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Equity Securities

6 Months Ended

Jun. 30, 2025

Investments, Debt and Equity Securities [Abstract]

Equity Securities

3. Available-For-Sale Fixed Maturity Securities

The total amortized cost, fair value, allowance for credit losses, and gross unrealized gains and losses of available-for-sale fixed maturity securities are shown below:

			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Allowance for Credit Losses						Fair Value
			(Dollars in millions)
June 30, 2025
U.S. treasury and government			$	93					$	1					$	(1)					$	—					$	93
U.S. state and municipal			3,093						63						(35)						—						3,121
Foreign governments			1,315						16						(13)						—						1,318
Corporate debt securities			34,373						733						(217)						(1)						34,888
Residential mortgage-backed securities			966						35						(2)						—						999
Commercial mortgage-backed securities			3,196						98						(35)						—						3,259
Collateralized debt securities			5,224						92						(62)						(1)						5,253
Total fixed maturity securities			$	48,260					$	1,038					$	(365)					$	(2)					$	48,931
December 31, 2024
U.S. treasury and government			$	87					$	—					$	(1)					$	—					$	86
U.S. state and municipal			3,200						37						(30)						—						3,207
Foreign governments			1,568						6						(33)						—						1,541
Corporate debt securities			32,770						454						(350)						(26)						32,848
Residential mortgage-backed securities			1,086						25						(4)						(1)						1,106
Commercial mortgage-backed securities			2,755						65						(24)						—						2,796
Collateralized debt securities			5,661						77						(30)						—						5,708
Total fixed maturity securities			$	47,127					$	664					$	(472)					$	(27)					$	47,292

The amortized cost and fair value of available-for-sale fixed maturity securities at June 30, 2025, by contractual maturity are shown below. Actual maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Residential and commercial mortgage-backed securities and collateralized debt securities, which are not due at a single maturity, have been separately presented below.

			Available-For-Sale
			Amortized Cost						Fair Value
			(Dollars in millions)
Due in one year or less			$	1,711					$	1,713
Due after one year through five years			16,509						16,774
Due after five years through ten years			5,284						5,426
Due after ten years			15,370						15,507
			38,874						39,420
Residential mortgage-backed securities			966						999
Commercial mortgage-backed securities			3,196						3,259
Collateralized debt securities			5,224						5,253
Total			$	48,260					$	48,931

Proceeds from sales of available-for-sale fixed maturity securities, with the related gross realized gains and losses, are shown below:

			Three Months Ended June 30,												Six Months Ended June 30,
			2025						2024						2025						2024
			(Dollars in millions)
Proceeds from sales of available-for-sale fixed maturity securities			$	3,533					$	1,820					$	4,881					$	2,413
Gross realized gains			8						2						10						4
Gross realized (losses)			(61)						(21)						(62)						(23)

The Company has pledged bonds in connection with certain agreements and transactions, such as financing and reinsurance agreements. The carrying value of bonds pledged was $9.6 billion and $8.8 billion as of June 30, 2025 and December 31, 2024, respectively.

In accordance with various regulations, the Company has securities on deposit with regulating authorities with a carrying value of $65 million and $65 million as of June 30, 2025 and December 31, 2024, respectively. There are no restrictions on these assets.

As of June 30, 2025 and December 31, 2024, amounts loaned under reverse repurchase agreements were $400 million and $400 million, respectively, and the fair value of the collateral, comprised of equity securities, was $1.0 billion and $783 million, respectively.

The gross unrealized losses and fair value of available-for-sale fixed maturity securities, aggregated by investment category and the length of time individual securities have been in a continuous unrealized loss position due to market factors are shown below:

			Less than 12 months																		12 months or more																		Total
			Number of Issues						Gross Unrealized Losses (1)						Fair Value						Number of Issues						Gross Unrealized Losses (1)						Fair Value						Number of Issues						Gross Unrealized Losses (1)						Fair Value
			(Dollars in millions)
June 30, 2025
U.S. treasury and government			1						$	—					$	8					3						$	(1)					$	51					4						$	(1)					$	59
U.S. state and municipal			140						(17)						788						93						(18)						222						233						(35)						1,010
Foreign governments			9						(13)						452						2						—						25						11						(13)						477
Corporate debt securities			633						(118)						4,706						267						(99)						3,024						900						(217)						7,730
Residential mortgage-backed securities			38						(1)						138						4						(1)						21						42						(2)						159
Commercial mortgage-backed securities			47						(26)						481						15						(9)						137						62						(35)						618
Collateralized debt securities			124						(27)						1,406						19						(35)						467						143						(62)						1,873
Total			992						$	(202)					$	7,979					403						$	(163)					$	3,947					1,395						$	(365)					$	11,926
December 31, 2024
U.S. treasury and government			3						$	—					$	29					1						$	(1)					$	36					4						$	(1)					$	65
U.S. state and municipal			174						(20)						851						190						(10)						280						364						(30)						1,131
Foreign governments			8						(33)						1,206						—						—						—						8						(33)						1,206
Corporate debt securities			1,514						(165)						6,615						384						(185)						4,015						1,898						(350)						10,630
Residential mortgage-backed securities			47						(3)						178						16						(1)						61						63						(4)						239
Commercial mortgage-backed securities			104						(24)						667						—						—						—						104						(24)						667
Collateralized debt securities			178						(29)						1,182						5						(1)						22						183						(30)						1,204
Total			2,028						$	(274)					$	10,728					596						$	(198)					$	4,414					2,624						$	(472)					$	15,142

(1)Unrealized losses have been reduced to reflect the allowance for credit losses of $2 million and $27 million as of June 30, 2025 and December 31, 2024, respectively.

The unrealized losses as of June 30, 2025 and December 31, 2024 are principally related to the timing of the purchases of certain securities, which carry less yield than those available as of those dates. Approximately 96% and 89% of the unrealized losses on fixed maturity securities shown in the above table for June 30, 2025 and December 31, 2024, respectively, are on securities that are rated investment grade, defined as being the highest two NAIC designations.

The Company expects to recover the amortized cost on all securities except for those securities on which it recognized an allowance for credit loss. In addition, as the Company did not have the intent to sell fixed maturity securities with unrealized losses and it was not more likely than not that the Company would be required to sell these securities prior to recovery of the amortized cost, which may be maturity, the Company did not write down these investments to fair value through the Consolidated Statements of Operations.

Allowance for Credit Losses

Several assumptions and underlying estimates are made in the evaluation of allowance for credit loss. Examples include financial condition, near-term and long-term prospects of the issue or issuer, including relevant industry conditions and trends and implications of rating agency actions and offering prices. Based on this evaluation, unrealized losses on available-for-sale securities where an allowance for credit loss was not recorded were concentrated within the financials sector as of June 30, 2025 and December 31, 2024.

The rollforward of the allowance for credit losses for available-for-sale fixed maturity securities is shown below:

			Three Months Ended June 30, 2025
			Corporate Securities						Residential Mortgage Backed Securities												Collateralized Debt Securities						Total
			(Dollars in millions)
Beginning balance			$	(9)					$	(1)											$	(1)					$	(11)
Credit losses recognized on securities for which credit losses were not previously recorded			(3)						—												(1)						(4)
Reductions for securities sold during the period			—						—												—						—
Allowance on securities that had an allowance recorded in a previous period			11						1												1						13
Balance as of June 30, 2025			$	(1)					$	—											$	(1)					$	(2)
			Three Months Ended June 30, 2024
			Corporate Securities						Residential Mortgage Backed Securities												Collateralized Debt Securities						Total
			(Dollars in millions)
Beginning balance			$	(24)					$	(1)											$	(3)					$	(28)
Credit losses recognized on securities for which credit losses were not previously recorded			(13)						—												—						(13)
Reductions for securities sold during the period			—						—												—						—
Allowance on securities that had an allowance recorded in a previous period			3						—												1						4
Balance as of June 30, 2024			$	(34)					$	(1)											$	(2)					$	(37)
			Six Months Ended June 30, 2025
			Corporate Securities						Residential Mortgage Backed Securities												Collateralized Debt Securities						Total
			(Dollars in millions)
Beginning balance			$	(26)					$	(1)											$	—					$	(27)
Credit losses recognized on securities for which credit losses were not previously recorded			(10)						—												(2)						(12)
Reductions for securities sold during the period			16						—												—						16
Allowance on securities that had an allowance recorded in a previous period			19						1												1						21
Balance as of June 30, 2025			$	(1)					$	—											$	(1)					$	(2)
			Six Months Ended June 30, 2024
			Corporate Securities						Residential Mortgage Backed Securities												Collateralized Debt Securities						Total
			(Dollars in millions)
Beginning balance			$	(19)					$	(1)											$	(4)					$	(24)
Credit losses recognized on securities for which credit losses were not previously recorded			(33)						—												—						(33)
Reductions for securities sold during the period			1						—												—						1
Allowance on securities that had an allowance recorded in a previous period			17						—												1						18
Balance as of June 30, 2024			$	(34)					$	(1)											$	(2)					$	(37)

4. Equity Securities

The net gains (losses) on equity securities recognized in “Investment related gains (losses)” on the Consolidated Statements of Operations are shown below:

			Three Months Ended June 30,												Six Months Ended June 30,
			2025						2024						2025						2024
			(Dollars in millions)
Unrealized gains (losses) on equity securities			$	104					$	33					$	97					$	22
Net gains (losses) on equity securities sold			(1)						2						1						2
Net gains (losses) on equity securities			$	103					$	35					$	98					$	24

Equity securities by market sector distribution are shown below, based on carrying value:

			June 30, 2025						December 31, 2024
Consumer goods			7		%				5		%
Education			20		%				20		%
Energy and utilities			36		%				10		%
Finance			7		%				48		%
Healthcare			3		%				2		%
Industrials			22		%				12		%
Other			5		%				3		%
Total			100		%				100		%

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- References

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- Definition

The entire disclosure for investments in certain debt and equity securities.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 940
-SubTopic 320
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/940-320/tableOfContent

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Name Regulation S-K (SK)
-Number 229
-Section 1403
-Paragraph b
-Publisher SEC

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/320/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481800/320-10-50-10

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6B
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B

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-SubTopic 320
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/942-320/tableOfContent

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