Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 20, 2020 | |
Document and Entity Information | ||
Document type | 10-Q | |
Document quarterly report | true | |
Document period end date | Jun. 30, 2020 | |
Document transition report | false | |
Entity file number | 001-10898 | |
Registrant name | Travelers Companies, Inc. | |
Entity incorporation, state | MN | |
Entity tax identification number | 41-0518860 | |
Entity address, address line one | 485 Lexington Avenue | |
Entity address, city | New York | |
Entity address, state | NY | |
Entity address, postal zip code | 10017 | |
City area code | 917 | |
Local phone number | 778-6000 | |
Title of 12(b) security | Common stock, without par value | |
Trading symbol | TRV | |
Security exchange name | NYSE | |
Entity current reporting status | Yes | |
Entity interactive data current | Yes | |
Filer category | Large Accelerated Filer | |
Entity small business | false | |
Entity emerging growth company | false | |
Entity shell company | false | |
Common stock shares outstanding | 253,191,174 | |
Central index key | 0000086312 | |
Amendment flag | false | |
Current fiscal year end date | --12-31 | |
Document fiscal year focus | 2020 | |
Document fiscal period focus | Q2 |
Consolidated Statement of Incom
Consolidated Statement of Income (Loss) (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues | ||||
Premiums | $ 6,955 | $ 6,988 | $ 14,184 | $ 13,843 |
Net investment income | 268 | 648 | 879 | 1,230 |
Fee income | 114 | 116 | 222 | 225 |
Net realized investment gains (losses) | 13 | 25 | (85) | 78 |
Other revenues | 51 | 57 | 109 | 129 |
Total revenues | 7,401 | 7,834 | 15,309 | 15,505 |
Claims and expenses | ||||
Claims and claim adjustment expenses | 5,107 | 4,821 | 9,896 | 9,263 |
Amortization of deferred acquisition costs | 1,173 | 1,134 | 2,351 | 2,251 |
General and administrative expenses | 1,121 | 1,125 | 2,258 | 2,182 |
Interest expense | 85 | 89 | 169 | 177 |
Total claims and expenses | 7,486 | 7,169 | 14,674 | 13,873 |
Income (loss) before income taxes | (85) | 665 | 635 | 1,632 |
Income tax expense (benefit) | (45) | 108 | 75 | 279 |
Net income (loss) | $ (40) | $ 557 | $ 560 | $ 1,353 |
Net income (loss) per share | ||||
Basic (in dollars per share) | $ (0.16) | $ 2.11 | $ 2.19 | $ 5.12 |
Diluted (in dollars per share) | $ (0.16) | $ 2.10 | $ 2.19 | $ 5.08 |
Weighted average number of common shares outstanding | ||||
Basic (in shares) | 251.6 | 261.3 | 253.6 | 262.1 |
Diluted (in shares) | 251.6 | 263.7 | 254.7 | 264.2 |
Cash dividends declared per common share (in dollars per share) | $ 0.85 | $ 0.82 | $ 1.67 | $ 1.59 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (40) | $ 557 | $ 560 | $ 1,353 |
Other comprehensive income: | ||||
Changes in net unrealized gains on investment securities having no credit losses recognized in the consolidated statement of income (loss) | 2,359 | 1,108 | 1,784 | 2,524 |
Changes in net unrealized gains on investment securities having credit losses recognized in the consolidated statement of income (loss) | 3 | (4) | (3) | 1 |
Net changes in benefit plan assets and obligations | 21 | 14 | 44 | 26 |
Net changes in unrealized foreign currency translation | 52 | 5 | (216) | 55 |
Other comprehensive income before income taxes | 2,435 | 1,123 | 1,609 | 2,606 |
Income tax expense | 504 | 235 | 367 | 541 |
Other comprehensive income, net of taxes | 1,931 | 888 | 1,242 | 2,065 |
Comprehensive income | $ 1,891 | $ 1,445 | $ 1,802 | $ 3,418 |
Consolidated Balance Sheet (Una
Consolidated Balance Sheet (Unaudited at June 30, 2020) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Assets | ||
Fixed maturities, available for sale, at fair value (amortized cost $65,430 and $65,281; allowance for expected credit losses of $8 at June 30, 2020) | $ 70,054 | $ 68,134 |
Equity securities, at fair value (cost $378 and $376) | 390 | 425 |
Real estate investments | 962 | 963 |
Short-term securities | 6,087 | 4,943 |
Other investments | 3,108 | 3,419 |
Total investments | 80,601 | 77,884 |
Cash | 623 | 494 |
Investment income accrued | 596 | 618 |
Premiums receivable (net of allowance for expected credit losses of $94 at June 30, 2020) | 8,459 | 7,909 |
Reinsurance recoverables (net of allowance for estimated uncollectible reinsurance of $156 at June 30, 2020) | 8,093 | 8,235 |
Ceded unearned premiums | 945 | 689 |
Deferred acquisition costs | 2,367 | 2,273 |
Contractholder receivables (net of allowance for expected credit losses of $22 at June 30, 2020) | 4,314 | 4,599 |
Goodwill | 3,925 | 3,961 |
Other intangible assets | 319 | 330 |
Other assets | 3,095 | 3,130 |
Total assets | 113,337 | 110,122 |
Liabilities | ||
Claims and claim adjustment expense reserves | 53,109 | 51,849 |
Unearned premium reserves | 15,198 | 14,604 |
Contractholder payables | 4,336 | 4,619 |
Payables for reinsurance premiums | 567 | 363 |
Deferred taxes | 409 | 137 |
Debt | 7,049 | 6,558 |
Other liabilities | 5,726 | 6,049 |
Total liabilities | 86,394 | 84,179 |
Shareholders’ equity | ||
Common stock (1,750.0 shares authorized; 253.2 and 255.5 shares issued and outstanding) | 23,606 | 23,469 |
Retained earnings | 37,069 | 36,977 |
Accumulated other comprehensive income | 1,882 | 640 |
Treasury stock, at cost (525.9 and 522.1 shares) | (35,614) | (35,143) |
Total shareholders’ equity | 26,943 | 25,943 |
Total liabilities and shareholders’ equity | $ 113,337 | $ 110,122 |
Consolidated Balance Sheet Pare
Consolidated Balance Sheet Parentheticals (Unaudited at June 30, 2020) - USD ($) shares in Millions, $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Fixed maturities, available for sale, amortized cost | $ 65,430 | $ 65,281 |
Fixed maturities, available for sale, allowance for expected credit losses | 8 | 0 |
Equity securities, cost | 378 | 376 |
Premiums receivable, allowance for expected credit losses | 94 | 49 |
Reinsurance recoverables, allowance for estimated uncollectible reinsurance | 156 | 92 |
Contractholder receivables, allowance for expected credit losses | $ 22 | $ 20 |
Common stock, shares authorized (in shares) | 1,750 | 1,750 |
Common stock, shares issued (in shares) | 253.2 | 255.5 |
Common stock, shares outstanding (in shares) | 253.2 | 255.5 |
Treasury stock, at cost (in shares) | 525.9 | 522.1 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Shareholders' Equity (Unaudited) - USD ($) $ in Thousands, shares in Millions | Total | Common stock [Member] | Retained earnings [Member] | Retained earnings [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated other comprehensive income (loss), net of tax [Member] | Treasury stock, at cost [Member] | Common shares outstanding [Member] |
Shareholders' Equity [Roll Forward] | |||||||
Shareholders' equity | $ 23,144,000 | $ 35,204,000 | $ (1,859,000) | $ (33,595,000) | |||
Balance, beginning of year at Dec. 31, 2018 | 23,144,000 | 35,204,000 | (1,859,000) | (33,595,000) | |||
Shareholders' Equity [Roll Forward] | |||||||
Employee share-based compensation | 145,000 | ||||||
Compensation amortization under share-based plans and other changes | 83,000 | ||||||
Shareholders' equity | $ 25,321,000 | 23,372,000 | 36,135,000 | 206,000 | (34,392,000) | ||
Net income (loss) | 1,353,000 | 1,353,000 | |||||
Dividends | (421,000) | ||||||
Other | (1,000) | ||||||
Other comprehensive income | 2,065,000 | 2,065,000 | |||||
Treasury stock acquired — share repurchase authorization | (750,000) | ||||||
Net shares acquired related to employee share-based compensation plans | (47,000) | ||||||
Balance, end of period at Jun. 30, 2019 | 25,321,000 | 23,372,000 | 36,135,000 | 206,000 | (34,392,000) | ||
Balance, beginning of year (in shares) at Dec. 31, 2018 | 263.6 | ||||||
Common shares outstanding | |||||||
Treasury stock acquired - share repurchase authorization (in shares) | (5.5) | ||||||
Net shares issued under employee share-based compensation plans (in shares) | 2.2 | ||||||
Balance, end of period (in shares) at Jun. 30, 2019 | 260.3 | ||||||
Shareholders' Equity [Roll Forward] | |||||||
Shareholders' equity | 23,243,000 | 35,795,000 | (682,000) | (34,016,000) | |||
Balance, beginning of year at Mar. 31, 2019 | 23,243,000 | 35,795,000 | (682,000) | (34,016,000) | |||
Shareholders' Equity [Roll Forward] | |||||||
Employee share-based compensation | 91,000 | ||||||
Compensation amortization under share-based plans and other changes | 38,000 | ||||||
Shareholders' equity | 25,321,000 | 23,372,000 | 36,135,000 | 206,000 | (34,392,000) | ||
Net income (loss) | 557,000 | 557,000 | |||||
Dividends | (217,000) | ||||||
Other | 0 | ||||||
Other comprehensive income | 888,000 | 888,000 | |||||
Treasury stock acquired — share repurchase authorization | (375,000) | ||||||
Net shares acquired related to employee share-based compensation plans | (1,000) | ||||||
Balance, end of period at Jun. 30, 2019 | 25,321,000 | 23,372,000 | 36,135,000 | 206,000 | (34,392,000) | ||
Balance, beginning of year (in shares) at Mar. 31, 2019 | 261.9 | ||||||
Common shares outstanding | |||||||
Treasury stock acquired - share repurchase authorization (in shares) | (2.6) | ||||||
Net shares issued under employee share-based compensation plans (in shares) | 1 | ||||||
Balance, end of period (in shares) at Jun. 30, 2019 | 260.3 | ||||||
Shareholders' Equity [Roll Forward] | |||||||
Shareholders' equity | 25,321,000 | 23,372,000 | 36,135,000 | 206,000 | (34,392,000) | ||
Shareholders' equity | 25,943,000 | 23,469,000 | 36,977,000 | 640,000 | (35,143,000) | ||
Shareholders' equity | Accounting Standards Update 2016-13 [Member] | $ (43,000) | ||||||
Balance, beginning of year at Dec. 31, 2019 | 25,943,000 | 23,469,000 | 36,977,000 | 640,000 | (35,143,000) | ||
Balance, beginning of year (Accounting Standards Update 2016-13 [Member]) at Dec. 31, 2019 | (43,000) | ||||||
Shareholders' Equity [Roll Forward] | |||||||
Employee share-based compensation | 56,000 | ||||||
Compensation amortization under share-based plans and other changes | 81,000 | ||||||
Shareholders' equity | 25,943,000 | 23,606,000 | 37,069,000 | 640,000 | (35,614,000) | ||
Shareholders' equity | Accounting Standards Update 2016-13 [Member] | $ (43,000) | ||||||
Net income (loss) | 560,000 | 560,000 | |||||
Dividends | (428,000) | ||||||
Other | 3,000 | ||||||
Other comprehensive income | 1,242,000 | 1,242,000 | |||||
Treasury stock acquired — share repurchase authorization | (425,000) | (425,000) | |||||
Net shares acquired related to employee share-based compensation plans | (46,000) | (46,000) | |||||
Balance, end of period at Jun. 30, 2020 | $ 26,943,000 | 23,606,000 | 37,069,000 | 1,882,000 | (35,614,000) | ||
Balance, beginning of year (in shares) at Dec. 31, 2019 | 255.5 | 255.5 | |||||
Common shares outstanding | |||||||
Treasury stock acquired - share repurchase authorization (in shares) | (3.5) | (3.5) | |||||
Net shares issued under employee share-based compensation plans (in shares) | 1.2 | ||||||
Balance, end of period (in shares) at Jun. 30, 2020 | 253.2 | 253.2 | |||||
Shareholders' Equity [Roll Forward] | |||||||
Shareholders' equity | 23,542,000 | 37,325,000 | (49,000) | (35,614,000) | |||
Balance, beginning of year at Mar. 31, 2020 | 23,542,000 | 37,325,000 | (49,000) | (35,614,000) | |||
Shareholders' Equity [Roll Forward] | |||||||
Employee share-based compensation | 29,000 | ||||||
Compensation amortization under share-based plans and other changes | 35,000 | ||||||
Shareholders' equity | $ 26,943,000 | 23,606,000 | 37,069,000 | 1,882,000 | (35,614,000) | ||
Net income (loss) | (40,000) | (40,000) | |||||
Dividends | (218,000) | ||||||
Other | 2,000 | ||||||
Other comprehensive income | 1,931,000 | 1,931,000 | |||||
Treasury stock acquired — share repurchase authorization | 0 | ||||||
Net shares acquired related to employee share-based compensation plans | (33) | 0 | |||||
Balance, end of period at Jun. 30, 2020 | $ 26,943,000 | 23,606,000 | 37,069,000 | 1,882,000 | (35,614,000) | ||
Balance, beginning of year (in shares) at Mar. 31, 2020 | 252.8 | ||||||
Common shares outstanding | |||||||
Treasury stock acquired - share repurchase authorization (in shares) | 0 | ||||||
Net shares issued under employee share-based compensation plans (in shares) | 0.4 | ||||||
Balance, end of period (in shares) at Jun. 30, 2020 | 253.2 | 253.2 | |||||
Shareholders' Equity [Roll Forward] | |||||||
Shareholders' equity | $ 26,943,000 | $ 23,606,000 | $ 37,069,000 | $ 1,882,000 | $ (35,614,000) |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash flows from operating activities | ||
Net income | $ 560 | $ 1,353 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Net realized investment (gains) losses | 85 | (78) |
Depreciation and amortization | 391 | 401 |
Deferred federal income tax expense (benefit) | (71) | 10 |
Amortization of deferred acquisition costs | 2,351 | 2,251 |
Equity in (income) loss from other investments | 186 | (132) |
Premiums receivable | (571) | (779) |
Reinsurance recoverables | 60 | 151 |
Deferred acquisition costs | (2,453) | (2,408) |
Claims and claim adjustment expense reserves | 1,455 | 329 |
Unearned premium reserves | 643 | 958 |
Other operating activities | (344) | (264) |
Net cash provided by operating activities | 2,292 | 1,792 |
Cash flows from investing activities | ||
Proceeds from maturities of fixed maturities | 3,071 | 3,038 |
Proceeds from sales of investments: | ||
Fixed maturities | 1,220 | 1,495 |
Equity securities | 54 | 71 |
Other investments | 139 | 240 |
Purchases of investments: | ||
Fixed maturities | (4,790) | (5,708) |
Equity securities | (59) | (41) |
Real estate investments | (24) | (85) |
Other investments | (228) | (262) |
Net sales (purchases) of short-term securities | (1,147) | 497 |
Securities transactions in course of settlement | 94 | 223 |
Other investing activities | (144) | (169) |
Net cash used in investing activities | (1,814) | (701) |
Cash flows from financing activities | ||
Treasury stock acquired — share repurchase authorization | (425) | (750) |
Treasury stock acquired — net employee share-based compensation | (46) | (47) |
Dividends paid to shareholders | (426) | (419) |
Payment of debt | 0 | (500) |
Issuance of debt | 490 | 492 |
Issuance of common stock — employee share options | 65 | 174 |
Net cash used in financing activities | (342) | (1,050) |
Effect of exchange rate changes on cash | (7) | 2 |
Net increase in cash | 129 | 43 |
Cash at beginning of year | 494 | 373 |
Cash at end of period | 623 | 416 |
Supplemental disclosure of cash flow information | ||
Income taxes paid | 17 | 325 |
Interest paid | $ 166 | $ 171 |
Basis of Presentation and Accou
Basis of Presentation and Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Accounting Policies | BASIS OF PRESENTATION AND ACCOUNTING POLICIES Basis of Presentation The interim consolidated financial statements include the accounts of The Travelers Companies, Inc. (together with its subsidiaries, the Company). These financial statements are prepared in conformity with U.S. generally accepted accounting principles (GAAP) and are unaudited. In the opinion of the Company’s management, all adjustments necessary for a fair presentation have been reflected. Certain financial information that is normally included in annual financial statements prepared in accordance with GAAP, but that is not required for interim reporting purposes, has been omitted. All material intercompany transactions and balances have been eliminated. The accompanying interim consolidated financial statements and related notes should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the Company’s 2019 Annual Report). The preparation of the interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements and the reported amounts of revenues and claims and expenses during the reporting period. Actual results could differ from those estimates. Certain reclassifications have been made to the 2019 financial statements to conform to the 2020 presentation. Adoption of Accounting Standards Registered Debt Offerings that Include Credit Enhancements from an Affiliate In March 2020, the Securities and Exchange Commission (SEC) adopted amendments to the financial disclosure requirements related to certain debt securities, including registered debt securities issued by a wholly-owned, operating subsidiary that are fully and unconditionally guaranteed by the parent company. Prior to the amendments, a parent guarantor was required to provide condensed consolidating financial information for so long as the guaranteed securities were outstanding, regardless of whether the subsidiary issuer could have suspended its public reporting obligations under the applicable SEC requirements with respect to the securities. In accordance with the amended requirements, a parent guarantor may cease providing the condensed consolidating financial information if the corresponding subsidiary issuer’s public reporting obligation is suspended. The amendments to the financial disclosure requirements are effective on January 4, 2021; however, the SEC permits voluntary compliance in advance of the effective date. The Company elected to apply the amended requirements beginning with the quarter ended March 31, 2020, and is no longer providing condensed consolidating financial information that resulted from the registered debt obligations of its subsidiaries, Travelers Property Casualty Corp. and Travelers Insurance Group Holdings Inc., that were disclosed in note 8 of the financial statements in the Company’s 2019 Annual Report . Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments In June 2016, the Financial Accounting Standards Board issued updated guidance for the accounting for credit losses for financial instruments. The updated guidance applies a new credit loss model (current expected credit losses or CECL) for determining credit-related impairments for financial instruments measured at amortized cost (including reinsurance recoverables and structured settlements that are recorded as part of reinsurance recoverables) and requires an entity to estimate the credit losses expected over the life of an exposure or pool of exposures. The estimate of expected credit losses should consider historical information, current information, as well as reasonable and supportable forecasts, including estimates of prepayments. The expected credit losses, and subsequent adjustments to such losses, are recorded through an allowance account that is deducted from the amortized cost basis of the financial asset, with the net carrying value of the financial asset presented on the consolidated balance sheet at the amount expected to be collected. The updated guidance also amends the previous other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments relating to credit losses through an allowance account and limits the amount of credit loss to the difference between a security’s amortized cost basis and its fair value. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The Company adopted the updated guidance for the quarter ended March 31, 2020. For available-for-sale debt securities, the updated guidance was applied prospectively. For financial instruments measured at amortized cost, the updated guidance was applied by a cumulative effect adjustment to the opening balance of retained earnings as of January 1, 2020, the beginning of the period of adoption. The adoption of this guidance resulted in the recognition of an after-tax cumulative effect adjustment of $43 million to reflect the impact of recognizing expected credit losses, as compared to incurred credit losses recognized under the previous guidance. This adjustment is primarily associated with structured settlements that are recorded as part of reinsurance recoverables. The cumulative effect adjustment decreased retained earnings as of January 1, 2020 and increased the allowance for estimated uncollectible reinsurance. For additional information regarding accounting standards that the Company adopted during the periods presented, see note 1 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. Accounting Standards Not Yet Adopted For information regarding accounting standards that the Company has not yet adopted, see the “Other Accounting Standards Not Yet Adopted” section of note 1 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. Accounting Policies The following accounting policies have been updated to reflect the Company's adoption of Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments as described above. Investment Impairments The Company conducts a periodic review to identify and evaluate invested assets that may have credit impairments. Credit Impairments of Fixed Maturity Investments Some of the factors considered in assessing impairment of fixed maturity investments due to credit-related factors include: (1) the extent to which the fair value has been less than amortized cost; (2) the financial condition, near-term and long-term prospects for the issuer, including the relevant industry conditions and trends, and implications of rating agency actions and offering prices; (3) the likelihood of the recoverability of principal and interest; and (4) whether it is more likely than not that the Company will be required to sell the investment prior to an anticipated recovery in value. Beginning on January 1, 2020, credit losses are recognized through an allowance account. See note 1 - Adoption of Accounting Standards - Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments for additional information. For fixed maturity investments that the Company does not intend to sell or for which it is more likely than not that the Company would not be required to sell before an anticipated recovery in value, the Company separates the credit loss component of the impairment from the amount related to all other factors and reports the credit loss component in net realized investment gains (losses). The impairment related to all other factors (non-credit factors) is reported in other comprehensive income. The allowance is adjusted for any additional credit losses and subsequent recoveries. Upon recognizing a credit loss, the cost basis is not adjusted. For fixed maturity investments where the Company records a credit loss, a determination is made as to the cause of the impairment and whether the Company expects a recovery in the value. For fixed maturity investments where the Company expects a recovery in value, the constant effective yield method is utilized, and the investment is amortized to par. For fixed maturity investments the Company intends to sell or for which it is more likely than not that the Company will be required to sell before an anticipated recovery in value, the full amount of the impairment is included in net realized investment gains (losses). The new cost basis of the investment is the previous amortized cost basis less the impairment recognized in net realized investment gains (losses). The new cost basis is not adjusted for any subsequent recoveries in fair value. The Company reports investment income accrued separately from fixed maturity investments, available for sale, and has elected not to measure an allowance for credit losses for investment income accrued. Investment income accrued is written off through net realized investment gains (losses) at the time the issuer of the bond defaults or is expected to default on payments. Uncollectible available-for-sale debt securities are written-off when the Company determines that no additional payments of principle or interest will be received. Reinsurance Recoverables Amounts recoverable from reinsurers are estimated in a manner consistent with the associated claim liability. Included in reinsurance recoverables are amounts related to certain structured settlements. The Company reports its reinsurance recoverables net of an allowance for estimated uncollectible reinsurance. The allowance is based upon the Company’s ongoing review of amounts outstanding, length of collection periods, changes in reinsurer credit standing, disputes, applicable coverage defenses and other relevant factors. For structured settlements, the allowance is also based upon the Company’s ongoing review of life insurers’ creditworthiness and estimated amounts of coverage that would be available from state guaranty funds if a life insurer defaults. A probability-of-default methodology which reflects current and forecasted economic conditions is used to estimate the amount of uncollectible reinsurance due to credit-related factors and the estimate is reported in an allowance for estimated uncollectible reinsurance. The allowance also includes estimated uncollectible amounts related to dispute risk with reinsurers. Amounts deemed to be uncollectible, including amounts due from known insolvent reinsurers, are written off against the allowance. Changes in the allowance, as well as any subsequent collections of amounts previously written off, are reported as part of claims and claim adjustment expenses. The Company evaluates and monitors the financial condition of its reinsurers under voluntary reinsurance arrangements to minimize its exposure to significant losses from reinsurer insolvencies. Contractholder Receivables and Payables Under certain workers’ compensation insurance contracts with deductible features, the Company is obligated to pay the claimant for the full amount of the claim. The Company is subsequently reimbursed by the policyholder for the deductible amount. These amounts are included on a gross basis in the consolidated balance sheet in both contractholder payables and contractholder receivables. Contractholder receivables are reported net of an allowance for expected credit losses. The allowance is based upon the Company’s ongoing review of amounts outstanding, changes in policyholder credit standing, and other relevant factors. A probability-of-default methodology which reflects current and forecasted economic conditions is used to estimate the allowance for expected credit losses. Premiums and Unearned Premium Reserves Premiums are recognized as revenues pro rata over the policy period. Unearned premium reserves represent the unexpired portion of policy premiums. Accrued retrospective premiums are included in premium balances receivable. Premium balances receivable are reported net of an allowance for expected credit losses. The allowance is based upon the Company’s ongoing review of amounts outstanding, historical loss data, including delinquencies and write-offs, current and forecasted economic conditions and other relevant factors. Credit risk is partially mitigated by the Company’s ability to cancel the policy if the policyholder does not pay the premium. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION Nature of Operations The Company’s results are reported in the following three business segments — Business Insurance, Bond & Specialty Insurance and Personal Insurance. These segments reflect the manner in which the Company’s businesses are currently managed and represent an aggregation of products and services based on the type of customer, how the business is marketed and the manner in which risks are underwritten. For more information regarding the Company’s nature of operations, see the “Nature of Operations ” section of note 1 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. The following tables summarize the components of the Company’s revenues, income (loss) and total assets by reportable business segments: (For the three months ended June 30, in millions) Business Bond & Specialty Personal Total 2020 Premiums $ 3,735 $ 693 $ 2,527 $ 6,955 Net investment income 180 42 46 268 Fee income 108 — 6 114 Other revenues 36 5 10 51 Total segment revenues (1) $ 4,059 $ 740 $ 2,589 $ 7,388 Segment income (loss) (1) $ (58) $ 72 $ 10 $ 24 2019 Premiums $ 3,783 $ 632 $ 2,573 $ 6,988 Net investment income 481 58 109 648 Fee income 111 — 5 116 Other revenues 30 6 21 57 Total segment revenues (1) $ 4,405 $ 696 $ 2,708 $ 7,809 Segment income (1) $ 351 $ 174 $ 88 $ 613 _________________________________________________________ (1) Segment revenues for reportable business segments exclude net realized investment gains (losses) and revenues included in "interest expense and other." Segment income (loss) for reportable business segments equals net income (loss) excluding the after-tax impact of net realized investment gains (losses) and income (loss) from "interest expense and other." (For the six months ended June 30, in millions) Business Bond & Specialty Personal Total 2020 Premiums $ 7,599 $ 1,360 $ 5,225 $ 14,184 Net investment income 633 97 149 879 Fee income 210 — 12 222 Other revenues 67 10 32 109 Total segment revenues (1) $ 8,509 $ 1,467 $ 5,418 $ 15,394 Segment income (1) $ 231 $ 194 $ 346 $ 771 2019 Premiums $ 7,525 $ 1,238 $ 5,080 $ 13,843 Net investment income 908 114 208 1,230 Fee income 215 — 10 225 Other revenues 73 12 43 128 Total segment revenues (1) $ 8,721 $ 1,364 $ 5,341 $ 15,426 Segment income (1) $ 765 $ 312 $ 366 $ 1,443 _________________________________________________________ (1) Segment revenues for reportable business segments exclude net realized investment gains (losses) and revenues included in "interest expense and other." Segment income (loss) for reportable business segments equals net income excluding the after-tax impact of net realized investment gains (losses) and income (loss) from "interest expense and other." Business Segment Reconciliations Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Revenue reconciliation Earned premiums Business Insurance: Domestic: Workers’ compensation $ 818 $ 950 $ 1,717 $ 1,922 Commercial automobile 676 647 1,360 1,275 Commercial property 514 473 1,022 933 General liability 580 585 1,181 1,152 Commercial multi-peril 883 856 1,769 1,696 Other 11 9 23 17 Total Domestic 3,482 3,520 7,072 6,995 International 253 263 527 530 Total Business Insurance 3,735 3,783 7,599 7,525 Bond & Specialty Insurance: Domestic: Fidelity and surety 271 258 528 504 General liability 296 266 583 523 Other 60 53 118 105 Total Domestic 627 577 1,229 1,132 International 66 55 131 106 Total Bond & Specialty Insurance 693 632 1,360 1,238 Personal Insurance: Domestic: Automobile 1,154 1,321 2,505 2,618 Homeowners and Other 1,221 1,078 2,397 2,117 Total Domestic 2,375 2,399 4,902 4,735 International 152 174 323 345 Total Personal Insurance 2,527 2,573 5,225 5,080 Total earned premiums 6,955 6,988 14,184 13,843 Net investment income 268 648 879 1,230 Fee income 114 116 222 225 Other revenues 51 57 109 128 Total segment revenues 7,388 7,809 15,394 15,426 Other revenues — — — 1 Net realized investment gains (losses) 13 25 (85) 78 Total revenues $ 7,401 $ 7,834 $ 15,309 $ 15,505 Income reconciliation, net of tax Total segment income $ 24 $ 613 $ 771 $ 1,443 Interest Expense and Other (1) (74) (76) (145) (151) Core income (loss) (50) 537 626 1,292 Net realized investment gains (losses) 10 20 (66) 61 Net income (loss) $ (40) $ 557 $ 560 $ 1,353 _________________________________________________________ (1) The primary component of Interest Expense and Other was after-tax interest expense of $67 million and $70 million for the three months ended June 30, 2020 and 2019, respectively, and $133 million and $140 million for the six months ended June 30, 2020 and 2019, respectively. (in millions) June 30, December 31, Asset reconciliation Business Insurance $ 86,136 $ 83,896 Bond & Specialty Insurance 9,155 8,599 Personal Insurance 17,427 17,015 Total assets by reportable segment 112,718 109,510 Other assets (1) 619 612 Total consolidated assets $ 113,337 $ 110,122 _________________________________________________________ |
Investments
Investments | 6 Months Ended |
Jun. 30, 2020 | |
Investments [Abstract] | |
Investments | INVESTMENTS Fixed Maturities The amortized cost and fair value of investments in fixed maturities classified as available for sale were as follows: Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Fair Value (at June 30, 2020, in millions) Gains Losses U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,046 $ — $ 49 $ — $ 2,095 Obligations of states, municipalities and political subdivisions: Local general obligation 16,040 — 1,225 1 17,264 Revenue 10,298 — 818 — 11,116 State general obligation 1,144 — 83 — 1,227 Pre-refunded 2,328 — 133 — 2,461 Total obligations of states, municipalities and political subdivisions 29,810 — 2,259 1 32,068 Debt securities issued by foreign governments 1,023 — 28 — 1,051 Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 2,910 — 174 — 3,084 All other corporate bonds 29,619 8 2,184 62 31,733 Redeemable preferred stock 22 — 1 — 23 Total $ 65,430 $ 8 $ 4,695 $ 63 $ 70,054 Amortized Gross Unrealized Fair (at December 31, 2019, in millions) Cost Gains Losses Value U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,076 $ 19 $ — $ 2,095 Obligations of states, municipalities and political subdivisions: Local general obligation 15,490 829 4 16,315 Revenue 9,731 586 2 10,315 State general obligation 1,167 64 — 1,231 Pre-refunded 1,968 88 — 2,056 Total obligations of states, municipalities and political subdivisions 28,356 1,567 6 29,917 Debt securities issued by foreign governments 1,167 8 2 1,173 Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 3,192 91 3 3,280 All other corporate bonds 30,442 1,195 18 31,619 Redeemable preferred stock 48 2 — 50 Total $ 65,281 $ 2,882 $ 29 $ 68,134 Pre-refunded bonds of $2.46 billion and $2.06 billion at June 30, 2020 and December 31, 2019, respectively, were bonds for which states or municipalities have established irrevocable trusts, almost exclusively comprised of U.S. Treasury securities and obligations of U.S. government and government agencies and authorities. These trusts were created to fund the payment of principal and interest due under the bonds. Proceeds from sales of fixed maturities classified as available for sale were $1.22 billion and $1.50 billion during the six months ended June 30, 2020 and 2019, respectively. Gross gains of $31 million and $35 million and gross losses of $1 million and $4 million were realized on those sales during the six months ended June 30, 2020 and 2019, respectively. Equity Securities The cost and fair value of investments in equity securities were as follows: Fair (at June 30, 2020, in millions) Cost Gross Gains Gross Losses Value Public common stock $ 344 $ 30 $ 23 $ 351 Non-redeemable preferred stock 34 6 1 39 Total $ 378 $ 36 $ 24 $ 390 Fair (at December 31, 2019, in millions) Cost Gross Gains Gross Losses Value Public common stock $ 341 $ 45 $ 3 $ 383 Non-redeemable preferred stock 35 7 — 42 Total $ 376 $ 52 $ 3 $ 425 For the six months ended June 30, 2020 and 2019, the Company recognized $(33) million and $45 million of net gains (losses) on equity securities still held as of June 30, 2020 and 2019, respectively. Net realized investment losses on equity securities still held for the first six months of 2020 were driven by the impact of changes in fair value attributable to the volatility in global financial markets associated with the global pandemic beginning in March 2020 related to the novel coronavirus COVID-19. Unrealized Investment Losses The following tables summarize, for all investments in an unrealized loss position at June 30, 2020 and December 31, 2019, the aggregate fair value and gross unrealized loss by length of time those securities have been continuously in an unrealized loss position. The fair value amounts reported in the tables are estimates that are prepared using the process described in note 4 herein and in note 4 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. The Company also relies upon estimates of several credit and non-credit factors in its review and evaluation of individual investments, using the process described in note 1 of notes to the consolidated financial statements to determine whether credit impairment exists. Less than 12 months 12 months or longer Total (at June 30, 2020, in millions) Fair Gross Fair Gross Fair Gross Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 46 $ — $ — $ — $ 46 $ — Obligations of states, municipalities and political subdivisions 334 1 — — 334 1 Debt securities issued by foreign governments 12 — — — 12 — Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 25 — 2 — 27 — All other corporate bonds 1,079 51 141 11 1,220 62 Total $ 1,496 $ 52 $ 143 $ 11 $ 1,639 $ 63 Less than 12 months 12 months or longer Total (at December 31, 2019, in millions) Fair Gross Fair Gross Fair Gross Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 5 $ — $ 193 $ — $ 198 $ — Obligations of states, municipalities and political subdivisions 668 6 12 — 680 6 Debt securities issued by foreign governments 257 1 147 1 404 2 Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 399 2 131 1 530 3 All other corporate bonds 1,571 10 662 8 2,233 18 Total $ 2,900 $ 19 $ 1,145 $ 10 $ 4,045 $ 29 At June 30, 2020, the amount of gross unrealized losses for all fixed maturity investments reported at fair value for which fair value was less than 80% of amortized cost was not significant. Credit Impairment Charges The following tables present changes in the allowance for expected credit losses on fixed maturities classified as available for sale: Fixed Maturities (for the three months ended June 30, 2020 in millions) Mortgage-Backed Securities, Collateralized Mortgage Obligations and Pass-Through Securities All Other Corporate Bonds Total Balance, April 1, 2020 $ — $ 4 $ 4 Additions for expected credit losses on securities where no credit losses were previously recognized — 4 4 Additions (reductions) for expected credit losses on securities where credit losses were previously recognized — — — Reductions due to sales/defaults of credit-impaired securities — — — Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell (1) — — — Balance, June 30, 2020 $ — $ 8 $ 8 ___________________________________________________________________________________ (1) Credit impairment charges recognized in net realized investment gains (losses) for the three months ended June 30, 2020 included $2 million of credit losses on fixed maturity securities which the Company intends to sell. An allowance for expected credit losses was not previously recorded for these securities. Fixed Maturities (for the six months ended June 30, 2020 in millions) Mortgage-Backed Securities, Collateralized Mortgage Obligations and Pass-Through Securities All Other Corporate Bonds Total Balance, January 1, 2020 $ — $ — $ — Additions for expected credit losses on securities where no credit losses were previously recognized — 8 8 Additions (reductions) for expected credit losses on securities where credit losses were previously recognized — — — Reductions due to sales/defaults of credit-impaired securities — — — Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell (1) — — — Balance, June 30, 2020 $ — $ 8 $ 8 _________________________________________________________ (1) Credit impairment charges recognized in net realized investment gains (losses) for the six months ended June 30, 2020 included $14 million credit losses on fixed maturity securities which the Company intends to sell. An allowance for expected credit losses was not previously recorded for these securities. Total credit impairment charges included in net realized investment gains (losses) in the consolidated statement of income (loss) were $46 million and $1 million for the three months ended June 30, 2020 and 2019, respectively, and $62 million and $2 million for the six months ended June 30, 2020 and 2019, respectively. Additionally, net realized investment gains (losses) for the second quarter of 2020 included $40 million of realized losses related to the other-than-temporary impairment of the carrying value of an equity method investment included in other investments. Credit losses related to the fixed maturity portfolio for the three months and six months ended June 30, 2020 and 2019 represented less than 1% of the fixed maturity portfolio on a pre-tax basis and less than 1% of shareholders’ equity on an after-tax basis at both June 30, 2020 and 2019. Other Investments |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The Company’s estimates of fair value for financial assets and financial liabilities are based on the framework established in the fair value accounting guidance. The framework is based on the inputs used in valuation, gives the highest priority to quoted prices in active markets and requires that observable inputs be used in the valuations when available. The disclosure of fair value estimates in the fair value accounting guidance hierarchy is based on whether the significant inputs into the valuation are observable. In determining the level of the hierarchy in which the estimate is disclosed, the highest priority is given to unadjusted quoted prices in active markets and the lowest priority to unobservable inputs that reflect the Company’s significant market assumptions. The level in the fair value hierarchy within which the fair value measurement is reported is based on the lowest level input that is significant to the measurement in its entirety. The three levels of the hierarchy are as follows: • Level 1 - Unadjusted quoted market prices for identical assets or liabilities in active markets that the Company has the ability to access. • Level 2 - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, prepayment speeds, default rates, loss severities, etc.) or can be corroborated by observable market data. • Level 3 - Valuations based on models where significant inputs are not observable. The unobservable inputs reflect the Company’s own assumptions about the inputs that market participants would use. Valuation of Investments Reported at Fair Value in Financial Statements The Company utilized a pricing service to estimate fair value measurements for approximately 99% of its fixed maturities at both June 30, 2020 and December 31, 2019. While the vast majority of the Company’s fixed maturities are included in Level 2, the Company holds a number of municipal bonds and corporate bonds which are not valued by the pricing service and also estimates the fair value of these bonds using another internal pricing matrix that includes some unobservable inputs that are significant to the valuation. Due to the limited amount of observable market information, the Company includes the fair value estimates for these particular bonds in Level 3. The fair value of the fixed maturities for which the Company used this internal pricing matrix was $89 million and $73 million at June 30, 2020 and December 31, 2019, respectively. Additionally, the Company holds a small amount of other fixed maturity investments that have characteristics that make them unsuitable for matrix pricing. For these fixed maturities, the Company obtains a quote from a broker (primarily the market maker). The fair value of the fixed maturities for which the Company received a broker quote was $3 million and $28 million at June 30, 2020 and December 31, 2019, respectively. Due to the disclaimers on the quotes that indicate that the price is indicative only, the Company includes these fair value estimates in Level 3. For more information regarding the valuation of the Company’s fixed maturities, equity securities and other investments, see note 4 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. Other Liabilities The Company has a put/call option that was entered into in connection with a business acquisition that allows the Company to acquire the remaining shares of the acquired company at a future date. The fair value of the put/call at June 30, 2020 and December 31, 2019 was $7 million and $8 million, respectively, and was determined using an internal model and is based on the acquired company's financial performance, adjusted for a risk margin and discounted to present value. The Company includes the fair value estimate of the put/call in Level 3. Fair Value Hierarchy The following tables present the level within the fair value hierarchy at which the Company’s financial assets and financial liabilities are measured on a recurring basis. (at June 30, 2020, in millions) Total Level 1 Level 2 Level 3 Invested assets: Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,095 $ 2,095 $ — $ — Obligations of states, municipalities and political subdivisions 32,068 — 32,056 12 Debt securities issued by foreign governments 1,051 — 1,051 — Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 3,084 — 3,084 — All other corporate bonds 31,733 2 31,651 80 Redeemable preferred stock 23 — 23 — Total fixed maturities 70,054 2,097 67,865 92 Equity securities Public common stock 351 351 — — Non-redeemable preferred stock 39 10 29 — Total equity securities 390 361 29 — Other investments 32 14 — 18 Total $ 70,476 $ 2,472 $ 67,894 $ 110 Other liabilities $ 7 $ — $ — $ 7 (at December 31, 2019, in millions) Total Level 1 Level 2 Level 3 Invested assets: Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,095 $ 2,095 $ — $ — Obligations of states, municipalities and political subdivisions 29,917 — 29,905 12 Debt securities issued by foreign governments 1,173 — 1,173 — Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 3,280 — 3,280 — All other corporate bonds 31,619 — 31,530 89 Redeemable preferred stock 50 — 50 — Total fixed maturities 68,134 2,095 65,938 101 Equity securities Public common stock 383 383 — — Non-redeemable preferred stock 42 13 29 — Total equity securities 425 396 29 — Other investments 36 16 — 20 Total $ 68,595 $ 2,507 $ 65,967 $ 121 Other liabilities $ 8 $ — $ — $ 8 There was no significant activity in Level 3 of the hierarchy during the six months ended June 30, 2020 or the year ended December 31, 2019. Financial Instruments Disclosed, But Not Carried, At Fair Value The following tables present the carrying value and fair value of the Company’s financial assets and financial liabilities disclosed, but not carried, at fair value, and the level within the fair value hierarchy at which such assets and liabilities are categorized. (at June 30, 2020, in millions) Carrying Fair Level 1 Level 2 Level 3 Financial assets Short-term securities $ 6,087 $ 6,087 $ 2,139 $ 3,898 $ 50 Financial liabilities Debt $ 6,949 $ 9,059 $ — $ 9,059 $ — Commercial paper $ 100 $ 100 $ — $ 100 $ — (at December 31, 2019, in millions) Carrying Fair Level 1 Level 2 Level 3 Financial assets Short-term securities $ 4,943 $ 4,943 $ 685 $ 4,204 $ 54 Financial liabilities Debt $ 6,458 $ 8,049 $ — $ 8,049 $ — Commercial paper $ 100 $ 100 $ — $ 100 $ — The Company had no material assets or liabilities that were measured at fair value on a non-recurring basis during the six months ended June 30, 2020 or year ended December 31, 2019. |
Allowance for Expected Credit L
Allowance for Expected Credit Losses | 6 Months Ended |
Jun. 30, 2020 | |
Credit Loss [Abstract] | |
Allowance for Expected Credit Losses | ALLOWANCE FOR EXPECTED CREDIT LOSSES Premiums Receivable The following tables present the balances of premiums receivable, net of the allowance for expected credit losses, at June 30, 2020 and January 1, 2020, and the changes in the allowance for expected credit losses for the three months and six months ended June 30, 2020. At and For the Three Months Ended June 30, 2020 At and For the Six Months Ended June 30, 2020 (in millions) Premiums Receivable, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Premiums Receivable, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Balance, beginning of period $ 8,202 $ 78 $ 7,909 $ 49 Current period change for expected credit losses 24 67 Write-offs of uncollectible premiums receivable 8 22 Balance, end of period $ 8,459 $ 94 $ 8,459 $ 94 Reinsurance Recoverables The following tables present the balances of reinsurance recoverables, net of the allowance for estimated uncollectible reinsurance, at June 30, 2020 and January 1, 2020, and the changes in the allowance for estimated uncollectible reinsurance for the three months and six months ended June 30, 2020. At and For the Three Months Ended June 30, 2020 At and For the Six Months Ended June 30, 2020 (in millions) Reinsurance Recoverables, Net of Allowance for Estimated Uncollectible Reinsurance Allowance for Estimated Uncollectible Reinsurance Reinsurance Recoverables, Net of Allowance for Estimated Uncollectible Reinsurance Allowance for Estimated Uncollectible Reinsurance Balance, beginning of period $ 8,152 $ 149 $ 8,235 $ 92 Cumulative effect of adoption of updated accounting guidance for credit losses at January 1, 2020 — 53 Current period change for estimated uncollectible reinsurance 7 11 Write-offs of uncollectible reinsurance recoverables — — Balance, end of period $ 8,093 $ 156 $ 8,093 156 Of the total reinsurance recoverables at June 30, 2020, after deducting mandatory pools and associations and before allowances for estimated uncollectible reinsurance, $5.54 billion, or 87%, were rated by A.M. Best Company. The Company utilizes updated A.M. Best credit ratings on a quarterly basis when determining the allowance. Of the total rated by A.M. Best Company, 93% were rated A- or better. The remaining 13% of reinsurance recoverables were comprised of the following: 6% related to captive insurance companies, 2% related to the Company’s participation in voluntary pools, and 5% were balances from other companies not rated by A.M. Best Company. Certain of the Company's reinsurance recoverables are collateralized by letters of credit, funds held or trust agreements. Contractholder Receivables The following tables present the balances of contractholder receivables, net of the allowance for expected credit losses, at June 30, 2020 and January 1, 2020, and the changes in the allowance for expected credit losses for the three months and six months ended June 30, 2020. At and For the Three Months Ended June 30, 2020 At and For the Six Months Ended June 30, 2020 (in millions) Contractholder Receivables, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Contractholder Receivables, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Balance, beginning of period $ 4,634 $ 20 $ 4,599 $ 20 Current period change for expected credit losses 2 2 Write-offs of uncollectible contractholder receivables — — Balance, end of period $ 4,314 $ 22 $ 4,314 $ 22 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill The following table presents the carrying amount of the Company’s goodwill by segment. Each reportable segment includes goodwill associated with the Company’s international business which is subject to the impact of changes in foreign currency exchange rates. (in millions) June 30, December 31, Business Insurance $ 2,573 $ 2,601 Bond & Specialty Insurance 550 550 Personal Insurance 776 784 Other 26 26 Total $ 3,925 $ 3,961 Other Intangible Assets The following tables present a summary of the Company’s other intangible assets by major asset class. (at June 30, 2020, in millions) Gross Accumulated Net Subject to amortization Customer-related $ 95 $ 25 $ 70 Contract-based (1) 204 181 23 Total subject to amortization 299 206 93 Not subject to amortization 226 — 226 Total $ 525 $ 206 $ 319 (at December 31, 2019, in millions) Gross Accumulated Net Subject to amortization Customer-related $ 99 $ 21 $ 78 Contract-based (1) 205 179 26 Total subject to amortization 304 200 104 Not subject to amortization 226 — 226 Total $ 530 $ 200 $ 330 _________________________________________________________ (1) Contract-based intangible assets subject to amortization are comprised of fair value adjustments on claims and claim adjustment expense reserves, reinsurance recoverables and other contract-related intangible assets. Fair value adjustments recorded in connection with insurance acquisitions were based on management’s estimate of nominal claims and claim adjustment expense reserves and reinsurance recoverables. The method used calculated a risk adjustment to a risk-free discounted reserve that would, if reserves ran off as expected, produce results that yielded the assumed cost-of-capital on the capital supporting the loss reserves. The fair value adjustments are reported as other intangible assets on the consolidated balance sheet, and the amounts measured in accordance with the acquirer’s accounting policies for insurance contracts have been reported as part of the claims and claim adjustment expense reserves and reinsurance recoverables. The intangible assets are being recognized into income over the expected payment pattern. Because the time value of money and the risk adjustment (cost of capital) components of the intangible assets run off at different rates, the amount recognized in income may be a net benefit in some periods and a net expense in other periods. Amortization expense of intangible assets was $3 million and $4 million for the three months ended June 30, 2020 and 2019, respectively, and $7 million and $8 million for the six months ended June 30, 2020 and 2019, respectively. Amortization expense for all intangible assets subject to amortization is estimated to be $7 million for the remainder of 2020, $13 million in 2021, $12 million in 2022, $12 million in 2023 and $11 million in 2024. Amortization expense for intangible assets arising from insurance contracts acquired in a business combination is estimated to be $2 million for the remainder of 2020, $4 million in 2021, $3 million in 2022, $3 million in 2023 and $2 million in 2024. |
Insurance Claim Reserves
Insurance Claim Reserves | 6 Months Ended |
Jun. 30, 2020 | |
Insurance Loss Reserves [Abstract] | |
Insurance Claim Reserves | INSURANCE CLAIM RESERVES Claims and claim adjustment expense reserves were as follows: (in millions) June 30, December 31, Property-casualty $ 53,097 $ 51,836 Accident and health 12 13 Total $ 53,109 $ 51,849 The following table presents a reconciliation of beginning and ending property casualty reserve balances for claims and claim adjustment expenses: Six Months Ended June 30, (in millions) 2020 2019 Claims and claim adjustment expense reserves at beginning of year $ 51,836 $ 50,653 Less reinsurance recoverables on unpaid losses 8,035 8,182 Cumulative effect of adoption of updated accounting guidance for credit losses at January 1, 2020 53 — Net reserves at beginning of year 43,854 42,471 Estimated claims and claim adjustment expenses for claims arising in the current year 9,826 9,329 Estimated increase (decrease) in claims and claim adjustment expenses for claims arising in prior years 16 (118) Total increases 9,842 9,211 Claims and claim adjustment expense payments for claims arising in: Current year 2,664 2,810 Prior years 5,674 5,897 Total payments 8,338 8,707 Unrealized foreign exchange (gain) loss (137) 62 Net reserves at end of period 45,221 43,037 Plus reinsurance recoverables on unpaid losses 7,876 8,022 Claims and claim adjustment expense reserves at end of period $ 53,097 $ 51,059 Gross claims and claim adjustment expense reserves at June 30, 2020 increased by $1.26 billion from December 31, 2019, primarily reflecting the impacts of (i) catastrophe losses in the first six months of 2020, (ii) loss cost trends for the current accident year and (iii) reduced claim settlement activity largely due to the disruptions in the judicial system related to COVID-19. Reinsurance recoverables on unpaid losses at June 30, 2020 decreased by $159 million from December 31, 2019, primarily reflecting cash collections in the first six months of 2020 and the $53 million increase in the allowance for estimated uncollectible reinsurance from the cumulative effect of adoption of updated accounting guidance for credit losses at January 1, 2020. Beginning in late March, in response to COVID-19, a number of states have enacted changes designed to effectively expand workers’ compensation coverage by creating a presumption of compensability for certain types of workers. In addition, other states are considering similar changes. Depending on the number of states that institute such changes and the terms of the changes, the Company could experience elevated claims frequency and severity for its workers’ compensation line, which could have a material adverse effect on its results of operations. Subsequent Event PG&E Corporation and Pacific Gas and Electric Company (together, PG&E) emerged from bankruptcy on July 1, 2020, the date the Debtors' and Shareholder Proponents' Joint Chapter 11 Plan of Reorganization Dated June 19, 2020 (the Plan) became effective. In accordance with terms of the Plan, PG&E funded a trust from which the Company and other subrogation claimants will receive payments related to the 2017 and 2018 California wildfires beginning in the third quarter of 2020. The Company expects to recognize in the third quarter of 2020 a subrogation benefit related to these claims of approximately $400 million pre-tax, net of expenses and amounts that would inure to the benefit of the Company's reinsurers. Prior Year Reserve Development The following disclosures regarding reserve development are on a “net of reinsurance” basis. For the six months ended June 30, 2020 and 2019, estimated claims and claim adjustment expenses incurred included $(16) million and $118 million, respectively, of net favorable (unfavorable) development for claims arising in prior years, including $29 million and $174 million, respectively, of net favorable prior year reserve development, and $24 million and $25 million, respectively, of accretion of discount in each period that impacted the Company's results of operations. Business Insurance. There was no net prior year reserve development in the second quarter of 2020, which reflected the following: • Workers' compensation - better than expected loss experience in the segment's domestic operations for multiple accident years; and • Commercial property - better than expected loss experience in the segment's domestic operations for multiple accident years. Offset by: • General liability (excluding asbestos and environmental) - higher than expected loss experience in the segment's domestic operations for primary and excess coverages for multiple accident years; and • Commercial multi-peril - higher than expected loss experience in the segment's domestic operations for recent accident years. Net favorable prior year reserve development in the second quarter of 2019 totaled $71 million, primarily driven by: • Workers' compensation - better than expected loss experience in the segment's domestic operations for multiple accident years. Partially offset by: • General liability (excluding asbestos and environmental) - higher than expected loss experience in the segment's domestic operations for primary and excess coverages for multiple accident years; • Environmental reserves - an increase of $60 million, primarily in the segment's domestic general liability product line; • Commercial automobile - higher than expected loss experience in the segment's domestic operations for recent accident years; and • International - higher than expected loss experience. Net favorable prior year reserve development in the first six months of 2020 totaled $5 million, primarily driven by: • Workers' compensation - better than expected loss experience in the segment's domestic operations for multiple accident years; and • Commercial property - better than expected loss experience in the segment's domestic operations for multiple accident years. Largely offset by: • Commercial automobile - higher than expected loss experience in the segment's domestic operations for recent accident years; • General liability (excluding asbestos and environmental) - higher than expected loss experience in the segment's domestic operations for primary and excess coverages for multiple accident years; and • Commercial multi-peril - higher than expected loss experience in the segment's domestic operations for recent accident years. Net favorable prior year reserve development in the first six months of 2019 totaled $50 million, primarily driven by: • Workers' compensation - better than expected loss experience in the segment's domestic operations for multiple accident years; and • Commercial property - better than expected loss experience in the segment's domestic operations for recent accident years. Partially offset by: • General liability (excluding asbestos and environmental) - higher than expected loss experience in the segment's domestic operations for primary and excess coverages for multiple accident years, including the impact of the enactment of legislation by a number of states, which extended the statute of limitations for childhood sexual molestation claims; • Environmental reserves - an increase of $60 million, primarily in the segment's domestic general liability product line; • Commercial automobile - higher than expected loss experience in the segment's domestic operations for recent accident years; and • Commercial multi-peril - higher than expected loss experience in the segment's domestic operations for recent accident years. Bond & Specialty Insurance. Net unfavorable prior year reserve development in each of the second quarter and first six months of 2020 was $33 million, primarily driven by higher than expected loss experience in the segment's domestic operations in the general liability product line for recent accident years. Net favorable prior year reserve development in the second quarter and first six months of 2019 totaled $39 million and $42 million, respectively, primarily driven by better than expected loss experience in the segment's domestic operations in the general liability product line for multiple accident years. |
Other Comprehensive Income and
Other Comprehensive Income and Accumulated Other Comprehensive Income | 6 Months Ended |
Jun. 30, 2020 | |
Other Comprehensive Income And Accumulated Other Comprehensive Income Disclosure [Abstract] | |
Other Comprehensive Income and Accumulated Other Comprehensive Income | OTHER COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE INCOME The following tables present the changes in the Company’s accumulated other comprehensive income (loss) (AOCI) for the three months and six months ended June 30, 2020. Changes in Net Unrealized Gains on Investment Securities (in millions) Having No Credit Having Credit Net Benefit Plan Assets and Net Unrealized Total Accumulated Balance, March 31, 2020 $ 1,600 $ 185 $ (828) $ (1,006) $ (49) Other comprehensive income (loss) (OCI) before reclassifications, net of tax 1,867 2 — 53 1,922 Amounts reclassified from AOCI, net of tax (8) — 17 — 9 Net OCI, current period 1,859 2 17 53 1,931 Balance, June 30, 2020 $ 3,459 $ 187 $ (811) $ (953) $ 1,882 Changes in Net Unrealized Gains on Investment Securities (in millions) Having No Credit Losses Recognized in the Consolidated Statement of Income (Loss) Having Credit Net Benefit Plan Assets and Obligations Recognized in Shareholders’ Equity Net Unrealized Foreign Currency Translation Total Accumulated Other Comprehensive Income Balance, December 31, 2019 $ 2,057 $ 189 $ (846) $ (760) $ 640 Other comprehensive income (loss) (OCI) before reclassifications, net of tax 1,408 (2) 1 (193) 1,214 Amounts reclassified from AOCI, net of tax (6) — 34 — 28 Net OCI, current period 1,402 (2) 35 (193) 1,242 Balance, June 30, 2020 $ 3,459 $ 187 $ (811) $ (953) $ 1,882 The following table presents the pre-tax components of the Company’s other comprehensive income and the related income tax expense. Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Changes in net unrealized gains on investment securities: Having no credit losses recognized in the consolidated statement of income (loss) $ 2,359 $ 1,108 $ 1,784 $ 2,524 Income tax expense 500 234 382 534 Net of taxes 1,859 874 1,402 1,990 Having credit losses recognized in the consolidated statement of income (loss) 3 (4) (3) 1 Income tax expense (benefit) 1 (1) (1) — Net of taxes 2 (3) (2) 1 Net changes in benefit plan assets and obligations 21 14 44 26 Income tax expense 4 3 9 5 Net of taxes 17 11 35 21 Net changes in unrealized foreign currency translation 52 5 (216) 55 Income tax expense (benefit) (1) (1) (23) 2 Net of taxes 53 6 (193) 53 Total other comprehensive income 2,435 1,123 1,609 2,606 Total income tax expense 504 235 367 541 Total other comprehensive income, net of taxes $ 1,931 $ 888 $ 1,242 $ 2,065 The following table presents the pre-tax and related income tax (expense) benefit components of the amounts reclassified from the Company’s AOCI to the Company’s consolidated statement of income (loss). Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Reclassification adjustments related to unrealized gains on investment securities: Having no credit losses recognized in the consolidated statement of income (loss) (1) $ (10) $ (13) $ (8) $ (29) Income tax expense (2) (2) (3) (2) (6) Net of taxes (8) (10) (6) (23) Having credit losses recognized in the consolidated statement of income (loss) (1) — — — — Income tax benefit (2) — — — — Net of taxes — — — — Reclassification adjustment related to benefit plan assets and obligations: Claims and claim adjustment expenses (3) 9 6 18 11 General and administrative expenses (3) 13 7 25 15 Total 22 13 43 26 Income tax benefit (2) 5 2 9 5 Net of taxes 17 11 34 21 Reclassification adjustment related to foreign currency translation (1) — — — — Income tax benefit (2) — — — — Net of taxes — — — — Total reclassifications 12 — 35 (3) Total income tax (expense) benefit 3 (1) 7 (1) Total reclassifications, net of taxes $ 9 $ 1 $ 28 $ (2) _________________________________________________________ (1) (Increases) decreases net realized investment gains (losses) on the consolidated statement of income (loss). (2) (Increases) decreases income tax expense on the consolidated statement of income (loss). (3) Increases (decreases) expenses on the consolidated statement of income (loss). |
Debt
Debt | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | DEBT Debt Issuance . On April 27, 2020, the Company issued $500 million aggregate principal amount of 2.55% senior notes that will mature on April 27, 2050. The net proceeds of the issuance, after the deduction of the underwriting discount and expenses payable by the Company, totaled approximately $490 million. Interest on the senior notes is payable semi-annually in arrears on April 27 and October 27. Prior to October 27, 2049, the senior notes may be redeemed, in whole or in part, at the Company’s option, at any time or from time to time, at a redemption price equal to the greater of (a) 100% of the principal amount of any senior notes to be redeemed or (b) the sum of the present values of the remaining scheduled payments of principal and interest to but excluding October 27, 2049 on any senior notes to be redeemed (exclusive of interest accrued to the date of redemption) discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the then current Treasury rate (as defined in the senior notes), plus 25 basis points. On or after October 27, 2049, the senior notes may be redeemed, in whole or in part, at the Company’s option, at any time or from time to time, at a redemption price equal to 100% of the principal amount of any senior notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. |
Common Share Repurchases
Common Share Repurchases | 6 Months Ended |
Jun. 30, 2020 | |
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | |
Common Share Repurchases | COMMON SHARE REPURCHASES During the three months ended June 30, 2020, the Company did not repurchase any common shares under its share repurchase authorization. For the six months ended June 30, 2020, the Company repurchased 3.5 million shares under its share repurchase authorization, for a total cost of $425 million. The average cost per share repurchased was $123.09. In addition, the Company acquired 368 shares and 0.3 million shares for a total cost of approximately $33,000 and $46 million during the three months and six months ended June 30, 2020, respectively, that were not part of the publicly announced share repurchase authorization. These shares consisted of shares retained to cover payroll withholding taxes in connection with the vesting of restricted stock unit awards and performance share awards, and shares used by employees to cover the price of certain stock options that were exercised. At June 30, 2020, the Company had $1.36 billion of capacity remaining under its share repurchase authorization. |
Earnings (Loss) per Share
Earnings (Loss) per Share | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share Reconciliation [Abstract] | |
Earnings (Loss) per Share | EARNINGS (LOSS) PER SHARE The following is a reconciliation of the income (loss) and share data used in the basic and diluted earnings (loss) per share computations for the periods presented: Three Months Ended Six Months Ended (in millions, except per share amounts) 2020 2019 2020 2019 Basic and Diluted Net income (loss), as reported $ (40) $ 557 $ 560 $ 1,353 Participating share-based awards — allocated income (1) (4) (3) (10) Net income (loss) available to common shareholders — basic and diluted $ (41) $ 553 $ 557 $ 1,343 Common Shares Basic Weighted average shares outstanding 251.6 261.3 253.6 262.1 Diluted Weighted average shares outstanding 251.6 261.3 253.6 262.1 Weighted average effects of dilutive securities — stock options and performance shares — 2.4 1.1 2.1 Total 251.6 263.7 254.7 264.2 Net Income (Loss) per Common Share Basic $ (0.16) $ 2.11 $ 2.19 $ 5.12 Diluted $ (0.16) $ 2.10 $ 2.19 $ 5.08 Net loss per basic and diluted common share for the three months ended June 30, 2020 excluded the allocation of $2 million of undistributed loss to participating share-based awards, since such allocation would result in anti-dilution of basic and diluted earnings per share for the three months ended June 30, 2020. In addition, the net loss per diluted common share for the three months ended June 30, 2020 excluded the weighted average effects of 0.7 million stock options and performance shares, since the impact of these potential shares of common stock and their effects on income was anti-dilutive for the three months ended June 30, 2020. |
Share-Based Incentive Compensat
Share-Based Incentive Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Incentive Compensation | SHARE-BASED INCENTIVE COMPENSATION The following information relates to fully vested stock option awards at June 30, 2020: Stock Options Number Weighted Weighted Aggregate Vested at end of period (1) 7,488,449 $ 114.26 5.8 years $ 56 Exercisable at end of period 5,167,407 $ 106.08 4.5 years $ 56 _________________________________________________________ (1) Represents awards for which the requisite service has been rendered, including those that are retirement eligible. The total compensation cost for all share-based incentive compensation awards recognized in earnings was $34 million and $35 million for the three months ended June 30, 2020 and 2019, respectively, and $80 million for each of the six months ended June 30, 2020 and 2019. The related tax benefits recognized in the consolidated statement of income (loss) were $6 million for each of the three months ended June 30, 2020 and 2019, and $14 million for each of the six months ended June 30, 2020 and 2019. The total unrecognized compensation cost related to all nonvested share-based incentive compensation awards at June 30, 2020 was $198 million, which is expected to be recognized over a weighted-average period of 2.0 years. |
Pension Plans, Retirement Benef
Pension Plans, Retirement Benefits and Savings Plans | 6 Months Ended |
Jun. 30, 2020 | |
Retirement Benefits [Abstract] | |
Pension Plans, Retirement Benefits and Savings Plans | PENSION PLANS, RETIREMENT BENEFITS AND SAVINGS PLANS The following table summarizes the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans recognized in the consolidated statement of income (loss) for the three months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the three months ended June 30, in millions) 2020 2019 2020 2019 Net Periodic Benefit Cost: Service cost $ 33 $ 29 $ — $ — Non-service cost (benefit): Interest cost on benefit obligation $ 28 $ 35 $ 1 $ 2 Expected return on plan assets (68) (68) — — Amortization of unrecognized: Prior service benefit — (1) — (1) Net actuarial (gain) loss 23 14 (1) — Total non-service cost (benefit) (17) (20) — 1 Net periodic benefit cost $ 16 $ 9 $ — $ 1 The following table indicates the line items in which the respective service cost and non-service cost (benefit) are presented in the consolidated statement of income (loss) for the three months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the three months ended June 30, in millions) 2020 2019 2020 2019 Service Cost: Claims and claim adjustment expenses $ 14 $ 12 $ — $ — General and administrative expenses 19 17 — — Total service cost 33 29 — — Non-Service Cost (Benefit): Claims and claim adjustment expenses (7) (8) — 1 General and administrative expenses (10) (12) — — Total non-service cost (benefit) (17) (20) — 1 Net periodic benefit cost $ 16 $ 9 $ — $ 1 The following table summarizes the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans recognized in the consolidated statement of income (loss) for the six months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the six months ended June 30, in millions) 2020 2019 2020 2019 Net Periodic Benefit Cost: Service cost $ 66 $ 59 $ — $ — Non-service cost (benefit): Interest cost on benefit obligation 57 70 2 4 Expected return on plan assets (137) (137) — — Amortization of unrecognized: Prior service benefit — (1) (2) (2) Net actuarial (gain) loss 46 28 (1) — Total non-service cost (benefit) (34) (40) (1) 2 Net periodic benefit cost (benefit) $ 32 $ 19 $ (1) $ 2 The following table indicates the line items in which the respective service costs and non-service benefit costs are presented in the consolidated statement of income (loss) for the six months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the six months ended June 30, in millions) 2020 2019 2020 2019 Service Cost: Claims and claim adjustment expenses $ 28 $ 24 $ — $ — General and administrative expenses 38 35 — — Total service cost 66 59 — — Non-Service Cost (Benefit): Claims and claim adjustment expenses (14) (16) — 1 General and administrative expenses (20) (24) (1) 1 Total non-service cost (benefit) (34) (40) (1) 2 Net periodic benefit cost (benefit) $ 32 $ 19 $ (1) $ 2 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Leases | LEASES The Company enters into lease agreements for real estate that is primarily used for office space in the ordinary course of business. These leases are accounted for as operating leases, whereby lease expense is recognized on a straight-line basis over the term of the lease, and a right-of-use asset and lease liability is recognized as part of other assets and other liabilities, respectively, in the consolidated balance sheet. Most leases include an option to extend or renew the lease term. The exercise of the renewal option is at the Company's discretion. The operating lease liability includes lease payments related to options to extend or renew the lease term if the Company is reasonably certain of exercising those options. The Company, in determining the present value of lease payments, utilizes either the rate implicit in the lease if that rate is readily determinable or the Company’s incremental secured borrowing rate commensurate with the term of the underlying lease. Lease expense is included in general and administrative expenses in the consolidated statement of income (loss). Additional information regarding the Company’s real estate operating leases is as follows: Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Lease cost Operating leases $ 24 $ 23 $ 48 $ 45 Short-term leases (1) 1 3 1 7 Lease expense 25 26 49 52 Less: sublease income (2) — — — — Net lease cost $ 25 $ 26 $ 49 $ 52 Other information on operating leases Cash payments to settle a lease liability reported in cash flows $ 28 $ 26 $ 55 $ 50 Right-of-use assets obtained in exchange for new lease liabilities $ 4 $ 28 $ 18 $ 36 Weighted average discount rate 2.94 % 3.05 % 2.94 % 3.05 % Weighted average remaining lease term 4.9 years 5.2 years 4.9 years 5.2 years _________________________________________________________ (1) Leases with an initial term of twelve months or less are not recorded on the balance sheet. (2) Sublease income consists of rent from third parties of office space and is recognized as part of other revenues in the consolidated statement of income (loss). The following table presents the contractual maturities of the Company's lease liabilities: (in millions) Real Estate Lease Liability Remainder of 2020 $ 53 2021 97 2022 74 2023 54 2024 38 Thereafter 57 Total undiscounted lease payments 373 Less: present value adjustment 27 Operating lease liability $ 346 |
Contingencies, Commitments and
Contingencies, Commitments and Guarantees | 6 Months Ended |
Jun. 30, 2020 | |
Contingencies, Commitments and Guarantees [Abstract] | |
Contingencies, Commitments and Guarantees | CONTINGENCIES, COMMITMENTS AND GUARANTEES Contingencies The major pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the Company or any of its subsidiaries is a party or to which any of the Company’s properties is subject are described below. Asbestos and Environmental Claims and Litigation In the ordinary course of its insurance business, the Company has received and continues to receive claims for insurance arising under policies issued by the Company asserting alleged injuries and damages from asbestos- and environmental-related exposures that are the subject of related coverage litigation. The Company is defending asbestos- and environmental-related litigation vigorously and believes that it has meritorious defenses; however, the outcomes of these disputes are uncertain. In this regard, the Company employs dedicated specialists and comprehensive resolution strategies to manage asbestos and environmental loss exposure, including settling litigation under appropriate circumstances. Currently, it is not possible to predict legal outcomes and their impact on future loss development for claims and litigation relating to asbestos and environmental claims. Any such development could be affected by future court decisions and interpretations, as well as future changes, if any, in applicable legislation. Because of these uncertainties, additional liabilities may arise for amounts in excess of the Company’s current insurance reserves. In addition, the Company’s estimate of ultimate claims and claim adjustment expenses may change. These additional liabilities or changes in estimates, or a range of either, cannot now be reasonably estimated and could result in income statement charges that could be material to the Company’s results of operations in future periods. Other Proceedings Not Arising Under Insurance Contracts or Reinsurance Agreements The Company is involved in other lawsuits, including lawsuits alleging extra-contractual damages relating to insurance contracts or reinsurance agreements, that do not arise under insurance contracts or reinsurance agreements. The legal costs associated with such lawsuits are expensed in the period in which the costs are incurred. Based upon currently available information, the Company does not believe it is reasonably possible that any such lawsuit or related lawsuits would be material to the Company’s results of operations or would have a material adverse effect on the Company’s financial position or liquidity. Other Commitments and Guarantees Commitments Investment Commitments — The Company has unfunded commitments to private equity limited partnerships and real estate partnerships in which it invests. These commitments totaled $1.63 billion and $1.66 billion at June 30, 2020 and December 31, 2019, respectively. Guarantees The maximum amount of the Company’s contingent obligation for indemnifications related to the sale of businesses that are quantifiable was $351 million at June 30, 2020. The maximum amount of the Company’s obligation related to the guarantee of certain insurance policy obligations of a former insurance subsidiary was $480 million at June 30, 2020, all of which is indemnified by a third party. For more information regarding Company guarantees, see note 16 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. |
Basis of Presentation and Acc_2
Basis of Presentation and Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation [Policy Text Block] | Basis of Presentation The interim consolidated financial statements include the accounts of The Travelers Companies, Inc. (together with its subsidiaries, the Company). These financial statements are prepared in conformity with U.S. generally accepted accounting principles (GAAP) and are unaudited. In the opinion of the Company’s management, all adjustments necessary for a fair presentation have been reflected. Certain financial information that is normally included in annual financial statements prepared in accordance with GAAP, but that is not required for interim reporting purposes, has been omitted. All material intercompany transactions and balances have been eliminated. The accompanying interim consolidated financial statements and related notes should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the Company’s 2019 Annual Report). The preparation of the interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements and the reported amounts of revenues and claims and expenses during the reporting period. Actual results could differ from those estimates. Certain reclassifications have been made to the 2019 financial statements to conform to the 2020 presentation. |
Adoption of Accounting Standards [Policy Text Block] | Adoption of Accounting Standards Registered Debt Offerings that Include Credit Enhancements from an Affiliate In March 2020, the Securities and Exchange Commission (SEC) adopted amendments to the financial disclosure requirements related to certain debt securities, including registered debt securities issued by a wholly-owned, operating subsidiary that are fully and unconditionally guaranteed by the parent company. Prior to the amendments, a parent guarantor was required to provide condensed consolidating financial information for so long as the guaranteed securities were outstanding, regardless of whether the subsidiary issuer could have suspended its public reporting obligations under the applicable SEC requirements with respect to the securities. In accordance with the amended requirements, a parent guarantor may cease providing the condensed consolidating financial information if the corresponding subsidiary issuer’s public reporting obligation is suspended. The amendments to the financial disclosure requirements are effective on January 4, 2021; however, the SEC permits voluntary compliance in advance of the effective date. The Company elected to apply the amended requirements beginning with the quarter ended March 31, 2020, and is no longer providing condensed consolidating financial information that resulted from the registered debt obligations of its subsidiaries, Travelers Property Casualty Corp. and Travelers Insurance Group Holdings Inc., that were disclosed in note 8 of the financial statements in the Company’s 2019 Annual Report . Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments In June 2016, the Financial Accounting Standards Board issued updated guidance for the accounting for credit losses for financial instruments. The updated guidance applies a new credit loss model (current expected credit losses or CECL) for determining credit-related impairments for financial instruments measured at amortized cost (including reinsurance recoverables and structured settlements that are recorded as part of reinsurance recoverables) and requires an entity to estimate the credit losses expected over the life of an exposure or pool of exposures. The estimate of expected credit losses should consider historical information, current information, as well as reasonable and supportable forecasts, including estimates of prepayments. The expected credit losses, and subsequent adjustments to such losses, are recorded through an allowance account that is deducted from the amortized cost basis of the financial asset, with the net carrying value of the financial asset presented on the consolidated balance sheet at the amount expected to be collected. The updated guidance also amends the previous other-than-temporary impairment model for available-for-sale debt securities by requiring the recognition of impairments relating to credit losses through an allowance account and limits the amount of credit loss to the difference between a security’s amortized cost basis and its fair value. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The Company adopted the updated guidance for the quarter ended March 31, 2020. For available-for-sale debt securities, the updated guidance was applied prospectively. For financial instruments measured at amortized cost, the updated guidance was applied by a cumulative effect adjustment to the opening balance of retained earnings as of January 1, 2020, the beginning of the period of adoption. The adoption of this guidance resulted in the recognition of an after-tax cumulative effect adjustment of $43 million to reflect the impact of recognizing expected credit losses, as compared to incurred credit losses recognized under the previous guidance. This adjustment is primarily associated with structured settlements that are recorded as part of reinsurance recoverables. The cumulative effect adjustment decreased retained earnings as of January 1, 2020 and increased the allowance for estimated uncollectible reinsurance. For additional information regarding accounting standards that the Company adopted during the periods presented, see note 1 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. |
Investment Impairments [Policy Text Block] | Investment Impairments The Company conducts a periodic review to identify and evaluate invested assets that may have credit impairments. Credit Impairments of Fixed Maturity Investments Some of the factors considered in assessing impairment of fixed maturity investments due to credit-related factors include: (1) the extent to which the fair value has been less than amortized cost; (2) the financial condition, near-term and long-term prospects for the issuer, including the relevant industry conditions and trends, and implications of rating agency actions and offering prices; (3) the likelihood of the recoverability of principal and interest; and (4) whether it is more likely than not that the Company will be required to sell the investment prior to an anticipated recovery in value. Beginning on January 1, 2020, credit losses are recognized through an allowance account. See note 1 - Adoption of Accounting Standards - Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments for additional information. For fixed maturity investments that the Company does not intend to sell or for which it is more likely than not that the Company would not be required to sell before an anticipated recovery in value, the Company separates the credit loss component of the impairment from the amount related to all other factors and reports the credit loss component in net realized investment gains (losses). The impairment related to all other factors (non-credit factors) is reported in other comprehensive income. The allowance is adjusted for any additional credit losses and subsequent recoveries. Upon recognizing a credit loss, the cost basis is not adjusted. For fixed maturity investments where the Company records a credit loss, a determination is made as to the cause of the impairment and whether the Company expects a recovery in the value. For fixed maturity investments where the Company expects a recovery in value, the constant effective yield method is utilized, and the investment is amortized to par. For fixed maturity investments the Company intends to sell or for which it is more likely than not that the Company will be required to sell before an anticipated recovery in value, the full amount of the impairment is included in net realized investment gains (losses). The new cost basis of the investment is the previous amortized cost basis less the impairment recognized in net realized investment gains (losses). The new cost basis is not adjusted for any subsequent recoveries in fair value. The Company reports investment income accrued separately from fixed maturity investments, available for sale, and has elected not to measure an allowance for credit losses for investment income accrued. Investment income accrued is written off through net realized investment gains (losses) at the time the issuer of the bond defaults or is expected to default on payments. Uncollectible available-for-sale debt securities are written-off when the Company determines that no additional payments of principle or interest will be received. |
Reinsurance Recoverables [Policy Text Block] | Reinsurance Recoverables Amounts recoverable from reinsurers are estimated in a manner consistent with the associated claim liability. Included in reinsurance recoverables are amounts related to certain structured settlements. The Company reports its reinsurance recoverables net of an allowance for estimated uncollectible reinsurance. The allowance is based upon the Company’s ongoing review of amounts outstanding, length of collection periods, changes in reinsurer credit standing, disputes, applicable coverage defenses and other relevant factors. For structured settlements, the allowance is also based upon the Company’s ongoing review of life insurers’ creditworthiness and estimated amounts of coverage that would be available from state guaranty funds if a life insurer defaults. A probability-of-default methodology which reflects current and forecasted economic conditions is used to estimate the amount of uncollectible reinsurance due to credit-related factors and the estimate is reported in an allowance for estimated uncollectible reinsurance. The allowance also includes estimated uncollectible amounts related to dispute risk with reinsurers. Amounts deemed to be uncollectible, including amounts due from known insolvent reinsurers, are written off against the allowance. Changes in the allowance, as well as any subsequent collections of amounts previously written off, are reported as part of claims and claim adjustment expenses. The Company evaluates and monitors the financial condition of its reinsurers under voluntary reinsurance arrangements to minimize its exposure to significant losses from reinsurer insolvencies. |
Contractholder Receivables and Payables [Policy Text Block] | Contractholder Receivables and Payables Under certain workers’ compensation insurance contracts with deductible features, the Company is obligated to pay the claimant for the full amount of the claim. The Company is subsequently reimbursed by the policyholder for the deductible amount. These amounts are included on a gross basis in the consolidated balance sheet in both contractholder payables and contractholder receivables. Contractholder receivables are reported net of an allowance for expected credit losses. The allowance is based upon the Company’s ongoing review of amounts outstanding, changes in policyholder credit standing, and other relevant factors. A probability-of-default methodology which reflects current and forecasted economic conditions is used to estimate the allowance for expected credit losses. |
Premiums and Unearned Premium Reserves [Policy Text Block] | Premiums and Unearned Premium Reserves Premiums are recognized as revenues pro rata over the policy period. Unearned premium reserves represent the unexpired portion of policy premiums. Accrued retrospective premiums are included in premium balances receivable. Premium balances receivable are reported net of an allowance for expected credit losses. The allowance is based upon the Company’s ongoing review of amounts outstanding, historical loss data, including delinquencies and write-offs, current and forecasted economic conditions and other relevant factors. Credit risk is partially mitigated by the Company’s ability to cancel the policy if the policyholder does not pay the premium. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Company's revenues and income by segment [Table Text Block] | (For the three months ended June 30, in millions) Business Bond & Specialty Personal Total 2020 Premiums $ 3,735 $ 693 $ 2,527 $ 6,955 Net investment income 180 42 46 268 Fee income 108 — 6 114 Other revenues 36 5 10 51 Total segment revenues (1) $ 4,059 $ 740 $ 2,589 $ 7,388 Segment income (loss) (1) $ (58) $ 72 $ 10 $ 24 2019 Premiums $ 3,783 $ 632 $ 2,573 $ 6,988 Net investment income 481 58 109 648 Fee income 111 — 5 116 Other revenues 30 6 21 57 Total segment revenues (1) $ 4,405 $ 696 $ 2,708 $ 7,809 Segment income (1) $ 351 $ 174 $ 88 $ 613 _________________________________________________________ (1) Segment revenues for reportable business segments exclude net realized investment gains (losses) and revenues included in "interest expense and other." Segment income (loss) for reportable business segments equals net income (loss) excluding the after-tax impact of net realized investment gains (losses) and income (loss) from "interest expense and other." (For the six months ended June 30, in millions) Business Bond & Specialty Personal Total 2020 Premiums $ 7,599 $ 1,360 $ 5,225 $ 14,184 Net investment income 633 97 149 879 Fee income 210 — 12 222 Other revenues 67 10 32 109 Total segment revenues (1) $ 8,509 $ 1,467 $ 5,418 $ 15,394 Segment income (1) $ 231 $ 194 $ 346 $ 771 2019 Premiums $ 7,525 $ 1,238 $ 5,080 $ 13,843 Net investment income 908 114 208 1,230 Fee income 215 — 10 225 Other revenues 73 12 43 128 Total segment revenues (1) $ 8,721 $ 1,364 $ 5,341 $ 15,426 Segment income (1) $ 765 $ 312 $ 366 $ 1,443 _________________________________________________________ (1) Segment revenues for reportable business segments exclude net realized investment gains (losses) and revenues included in "interest expense and other." Segment income (loss) for reportable business segments equals net income excluding the after-tax impact of net realized investment gains (losses) and income (loss) from "interest expense and other." |
Business segment reconciliations of revenue and income, net of tax [Table Text Block] | Business Segment Reconciliations Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Revenue reconciliation Earned premiums Business Insurance: Domestic: Workers’ compensation $ 818 $ 950 $ 1,717 $ 1,922 Commercial automobile 676 647 1,360 1,275 Commercial property 514 473 1,022 933 General liability 580 585 1,181 1,152 Commercial multi-peril 883 856 1,769 1,696 Other 11 9 23 17 Total Domestic 3,482 3,520 7,072 6,995 International 253 263 527 530 Total Business Insurance 3,735 3,783 7,599 7,525 Bond & Specialty Insurance: Domestic: Fidelity and surety 271 258 528 504 General liability 296 266 583 523 Other 60 53 118 105 Total Domestic 627 577 1,229 1,132 International 66 55 131 106 Total Bond & Specialty Insurance 693 632 1,360 1,238 Personal Insurance: Domestic: Automobile 1,154 1,321 2,505 2,618 Homeowners and Other 1,221 1,078 2,397 2,117 Total Domestic 2,375 2,399 4,902 4,735 International 152 174 323 345 Total Personal Insurance 2,527 2,573 5,225 5,080 Total earned premiums 6,955 6,988 14,184 13,843 Net investment income 268 648 879 1,230 Fee income 114 116 222 225 Other revenues 51 57 109 128 Total segment revenues 7,388 7,809 15,394 15,426 Other revenues — — — 1 Net realized investment gains (losses) 13 25 (85) 78 Total revenues $ 7,401 $ 7,834 $ 15,309 $ 15,505 Income reconciliation, net of tax Total segment income $ 24 $ 613 $ 771 $ 1,443 Interest Expense and Other (1) (74) (76) (145) (151) Core income (loss) (50) 537 626 1,292 Net realized investment gains (losses) 10 20 (66) 61 Net income (loss) $ (40) $ 557 $ 560 $ 1,353 _________________________________________________________ (1) The primary component of Interest Expense and Other was after-tax interest expense of $67 million and $70 million for the three months ended June 30, 2020 and 2019, respectively, and $133 million and $140 million for the six months ended June 30, 2020 and 2019, respectively. |
Asset reconciliation [Table Text Block] | (in millions) June 30, December 31, Asset reconciliation Business Insurance $ 86,136 $ 83,896 Bond & Specialty Insurance 9,155 8,599 Personal Insurance 17,427 17,015 Total assets by reportable segment 112,718 109,510 Other assets (1) 619 612 Total consolidated assets $ 113,337 $ 110,122 _________________________________________________________ (1) The primary components of other assets at both June 30, 2020 and December 31, 2019 were accrued over-funded benefit plan assets related to the Company’s qualified domestic pension plan and other intangible assets. |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Investments [Abstract] | |
Amortized cost and fair value of investments in fixed maturities [Table Text Block] | The amortized cost and fair value of investments in fixed maturities classified as available for sale were as follows: Amortized Cost Allowance for Expected Credit Losses Gross Unrealized Fair Value (at June 30, 2020, in millions) Gains Losses U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,046 $ — $ 49 $ — $ 2,095 Obligations of states, municipalities and political subdivisions: Local general obligation 16,040 — 1,225 1 17,264 Revenue 10,298 — 818 — 11,116 State general obligation 1,144 — 83 — 1,227 Pre-refunded 2,328 — 133 — 2,461 Total obligations of states, municipalities and political subdivisions 29,810 — 2,259 1 32,068 Debt securities issued by foreign governments 1,023 — 28 — 1,051 Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 2,910 — 174 — 3,084 All other corporate bonds 29,619 8 2,184 62 31,733 Redeemable preferred stock 22 — 1 — 23 Total $ 65,430 $ 8 $ 4,695 $ 63 $ 70,054 Amortized Gross Unrealized Fair (at December 31, 2019, in millions) Cost Gains Losses Value U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,076 $ 19 $ — $ 2,095 Obligations of states, municipalities and political subdivisions: Local general obligation 15,490 829 4 16,315 Revenue 9,731 586 2 10,315 State general obligation 1,167 64 — 1,231 Pre-refunded 1,968 88 — 2,056 Total obligations of states, municipalities and political subdivisions 28,356 1,567 6 29,917 Debt securities issued by foreign governments 1,167 8 2 1,173 Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 3,192 91 3 3,280 All other corporate bonds 30,442 1,195 18 31,619 Redeemable preferred stock 48 2 — 50 Total $ 65,281 $ 2,882 $ 29 $ 68,134 |
Cost and fair value of investments in equity securities [Table Text Block] | The cost and fair value of investments in equity securities were as follows: Fair (at June 30, 2020, in millions) Cost Gross Gains Gross Losses Value Public common stock $ 344 $ 30 $ 23 $ 351 Non-redeemable preferred stock 34 6 1 39 Total $ 378 $ 36 $ 24 $ 390 Fair (at December 31, 2019, in millions) Cost Gross Gains Gross Losses Value Public common stock $ 341 $ 45 $ 3 $ 383 Non-redeemable preferred stock 35 7 — 42 Total $ 376 $ 52 $ 3 $ 425 |
Unrealized investment losses [Table Text Block] | The following tables summarize, for all investments in an unrealized loss position at June 30, 2020 and December 31, 2019, the aggregate fair value and gross unrealized loss by length of time those securities have been continuously in an unrealized loss position. The fair value amounts reported in the tables are estimates that are prepared using the process described in note 4 herein and in note 4 of notes to the consolidated financial statements in the Company’s 2019 Annual Report. The Company also relies upon estimates of several credit and non-credit factors in its review and evaluation of individual investments, using the process described in note 1 of notes to the consolidated financial statements to determine whether credit impairment exists. Less than 12 months 12 months or longer Total (at June 30, 2020, in millions) Fair Gross Fair Gross Fair Gross Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 46 $ — $ — $ — $ 46 $ — Obligations of states, municipalities and political subdivisions 334 1 — — 334 1 Debt securities issued by foreign governments 12 — — — 12 — Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 25 — 2 — 27 — All other corporate bonds 1,079 51 141 11 1,220 62 Total $ 1,496 $ 52 $ 143 $ 11 $ 1,639 $ 63 Less than 12 months 12 months or longer Total (at December 31, 2019, in millions) Fair Gross Fair Gross Fair Gross Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 5 $ — $ 193 $ — $ 198 $ — Obligations of states, municipalities and political subdivisions 668 6 12 — 680 6 Debt securities issued by foreign governments 257 1 147 1 404 2 Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 399 2 131 1 530 3 All other corporate bonds 1,571 10 662 8 2,233 18 Total $ 2,900 $ 19 $ 1,145 $ 10 $ 4,045 $ 29 |
Reconciliation of of the beginning and ending balances of the allowance for expected credit losses on fixed maturities classified as available-for-sale [Table Text Block] | The following tables present changes in the allowance for expected credit losses on fixed maturities classified as available for sale: Fixed Maturities (for the three months ended June 30, 2020 in millions) Mortgage-Backed Securities, Collateralized Mortgage Obligations and Pass-Through Securities All Other Corporate Bonds Total Balance, April 1, 2020 $ — $ 4 $ 4 Additions for expected credit losses on securities where no credit losses were previously recognized — 4 4 Additions (reductions) for expected credit losses on securities where credit losses were previously recognized — — — Reductions due to sales/defaults of credit-impaired securities — — — Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell (1) — — — Balance, June 30, 2020 $ — $ 8 $ 8 ___________________________________________________________________________________ (1) Credit impairment charges recognized in net realized investment gains (losses) for the three months ended June 30, 2020 included $2 million of credit losses on fixed maturity securities which the Company intends to sell. An allowance for expected credit losses was not previously recorded for these securities. Fixed Maturities (for the six months ended June 30, 2020 in millions) Mortgage-Backed Securities, Collateralized Mortgage Obligations and Pass-Through Securities All Other Corporate Bonds Total Balance, January 1, 2020 $ — $ — $ — Additions for expected credit losses on securities where no credit losses were previously recognized — 8 8 Additions (reductions) for expected credit losses on securities where credit losses were previously recognized — — — Reductions due to sales/defaults of credit-impaired securities — — — Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell (1) — — — Balance, June 30, 2020 $ — $ 8 $ 8 _________________________________________________________ (1) Credit impairment charges recognized in net realized investment gains (losses) for the six months ended June 30, 2020 included $14 million credit losses on fixed maturity securities which the Company intends to sell. An allowance for expected credit losses was not previously recorded for these securities. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities reported at fair value are measured on a recurring basis [Table Text Block] | The following tables present the level within the fair value hierarchy at which the Company’s financial assets and financial liabilities are measured on a recurring basis. (at June 30, 2020, in millions) Total Level 1 Level 2 Level 3 Invested assets: Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,095 $ 2,095 $ — $ — Obligations of states, municipalities and political subdivisions 32,068 — 32,056 12 Debt securities issued by foreign governments 1,051 — 1,051 — Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 3,084 — 3,084 — All other corporate bonds 31,733 2 31,651 80 Redeemable preferred stock 23 — 23 — Total fixed maturities 70,054 2,097 67,865 92 Equity securities Public common stock 351 351 — — Non-redeemable preferred stock 39 10 29 — Total equity securities 390 361 29 — Other investments 32 14 — 18 Total $ 70,476 $ 2,472 $ 67,894 $ 110 Other liabilities $ 7 $ — $ — $ 7 (at December 31, 2019, in millions) Total Level 1 Level 2 Level 3 Invested assets: Fixed maturities U.S. Treasury securities and obligations of U.S. government and government agencies and authorities $ 2,095 $ 2,095 $ — $ — Obligations of states, municipalities and political subdivisions 29,917 — 29,905 12 Debt securities issued by foreign governments 1,173 — 1,173 — Mortgage-backed securities, collateralized mortgage obligations and pass-through securities 3,280 — 3,280 — All other corporate bonds 31,619 — 31,530 89 Redeemable preferred stock 50 — 50 — Total fixed maturities 68,134 2,095 65,938 101 Equity securities Public common stock 383 383 — — Non-redeemable preferred stock 42 13 29 — Total equity securities 425 396 29 — Other investments 36 16 — 20 Total $ 68,595 $ 2,507 $ 65,967 $ 121 Other liabilities $ 8 $ — $ — $ 8 |
Carrying value and fair value of financial instruments disclosed, but not carried, at fair value and the level within the fair value hierarchy at which such financial instruments are categorized [Table Text Block] | The following tables present the carrying value and fair value of the Company’s financial assets and financial liabilities disclosed, but not carried, at fair value, and the level within the fair value hierarchy at which such assets and liabilities are categorized. (at June 30, 2020, in millions) Carrying Fair Level 1 Level 2 Level 3 Financial assets Short-term securities $ 6,087 $ 6,087 $ 2,139 $ 3,898 $ 50 Financial liabilities Debt $ 6,949 $ 9,059 $ — $ 9,059 $ — Commercial paper $ 100 $ 100 $ — $ 100 $ — (at December 31, 2019, in millions) Carrying Fair Level 1 Level 2 Level 3 Financial assets Short-term securities $ 4,943 $ 4,943 $ 685 $ 4,204 $ 54 Financial liabilities Debt $ 6,458 $ 8,049 $ — $ 8,049 $ — Commercial paper $ 100 $ 100 $ — $ 100 $ — |
Allowance for Expected Credit_2
Allowance for Expected Credit Losses (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Credit Loss [Abstract] | |
Changes in the allowance for expected credit losses on premiums receivable [Table Text Block] | The following tables present the balances of premiums receivable, net of the allowance for expected credit losses, at June 30, 2020 and January 1, 2020, and the changes in the allowance for expected credit losses for the three months and six months ended June 30, 2020. At and For the Three Months Ended June 30, 2020 At and For the Six Months Ended June 30, 2020 (in millions) Premiums Receivable, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Premiums Receivable, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Balance, beginning of period $ 8,202 $ 78 $ 7,909 $ 49 Current period change for expected credit losses 24 67 Write-offs of uncollectible premiums receivable 8 22 Balance, end of period $ 8,459 $ 94 $ 8,459 $ 94 |
Changes in the allowance for estimated uncollectible reinsurance [Table Text Block] | The following tables present the balances of reinsurance recoverables, net of the allowance for estimated uncollectible reinsurance, at June 30, 2020 and January 1, 2020, and the changes in the allowance for estimated uncollectible reinsurance for the three months and six months ended June 30, 2020. At and For the Three Months Ended June 30, 2020 At and For the Six Months Ended June 30, 2020 (in millions) Reinsurance Recoverables, Net of Allowance for Estimated Uncollectible Reinsurance Allowance for Estimated Uncollectible Reinsurance Reinsurance Recoverables, Net of Allowance for Estimated Uncollectible Reinsurance Allowance for Estimated Uncollectible Reinsurance Balance, beginning of period $ 8,152 $ 149 $ 8,235 $ 92 Cumulative effect of adoption of updated accounting guidance for credit losses at January 1, 2020 — 53 Current period change for estimated uncollectible reinsurance 7 11 Write-offs of uncollectible reinsurance recoverables — — Balance, end of period $ 8,093 $ 156 $ 8,093 156 |
Changes in the allowance for expected credit losses on contractholder receivables [Table Text Block] | The following tables present the balances of contractholder receivables, net of the allowance for expected credit losses, at June 30, 2020 and January 1, 2020, and the changes in the allowance for expected credit losses for the three months and six months ended June 30, 2020. At and For the Three Months Ended June 30, 2020 At and For the Six Months Ended June 30, 2020 (in millions) Contractholder Receivables, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Contractholder Receivables, Net of Allowance for Expected Credit Losses Allowance for Expected Credit Losses Balance, beginning of period $ 4,634 $ 20 $ 4,599 $ 20 Current period change for expected credit losses 2 2 Write-offs of uncollectible contractholder receivables — — Balance, end of period $ 4,314 $ 22 $ 4,314 $ 22 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill by segment [Table Text Block] | The following table presents the carrying amount of the Company’s goodwill by segment. Each reportable segment includes goodwill associated with the Company’s international business which is subject to the impact of changes in foreign currency exchange rates. (in millions) June 30, December 31, Business Insurance $ 2,573 $ 2,601 Bond & Specialty Insurance 550 550 Personal Insurance 776 784 Other 26 26 Total $ 3,925 $ 3,961 |
Other intangible assets subject to amortization [Table Text Block] | The following tables present a summary of the Company’s other intangible assets by major asset class. (at June 30, 2020, in millions) Gross Accumulated Net Subject to amortization Customer-related $ 95 $ 25 $ 70 Contract-based (1) 204 181 23 Total subject to amortization 299 206 93 Not subject to amortization 226 — 226 Total $ 525 $ 206 $ 319 (at December 31, 2019, in millions) Gross Accumulated Net Subject to amortization Customer-related $ 99 $ 21 $ 78 Contract-based (1) 205 179 26 Total subject to amortization 304 200 104 Not subject to amortization 226 — 226 Total $ 530 $ 200 $ 330 _________________________________________________________ (1) Contract-based intangible assets subject to amortization are comprised of fair value adjustments on claims and claim adjustment expense reserves, reinsurance recoverables and other contract-related intangible assets. Fair value adjustments recorded in connection with insurance acquisitions were based on management’s estimate of nominal claims and claim adjustment expense reserves and reinsurance recoverables. The method used calculated a risk adjustment to a risk-free discounted reserve that would, if reserves ran off as expected, produce results that yielded the assumed cost-of-capital on the capital supporting the loss reserves. The fair value adjustments are reported as other intangible assets on the consolidated balance sheet, and the amounts measured in accordance with the acquirer’s accounting policies for insurance contracts have been reported as part of the claims and claim adjustment expense reserves and reinsurance recoverables. The intangible assets are being recognized into income over the expected payment pattern. Because the time value of money and the risk adjustment (cost of capital) components of the intangible assets run off at different rates, the amount recognized in income may be a net benefit in some periods and a net expense in other periods. |
Other intangible assets not subject to amortization [Table Text Block] | The following tables present a summary of the Company’s other intangible assets by major asset class. (at June 30, 2020, in millions) Gross Accumulated Net Subject to amortization Customer-related $ 95 $ 25 $ 70 Contract-based (1) 204 181 23 Total subject to amortization 299 206 93 Not subject to amortization 226 — 226 Total $ 525 $ 206 $ 319 (at December 31, 2019, in millions) Gross Accumulated Net Subject to amortization Customer-related $ 99 $ 21 $ 78 Contract-based (1) 205 179 26 Total subject to amortization 304 200 104 Not subject to amortization 226 — 226 Total $ 530 $ 200 $ 330 _________________________________________________________ (1) Contract-based intangible assets subject to amortization are comprised of fair value adjustments on claims and claim adjustment expense reserves, reinsurance recoverables and other contract-related intangible assets. Fair value adjustments recorded in connection with insurance acquisitions were based on management’s estimate of nominal claims and claim adjustment expense reserves and reinsurance recoverables. The method used calculated a risk adjustment to a risk-free discounted reserve that would, if reserves ran off as expected, produce results that yielded the assumed cost-of-capital on the capital supporting the loss reserves. The fair value adjustments are reported as other intangible assets on the consolidated balance sheet, and the amounts measured in accordance with the acquirer’s accounting policies for insurance contracts have been reported as part of the claims and claim adjustment expense reserves and reinsurance recoverables. The intangible assets are being recognized into income over the expected payment pattern. Because the time value of money and the risk adjustment (cost of capital) components of the intangible assets run off at different rates, the amount recognized in income may be a net benefit in some periods and a net expense in other periods. |
Insurance Claim Reserves (Table
Insurance Claim Reserves (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Insurance Loss Reserves [Abstract] | |
Claims and claim adjustment expense reserves [Table Text Block] | Claims and claim adjustment expense reserves were as follows: (in millions) June 30, December 31, Property-casualty $ 53,097 $ 51,836 Accident and health 12 13 Total $ 53,109 $ 51,849 |
Reconciliation of beginning and ending property casualty reserve balances for claims and claim adjustment expenses [Table Text Block] | The following table presents a reconciliation of beginning and ending property casualty reserve balances for claims and claim adjustment expenses: Six Months Ended June 30, (in millions) 2020 2019 Claims and claim adjustment expense reserves at beginning of year $ 51,836 $ 50,653 Less reinsurance recoverables on unpaid losses 8,035 8,182 Cumulative effect of adoption of updated accounting guidance for credit losses at January 1, 2020 53 — Net reserves at beginning of year 43,854 42,471 Estimated claims and claim adjustment expenses for claims arising in the current year 9,826 9,329 Estimated increase (decrease) in claims and claim adjustment expenses for claims arising in prior years 16 (118) Total increases 9,842 9,211 Claims and claim adjustment expense payments for claims arising in: Current year 2,664 2,810 Prior years 5,674 5,897 Total payments 8,338 8,707 Unrealized foreign exchange (gain) loss (137) 62 Net reserves at end of period 45,221 43,037 Plus reinsurance recoverables on unpaid losses 7,876 8,022 Claims and claim adjustment expense reserves at end of period $ 53,097 $ 51,059 |
Other Comprehensive Income an_2
Other Comprehensive Income and Accumulated Other Comprehensive Income (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Other Comprehensive Income And Accumulated Other Comprehensive Income Disclosure [Abstract] | |
Changes in accumulated other comprehensive income (loss) (AOCI) [Table Text Block] | The following tables present the changes in the Company’s accumulated other comprehensive income (loss) (AOCI) for the three months and six months ended June 30, 2020. Changes in Net Unrealized Gains on Investment Securities (in millions) Having No Credit Having Credit Net Benefit Plan Assets and Net Unrealized Total Accumulated Balance, March 31, 2020 $ 1,600 $ 185 $ (828) $ (1,006) $ (49) Other comprehensive income (loss) (OCI) before reclassifications, net of tax 1,867 2 — 53 1,922 Amounts reclassified from AOCI, net of tax (8) — 17 — 9 Net OCI, current period 1,859 2 17 53 1,931 Balance, June 30, 2020 $ 3,459 $ 187 $ (811) $ (953) $ 1,882 Changes in Net Unrealized Gains on Investment Securities (in millions) Having No Credit Losses Recognized in the Consolidated Statement of Income (Loss) Having Credit Net Benefit Plan Assets and Obligations Recognized in Shareholders’ Equity Net Unrealized Foreign Currency Translation Total Accumulated Other Comprehensive Income Balance, December 31, 2019 $ 2,057 $ 189 $ (846) $ (760) $ 640 Other comprehensive income (loss) (OCI) before reclassifications, net of tax 1,408 (2) 1 (193) 1,214 Amounts reclassified from AOCI, net of tax (6) — 34 — 28 Net OCI, current period 1,402 (2) 35 (193) 1,242 Balance, June 30, 2020 $ 3,459 $ 187 $ (811) $ (953) $ 1,882 |
Pre-tax components of other comprehensive income (loss) and the related income tax expense (benefit) for each component [Table Text Block] | The following table presents the pre-tax components of the Company’s other comprehensive income and the related income tax expense. Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Changes in net unrealized gains on investment securities: Having no credit losses recognized in the consolidated statement of income (loss) $ 2,359 $ 1,108 $ 1,784 $ 2,524 Income tax expense 500 234 382 534 Net of taxes 1,859 874 1,402 1,990 Having credit losses recognized in the consolidated statement of income (loss) 3 (4) (3) 1 Income tax expense (benefit) 1 (1) (1) — Net of taxes 2 (3) (2) 1 Net changes in benefit plan assets and obligations 21 14 44 26 Income tax expense 4 3 9 5 Net of taxes 17 11 35 21 Net changes in unrealized foreign currency translation 52 5 (216) 55 Income tax expense (benefit) (1) (1) (23) 2 Net of taxes 53 6 (193) 53 Total other comprehensive income 2,435 1,123 1,609 2,606 Total income tax expense 504 235 367 541 Total other comprehensive income, net of taxes $ 1,931 $ 888 $ 1,242 $ 2,065 |
Pre-tax and related income tax (expense) benefit components of the amounts reclassified from accumulated other comprehensive income to the consolidated statement of income (loss) [Table Text Block] | The following table presents the pre-tax and related income tax (expense) benefit components of the amounts reclassified from the Company’s AOCI to the Company’s consolidated statement of income (loss). Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Reclassification adjustments related to unrealized gains on investment securities: Having no credit losses recognized in the consolidated statement of income (loss) (1) $ (10) $ (13) $ (8) $ (29) Income tax expense (2) (2) (3) (2) (6) Net of taxes (8) (10) (6) (23) Having credit losses recognized in the consolidated statement of income (loss) (1) — — — — Income tax benefit (2) — — — — Net of taxes — — — — Reclassification adjustment related to benefit plan assets and obligations: Claims and claim adjustment expenses (3) 9 6 18 11 General and administrative expenses (3) 13 7 25 15 Total 22 13 43 26 Income tax benefit (2) 5 2 9 5 Net of taxes 17 11 34 21 Reclassification adjustment related to foreign currency translation (1) — — — — Income tax benefit (2) — — — — Net of taxes — — — — Total reclassifications 12 — 35 (3) Total income tax (expense) benefit 3 (1) 7 (1) Total reclassifications, net of taxes $ 9 $ 1 $ 28 $ (2) _________________________________________________________ (1) (Increases) decreases net realized investment gains (losses) on the consolidated statement of income (loss). (2) (Increases) decreases income tax expense on the consolidated statement of income (loss). (3) Increases (decreases) expenses on the consolidated statement of income (loss). |
Earnings (Loss) per Share (Tabl
Earnings (Loss) per Share (Table) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share Reconciliation [Abstract] | |
Earnings (loss) per share reconciliation [Table Text Block] | The following is a reconciliation of the income (loss) and share data used in the basic and diluted earnings (loss) per share computations for the periods presented: Three Months Ended Six Months Ended (in millions, except per share amounts) 2020 2019 2020 2019 Basic and Diluted Net income (loss), as reported $ (40) $ 557 $ 560 $ 1,353 Participating share-based awards — allocated income (1) (4) (3) (10) Net income (loss) available to common shareholders — basic and diluted $ (41) $ 553 $ 557 $ 1,343 Common Shares Basic Weighted average shares outstanding 251.6 261.3 253.6 262.1 Diluted Weighted average shares outstanding 251.6 261.3 253.6 262.1 Weighted average effects of dilutive securities — stock options and performance shares — 2.4 1.1 2.1 Total 251.6 263.7 254.7 264.2 Net Income (Loss) per Common Share Basic $ (0.16) $ 2.11 $ 2.19 $ 5.12 Diluted $ (0.16) $ 2.10 $ 2.19 $ 5.08 |
Share-Based Incentive Compens_2
Share-Based Incentive Compensation (Table) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Information for fully vested stock option awards [Table Text Block] | The following information relates to fully vested stock option awards at June 30, 2020: Stock Options Number Weighted Weighted Aggregate Vested at end of period (1) 7,488,449 $ 114.26 5.8 years $ 56 Exercisable at end of period 5,167,407 $ 106.08 4.5 years $ 56 _________________________________________________________ (1) Represents awards for which the requisite service has been rendered, including those that are retirement eligible. |
Pension Plans, Retirement Ben_2
Pension Plans, Retirement Benefits and Savings Plans (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Retirement Benefits [Abstract] | |
Summary of the components of net periodic benefit cost for the Company's pension and postretirement benefit plans recognized in the consolidated statement of income [Table Text Block] | The following table summarizes the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans recognized in the consolidated statement of income (loss) for the three months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the three months ended June 30, in millions) 2020 2019 2020 2019 Net Periodic Benefit Cost: Service cost $ 33 $ 29 $ — $ — Non-service cost (benefit): Interest cost on benefit obligation $ 28 $ 35 $ 1 $ 2 Expected return on plan assets (68) (68) — — Amortization of unrecognized: Prior service benefit — (1) — (1) Net actuarial (gain) loss 23 14 (1) — Total non-service cost (benefit) (17) (20) — 1 Net periodic benefit cost $ 16 $ 9 $ — $ 1 The following table summarizes the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans recognized in the consolidated statement of income (loss) for the six months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the six months ended June 30, in millions) 2020 2019 2020 2019 Net Periodic Benefit Cost: Service cost $ 66 $ 59 $ — $ — Non-service cost (benefit): Interest cost on benefit obligation 57 70 2 4 Expected return on plan assets (137) (137) — — Amortization of unrecognized: Prior service benefit — (1) (2) (2) Net actuarial (gain) loss 46 28 (1) — Total non-service cost (benefit) (34) (40) (1) 2 Net periodic benefit cost (benefit) $ 32 $ 19 $ (1) $ 2 |
Consolidated statement of income line items impacted by service costs and non-service benefit costs [Table Text Block] | The following table indicates the line items in which the respective service cost and non-service cost (benefit) are presented in the consolidated statement of income (loss) for the three months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the three months ended June 30, in millions) 2020 2019 2020 2019 Service Cost: Claims and claim adjustment expenses $ 14 $ 12 $ — $ — General and administrative expenses 19 17 — — Total service cost 33 29 — — Non-Service Cost (Benefit): Claims and claim adjustment expenses (7) (8) — 1 General and administrative expenses (10) (12) — — Total non-service cost (benefit) (17) (20) — 1 Net periodic benefit cost $ 16 $ 9 $ — $ 1 The following table indicates the line items in which the respective service costs and non-service benefit costs are presented in the consolidated statement of income (loss) for the six months ended June 30, 2020 and 2019. Pension Plans Postretirement Benefit Plans (for the six months ended June 30, in millions) 2020 2019 2020 2019 Service Cost: Claims and claim adjustment expenses $ 28 $ 24 $ — $ — General and administrative expenses 38 35 — — Total service cost 66 59 — — Non-Service Cost (Benefit): Claims and claim adjustment expenses (14) (16) — 1 General and administrative expenses (20) (24) (1) 1 Total non-service cost (benefit) (34) (40) (1) 2 Net periodic benefit cost (benefit) $ 32 $ 19 $ (1) $ 2 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Additional information regarding real estate operating leases | Lease expense is included in general and administrative expenses in the consolidated statement of income (loss). Additional information regarding the Company’s real estate operating leases is as follows: Three Months Ended Six Months Ended (in millions) 2020 2019 2020 2019 Lease cost Operating leases $ 24 $ 23 $ 48 $ 45 Short-term leases (1) 1 3 1 7 Lease expense 25 26 49 52 Less: sublease income (2) — — — — Net lease cost $ 25 $ 26 $ 49 $ 52 Other information on operating leases Cash payments to settle a lease liability reported in cash flows $ 28 $ 26 $ 55 $ 50 Right-of-use assets obtained in exchange for new lease liabilities $ 4 $ 28 $ 18 $ 36 Weighted average discount rate 2.94 % 3.05 % 2.94 % 3.05 % Weighted average remaining lease term 4.9 years 5.2 years 4.9 years 5.2 years _________________________________________________________ (1) Leases with an initial term of twelve months or less are not recorded on the balance sheet. |
Contractual maturities of lease liabilities | The following table presents the contractual maturities of the Company's lease liabilities: (in millions) Real Estate Lease Liability Remainder of 2020 $ 53 2021 97 2022 74 2023 54 2024 38 Thereafter 57 Total undiscounted lease payments 373 Less: present value adjustment 27 Operating lease liability $ 346 |
Basis of Presentation and Acc_3
Basis of Presentation and Accounting Policies (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Mar. 31, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements | |||||||
Shareholders' equity | $ (26,943) | $ (25,943) | $ (25,321) | ||||
Retained earnings [Member] | |||||||
New Accounting Pronouncements | |||||||
Shareholders' equity | $ (37,069) | $ (37,325) | (36,977) | $ (36,135) | $ (35,795) | $ (35,204) | |
Accounting Standards Update 2016-13 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | Retained earnings [Member] | |||||||
New Accounting Pronouncements | |||||||
Shareholders' equity | $ 43 | $ 43 |
Segment Information (Details)
Segment Information (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | |
Segment reporting information | ||||
Number of reportable business segments | segment | 3 | |||
Premiums | $ 6,955 | $ 6,988 | $ 14,184 | $ 13,843 |
Net investment income | 268 | 648 | 879 | 1,230 |
Fee income | 114 | 116 | 222 | 225 |
Other revenues | 51 | 57 | 109 | 129 |
Net realized investment gains (losses) | 13 | 25 | (85) | 78 |
Total revenues | 7,401 | 7,834 | 15,309 | 15,505 |
Core income (loss) | (50) | 537 | 626 | 1,292 |
Net realized investment gains (losses), net of tax | 10 | 20 | (66) | 61 |
Net income (loss) | (40) | 557 | 560 | 1,353 |
Reportable Segments [Member] | ||||
Segment reporting information | ||||
Premiums | 6,955 | 6,988 | 14,184 | 13,843 |
Net investment income | 268 | 648 | 879 | 1,230 |
Fee income | 114 | 116 | 222 | 225 |
Other revenues | 51 | 57 | 109 | 128 |
Total segment revenues | 7,388 | 7,809 | 15,394 | 15,426 |
Core income (loss) | 24 | 613 | 771 | 1,443 |
Reportable Segments [Member] | Business Insurance [Member] | ||||
Segment reporting information | ||||
Premiums | 3,735 | 3,783 | 7,599 | 7,525 |
Net investment income | 180 | 481 | 633 | 908 |
Fee income | 108 | 111 | 210 | 215 |
Other revenues | 36 | 30 | 67 | 73 |
Total segment revenues | 4,059 | 4,405 | 8,509 | 8,721 |
Core income (loss) | (58) | 351 | 231 | 765 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | ||||
Segment reporting information | ||||
Premiums | 3,482 | 3,520 | 7,072 | 6,995 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | Workers' compensation [Member] | ||||
Segment reporting information | ||||
Premiums | 818 | 950 | 1,717 | 1,922 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | Automobile [Member] | ||||
Segment reporting information | ||||
Premiums | 676 | 647 | 1,360 | 1,275 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | Commercial property [Member] | ||||
Segment reporting information | ||||
Premiums | 514 | 473 | 1,022 | 933 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | General liability [Member] | ||||
Segment reporting information | ||||
Premiums | 580 | 585 | 1,181 | 1,152 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | Commercial multi-peril [Member] | ||||
Segment reporting information | ||||
Premiums | 883 | 856 | 1,769 | 1,696 |
Reportable Segments [Member] | Business Insurance [Member] | Domestic [Member] | Other [Member] | ||||
Segment reporting information | ||||
Premiums | 11 | 9 | 23 | 17 |
Reportable Segments [Member] | Business Insurance [Member] | International [Member] | ||||
Segment reporting information | ||||
Premiums | 253 | 263 | 527 | 530 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | ||||
Segment reporting information | ||||
Premiums | 693 | 632 | 1,360 | 1,238 |
Net investment income | 42 | 58 | 97 | 114 |
Fee income | 0 | 0 | 0 | 0 |
Other revenues | 5 | 6 | 10 | 12 |
Total segment revenues | 740 | 696 | 1,467 | 1,364 |
Core income (loss) | 72 | 174 | 194 | 312 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | Domestic [Member] | ||||
Segment reporting information | ||||
Premiums | 627 | 577 | 1,229 | 1,132 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | Domestic [Member] | General liability [Member] | ||||
Segment reporting information | ||||
Premiums | 296 | 266 | 583 | 523 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | Domestic [Member] | Fidelity and surety [Member] | ||||
Segment reporting information | ||||
Premiums | 271 | 258 | 528 | 504 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | Domestic [Member] | Other [Member] | ||||
Segment reporting information | ||||
Premiums | 60 | 53 | 118 | 105 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | International [Member] | ||||
Segment reporting information | ||||
Premiums | 66 | 55 | 131 | 106 |
Reportable Segments [Member] | Personal Insurance [Member] | ||||
Segment reporting information | ||||
Premiums | 2,527 | 2,573 | 5,225 | 5,080 |
Net investment income | 46 | 109 | 149 | 208 |
Fee income | 6 | 5 | 12 | 10 |
Other revenues | 10 | 21 | 32 | 43 |
Total segment revenues | 2,589 | 2,708 | 5,418 | 5,341 |
Core income (loss) | 10 | 88 | 346 | 366 |
Reportable Segments [Member] | Personal Insurance [Member] | Domestic [Member] | ||||
Segment reporting information | ||||
Premiums | 2,375 | 2,399 | 4,902 | 4,735 |
Reportable Segments [Member] | Personal Insurance [Member] | Domestic [Member] | Automobile [Member] | ||||
Segment reporting information | ||||
Premiums | 1,154 | 1,321 | 2,505 | 2,618 |
Reportable Segments [Member] | Personal Insurance [Member] | Domestic [Member] | Homeowners and Other [Member] | ||||
Segment reporting information | ||||
Premiums | 1,221 | 1,078 | 2,397 | 2,117 |
Reportable Segments [Member] | Personal Insurance [Member] | International [Member] | ||||
Segment reporting information | ||||
Premiums | 152 | 174 | 323 | 345 |
Other [Member] | ||||
Segment reporting information | ||||
Other revenues | 0 | 0 | 0 | 1 |
Core income (loss) | (74) | (76) | (145) | (151) |
After-tax interest expense | $ 67 | $ 70 | $ 133 | $ 140 |
Segment Information (Details) -
Segment Information (Details) - Assets by Segment - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Assets by segment | ||
Total assets | $ 113,337 | $ 110,122 |
Reportable Segments [Member] | ||
Assets by segment | ||
Total assets | 112,718 | 109,510 |
Reportable Segments [Member] | Business Insurance [Member] | ||
Assets by segment | ||
Total assets | 86,136 | 83,896 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | ||
Assets by segment | ||
Total assets | 9,155 | 8,599 |
Reportable Segments [Member] | Personal Insurance [Member] | ||
Assets by segment | ||
Total assets | 17,427 | 17,015 |
Other assets [Member] | ||
Assets by segment | ||
Total assets | $ 619 | $ 612 |
Investments (Details) - Investm
Investments (Details) - Investment Information, Debt Securities - USD ($) $ in Millions | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | |
Investment disclosure details | ||||
Fixed maturities, amortized cost | $ 65,430 | $ 65,281 | ||
Allowance for expected credit losses | 8 | $ 4 | 0 | |
Gross unrealized gains | 4,695 | 2,882 | ||
Gross unrealized losses | 63 | 29 | ||
Fixed maturities, at fair value | 70,054 | 68,134 | ||
Proceeds from sales of fixed maturities classified as available for sale | 1,220 | $ 1,495 | ||
Gross realized gains | 31 | 35 | ||
Gross realized losses | 1 | $ 4 | ||
U.S. Treasury securities and obligations of U.S. government and government agencies and authorities [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 2,046 | 2,076 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 49 | 19 | ||
Gross unrealized losses | 0 | 0 | ||
Fixed maturities, at fair value | 2,095 | 2,095 | ||
Obligations of states, municipalities and political subdivisions [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 29,810 | 28,356 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 2,259 | 1,567 | ||
Gross unrealized losses | 1 | 6 | ||
Fixed maturities, at fair value | 32,068 | 29,917 | ||
Obligations of states, municipalities and political subdivisions, local general obligation [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 16,040 | 15,490 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 1,225 | 829 | ||
Gross unrealized losses | 1 | 4 | ||
Fixed maturities, at fair value | 17,264 | 16,315 | ||
Obligations of states, municipalities and political subdivisions, revenue [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 10,298 | 9,731 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 818 | 586 | ||
Gross unrealized losses | 0 | 2 | ||
Fixed maturities, at fair value | 11,116 | 10,315 | ||
Obligations of states, municipalities and political subdivisions, state general obligation [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 1,144 | 1,167 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 83 | 64 | ||
Gross unrealized losses | 0 | 0 | ||
Fixed maturities, at fair value | 1,227 | 1,231 | ||
Obligations of states, municipalities and political subdivisions, pre-refunded [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 2,328 | 1,968 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 133 | 88 | ||
Gross unrealized losses | 0 | 0 | ||
Fixed maturities, at fair value | 2,461 | 2,056 | ||
Debt securities issued by foreign governments [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 1,023 | 1,167 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 28 | 8 | ||
Gross unrealized losses | 0 | 2 | ||
Fixed maturities, at fair value | 1,051 | 1,173 | ||
Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 2,910 | 3,192 | ||
Allowance for expected credit losses | 0 | 0 | 0 | |
Gross unrealized gains | 174 | 91 | ||
Gross unrealized losses | 0 | 3 | ||
Fixed maturities, at fair value | 3,084 | 3,280 | ||
All other corporate bonds [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 29,619 | 30,442 | ||
Allowance for expected credit losses | 8 | $ 4 | 0 | |
Gross unrealized gains | 2,184 | 1,195 | ||
Gross unrealized losses | 62 | 18 | ||
Fixed maturities, at fair value | 31,733 | 31,619 | ||
Redeemable preferred stock [Member] | ||||
Investment disclosure details | ||||
Fixed maturities, amortized cost | 22 | 48 | ||
Allowance for expected credit losses | 0 | |||
Gross unrealized gains | 1 | 2 | ||
Gross unrealized losses | 0 | 0 | ||
Fixed maturities, at fair value | $ 23 | $ 50 |
Investments (Details) - Inves_2
Investments (Details) - Investment Information, Equity Securities - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Investment disclosure details | |||
Equity securities, cost | $ 378 | $ 376 | |
Gross gains | 36 | 52 | |
Gross losses | 24 | 3 | |
Equity securities, at fair value | 390 | 425 | |
Net recognized gains (losses) on equity securities still held | (33) | $ 45 | |
Public common stock [Member] | |||
Investment disclosure details | |||
Equity securities, cost | 344 | 341 | |
Gross gains | 30 | 45 | |
Gross losses | 23 | 3 | |
Equity securities, at fair value | 351 | 383 | |
Non-redeemable preferred stock [Member] | |||
Investment disclosure details | |||
Equity securities, cost | 34 | 35 | |
Gross gains | 6 | 7 | |
Gross losses | 1 | 0 | |
Equity securities, at fair value | $ 39 | $ 42 |
Investments (Details) - Inves_3
Investments (Details) - Investment Information, Losses - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Investment disclosure details | ||
Continuous unrealized loss position, less than 12 months, fair value | $ 1,496 | $ 2,900 |
Continuous unrealized loss position, less than 12 months, gross unrealized losses | 52 | 19 |
Continuous unrealized loss position, 12 months or longer, fair value | 143 | 1,145 |
Continuous unrealized loss position, 12 months or longer, gross unrealized losses | 11 | 10 |
Continuous unrealized loss position, total, fair value | 1,639 | 4,045 |
Continuous unrealized loss position, total, gross unrealized losses | 63 | 29 |
U.S. Treasury securities and obligations of U.S. government and government agencies and authorities [Member] | ||
Investment disclosure details | ||
Continuous unrealized loss position, less than 12 months, fair value | 46 | 5 |
Continuous unrealized loss position, less than 12 months, gross unrealized losses | 0 | 0 |
Continuous unrealized loss position, 12 months or longer, fair value | 0 | 193 |
Continuous unrealized loss position, 12 months or longer, gross unrealized losses | 0 | 0 |
Continuous unrealized loss position, total, fair value | 46 | 198 |
Continuous unrealized loss position, total, gross unrealized losses | 0 | 0 |
Obligations of states, municipalities and political subdivisions [Member] | ||
Investment disclosure details | ||
Continuous unrealized loss position, less than 12 months, fair value | 334 | 668 |
Continuous unrealized loss position, less than 12 months, gross unrealized losses | 1 | 6 |
Continuous unrealized loss position, 12 months or longer, fair value | 0 | 12 |
Continuous unrealized loss position, 12 months or longer, gross unrealized losses | 0 | 0 |
Continuous unrealized loss position, total, fair value | 334 | 680 |
Continuous unrealized loss position, total, gross unrealized losses | 1 | 6 |
Debt securities issued by foreign governments [Member] | ||
Investment disclosure details | ||
Continuous unrealized loss position, less than 12 months, fair value | 12 | 257 |
Continuous unrealized loss position, less than 12 months, gross unrealized losses | 0 | 1 |
Continuous unrealized loss position, 12 months or longer, fair value | 0 | 147 |
Continuous unrealized loss position, 12 months or longer, gross unrealized losses | 0 | 1 |
Continuous unrealized loss position, total, fair value | 12 | 404 |
Continuous unrealized loss position, total, gross unrealized losses | 0 | 2 |
Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||
Investment disclosure details | ||
Continuous unrealized loss position, less than 12 months, fair value | 25 | 399 |
Continuous unrealized loss position, less than 12 months, gross unrealized losses | 0 | 2 |
Continuous unrealized loss position, 12 months or longer, fair value | 2 | 131 |
Continuous unrealized loss position, 12 months or longer, gross unrealized losses | 0 | 1 |
Continuous unrealized loss position, total, fair value | 27 | 530 |
Continuous unrealized loss position, total, gross unrealized losses | 0 | 3 |
All other corporate bonds [Member] | ||
Investment disclosure details | ||
Continuous unrealized loss position, less than 12 months, fair value | 1,079 | 1,571 |
Continuous unrealized loss position, less than 12 months, gross unrealized losses | 51 | 10 |
Continuous unrealized loss position, 12 months or longer, fair value | 141 | 662 |
Continuous unrealized loss position, 12 months or longer, gross unrealized losses | 11 | 8 |
Continuous unrealized loss position, total, fair value | 1,220 | 2,233 |
Continuous unrealized loss position, total, gross unrealized losses | $ 62 | $ 18 |
Investments (Details) - Credit
Investments (Details) - Credit Loss Allowance - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Allowance for expected credit losses [Roll Forward] | ||||
Allowance for expected credit losses on fixed maturities classified as available-for-sale, balance, beginning of period | $ 4 | $ 0 | ||
Additions for expected credit losses on securities where no credit losses were previously recognized | 4 | 8 | ||
Additions (reductions) for expected credit losses on securities where credit losses were previously recognized | 0 | 0 | ||
Reductions due to sales/defaults of credit-impaired securities | 0 | 0 | ||
Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell | 0 | 0 | ||
Allowance for expected credit losses on fixed maturities classified as available-for-sale, balance, end of period | 8 | 8 | ||
Credit impairment charges recognized in net realized investment gains (losses) on securities which the Company intends to sell and for which an allowance for credit loss was not previously recorded | 2 | 14 | ||
Total credit impairment charges included in net realized investment gains (losses) in the consolidated statement of income (loss) | 46 | $ 1 | 62 | $ 2 |
Total credit impairment charges included in net realized investment gains (losses) in the consolidated statement of income (loss) related to other investments | $ 40 | $ 40 | ||
Credit losses on fixed maturities recognized in the consolidated statement of income, as a percentage of the fixed maturity portfolio on a pre-tax basis (less than) | 1.00% | 1.00% | 1.00% | 1.00% |
Credit losses on fixed maturities recognized in the consolidated statement of income, as a percentage of shareholders' equity on an after-tax basis (less than) | 1.00% | 1.00% | 1.00% | 1.00% |
Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||||
Allowance for expected credit losses [Roll Forward] | ||||
Allowance for expected credit losses on fixed maturities classified as available-for-sale, balance, beginning of period | $ 0 | $ 0 | ||
Additions for expected credit losses on securities where no credit losses were previously recognized | 0 | 0 | ||
Additions (reductions) for expected credit losses on securities where credit losses were previously recognized | 0 | 0 | ||
Reductions due to sales/defaults of credit-impaired securities | 0 | 0 | ||
Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell | 0 | 0 | ||
Allowance for expected credit losses on fixed maturities classified as available-for-sale, balance, end of period | 0 | 0 | ||
All other corporate bonds [Member] | ||||
Allowance for expected credit losses [Roll Forward] | ||||
Allowance for expected credit losses on fixed maturities classified as available-for-sale, balance, beginning of period | 4 | 0 | ||
Additions for expected credit losses on securities where no credit losses were previously recognized | 4 | 8 | ||
Additions (reductions) for expected credit losses on securities where credit losses were previously recognized | 0 | 0 | ||
Reductions due to sales/defaults of credit-impaired securities | 0 | 0 | ||
Reductions for impairments of securities which the Company intends to sell or more likely than not will be required to sell | 0 | 0 | ||
Allowance for expected credit losses on fixed maturities classified as available-for-sale, balance, end of period | $ 8 | $ 8 |
Investments (Details) - Other I
Investments (Details) - Other Investments | 6 Months Ended |
Jun. 30, 2020 | |
Investments [Abstract] | |
Availability of financial information provided by hedge funds following the date of the reporting | 1 month |
Availability of financial information provided by private equity and real estate partnerships following the date of the reporting, maximum | 3 months |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value Disclosures [Abstract] | ||
Percent of fixed maturities for which a pricing service estimates fair value | 99.00% | 99.00% |
Fair value of the fixed maturities for which the Company used an internal pricing matrix | $ 89 | $ 73 |
Fair value of the fixed maturities for which the Company received a broker quote | 3 | 28 |
Estimated fair value of put/call option | $ 7 | $ 8 |
Fair Value Measurements (Deta_2
Fair Value Measurements (Details) - Fair Value Hierarchy - Recurring basis [Member] - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | $ 70,476 | $ 68,595 |
Other liabilities measured on a recurring basis | 7 | 8 |
Fixed maturities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 70,054 | 68,134 |
U.S. Treasury securities and obligations of U.S. government and government agencies and authorities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 2,095 | 2,095 |
Obligations of states, municipalities and political subdivisions [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 32,068 | 29,917 |
Debt securities issued by foreign governments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 1,051 | 1,173 |
Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 3,084 | 3,280 |
All other corporate bonds [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 31,733 | 31,619 |
Redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 23 | 50 |
Equity securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 390 | 425 |
Public common stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 351 | 383 |
Non-redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 39 | 42 |
Other Investments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 32 | 36 |
Level 1 [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 2,472 | 2,507 |
Other liabilities measured on a recurring basis | 0 | 0 |
Level 1 [Member] | Fixed maturities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 2,097 | 2,095 |
Level 1 [Member] | U.S. Treasury securities and obligations of U.S. government and government agencies and authorities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 2,095 | 2,095 |
Level 1 [Member] | Obligations of states, municipalities and political subdivisions [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 1 [Member] | Debt securities issued by foreign governments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 1 [Member] | Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 1 [Member] | All other corporate bonds [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 2 | 0 |
Level 1 [Member] | Redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 1 [Member] | Equity securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 361 | 396 |
Level 1 [Member] | Public common stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 351 | 383 |
Level 1 [Member] | Non-redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 10 | 13 |
Level 1 [Member] | Other Investments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 14 | 16 |
Level 2 [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 67,894 | 65,967 |
Other liabilities measured on a recurring basis | 0 | 0 |
Level 2 [Member] | Fixed maturities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 67,865 | 65,938 |
Level 2 [Member] | U.S. Treasury securities and obligations of U.S. government and government agencies and authorities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 2 [Member] | Obligations of states, municipalities and political subdivisions [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 32,056 | 29,905 |
Level 2 [Member] | Debt securities issued by foreign governments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 1,051 | 1,173 |
Level 2 [Member] | Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 3,084 | 3,280 |
Level 2 [Member] | All other corporate bonds [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 31,651 | 31,530 |
Level 2 [Member] | Redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 23 | 50 |
Level 2 [Member] | Equity securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 29 | 29 |
Level 2 [Member] | Public common stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 2 [Member] | Non-redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 29 | 29 |
Level 2 [Member] | Other Investments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 110 | 121 |
Other liabilities measured on a recurring basis | 7 | 8 |
Level 3 [Member] | Fixed maturities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 92 | 101 |
Level 3 [Member] | U.S. Treasury securities and obligations of U.S. government and government agencies and authorities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | Obligations of states, municipalities and political subdivisions [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 12 | 12 |
Level 3 [Member] | Debt securities issued by foreign governments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | Mortgage-backed securities, collateralized mortgage obligations and pass-through securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | All other corporate bonds [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 80 | 89 |
Level 3 [Member] | Redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | Equity securities [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | Public common stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | Non-redeemable preferred stock [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | 0 | 0 |
Level 3 [Member] | Other Investments [Member] | ||
Level within the fair value hierarchy at which the Company's financial assets and financial liabilities are measured | ||
Total invested assets measured on a recurring basis | $ 18 | $ 20 |
Fair Value Measurements (Deta_3
Fair Value Measurements (Details) - Financial Instruments - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Financial Instruments | ||
Short-term securities | $ 6,087 | $ 4,943 |
Carrying Value [Member] | ||
Financial Instruments | ||
Short-term securities | 6,087 | 4,943 |
Debt | 6,949 | 6,458 |
Commercial paper | 100 | 100 |
Fair Value [Member] | ||
Financial Instruments | ||
Short-term securities | 6,087 | 4,943 |
Debt | 9,059 | 8,049 |
Commercial paper | 100 | 100 |
Fair Value [Member] | Level 1 [Member] | ||
Financial Instruments | ||
Short-term securities | 2,139 | 685 |
Debt | 0 | 0 |
Commercial paper | 0 | 0 |
Fair Value [Member] | Level 2 [Member] | ||
Financial Instruments | ||
Short-term securities | 3,898 | 4,204 |
Debt | 9,059 | 8,049 |
Commercial paper | 100 | 100 |
Fair Value [Member] | Level 3 [Member] | ||
Financial Instruments | ||
Short-term securities | 50 | 54 |
Debt | 0 | 0 |
Commercial paper | $ 0 | $ 0 |
Allowance for Expected Credit_3
Allowance for Expected Credit Losses (Details) - Changes in the Allowance for Expected Credit Losses on Premiums Receivable - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Credit Loss [Abstract] | ||
Premiums receivable (net of allowance for expected credit losses), balance, beginning of period | $ 8,202 | $ 7,909 |
Premiums receivable (net of allowance for expected credit losses), balance, end of period | 8,459 | 8,459 |
Premiums receivable, allowance for expected credit losses [Roll Forward] | ||
Premiums receivable, allowance for expected credit losses, beginning balance | 78 | 49 |
Current period change for expected credit losses | 24 | 67 |
Write-offs of uncollectible premiums receivable | 8 | 22 |
Premiums receivable, allowance for expected credit losses, ending balance | $ 94 | $ 94 |
Allowance for Expected Credit_4
Allowance for Expected Credit Losses (Details) - Changes in the Allowance for Estimated Uncollectible Reinsurance - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Reinsurance recoverables, allowance for uncollectible reinsurance | ||
Reinsurance recoverables (net of allowance for estimated uncollectible reinsurance), balance, beginning of period | $ 8,152 | $ 8,235 |
Reinsurance recoverables (net of allowance for estimated uncollectible reinsurance), balance, end of period | 8,093 | 8,093 |
Reinsurance recoverables, allowance for uncollectible reinsurance [Roll Forward] | ||
Reinsurance recoverables, allowance for uncollectible reinsurance, beginning balance | 149 | 92 |
Reinsurance recoverables, allowance for estimated uncollectible reinsurance | 149 | 92 |
Current period change for estimated uncollectible reinsurance | 7 | 11 |
Write-offs of uncollectible reinsurance recoverables | 0 | 0 |
Reinsurance recoverables, allowance for uncollectible reinsurance, ending balance | $ 156 | 156 |
Accounting Standards Update 2016-13 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||
Reinsurance recoverables, allowance for uncollectible reinsurance [Roll Forward] | ||
Reinsurance recoverables, allowance for uncollectible reinsurance, beginning balance | 53 | |
Reinsurance recoverables, allowance for estimated uncollectible reinsurance | $ 53 |
Allowance for Expected Credit_5
Allowance for Expected Credit Losses (Details) - Narrative - Reinsurer Concentration Risk [Member] $ in Millions | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Reinsurance Recoverables [Member] | Reinsurer Group Rated by A.M. Best [Member] | A.M. Best, Rating Provided [Member] | |
Reinsurance recoverables, credit quality indicator | |
Reinsurance recoverables, after deducting mandatory pools and associations and before allowances for expected credit losses | $ 5,540 |
Concentration risk percentage | 87.00% |
Reinsurance Recoverables [Member] | Reinsurer Group Not Rated by A.M. Best [Member] | |
Reinsurance recoverables, credit quality indicator | |
Concentration risk percentage | 13.00% |
Reinsurance Recoverables [Member] | Captive Insurance Companies [Member] | |
Reinsurance recoverables, credit quality indicator | |
Concentration risk percentage | 6.00% |
Reinsurance Recoverables [Member] | Voluntary Pools [Member] | |
Reinsurance recoverables, credit quality indicator | |
Concentration risk percentage | 2.00% |
Reinsurance Recoverables [Member] | Other Companies [Member] | |
Reinsurance recoverables, credit quality indicator | |
Concentration risk percentage | 5.00% |
Reinsurance Recoverables Rated by A.M. Best [Member] | Reinsurer Group Rated by A.M. Best [Member] | A.M. Best, A- Rating Or Better [Member] | |
Reinsurance recoverables, credit quality indicator | |
Concentration risk percentage | 93.00% |
Allowance for Expected Credit_6
Allowance for Expected Credit Losses (Details) - Changes in the Allowance for Expected Credit Losses on Contractholder Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Credit Loss [Abstract] | ||
Contractholder receivables (net of the allowance for expected credit losses), balance, beginning of period | $ 4,634 | $ 4,599 |
Contractholder receivables (net of the allowance for expected credit losses), balance, end of period | 4,314 | 4,314 |
Contractholder receivables, allowance for expected credit losses [Roll Forward] | ||
Contractholder receivables, allowance for expected credit losses, beginning balance | 20 | 20 |
Current period change for expected credit losses | 2 | 2 |
Write-offs of uncollectible contractholder receivables | 0 | 0 |
Contractholder receivables, allowance for expected credit losses, ending balance | $ 22 | $ 22 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Goodwill by segment | ||
Goodwill | $ 3,925 | $ 3,961 |
Reportable Segments [Member] | Business Insurance [Member] | ||
Goodwill by segment | ||
Goodwill | 2,573 | 2,601 |
Reportable Segments [Member] | Bond & Specialty Insurance [Member] | ||
Goodwill by segment | ||
Goodwill | 550 | 550 |
Reportable Segments [Member] | Personal Insurance [Member] | ||
Goodwill by segment | ||
Goodwill | 776 | 784 |
Other [Member] | ||
Goodwill by segment | ||
Goodwill | $ 26 | $ 26 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Details) - Other Intangible Assets - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Other intangible assets by major asset class | |||||
Intangible assets subject to amortization, gross carrying amount | $ 299 | $ 299 | $ 304 | ||
Intangible assets subject to amortization, accumulated amortization | 206 | 206 | 200 | ||
Intangible assets subject to amortization, net | 93 | 93 | 104 | ||
Intangible assets not subject to amortization | 226 | 226 | 226 | ||
Total other intangible assets, gross carrying amount | 525 | 525 | 530 | ||
Total other intangible assets, net | 319 | 319 | 330 | ||
Amortization expense of intangible assets | 3 | $ 4 | 7 | $ 8 | |
Estimated intangible asset amortization expense, remainder of 2020 | 7 | 7 | |||
Estimated intangible asset amortization expense, 2021 | 13 | 13 | |||
Estimated intangible asset amortization expense, 2022 | 12 | 12 | |||
Estimated intangible asset amortization expense, 2023 | 12 | 12 | |||
Estimated intangible asset amortization expense, 2024 | 11 | 11 | |||
Customer-related [Member] | |||||
Other intangible assets by major asset class | |||||
Intangible assets subject to amortization, gross carrying amount | 95 | 95 | 99 | ||
Intangible assets subject to amortization, accumulated amortization | 25 | 25 | 21 | ||
Intangible assets subject to amortization, net | 70 | 70 | 78 | ||
Contract-based [Member] | |||||
Other intangible assets by major asset class | |||||
Intangible assets subject to amortization, gross carrying amount | 204 | 204 | 205 | ||
Intangible assets subject to amortization, accumulated amortization | 181 | 181 | 179 | ||
Intangible assets subject to amortization, net | 23 | 23 | $ 26 | ||
Insurance Contracts Acquired in Business Combination [Member] | |||||
Other intangible assets by major asset class | |||||
Estimated intangible asset amortization expense, remainder of 2020 | 2 | 2 | |||
Estimated intangible asset amortization expense, 2021 | 4 | 4 | |||
Estimated intangible asset amortization expense, 2022 | 3 | 3 | |||
Estimated intangible asset amortization expense, 2023 | 3 | 3 | |||
Estimated intangible asset amortization expense, 2024 | $ 2 | $ 2 |
Insurance Claim Reserves (Detai
Insurance Claim Reserves (Details) - Reserve Detail for Claims and Claim Adjustment Expenses - USD ($) $ in Millions | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of beginning and ending reserve balances for claims and claim adjustment expenses [Roll Forward] | ||||
Claims and claim adjustment expense reserves at beginning of year | $ 51,849 | |||
Reinsurance recoverables, allowance for estimated uncollectible reinsurance | 156 | $ 149 | $ 92 | |
Claims and claim adjustment expense reserves at end of period | 53,109 | |||
Accounting Standards Update 2016-13 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
Reconciliation of beginning and ending reserve balances for claims and claim adjustment expenses [Roll Forward] | ||||
Reinsurance recoverables, allowance for estimated uncollectible reinsurance | 53 | |||
Property-casualty [Member] | ||||
Reconciliation of beginning and ending reserve balances for claims and claim adjustment expenses [Roll Forward] | ||||
Claims and claim adjustment expense reserves at beginning of year | 51,836 | $ 50,653 | ||
Reinsurance recoverables on unpaid losses | 8,035 | 8,182 | ||
Net reserves at beginning of year | 43,854 | 42,471 | ||
Estimated claims and claim adjustment expenses for claims arising in the current year | 9,826 | 9,329 | ||
Estimated increase (decrease) in claims and claim adjustment expenses for claims arising in prior years | 16 | (118) | ||
Total increases | 9,842 | 9,211 | ||
Claims and claim adjustment expense payments for claims arising in current year | 2,664 | 2,810 | ||
Claims and claim adjustment expense payments for claims arising in prior years | 5,674 | 5,897 | ||
Total payments | 8,338 | 8,707 | ||
Unrealized foreign exchange (gain) loss | (137) | 62 | ||
Net reserves at end of period | 45,221 | 43,037 | ||
Reinsurance recoverables on unpaid losses | 7,876 | 8,022 | ||
Claims and claim adjustment expense reserves at end of period | 53,097 | $ 51,059 | ||
Amount of increase in gross claims and claim adjustment expense reserves | 1,260 | |||
Amount of decrease in reinsurance recoverables on unpaid losses | 159 | |||
Property-casualty [Member] | Accounting Standards Update 2016-13 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
Reconciliation of beginning and ending reserve balances for claims and claim adjustment expenses [Roll Forward] | ||||
Reinsurance recoverables, allowance for estimated uncollectible reinsurance | $ 53 | |||
Accident and health [Member] | ||||
Reconciliation of beginning and ending reserve balances for claims and claim adjustment expenses [Roll Forward] | ||||
Claims and claim adjustment expense reserves at beginning of year | 13 | |||
Claims and claim adjustment expense reserves at end of period | $ 12 |
Insurance Claim Reserves (Det_2
Insurance Claim Reserves (Details) - Subsequent Event $ in Millions | 3 Months Ended |
Sep. 30, 2020USD ($) | |
Subsequent Event [Member] | Forecast [Member] | |
Subsequent event | |
Subrogation benefit to be recognized in earnings | $ 400 |
Insurance Claim Reserves (Det_3
Insurance Claim Reserves (Details) - Prior Year Reserve Development - Property-casualty [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Liability for claims and claim adjustment expense | ||||
Net favorable (unfavorable) prior year reserve development included in estimated claims and claim adjustment expenses incurred for claims arising in prior years | $ (16) | $ 118 | ||
Net favorable (unfavorable) prior year reserve development impacting the Company's results of operations | 29 | 174 | ||
Accretion expense | 24 | 25 | ||
Business Insurance [Member] | ||||
Liability for claims and claim adjustment expense | ||||
Net favorable (unfavorable) prior year reserve development impacting the Company's results of operations | $ 0 | $ 71 | 5 | 50 |
Business Insurance [Member] | Environmental reserves [Member] | ||||
Liability for claims and claim adjustment expense | ||||
Increase to environmental reserves | 60 | 60 | ||
Bond & Specialty Insurance [Member] | ||||
Liability for claims and claim adjustment expense | ||||
Net favorable (unfavorable) prior year reserve development impacting the Company's results of operations | (33) | 39 | (33) | 42 |
Personal Insurance [Member] | ||||
Liability for claims and claim adjustment expense | ||||
Net favorable (unfavorable) prior year reserve development impacting the Company's results of operations | $ 35 | $ 13 | $ 57 | $ 82 |
Other Comprehensive Income an_3
Other Comprehensive Income and Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Accumulated other comprehensive income [Roll Forward] | ||||
Balance, beginning of year | $ 25,943 | |||
Other comprehensive income, net of taxes | $ 1,931 | $ 888 | 1,242 | $ 2,065 |
Balance, end of period | 26,943 | 25,321 | 26,943 | 25,321 |
Pre-tax components of other comprehensive income (loss) and related tax expense (benefit) | ||||
Other comprehensive income before income taxes | 2,435 | 1,123 | 1,609 | 2,606 |
Income tax expense (benefit) | 504 | 235 | 367 | 541 |
Other comprehensive income, net of taxes | 1,931 | 888 | 1,242 | 2,065 |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Accumulated other comprehensive income [Roll Forward] | ||||
Balance, beginning of year | (49) | (682) | 640 | (1,859) |
Other comprehensive income (loss) before reclassifications | 1,922 | 1,214 | ||
Amounts reclassified from accumulated other comprehensive income | 9 | 28 | ||
Other comprehensive income, net of taxes | 1,931 | 888 | 1,242 | 2,065 |
Balance, end of period | 1,882 | 206 | 1,882 | 206 |
Pre-tax components of other comprehensive income (loss) and related tax expense (benefit) | ||||
Other comprehensive income before income taxes | 2,435 | 1,123 | 1,609 | 2,606 |
Income tax expense (benefit) | 504 | 235 | 367 | 541 |
Other comprehensive income, net of taxes | 1,931 | 888 | 1,242 | 2,065 |
Changes in Net Unrealized Gains on Investment Securities Having No Credit Losses Recognized in the Consolidated Statement of Income [Member] | ||||
Accumulated other comprehensive income [Roll Forward] | ||||
Balance, beginning of year | 1,600 | 2,057 | ||
Other comprehensive income (loss) before reclassifications | 1,867 | 1,408 | ||
Amounts reclassified from accumulated other comprehensive income | (8) | (6) | ||
Other comprehensive income, net of taxes | 1,859 | 874 | 1,402 | 1,990 |
Balance, end of period | 3,459 | 3,459 | ||
Pre-tax components of other comprehensive income (loss) and related tax expense (benefit) | ||||
Other comprehensive income before income taxes | 2,359 | 1,108 | 1,784 | 2,524 |
Income tax expense (benefit) | 500 | 234 | 382 | 534 |
Other comprehensive income, net of taxes | 1,859 | 874 | 1,402 | 1,990 |
Changes in Net Unrealized Gains on Investment Securities Having Credit Losses Recognized in the Consolidated Statement of Income [Member] | ||||
Accumulated other comprehensive income [Roll Forward] | ||||
Balance, beginning of year | 185 | 189 | ||
Other comprehensive income (loss) before reclassifications | 2 | (2) | ||
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | ||
Other comprehensive income, net of taxes | 2 | (3) | (2) | 1 |
Balance, end of period | 187 | 187 | ||
Pre-tax components of other comprehensive income (loss) and related tax expense (benefit) | ||||
Other comprehensive income before income taxes | 3 | (4) | (3) | 1 |
Income tax expense (benefit) | 1 | (1) | (1) | 0 |
Other comprehensive income, net of taxes | 2 | (3) | (2) | 1 |
Net Benefit Plan Assets and Obligations Recognized in Shareholders' Equity [Member] | ||||
Accumulated other comprehensive income [Roll Forward] | ||||
Balance, beginning of year | (828) | (846) | ||
Other comprehensive income (loss) before reclassifications | 0 | 1 | ||
Amounts reclassified from accumulated other comprehensive income | 17 | 34 | ||
Other comprehensive income, net of taxes | 17 | 11 | 35 | 21 |
Balance, end of period | (811) | (811) | ||
Pre-tax components of other comprehensive income (loss) and related tax expense (benefit) | ||||
Other comprehensive income before income taxes | 21 | 14 | 44 | 26 |
Income tax expense (benefit) | 4 | 3 | 9 | 5 |
Other comprehensive income, net of taxes | 17 | 11 | 35 | 21 |
Net Unrealized Foreign Currency Translation [Member] | ||||
Accumulated other comprehensive income [Roll Forward] | ||||
Balance, beginning of year | (1,006) | (760) | ||
Other comprehensive income (loss) before reclassifications | 53 | (193) | ||
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | ||
Other comprehensive income, net of taxes | 53 | 6 | (193) | 53 |
Balance, end of period | (953) | (953) | ||
Pre-tax components of other comprehensive income (loss) and related tax expense (benefit) | ||||
Other comprehensive income before income taxes | 52 | 5 | (216) | 55 |
Income tax expense (benefit) | (1) | (1) | (23) | 2 |
Other comprehensive income, net of taxes | $ 53 | $ 6 | $ (193) | $ 53 |
Other Comprehensive Income an_4
Other Comprehensive Income and Accumulated Other Comprehensive Income (Details) - Reclassifications - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income | ||||
Reclassification adjustment impacting net realized investment gains on the income statement | $ (13) | $ (25) | $ 85 | $ (78) |
Reclassification adjustment impacting claims and claim adjustment expenses on the income statement | 5,107 | 4,821 | 9,896 | 9,263 |
Reclassification adjustment impacting general and administrative expense on the income statement | 1,121 | 1,125 | 2,258 | 2,182 |
Total reclassifications | 85 | (665) | (635) | (1,632) |
Income tax (expense) benefit | 45 | (108) | (75) | (279) |
Amounts reclassified from accumulated other comprehensive income, net of taxes | 40 | (557) | (560) | (1,353) |
Accumulated Other Comprehensive Income (Loss) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income | ||||
Total reclassifications | 12 | 0 | 35 | (3) |
Income tax (expense) benefit | 3 | (1) | 7 | (1) |
Amounts reclassified from accumulated other comprehensive income, net of taxes | 9 | 1 | 28 | (2) |
Changes in Net Unrealized Gains on Investment Securities Having No Credit Losses Recognized in the Consolidated Statement of Income [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income | ||||
Reclassification adjustment impacting net realized investment gains on the income statement | (10) | (13) | (8) | (29) |
Income tax (expense) benefit | (2) | (3) | (2) | (6) |
Amounts reclassified from accumulated other comprehensive income, net of taxes | (8) | (10) | (6) | (23) |
Changes in Net Unrealized Gains on Investment Securities Having Credit Losses Recognized in the Consolidated Statement of Income [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income | ||||
Reclassification adjustment impacting net realized investment gains on the income statement | 0 | 0 | 0 | 0 |
Income tax (expense) benefit | 0 | 0 | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income, net of taxes | 0 | 0 | 0 | 0 |
Net Benefit Plan Assets and Obligations Recognized in Shareholders' Equity [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income | ||||
Reclassification adjustment impacting claims and claim adjustment expenses on the income statement | 9 | 6 | 18 | 11 |
Reclassification adjustment impacting general and administrative expense on the income statement | 13 | 7 | 25 | 15 |
Total reclassifications | 22 | 13 | 43 | 26 |
Income tax (expense) benefit | 5 | 2 | 9 | 5 |
Amounts reclassified from accumulated other comprehensive income, net of taxes | 17 | 11 | 34 | 21 |
Net Unrealized Foreign Currency Translation [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income | ||||
Reclassification adjustment impacting net realized investment gains on the income statement | 0 | 0 | 0 | 0 |
Income tax (expense) benefit | 0 | 0 | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income, net of taxes | $ 0 | $ 0 | $ 0 | $ 0 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | Apr. 27, 2020 | Jun. 30, 2020 | Jun. 30, 2019 |
Debt Instrument | |||
Net proceeds of issuance, after the deduction of the underwriting discount and expenses | $ 490 | $ 492 | |
Senior Notes [Member] | 2.55% Senior Notes due April 27, 2050 [Member] | |||
Debt Instrument | |||
Debt, principal amount | $ 500 | ||
Interest rate (percent) | 2.55% | ||
Net proceeds of issuance, after the deduction of the underwriting discount and expenses | $ 490 | ||
Percentage of principal amount at which redemption price may be set | 100.00% | ||
Basis points added to current Treasury rate used in calculation of alternative redemption price | 0.25% |
Common Share Repurchases (Detai
Common Share Repurchases (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020USD ($)shares | Jun. 30, 2020USD ($)$ / sharesshares | |
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | ||
Number of shares repurchased (in shares) | shares | 3,500,000 | |
Cost of shares repurchased | $ 425,000 | |
Average cost per share repurchased (in dollars per share) | $ / shares | $ 123.09 | |
Number of shares acquired to cover tax withholding costs and exercise costs (in shares) | shares | 368 | 300,000 |
Cost of shares acquired to cover tax withholding costs and exercise costs | $ 33 | $ 46,000 |
Remaining capacity under share repurchase authorization | $ 1,360,000 | $ 1,360,000 |
Earnings (Loss) per Share (Deta
Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share Reconciliation [Abstract] | ||||
Net income (loss) | $ (40) | $ 557 | $ 560 | $ 1,353 |
Participating share-based awards — allocated income | (1) | (4) | (3) | (10) |
Net income (loss) available to common shareholders -- basic | (41) | 553 | 557 | 1,343 |
Net income (loss) available to common shareholders -- diluted | $ (41) | $ 553 | $ 557 | $ 1,343 |
Weighted average shares outstanding, basic (in shares) | 251.6 | 261.3 | 253.6 | 262.1 |
Weighted average effects of dilutive securities - stock options and performance shares (in shares) | 0 | 2.4 | 1.1 | 2.1 |
Weighted average shares outstanding, diluted (in shares) | 251.6 | 263.7 | 254.7 | 264.2 |
Net income (loss) per common share, basic (in dollars per share) | $ (0.16) | $ 2.11 | $ 2.19 | $ 5.12 |
Net income (loss) per common share, diluted (in dollars per share) | $ (0.16) | $ 2.10 | $ 2.19 | $ 5.08 |
Excluded allocation of undistributed loss to participating share-based awards because such allocation would result in anti-dilution of basic and diluted earnings per share | $ 2 | |||
Amount of shares excluded from computation of net loss per diluted common share since their effects on income was anti-dilutive | 0.7 |
Share-Based Incentive Compens_3
Share-Based Incentive Compensation (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Stock options vested at end of period, number (in shares) | 7,488,449 | 7,488,449 | ||
Stock options vested at end of period, weighted average exercise price (in dollars per share) | $ 114.26 | $ 114.26 | ||
Stock options vested at end of period, weighted average contractual life remaining (in years) | 5 years 9 months 18 days | |||
Stock options vested at end of period, aggregate intrinsic value | $ 56 | $ 56 | ||
Stock options exercisable at end of period, number (in shares) | 5,167,407 | 5,167,407 | ||
Stock options exercisable at end of period, weighted average exercise price (in dollars per share) | $ 106.08 | $ 106.08 | ||
Stock options exercisable at end of period, weighted average contractual life remaining (in years) | 4 years 6 months | |||
Stock options exercisable at end of period, aggregate intrinsic value | $ 56 | $ 56 | ||
Total compensation cost recognized in earnings for all share-based incentive compensation awards | 34 | $ 35 | 80 | $ 80 |
Tax benefit recognized in earnings related to compensation costs | 6 | $ 6 | 14 | $ 14 |
Total unrecognized compensation cost related to all nonvested share-based incentive compensation awards | $ 198 | $ 198 | ||
Weighted-average period of recognition for unrecognized compensation cost (in years) | 2 years |
Pension Plans, Retirement Ben_3
Pension Plans, Retirement Benefits and Savings Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Pension Plans [Member] | ||||
Defined benefit plan disclosure | ||||
Service cost | $ 33 | $ 29 | $ 66 | $ 59 |
Interest cost on benefit obligation | 28 | 35 | 57 | 70 |
Expected return on plan assets | (68) | (68) | (137) | (137) |
Net periodic benefit cost, amortization of unrecognized prior service benefit | 0 | (1) | 0 | (1) |
Net periodic benefit cost, amortization of unrecognized net actuarial (gain) loss | 23 | 14 | 46 | 28 |
Total non-service cost (benefit) | (17) | (20) | (34) | (40) |
Net periodic benefit cost (benefit) | 16 | 9 | 32 | 19 |
Pension Plans [Member] | Claims and claim adjustment expenses [Member] | ||||
Defined benefit plan disclosure | ||||
Service cost | 14 | 12 | 28 | 24 |
Total non-service cost (benefit) | (7) | (8) | (14) | (16) |
Pension Plans [Member] | General and administrative expenses [Member] | ||||
Defined benefit plan disclosure | ||||
Service cost | 19 | 17 | 38 | 35 |
Total non-service cost (benefit) | (10) | (12) | (20) | (24) |
Postretirement Benefit Plans [Member] | ||||
Defined benefit plan disclosure | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost on benefit obligation | 1 | 2 | 2 | 4 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Net periodic benefit cost, amortization of unrecognized prior service benefit | 0 | (1) | (2) | (2) |
Net periodic benefit cost, amortization of unrecognized net actuarial (gain) loss | (1) | 0 | (1) | 0 |
Total non-service cost (benefit) | 0 | 1 | (1) | 2 |
Net periodic benefit cost (benefit) | 0 | 1 | (1) | 2 |
Postretirement Benefit Plans [Member] | Claims and claim adjustment expenses [Member] | ||||
Defined benefit plan disclosure | ||||
Service cost | 0 | 0 | 0 | 0 |
Total non-service cost (benefit) | 0 | 1 | 0 | 1 |
Postretirement Benefit Plans [Member] | General and administrative expenses [Member] | ||||
Defined benefit plan disclosure | ||||
Service cost | 0 | 0 | 0 | 0 |
Total non-service cost (benefit) | $ 0 | $ 0 | $ (1) | $ 1 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Leases [Abstract] | ||||
Operating leases | $ 24 | $ 23 | $ 48 | $ 45 |
Short-term leases | 1 | 3 | 1 | 7 |
Lease expense | 25 | 26 | 49 | 52 |
Less: sublease income | 0 | 0 | 0 | 0 |
Net lease cost | 25 | 26 | 49 | 52 |
Cash payments to settle a lease liability reported in cash flows | 28 | 26 | 55 | 50 |
Right-of-use assets obtained in exchange for new lease liabilities | $ 4 | $ 28 | $ 18 | $ 36 |
Weighted average discount rate (percent) | 2.94% | 3.05% | 2.94% | 3.05% |
Weighted average remaining lease term (in years) | 4 years 10 months 24 days | 5 years 2 months 12 days | 4 years 10 months 24 days | 5 years 2 months 12 days |
Leases (Details) - Contractual
Leases (Details) - Contractual Maturities of Lease Liabilities $ in Millions | Jun. 30, 2020USD ($) |
Leases [Abstract] | |
Lease payments due, remainder of 2020 | $ 53 |
Lease payments due, 2021 | 97 |
Lease payments due, 2022 | 74 |
Lease payments due, 2023 | 54 |
Lease payments due, 2024 | 38 |
Lease payments due, thereafter | 57 |
Total undiscounted lease payments | 373 |
Less: present value adjustment | 27 |
Operating lease liability | $ 346 |
Contingencies, Commitments an_2
Contingencies, Commitments and Guarantees (Details) - Commitments - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Contingencies, Commitments and Guarantees [Abstract] | ||
Unfunded commitments to private equity limited partnerships and real estate partnerships | $ 1,630 | $ 1,660 |
Contingencies, Commitments an_3
Contingencies, Commitments and Guarantees (Details) - Guarantees $ in Millions | Jun. 30, 2020USD ($) |
Indemnifications related to the sale of businesses [Member] | |
Guarantor obligations | |
Maximum amount of contingent obligation | $ 351 |
Guarantees of certain insurance policy obligations [Member] | |
Guarantor obligations | |
Maximum amount of contingent obligation | 480 |
Amount indemnified by a third party | $ 480 |