$
(53
)
 
$
37

 
$
(46
)
 
$
1,213

 
$
1


Level 3
(In millions)
Balance as of
January 1,
2014
 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in Net income (loss)
 
Net change in unrealized appreciation (depreciation) included in Other comprehensive income (loss)
 
Purchases
 
Sales
 
Settlements
 
Transfers into
Level 3
 
Transfers out
of Level 3
 
Balance as of
March 31, 2014
 
Unrealized gains (losses) on Level 3 assets and liabilities held as of March 31, 2014 recognized in Net income (loss)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
204

 
$
1

 
$
1

 
$
5

 
$
(4
)
 
$
(5
)
 
$
3

 
$
(16
)
 
$
189

 
$
—

States, municipalities and political subdivisions
71

 
—

 
1

 
—

 
—

 
—

 
14

 
—

 
86

 
—

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed
331

 
1

 
15

 
25

 
—

 
(21
)
 
21

 
(13
)
 
359

 
—

Commercial mortgage-backed
151

 
1

 
(1
)
 
—

 
—

 
(1
)
 
—

 
(24
)
 
126

 
—

Other asset-backed
446

 
1

 
—

 
148

 
(83
)
 
(72
)
 
—

 
(1
)
 
439

 
—

Total asset-backed
928

 
3

 
14

 
173

 
(83
)
 
(94
)
 
21

 
(38
)
 
924

 
—

Total fixed maturity securities
1,203

 
4

 
16

 
178

 
(87
)
 
(99
)
 
38

 
(54
)
 
1,199

 
—

Equity securities
11

 
3

 
(4
)
 
—

 
(8
)
 
—

 
—

 
—

 
2

 
—

Life settlement contracts
88

 
10

 
—

 
—

 
—

 
(11
)
 
—

 
—

 
87

 
1

Separate account business
1

 
—

 
—

 
—

 
—

 
—

 
—

 
(1
)
 
—

 
—

Total
$
1,303

 
$
17

 
$
12

 
$
178

 
$
(95
)
 
$
(110
)
 
$
38

 
$
(55
)
 
$
1,288

 
$
1

Quantitative information about significant unobservable inputs in the fair value measurement of level 3 assets 
The following tables present quantitative information about the significant unobservable inputs utilized by the Company in the fair value measurements of Level 3 assets. Valuations for assets and liabilities not presented in the table below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company.
March 31, 2015
 
 
 
 
 
 
 

(In millions)
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range
 (Weighted Average)
Fixed maturity securities
$
102

 
Discounted cash flow
 
Credit spread
 
2% - 13% (3%)
Equity securities
13

 
Market approach
 
Private offering price
 
$10 - $4,400 per share ($682)
Life settlement contracts
79

 
Discounted cash flow
 
Discount rate risk premium
 
9%
 
 
 
 
 
Mortality assumption
 
55% - 1676% (164%)
December 31, 2014
 
 
 
 
 
 
 

(In millions)
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range
 (Weighted Average)
Fixed maturity securities
$
101

 
Discounted cash flow
 
Credit spread
 
2% - 13% (3%)
Equity securities
16

 
Market approach
 
Private offering price
 
$12 - $4,391 per share ($600)
Life settlement contracts
82

 
Discounted cash flow
 
Discount rate risk premium
 
9%
 
 
 
 
 
Mortality assumption
 
55% - 1676% (163%)
Carrying amount and estimated fair value of financial instrument assets and liabilities not measured at fair value 
The carrying amount and estimated fair value of the Company's financial assets and liabilities which are not measured at fair value on the Condensed Consolidated Balance Sheets are presented in the following tables.
March 31, 2015
Carrying
Amount
 
Estimated Fair Value
(In millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
 
 
 
 
 
 
 
 
 
Notes receivable for the issuance of common stock
$
1

 
$
—

 
$
—

 
$
1

 
$
1

Mortgage loans
586

 
—

 
—

 
612

 
612

Liabilities
 
 
 
 
 
 
 
 
 
Long term debt
$
2,560

 
$
—

 
$
2,908

 
$
—

 
$
2,908


December 31, 2014
Carrying
Amount
 
Estimated Fair Value
(In millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
 
 
 
 
 
 
 
 
 
Notes receivable for the issuance of common stock
$
1

 
$
—

 
$
—

 
$
1

 
$
1

Mortgage loans
588

 
—

 
—

 
608

 
608

Liabilities
 
 
 
 
 
 
 
 
 
Long term debt
$
2,559

 
$
—

 
$
2,883

 
$
—

 
$
2,883

Claim and Claim Adjustment Expense Reserves (Tables)
Net prior year development 
The following tables and discussion present net prior year development recorded for Specialty, Commercial, International and Corporate & Other Non-Core segments.
Three months ended March 31, 2015
 
 
 
 
 
 
 
 
 
(In millions)

Specialty
 
 Commercial
 
International
 
Corporate
& Other
Non-Core
 
Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development
$
2

 
$
(5
)
 
$
(4
)
 
$
—

 
$
(7
)
Pretax (favorable) unfavorable premium development
(6
)
 
(1
)
 
16

 
—

 
9

Total pretax (favorable) unfavorable net prior year development
$
(4
)
 
$
(6
)
 
$
12

 
$
—

 
$
2


Three months ended March 31, 2014
 
 
 
 
 
 
 
 
 
(In millions)

Specialty
 
 Commercial
 
International
 
Corporate
& Other
Non-Core
 
Total
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development
$
(3
)
 
$
18

 
$
10

 
$
—

 
$
25

Pretax (favorable) unfavorable premium development
(6
)
 
(18
)
 
(7
)
 
—

 
(31
)
Total pretax (favorable) unfavorable net prior year development
$
(9
)
 
$
—

 
$
3

 
$
—

 
$
(6
)
Net prior year claim and allocated claim adjustment expense reserve development for Specialty segment 
The following table presents further detail of the net prior year claim and allocated claim adjustment expense reserve development (development) recorded for the Specialty segment.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development:
 
 
 
Medical Professional Liability
$
14

 
$
—

Other Professional Liability and Management Liability
(3
)
 
(6
)
Surety
1

 
1

Warranty
—

 
—

Other
(10
)
 
2

Total pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development
$
2

 
$
(3
)
Net prior year claim and allocated claim adjustment expense reserve development for Commercial segment 
The following table presents further detail of the development recorded for the Commercial segment.
Three months ended March 31



(In millions)
2015

2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development:

 
 
 
Commercial Auto
$
—

 
$
20

General Liability
4

 
—

Workers' Compensation
(1
)
 
11

Property and Other
(8
)
 
(13
)
Total pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development

$
(5
)
 
$
18

Net prior year claim and allocated claim adjustment expense reserve development for International segment 
The following table presents further detail of the development recorded for the International segment.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development:

 
 
 
Medical Professional Liability
$
—

 
$
1

Other Professional Liability
—

 
(1
)
Liability
(5
)
 
(2
)
Property & Marine
(6
)
 
8

Other
7

 
(6
)
Commutations
—

 
10

Total pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development

$
(4
)
 
$
10

Benefit Plans (Tables)
Components of net periodic cost (benefit)
The components of net periodic cost (benefit) are presented in the following table.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Pension cost (benefit)
 
 
 
Service cost
$
2

 
$
3

Interest cost on projected benefit obligation
28

 
33

Expected return on plan assets
(43
)
 
(48
)
Amortization of net actuarial loss
9

 
6

Net periodic pension cost (benefit)
$
(4
)
 
$
(6
)
 
 
 
 
Postretirement cost (benefit)
 
 
 
Amortization of prior service credit
$
—

 
$
(4
)
Net periodic postretirement cost (benefit)
$
—

 
$
(4
)
Accumulated Other Comprehensive Income (Loss) by Component (Tables)
Accumulated Other Comprehensive Income (Loss) by Component
The following tables present the changes in Accumulated other comprehensive income (loss) by component.
(In millions)
Net unrealized gains (losses) on investments with OTTI losses
 
Net unrealized gains (losses) on other investments
 
Pension and postretirement benefits
 
Cumulative foreign currency translation adjustment
 
Total
Balance as of January 1, 2015
$
36

 
$
942

 
$
(633
)
 
$
55

 
$
400

Other comprehensive income (loss) before reclassifications
(1
)
 
121

 
—

 
(96
)
 
24

Amounts reclassified from Accumulated other comprehensive income (loss) after tax (expense) benefit of $0, $0, $3, $0 and $3
—

 
9

 
(6
)
 
—

 
3

Other comprehensive income (loss) after tax (expense) benefit of $0, $(62), $(3), $0 and $(65)
(1
)
 
112

 
6

 
(96
)
 
21

Balance as of March 31, 2015
$
35

 
$
1,054

 
$
(627
)
 
$
(41
)
 
$
421

(In millions)
Net unrealized gains (losses) on investments with OTTI losses
 
Net unrealized gains (losses) on other investments
 
Net unrealized gains (losses) on discontinued operations
 
Pension and postretirement benefits
 
Cumulative foreign currency translation adjustment
 
Total
Balance as of January 1, 2014
$
26

 
$
692

 
$
—

 
$
(426
)
 
$
150

 
$
442

Transfer to net assets held for sale
(5
)
 
(17
)
 
22

 
—

 
—

 
—

Other comprehensive income (loss) before reclassifications
12

 
264

 
8

 
—

 
(8
)
 
276

Amounts reclassified from Accumulated other comprehensive income (loss) after tax (expense) benefit of $0, $(14), $0, $1, $0 and $(13)
—

 
27

 
—

 
(1
)
 
—

 
26

Other comprehensive income (loss) after tax (expense) benefit of $(6), $(127), $(5), $(1), $0 and $(139)
12

 
237

 
8

 
1

 
(8
)
 
250

Balance as of March 31, 2014
$
33

 
$
912

 
$
30

 
$
(425
)
 
$
142

 
$
692

Business Segments (Tables)
Significant components of the Company's continuing operations and selected balance sheet items 
Three months ended March 31, 2015

Specialty
 

Commercial
 
International
 
Life &
Group
Non-Core
 
Corporate
& Other
Non-Core
 
 
 
 
(In millions)
 
 
 
 
 
Eliminations
 
Total
Operating revenues
 

 
 

 
 
 
 

 
 

 
 

 
 

Net earned premiums
$
680

 
$
678

 
$
191

 
$
138

 
$
—

 
$
—

 
$
1,687

Net investment income
155

 
204

 
14

 
179

 
6

 
—

 
558

Other revenues
78

 
9

 
—

 
9

 
2

 
(1
)
 
97

Total operating revenues
913

 
891

 
205

 
326

 
8

 
(1
)
 
2,342

Claims, Benefits and Expenses
 

 
 

 
 
 
 

 
 

 
 

 
 

Net incurred claims and benefits
429

 
454

 
116

 
340

 
(4
)
 
—

 
1,335

Policyholders’ dividends
1

 
3

 
—

 
—

 
—

 
—

 
4

Amortization of deferred acquisition costs
144

 
117

 
35

 
7

 
—

 
—

 
303

Other insurance related expenses
69

 
127

 
37

 
35

 
—

 
—

 
268

Other expenses
67

 
8

 
5

 
4

 
46

 
(1
)
 
129

Total claims, benefits and expenses
710

 
709

 
193

 
386

 
42

 
(1
)
 
2,039

Operating income (loss) before income tax
203

 
182

 
12

 
(60
)
 
(34
)
 
—

 
303

Income tax (expense) benefit on operating income (loss)
(68
)
 
(62
)
 
(3
)
 
43

 
12

 
—

 
(78
)
Net operating income (loss)
135

 
120

 
9

 
(17
)
 
(22
)
 
—

 
225

Net realized investment gains (losses)
4

 
4

 
1

 
1

 
—

 
—

 
10

Income tax (expense) benefit on net realized investment gains (losses)
(1
)
 
(3
)
 
—

 
2

 
—

 
—

 
(2
)
Net realized investment gains (losses), after tax
3

 
1

 
1

 
3

 
—

 
—

 
8

Net income (loss) from continuing operations
$
138

 
$
121

 
$
10

 
$
(14
)
 
$
(22
)
 
$
—

 
$
233




March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Reinsurance receivables
$
671

 
$
675

 
$
207

 
$
543

 
$
2,672

 
$
—

 
$
4,768

Insurance receivables
808

 
1,004

 
282

 
13

 
2

 
—

 
2,109

Deferred acquisition costs
307

 
225

 
84

 
—

 
—

 
—

 
616

Goodwill
117

 
—

 
34

 
—

 
—

 
—

 
151

Insurance reserves
 
 
 
 
 
 
 
 
 
 
 
 
 

Claim and claim adjustment expenses
6,352

 
9,441

 
1,377

 
3,237

 
2,841

 
—

 
23,248

Unearned premiums
1,794

 
1,329

 
449

 
139

 
—

 
(1
)
 
3,710

Future policy benefits
—

 
—

 
—

 
9,747

 
—

 
—

 
9,747

Three months ended March 31, 2014

Specialty
 

Commercial
 
International
 
Life &
Group
Non-Core
 
Corporate
& Other
Non-Core
 
 
 
 
(In millions)
 
 
 
 
Eliminations
 
Total
Operating revenues
 

 
 

 
 
 
 

 
 

 
 

 
 

Net earned premiums
$
692

 
$
735

 
$
241

 
$
139

 
$
—

 
$
(1
)
 
$
1,806

Net investment income
144

 
191

 
15

 
171

 
5

 
—

 
526

Other revenues
68

 
10

 
—

 
5

 
2

 
—

 
85

Total operating revenues
904

 
936

 
256

 
315

 
7

 
(1
)
 
2,417

Claims, Benefits and Expenses
 

 
 
 
 
 
 

 
 

 
 

 
 

Net incurred claims and benefits
442

 
568

 
130

 
306

 
(3
)
 
—

 
1,443

Policyholders’ dividends
1

 
2

 
—

 
—

 
—

 
—

 
3

Amortization of deferred acquisition costs
143

 
123

 
55

 
8

 
—

 
—

 
329

Other insurance related expenses
65

 
126

 
40

 
32

 
—

 
(1
)
 
262

Other expenses
61

 
8

 
7

 
1

 
51

 
—

 
128

Total claims, benefits and expenses
712

 
827

 
232

 
347

 
48

 
(1
)
 
2,165

Operating income (loss) before income tax
192

 
109

 
24

 
(32
)
 
(41
)
 
—

 
252

Income tax (expense) benefit on operating income (loss)
(63
)
 
(35
)
 
(8
)
 
30

 
14

 
—

 
(62
)
Net operating income (loss)
129

 
74

 
16

 
(2
)
 
(27
)
 
—

 
190

Net realized investment gains (losses)
11

 
10

 
3

 
16

 
6

 
—

 
46

Income tax (expense) benefit on net realized investment gains (losses)
(3
)
 
(2
)
 
(3
)
 
(6
)
 
(2
)
 
—

 
(16
)
Net realized investment gains (losses), after tax
8

 
8

 
—

 
10

 
4

 
—

 
30

Net income (loss) from continuing operations
$
137

 
$
82

 
$
16

 
$
8

 
$
(23
)
 
$
—

 
$
220




December 31, 2014
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
Reinsurance receivables
$
567

 
$
690

 
$
207

 
$
525

 
$
2,753

 
$
—

 
$
4,742

Insurance receivables
778

 
954

 
250

 
13

 
2

 
—

 
1,997

Deferred acquisition costs
304

 
213

 
83

 
—

 
—

 
—

 
600

Goodwill
117

 
—

 
35

 
—

 
—

 
—

 
152

Insurance reserves
 
 
 
 
 
 
 
 
 
 
 
 
 

Claim and claim adjustment expenses
6,229

 
9,514

 
1,441

 
3,183

 
2,904

 
—

 
23,271

Unearned premiums
1,763

 
1,273

 
431

 
125

 
—

 
—

 
3,592

Future policy benefits
—

 
—

 
—

 
9,490

 
—

 
—

 
9,490

Policyholders’ funds
9

 
18

 
—

 
—

 
—

 
—

 
27



Revenues by line of business 
The following table presents revenue by line of business for each reportable segment. Revenues are comprised of Operating revenues and Net realized investment gains and losses.
Three months ended March 31
 
 
 
(In millions)
2015
 
2014
Specialty
 
 
 
Management & Professional Liability
$
697

 
$
704

Surety
120

 
122

Warranty & Alternative Risks
100

 
89

Specialty revenues
917

 
915

Commercial
 

 
 

Middle Market
409

 
403

Small Business
165

 
184

Other Commercial Insurance
321

 
359

Commercial revenues
895

 
946

International


 


Canada
55

 
71

CNA Europe
77

 
88

Hardy
74

 
100

International revenues
206

 
259

Life & Group Non-Core revenues
327

 
331

Corporate & Other Non-Core revenues
8

 
13

Eliminations
(1
)
 
(1
)
Total revenues
$
2,352

 
$
2,463

Discontinued Operations (Tables)
Results of discontinued operations
The results of discontinued operations reflected in the Condensed Consolidated Statements of Operations are presented in the following table.
Three months ended March 31
 
(In millions)
2014
Revenues
 
Net investment income
$
41

Net realized investment gains
1

Total revenues
42

Claims, Benefits and Expenses
 
Insurance claims and policyholders' benefits
31

Other operating expenses
1

Total claims, benefits and expenses
32

Income before income tax
10

Income tax expense
(3
)
Income from operations of discontinued operations, net of income tax
7

Impairment loss on sale, net of income tax benefit of $41
(214
)
Loss from discontinued operations
$
(207
)
General General (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]
 
Discontinued Operation, Provision for Loss (Gain) on Disposal, Net of Tax
$ 214 
Earnings Per Share (Narrative) (Details)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Earnings Per Share [Abstract]
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
182 
110 
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements
654 
660 
Investments (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Investments [Abstract]
 
 
Reduction of net unrealized gains on investments included in AOCI due to shadow adjustments
$ 1,370 
$ 1,288 
Future capital call commitments for limited partnership investments
338 
 
Mortgage loan commitments
41 
 
Commitments to purchase or fund privately placed debt securities
82 
 
Commitments to sell various privately placed debt securities
$ 71 
 
Investments (Net investment income) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Net Investment Income [Line Items]
 
 
Gross investment income
$ 572 
$ 539 
Investment expense
(14)
(13)
Net investment income
558 
526 
Fixed maturity securities [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
443 
452 
Short term investments [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
2 
1 
Limited partnership investments [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
114 
73 
Equity securities [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
3 
2 
Mortgage loans [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
8 
6 
Trading portfolio [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
2 
3 
Other [Member]
 
 
Net Investment Income [Line Items]
 
 
Gross investment income
$ 0 
$ 2 
Investments (Net realized investment gains (losses)) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Net realized investment gains (losses)
$ 10 
$ 46 
Fixed maturity securities [Member]
 
 
Gross realized gains
33 
53 
Gross realized losses
(21)
(15)
Net realized investment gains (losses)
12 
38 
Equity securities [Member]
 
 
Gross realized gains
1 
5 
Gross realized losses
(1)
0 
Net realized investment gains (losses)
0 
5 
Derivative [Member]
 
 
Net realized investment gains (losses)
(1)
0 
Short term investments and other [Member]
 
 
Net realized investment gains (losses)
$ (1)
$ 3 
Investments (Components of other-than-temporary impairment losses recognized in earnings) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Other-than-temporary impairment losses recognized in earnings
$ 12 
$ 2 
Corporate and other bonds [Member]
 
 
Other-than-temporary impairment losses recognized in earnings
5 
1 
States, municipalities and political subdivisions [Member]
 
 
Other-than-temporary impairment losses recognized in earnings
5 
0 
Residential mortgage-backed [Member]
 
 
Other-than-temporary impairment losses recognized in earnings
1 
1 
Total fixed maturity securities available-for-sale [Member]
 
 
Other-than-temporary impairment losses recognized in earnings
11 
2 
Common stock [Member]
 
 
Other-than-temporary impairment losses recognized in earnings
$ 1 
$ 0 
Investments (Summary of fixed maturity and equity securities) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Cost or Amortized Cost
$ 37,088 
$ 37,545 
Gross Unrealized Gain
3,817 
3,544 
Gross Unrealized Loss
75 
99 
Estimated fair value
40,830 
40,990 
Corporate and other bonds [Member]
 
 
Cost or Amortized Cost
16,721 
17,210 
Gross Unrealized Gain
1,867 
1,721 
Gross Unrealized Loss
43 
61 
Estimated fair value
18,545 
18,870 
Unrealized OTTI Losses (Gains)
0 
0 
States, municipalities and political subdivisions [Member]
 
 
Cost or Amortized Cost
11,407 
11,285 
Gross Unrealized Gain
1,536 
1,463 
Gross Unrealized Loss
9 
8 
Estimated fair value
12,934 
12,740 
Unrealized OTTI Losses (Gains)
0 
0 
Residential mortgage-backed [Member]
 
 
Cost or Amortized Cost
4,998 
5,028 
Gross Unrealized Gain
241 
218 
Gross Unrealized Loss
13 
13 
Estimated fair value
5,226 
5,233 
Unrealized OTTI Losses (Gains)
(51)
(53)
Commercial mortgage-backed [Member]
 
 
Cost or Amortized Cost
2,151 
2,056 
Gross Unrealized Gain
114 
93 
Gross Unrealized Loss
5 
5 
Estimated fair value
2,260 
2,144 
Unrealized OTTI Losses (Gains)
(3)
(2)
Other asset-backed [Member]
 
 
Cost or Amortized Cost
1,109 
1,234 
Gross Unrealized Gain
15 
11 
Gross Unrealized Loss
1 
10 
Estimated fair value
1,123 
1,235 
Unrealized OTTI Losses (Gains)
0 
0 
Total asset-backed [Member]
 
 
Cost or Amortized Cost
8,258 
8,318 
Gross Unrealized Gain
370 
322 
Gross Unrealized Loss
19 
28 
Estimated fair value
8,609 
8,612 
Unrealized OTTI Losses (Gains)
(54)
(55)
U.S. Treasury and obligations of government-sponsored enterprises [Member]
 
 
Cost or Amortized Cost
24 
26 
Gross Unrealized Gain
6 
5 
Gross Unrealized Loss
0 
0 
Estimated fair value
30 
31 
Unrealized OTTI Losses (Gains)
0 
0 
Foreign Government Debt Securities [Member]
 
 
Cost or Amortized Cost
390 
438 
Gross Unrealized Gain
19 
16 
Gross Unrealized Loss
0 
0 
Estimated fair value
409 
454 
Unrealized OTTI Losses (Gains)
0 
0 
Redeemable preferred stock [Member]
 
 
Cost or Amortized Cost
39 
39 
Gross Unrealized Gain
3 
3 
Gross Unrealized Loss
0 
0 
Estimated fair value
42 
42 
Unrealized OTTI Losses (Gains)
0 
0 
Total fixed maturity securities available-for-sale [Member]
 
 
Cost or Amortized Cost
36,839 
37,316 
Gross Unrealized Gain
3,801 
3,530 
Gross Unrealized Loss
71 
97 
Estimated fair value
40,569 
40,749 
Unrealized OTTI Losses (Gains)
(54)
(55)
Total fixed maturity securities trading [Member]
 
 
Cost or Amortized Cost, Trading Securities
36 
19 
Estimated Fair Value, Trading Securities
36 
19 
Common stock [Member]
 
 
Cost or Amortized Cost
41 
38 
Gross Unrealized Gain
9 
9 
Gross Unrealized Loss
0 
0 
Estimated fair value
50 
47 
Preferred stock [Member]
 
 
Cost or Amortized Cost
172 
172 
Gross Unrealized Gain
7 
5 
Gross Unrealized Loss
4 
2 
Estimated fair value
175 
175 
Total equity securities available-for-sale [Member]
 
 
Cost or Amortized Cost
213 
210 
Gross Unrealized Gain
16 
14 
Gross Unrealized Loss
4 
2 
Estimated fair value
$ 225 
$ 222 
Investments (Activity related to the pretax fixed maturity credit loss component reflected within retained earnings for securities still held for which a portion of an OTTI loss was recognized in OCI) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
 
 
Beginning balance of credit losses on fixed maturity securities
$ 62 
$ 74 
Reductions for securities sold during the period
(1)
(2)
Reductions for securities the Company intends to sell or more likely than not will be required to sell
0 
(3)
Ending balance of credit losses on fixed maturity securities
$ 61 
$ 69 
Investments (Securities in a gross unrealized loss position) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
$ 2,030 
$ 2,855 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
50 
70 
Estimated Fair Value, 12 Months or Longer
455 
707 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
25 
29 
Estimated Fair Value, Total
2,485 
3,562 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
75 
99 
Corporate and other bonds [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
840 
1,330 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
31 
46 
Estimated Fair Value, 12 Months or Longer
139 
277 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
12 
15 
Estimated Fair Value, Total
979 
1,607 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
43 
61 
States, municipalities and political subdivisions [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
479 
335 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
6 
5 
Estimated Fair Value, 12 Months or Longer
100 
127 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
3 
3 
Estimated Fair Value, Total
579 
462 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
9 
8 
Residential mortgage-backed [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
318 
293 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
5 
5 
Estimated Fair Value, 12 Months or Longer
148 
189 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
8 
8 
Estimated Fair Value, Total
466 
482 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
13 
13 
Commercial mortgage-backed [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
175 
264 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
3 
2 
Estimated Fair Value, 12 Months or Longer
62 
99 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
2 
3 
Estimated Fair Value, Total
237 
363 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
5 
5 
Other asset-backed [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
187 
607 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
1 
10 
Estimated Fair Value, 12 Months or Longer
5 
7 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
0 
0 
Estimated Fair Value, Total
192 
614 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
1 
10 
Total asset-backed [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
680 
1,164 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
9 
17 
Estimated Fair Value, 12 Months or Longer
215 
295 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
10 
11 
Estimated Fair Value, Total
895 
1,459 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
19 
28 
U.S. Treasury and obligations of government-sponsored enterprises [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
3 
3 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
0 
0 
Estimated Fair Value, 12 Months or Longer
0 
4 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
0 
0 
Estimated Fair Value, Total
3 
7 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
0 
0 
Foreign Government Debt Securities [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
13 
3 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
0 
0 
Estimated Fair Value, 12 Months or Longer
1 
3 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
0 
0 
Estimated Fair Value, Total
14 
6 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
0 
0 
Redeemable preferred stock [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
 
3 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
 
0 
Estimated Fair Value, 12 Months or Longer
 
0 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
 
0 
Estimated Fair Value, Total
 
3 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
 
0 
Total fixed maturity securities available-for-sale [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
2,015 
2,838 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
46 
68 
Estimated Fair Value, 12 Months or Longer
455 
706 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
25 
29 
Estimated Fair Value, Total
2,470 
3,544 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
71 
97 
Preferred stock [Member]
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
Estimated Fair Value, Less than 12 Months
15 
17 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss
4 
2 
Estimated Fair Value, 12 Months or Longer
0 
1 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss
0 
0 
Estimated Fair Value, Total
15 
18 
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss
$ 4 
$ 2 
Investments (Contractual maturity) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Investments [Abstract]
 
 
Due in one year or less, cost or amortized cost
$ 2,011 
$ 2,479 
Due after one year through five years, cost or amortized cost
8,760 
9,054 
Due after five years through ten years, cost or amortized cost
12,401 
12,055 
Due after ten years, cost or amortized cost
13,667 
13,728 
Total Amortized Cost Basis
36,839 
37,316 
Due in one year or less, estimated fair value
2,043 
2,511 
Due after one year through five years, estimated fair value
9,340 
9,605 
Due after five years through ten years, estimated fair value
13,108 
12,584 
Due after ten years, estimated fair value
16,078 
16,049 
Total Estimated Fair Value
$ 40,569 
$ 40,749 
Investments Derivative Financial Instruments (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Derivative [Line Items]
 
 
Estimated fair value asset
$ 2 
$ 0 
Estimated fair value liability
5 
3 
Not Designated as Hedging Instrument [Member] |
Currency forwards [Member]
 
 
Derivative [Line Items]
 
 
Derivative, Notional Amount
18 
9 
Estimated fair value asset
2 
0 
Estimated fair value liability
0 
0 
Not Designated as Hedging Instrument [Member] |
Equity warrants [Member]
 
 
Derivative [Line Items]
 
 
Derivative, Notional Amount
5 
5 
Estimated fair value asset
0 
0 
Estimated fair value liability
0 
0 
Not Designated as Hedging Instrument [Member] |
Embedded Derivative Financial Instruments [Member]
 
 
Derivative [Line Items]
 
 
Derivative, Notional Amount
184 
184 
Estimated fair value asset
0 
0 
Estimated fair value liability
$ 5 
$ 3 
Fair Value (Assets and liabilities measured at fair value on a recurring basis) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
$ 42,372 
$ 42,757 
Fair value of liabilities, measured on a recurring basis
5 
3 
Corporate and other bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
18,552 
18,889 
States, municipalities and political subdivisions [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
12,963 
12,740 
Residential mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
5,226 
5,233 
Commercial mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
2,260 
2,144 
Other asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
1,123 
1,235 
Total asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
8,609 
8,612 
U.S. Treasury and obligations of government-sponsored enterprises [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
30 
31 
Foreign Government Debt Securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
409 
454 
Redeemable preferred stock [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
42 
42 
Fixed maturity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
40,605 
40,768 
Equity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
225 
222 
Derivative Financial Instruments, Assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
2 
 
Other invested assets, excluding derivative financial instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
41 
41 
Short term investments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
1,420 
1,644 
Life settlement contracts, included in Other assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
79 
82 
Embedded Derivative Financial Instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of liabilities, measured on a recurring basis
5 
3 
Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
1,016 
957 
Fair value of liabilities, measured on a recurring basis
0 
0 
Level 1 [Member] |
Corporate and other bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
29 
32 
Level 1 [Member] |
States, municipalities and political subdivisions [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
Residential mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
Commercial mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
Other asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
Total asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
U.S. Treasury and obligations of government-sponsored enterprises [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
29 
28 
Level 1 [Member] |
Foreign Government Debt Securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
37 
41 
Level 1 [Member] |
Redeemable preferred stock [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
30 
30 
Level 1 [Member] |
Fixed maturity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
125 
131 
Level 1 [Member] |
Equity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
149 
145 
Level 1 [Member] |
Derivative Financial Instruments, Assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
 
Level 1 [Member] |
Other invested assets, excluding derivative financial instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
Short term investments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
742 
681 
Level 1 [Member] |
Life settlement contracts, included in Other assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 1 [Member] |
Embedded Derivative Financial Instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of liabilities, measured on a recurring basis
0 
0 
Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
40,143 
40,519 
Fair value of liabilities, measured on a recurring basis
5 
3 
Level 2 [Member] |
Corporate and other bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
18,337 
18,695 
Level 2 [Member] |
States, municipalities and political subdivisions [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
12,877 
12,646 
Level 2 [Member] |
Residential mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
4,994 
5,044 
Level 2 [Member] |
Commercial mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
2,196 
2,061 
Level 2 [Member] |
Other asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
570 
580 
Level 2 [Member] |
Total asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
7,760 
7,685 
Level 2 [Member] |
U.S. Treasury and obligations of government-sponsored enterprises [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
1 
3 
Level 2 [Member] |
Foreign Government Debt Securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
372 
413 
Level 2 [Member] |
Redeemable preferred stock [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
12 
12 
Level 2 [Member] |
Fixed maturity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
39,359 
39,454 
Level 2 [Member] |
Equity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
63 
61 
Level 2 [Member] |
Derivative Financial Instruments, Assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
2 
 
Level 2 [Member] |
Other invested assets, excluding derivative financial instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
41 
41 
Level 2 [Member] |
Short term investments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
678 
963 
Level 2 [Member] |
Life settlement contracts, included in Other assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 2 [Member] |
Embedded Derivative Financial Instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of liabilities, measured on a recurring basis
5 
3 
Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
1,213 
1,281 
Fair value of liabilities, measured on a recurring basis
0 
0 
Level 3 [Member] |
Corporate and other bonds [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
186 
162 
Level 3 [Member] |
States, municipalities and political subdivisions [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
86 
94 
Level 3 [Member] |
Residential mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
232 
189 
Level 3 [Member] |
Commercial mortgage-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
64 
83 
Level 3 [Member] |
Other asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
553 
655 
Level 3 [Member] |
Total asset-backed [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
849 
927 
Level 3 [Member] |
U.S. Treasury and obligations of government-sponsored enterprises [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 3 [Member] |
Foreign Government Debt Securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 3 [Member] |
Redeemable preferred stock [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 3 [Member] |
Fixed maturity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
1,121 
1,183 
Level 3 [Member] |
Equity securities [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
13 
16 
Level 3 [Member] |
Derivative Financial Instruments, Assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
 
Level 3 [Member] |
Other invested assets, excluding derivative financial instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
 
0 
Level 3 [Member] |
Short term investments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
0 
0 
Level 3 [Member] |
Life settlement contracts, included in Other assets [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of assets, measured on a recurring basis
79 
82 
Level 3 [Member] |
Embedded Derivative Financial Instruments [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Fair value of liabilities, measured on a recurring basis
$ 0 
$ 0 
Fair Value (Table of reconciliation for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
$ 1,281 
$ 1,303 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
18 
17 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
7 
12 
Purchases
125 
178 
Sales
(156)
(95)
Settlements
(53)
(110)
Transfers into Level 3
37 
38 
Transfers out of Level 3
(46)
(55)
Balance, Ending, Assets
1,213 
1,288 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
1 
1 
Fixed maturity securities [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
1,183 
1,203 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
5 
4 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
10 
16 
Purchases
125 
178 
Sales
(156)
(87)
Settlements
(37)
(99)
Transfers into Level 3
37 
38 
Transfers out of Level 3
(46)
(54)
Balance, Ending, Assets
1,121 
1,199 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Corporate and other bonds [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
162 
204 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
1 
1 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
0 
1 
Purchases
12 
5 
Sales
(12)
(4)
Settlements
(14)
(5)
Transfers into Level 3
37 
3 
Transfers out of Level 3
0 
(16)
Balance, Ending, Assets
186 
189 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
States, municipalities and political subdivisions [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
94 
71 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
1 
0 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
0 
1 
Purchases
0 
0 
Sales
0 
0 
Settlements
(9)
0 
Transfers into Level 3
0 
14 
Transfers out of Level 3
0 
0 
Balance, Ending, Assets
86 
86 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Residential mortgage-backed [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
189 
331 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
1 
1 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
0 
15 
Purchases
72 
25 
Sales
0 
0 
Settlements
(10)
(21)
Transfers into Level 3
0 
21 
Transfers out of Level 3
(20)
(13)
Balance, Ending, Assets
232 
359 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Commercial Mortgage Backed Securities [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
83 
151 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
1 
1 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
1 
(1)
Purchases
6 
0 
Sales
0 
0 
Settlements
(1)
(1)
Transfers into Level 3
0 
0 
Transfers out of Level 3
(26)
(24)
Balance, Ending, Assets
64 
126 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Other asset-backed [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
655 
446 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
1 
1 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
9 
0 
Purchases
35 
148 
Sales
(144)
(83)
Settlements
(3)
(72)
Transfers into Level 3
0 
0 
Transfers out of Level 3
0 
(1)
Balance, Ending, Assets
553 
439 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Total asset-backed [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
927 
928 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
3 
3 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
10 
14 
Purchases
113 
173 
Sales
(144)
(83)
Settlements
(14)
(94)
Transfers into Level 3
0 
21 
Transfers out of Level 3
(46)
(38)
Balance, Ending, Assets
849 
924 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Equity securities [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
16 
11 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
0 
3 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
(3)
(4)
Purchases
0 
0 
Sales
0 
(8)
Settlements
0 
0 
Transfers into Level 3
0 
0 
Transfers out of Level 3
0 
0 
Balance, Ending, Assets
13 
2 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
0 
0 
Life settlement contracts, included in Other assets [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
82 
88 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
13 
10 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
0 
0 
Purchases
0 
0 
Sales
0 
0 
Settlements
(16)
(11)
Transfers into Level 3
0 
0 
Transfers out of Level 3
0 
0 
Balance, Ending, Assets
79 
87 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
1 
1 
Separate account business [Member]
 
 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
Balance, Beginning, Assets
 
1 
Net realized investment gains (losses) and net change in unrealized appreciation (depreciation) included in net income (loss)
 
0 
Net change in unrealized appreciation (depreciation) included in other comprehensive income (loss)
 
0 
Purchases
 
0 
Sales
 
0 
Settlements
 
0 
Transfers into Level 3
 
0 
Transfers out of Level 3
 
(1)
Balance, Ending, Assets
 
0 
Unrealized gains (losses) on Level 3 assets and liabilities held at balance sheet date recognized in net income (loss)
 
$ 0 
Fair Value (Quantitative information about significant unobservable inputs in the fair value measurement of level 3 assets) (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Fixed maturity securities [Member] |
Income Approach Valuation Technique [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Assets, Fair Value Disclosure
$ 102 
$ 101 
Fixed maturity securities [Member] |
Income Approach Valuation Technique [Member] |
Minimum [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Credit Spread
2.00% 
2.00% 
Fixed maturity securities [Member] |
Income Approach Valuation Technique [Member] |
Maximum [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Credit Spread
13.00% 
13.00% 
Fixed maturity securities [Member] |
Income Approach Valuation Technique [Member] |
Weighted Average [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Credit Spread
3.00% 
3.00% 
Equity securities [Member] |
Market Approach Valuation Technique [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Assets, Fair Value Disclosure
13 
16 
Equity securities [Member] |
Market Approach Valuation Technique [Member] |
Minimum [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Private offering price
$ 10 
$ 12 
Equity securities [Member] |
Market Approach Valuation Technique [Member] |
Maximum [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Private offering price
$ 4,400 
$ 4,391 
Equity securities [Member] |
Market Approach Valuation Technique [Member] |
Weighted Average [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Private offering price
$ 682 
$ 600 
Life settlement contracts, included in Other assets [Member] |
Income Approach Valuation Technique [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Assets, Fair Value Disclosure
$ 79 
$ 82 
Life settlement contracts, included in Other assets [Member] |
Income Approach Valuation Technique [Member] |
Minimum [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Mortality assumption
55.00% 
55.00% 
Life settlement contracts, included in Other assets [Member] |
Income Approach Valuation Technique [Member] |
Maximum [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Mortality assumption
1,676.00% 
1,676.00% 
Life settlement contracts, included in Other assets [Member] |
Income Approach Valuation Technique [Member] |
Weighted Average [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Mortality assumption
164.00% 
163.00% 
Life settlement contracts, included in Other assets [Member] |
Income Approach Valuation Technique [Member] |
Rate [Member]
 
 
Fair Value Inputs, Assets, Quantitative Information [Line Items]
 
 
Discount rate risk premium
9.00% 
9.00% 
Fair Value (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Mar. 31, 2014
Fair Value Disclosures [Abstract]
 
 
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount
$ 0 
$ 23 
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount
$ 0 
$ 1 
Fair Value (Carrying amount and estimated fair value of financial instrument assets and liabilities which are not measured at fair value) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Financial Assets [Abstract]
 
 
Notes receivable for the issuance of common stock
$ 1 
$ 1 
Mortgage loans
586 
588 
Financial Liabilities [Abstract]
 
 
Long term debt
2,560 
2,559 
Carrying Amount [Member]
 
 
Financial Assets [Abstract]
 
 
Notes receivable for the issuance of common stock
1 
1 
Mortgage loans
586 
588 
Financial Liabilities [Abstract]
 
 
Long term debt
2,560 
2,559 
Estimated Fair Value [Member]
 
 
Financial Assets [Abstract]
 
 
Notes receivable for the issuance of common stock
1 
1 
Mortgage loans
612 
608 
Financial Liabilities [Abstract]
 
 
Long term debt
2,908 
2,883 
Level 1 [Member] |
Estimated Fair Value [Member]
 
 
Financial Assets [Abstract]
 
 
Notes receivable for the issuance of common stock
0 
0 
Mortgage loans
0 
0 
Financial Liabilities [Abstract]
 
 
Long term debt
0 
0 
Level 2 [Member] |
Estimated Fair Value [Member]
 
 
Financial Assets [Abstract]
 
 
Notes receivable for the issuance of common stock
0 
0 
Mortgage loans
0 
0 
Financial Liabilities [Abstract]
 
 
Long term debt
2,908 
2,883 
Level 3 [Member] |
Estimated Fair Value [Member]
 
 
Financial Assets [Abstract]
 
 
Notes receivable for the issuance of common stock
1 
1 
Mortgage loans
612 
608 
Financial Liabilities [Abstract]
 
 
Long term debt
$ 0 
$ 0 
Claim and Claim Adjustment Expense Reserves (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Claim and Claim Adjustment Expense Reserves [Abstract]
 
 
Catastrophe losses net of reinsurance
$ 29 
$ 74 
Claim and Claim Adjustment Expense Reserves (Net prior year development) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Segment Reporting Information [Line Items]
 
 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ (7)
$ 25 
Pretax (favorable) unfavorable premium development, excluding Life & Group
9 
(31)
Total pretax (favorable) unfavorable net prior year development, excluding Life & Group
2 
(6)
Specialty [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
2 
(3)
Pretax (favorable) unfavorable premium development, excluding Life & Group
(6)
(6)
Total pretax (favorable) unfavorable net prior year development, excluding Life & Group
(4)
(9)
Commercial [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
(5)
18 
Pretax (favorable) unfavorable premium development, excluding Life & Group
(1)
(18)
Total pretax (favorable) unfavorable net prior year development, excluding Life & Group
(6)
0 
International [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
(4)
10 
Pretax (favorable) unfavorable premium development, excluding Life & Group
16 
(7)
Total pretax (favorable) unfavorable net prior year development, excluding Life & Group
12 
3 
Corporate and Other [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
0 
0 
Pretax (favorable) unfavorable premium development, excluding Life & Group
0 
0 
Total pretax (favorable) unfavorable net prior year development, excluding Life & Group
$ 0 
$ 0 
Claim and Claim Adjustment Expense Reserves (Net prior year claim and allocated claim adjustment expense reserve development for Specialty segment) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ (7)
$ 25 
Specialty [Member]
 
 
Medical Professional Liability
14 
0 
Other Professional Liability and Management Liability
(3)
(6)
Surety
1 
1 
Warranty
0 
0 
Other
(10)
2 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ 2 
$ (3)
Claim and Claim Adjustment Expense Reserves (Net prior year claim and allocated claim adjustment expense reserve development for Commercial segment) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ (7)
$ 25 
Commercial [Member]
 
 
Commercial Auto
0 
20 
General Liability
4 
0 
Workers' Compensation
(1)
11 
Property and Other
(8)
(13)
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ (5)
$ 18 
Claim and Claim Adjustment Expense Reserves Net prior year claim and allocated claim adjustment expense reserve development for International segment (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ (7)
$ 25 
International [Member]
 
 
Medical Professional Liability
0 
1 
Other Professional Liability
0 
(1)
Liability
(5)
(2)
Property & Marine
(6)
8 
Other
7 
(6)
Commutations
0 
10 
Pretax (favorable) unfavorable net prior year claim and allocated claim adjustment expense reserve development, excluding Life & Group
$ (4)
$ 10 
Benefit Plans (Components of net periodic cost (benefit)) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Pension Plans, Defined Benefit [Member]
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
Service cost
$ 2 
$ 3 
Interest cost on projected benefit obligation
28 
33 
Expected return on plan assets
(43)
(48)
Amortization of net actuarial (gain) loss
9 
6 
Net periodic (benefit) cost
(4)
(6)
Other Postretirement Benefit Plans, Defined Benefit [Member]
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
Amortization of prior service credit
0 
(4)
Net periodic (benefit) cost
$ 0 
$ (4)
Commitments, Contingencies, and Guarantees (Narrative) (Detail) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Property Lease Guarantee [Member]
 
 
Loss Contingencies [Line Items]
 
 
Guarantor Obligations, Maximum Exposure, Undiscounted
$ 41 
 
Guarantee and indemnification agreements [Member]
 
 
Loss Contingencies [Line Items]
 
 
Guarantor Obligations, Current Carrying Value
5 
5 
Guarantee Obligations [Member]
 
 
Loss Contingencies [Line Items]
 
 
Guarantor Obligations, Maximum Exposure, Undiscounted
375 
 
Indemnification Agreement [Member]
 
 
Loss Contingencies [Line Items]
 
 
Guarantor Obligations, Maximum Exposure, Undiscounted
324 
 
Structured settlement annuities [Member]
 
 
Loss Contingencies [Line Items]
 
 
Guarantor Obligations, Maximum Exposure, Undiscounted
$ 2,000 
 
Accumulated Other Comprehensive Income (Loss) by Component (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Accumulated other comprehensive income (loss), beginning balance
$ 400 
$ 442 
Transfer to net assets held for sale
 
0 
Other comprehensive income (loss), before reclassifications
24 
276 
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit
3 
26 
Other comprehensive income (loss) after tax (expense) benefit
21 
250 
Accumulated other comprehensive income (loss), ending balance
421 
692 
Tax (expense) benefit on amounts reclassified from accumulated other comprehensive income (loss)
3 
(13)
Tax (expense) benefit on other comprehensive income (loss)
(65)
(139)
Net unrealized gains (losses) on investments with OTTI losses [Member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Accumulated other comprehensive income (loss), beginning balance
36 
26 
Transfer to net assets held for sale
 
(5)
Other comprehensive income (loss), before reclassifications
(1)
12 
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit
0 
0 
Other comprehensive income (loss) after tax (expense) benefit
(1)
12 
Accumulated other comprehensive income (loss), ending balance
35 
33 
Tax (expense) benefit on amounts reclassified from accumulated other comprehensive income (loss)
0 
0 
Tax (expense) benefit on other comprehensive income (loss)
0 
(6)
Net unrealized gains (losses) on other investments [Member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Accumulated other comprehensive income (loss), beginning balance
942 
692 
Transfer to net assets held for sale
 
(17)
Other comprehensive income (loss), before reclassifications
121 
264 
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit
9 
27 
Other comprehensive income (loss) after tax (expense) benefit
112 
237 
Accumulated other comprehensive income (loss), ending balance
1,054 
912 
Tax (expense) benefit on amounts reclassified from accumulated other comprehensive income (loss)
0 
(14)
Tax (expense) benefit on other comprehensive income (loss)
(62)
(127)
Accumulated Net Unrealized Gains Losses on discontinued operations [Member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Accumulated other comprehensive income (loss), beginning balance
 
0 
Transfer to net assets held for sale
 
22 
Other comprehensive income (loss), before reclassifications
 
8 
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit
 
0 
Other comprehensive income (loss) after tax (expense) benefit
 
8 
Accumulated other comprehensive income (loss), ending balance
 
30 
Tax (expense) benefit on amounts reclassified from accumulated other comprehensive income (loss)
 
0 
Tax (expense) benefit on other comprehensive income (loss)
 
(5)
Pension and postretirement benefits [Member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Accumulated other comprehensive income (loss), beginning balance
(633)
(426)
Transfer to net assets held for sale
 
0 
Other comprehensive income (loss), before reclassifications
0 
0 
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit
(6)
(1)
Other comprehensive income (loss) after tax (expense) benefit
6 
1 
Accumulated other comprehensive income (loss), ending balance
(627)
(425)
Tax (expense) benefit on amounts reclassified from accumulated other comprehensive income (loss)
3 
1 
Tax (expense) benefit on other comprehensive income (loss)
(3)
(1)
Cumulative foreign currency translation adjustment [Member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Accumulated other comprehensive income (loss), beginning balance
55 
150 
Transfer to net assets held for sale
 
0 
Other comprehensive income (loss), before reclassifications
(96)
(8)
Amounts reclassified from accumulated other comprehensive income (loss) after tax (expense) benefit
0 
0 
Other comprehensive income (loss) after tax (expense) benefit
(96)
(8)
Accumulated other comprehensive income (loss), ending balance
(41)
142 
Tax (expense) benefit on amounts reclassified from accumulated other comprehensive income (loss)
0 
0 
Tax (expense) benefit on other comprehensive income (loss)
$ 0 
$ 0 
Business Segments (Income Statement Information) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Operating Revenues
 
 
Net earned premiums
$ 1,687 
$ 1,806 
Net investment income
558 
526 
Other revenues
97 
85 
Total operating revenues
2,342 
2,417 
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
1,335 
1,443 
Policyholders' dividends
4 
3 
Amortization of deferred acquisition costs
303 
329 
Other insurance related expenses
268 
262 
Other expenses
129 
128 
Total claims, benefits and expenses
2,039 
2,165 
Operating income (loss) before income tax
303 
252 
Income tax (expense) benefit on operating income (loss)
(78)
(62)
Net operating income (loss)
225 
190 
Net realized investment gains (losses), pre-tax
10 
46 
Income tax (expense) benefit on net realized investment gains (losses)
(2)
(16)
Net realized investment gains (losses), after tax
8 
30 
Net income (loss) from continuing operations
233 
220 
Specialty [Member]
 
 
Operating Revenues
 
 
Net earned premiums
680 
692 
Net investment income
155 
144 
Other revenues
78 
68 
Total operating revenues
913 
904 
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
429 
442 
Policyholders' dividends
1 
1 
Amortization of deferred acquisition costs
144 
143 
Other insurance related expenses
69 
65 
Other expenses
67 
61 
Total claims, benefits and expenses
710 
712 
Operating income (loss) before income tax
203 
192 
Income tax (expense) benefit on operating income (loss)
(68)
(63)
Net operating income (loss)
135 
129 
Net realized investment gains (losses), pre-tax
4 
11 
Income tax (expense) benefit on net realized investment gains (losses)
(1)
(3)
Net realized investment gains (losses), after tax
3 
8 
Net income (loss) from continuing operations
138 
137 
Commercial [Member]
 
 
Operating Revenues
 
 
Net earned premiums
678 
735 
Net investment income
204 
191 
Other revenues
9 
10 
Total operating revenues
891 
936 
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
454 
568 
Policyholders' dividends
3 
2 
Amortization of deferred acquisition costs
117 
123 
Other insurance related expenses
127 
126 
Other expenses
8 
8 
Total claims, benefits and expenses
709 
827 
Operating income (loss) before income tax
182 
109 
Income tax (expense) benefit on operating income (loss)
(62)
(35)
Net operating income (loss)
120 
74 
Net realized investment gains (losses), pre-tax
4 
10 
Income tax (expense) benefit on net realized investment gains (losses)
(3)
(2)
Net realized investment gains (losses), after tax
1 
8 
Net income (loss) from continuing operations
121 
82 
International [Member]
 
 
Operating Revenues
 
 
Net earned premiums
191 
241 
Net investment income
14 
15 
Other revenues
0 
0 
Total operating revenues
205 
256 
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
116 
130 
Policyholders' dividends
0 
0 
Amortization of deferred acquisition costs
35 
55 
Other insurance related expenses
37 
40 
Other expenses
5 
7 
Total claims, benefits and expenses
193 
232 
Operating income (loss) before income tax
12 
24 
Income tax (expense) benefit on operating income (loss)
(3)
(8)
Net operating income (loss)
9 
16 
Net realized investment gains (losses), pre-tax
1 
3 
Income tax (expense) benefit on net realized investment gains (losses)
0 
(3)
Net realized investment gains (losses), after tax
1 
0 
Net income (loss) from continuing operations
10 
16 
Life and Group Non-Core [Member]
 
 
Operating Revenues
 
 
Net earned premiums
138 
139 
Net investment income
179 
171 
Other revenues
9 
5 
Total operating revenues
326 
315 
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
340 
306 
Policyholders' dividends
0 
0 
Amortization of deferred acquisition costs
7 
8 
Other insurance related expenses
35 
32 
Other expenses
4 
1 
Total claims, benefits and expenses
386 
347 
Operating income (loss) before income tax
(60)
(32)
Income tax (expense) benefit on operating income (loss)
43 
30 
Net operating income (loss)
(17)
(2)
Net realized investment gains (losses), pre-tax
1 
16 
Income tax (expense) benefit on net realized investment gains (losses)
2 
(6)
Net realized investment gains (losses), after tax
3 
10 
Net income (loss) from continuing operations
(14)
8 
Corporate and Other Non-Core [Member]
 
 
Operating Revenues
 
 
Net earned premiums
0 
0 
Net investment income
6 
5 
Other revenues
2 
2 
Total operating revenues
8 
7 
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
(4)
(3)
Policyholders' dividends
0 
0 
Amortization of deferred acquisition costs
0 
0 
Other insurance related expenses
0 
0 
Other expenses
46 
51 
Total claims, benefits and expenses
42 
48 
Operating income (loss) before income tax
(34)
(41)
Income tax (expense) benefit on operating income (loss)
12 
14 
Net operating income (loss)
(22)
(27)
Net realized investment gains (losses), pre-tax
0 
6 
Income tax (expense) benefit on net realized investment gains (losses)
0 
(2)
Net realized investment gains (losses), after tax
0 
4 
Net income (loss) from continuing operations
(22)
(23)
Eliminations [Member]
 
 
Operating Revenues
 
 
Net earned premiums
0 
(1)
Net investment income
0 
0 
Other revenues
(1)
0 
Total operating revenues
(1)
(1)
Claims, Benefits and Expenses
 
 
Net incurred claims and benefits
0 
0 
Policyholders' dividends
0 
0 
Amortization of deferred acquisition costs
0 
0 
Other insurance related expenses
0 
(1)
Other expenses
(1)
0 
Total claims, benefits and expenses
(1)
(1)
Operating income (loss) before income tax
0 
0 
Income tax (expense) benefit on operating income (loss)
0 
0 
Net operating income (loss)
0 
0 
Net realized investment gains (losses), pre-tax
0 
0 
Income tax (expense) benefit on net realized investment gains (losses)
0 
0 
Net realized investment gains (losses), after tax
0 
0 
Net income (loss) from continuing operations
$ 0 
$ 0 
Business Segments (Balance Sheet Information) (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
$ 4,768 
$ 4,742 
Insurance receivables
2,109 
1,997 
Deferred acquisition costs
616 
600 
Goodwill
151 
152 
Insurance reserves
 
 
Claim and claim adjustment expenses
23,248 
23,271 
Unearned premiums
3,710 
3,592 
Future policy benefits
9,747 
9,490 
Policyholders’ funds
0 
27 
Specialty [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
671 
567 
Insurance receivables
808 
778 
Deferred acquisition costs
307 
304 
Goodwill
117 
117 
Insurance reserves
 
 
Claim and claim adjustment expenses
6,352 
6,229 
Unearned premiums
1,794 
1,763 
Future policy benefits
0 
0 
Policyholders’ funds
 
9 
Commercial [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
675 
690 
Insurance receivables
1,004 
954 
Deferred acquisition costs
225 
213 
Goodwill
0 
0 
Insurance reserves
 
 
Claim and claim adjustment expenses
9,441 
9,514 
Unearned premiums
1,329 
1,273 
Future policy benefits
0 
0 
Policyholders’ funds
 
18 
International [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
207 
207 
Insurance receivables
282 
250 
Deferred acquisition costs
84 
83 
Goodwill
34 
35 
Insurance reserves
 
 
Claim and claim adjustment expenses
1,377 
1,441 
Unearned premiums
449 
431 
Future policy benefits
0 
0 
Policyholders’ funds
 
0 
Life and Group Non-Core [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
543 
525 
Insurance receivables
13 
13 
Deferred acquisition costs
0 
0 
Goodwill
0 
0 
Insurance reserves
 
 
Claim and claim adjustment expenses
3,237 
3,183 
Unearned premiums
139 
125 
Future policy benefits
9,747 
9,490 
Policyholders’ funds
 
0 
Corporate and Other Non-Core [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
2,672 
2,753 
Insurance receivables
2 
2 
Deferred acquisition costs
0 
0 
Goodwill
0 
0 
Insurance reserves
 
 
Claim and claim adjustment expenses
2,841 
2,904 
Unearned premiums
0 
0 
Future policy benefits
0 
0 
Policyholders’ funds
 
0 
Eliminations [Member]
 
 
Segment Reporting Information [Line Items]
 
 
Reinsurance receivables
0 
0 
Insurance receivables
0 
0 
Deferred acquisition costs
0 
0 
Goodwill
0 
0 
Insurance reserves
 
 
Claim and claim adjustment expenses
0 
0 
Unearned premiums
(1)
0 
Future policy benefits
0 
0 
Policyholders’ funds
 
$ 0 
Business Segments (Revenues by Line of Business) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Revenues
$ 2,352 
$ 2,463 
Specialty [Domain]
 
 
Revenues
917 
915 
Management & Professional Liability [Member]
 
 
Revenues
697 
704 
Surety [Member]
 
 
Revenues
120 
122 
Warranty & Alternative Risks [Member]
 
 
Revenues
100 
89 
Commercial [Domain]
 
 
Revenues
895 
946 
Middle Markets [Member]
 
 
Revenues
409 
403 
Small Business [Member]
 
 
Revenues
165 
184 
Other Commercial Insurance [Member]
 
 
Revenues
321 
359 
International [Domain]
 
 
Revenues
206 
259 
Canada [Member]
 
 
Revenues
55 
71 
CNA Europe [Member]
 
 
Revenues
77 
88 
Hardy [Member]
 
 
Revenues
74 
100 
Life & Group Non-Core [Domain]
 
 
Revenues
327 
331 
Corporate and Other [Domain]
 
 
Revenues
8 
13 
Intersegment Eliminations [Domain]
 
 
Revenues
$ (1)
$ (1)
Discontinued Operations Income Statement Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Revenues
 
 
Net Investment Income
 
$ 41 
Net Realized Investment Gains (Losses)
 
1 
Total Revenues
 
42 
Claims, Benefits and Expenses
 
 
Insurance Claims and Policyholders' Benefits
 
31 
Other Operating Expenses
 
1 
Total Claims, Benefits and Expenses
 
32 
Income before Income Tax
 
10 
Income tax (expense) benefit
 
(3)
Income from operations of discontinued operations, net of income tax
 
7 
Impairment loss on sale, net of income tax benefit
 
(214)
Income (Loss) from Discontinued Operations
0 
(207)
Income tax benefit (expense) on impairment
 
$ 41