Fair Values of assets and liabilities [Text Block] | Fair Values of Assets and Liabilities GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; that is, an exit price. The exit price assumes the asset or liability is not exchanged subject to a forced liquidation or distressed sale. Valuation Hierarchy The Company categorizes its fair value measurements according to a three-level hierarchy. The hierarchy prioritizes the inputs used by the Company’s valuation techniques. A level is assigned to each fair value measurement based on the lowest level input that is significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are defined as follows: Level 1 Unadjusted quoted prices for identical assets or liabilities in active markets that are accessible at the measurement date. Level 2 Prices or valuations based on observable inputs other than quoted prices in active markets for identical assets and liabilities. Level 3 Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. The following tables present the balances of assets and liabilities of Ameriprise Financial measured at fair value on a recurring basis: December 31, 2017 Level 1 Level 2 Level 3 Total (in millions) Assets Cash equivalents $ 147 $ 2,025 $ — $ 2,172 Available-for-Sale securities: Corporate debt securities — 13,936 1,139 15,075 Residential mortgage backed securities — 6,456 155 6,611 Commercial mortgage backed securities — 4,374 — 4,374 Asset backed securities — 1,573 7 1,580 State and municipal obligations — 2,463 — 2,463 U.S. government and agency obligations 503 — — 503 Foreign government bonds and obligations — 314 — 314 Common stocks 1 — — 1 Common stocks measured at net asset value (“NAV”) 6 (1) Total Available-for-Sale securities 504 29,116 1,301 30,927 Trading securities 10 34 — 44 Separate account assets at NAV 87,368 (1) Investments segregated for regulatory purposes 623 — — 623 Other assets: Interest rate derivative contracts — 1,104 — 1,104 Equity derivative contracts 63 2,360 — 2,423 Foreign exchange derivative contracts 2 34 — 36 Total other assets 65 3,498 — 3,563 Total assets at fair value $ 1,349 $ 34,673 $ 1,301 $ 124,697 Liabilities Policyholder account balances, future policy benefits and claims: Indexed annuity embedded derivatives $ — $ 5 $ — $ 5 IUL embedded derivatives — — 601 601 GMWB and GMAB embedded derivatives — — (49 ) (49 ) (2) Total policyholder account balances, future policy benefits and claims — 5 552 557 (3) Customer deposits — 10 — 10 Other liabilities: Interest rate derivative contracts 1 415 — 416 Equity derivative contracts 7 2,876 — 2,883 Credit derivative contracts — 2 — 2 Foreign exchange derivative contracts 4 23 — 27 Other 9 6 28 43 Total other liabilities 21 3,322 28 3,371 Total liabilities at fair value $ 21 $ 3,337 $ 580 $ 3,938 December 31, 2016 Level 1 Level 2 Level 3 Total (in millions) Assets Cash equivalents $ 30 $ 1,796 $ — $ 1,826 Available-for-Sale securities: Corporate debt securities — 14,925 1,311 16,236 Residential mortgage backed securities — 6,650 268 6,918 Commercial mortgage backed securities — 3,367 — 3,367 Asset backed securities — 1,481 68 1,549 State and municipal obligations — 2,358 — 2,358 U.S. government and agency obligations 8 — — 8 Foreign government bonds and obligations — 261 — 261 Common stocks 8 8 1 17 Common stocks at NAV 5 (1) Total Available-for-Sale securities 16 29,050 1,648 30,719 Trading securities 9 16 — 25 Separate account assets at NAV 80,210 (1) Investments segregated for regulatory purposes 425 — — 425 Other assets: Interest rate derivative contracts — 1,778 — 1,778 Equity derivative contracts 43 1,531 — 1,574 Credit derivative contracts — 1 — 1 Foreign exchange derivative contracts 13 80 — 93 Total other assets 56 3,390 — 3,446 Total assets at fair value $ 536 $ 34,252 $ 1,648 $ 116,651 Liabilities Policyholder account balances, future policy benefits and claims: Indexed annuity embedded derivatives $ — $ 5 $ — $ 5 IUL embedded derivatives — — 464 464 GMWB and GMAB embedded derivatives — — 614 614 (4) Total policyholder account balances, future policy benefits and claims — 5 1,078 1,083 (5) Customer deposits — 8 — 8 Other liabilities: Interest rate derivative contracts 2 987 — 989 Equity derivative contracts 3 2,132 — 2,135 Foreign exchange derivative contracts 2 45 — 47 Other 3 8 13 24 Total other liabilities 10 3,172 13 3,195 Total liabilities at fair value $ 10 $ 3,185 $ 1,091 $ 4,286 (1) Amounts are comprised of certain financial instruments that are measured at fair value using the NAV per share (or its equivalent) as a practical expedient and have not been classified in the fair value hierarchy. (2) The fair value of the GMWB and GMAB embedded derivatives included $443 million of individual contracts in a liability position and $492 million of individual contracts in an asset position at December 31, 2017. (3) The Company’s adjustment for nonperformance risk resulted in a $(399) million cumulative increase (decrease) to the embedded derivatives at December 31, 2017. (4) The fair value of the GMWB and GMAB embedded derivatives included $880 million of individual contracts in a liability position and $266 million of individual contracts in an asset position at December 31, 2016. (5) The Company’s adjustment for nonperformance risk resulted in a $(498) million cumulative increase (decrease) to the embedded derivatives at December 31, 2016. The following tables provide a summary of changes in Level 3 assets and liabilities of Ameriprise Financial measured at fair value on a recurring basis: Available-for-Sale Securities Corporate Debt Securities Residential Mortgage Backed Securities Commercial Mortgage Backed Securities Asset Backed Securities Common Stocks Total (in millions) Balance, January 1, 2017 $ 1,311 $ 268 $ — $ 68 $ 1 $ 1,648 Total gains (losses) included in: Net income — — — — 1 1 (1) Other comprehensive income (loss) (8 ) 1 — (4 ) — (11 ) Purchases 138 132 65 64 — 399 Sales — — — — (1 ) (1 ) Settlements (302 ) (43 ) — (29 ) — (374 ) Transfers into Level 3 — 20 — 27 8 55 Transfers out of Level 3 — (223 ) (65 ) (119 ) (9 ) (416 ) Balance, December 31, 2017 $ 1,139 $ 155 $ — $ 7 $ — $ 1,301 Changes in unrealized gains (losses) relating to assets held at December 31, 2017 $ — $ — $ — $ (1 ) $ — $ (1 ) (1) Policyholder Account Balances, Other Liabilities IUL GMWB Total (in millions) Balance, January 1, 2017 $ 464 $ 614 $ 1,078 $ 13 Total (gains) losses included in: Net income 87 (2) (977 ) (3) (890 ) 2 (4) Issues 92 326 418 13 Settlements (42 ) (12 ) (54 ) — Balance, December 31, 2017 $ 601 $ (49 ) $ 552 $ 28 Changes in unrealized (gains) losses relating to liabilities held at December 31, 2017 $ 87 (2) $ (946 ) (3) $ (859 ) $ — Available-for-Sale Securities Other Derivative Contracts Corporate Debt Securities Residential Mortgage Backed Securities Commercial Mortgage Backed Securities Asset Backed Securities Common Stocks Total (in millions) Balance, January 1, 2016 $ 1,425 $ 218 $ 3 $ 162 $ — $ 1,808 $ — Cumulative effect of change in accounting policies — — — 21 — 21 — Total gains (losses) included in: Net income (1 ) 1 — (1 ) — (1 ) (1) (2 ) (3) Other comprehensive income (loss) — (1 ) — (4 ) — (5 ) — Purchases 54 209 42 58 — 363 2 Settlements (168 ) (67 ) (3 ) (2 ) — (240 ) — Transfers into Level 3 1 — — 12 1 14 — Transfers out of Level 3 — (92 ) (42 ) (178 ) — (312 ) — Balance, December 31, 2016 $ 1,311 $ 268 $ — $ 68 $ 1 $ 1,648 $ — Changes in unrealized gains (losses) relating to assets held at December 31, 2016 $ 1 $ 1 $ — $ (1 ) $ — $ 1 (1) $ (2 ) (3) Policyholder Account Balances, IUL GMWB Total Other Liabilities (in millions) Balance, January 1, 2016 $ 364 $ 851 $ 1,215 $ — Total (gains) losses included in: Net income 13 (2) (511 ) (3) (498 ) — Issues 115 295 410 13 Settlements (28 ) (21 ) (49 ) — Balance, December 31, 2016 $ 464 $ 614 $ 1,078 $ 13 Changes in unrealized (gains) losses relating to liabilities held at December 31, 2016 $ 13 (2) $ (448 ) (3) $ (435 ) $ — Available-for-Sale Securities Corporate Debt Securities Residential Mortgage Backed Securities Commercial Mortgage Backed Securities Asset Backed Securities Common Stocks Total Trading Securities (in millions) Balance, January 1, 2015 $ 1,518 $ 206 $ 91 $ 169 $ 2 $ 1,986 $ 1 Total gains (losses) included in: Net income (2 ) — — 1 — (1 ) (1) (1 ) (1) Other comprehensive income (loss) (21 ) (2 ) — (2 ) — (25 ) — Purchases 189 334 41 72 — 636 — Settlements (248 ) (55 ) (7 ) (22 ) — (332 ) — Transfers into Level 3 — — 6 14 — 20 — Transfers out of Level 3 (11 ) (265 ) (128 ) (70 ) (2 ) (476 ) — Balance, December 31, 2015 $ 1,425 $ 218 $ 3 $ 162 $ — $ 1,808 $ — Changes in unrealized gains (losses) relating to assets held at December 31, 2015 $ (2 ) $ — $ — $ 1 $ — $ (1 ) (1) $ — Policyholder Account Balances, IUL GMWB Total (in millions) Balance, January 1, 2015 $ 242 $ 479 $ 721 Total (gains) losses included in: Net income 27 (2) 105 (3) 132 Issues 114 271 385 Settlements (19 ) (4 ) (23 ) Balance, December 31, 2015 $ 364 $ 851 $ 1,215 Changes in unrealized (gains) losses relating to liabilities held at December 31, 2015 $ 27 (2) $ 127 (3) $ 154 (1) Included in net investment income in the Consolidated Statements of Operations. (2) Included in interest credited to fixed accounts in the Consolidated Statements of Operations. (3) Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Operations. (4) Included in general and administrative expense in the Consolidated Statements of Operations. The increase (decrease) to pretax income of the Company’s adjustment for nonperformance risk on the fair value of its embedded derivatives was $(71) million , $98 million and $74 million , net of DAC, DSIC, unearned revenue amortization and the reinsurance accrual, for the years ended December 31, 2017 , 2016 and 2015 , respectively. Securities transferred from Level 3 primarily represent securities with fair values that are now obtained from a third party pricing service with observable inputs. Securities transferred to Level 3 represent securities with fair values that are now based on a single non-binding broker quote. The Company recognizes transfers between levels of the fair value hierarchy as of the beginning of the quarter in which each transfer occurred. For assets and liabilities held at the end of the reporting periods that are measured at fair value on a recurring basis, there were no transfers between Level 1 and Level 2. The following tables provide a summary of the significant unobservable inputs used in the fair value measurements developed by the Company or reasonably available to the Company of Level 3 assets and liabilities: December 31, 2017 Fair Value Valuation Technique Unobservable Input Range Weighted Average (in millions) Corporate debt securities (private placements) $ 1,138 Discounted cash flow Yield/spread to U.S. Treasuries 0.7 % – 2.3% 1.1 % Asset backed securities $ 7 Discounted cash flow Annual short-term default rate 3.8% Annual long-term default rate 2.5% – 3.0% 2.7 % Discount rate 10.5% Constant prepayment rate 5.0 % – 10.0% 9.9 % Loss recovery 36.4 % – 63.6% 63.2 % IUL embedded derivatives $ 601 Discounted cash flow Nonperformance risk (1) 71 bps GMWB and GMAB embedded derivatives $ (49 ) Discounted cash flow Utilization of guaranteed withdrawals (2) 0.0 % – 42.0% Surrender rate 0.1 % – 74.7% Market volatility (3) 3.7 % – 16.1% Nonperformance risk (1) 71 bps Contingent consideration liability $ 28 Discounted cash flow Discount rate 9.0% December 31, 2016 Fair Value Valuation Technique Unobservable Input Range Weighted Average (in millions) Corporate debt securities (private placements) $ 1,308 Discounted cash flow Yield/spread to U.S. Treasuries 0.9 % – 2.5% 1.3% Asset backed securities $ 14 Discounted cash flow Annual short-term default rate 4.8% Annual long-term default rate 2.5% Discount rate 13.5% Constant prepayment rate 5.0 % – 10.0% 9.9% Loss recovery 36.4 % – 63.6% 62.8% IUL embedded derivatives $ 464 Discounted cash flow Nonperformance risk (1) 82 bps GMWB and GMAB embedded derivatives $ 614 Discounted cash flow Utilization of guaranteed withdrawals (2) 0.0 % – 75.6% Surrender rate 0.1 % – 66.4% Market volatility (3) 5.3 % – 21.2% Nonperformance risk (1) 82 bps Contingent consideration liabilities $ 13 Discounted cash flow Discount rate 9.0% (1) The nonperformance risk is the spread added to the observable interest rates used in the valuation of the embedded derivatives. (2) The utilization of guaranteed withdrawals represents the percentage of contractholders that will begin withdrawing in any given year. (3) Market volatility is implied volatility of fund of funds and managed volatility funds. Level 3 measurements not included in the table above are obtained from non-binding broker quotes where unobservable inputs utilized in the fair value calculation are not reasonably available to the Company. Sensitivity of Fair Value Measurements to Changes in Unobservable Inputs Significant increases (decreases) in the yield/spread to U.S. Treasuries used in the fair value measurement of Level 3 corporate debt securities in isolation would result in a significantly lower (higher) fair value measurement. Significant increases (decreases) in the annual default rate and discount rate used in the fair value measurement of Level 3 asset backed securities in isolation, generally, would result in a significantly lower (higher) fair value measurement and a significant increase (decrease) in loss recovery in isolation would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the constant prepayment rate in isolation would result in a significantly lower (higher) fair value measurement. Significant increases (decreases) in nonperformance risk used in the fair value measurement of the IUL embedded derivatives in isolation would result in a significantly lower (higher) fair value measurement. Significant increases (decreases) in utilization and volatility used in the fair value measurement of the GMWB and GMAB embedded derivatives in isolation would result in a significantly higher (lower) liability value. Significant increases (decreases) in nonperformance risk and surrender rate used in the fair value measurement of the GMWB and GMAB embedded derivatives in isolation would result in a significantly lower (higher) liability value. Utilization of guaranteed withdrawals and surrender rates vary with the type of rider, the duration of the policy, the age of the contractholder, the distribution channel and whether the value of the guaranteed benefit exceeds the contract accumulation value. Significant increases (decreases) in the discount rate used in the fair value measurement of the contingent consideration liability in isolation would result in a significantly lower (higher) fair value measurement. Determination of Fair Value The Company uses valuation techniques consistent with the market and income approaches to measure the fair value of its assets and liabilities. The Company’s market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company’s income approach uses valuation techniques to convert future projected cash flows to a single discounted present value amount. When applying either approach, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy. Assets Cash Equivalents Cash equivalents include time deposits and other highly liquid investments with original or remaining maturities at the time of purchase of 90 days or less. Actively traded money market funds are measured at their NAV and classified as Level 1. The Company’s remaining cash equivalents are classified as Level 2 and measured at amortized cost, which is a reasonable estimate of fair value because of the short time between the purchase of the instrument and its expected realization. Investments (Available-for-Sale Securities and Trading Securities) When available, the fair value of securities is based on quoted prices in active markets. If quoted prices are not available, fair values are obtained from third party pricing services, non-binding broker quotes, or other model-based valuation techniques. Level 1 securities primarily include U.S. Treasuries. Level 2 securities primarily include corporate bonds, residential mortgage backed securities, commercial mortgage backed securities, asset backed securities, state and municipal obligations and foreign government securities. The fair value of these Level 2 securities is based on a market approach with prices obtained from third party pricing services. Observable inputs used to value these securities can include, but are not limited to, reported trades, benchmark yields, issuer spreads and non-binding broker quotes. Level 3 securities primarily include certain corporate bonds, non-agency residential mortgage backed securities and asset backed securities. The fair value of corporate bonds, non-agency residential mortgage backed securities and certain asset backed securities classified as Level 3 is typically based on a single non-binding broker quote. The underlying inputs used for some of the non-binding broker quotes are not readily available to the Company. The Company’s privately placed corporate bonds are typically based on a single non-binding broker quote. The fair value of certain asset backed securities is determined using a discounted cash flow model. Inputs used to determine the expected cash flows include assumptions about discount rates and default, prepayment and recovery rates of the underlying assets. Given the significance of the unobservable inputs to this fair value measurement, the fair value of the investment in certain asset backed securities is classified as Level 3. In addition to the general pricing controls, the Company reviews the broker prices to ensure that the broker quotes are reasonable and, when available, compares prices of privately issued securities to public issues from the same issuer to ensure that the implicit illiquidity premium applied to the privately placed investment is reasonable considering investment characteristics, maturity, and average life of the investment. In consideration of the above, management is responsible for the fair values recorded on the financial statements. Prices received from third party pricing services are subjected to exception reporting that identifies investments with significant daily price movements as well as no movements. The Company reviews the exception reporting and resolves the exceptions through reaffirmation of the price or recording an appropriate fair value estimate. The Company also performs subsequent transaction testing. The Company performs annual due diligence of third party pricing services. The Company’s due diligence procedures include assessing the vendor’s valuation qualifications, control environment, analysis of asset-class specific valuation methodologies, and understanding of sources of market observable assumptions and unobservable assumptions, if any, employed in the valuation methodology. The Company also considers the results of its exception reporting controls and any resulting price challenges that arise. Separate Account Assets The fair value of assets held by separate accounts is determined by the NAV of the funds in which those separate accounts are invested. The NAV is used as a practical expedient for fair value and represents the exit price for the separate account. Separate account assets are excluded from classification in the fair value hierarchy. Investments Segregated for Regulatory Purposes Investments segregated for regulatory purposes includes U.S. Treasuries that are classified as Level 1. Other Assets Derivatives that are measured using quoted prices in active markets, such as foreign currency forwards, or derivatives that are exchange-traded are classified as Level 1 measurements. The variation margin on futures contracts is also classified as Level 1. The fair value of derivatives that are traded in less active over-the-counter (“OTC”) markets is generally measured using pricing models with market observable inputs such as interest rates and equity index levels. These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options. The counterparties’ nonperformance risk associated with uncollateralized derivative assets was immaterial at December 31, 2017 and 2016 . See Note 15 and Note 16 for further information on the credit risk of derivative instruments and related collateral. Liabilities Policyholder Account Balances, Future Policy Benefits and Claims The Company values the embedded derivatives attributable to the provisions of certain variable annuity riders using internal valuation models. These models calculate fair value by discounting expected cash flows from benefits plus margins for profit, risk and expenses less embedded derivative fees. The projected cash flows used by these models include observable capital market assumptions and incorporate significant unobservable inputs related to contractholder behavior assumptions, implied volatility, and margins for risk, profit and expenses that the Company believes an exit market participant would expect. The fair value also reflects a current estimate of the Company’s nonperformance risk specific to these embedded derivatives. Given the significant unobservable inputs to this valuation, these measurements are classified as Level 3. The embedded derivatives attributable to these provisions are recorded in policyholder account balances, future policy benefits and claims. The Company uses various Black-Scholes calculations to determine the fair value of the embedded derivatives associated with the provisions of its indexed annuity and IUL products. Significant inputs to the EIA calculation include observable interest rates, volatilities and equity index levels and, therefore, are classified as Level 2. The fair value of fixed index annuity and IUL embedded derivatives includes significant observable interest rates, volatilities and equity index levels and the significant unobservable estimate of the Company’s nonperformance risk. Given the significance of the nonperformance risk assumption to the fair value, the fixed index annuity and IUL embedded derivatives are classified as Level 3. The embedded derivatives attributable to these provisions are recorded in policyholder account balances, future policy benefits and claims. The Company’s Corporate Actuarial Department calculates the fair value of the embedded derivatives on a monthly basis. During this process, control checks are performed to validate the completeness of the data. Actuarial management approves various components of the valuation along with the final results. The change in the fair value of the embedded derivatives is reviewed monthly with senior management. The Level 3 inputs into the valuation are consistent with the pricing assumptions and updated as experience develops. Significant unobservable inputs that reflect policyholder behavior are reviewed quarterly along with other valuation assumptions. Customer Deposits The Company uses various Black-Scholes calculations to determine the fair value of the embedded derivative liability associated with the provisions of its stock market certificates. The inputs to these calculations are primarily market observable and include interest rates, volatilities and equity index levels. As a result, these measurements are classified as Level 2. Other Liabilities Derivatives that are measured using quoted prices in active markets, such as foreign currency forwards, or derivatives that are exchange-traded, are classified as Level 1 measurements. The variation margin on futures contracts is also classified as Level 1. The fair value of derivatives that are traded in less active OTC markets is generally measured using pricing models with market observable inputs such as interest rates and equity index levels. These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options. The Company’s nonperformance risk associated with uncollateralized derivative liabilities was immaterial at December 31, 2017 and 2016 . See Note 15 and Note 16 for further information on the credit risk of derivative instruments and related collateral. Securities sold but not yet purchased include highly liquid investments which are short-term in nature. Securities sold but not yet purchased are measured using amortized cost, which is a reasonable estimate of fair value because of the short time between the purchase of the instrument and its expected realization and are classified as Level 2. Contingent consideration liabilities consist of earn-outs and/or deferred payments related to the Company’s acquisitions. Contingent consideration liabilities are recorded at fair value using a discounted cash flow model under multiple scenarios and an unobservable input (discount rate). Given the use of a significant unobservable input, the fair value of contingent consideration liabilities is classified as Level 3 within the fair value hierarchy. Fair Value on a Nonrecurring Basis The Company assesses its investment in affordable housing partnerships for other-than-temporary impairment. The investments that are determined to be other-than-temporarily impaired are written down to their fair value. The Company uses a discounted cash flow model to measure the fair value of these investments. Inputs to the discounted cash flow model are estimates of future net operating losses and tax credits available to the Company and discount rates based on market condition and the financial strength of the syndicator (general partner). During the year ended December 31, 2017, the Company recognized $64 million of impairments on its investment in affordable housing partnerships primarily due to the enactment of the Tax Act. The balance of affordable housing partnerships measured at fair value on a nonrecurring basis was $166 million as of December 31, 2017 and is classified as Level 3 in the fair value hierarchy. Asset and Liabilities Not Reported at Fair Value The following tables provide the carrying value and the estimated fair value of financial instruments that are not reported at fair value: December 31, 2017 Carrying Value Fair Value Level 1 Level 2 Level 3 Total (in millions) Financial Assets Mortgage loans, net $ 2,756 $ — $ — $ 2,752 $ 2,752 Policy and certificate loans 845 — — 801 801 Receivables 1,537 103 946 487 1,536 Restricted and segregated cash 2,524 2,524 — — 2,524 Other investments and assets 520 — 472 49 521 Financial Liabilities Policyholder account balances, future policy benefits and claims $ 10,246 $ — $ — $ 10,755 $ 10,755 Investment certificate reserves 6,390 — — 6,374 6,374 Brokerage customer deposits 3,915 3,915 — — 3,915 Separate account liabilities at NAV 5,177 5,177 (1) Debt and other liabilities 3,290 118 3,180 119 3,417 December 31, 2016 Carrying Value Fair Value Level 1 Level 2 Level 3 Total (in millions) Financial Assets Mortgage loans, net $ 2,986 $ — $ — $ 2,972 $ 2,972 Policy and certificate loans 831 — 1 807 808 Receivables (2) 1,407 127 870 416 1,413 Restricted and segregated cash 2,905 2,905 — — 2,905 Other investments and assets 508 — 449 61 510 Financial Liabilities Policyholder account balances, future policy benefits and claims $ 10,906 $ — $ — $ 11,417 $ 11,417 Investment certificate reserves 5,927 — — 5,914 5,914 Brokerage customer deposits 4,112 4,112 — — 4,112 Separate account liabilities at NAV 4,253 4,253 (1) Debt and other liabilities 3,371 146 3,176 169 3,491 (1) Amounts are comprised of certain financial instruments that are measured at fair value using the NAV per share (or its equivalent) as a practical expedient and have not been classified in the fair value hierarchy. See Note 3 for further information. (2) In the third quarter of 2017, the Company corrected the classification of the fair value of advisor loans, net from Level 2 to Level 3 as the valuation includes a significant unobservable input. The fair value levels at December 31, 2016 have been revised to reflect this change. The fair value of advisor loans, net was $400 million at December 31, 2016 . Mortgage Loans, Net The fair value of commercial mortgage loans, except those with significant credit deterioration, is determined by discounting contractual cash flows using discount rates that reflect current pricing for loans with similar remaining maturities, liquidity and characteristics including LTV ratio, occupancy rate, refinance risk, debt service coverage, location, and property condition. For commercial mortgage loans with significant credit deterioration, fair value is determined using the same adjustments as above with an additional adjustment for the Company’s estimate of the amount recoverable on the loan. Given the significant unobservable inputs to the valuation of commercial mortgage loans, these measurements are classified as Level 3. The fair value of consumer loans is determined by discounting estimated cash flows and incorporating adjustments for prepayment, administration expenses, loss severity, liquidity and credit loss estimates, with discount rates based on the Company’s estimate of current market conditions. The fair value of consumer loans is classified as Level 3 as the valuation includes significant unobservable inputs. Policy and Certificate Loans Policy loans represent loans made against the cash surrender value of the underlying life insurance or annuity product. These loans and the related interest are usually realized at death of the policyholder or contractholder or at surrender of the contract and are not transferable without the underlying insurance or annuity contract. The fair value of policy loans is determined by estimating expected cash flows discounted at rates based on the U.S. Treasury curve. Policy loans are classified as Level 3 as the discount rate used may be adjusted for the underlying performance of individual policies. Certificate loans represent loans made against and collateralized by the underlying certificate balance. These loans do not transfer to third parties separate from the underlying certificate. The outstanding balance of these loans is considered a reasonable estimate of fair value and is classified as Level 2. Receivables Brokerage margin loans are measured at outstanding balances, which are a reasonable estimate of fair value because of the sufficiency of the collateral and short term nature of these loans. Margin loans that are sufficiently collateralized are classified as Level 2. Margin loans that are not sufficiently collateralized are classified as Level 3. Securities borrowed require the Company to deposit cash or collateral with the lender. As the market value of the securities borrowed is monitored daily, the carrying value is a reasonable estimate of fair value. The fair value of securities borrowed is classified as Level 1 as the value of the underlying securities is based on unadjusted prices for identical assets. The fair value of advisor loans is determined by discounting contractual cash flows, net of estimated credit losses, using a current market interest rate. Advisor loans are classified as Level 3. Restricted and Segregated Cash Restricted and segregated cash is generally set aside for specific business transactions, and restrictions are specific to the Company and do not transfer to third party market participants. The carrying amount is a reasonable estimate of fair value. Amounts segregated under federal and other regulations may also reflect resale agreements and are measured at the price at which the securities will be sold. This measurement is a reasonable estimate of fair value because of the short time between entering into the transaction and its expected realization and the reduced risk of credit loss due to pledging U.S. government-backed securities as collateral. The fair value of restricted and segregated cash is classified as Level 1. Other Investments and Assets Other investments and assets primarily consist of syndicated loans. The fair value of syndicated |