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Investments | 12 Months Ended
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Dec. 31, 2023
Investments [Abstract] |
Investments | Investments Total investments at December 31, 2023 and 2022 were as follows:
| 2023 |  | 2022
In millions | Current |  | Long-term |  | Total |  | Current |  | Long-term |  | Total
Debt securities available for sale | $ | 3,131 |  |  | $ | 18,582 |  |  | $ | 21,713 |  |  | $ | 2,718 |  |  | $ | 17,562 |  |  | $ | 20,280 |
Mortgage loans | 128 |  |  | 1,183 |  |  | 1,311 |  |  | 55 |  |  | 989 |  |  | 1,044 |
Other investments | — |  |  | 3,254 |  |  | 3,254 |  |  | 5 |  |  | 2,562 |  |  | 2,567 |
Total investments (1) | $ | 3,259 |  |  | $ | 23,019 |  |  | $ | 26,278 |  |  | $ | 2,778 |  |  | $ | 21,113 |  |  | $ | 23,891 |
_____________________________________________ (1)Includes long-term investments of $17 million which were accounted for as assets held for sale and were included in assets held for sale on the consolidated balance sheet at December 31, 2022. See Note 2 ‘‘Acquisitions, Divestitures and Asset Sales’’ for additional information. At December 31, 2023 and 2022, the Company held investments of $307 million and $331 million, respectively, related to the 2012 conversion of an existing group annuity contract from a participating to a non-participating contract. These investments are included in the total investments of large case pensions supporting non-experience-rated products. Although these investments are not accounted for as Separate Accounts assets, they are legally segregated and are not subject to claims that arise out of the Company’s business and only support future policy benefits obligations under that group annuity contract. Debt Securities Debt securities available for sale at December 31, 2023 and 2022 were as follows:
In millions |  |  |  |  | Gross Amortized Cost |  | Allowance for Credit Losses |  | Net Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Debt securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government securities |  |  |  |  | $ | 2,071 |  |  | $ | — |  |  | $ | 2,071 |  |  | $ | 19 |  |  | $ | (54) |  |  | $ | 2,036 |
States, municipalities and political subdivisions |  |  |  |  | 2,219 |  |  | — |  |  | 2,219 |  |  | 31 |  |  | (35) |  |  | 2,215 |
U.S. corporate securities |  |  |  |  | 10,156 |  |  | — |  |  | 10,156 |  |  | 133 |  |  | (446) |  |  | 9,843 |
Foreign securities |  |  |  |  | 2,593 |  |  | — |  |  | 2,593 |  |  | 41 |  |  | (122) |  |  | 2,512 |
Residential mortgage-backed securities |  |  |  |  | 862 |  |  | — |  |  | 862 |  |  | 8 |  |  | (60) |  |  | 810 |
Commercial mortgage-backed securities |  |  |  |  | 1,066 |  |  | — |  |  | 1,066 |  |  | 9 |  |  | (100) |  |  | 975 |
Other asset-backed securities |  |  |  |  | 3,294 |  |  | — |  |  | 3,294 |  |  | 26 |  |  | (18) |  |  | 3,302 |
Redeemable preferred securities |  |  |  |  | 21 |  |  | — |  |  | 21 |  |  | — |  |  | (1) |  |  | 20 |
Total debt securities (1) |  |  |  |  | $ | 22,282 |  |  | $ | — |  |  | $ | 22,282 |  |  | $ | 267 |  |  | $ | (836) |  |  | $ | 21,713 |
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Debt securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government securities |  |  |  |  | $ | 2,074 |  |  | $ | — |  |  | $ | 2,074 |  |  | $ | — |  |  | $ | (182) |  |  | $ | 1,892 |
States, municipalities and political subdivisions |  |  |  |  | 2,393 |  |  | — |  |  | 2,393 |  |  | 8 |  |  | (129) |  |  | 2,272 |
U.S. corporate securities |  |  |  |  | 9,838 |  |  | (3) |  |  | 9,835 |  |  | 26 |  |  | (903) |  |  | 8,958 |
Foreign securities |  |  |  |  | 2,780 |  |  | (1) |  |  | 2,779 |  |  | 15 |  |  | (244) |  |  | 2,550 |
Residential mortgage-backed securities |  |  |  |  | 845 |  |  | — |  |  | 845 |  |  | 1 |  |  | (89) |  |  | 757 |
Commercial mortgage-backed securities |  |  |  |  | 1,172 |  |  | — |  |  | 1,172 |  |  | 1 |  |  | (155) |  |  | 1,018 |
Other asset-backed securities |  |  |  |  | 2,940 |  |  | — |  |  | 2,940 |  |  | 6 |  |  | (136) |  |  | 2,810 |
Redeemable preferred securities |  |  |  |  | 25 |  |  | — |  |  | 25 |  |  | — |  |  | (2) |  |  | 23 |
Total debt securities (1) |  |  |  |  | $ | 22,067 |  |  | $ | (4) |  |  | $ | 22,063 |  |  | $ | 57 |  |  | $ | (1,840) |  |  | $ | 20,280 |
_____________________________________________ (1)Investment risks associated with the Company’s experience-rated products generally do not impact the Company’s consolidated operating results. At December 31, 2023, debt securities with a fair value of $592 million, gross unrealized capital gains of $10 million and gross unrealized capital losses of $28 million, and at December 31, 2022, debt securities with a fair value of $609 million, gross unrealized capital gains of $3 million and gross unrealized capital losses of $59 million were included in total debt securities, but support experience-rated products. Changes in net unrealized capital gains (losses) on these securities are not reflected in accumulated other comprehensive loss. The amortized cost and fair value of debt securities at December 31, 2023 are shown below by contractual maturity. Actual maturities may differ from contractual maturities because securities may be restructured, called or prepaid, or the Company intends to sell a security prior to maturity.
In millions | Amortized Cost |  | Fair Value
Due to mature: |  |  |
Less than one year | $ | 1,244 |  |  | $ | 1,230 |
One year through five years | 7,563 |  |  | 7,390 |
After five years through ten years | 4,302 |  |  | 4,204 |
Greater than ten years | 3,951 |  |  | 3,802 |
Residential mortgage-backed securities | 862 |  |  | 810 |
Commercial mortgage-backed securities | 1,066 |  |  | 975 |
Other asset-backed securities | 3,294 |  |  | 3,302 |
Total | $ | 22,282 |  |  | $ | 21,713 |
Mortgage-Backed and Other Asset-Backed Securities All of the Company’s residential mortgage-backed securities at December 31, 2023 were issued by the Government National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation and carry agency guarantees and explicit or implicit guarantees by the U.S. Government. At December 31, 2023, the Company’s residential mortgage-backed securities had an average credit quality rating of AA and a weighted average duration of 5.9 years. The Company’s commercial mortgage-backed securities have underlying loans that are dispersed throughout the U.S. Significant market observable inputs used to value these securities include loss severity and probability of default. At December 31, 2023, these securities had an average credit quality rating of AAA and a weighted average duration of 5.4 years. The Company’s other asset-backed securities have a variety of underlying collateral (e.g., automobile loans, credit card receivables, home equity loans and commercial loans). Significant market observable inputs used to value these securities include the unemployment rate, loss severity and probability of default. At December 31, 2023, these securities had an average credit quality rating of AA and a weighted average duration of less than one year. Summarized below are the debt securities the Company held at December 31, 2023 and 2022 that were in an unrealized capital loss position, aggregated by the length of time the investments have been in that position:
| Less than 12 months |  | Greater than 12 months |  | Total
In millions, except number of securities | Number of Securities |  | Fair Value |  | Unrealized Losses |  | Number of Securities |  | Fair Value |  | Unrealized Losses |  | Number of Securities |  | Fair Value |  | Unrealized Losses
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Debt securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government securities | 74 |  |  | $ | 194 |  |  | $ | 2 |  |  | 280 |  |  | $ | 891 |  |  | $ | 52 |  |  | 354 |  |  | $ | 1,085 |  |  | $ | 54 |
States, municipalities and political subdivisions | 95 |  |  | 181 |  |  | 1 |  |  | 455 |  |  | 733 |  |  | 34 |  |  | 550 |  |  | 914 |  |  | 35 |
U.S. corporate securities | 576 |  |  | 672 |  |  | 14 |  |  | 4,120 |  |  | 5,602 |  |  | 432 |  |  | 4,696 |  |  | 6,274 |  |  | 446 |
Foreign securities | 160 |  |  | 243 |  |  | 4 |  |  | 964 |  |  | 1,407 |  |  | 118 |  |  | 1,124 |  |  | 1,650 |  |  | 122 |
Residential mortgage-backed securities | 33 |  |  | 97 |  |  | 1 |  |  | 461 |  |  | 517 |  |  | 59 |  |  | 494 |  |  | 614 |  |  | 60 |
Commercial mortgage-backed securities | 44 |  |  | 94 |  |  | 2 |  |  | 287 |  |  | 581 |  |  | 98 |  |  | 331 |  |  | 675 |  |  | 100 |
Other asset-backed securities | 196 |  |  | 449 |  |  | 4 |  |  | 443 |  |  | 867 |  |  | 14 |  |  | 639 |  |  | 1,316 |  |  | 18 |
Redeemable preferred securities | 4 |  |  | 2 |  |  | — |  |  | 8 |  |  | 18 |  |  | 1 |  |  | 12 |  |  | 20 |  |  | 1 |
Total debt securities | 1,182 |  |  | $ | 1,932 |  |  | $ | 28 |  |  | 7,018 |  |  | $ | 10,616 |  |  | $ | 808 |  |  | 8,200 |  |  | $ | 12,548 |  |  | $ | 836 |
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Debt securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government securities | 519 |  |  | $ | 1,620 |  |  | $ | 164 |  |  | 35 |  |  | $ | 191 |  |  | $ | 18 |  |  | 554 |  |  | $ | 1,811 |  |  | $ | 182 |
States, municipalities and political subdivisions | 859 |  |  | 1,370 |  |  | 95 |  |  | 196 |  |  | 322 |  |  | 34 |  |  | 1,055 |  |  | 1,692 |  |  | 129 |
U.S. corporate securities | 5,193 |  |  | 6,537 |  |  | 622 |  |  | 1,479 |  |  | 1,822 |  |  | 281 |  |  | 6,672 |  |  | 8,359 |  |  | 903 |
Foreign securities | 1,168 |  |  | 1,715 |  |  | 147 |  |  | 403 |  |  | 592 |  |  | 97 |  |  | 1,571 |  |  | 2,307 |  |  | 244 |
Residential mortgage-backed securities | 452 |  |  | 464 |  |  | 39 |  |  | 91 |  |  | 257 |  |  | 50 |  |  | 543 |  |  | 721 |  |  | 89 |
Commercial mortgage-backed securities | 288 |  |  | 611 |  |  | 69 |  |  | 187 |  |  | 381 |  |  | 86 |  |  | 475 |  |  | 992 |  |  | 155 |
Other asset-backed securities | 1,008 |  |  | 1,893 |  |  | 88 |  |  | 391 |  |  | 694 |  |  | 48 |  |  | 1,399 |  |  | 2,587 |  |  | 136 |
Redeemable preferred securities | 13 |  |  | 18 |  |  | 2 |  |  | 2 |  |  | 5 |  |  | — |  |  | 15 |  |  | 23 |  |  | 2 |
Total debt securities | 9,500 |  |  | $ | 14,228 |  |  | $ | 1,226 |  |  | 2,784 |  |  | $ | 4,264 |  |  | $ | 614 |  |  | 12,284 |  |  | $ | 18,492 |  |  | $ | 1,840 |
The Company reviewed the securities in the table above and concluded that they are performing assets generating investment income to support the needs of the Company’s business. In performing this review, the Company considered factors such as the quality of the investment security based on research performed by the Company’s internal credit analysts and external rating agencies and the prospects of realizing the carrying value of the security based on the investment’s current prospects for recovery. Unrealized capital losses at December 31, 2023 were generally caused by interest rate increases and not by unfavorable changes in the credit quality associated with these securities. As of December 31, 2023, the Company did not intend to sell these securities, and did not believe it was more likely than not that it would be required to sell these securities prior to the anticipated recovery of their amortized cost basis. The maturity dates for debt securities in an unrealized capital loss position at December 31, 2023 were as follows:
| Supporting experience- rated products |  | Supporting remaining products |  | Total
In millions | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
Due to mature: |  |  |  |  |  |  |  |  |  |  |
Less than one year | $ | 15 |  |  | $ | — |  |  | $ | 1,057 |  |  | $ | 16 |  |  | $ | 1,072 |  |  | $ | 16 |
One year through five years | 128 |  |  | 3 |  |  | 4,504 |  |  | 226 |  |  | 4,632 |  |  | 229 |
After five years through ten years | 87 |  |  | 7 |  |  | 1,925 |  |  | 172 |  |  | 2,012 |  |  | 179 |
Greater than ten years | 137 |  |  | 14 |  |  | 2,090 |  |  | 220 |  |  | 2,227 |  |  | 234 |
Residential mortgage-backed securities | 9 |  |  | 1 |  |  | 605 |  |  | 59 |  |  | 614 |  |  | 60 |
Commercial mortgage-backed securities | 15 |  |  | 2 |  |  | 660 |  |  | 98 |  |  | 675 |  |  | 100 |
Other asset-backed securities | 12 |  |  | 1 |  |  | 1,304 |  |  | 17 |  |  | 1,316 |  |  | 18 |
Total | $ | 403 |  |  | $ | 28 |  |  | $ | 12,145 |  |  | $ | 808 |  |  | $ | 12,548 |  |  | $ | 836 |
Mortgage Loans The Company’s mortgage loans are collateralized by commercial real estate. During the years ended December 31, 2023 and 2022, the Company had the following activity in its mortgage loan portfolio:
In millions | 2023 |  | 2022
New mortgage loans | $ | 342 |  |  | $ | 356 |
Mortgage loans fully repaid | 43 |  |  | 178 |
Mortgage loans foreclosed | — |  |  | — |
The Company assesses mortgage loans on a regular basis for credit impairments, and assigns a credit quality indicator to each loan. The Company’s credit quality indicator is internally developed and categorizes each loan in its portfolio on a scale from 1 to 7. These indicators are based upon several factors, including current loan-to-value ratios, current and future property cash flow, property condition, market trends, creditworthiness of the borrower and deal structure. •Category 1 - Represents loans of superior quality. •Categories 2 to 4 - Represent loans where credit risk is minimal to acceptable; however, these loans may display some susceptibility to economic changes. •Categories 5 and 6 - Represent loans where credit risk is not substantial, but these loans warrant management’s close attention. •Category 7 - Represents loans where collections are potentially at risk; if necessary, an impairment is recorded. Based upon the Company’s assessments at December 31, 2023 and 2022, the amortized cost basis of the Company’s mortgage loans within each credit quality indicator by year of origination was as follows:
| Amortized Cost Basis by Year of Origination
In millions, except credit quality indicator | 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior |  | Total
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |
1 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 11 |  |  | $ | 11 |
2 to 4 | 302 |  |  | 346 |  |  | 225 |  |  | 35 |  |  | 11 |  |  | 343 |  |  | 1,262 |
5 and 6 | — |  |  | — |  |  | 13 |  |  | — |  |  | — |  |  | 19 |  |  | 32 |
7 | — |  |  | — |  |  | 6 |  |  | — |  |  | — |  |  | — |  |  | 6 |
Total | $ | 302 |  |  | $ | 346 |  |  | $ | 244 |  |  | $ | 35 |  |  | $ | 11 |  |  | $ | 373 |  |  | $ | 1,311 |
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |
1 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 15 |  |  | $ | 15 |
2 to 4 |  |  | 326 |  |  | 247 |  |  | 36 |  |  | 11 |  |  | 402 |  |  | 1,022 |
5 and 6 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 7 |  |  | 7 |
7 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total |  |  | $ | 326 |  |  | $ | 247 |  |  | $ | 36 |  |  | $ | 11 |  |  | $ | 424 |  |  | $ | 1,044 |
At December 31, 2023 scheduled mortgage loan principal repayments were as follows:
In millions |
2024 | $ | 128 |
2025 | 123 |
2026 | 179 |
2027 | 229 |
2028 | 300 |
Thereafter | 352 |
Total | $ | 1,311 |
Net Investment Income Sources of net investment income for the years ended December 31, 2023, 2022 and 2021 were as follows:
In millions | 2023 |  | 2022 |  | 2021
Debt securities | $ | 841 |  |  | $ | 702 |  |  | $ | 634 |
Mortgage loans | 59 |  |  | 51 |  |  | 55 |
Other investments | 796 |  |  | 448 |  |  | 381 |
Gross investment income | 1,696 |  |  | 1,201 |  |  | 1,070 |
Investment expenses | (46) |  |  | (43) |  |  | (47) |
Net investment income (excluding net realized capital gains or losses) | 1,650 |  |  | 1,158 |  |  | 1,023 |
Net realized capital gains (losses) (1) | (497) |  |  | (320) |  |  | 176 |
Net investment income (2) | $ | 1,153 |  |  | $ | 838 |  |  | $ | 1,199 |
_____________________________________________ (1)Net realized capital losses include yield-related impairment losses on debt securities of $152 million and are net of the reversal of previously recorded credit-related impairment losses on debt securities of $3 million in the year ended December 31, 2023. Net realized capital losses include yield-related impairment losses on debt securities of $143 million and credit-related impairment losses on debt securities of $13 million in the year ended December 31, 2022. Net realized capital gains are net of yield-related impairment losses on debt securities of $42 million for the year ended December 31, 2021. There were no credit-related impairment losses on debt securities in the year ended December 31, 2021. (2)Net investment income includes $34 million, $35 million and $38 million for the years ended December 31, 2023, 2022 and 2021, respectively, related to investments supporting experience-rated products. Capital gains and losses recognized during the year ended December 31, 2023 related to investments in equity securities held as of December 31, 2023 were not material. Excluding amounts related to experience-rated products, proceeds from the sale of available-for-sale debt securities and the related gross realized capital gains and losses in the years ended December 31, 2023, 2022 and 2021 were as follows:
In millions | 2023 |  | 2022 |  | 2021
Proceeds from sales | $ | 5,031 |  |  | $ | 4,243 |  |  | $ | 3,572 |
Gross realized capital gains | 9 |  |  | 24 |  |  | 72 |
Gross realized capital losses | 420 |  |  | 177 |  |  | 14 |

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