Fair Value (Notes)

9 Months Ended

Sep. 30, 2021

Fair Value

Certain assets and liabilities are measured at fair value in the Condensed Consolidated Financial Statements or have fair values disclosed in the Notes to the Condensed Consolidated Financial Statements. These assets and liabilities are classified into one of three levels of a hierarchy defined by GAAP.

For a description of the methods and assumptions that are used to estimate the fair value and determine the fair value hierarchy classification of each class of financial instrument, see Note 4 of Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements” in the 2020 10-K.

The following table presents a summary of fair value measurements by level and carrying values for items measured at fair value on a recurring basis in the Condensed Consolidated Balance Sheets:


(in millions)	Quoted Prices in Active Markets (Level 1)			Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)			Total Fair and Carrying Value
September 30, 2021
Cash and cash equivalents	$	20,944		$	141		$	—		$	21,085
Debt securities - available-for-sale:
U.S. government and agency obligations	3,446			226			—			3,672
State and municipal obligations	—			7,419			—			7,419
Corporate obligations	62			22,165			223			22,450
U.S. agency mortgage-backed securities	—			6,403			—			6,403
Non-U.S. agency mortgage-backed securities	—			2,813			—			2,813
Total debt securities - available-for-sale	3,508			39,026			223			42,757
Equity securities	1,972			22			64			2,058
Assets under management	1,930			2,271			103			4,304
Total assets at fair value	$	28,354		$	41,460		$	390		$	70,204
Percentage of total assets at fair value	40		%	59		%	1		%	100		%
December 31, 2020
Cash and cash equivalents	$	16,841		$	80		$	—		$	16,921
Debt securities - available-for-sale:
U.S. government and agency obligations	3,241			224			—			3,465
State and municipal obligations	—			7,328			—			7,328
Corporate obligations	25			19,424			288			19,737
U.S. agency mortgage-backed securities	—			7,091			—			7,091
Non-U.S. agency mortgage-backed securities	—			2,207			—			2,207
Total debt securities - available-for-sale	3,266			36,274			288			39,828
Equity securities	1,795			33			—			1,828
Assets under management	1,774			2,250			52			4,076
Total assets at fair value	$	23,676		$	38,637		$	340		$	62,653
Percentage of total assets at fair value	38		%	61		%	1		%	100		%

There were no transfers in or out of Level 3 financial assets or liabilities during the nine months ended September 30, 2021 or 2020.

The following table presents a summary of fair value measurements by level and carrying values for certain financial instruments not measured at fair value on a recurring basis in the Condensed Consolidated Balance Sheets:


(in millions)	Quoted Prices in Active Markets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total Fair Value		Total Carrying Value
September 30, 2021
Debt securities - held-to-maturity	$	525	$	88	$	7	$	620	$	616
Long-term debt and other financing obligations	$	—	$	53,425	$	—	$	53,425	$	46,965
December 31, 2020
Debt securities - held-to-maturity	$	466	$	108	$	73	$	647	$	638
Long-term debt and other financing obligations	$	—	$	51,254	$	—	$	51,254	$	42,171

Nonfinancial assets and liabilities or financial assets and liabilities that are measured at fair value on a nonrecurring basis are subject to fair value adjustments only in certain circumstances, such as when the Company records an impairment. There were no significant fair value adjustments for these assets and liabilities recorded during either the nine months ended September 30, 2021 or 2020.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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