Georgia
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58-1167100
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1932 Wynnton Road, Columbus, Georgia
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31999
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(Address of principal executive offices)
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(ZIP Code)
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706.323.3431
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(Registrant's telephone number, including area code)
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(Former name, former address and former fiscal year, if changed since last report)
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
¨
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Emerging growth company
¨
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Class
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April 25, 2018
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Common Stock, $.10 Par Value
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774,167,054
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Page
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PART I.
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Item 1.
|
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||
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Three Months Ended March 31, 2018 and 2017
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Three Months Ended March 31, 2018 and 2017
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March 31, 2018, and December 31, 2017
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Three Months Ended March 31, 2018 and 2017
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Three Months Ended March 31, 2018 and 2017
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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/s/ KPMG LLP
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Three Months Ended
March 31, |
|
||||||||
(In millions, except for share and per-share amounts - Unaudited)
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2018
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|
2017
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|
||||||
Revenues:
|
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|
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||||
Net premiums, principally supplemental health insurance
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$
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4,745
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$
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4,638
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Net investment income
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837
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|
794
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|
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Realized investment gains (losses):
|
|
|
|
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|
||||
Other-than-temporary impairment losses realized
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(7
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)
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(10
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)
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||
Other gains (losses)
(1)
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(127
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)
|
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(130
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)
|
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||
Total realized investment gains (losses)
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(134
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)
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(140
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)
|
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||
Other income (loss)
|
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16
|
|
|
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17
|
|
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Total revenues
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5,464
|
|
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5,309
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|
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Benefits and expenses:
|
|
|
|
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|
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||||
Benefits and claims, net
|
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3,042
|
|
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3,052
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|
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||
Acquisition and operating expenses:
|
|
|
|
|
|
|
||||
Amortization of deferred policy acquisition costs
|
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314
|
|
|
|
294
|
|
|
||
Insurance commissions
|
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337
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|
|
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328
|
|
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||
Insurance and other expenses
|
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733
|
|
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675
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|
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Interest expense
|
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56
|
|
|
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62
|
|
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||
Total acquisition and operating expenses
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1,440
|
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1,359
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|
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||
Total benefits and expenses
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4,482
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4,411
|
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Earnings before income taxes
|
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982
|
|
|
|
898
|
|
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||
Income taxes
|
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265
|
|
|
|
306
|
|
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||
Net earnings
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$
|
717
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$
|
592
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Net earnings per share:
|
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Basic
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$
|
.92
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|
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$
|
.74
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Diluted
|
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.91
|
|
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|
.73
|
|
|
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Weighted-average outstanding common shares used in
computing earnings per share (In thousands): |
|
|
|
|
|
|
||||
Basic
|
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778,550
|
|
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802,259
|
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Diluted
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783,852
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|
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808,138
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Cash dividends per share
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$
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.26
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$
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.22
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Three Months Ended
March 31, |
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(In millions - Unaudited)
|
2018
|
2017
|
||||||||
Net earnings
|
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$
|
717
|
|
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$
|
592
|
|
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Other comprehensive income (loss) before income taxes:
|
|
|
|
|
|
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||||
Unrealized foreign currency translation gains (losses) during
period |
|
824
|
|
|
|
375
|
|
|
||
Unrealized gains (losses) on fixed maturity securities:
(1)
|
|
|
|
|
|
|
||||
Unrealized holding gains (losses) on fixed maturity securities
during period |
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(1,931
|
)
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(526
|
)
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Reclassification adjustment for realized (gains) losses on
fixed maturity securities included in net earnings |
|
(2
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)
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16
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|
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||
Unrealized gains (losses) on derivatives during period
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6
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2
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Pension liability adjustment during period
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(3
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)
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(2
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)
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Total other comprehensive income (loss) before income taxes
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(1,106
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)
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(135
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)
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||
Income tax expense (benefit) related to items of other comprehensive
income (loss) |
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(763
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)
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(137
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)
|
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||
Other comprehensive income (loss), net of income taxes
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(343
|
)
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2
|
|
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||
Total comprehensive income (loss)
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$
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374
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|
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$
|
594
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(In millions)
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March 31,
2018 (Unaudited) |
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December 31,
2017 |
||||||||
Assets:
|
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||||
Investments and cash:
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||||
Securities available for sale, at fair value:
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Fixed maturity securities (amortized cost $76,912 in 2018 and
$70,594 in 2017) (1) |
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$
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83,602
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$
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78,804
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Fixed maturity securities - consolidated variable interest entities (amortized
cost $4,695 in 2018 and $4,538 in 2017) (1) |
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5,431
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5,509
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||
Securities held to maturity, at amortized cost:
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Fixed maturity securities (fair value $40,468 in 2018 and $38,072 in 2017)
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33,377
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31,430
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Equity securities, at fair value:
|
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||||
Equity securities
(1)
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348
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|
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270
|
|
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||
Equity securities - consolidated variable interest entities
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760
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753
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Other investments
(2)
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5,073
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3,402
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Cash and cash equivalents
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4,080
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3,491
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|
|
||
Total investments and cash
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132,671
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|
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123,659
|
|
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Receivables
|
|
906
|
|
|
|
|
827
|
|
|
||
Accrued investment income
|
|
745
|
|
|
|
|
769
|
|
|
||
Deferred policy acquisition costs
|
|
9,933
|
|
|
|
|
9,505
|
|
|
||
Property and equipment, at cost less accumulated depreciation
|
|
448
|
|
|
|
|
434
|
|
|
||
Other
(3)
|
|
2,653
|
|
|
|
|
2,023
|
|
|
||
Total assets
|
|
$
|
147,356
|
|
|
|
|
$
|
137,217
|
|
|
(In millions, except for share and per-share amounts)
|
March 31,
2018 (Unaudited) |
|
December 31,
2017 |
||||||||
Liabilities and shareholders’ equity:
|
|
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
||||
Policy liabilities:
|
|
|
|
|
|
|
|
||||
Future policy benefits
|
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$
|
87,268
|
|
|
|
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$
|
81,857
|
|
|
Unpaid policy claims
|
|
4,630
|
|
|
|
|
4,392
|
|
|
||
Unearned premiums
|
|
6,084
|
|
|
|
|
5,959
|
|
|
||
Other policyholders’ funds
|
|
7,417
|
|
|
|
|
6,939
|
|
|
||
Total policy liabilities
|
|
105,399
|
|
|
|
|
99,147
|
|
|
||
Income taxes
|
|
4,407
|
|
|
|
|
4,745
|
|
|
||
Payables for return of cash collateral on loaned securities
|
|
5,368
|
|
|
|
|
606
|
|
|
||
Notes payable
|
|
5,372
|
|
|
|
|
5,289
|
|
|
||
Other
(4)
|
|
2,523
|
|
|
|
|
2,832
|
|
|
||
Total liabilities
|
|
123,069
|
|
|
|
|
112,619
|
|
|
||
Commitments and contingent liabilities (Note 13)
|
|
|
|
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
|
|
|
|
||||
Common stock of $.10 par value. In thousands: authorized 3,800,000
shares in 2018 and 2017; issued 1,346,776 shares in 2018 and 1,345,762 shares in 2017 |
|
135
|
|
|
|
|
135
|
|
|
||
Additional paid-in capital
|
|
2,089
|
|
|
|
|
2,052
|
|
|
||
Retained earnings
|
|
30,183
|
|
|
|
|
29,895
|
|
|
||
Accumulated other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||
Unrealized foreign currency translation gains (losses)
|
|
(1,303
|
)
|
|
|
|
(1,750
|
)
|
|
||
Unrealized gains (losses) on fixed maturity securities
(5)
|
|
5,206
|
|
|
|
|
5,964
|
|
|
||
Unrealized gains (losses) on derivatives
|
|
(21
|
)
|
|
|
|
(23
|
)
|
|
||
Pension liability adjustment
|
|
(197
|
)
|
|
|
|
(163
|
)
|
|
||
Treasury stock, at average cost
|
|
(11,805
|
)
|
|
|
|
(11,512
|
)
|
|
||
Total shareholders’ equity
|
|
24,287
|
|
|
|
|
24,598
|
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
147,356
|
|
|
|
|
$
|
137,217
|
|
|
|
Three Months Ended
March 31, |
||||||||||
(In millions - Unaudited)
|
|
2018
|
|
|
|
2017
|
|
||||
Common stock:
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
|
$
|
135
|
|
|
|
|
$
|
135
|
|
|
Balance, end of period
|
|
135
|
|
|
|
|
135
|
|
|
||
Additional paid-in capital:
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
|
2,052
|
|
|
|
|
1,908
|
|
|
||
Exercise of stock options
|
|
14
|
|
|
|
|
10
|
|
|
||
Share-based compensation
|
|
10
|
|
|
|
|
12
|
|
|
||
Gain (loss) on treasury stock reissued
|
|
13
|
|
|
|
|
10
|
|
|
||
Balance, end of period
|
|
2,089
|
|
|
|
|
1,940
|
|
|
||
Retained earnings:
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
|
29,895
|
|
|
|
|
25,981
|
|
|
||
Cumulative effect of change in accounting principle - financial instruments,
net of income taxes (1) |
|
148
|
|
|
|
|
0
|
|
|
||
Cumulative effect of change in accounting principle - tax effects from tax reform
(1)
|
|
(374
|
)
|
|
|
|
0
|
|
|
||
Net earnings
|
|
717
|
|
|
|
|
592
|
|
|
||
Dividends to shareholders
|
|
(203
|
)
|
|
|
|
(173
|
)
|
|
||
Balance, end of period
|
|
30,183
|
|
|
|
|
26,400
|
|
|
||
Accumulated other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
|
4,028
|
|
|
|
|
2,630
|
|
|
||
Cumulative effect of change in accounting principle - financial instruments,
net of income taxes (1) |
|
(148
|
)
|
|
|
|
0
|
|
|
||
Cumulative effect of change in accounting principle - tax effects from tax reform
(1)
|
|
374
|
|
|
|
|
0
|
|
|
||
Unrealized foreign currency translation gains (losses) during
period, net of income taxes |
|
447
|
|
|
|
|
333
|
|
|
||
Unrealized gains (losses) on fixed maturity securities during
period, net of income taxes and reclassification adjustments (1) |
|
(984
|
)
|
|
|
|
(331
|
)
|
|
||
Unrealized gains (losses) on derivatives during period, net of
income taxes |
|
2
|
|
|
|
|
2
|
|
|
||
Pension liability adjustment during period, net of income taxes
|
|
(34
|
)
|
|
|
|
(2
|
)
|
|
||
Balance, end of period
|
|
3,685
|
|
|
|
|
2,632
|
|
|
||
Treasury stock:
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
|
(11,512
|
)
|
|
|
|
(10,172
|
)
|
|
||
Purchases of treasury stock
|
|
(309
|
)
|
|
|
|
(610
|
)
|
|
||
Cost of shares issued
|
|
16
|
|
|
|
|
15
|
|
|
||
Balance, end of period
|
|
(11,805
|
)
|
|
|
|
(10,767
|
)
|
|
||
Total shareholders’ equity
|
|
$
|
24,287
|
|
|
|
|
$
|
20,340
|
|
|
|
Three Months Ended March 31,
|
||||||||||
(In millions - Unaudited)
|
2018
|
|
2017
|
||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||
Net earnings
|
|
$
|
717
|
|
|
|
|
$
|
592
|
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
|
|
|
||||
Change in receivables and advance premiums
|
|
14
|
|
|
|
|
106
|
|
|
||
Capitalization of deferred policy acquisition costs
|
|
(349
|
)
|
|
|
|
(335
|
)
|
|
||
Amortization of deferred policy acquisition costs
|
|
314
|
|
|
|
|
294
|
|
|
||
Increase in policy liabilities
|
|
572
|
|
|
|
|
666
|
|
|
||
Change in income tax liabilities
|
|
(131
|
)
|
|
|
|
271
|
|
|
||
Realized investment (gains) losses
|
|
134
|
|
|
|
|
140
|
|
|
||
Other, net
|
|
(33
|
)
|
|
|
|
23
|
|
|
||
Net cash provided (used) by operating activities
|
|
1,238
|
|
|
|
|
1,757
|
|
|
||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||
Proceeds from investments sold or matured:
|
|
|
|
|
|
|
|
||||
Securities available for sale:
|
|
|
|
|
|
|
|
||||
Fixed maturity securities sold
|
|
433
|
|
|
|
|
1,385
|
|
|
||
Fixed maturity securities matured or called
|
|
510
|
|
|
|
|
204
|
|
|
||
Equity securities sold
|
|
157
|
|
|
|
|
155
|
|
|
||
Securities held to maturity:
|
|
|
|
|
|
|
|
||||
Fixed maturity securities matured or called
|
|
50
|
|
|
|
|
228
|
|
|
||
Other investments - loan receivables
|
|
146
|
|
|
|
|
34
|
|
|
||
Costs of investments acquired:
|
|
|
|
|
|
|
|
||||
Available-for-sale fixed maturity securities
|
|
(3,975
|
)
|
|
|
|
(3,726
|
)
|
|
||
Equity securities
|
|
(166
|
)
|
|
|
|
(157
|
)
|
|
||
Other investments - loan receivables
|
|
(1,772
|
)
|
|
|
|
(123
|
)
|
|
||
Other investments, excluding loan receivables, net
|
|
(125
|
)
|
|
|
|
(114
|
)
|
|
||
Settlement of derivatives, net
|
|
(1
|
)
|
|
|
|
(44
|
)
|
|
||
Cash received (pledged or returned) as collateral, net
|
|
4,578
|
|
|
|
|
654
|
|
|
||
Other, net
|
|
(34
|
)
|
|
|
|
(23
|
)
|
|
||
Net cash provided (used) by investing activities
|
|
(199
|
)
|
|
|
|
(1,527
|
)
|
|
||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||
Purchases of treasury stock
|
|
(296
|
)
|
|
|
|
(610
|
)
|
|
||
Proceeds from borrowings
|
|
2
|
|
|
|
|
524
|
|
|
||
Principal payments under debt obligations
|
|
0
|
|
|
|
|
(654
|
)
|
|
||
Dividends paid to shareholders
|
|
(195
|
)
|
|
|
|
(166
|
)
|
|
||
Change in investment-type contracts, net
|
|
7
|
|
|
|
|
18
|
|
|
||
Treasury stock reissued
|
|
14
|
|
|
|
|
11
|
|
|
||
Other, net
|
|
(5
|
)
|
|
|
|
1
|
|
|
||
Net cash provided (used) by financing activities
|
|
(473
|
)
|
|
|
|
(876
|
)
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
|
23
|
|
|
|
|
(8
|
)
|
|
||
Net change in cash and cash equivalents
|
|
589
|
|
|
|
|
(654
|
)
|
|
||
Cash and cash equivalents, beginning of period
|
|
3,491
|
|
|
|
|
4,859
|
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
4,080
|
|
|
|
|
$
|
4,205
|
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
||||
Income taxes paid
|
|
$
|
396
|
|
|
|
|
$
|
58
|
|
|
Interest paid
|
|
36
|
|
|
|
|
47
|
|
|
||
Noncash interest
|
|
21
|
|
|
|
|
15
|
|
|
||
Impairment losses included in realized investment losses
|
|
7
|
|
|
|
|
10
|
|
|
||
Noncash financing activities:
|
|
|
|
|
|
|
|
||||
Capital lease obligations
|
|
1
|
|
|
|
|
2
|
|
|
||
Treasury stock issued for:
|
|
|
|
|
|
|
|
||||
Associate stock bonus
|
|
5
|
|
|
|
|
6
|
|
|
||
Shareholder dividend reinvestment
|
|
8
|
|
|
|
|
7
|
|
|
||
Share-based compensation grants
|
|
2
|
|
|
|
|
1
|
|
|
1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
2.
|
BUSINESS SEGMENT INFORMATION
|
|
Three Months Ended
March 31, |
|
||||||
(In millions)
|
2018
|
|
2017
|
|
||||
Revenues:
|
|
|
|
|
||||
Aflac Japan:
|
|
|
|
|
||||
Net earned premiums
|
$
|
3,263
|
|
|
$
|
3,194
|
|
|
Net investment income, less amortized hedge costs
(1)
|
588
|
|
|
557
|
|
|
||
Other income
|
12
|
|
|
10
|
|
|
||
Total Aflac Japan
|
3,863
|
|
|
3,761
|
|
|
||
Aflac U.S.:
|
|
|
|
|
||||
Net earned premiums
|
1,427
|
|
|
1,390
|
|
|
||
Net investment income
|
175
|
|
|
178
|
|
|
||
Other income
|
2
|
|
|
1
|
|
|
||
Total Aflac U.S.
|
1,604
|
|
|
1,569
|
|
|
||
Corporate and other
(2)
|
79
|
|
|
67
|
|
|
||
Total adjusted revenues
|
5,546
|
|
|
5,397
|
|
|
||
Realized investment gains (losses)
(1),(2)
|
(82
|
)
|
|
(88
|
)
|
|
||
Total revenues
|
$
|
5,464
|
|
|
$
|
5,309
|
|
|
|
Three Months Ended
March 31, |
|
||||||
(In millions)
|
2018
|
|
2017
|
|
||||
Pretax earnings:
|
|
|
|
|
||||
Aflac Japan
(1)
|
$
|
818
|
|
|
$
|
769
|
|
|
Aflac U.S.
|
337
|
|
|
310
|
|
|
||
Corporate and other
(2)
|
(46
|
)
|
|
(52
|
)
|
|
||
Pretax adjusted earnings
|
1,109
|
|
|
1,027
|
|
|
||
Realized investment gains (losses)
(1),(2),(3)
|
(98
|
)
|
|
(109
|
)
|
|
||
Other income (loss)
|
(29
|
)
|
|
(20
|
)
|
|
||
Total earnings before income taxes
|
$
|
982
|
|
|
$
|
898
|
|
|
Income taxes applicable to pretax adjusted earnings
|
$
|
289
|
|
|
$
|
351
|
|
|
Effect of foreign currency translation on after-tax
adjusted earnings |
21
|
|
|
5
|
|
|
(In millions)
|
March 31,
2018 |
|
December 31,
2017 |
||||||||
Assets:
|
|
|
|
|
|
|
|
||||
Aflac Japan
|
|
$
|
125,174
|
|
|
|
|
$
|
114,402
|
|
|
Aflac U.S.
|
|
19,706
|
|
|
|
|
19,893
|
|
|
||
Corporate and other
|
|
2,476
|
|
|
|
|
2,922
|
|
|
||
Total assets
|
|
$
|
147,356
|
|
|
|
|
$
|
137,217
|
|
|
3.
|
INVESTMENTS
|
|
March 31, 2018
|
||||||||||||||||||||||
(In millions)
|
Cost or
Amortized Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||||||||||
Securities available for sale, carried at fair value
through other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Yen-denominated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Japan government and agencies
|
|
$
|
32,961
|
|
|
|
|
$
|
3,811
|
|
|
|
|
$
|
192
|
|
|
|
|
$
|
36,580
|
|
|
Municipalities
|
|
350
|
|
|
|
|
33
|
|
|
|
|
11
|
|
|
|
|
372
|
|
|
||||
Mortgage- and asset-backed securities
|
|
254
|
|
|
|
|
30
|
|
|
|
|
0
|
|
|
|
|
284
|
|
|
||||
Public utilities
|
|
1,739
|
|
|
|
|
325
|
|
|
|
|
4
|
|
|
|
|
2,060
|
|
|
||||
Sovereign and supranational
|
|
1,348
|
|
|
|
|
212
|
|
|
|
|
27
|
|
|
|
|
1,533
|
|
|
||||
Banks/financial institutions
|
|
5,157
|
|
|
|
|
799
|
|
|
|
|
76
|
|
|
|
|
5,880
|
|
|
||||
Other corporate
|
|
4,345
|
|
|
|
|
754
|
|
|
|
|
8
|
|
|
|
|
5,091
|
|
|
||||
Total yen-denominated
|
|
46,154
|
|
|
|
|
5,964
|
|
|
|
|
318
|
|
|
|
|
51,800
|
|
|
||||
U.S. dollar-denominated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
|
148
|
|
|
|
|
9
|
|
|
|
|
1
|
|
|
|
|
156
|
|
|
||||
Municipalities
|
|
866
|
|
|
|
|
135
|
|
|
|
|
0
|
|
|
|
|
1,001
|
|
|
||||
Mortgage- and asset-backed securities
|
|
165
|
|
|
|
|
7
|
|
|
|
|
1
|
|
|
|
|
171
|
|
|
||||
Public utilities
|
|
5,223
|
|
|
|
|
631
|
|
|
|
|
107
|
|
|
|
|
5,747
|
|
|
||||
Sovereign and supranational
|
|
274
|
|
|
|
|
59
|
|
|
|
|
0
|
|
|
|
|
333
|
|
|
||||
Banks/financial institutions
|
|
2,841
|
|
|
|
|
457
|
|
|
|
|
34
|
|
|
|
|
3,264
|
|
|
||||
Other corporate
|
|
25,936
|
|
|
|
|
1,736
|
|
|
|
|
1,111
|
|
|
|
|
26,561
|
|
|
||||
Total U.S. dollar-denominated
|
|
35,453
|
|
|
|
|
3,034
|
|
|
|
|
1,254
|
|
|
|
|
37,233
|
|
|
||||
Total securities available for sale
|
|
$
|
81,607
|
|
(1)
|
|
|
$
|
8,998
|
|
|
|
|
$
|
1,572
|
|
|
|
|
$
|
89,033
|
|
(1)
|
|
March 31, 2018
|
||||||||||||||||||||||
(In millions)
|
Cost or
Amortized Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||||||||||
Securities held to maturity, carried at amortized cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Yen-denominated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Japan government and agencies
|
|
$
|
22,686
|
|
|
|
|
$
|
5,631
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
28,317
|
|
|
Municipalities
|
|
379
|
|
|
|
|
114
|
|
|
|
|
0
|
|
|
|
|
493
|
|
|
||||
Mortgage- and asset-backed securities
|
|
26
|
|
|
|
|
2
|
|
|
|
|
0
|
|
|
|
|
28
|
|
|
||||
Public utilities
|
|
3,508
|
|
|
|
|
383
|
|
|
|
|
0
|
|
|
|
|
3,891
|
|
|
||||
Sovereign and supranational
|
|
1,620
|
|
|
|
|
299
|
|
|
|
|
0
|
|
|
|
|
1,919
|
|
|
||||
Banks/financial institutions
|
|
2,300
|
|
|
|
|
190
|
|
|
|
|
13
|
|
|
|
|
2,477
|
|
|
||||
Other corporate
|
|
2,858
|
|
|
|
|
485
|
|
|
|
|
0
|
|
|
|
|
3,343
|
|
|
||||
Total yen-denominated
|
|
33,377
|
|
|
|
|
7,104
|
|
|
|
|
13
|
|
|
|
|
40,468
|
|
|
||||
Total securities held to maturity
|
|
$
|
33,377
|
|
|
|
|
$
|
7,104
|
|
|
|
|
$
|
13
|
|
|
|
|
$
|
40,468
|
|
|
|
March 31, 2018
|
||||||||||||||||
(In millions)
|
|
|
|
|
|
|
Fair
Value |
||||||||||
Equity securities, carried at fair value through
net earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Equity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Yen-denominated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
711
|
|
|
U.S. dollar-denominated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
397
|
|
|
|
Total equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,108
|
|
(1)
|
|
December 31, 2017
|
||||||||||||||||||||||
(In millions)
|
Cost or
Amortized Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||||||||||
Securities available for sale, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Yen-denominated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Japan government and agencies
|
|
$
|
27,980
|
|
|
|
|
$
|
3,363
|
|
|
|
|
$
|
271
|
|
|
|
|
$
|
31,072
|
|
|
Municipalities
|
|
314
|
|
|
|
|
28
|
|
|
|
|
12
|
|
|
|
|
330
|
|
|
||||
Mortgage- and asset-backed securities
|
|
242
|
|
|
|
|
29
|
|
|
|
|
0
|
|
|
|
|
271
|
|
|
||||
Public utilities
|
|
1,635
|
|
|
|
|
352
|
|
|
|
|
6
|
|
|
|
|
1,981
|
|
|
||||
Sovereign and supranational
|
|
1,380
|
|
|
|
|
190
|
|
|
|
|
1
|
|
|
|
|
1,569
|
|
|
||||
Banks/financial institutions
|
|
4,742
|
|
|
|
|
811
|
|
|
|
|
53
|
|
|
|
|
5,500
|
|
|
||||
Other corporate
|
|
4,085
|
|
|
|
|
809
|
|
|
|
|
7
|
|
|
|
|
4,887
|
|
|
||||
Total yen-denominated
|
|
40,378
|
|
|
|
|
5,582
|
|
|
|
|
350
|
|
|
|
|
45,610
|
|
|
||||
U.S dollar-denominated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
|
146
|
|
|
|
|
13
|
|
|
|
|
1
|
|
|
|
|
158
|
|
|
||||
Municipalities
|
|
872
|
|
|
|
|
168
|
|
|
|
|
0
|
|
|
|
|
1,040
|
|
|
||||
Mortgage- and asset-backed securities
|
|
161
|
|
|
|
|
12
|
|
|
|
|
0
|
|
|
|
|
173
|
|
|
||||
Public utilities
|
|
5,116
|
|
|
|
|
884
|
|
|
|
|
27
|
|
|
|
|
5,973
|
|
|
||||
Sovereign and supranational
|
|
267
|
|
|
|
|
73
|
|
|
|
|
0
|
|
|
|
|
340
|
|
|
||||
Banks/financial institutions
|
|
2,808
|
|
|
|
|
633
|
|
|
|
|
8
|
|
|
|
|
3,433
|
|
|
||||
Other corporate
|
|
25,384
|
|
|
|
|
2,620
|
|
|
|
|
418
|
|
|
|
|
27,586
|
|
|
||||
Total U.S. dollar-denominated
|
|
34,754
|
|
|
|
|
4,403
|
|
|
|
|
454
|
|
|
|
|
38,703
|
|
|
||||
Total securities available for sale
|
|
$
|
75,132
|
|
(1)
|
|
|
$
|
9,985
|
|
|
|
|
$
|
804
|
|
|
|
|
$
|
84,313
|
|
(1)
|
|
December 31, 2017
|
||||||||||||||||||||||
(In millions)
|
Cost or
Amortized Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||||||||||
Securities held to maturity, carried at amortized cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Yen-denominated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Japan government and agencies
|
|
$
|
21,331
|
|
|
|
|
$
|
5,160
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
26,491
|
|
|
Municipalities
|
|
357
|
|
|
|
|
105
|
|
|
|
|
0
|
|
|
|
|
462
|
|
|
||||
Mortgage- and asset-backed securities
|
|
26
|
|
|
|
|
1
|
|
|
|
|
0
|
|
|
|
|
27
|
|
|
||||
Public utilities
|
|
3,300
|
|
|
|
|
398
|
|
|
|
|
0
|
|
|
|
|
3,698
|
|
|
||||
Sovereign and supranational
|
|
1,523
|
|
|
|
|
312
|
|
|
|
|
0
|
|
|
|
|
1,835
|
|
|
||||
Banks/financial institutions
|
|
2,206
|
|
|
|
|
190
|
|
|
|
|
9
|
|
|
|
|
2,387
|
|
|
||||
Other corporate
|
|
2,687
|
|
|
|
|
485
|
|
|
|
|
0
|
|
|
|
|
3,172
|
|
|
||||
Total yen-denominated
|
|
31,430
|
|
|
|
|
6,651
|
|
|
|
|
9
|
|
|
|
|
38,072
|
|
|
||||
Total securities held to maturity
|
|
$
|
31,430
|
|
|
|
|
$
|
6,651
|
|
|
|
|
$
|
9
|
|
|
|
|
$
|
38,072
|
|
|
|
December 31, 2017
|
||||||||||||||||
(In millions)
|
|
|
|
|
|
|
Fair
Value |
||||||||||
Equity securities, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Equity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Yen-denominated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
695
|
|
|
U.S. dollar-denominated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
328
|
|
|
|
Total equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,023
|
|
|
(In millions)
|
Amortized
Cost |
|
Fair
Value |
|
||||||||
Available for sale:
(1)
|
|
|
|
|
|
|
|
|
||||
Due in one year or less
|
|
$
|
485
|
|
|
|
|
$
|
502
|
|
|
|
Due after one year through five years
|
|
9,685
|
|
|
|
|
9,551
|
|
|
|
||
Due after five years through 10 years
|
|
10,637
|
|
|
|
|
11,143
|
|
|
|
||
Due after 10 years
|
|
60,381
|
|
|
|
|
67,382
|
|
|
|
||
Mortgage- and asset-backed securities
|
|
419
|
|
|
|
|
455
|
|
|
|
||
Total fixed maturity securities available for sale
|
|
$
|
81,607
|
|
|
|
|
$
|
89,033
|
|
|
|
Held to maturity:
|
|
|
|
|
|
|
|
|
||||
Due in one year or less
|
|
$
|
1,036
|
|
|
|
|
$
|
1,049
|
|
|
|
Due after one year through five years
|
|
508
|
|
|
|
|
527
|
|
|
|
||
Due after five years through 10 years
|
|
1,597
|
|
|
|
|
1,754
|
|
|
|
||
Due after 10 years
|
|
30,210
|
|
|
|
|
37,110
|
|
|
|
||
Mortgage- and asset-backed securities
|
|
26
|
|
|
|
|
28
|
|
|
|
||
Total fixed maturity securities held to maturity
|
|
$
|
33,377
|
|
|
|
|
$
|
40,468
|
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||
(In millions)
|
Credit
Rating |
|
Amortized
Cost |
|
Fair
Value |
|
Credit
Rating |
|
Amortized
Cost |
|
Fair
Value |
Japan National Government
(1)
|
A
|
|
$54,465
|
|
$63,576
|
|
A
|
|
$48,399
|
|
$56,532
|
|
Three Months Ended
March 31, |
|
||||||
(In millions)
|
2018
|
|
2017
|
|
||||
Realized investment gains (losses):
|
|
|
|
|
||||
Fixed maturity securities:
(1)
|
|
|
|
|
||||
Available for sale:
|
|
|
|
|
||||
Gross gains from sales
|
$
|
9
|
|
|
$
|
12
|
|
|
Gross losses from sales
|
(4
|
)
|
|
(15
|
)
|
|
||
Net gains (losses) from redemptions
|
(2
|
)
|
|
(28
|
)
|
|
||
Other-than-temporary impairment losses
|
0
|
|
|
(4
|
)
|
|
||
Total fixed maturity securities
|
3
|
|
|
(35
|
)
|
|
||
Equity securities
(2)
|
(46
|
)
|
(1)
|
19
|
|
(3)
|
||
Loan loss reserves
|
(7
|
)
|
|
(1
|
)
|
|
||
Derivatives and other:
|
|
|
|
|
||||
Derivative gains (losses)
|
144
|
|
|
(52
|
)
|
|
||
Foreign currency gains (losses)
|
(228
|
)
|
|
(71
|
)
|
|
||
Total derivatives and other
|
(84
|
)
|
|
(123
|
)
|
|
||
Total realized investment gains (losses)
|
$
|
(134
|
)
|
|
$
|
(140
|
)
|
|
(In millions)
|
March 31, 2018
|
|
December 31,
2017 |
||||||||
Unrealized gains (losses) on securities available for sale
|
|
$
|
7,426
|
|
|
|
|
$
|
9,358
|
|
|
Deferred income taxes
|
|
(2,220
|
)
|
|
|
|
(3,394
|
)
|
|
||
Shareholders’ equity, unrealized gains (losses) on investment securities
|
|
$
|
5,206
|
|
|
|
|
$
|
5,964
|
|
|
|
March 31, 2018
|
||||||||||||||||||||||||||||||||||
|
Total
|
|
Less than 12 months
|
|
12 months or longer
|
||||||||||||||||||||||||||||||
(In millions)
|
Fair
Value |
|
Unrealized
Losses |
|
Fair
Value |
|
Unrealized
Losses |
|
Fair
Value |
|
Unrealized
Losses |
||||||||||||||||||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government and
agencies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
$
|
79
|
|
|
|
|
$
|
1
|
|
|
|
|
$
|
71
|
|
|
|
|
$
|
1
|
|
|
|
|
$
|
8
|
|
|
|
|
$
|
0
|
|
|
Japan government and
agencies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Yen-denominated
|
|
4,054
|
|
|
|
|
192
|
|
|
|
|
128
|
|
|
|
|
0
|
|
|
|
|
3,926
|
|
|
|
|
192
|
|
|
||||||
Municipalities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Yen-denominated
|
|
128
|
|
|
|
|
11
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
128
|
|
|
|
|
11
|
|
|
||||||
Mortgage- and asset-
backed securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
91
|
|
|
|
|
1
|
|
|
|
|
71
|
|
|
|
|
1
|
|
|
|
|
20
|
|
|
|
|
0
|
|
|
||||||
Public utilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
1,649
|
|
|
|
|
107
|
|
|
|
|
1,095
|
|
|
|
|
52
|
|
|
|
|
554
|
|
|
|
|
55
|
|
|
||||||
Yen-denominated
|
|
90
|
|
|
|
|
4
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
90
|
|
|
|
|
4
|
|
|
||||||
Sovereign and supranational:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Yen-denominated
|
|
302
|
|
|
|
|
27
|
|
|
|
|
302
|
|
|
|
|
27
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||||
Banks/financial institutions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
685
|
|
|
|
|
34
|
|
|
|
|
596
|
|
|
|
|
28
|
|
|
|
|
89
|
|
|
|
|
6
|
|
|
||||||
Yen-denominated
|
|
1,467
|
|
|
|
|
89
|
|
|
|
|
645
|
|
|
|
|
14
|
|
|
|
|
822
|
|
|
|
|
75
|
|
|
||||||
Other corporate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
13,730
|
|
|
|
|
1,111
|
|
|
|
|
8,903
|
|
|
|
|
420
|
|
|
|
|
4,827
|
|
|
|
|
691
|
|
|
||||||
Yen-denominated
|
|
302
|
|
|
|
|
8
|
|
|
|
|
276
|
|
|
|
|
6
|
|
|
|
|
26
|
|
|
|
|
2
|
|
|
||||||
Total
|
|
$
|
22,577
|
|
|
|
|
$
|
1,585
|
|
|
|
|
$
|
12,087
|
|
|
|
|
$
|
549
|
|
|
|
|
$
|
10,490
|
|
|
|
|
$
|
1,036
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||||||||||||||
|
Total
|
|
Less than 12 months
|
|
12 months or longer
|
||||||||||||||||||||||||||||||
(In millions)
|
Fair
Value |
|
Unrealized
Losses |
|
Fair
Value |
|
Unrealized
Losses |
|
Fair
Value |
|
Unrealized
Losses |
||||||||||||||||||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government and
agencies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
$
|
74
|
|
|
|
|
$
|
1
|
|
|
|
|
$
|
74
|
|
|
|
|
$
|
1
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
Japan government and
agencies: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Yen-denominated
|
|
5,255
|
|
|
|
|
271
|
|
|
|
|
1,264
|
|
|
|
|
9
|
|
|
|
|
3,991
|
|
|
|
|
262
|
|
|
||||||
Municipalities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Yen-denominated
|
|
129
|
|
|
|
|
12
|
|
|
|
|
10
|
|
|
|
|
0
|
|
|
|
|
119
|
|
|
|
|
12
|
|
|
||||||
Public utilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
785
|
|
|
|
|
27
|
|
|
|
|
221
|
|
|
|
|
3
|
|
|
|
|
564
|
|
|
|
|
24
|
|
|
||||||
Yen-denominated
|
|
83
|
|
|
|
|
6
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
83
|
|
|
|
|
6
|
|
|
||||||
Sovereign and supranational:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Yen-denominated
|
|
309
|
|
|
|
|
1
|
|
|
|
|
309
|
|
|
|
|
1
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||||
Banks/financial institutions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
362
|
|
|
|
|
8
|
|
|
|
|
316
|
|
|
|
|
5
|
|
|
|
|
46
|
|
|
|
|
3
|
|
|
||||||
Yen-denominated
|
|
1,507
|
|
|
|
|
62
|
|
|
|
|
394
|
|
|
|
|
4
|
|
|
|
|
1,113
|
|
|
|
|
58
|
|
|
||||||
Other corporate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar-denominated
|
|
7,741
|
|
|
|
|
418
|
|
|
|
|
2,839
|
|
|
|
|
50
|
|
|
|
|
4,902
|
|
|
|
|
368
|
|
|
||||||
Yen-denominated
|
|
440
|
|
|
|
|
7
|
|
|
|
|
349
|
|
|
|
|
4
|
|
|
|
|
91
|
|
|
|
|
3
|
|
|
||||||
Total
|
|
$
|
16,685
|
|
|
|
|
$
|
813
|
|
|
|
|
$
|
5,776
|
|
|
|
|
$
|
77
|
|
|
|
|
$
|
10,909
|
|
|
|
|
$
|
736
|
|
|
(In millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||||||
Other investments:
|
|
|
|
|
|
|
|
||||
Transitional real estate loans
|
|
$
|
2,719
|
|
|
|
|
$
|
1,235
|
|
|
Commercial mortgage loans
|
|
917
|
|
|
|
|
908
|
|
|
||
Middle market loans
|
|
957
|
|
|
|
|
859
|
|
|
||
Policy loans
|
|
227
|
|
|
|
|
210
|
|
|
||
Short-term investments
|
|
0
|
|
|
|
|
57
|
|
|
||
Other
|
|
253
|
|
|
|
|
133
|
|
|
||
Total other investments
|
|
$
|
5,073
|
|
|
|
|
$
|
3,402
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
(In millions)
|
Cost or Amortized
Cost |
|
Fair
Value |
|
Cost or Amortized
Cost |
|
Fair
Value |
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities, available for sale
(1)
|
|
$
|
4,695
|
|
|
|
|
$
|
5,431
|
|
|
|
|
$
|
4,538
|
|
|
|
|
$
|
5,509
|
|
|
Equity securities
|
|
760
|
|
|
|
|
760
|
|
|
|
|
606
|
|
|
|
|
753
|
|
|
||||
Other investments
(2)
|
|
3,994
|
|
|
|
|
3,974
|
|
|
|
|
2,341
|
|
|
|
|
2,328
|
|
|
||||
Other assets
(3)
|
|
241
|
|
|
|
|
241
|
|
|
|
|
151
|
|
|
|
|
151
|
|
|
||||
Total assets of consolidated VIEs
|
|
$
|
9,690
|
|
|
|
|
$
|
10,406
|
|
|
|
|
$
|
7,636
|
|
|
|
|
$
|
8,741
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other liabilities
(3)
|
|
$
|
86
|
|
|
|
|
$
|
86
|
|
|
|
|
$
|
128
|
|
|
|
|
$
|
128
|
|
|
Total liabilities of consolidated VIEs
|
|
$
|
86
|
|
|
|
|
$
|
86
|
|
|
|
|
$
|
128
|
|
|
|
|
$
|
128
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
(In millions)
|
Amortized
Cost |
|
Fair
Value |
|
Amortized
Cost |
|
Fair
Value |
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities, available for sale
(1)
|
|
$
|
5,194
|
|
|
|
|
$
|
5,749
|
|
|
|
|
$
|
5,004
|
|
|
|
|
$
|
5,724
|
|
|
Fixed maturity securities, held to maturity
|
|
2,711
|
|
|
|
|
3,077
|
|
|
|
|
2,549
|
|
|
|
|
2,929
|
|
|
||||
Other investments
|
|
110
|
|
|
|
|
108
|
|
|
|
|
55
|
|
|
|
|
55
|
|
|
||||
Total investments in VIEs not consolidated
|
|
$
|
8,015
|
|
|
|
|
$
|
8,934
|
|
|
|
|
$
|
7,608
|
|
|
|
|
$
|
8,708
|
|
|
Securities Lending Transactions Accounted for as Secured Borrowings
|
||||||||||||
December 31, 2017
|
||||||||||||
Remaining Contractual Maturity of the Agreements
|
||||||||||||
(In millions)
|
Overnight
and Continuous (1) |
|
Up to 30
days |
|
|
Total
|
||||||
Securities lending transactions:
|
|
|
|
|
|
|
||||||
Fixed maturity securities:
|
|
|
|
|
|
|
||||||
Japan government and agencies
|
$
|
0
|
|
|
$
|
49
|
|
|
|
$
|
49
|
|
Public utilities
|
73
|
|
|
0
|
|
|
|
73
|
|
|||
Banks/financial institutions
|
54
|
|
|
0
|
|
|
|
54
|
|
|||
Other corporate
|
415
|
|
|
0
|
|
|
|
415
|
|
|||
Equity securities
|
15
|
|
|
0
|
|
|
|
15
|
|
|||
Total borrowings
|
$
|
557
|
|
|
$
|
49
|
|
|
|
$
|
606
|
|
Gross amount of recognized liabilities for securities lending transactions
|
|
$
|
606
|
|
||||||||
Amounts related to agreements not included in offsetting disclosure in Note 4
|
|
$
|
0
|
|
4.
|
DERIVATIVE INSTRUMENTS
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
||||||||||||||||||||||||||||
(In millions)
|
|
|
Asset
Derivatives |
|
Liability
Derivatives |
|
|
Asset
Derivatives |
|
Liability
Derivatives |
|
||||||||||||||||||||||||
Hedge Designation/ Derivative
Type |
Notional
Amount |
|
Fair Value
|
|
Fair Value
|
Notional
Amount |
|
Fair Value
|
|
Fair Value
|
|
||||||||||||||||||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency swaps
|
|
$
|
75
|
|
|
|
|
$
|
1
|
|
|
|
|
$
|
(2
|
)
|
|
|
$
|
75
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
(8
|
)
|
|
|
Total cash flow hedges
|
|
75
|
|
|
|
|
1
|
|
|
|
|
(2
|
)
|
|
|
75
|
|
|
|
|
0
|
|
|
|
|
(8
|
)
|
|
|
||||||
Fair value hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency forwards
|
|
5,550
|
|
|
|
|
244
|
|
|
|
|
(5
|
)
|
|
|
7,640
|
|
|
|
|
2
|
|
|
|
|
(221
|
)
|
|
|
||||||
Foreign currency options
|
|
9,120
|
|
|
|
|
0
|
|
|
|
|
(3
|
)
|
|
|
7,670
|
|
|
|
|
0
|
|
|
|
|
(2
|
)
|
|
|
||||||
Total fair value hedges
|
|
14,670
|
|
|
|
|
244
|
|
|
|
|
(8
|
)
|
|
|
15,310
|
|
|
|
|
2
|
|
|
|
|
(223
|
)
|
|
|
||||||
Net investment hedge:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency forwards
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
5
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
||||||
Foreign currency options
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
434
|
|
|
|
|
12
|
|
|
|
|
(1
|
)
|
|
|
||||||
Total net investment hedge
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
439
|
|
|
|
|
12
|
|
|
|
|
(1
|
)
|
|
|
||||||
Non-qualifying strategies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency swaps
|
|
5,426
|
|
|
|
|
369
|
|
|
|
|
(263
|
)
|
|
|
5,386
|
|
|
|
|
296
|
|
|
|
|
(189
|
)
|
|
|
||||||
Foreign currency forwards
|
|
6,656
|
|
|
|
|
182
|
|
|
|
|
(80
|
)
|
|
|
3,683
|
|
|
|
|
20
|
|
|
|
|
(53
|
)
|
|
|
||||||
Foreign currency options
|
|
299
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
770
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
||||||
Credit default swaps
|
|
94
|
|
|
|
|
1
|
|
|
|
|
0
|
|
|
|
88
|
|
|
|
|
1
|
|
|
|
|
0
|
|
|
|
||||||
Total non-qualifying strategies
|
|
12,475
|
|
|
|
|
552
|
|
|
|
|
(343
|
)
|
|
|
9,927
|
|
|
|
|
317
|
|
|
|
|
(242
|
)
|
|
|
||||||
Total derivatives
|
|
$
|
27,220
|
|
|
|
|
$
|
797
|
|
|
|
|
$
|
(353
|
)
|
|
|
$
|
25,751
|
|
|
|
|
$
|
331
|
|
|
|
|
$
|
(474
|
)
|
|
|
Balance Sheet Location
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other assets
|
|
$
|
18,248
|
|
|
|
|
$
|
797
|
|
|
|
|
$
|
0
|
|
|
|
$
|
10,948
|
|
|
|
|
$
|
331
|
|
|
|
|
$
|
0
|
|
|
|
Other liabilities
|
|
8,972
|
|
|
|
|
0
|
|
|
|
|
(353
|
)
|
|
|
14,803
|
|
|
|
|
0
|
|
|
|
|
(474
|
)
|
|
|
||||||
Total derivatives
|
|
$
|
27,220
|
|
|
|
|
$
|
797
|
|
|
|
|
$
|
(353
|
)
|
|
|
$
|
25,751
|
|
|
|
|
$
|
331
|
|
|
|
|
$
|
(474
|
)
|
|
|
(In millions)
|
|
|
Hedging Derivatives
|
|
Hedged Items
|
|
|
||||||||||||||
Hedging Derivatives
|
Hedged Items
|
|
Total
Gains (Losses) |
|
Gains (Losses)
Excluded from Effectiveness Testing |
|
Gains (Losses)
Included in Effectiveness Testing |
|
Gains (Losses)
|
|
Ineffectiveness
Recognized for Fair Value Hedge |
||||||||||
Three Months Ended March 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Foreign currency
forwards |
Fixed maturity securities
|
|
$
|
414
|
|
|
$
|
(39
|
)
|
|
$
|
453
|
|
|
$
|
(464
|
)
|
|
$
|
(11
|
)
|
Foreign currency
options |
Fixed maturity securities
|
|
(1
|
)
|
|
(1
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||
Three Months Ended March 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Foreign currency forwards
|
Fixed maturity and equity securities
|
|
$
|
341
|
|
|
$
|
(48
|
)
|
|
$
|
389
|
|
|
$
|
(372
|
)
|
|
$
|
17
|
|
Foreign currency options
|
Fixed maturity securities
|
|
24
|
|
|
13
|
|
|
11
|
|
|
(10
|
)
|
|
1
|
|
|
Three Months Ended March 31,
|
|||||||||||||||||||
|
2018
|
2017
|
||||||||||||||||||
(In millions)
|
Realized Investment
Gains (Losses) |
Other
Comprehensive Income (Loss) (1) |
Realized Investment
Gains (Losses) |
Other
Comprehensive Income (Loss) (1) |
||||||||||||||||
Qualifying hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency swaps
|
|
$
|
1
|
|
|
|
$
|
6
|
|
|
|
$
|
0
|
|
|
|
$
|
2
|
|
|
Total cash flow hedges
|
|
1
|
|
|
|
6
|
|
|
|
0
|
|
|
|
2
|
|
|
||||
Fair value hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forwards
(2)
|
|
(50
|
)
|
|
|
0
|
|
|
|
(31
|
)
|
|
|
0
|
|
|
||||
Foreign currency options
(2)
|
|
(1
|
)
|
|
|
0
|
|
|
|
14
|
|
|
|
0
|
|
|
||||
Total fair value hedges
|
|
(51
|
)
|
|
|
0
|
|
|
|
(17
|
)
|
|
|
0
|
|
|
||||
Net investment hedge:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Non-derivative hedging instruments
|
|
0
|
|
|
|
(84
|
)
|
|
|
0
|
|
|
|
(17
|
)
|
|
||||
Foreign currency forwards
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(9
|
)
|
|
||||
Foreign currency options
|
|
0
|
|
|
|
(8
|
)
|
|
|
0
|
|
|
|
(23
|
)
|
|
||||
Total net investment hedge
|
|
0
|
|
|
|
(92
|
)
|
|
|
0
|
|
|
|
(49
|
)
|
|
||||
Non-qualifying strategies:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency swaps
|
|
14
|
|
|
|
0
|
|
|
|
(8
|
)
|
|
|
0
|
|
|
||||
Foreign currency forwards
|
|
179
|
|
|
|
0
|
|
|
|
(27
|
)
|
|
|
0
|
|
|
||||
Foreign currency options
|
|
1
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
||||
Total non-qualifying strategies
|
|
194
|
|
|
|
0
|
|
|
|
(35
|
)
|
|
|
0
|
|
|
||||
Total
|
|
$
|
144
|
|
|
|
$
|
(86
|
)
|
|
|
$
|
(52
|
)
|
|
|
$
|
(47
|
)
|
|
|
March 31, 2018
|
December 31, 2017
|
||||||||||||||||||||||||||||
(In millions)
|
Notional Amount
of Derivatives |
Asset Derivatives
Fair Value |
Liability Derivatives
Fair Value |
Notional Amount
of Derivatives |
Asset Derivatives
Fair Value |
Liability Derivatives
Fair Value |
||||||||||||||||||||||||
Counterparties' credit rating:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
AA
|
|
$
|
4,685
|
|
|
|
$
|
123
|
|
|
|
$
|
(12
|
)
|
|
|
$
|
4,708
|
|
|
|
$
|
52
|
|
|
|
$
|
(37
|
)
|
|
A
|
|
22,081
|
|
|
|
673
|
|
|
|
(290
|
)
|
|
|
20,604
|
|
|
|
271
|
|
|
|
(370
|
)
|
|
||||||
BBB
|
|
454
|
|
|
|
1
|
|
|
|
(51
|
)
|
|
|
439
|
|
|
|
8
|
|
|
|
(67
|
)
|
|
||||||
Total
|
|
$
|
27,220
|
|
|
|
$
|
797
|
|
|
|
$
|
(353
|
)
|
|
|
$
|
25,751
|
|
|
|
$
|
331
|
|
|
|
$
|
(474
|
)
|
|
March 31, 2018
|
|||||||||||||||||||||||||||||||||||||||
|
|
|
Gross Amounts Not Offset
in Balance Sheet |
|
|
||||||||||||||||||||||||||||||||||
(In millions)
|
Gross Amount of Recognized Assets
|
|
Gross Amount
Offset in
Balance Sheet
|
|
Net Amount of Assets Presented
in Balance Sheet
|
|
Financial Instruments
|
|
Securities
Collateral
|
|
Cash Collateral Received
|
|
Net Amount
|
||||||||||||||||||||||||||
Derivative
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Derivative
assets subject to a
master netting
agreement or
offsetting
arrangement
|
|
$
|
556
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
556
|
|
|
|
|
$
|
(116
|
)
|
|
|
$
|
(343
|
)
|
|
|
$
|
(67
|
)
|
|
|
|
$
|
30
|
|
|
Derivative
assets not subject
to a master netting
agreement or
offsetting
arrangement
|
|
241
|
|
|
|
|
|
|
|
|
241
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
241
|
|
|
|||||||||||
Total derivative
assets
|
|
797
|
|
|
|
|
0
|
|
|
|
|
797
|
|
|
|
|
(116
|
)
|
|
|
(343
|
)
|
|
|
(67
|
)
|
|
|
|
271
|
|
|
|||||||
Securities lending
and similar
arrangements
|
|
5,249
|
|
|
|
|
0
|
|
|
|
|
5,249
|
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(5,249
|
)
|
|
|
|
0
|
|
|
|||||||
Total
|
|
$
|
6,046
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
6,046
|
|
|
|
|
$
|
(116
|
)
|
|
|
$
|
(343
|
)
|
|
|
$
|
(5,316
|
)
|
|
|
|
$
|
271
|
|
|
December 31, 2017
|
|||||||||||||||||||||||||||||||||||||||
|
|
|
Gross Amounts Not Offset
in Balance Sheet |
|
|
||||||||||||||||||||||||||||||||||
(In millions)
|
Gross Amount of Recognized Assets
|
|
Gross Amount
Offset in
Balance Sheet
|
|
Net Amount of Assets Presented
in Balance Sheet
|
|
Financial Instruments
|
|
Securities
Collateral
|
|
Cash Collateral Received
|
|
Net Amount
|
||||||||||||||||||||||||||
Derivative
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Derivative
assets subject to a
master netting
agreement or
offsetting
arrangement
|
|
$
|
180
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
180
|
|
|
|
|
$
|
(82
|
)
|
|
|
$
|
0
|
|
|
|
$
|
(98
|
)
|
|
|
|
$
|
0
|
|
|
Derivative
assets not subject
to a master netting
agreement or
offsetting
arrangement
|
|
151
|
|
|
|
|
|
|
|
|
151
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
151
|
|
|
|||||||||||
Total derivative
assets
|
|
331
|
|
|
|
|
0
|
|
|
|
|
331
|
|
|
|
|
(82
|
)
|
|
|
0
|
|
|
|
(98
|
)
|
|
|
|
151
|
|
|
|||||||
Securities lending
and similar
arrangements
|
|
592
|
|
|
|
|
0
|
|
|
|
|
592
|
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(592
|
)
|
|
|
|
0
|
|
|
|||||||
Total
|
|
$
|
923
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
923
|
|
|
|
|
$
|
(82
|
)
|
|
|
$
|
0
|
|
|
|
$
|
(690
|
)
|
|
|
|
$
|
151
|
|
|
March 31, 2018
|
|||||||||||||||||||||||||||||||||||||||
|
|
|
Gross Amounts Not Offset
in Balance Sheet |
|
|
||||||||||||||||||||||||||||||||||
(In millions)
|
Gross Amount of Recognized Liabilities
|
|
Gross Amount
Offset in
Balance Sheet
|
|
Net Amount of Liabilities Presented
in Balance Sheet
|
|
Financial Instruments
|
|
Securities
Collateral
|
|
Cash Collateral Pledged
|
|
Net Amount
|
||||||||||||||||||||||||||
Derivative
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Derivative
liabilities subject
to a master netting
agreement or
offsetting
arrangement
|
|
$
|
(267
|
)
|
|
|
|
$
|
0
|
|
|
|
|
$
|
(267
|
)
|
|
|
|
$
|
116
|
|
|
|
$
|
36
|
|
|
|
$
|
113
|
|
|
|
|
$
|
(2
|
)
|
|
Derivative
liabilities not
subject to a
master netting
agreement or
offsetting
arrangement
|
|
(86
|
)
|
|
|
|
|
|
|
|
(86
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(86
|
)
|
|
|||||||||||
Total derivative
liabilities
|
|
(353
|
)
|
|
|
|
0
|
|
|
|
|
(353
|
)
|
|
|
|
116
|
|
|
|
36
|
|
|
|
113
|
|
|
|
|
(88
|
)
|
|
|||||||
Securities lending
and similar
arrangements
|
|
(5,368
|
)
|
|
|
|
0
|
|
|
|
|
(5,368
|
)
|
|
|
|
5,249
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
(119
|
)
|
|
|||||||
Total
|
|
$
|
(5,721
|
)
|
|
|
|
$
|
0
|
|
|
|
|
$
|
(5,721
|
)
|
|
|
|
$
|
5,365
|
|
|
|
$
|
36
|
|
|
|
$
|
113
|
|
|
|
|
$
|
(207
|
)
|
|
December 31, 2017
|
|||||||||||||||||||||||||||||||||||||||
|
|
|
Gross Amounts Not Offset
in Balance Sheet |
|
|
||||||||||||||||||||||||||||||||||
(In millions)
|
Gross Amount of Recognized Liabilities
|
|
Gross Amount
Offset in
Balance Sheet
|
|
Net Amount of Liabilities Presented
in Balance Sheet
|
|
Financial Instruments
|
|
Securities
Collateral
|
|
Cash Collateral Pledged
|
|
Net Amount
|
||||||||||||||||||||||||||
Derivative
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Derivative
liabilities subject
to a master netting
agreement or
offsetting
arrangement
|
|
$
|
(346
|
)
|
|
|
|
$
|
0
|
|
|
|
|
$
|
(346
|
)
|
|
|
|
$
|
82
|
|
|
|
$
|
245
|
|
|
|
$
|
10
|
|
|
|
|
$
|
(9
|
)
|
|
Derivative
liabilities not
subject to a
master netting
agreement or
offsetting
arrangement
|
|
(128
|
)
|
|
|
|
|
|
|
|
(128
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(128
|
)
|
|
|||||||||||
Total derivative
liabilities
|
|
(474
|
)
|
|
|
|
0
|
|
|
|
|
(474
|
)
|
|
|
|
82
|
|
|
|
245
|
|
|
|
10
|
|
|
|
|
(137
|
)
|
|
|||||||
Securities lending
and similar
arrangements
|
|
(606
|
)
|
|
|
|
0
|
|
|
|
|
(606
|
)
|
|
|
|
592
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
(14
|
)
|
|
|||||||
Total
|
|
$
|
(1,080
|
)
|
|
|
|
$
|
0
|
|
|
|
|
$
|
(1,080
|
)
|
|
|
|
$
|
674
|
|
|
|
$
|
245
|
|
|
|
$
|
10
|
|
|
|
|
$
|
(151
|
)
|
|
5.
|
FAIR VALUE MEASUREMENTS
|
|
March 31, 2018
|
||||||||||||||||||||||
(In millions)
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Fair Value |
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Securities available for sale, carried at
fair value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Government and agencies
|
|
$
|
35,325
|
|
|
|
|
$
|
1,411
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
36,736
|
|
|
Municipalities
|
|
0
|
|
|
|
|
1,373
|
|
|
|
|
0
|
|
|
|
|
1,373
|
|
|
||||
Mortgage- and asset-backed securities
|
|
0
|
|
|
|
|
269
|
|
|
|
|
186
|
|
|
|
|
455
|
|
|
||||
Public utilities
|
|
0
|
|
|
|
|
7,724
|
|
|
|
|
83
|
|
|
|
|
7,807
|
|
|
||||
Sovereign and supranational
|
|
0
|
|
|
|
|
1,866
|
|
|
|
|
0
|
|
|
|
|
1,866
|
|
|
||||
Banks/financial institutions
|
|
0
|
|
|
|
|
9,120
|
|
|
|
|
24
|
|
|
|
|
9,144
|
|
|
||||
Other corporate
|
|
0
|
|
|
|
|
31,509
|
|
|
|
|
143
|
|
|
|
|
31,652
|
|
|
||||
Total fixed maturity securities
|
|
35,325
|
|
|
|
|
53,272
|
|
|
|
|
436
|
|
|
|
|
89,033
|
|
(1)
|
||||
Equity securities
(1)
|
|
1,015
|
|
|
|
|
77
|
|
|
|
|
16
|
|
|
|
|
1,108
|
|
(1)
|
||||
Cash and cash equivalents
|
|
4,080
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
4,080
|
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency swaps
|
|
0
|
|
|
|
|
130
|
|
|
|
|
240
|
|
|
|
|
370
|
|
|
||||
Foreign currency forwards
|
|
0
|
|
|
|
|
426
|
|
|
|
|
0
|
|
|
|
|
426
|
|
|
||||
Credit default swaps
|
|
0
|
|
|
|
|
0
|
|
|
|
|
1
|
|
|
|
|
1
|
|
|
||||
Total other assets
|
|
0
|
|
|
|
|
556
|
|
|
|
|
241
|
|
|
|
|
797
|
|
|
||||
Total assets
|
|
$
|
40,420
|
|
|
|
|
$
|
53,905
|
|
|
|
|
$
|
693
|
|
|
|
|
$
|
95,018
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency swaps
|
|
$
|
0
|
|
|
|
|
$
|
179
|
|
|
|
|
$
|
86
|
|
|
|
|
$
|
265
|
|
|
Foreign currency forwards
|
|
0
|
|
|
|
|
85
|
|
|
|
|
0
|
|
|
|
|
85
|
|
|
||||
Foreign currency options
|
|
0
|
|
|
|
|
3
|
|
|
|
|
0
|
|
|
|
|
3
|
|
|
||||
Total liabilities
|
|
$
|
0
|
|
|
|
|
$
|
267
|
|
|
|
|
$
|
86
|
|
|
|
|
$
|
353
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
(In millions)
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Fair Value |
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Securities available for sale, carried at
fair value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Government and agencies
|
|
$
|
30,109
|
|
|
|
|
$
|
1,121
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
31,230
|
|
|
Municipalities
|
|
0
|
|
|
|
|
1,370
|
|
|
|
|
0
|
|
|
|
|
1,370
|
|
|
||||
Mortgage- and asset-backed securities
|
|
0
|
|
|
|
|
269
|
|
|
|
|
175
|
|
|
|
|
444
|
|
|
||||
Public utilities
|
|
0
|
|
|
|
|
7,886
|
|
|
|
|
68
|
|
|
|
|
7,954
|
|
|
||||
Sovereign and supranational
|
|
0
|
|
|
|
|
1,909
|
|
|
|
|
0
|
|
|
|
|
1,909
|
|
|
||||
Banks/financial institutions
|
|
0
|
|
|
|
|
8,908
|
|
|
|
|
25
|
|
|
|
|
8,933
|
|
|
||||
Other corporate
|
|
0
|
|
|
|
|
32,327
|
|
|
|
|
146
|
|
|
|
|
32,473
|
|
|
||||
Total fixed maturity securities
|
|
30,109
|
|
|
|
|
53,790
|
|
|
|
|
414
|
|
|
|
|
84,313
|
|
(1)
|
||||
Equity securities
|
|
1,001
|
|
|
|
|
6
|
|
|
|
|
16
|
|
|
|
|
1,023
|
|
|
||||
Other investments
|
|
57
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
57
|
|
|
||||
Cash and cash equivalents
|
|
3,491
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
3,491
|
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency swaps
|
|
0
|
|
|
|
|
146
|
|
|
|
|
150
|
|
|
|
|
296
|
|
|
||||
Foreign currency forwards
|
|
0
|
|
|
|
|
22
|
|
|
|
|
0
|
|
|
|
|
22
|
|
|
||||
Foreign currency options
|
|
0
|
|
|
|
|
12
|
|
|
|
|
0
|
|
|
|
|
12
|
|
|
||||
Credit default swaps
|
|
0
|
|
|
|
|
0
|
|
|
|
|
1
|
|
|
|
|
1
|
|
|
||||
Total other assets
|
|
0
|
|
|
|
|
180
|
|
|
|
|
151
|
|
|
|
|
331
|
|
|
||||
Total assets
|
|
$
|
34,658
|
|
|
|
|
$
|
53,976
|
|
|
|
|
$
|
581
|
|
|
|
|
$
|
89,215
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency swaps
|
|
$
|
0
|
|
|
|
|
$
|
69
|
|
|
|
|
$
|
128
|
|
|
|
|
$
|
197
|
|
|
Foreign currency forwards
|
|
0
|
|
|
|
|
274
|
|
|
|
|
0
|
|
|
|
|
274
|
|
|
||||
Foreign currency options
|
|
0
|
|
|
|
|
3
|
|
|
|
|
0
|
|
|
|
|
3
|
|
|
||||
Total liabilities
|
|
$
|
0
|
|
|
|
|
$
|
346
|
|
|
|
|
$
|
128
|
|
|
|
|
$
|
474
|
|
|
|
March 31, 2018
|
|||||||||||||||||||||||||||
(In millions)
|
Carrying
Value |
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Fair Value |
||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Securities held to maturity,
carried at amortized cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Government and agencies
|
|
$
|
22,686
|
|
|
|
$
|
28,317
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
28,317
|
|
|
Municipalities
|
|
379
|
|
|
|
0
|
|
|
|
|
493
|
|
|
|
|
0
|
|
|
|
|
493
|
|
|
|||||
Mortgage and asset-backed
securities |
|
26
|
|
|
|
0
|
|
|
|
|
9
|
|
|
|
|
19
|
|
|
|
|
28
|
|
|
|||||
Public utilities
|
|
3,508
|
|
|
|
0
|
|
|
|
|
3,891
|
|
|
|
|
0
|
|
|
|
|
3,891
|
|
|
|||||
Sovereign and
supranational |
|
1,620
|
|
|
|
0
|
|
|
|
|
1,919
|
|
|
|
|
0
|
|
|
|
|
1,919
|
|
|
|||||
Banks/financial institutions
|
|
2,300
|
|
|
|
0
|
|
|
|
|
2,477
|
|
|
|
|
0
|
|
|
|
|
2,477
|
|
|
|||||
Other corporate
|
|
2,858
|
|
|
|
0
|
|
|
|
|
3,343
|
|
|
|
|
0
|
|
|
|
|
3,343
|
|
|
|||||
Other investments
(1)
|
|
4,608
|
|
|
|
0
|
|
|
|
|
15
|
|
|
|
|
4,575
|
|
|
|
|
4,590
|
|
|
|||||
Total assets
|
|
$
|
37,985
|
|
|
|
$
|
28,317
|
|
|
|
|
$
|
12,147
|
|
|
|
|
$
|
4,594
|
|
|
|
|
$
|
45,058
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other policyholders’ funds
|
|
$
|
7,417
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
7,307
|
|
|
|
|
$
|
7,307
|
|
|
Notes payable
(excluding capital leases) |
|
5,352
|
|
|
|
0
|
|
|
|
|
5,146
|
|
|
|
|
281
|
|
|
|
|
5,427
|
|
|
|||||
Total liabilities
|
|
$
|
12,769
|
|
|
|
$
|
0
|
|
|
|
|
$
|
5,146
|
|
|
|
|
$
|
7,588
|
|
|
|
|
$
|
12,734
|
|
|
|
December 31, 2017
|
|||||||||||||||||||||||||||
(In millions)
|
Carrying
Value |
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Fair Value |
||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Securities held to maturity,
carried at amortized cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Government and agencies
|
|
$
|
21,331
|
|
|
|
$
|
26,491
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
26,491
|
|
|
Municipalities
|
|
357
|
|
|
|
0
|
|
|
|
|
462
|
|
|
|
|
0
|
|
|
|
|
462
|
|
|
|||||
Mortgage and asset-backed
securities |
|
26
|
|
|
|
0
|
|
|
|
|
8
|
|
|
|
|
19
|
|
|
|
|
27
|
|
|
|||||
Public utilities
|
|
3,300
|
|
|
|
0
|
|
|
|
|
3,698
|
|
|
|
|
0
|
|
|
|
|
3,698
|
|
|
|||||
Sovereign and
supranational |
|
1,523
|
|
|
|
0
|
|
|
|
|
1,835
|
|
|
|
|
0
|
|
|
|
|
1,835
|
|
|
|||||
Banks/financial institutions
|
|
2,206
|
|
|
|
0
|
|
|
|
|
2,387
|
|
|
|
|
0
|
|
|
|
|
2,387
|
|
|
|||||
Other corporate
|
|
2,687
|
|
|
|
0
|
|
|
|
|
3,172
|
|
|
|
|
0
|
|
|
|
|
3,172
|
|
|
|||||
Other investments
(1)
|
|
3,017
|
|
|
|
0
|
|
|
|
|
15
|
|
|
|
|
2,987
|
|
|
|
|
3,002
|
|
|
|||||
Total assets
|
|
$
|
34,447
|
|
|
|
$
|
26,491
|
|
|
|
|
$
|
11,577
|
|
|
|
|
$
|
3,006
|
|
|
|
|
$
|
41,074
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other policyholders’ funds
|
|
$
|
6,939
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
6,841
|
|
|
|
|
$
|
6,841
|
|
|
Notes payable
(excluding capital leases) |
|
5,267
|
|
|
|
0
|
|
|
|
|
5,288
|
|
|
|
|
265
|
|
|
|
|
5,553
|
|
|
|||||
Total liabilities
|
|
$
|
12,206
|
|
|
|
$
|
0
|
|
|
|
|
$
|
5,288
|
|
|
|
|
$
|
7,106
|
|
|
|
|
$
|
12,394
|
|
|
|
|
March 31, 2018
|
||||||||||||||||||||||
(In millions)
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
|
Significant Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
|
Total
Fair Value |
||||||||||||||||
Securities available for sale, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Government and agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
$
|
35,325
|
|
|
|
|
$
|
1,411
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
36,736
|
|
|
Total government and agencies
|
|
|
35,325
|
|
|
|
|
1,411
|
|
|
|
|
0
|
|
|
|
|
36,736
|
|
|
||||
Municipalities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
1,373
|
|
|
|
|
0
|
|
|
|
|
1,373
|
|
|
||||
Total municipalities
|
|
|
0
|
|
|
|
|
1,373
|
|
|
|
|
0
|
|
|
|
|
1,373
|
|
|
||||
Mortgage- and asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
269
|
|
|
|
|
0
|
|
|
|
|
269
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
186
|
|
|
|
|
186
|
|
|
||||
Total mortgage- and asset-backed securities
|
|
|
0
|
|
|
|
|
269
|
|
|
|
|
186
|
|
|
|
|
455
|
|
|
||||
Public utilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
7,724
|
|
|
|
|
0
|
|
|
|
|
7,724
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
83
|
|
|
|
|
83
|
|
|
||||
Total public utilities
|
|
|
0
|
|
|
|
|
7,724
|
|
|
|
|
83
|
|
|
|
|
7,807
|
|
|
||||
Sovereign and supranational:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
1,866
|
|
|
|
|
0
|
|
|
|
|
1,866
|
|
|
||||
Total sovereign and supranational
|
|
|
0
|
|
|
|
|
1,866
|
|
|
|
|
0
|
|
|
|
|
1,866
|
|
|
||||
Banks/financial institutions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
9,120
|
|
|
|
|
0
|
|
|
|
|
9,120
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
24
|
|
|
|
|
24
|
|
|
||||
Total banks/financial institutions
|
|
|
0
|
|
|
|
|
9,120
|
|
|
|
|
24
|
|
|
|
|
9,144
|
|
|
||||
Other corporate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
31,509
|
|
|
|
|
0
|
|
|
|
|
31,509
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
143
|
|
|
|
|
143
|
|
|
||||
Total other corporate
|
|
|
0
|
|
|
|
|
31,509
|
|
|
|
|
143
|
|
|
|
|
31,652
|
|
|
||||
Total securities available for sale
|
|
|
$
|
35,325
|
|
|
|
|
$
|
53,272
|
|
|
|
|
$
|
436
|
|
|
|
|
$
|
89,033
|
|
(1)
|
Equity securities, carried at fair value:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
$
|
1,015
|
|
|
|
|
$
|
77
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
1,092
|
|
|
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
16
|
|
|
|
|
16
|
|
|
||||
Total equity securities
|
|
|
$
|
1,015
|
|
|
|
|
$
|
77
|
|
|
|
|
$
|
16
|
|
|
|
|
$
|
1,108
|
|
(1)
|
|
|
March 31, 2018
|
||||||||||||||||||||||
(In millions)
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
|
Significant Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
|
Total
Fair Value |
||||||||||||||||
Securities held to maturity, carried at amortized cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Government and agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
$
|
28,317
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
28,317
|
|
|
Total government and agencies
|
|
|
28,317
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
28,317
|
|
|
||||
Municipalities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
493
|
|
|
|
|
0
|
|
|
|
|
493
|
|
|
||||
Total municipalities
|
|
|
0
|
|
|
|
|
493
|
|
|
|
|
0
|
|
|
|
|
493
|
|
|
||||
Mortgage- and asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
9
|
|
|
|
|
0
|
|
|
|
|
9
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
19
|
|
|
|
|
19
|
|
|
||||
Total mortgage- and asset-backed securities
|
|
|
0
|
|
|
|
|
9
|
|
|
|
|
19
|
|
|
|
|
28
|
|
|
||||
Public utilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
3,891
|
|
|
|
|
0
|
|
|
|
|
3,891
|
|
|
||||
Total public utilities
|
|
|
0
|
|
|
|
|
3,891
|
|
|
|
|
0
|
|
|
|
|
3,891
|
|
|
||||
Sovereign and supranational:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
1,919
|
|
|
|
|
0
|
|
|
|
|
1,919
|
|
|
||||
Total sovereign and supranational
|
|
|
0
|
|
|
|
|
1,919
|
|
|
|
|
0
|
|
|
|
|
1,919
|
|
|
||||
Banks/financial institutions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
2,477
|
|
|
|
|
0
|
|
|
|
|
2,477
|
|
|
||||
Total banks/financial institutions
|
|
|
0
|
|
|
|
|
2,477
|
|
|
|
|
0
|
|
|
|
|
2,477
|
|
|
||||
Other corporate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
3,343
|
|
|
|
|
0
|
|
|
|
|
3,343
|
|
|
||||
Total other corporate
|
|
|
0
|
|
|
|
|
3,343
|
|
|
|
|
0
|
|
|
|
|
3,343
|
|
|
||||
Total securities held to maturity
|
|
|
$
|
28,317
|
|
|
|
|
$
|
12,132
|
|
|
|
|
$
|
19
|
|
|
|
|
$
|
40,468
|
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
(In millions)
|
|
Quoted Prices in Active Markets
for Identical Assets (Level 1) |
|
Significant Observable
Inputs (Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
|
Total
Fair Value |
||||||||||||||||
Securities available for sale, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Government and agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
$
|
30,109
|
|
|
|
|
$
|
1,121
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
31,230
|
|
|
Total government and agencies
|
|
|
30,109
|
|
|
|
|
1,121
|
|
|
|
|
0
|
|
|
|
|
31,230
|
|
|
||||
Municipalities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
1,370
|
|
|
|
|
0
|
|
|
|
|
1,370
|
|
|
||||
Total municipalities
|
|
|
0
|
|
|
|
|
1,370
|
|
|
|
|
0
|
|
|
|
|
1,370
|
|
|
||||
Mortgage- and asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
269
|
|
|
|
|
0
|
|
|
|
|
269
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
175
|
|
|
|
|
175
|
|
|
||||
Total mortgage- and asset-backed securities
|
|
|
0
|
|
|
|
|
269
|
|
|
|
|
175
|
|
|
|
|
444
|
|
|
||||
Public utilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
7,886
|
|
|
|
|
0
|
|
|
|
|
7,886
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
68
|
|
|
|
|
68
|
|
|
||||
Total public utilities
|
|
|
0
|
|
|
|
|
7,886
|
|
|
|
|
68
|
|
|
|
|
7,954
|
|
|
||||
Sovereign and supranational:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
1,807
|
|
|
|
|
0
|
|
|
|
|
1,807
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
102
|
|
|
|
|
0
|
|
|
|
|
102
|
|
|
||||
Total sovereign and supranational
|
|
|
0
|
|
|
|
|
1,909
|
|
|
|
|
0
|
|
|
|
|
1,909
|
|
|
||||
Banks/financial institutions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
8,908
|
|
|
|
|
0
|
|
|
|
|
8,908
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
25
|
|
|
|
|
25
|
|
|
||||
Total banks/financial institutions
|
|
|
0
|
|
|
|
|
8,908
|
|
|
|
|
25
|
|
|
|
|
8,933
|
|
|
||||
Other corporate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
32,327
|
|
|
|
|
0
|
|
|
|
|
32,327
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
146
|
|
|
|
|
146
|
|
|
||||
Total other corporate
|
|
|
0
|
|
|
|
|
32,327
|
|
|
|
|
146
|
|
|
|
|
32,473
|
|
|
||||
Total securities available for sale
|
|
|
$
|
30,109
|
|
|
|
|
$
|
53,790
|
|
|
|
|
$
|
414
|
|
|
|
|
$
|
84,313
|
|
(1)
|
Equity securities, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
$
|
1,001
|
|
|
|
|
$
|
6
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
1,007
|
|
|
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
16
|
|
|
|
|
16
|
|
|
||||
Total equity securities
|
|
|
$
|
1,001
|
|
|
|
|
$
|
6
|
|
|
|
|
$
|
16
|
|
|
|
|
$
|
1,023
|
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
(In millions)
|
|
Quoted Prices in Active Markets
for Identical Assets (Level 1) |
|
Significant Observable
Inputs (Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
|
Total
Fair Value |
||||||||||||||||
Securities held to maturity, carried at amortized cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Government and agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
$
|
26,491
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
26,491
|
|
|
Total government and agencies
|
|
|
26,491
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
26,491
|
|
|
||||
Municipalities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
462
|
|
|
|
|
0
|
|
|
|
|
462
|
|
|
||||
Total municipalities
|
|
|
0
|
|
|
|
|
462
|
|
|
|
|
0
|
|
|
|
|
462
|
|
|
||||
Mortgage- and asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
8
|
|
|
|
|
0
|
|
|
|
|
8
|
|
|
||||
Broker/other
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
19
|
|
|
|
|
19
|
|
|
||||
Total mortgage- and asset-backed securities
|
|
|
0
|
|
|
|
|
8
|
|
|
|
|
19
|
|
|
|
|
27
|
|
|
||||
Public utilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
3,698
|
|
|
|
|
0
|
|
|
|
|
3,698
|
|
|
||||
Total public utilities
|
|
|
0
|
|
|
|
|
3,698
|
|
|
|
|
0
|
|
|
|
|
3,698
|
|
|
||||
Sovereign and supranational:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
1,835
|
|
|
|
|
0
|
|
|
|
|
1,835
|
|
|
||||
Total sovereign and supranational
|
|
|
0
|
|
|
|
|
1,835
|
|
|
|
|
0
|
|
|
|
|
1,835
|
|
|
||||
Banks/financial institutions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
2,387
|
|
|
|
|
0
|
|
|
|
|
2,387
|
|
|
||||
Total banks/financial institutions
|
|
|
0
|
|
|
|
|
2,387
|
|
|
|
|
0
|
|
|
|
|
2,387
|
|
|
||||
Other corporate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Third party pricing vendor
|
|
|
0
|
|
|
|
|
3,172
|
|
|
|
|
0
|
|
|
|
|
3,172
|
|
|
||||
Total other corporate
|
|
|
0
|
|
|
|
|
3,172
|
|
|
|
|
0
|
|
|
|
|
3,172
|
|
|
||||
Total securities held to maturity
|
|
|
$
|
26,491
|
|
|
|
|
$
|
11,562
|
|
|
|
|
$
|
19
|
|
|
|
|
$
|
38,072
|
|
|
|
|
Three Months Ended
March 31, 2018 |
||||||||||||||||||||||||||||||||
|
Fixed Maturity Securities
|
|
Equity
Securities |
|
Derivatives
(1)
|
|
|
|
||||||||||||||||||||||||
(In millions)
|
Mortgage-
and Asset- Backed Securities |
|
Public
Utilities |
|
Banks/
Financial Institutions |
|
Other
Corporate |
|
|
|
Foreign
Currency Swaps |
|
Credit
Default Swaps |
|
Total
|
|
||||||||||||||||
Balance, beginning of period
|
$
|
175
|
|
|
$
|
68
|
|
|
$
|
25
|
|
|
$
|
146
|
|
|
$
|
16
|
|
|
$
|
22
|
|
|
$
|
1
|
|
|
$
|
453
|
|
|
Realized investment gains (losses) included
in earnings |
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
126
|
|
|
0
|
|
|
126
|
|
|
||||||||
Unrealized gains (losses) included in other
comprehensive income (loss) |
11
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
0
|
|
|
6
|
|
|
0
|
|
|
13
|
|
|
||||||||
Purchases, issuances, sales and settlements:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Purchases
|
0
|
|
|
16
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
16
|
|
|
||||||||
Issuances
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Sales
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Settlements
|
0
|
|
|
0
|
|
|
0
|
|
|
(1
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|
(1
|
)
|
|
||||||||
Transfers into Level 3
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Transfers out of Level 3
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Balance, end of period
|
$
|
186
|
|
|
$
|
83
|
|
|
$
|
24
|
|
|
$
|
143
|
|
|
$
|
16
|
|
|
$
|
154
|
|
|
$
|
1
|
|
|
$
|
607
|
|
|
Changes in unrealized gains (losses) relating
to Level 3 assets and liabilities still held at the end of the period included in realized investment gains (losses) |
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
126
|
|
|
$
|
0
|
|
|
$
|
126
|
|
|
Three Months Ended
March 31, 2017 |
||||||||||||||||||||||||||||||||
|
Fixed Maturity Securities
|
|
Equity
Securities |
|
Derivatives
(1)
|
|
|
|
||||||||||||||||||||||||
(In millions)
|
Mortgage-
and Asset- Backed Securities |
|
Public
Utilities |
|
Banks/
Financial Institutions |
|
Other
Corporate |
|
|
|
Foreign
Currency Swaps |
|
Credit
Default Swaps |
|
Total
|
|
||||||||||||||||
Balance, beginning of period
|
$
|
198
|
|
|
$
|
16
|
|
|
$
|
25
|
|
|
$
|
0
|
|
|
$
|
3
|
|
|
$
|
(21
|
)
|
|
$
|
2
|
|
|
$
|
223
|
|
|
Realized investment gains (losses) included
in earnings
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
38
|
|
|
0
|
|
|
38
|
|
|
||||||||
Unrealized gains (losses) included in other
comprehensive income (loss)
|
6
|
|
|
0
|
|
|
(1
|
)
|
|
0
|
|
|
0
|
|
|
2
|
|
|
0
|
|
|
7
|
|
|
||||||||
Purchases, issuances, sales and settlements:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Purchases
|
0
|
|
|
0
|
|
|
0
|
|
|
35
|
|
|
2
|
|
|
0
|
|
|
0
|
|
|
37
|
|
|
||||||||
Issuances
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Sales
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
(1
|
)
|
|
0
|
|
|
0
|
|
|
(1
|
)
|
|
||||||||
Settlements
|
(9
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
(9
|
)
|
|
||||||||
Transfers into Level 3
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Transfers out of Level 3
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
||||||||
Balance, end of period
|
$
|
195
|
|
|
$
|
16
|
|
|
$
|
24
|
|
|
$
|
35
|
|
|
$
|
4
|
|
|
$
|
19
|
|
|
$
|
2
|
|
|
$
|
295
|
|
|
Changes in unrealized gains (losses) relating
to Level 3 assets and liabilities still held at the end of the period included in realized investment gains (losses) |
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
38
|
|
|
$
|
0
|
|
|
$
|
38
|
|
|
March 31, 2018
|
|||||||||||||
(In millions)
|
|
Fair Value
|
|
Valuation Technique(s)
|
|
Unobservable Input
|
|
Range
(Weighted Average) |
|
||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||
Securities available for sale, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
||
Mortgage- and asset-backed securities
|
|
|
$
|
186
|
|
|
|
Consensus pricing
|
|
Offered quotes
|
|
N/A
|
(c)
|
Public utilities
|
|
|
83
|
|
|
|
Discounted cash flow
|
|
Credit spreads
|
|
N/A
|
(c)
|
|
Banks/financial institutions
|
|
|
24
|
|
|
|
Consensus pricing
|
|
Offered quotes
|
|
N/A
|
(c)
|
|
Other corporate
|
|
|
143
|
|
|
|
Discounted cash flow
|
|
Credit spreads
|
|
N/A
|
(c)
|
|
Equity securities
|
|
|
16
|
|
|
|
Net asset value
|
|
Offered quotes
|
|
N/A
|
(c)
|
|
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
||
Foreign currency swaps
|
|
|
185
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.78% - 2.82%
|
(a)
|
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
|
|
|
|
|
|
|
|
CDS spreads
|
|
13 - 101 bps
|
|
||
|
|
|
55
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.78% - 2.82%
|
(a)
|
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
Credit default swaps
|
|
|
1
|
|
|
|
Discounted cash flow
|
|
Base correlation
|
|
49.98% - 54.13%
|
(d)
|
|
|
|
|
|
|
|
|
|
CDS spreads
|
|
15 bps
|
|
||
|
|
|
|
|
|
|
|
Recovery rate
|
|
37.24%
|
|
||
Total assets
|
|
|
$
|
693
|
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|||||||||||||
(In millions)
|
|
Fair Value
|
|
Valuation Technique(s)
|
|
Unobservable Input
|
|
Range
(Weighted Average) |
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||
Other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||
Foreign currency swaps
|
|
|
$
|
84
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.78% - 2.82%
|
(a)
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
|
|
|
|
|
|
|
|
CDS spreads
|
|
17 - 170 bps
|
|
||
|
|
|
2
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.78% - 2.82%
|
(a)
|
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
Total liabilities
|
|
|
$
|
86
|
|
|
|
|
|
|
|
|
|
December 31, 2017
|
|||||||||||||
(In millions)
|
|
Fair Value
|
|
Valuation Technique(s)
|
|
Unobservable Input
|
|
Range
(Weighted Average) |
|
||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||
Securities available for sale, carried at fair value:
|
|
|
|
|
|
|
|
|
|
|
|
||
Fixed maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
||
Mortgage- and asset-backed securities
|
|
|
$
|
175
|
|
|
|
Consensus pricing
|
|
Offered quotes
|
|
N/A
|
(c)
|
Public utilities
|
|
|
68
|
|
|
|
Discounted cash flow
|
|
Credit spreads
|
|
N/A
|
(c)
|
|
Banks/financial institutions
|
|
|
25
|
|
|
|
Consensus pricing
|
|
Offered quotes
|
|
N/A
|
(c)
|
|
Other corporate
|
|
|
146
|
|
|
|
Discounted cash flow
|
|
Credit spreads
|
|
N/A
|
(c)
|
|
Equity securities
|
|
|
16
|
|
|
|
Net asset value
|
|
Offered quotes
|
|
N/A
|
(c)
|
|
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
||
Foreign currency swaps
|
|
|
80
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.40% - 2.54%
|
(a)
|
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
|
|
|
|
|
|
|
|
CDS spreads
|
|
9 - 90 bps
|
|
||
|
|
|
70
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.40% - 2.54%
|
(a)
|
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
Credit default swaps
|
|
|
1
|
|
|
|
Discounted cash flow
|
|
Base correlation
|
|
46.33% - 49.65%
|
(d)
|
|
|
|
|
|
|
|
|
|
CDS spreads
|
|
25 bps
|
|
||
|
|
|
|
|
|
|
|
Recovery rate
|
|
37.24%
|
|
||
Total assets
|
|
|
$
|
581
|
|
|
|
|
|
|
|
|
|
December 31, 2017
|
|
||||||||||||
(In millions)
|
|
Fair Value
|
|
Valuation Technique(s)
|
|
Unobservable Input
|
|
Range
(Weighted Average) |
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||
Other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||
Foreign currency swaps
|
|
|
$
|
120
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.40% - 2.54%
|
(a)
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
|
|
|
|
|
|
|
|
CDS spreads
|
|
13 - 157 bps
|
|
||
|
|
|
8
|
|
|
|
Discounted cash flow
|
|
Interest rates (USD)
|
|
2.40% - 2.54%
|
(a)
|
|
|
|
|
|
|
|
|
|
Interest rates (JPY)
|
|
.26% - .85%
|
(b)
|
||
Total liabilities
|
|
|
$
|
128
|
|
|
|
|
|
|
|
|
|
6.
|
POLICY LIABILITIES
|
|
Three Months Ended
March 31, |
||||||||
(In millions)
|
|
2018
|
|
2017
|
|
||||
Unpaid supplemental health claims, beginning of period
|
|
$
|
3,884
|
|
|
$
|
3,707
|
|
|
Less reinsurance recoverables
|
|
30
|
|
|
27
|
|
|
||
Net balance, beginning of period
|
|
3,854
|
|
|
3,680
|
|
|
||
Add claims incurred during the period related to:
|
|
|
|
|
|
||||
Current year
|
|
1,842
|
|
|
1,737
|
|
|
||
Prior years
|
|
(192
|
)
|
|
(111
|
)
|
|
||
Total incurred
|
|
1,650
|
|
|
1,626
|
|
|
||
Less claims paid during the period on claims incurred during:
|
|
|
|
|
|
||||
Current year
|
|
518
|
|
|
505
|
|
|
||
Prior years
|
|
1,116
|
|
|
1,055
|
|
|
||
Total paid
|
|
1,634
|
|
|
1,560
|
|
|
||
Effect of foreign exchange rate changes on unpaid claims
|
|
142
|
|
|
80
|
|
|
||
Net balance, end of period
|
|
4,012
|
|
|
3,826
|
|
|
||
Add reinsurance recoverables
|
|
31
|
|
|
29
|
|
|
||
Unpaid supplemental health claims, end of period
|
|
4,043
|
|
|
3,855
|
|
|
||
Unpaid life claims, end of period
|
|
587
|
|
|
375
|
|
|
||
Total liability for unpaid policy claims
|
|
$
|
4,630
|
|
|
$
|
4,230
|
|
|
7.
|
REINSURANCE
|
|
Three Months Ended
March 31, |
|
||||||||||
(In millions)
|
2018
|
|
2017
|
|
||||||||
Direct premium income
|
|
$
|
4,833
|
|
|
|
|
$
|
4,724
|
|
|
|
Ceded to other companies:
|
|
|
|
|
|
|
|
|
||||
Ceded Aflac Japan closed blocks
|
|
(129
|
)
|
|
|
|
(130
|
)
|
|
|
||
Other
|
|
(15
|
)
|
|
|
|
(12
|
)
|
|
|
||
Assumed from other companies:
|
|
|
|
|
|
|
|
|
||||
Retrocession activities
|
|
54
|
|
|
|
|
54
|
|
|
|
||
Other
|
|
2
|
|
|
|
|
2
|
|
|
|
||
Net premium income
|
|
$
|
4,745
|
|
|
|
|
$
|
4,638
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct benefits and claims
|
|
$
|
3,119
|
|
|
|
|
$
|
3,129
|
|
|
|
Ceded benefits and change in reserves for future benefits:
|
|
|
|
|
|
|
|
|
||||
Ceded Aflac Japan closed blocks
|
|
(117
|
)
|
|
|
|
(122
|
)
|
|
|
||
Eliminations
|
|
12
|
|
|
|
|
13
|
|
|
|
||
Other
|
|
(12
|
)
|
|
|
|
(11
|
)
|
|
|
||
Assumed from other companies:
|
|
|
|
|
|
|
|
|
||||
Retrocession activities
|
|
52
|
|
|
|
|
54
|
|
|
|
||
Eliminations
|
|
(12
|
)
|
|
|
|
(13
|
)
|
|
|
||
Other
|
|
0
|
|
|
|
|
2
|
|
|
|
||
Benefits and claims, net
|
|
$
|
3,042
|
|
|
|
|
$
|
3,052
|
|
|
|
8.
|
NOTES PAYABLE
|
(In millions)
|
March 31, 2018
|
|
December 31, 2017
|
||||||||
2.40% senior notes due March 2020
|
|
$
|
548
|
|
|
|
|
$
|
548
|
|
|
4.00% senior notes due February 2022
|
|
348
|
|
|
|
|
348
|
|
|
||
3.625% senior notes due June 2023
|
|
697
|
|
|
|
|
697
|
|
|
||
3.625% senior notes due November 2024
|
|
746
|
|
|
|
|
745
|
|
|
||
3.25% senior notes due March 2025
|
|
446
|
|
|
|
|
446
|
|
|
||
2.875% senior notes due October 2026
|
|
297
|
|
|
|
|
297
|
|
|
||
6.90% senior notes due December 2039
|
|
220
|
|
|
|
|
220
|
|
|
||
6.45% senior notes due August 2040
|
|
254
|
|
|
|
|
254
|
|
|
||
4.00% senior notes due October 2046
|
|
394
|
|
|
|
|
394
|
|
|
||
Yen-denominated senior notes and subordinated debentures:
|
|
|
|
|
|
|
|
||||
.932% senior notes due January 2027 (principal amount 60.0 billion yen)
|
|
562
|
|
|
|
|
528
|
|
|
||
2.108% subordinated debentures due October 2047 (principal amount 60.0 billion yen)
|
|
559
|
|
|
|
|
526
|
|
|
||
Yen-denominated loans:
|
|
|
|
|
|
|
|
||||
Variable interest rate loan due September 2021 (.32% in 2018 and 2017, principal amount 5.0 billion yen)
|
|
47
|
|
|
|
|
44
|
|
|
||
Variable interest rate loan due September 2023 (.47% in 2018 and 2017, principal amount 25.0 billion yen)
|
|
234
|
|
|
|
|
220
|
|
|
||
Capitalized lease obligations payable through 2025
|
|
20
|
|
|
|
|
22
|
|
|
||
Total notes payable
|
|
$
|
5,372
|
|
|
|
|
$
|
5,289
|
|
|
9.
|
INCOME TAXES
|
10.
|
SHAREHOLDERS’ EQUITY
|
(In thousands of shares)
|
2018
|
|
2017
|
||
Common stock - issued:
|
|
|
|
||
Balance, beginning of period
|
1,345,762
|
|
|
1,342,498
|
|
Exercise of stock options and issuance of restricted shares
|
1,014
|
|
|
868
|
|
Balance, end of period
|
1,346,776
|
|
|
1,343,366
|
|
Treasury stock:
|
|
|
|
||
Balance, beginning of period
|
564,852
|
|
|
530,877
|
|
Purchases of treasury stock:
|
|
|
|
||
Open market
|
6,640
|
|
|
16,986
|
|
Other
|
315
|
|
|
288
|
|
Dispositions of treasury stock:
|
|
|
|
||
Shares issued to AFL Stock Plan
|
(384
|
)
|
|
(494
|
)
|
Exercise of stock options
|
(305
|
)
|
|
(256
|
)
|
Other
|
(99
|
)
|
|
(40
|
)
|
Balance, end of period
|
571,019
|
|
|
547,361
|
|
Shares outstanding, end of period
|
775,757
|
|
|
796,005
|
|
|
Three Months Ended
March 31, |
|
|||||||
(In thousands)
|
2018
|
|
2017
|
||||||
Anti-dilutive share-based awards
|
|
9
|
|
|
|
|
642
|
|
|
Three Months Ended
March 31, 2018 |
|||||||||||||||||||||||||||||
(In millions)
|
Unrealized Foreign
Currency Translation Gains (Losses) |
|
Unrealized
Gains (Losses) on Investment Securities |
|
Unrealized
Gains (Losses) on Derivatives |
|
Pension
Liability Adjustment |
|
Total
|
||||||||||||||||||||
Balance, beginning of period
|
|
$
|
(1,750
|
)
|
|
|
|
$
|
5,964
|
|
|
|
|
$
|
(23
|
)
|
|
|
|
$
|
(163
|
)
|
|
|
|
$
|
4,028
|
|
|
Other comprehensive
income (loss) before reclassification |
|
447
|
|
|
|
|
(983
|
)
|
|
|
|
2
|
|
|
|
|
(37
|
)
|
|
|
|
(571
|
)
|
|
|||||
Amounts reclassified from
accumulated other comprehensive income (loss) |
|
0
|
|
|
|
|
225
|
|
(1)
|
|
|
0
|
|
|
|
|
3
|
|
|
|
|
228
|
|
|
|||||
Net current-period other
comprehensive income (loss) |
|
447
|
|
|
|
|
(758
|
)
|
|
|
|
2
|
|
|
|
|
(34
|
)
|
|
|
|
(343
|
)
|
|
|||||
Balance, end of period
|
|
$
|
(1,303
|
)
|
|
|
|
$
|
5,206
|
|
|
|
|
$
|
(21
|
)
|
|
|
|
$
|
(197
|
)
|
|
|
|
$
|
3,685
|
|
|
Three Months Ended
March 31, 2017 |
|||||||||||||||||||||||||||||
(In millions)
|
Unrealized Foreign
Currency Translation Gains (Losses) |
|
Unrealized
Gains (Losses) on Investment Securities |
|
Unrealized
Gains (Losses) on Derivatives |
|
Pension Liability Adjustment
|
|
Total
|
||||||||||||||||||||
Balance, beginning of period
|
|
$
|
(1,983
|
)
|
|
|
|
$
|
4,805
|
|
|
|
|
$
|
(24
|
)
|
|
|
|
$
|
(168
|
)
|
|
|
|
$
|
2,630
|
|
|
Other comprehensive
income (loss) before reclassification |
|
333
|
|
|
|
|
(341
|
)
|
|
|
|
2
|
|
|
|
|
(4
|
)
|
|
|
|
(10
|
)
|
|
|||||
Amounts reclassified from
accumulated other comprehensive income (loss) |
|
0
|
|
|
|
|
10
|
|
|
|
|
0
|
|
|
|
|
2
|
|
|
|
|
12
|
|
|
|||||
Net current-period other
comprehensive income (loss) |
|
333
|
|
|
|
|
(331
|
)
|
|
|
|
2
|
|
|
|
|
(2
|
)
|
|
|
|
2
|
|
|
|||||
Balance, end of period
|
|
$
|
(1,650
|
)
|
|
|
|
$
|
4,474
|
|
|
|
|
$
|
(22
|
)
|
|
|
|
$
|
(170
|
)
|
|
|
|
$
|
2,632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
Three Months Ended
March 31, 2018 |
|
||||
Details about Accumulated Other Comprehensive Income Components
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
Affected Line Item in the
Statements of Earnings |
||||
Unrealized gains (losses) on available-for-sale
securities |
|
$
|
2
|
|
|
Sales and redemptions
|
|
|
0
|
|
|
Other-than-temporary impairment
losses realized |
|
|
|
2
|
|
|
Total before tax
|
|
|
|
(1
|
)
|
|
Tax (expense) or benefit
(1)
|
|
|
|
$
|
1
|
|
|
Net of tax
|
Amortization of defined benefit pension items:
|
|
|
|
|
||
Actuarial gains (losses)
|
|
$
|
(4
|
)
|
|
Acquisition and operating expenses
(2)
|
Prior service (cost) credit
|
|
0
|
|
|
Acquisition and operating expenses
(2)
|
|
|
|
1
|
|
|
Tax (expense) or benefit
(1)
|
|
|
|
$
|
(3
|
)
|
|
Net of tax
|
Total reclassifications for the period
|
|
$
|
(2
|
)
|
|
Net of tax
|
(In millions)
|
Three Months Ended
March 31, 2017 |
|
||||
Details about Accumulated Other Comprehensive Income Components
|
Amount Reclassified from Accumulated Other Comprehensive Income
|
Affected Line Item in the
Statements of Earnings |
||||
Unrealized gains (losses) on available-for-sale
securities |
|
$
|
(6
|
)
|
|
Sales and redemptions
|
|
|
(10
|
)
|
|
Other-than-temporary impairment
losses realized |
|
|
|
(16
|
)
|
|
Total before tax
|
|
|
|
6
|
|
|
Tax (expense) or benefit
(1)
|
|
|
|
$
|
(10
|
)
|
|
Net of tax
|
Amortization of defined benefit pension items:
|
|
|
|
|
||
Actuarial gains (losses)
|
|
$
|
(3
|
)
|
|
Acquisition and operating expenses
(2)
|
Prior service (cost) credit
|
|
0
|
|
|
Acquisition and operating expenses
(2)
|
|
|
|
1
|
|
|
Tax (expense) or benefit
(1)
|
|
|
|
$
|
(2
|
)
|
|
Net of tax
|
Total reclassifications for the period
|
|
$
|
(12
|
)
|
|
Net of tax
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Option Shares (in thousands) |
|
Weighted-Average
Remaining Term (in years) |
|
Aggregate
Intrinsic Value (in millions) |
|
Weighted-Average
Exercise Price Per Share |
|||||||||||||
Outstanding
|
|
6,306
|
|
|
|
|
5.5
|
|
|
|
$
|
99
|
|
|
|
|
$
|
28.03
|
|
|
Exercisable
|
|
4,439
|
|
|
|
|
4.4
|
|
|
|
77
|
|
|
|
|
26.45
|
|
|
(In thousands of shares)
|
|
Shares
|
|
Weighted-Average
Grant-Date Fair Value
Per Share
|
|||||
Restricted stock at December 31, 2017
|
|
3,635
|
|
|
|
$
|
32.40
|
|
|
Granted in 2018
|
|
918
|
|
|
|
44.12
|
|
|
|
Canceled in 2018
|
|
(56
|
)
|
|
|
33.18
|
|
|
|
Vested in 2018
|
|
(980
|
)
|
|
|
31.50
|
|
|
|
Restricted stock at March 31, 2018
|
|
3,517
|
|
|
|
$
|
35.70
|
|
|
12.
|
BENEFIT PLANS
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||||||||||||||
|
|
Pension Benefits
|
|
Other
|
||||||||||||||||||||||||||||||||
|
|
Japan
|
|
U.S.
|
|
Postretirement Benefits
|
||||||||||||||||||||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||||||||||
Components of net periodic
benefit cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
|
|
$
|
5
|
|
|
|
|
$
|
5
|
|
|
|
|
$
|
7
|
|
|
|
|
$
|
6
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
Interest cost
|
|
|
2
|
|
|
|
|
1
|
|
|
|
|
9
|
|
|
|
|
8
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||||
Expected return on plan
assets |
|
|
(2
|
)
|
|
|
|
(1
|
)
|
|
|
|
(7
|
)
|
|
|
|
(6
|
)
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||||
Amortization of net actuarial
loss |
|
|
0
|
|
|
|
|
0
|
|
|
|
|
4
|
|
|
|
|
3
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||||
Amortization of prior service
cost (credit) |
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||||
Net periodic (benefit) cost
|
|
|
$
|
5
|
|
|
|
|
$
|
5
|
|
|
|
|
$
|
13
|
|
|
|
|
$
|
11
|
|
|
|
|
$
|
0
|
|
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13.
|
COMMITMENTS AND CONTINGENT LIABILITIES
|
14.
|
SUBSEQUENT EVENTS
|
•
|
difficult conditions in global capital markets and the economy
|
•
|
exposure to significant interest rate risk
|
•
|
concentration of business in Japan
|
•
|
foreign currency fluctuations in the yen/dollar exchange rate
|
•
|
failure to implement the conversion of the Japan branch to a legal subsidiary
|
•
|
limited availability of acceptable yen-denominated investments
|
•
|
deviations in actual experience from pricing and reserving assumptions
|
•
|
ability to continue to develop and implement improvements in information technology systems
|
•
|
governmental actions for the purpose of stabilizing the financial markets
|
•
|
interruption in telecommunication, information technology and other operational systems, or a failure to maintain the security, confidentiality or privacy of sensitive data residing on such systems
|
•
|
ongoing changes in the Company's industry
|
•
|
failure to comply with restrictions on patient privacy and information security
|
•
|
extensive regulation and changes in law or regulation by governmental authorities
|
•
|
tax rates applicable to the Company may change
|
•
|
defaults and credit downgrades of investments
|
•
|
ability to attract and retain qualified sales associates, brokers, employees and distribution partners
|
•
|
decline in creditworthiness of other financial institutions
|
•
|
subsidiaries' ability to pay dividends to Aflac Incorporated
|
•
|
decreases in the Company's financial strength or debt ratings
|
•
|
inherent limitations to risk management policies and procedures
|
•
|
concentration of the Company's investments in any particular single-issuer or sector
|
•
|
differing judgments applied to investment valuations
|
•
|
ability to effectively manage key executive succession
|
•
|
significant valuation judgments in determination of amount of impairments taken on the Company's investments
|
•
|
catastrophic events including, but not necessarily limited to, epidemics, pandemics, tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, terrorism or other acts of violence, and damage incidental to such events
|
•
|
changes in U.S. and/or Japanese accounting standards
|
•
|
loss of consumer trust resulting from events external to the Company's operations
|
•
|
increased expenses and reduced profitability resulting from changes in assumptions for pension and other postretirement benefit plans
|
•
|
level and outcome of litigation
|
•
|
failure of internal controls or corporate governance policies and procedures
|
•
|
The Company's Business
|
•
|
Performance Highlights
|
•
|
Critical Accounting Estimates
|
•
|
Results of Operations, consolidated and by segment
|
•
|
Analysis of Financial Condition
|
•
|
Capital Resources and Liquidity
|
|
In Millions
|
|
Per Diluted Share
|
|
||||||||||||
|
Three Months Ended March 31,
|
|
||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||
Net earnings
|
$
|
717
|
|
|
$
|
592
|
|
|
$
|
.91
|
|
|
$
|
.73
|
|
|
Items impacting net earnings:
|
|
|
|
|
|
|
|
|
||||||||
Realized investment (gains) losses
(2),(3),(4)
|
98
|
|
|
109
|
|
|
.13
|
|
|
.14
|
|
|
||||
Other and non-recurring (income) loss
|
29
|
|
|
20
|
|
|
.04
|
|
|
.02
|
|
|
||||
Income tax (benefit) expense on items excluded from
adjusted earnings |
(24
|
)
|
|
(45
|
)
|
|
(.03
|
)
|
|
(.05
|
)
|
|
||||
Adjusted earnings
|
821
|
|
|
676
|
|
|
1.05
|
|
|
.84
|
|
|
||||
Current period foreign currency impact
(5)
|
(21
|
)
|
|
N/A
|
|
|
(.03
|
)
|
|
N/A
|
|
|
||||
Adjusted earnings excluding current period foreign currency
impact (6) |
$
|
800
|
|
|
$
|
676
|
|
|
$
|
1.02
|
|
|
$
|
.84
|
|
|
|
Three Months Ended
March 31, |
|
||||||
(In millions)
|
2018
|
|
2017
|
|
||||
Net premium income
|
$
|
3,263
|
|
|
$
|
3,194
|
|
|
Net investment income:
|
|
|
|
|
||||
Yen-denominated investment income
|
331
|
|
|
323
|
|
|
||
U.S. dollar-denominated investment income
|
312
|
|
|
286
|
|
|
||
Net investment income
|
643
|
|
|
609
|
|
|
||
Amortized hedge costs related to foreign currency denominated investments
|
55
|
|
|
52
|
|
|
||
Net investment income, less amortized hedge costs
|
588
|
|
|
557
|
|
|
||
Other income (loss)
|
12
|
|
|
10
|
|
|
||
Total adjusted revenues
|
3,863
|
|
|
3,761
|
|
|
||
Benefits and claims, net
|
2,294
|
|
|
2,288
|
|
|
||
Adjusted expenses:
|
|
|
|
|
||||
Amortization of deferred policy acquisition costs
|
168
|
|
|
154
|
|
|
||
Insurance commissions
|
190
|
|
|
184
|
|
|
||
Insurance and other expenses
|
393
|
|
|
366
|
|
|
||
Total adjusted expenses
|
751
|
|
|
704
|
|
|
||
Total benefits and expenses
|
3,045
|
|
|
2,992
|
|
|
||
Pretax adjusted earnings
(1)
|
$
|
818
|
|
|
$
|
769
|
|
|
Weighted-average yen/dollar exchange rate
|
108.05
|
|
|
113.56
|
|
|
|
In Dollars
|
In Yen
|
||||||||||
Percentage change over
previous period:
|
Three Months Ended
March 31, |
|
Three Months Ended
March 31, |
|
||||||||
2018
|
|
2017
|
|
2018
|
|
2017
|
|
|||||
Net premium income
|
2.2
|
%
|
|
.5
|
%
|
|
(2.6
|
)%
|
|
(1.1
|
)%
|
|
Net investment income, less amortized hedge costs
|
5.6
|
|
|
(5.4
|
)
|
|
.0
|
|
|
(6.3
|
)
|
|
Total adjusted revenues
|
2.7
|
|
|
(.4
|
)
|
|
(2.2
|
)
|
|
(1.9
|
)
|
|
Pretax adjusted earnings
(1)
|
6.4
|
|
|
(4.7
|
)
|
|
.9
|
|
|
(5.6
|
)
|
|
|
Including Foreign
Currency Changes |
|
|
|
Excluding Foreign
Currency Changes
(2)
|
|
|
||||||||||
|
Three Months
|
|
|
|
Three Months
|
|
|
||||||||||
|
2018
|
|
|
|
2017
|
|
|
|
|
2018
|
|
|
2017
|
|
|
||
Net investment income, less amortized hedge costs
|
.0
|
|
%
|
|
(6.3
|
)
|
%
|
|
|
2.7
|
|
%
|
|
(5.5
|
)
|
%
|
|
Total adjusted revenues
|
(2.2
|
)
|
|
|
(1.9
|
)
|
|
|
|
(1.8
|
)
|
|
|
(1.8
|
)
|
|
|
Pretax adjusted earnings
(1)
|
.9
|
|
|
|
(5.6
|
)
|
|
|
|
2.7
|
|
|
|
(5.1
|
)
|
|
|
|
Three Months Ended
March 31, |
|
|
|||
Ratios to total revenues:
|
2018
|
|
|
2017
|
|
|
Benefits and claims, net
|
59.4
|
%
|
|
60.8
|
%
|
|
Adjusted expenses:
|
|
|
|
|
|
|
Amortization of deferred policy acquisition costs
|
4.4
|
|
|
4.1
|
|
|
Insurance commissions
|
4.9
|
|
|
4.9
|
|
|
Insurance and other expenses
|
10.2
|
|
|
9.7
|
|
|
Total adjusted expenses
|
19.5
|
|
|
18.7
|
|
|
Pretax adjusted earnings
(1)
|
21.1
|
|
|
20.5
|
|
|
|
In Dollars
|
In Yen
|
|||||||||||||
|
Three Months
|
|
|
Three Months
|
|
||||||||||
(In millions of dollars and billions of yen)
|
2018
|
|
2017
|
|
|
2018
|
|
2017
|
|
||||||
New annualized premium sales
|
$
|
178
|
|
|
$
|
194
|
|
|
|
19.2
|
|
|
22.1
|
|
|
Increase (decrease) over prior period
|
(8.6
|
)%
|
|
(28.3
|
)%
|
|
|
(13.0
|
)%
|
|
(29.2
|
)%
|
|
|
Three Months
|
|
|||||
|
2018
|
|
|
2017
|
|
||
Cancer
|
55.5
|
%
|
|
|
50.2
|
%
|
|
Medical
|
34.0
|
|
|
|
36.8
|
|
|
Income support
|
2.1
|
|
|
|
2.0
|
|
|
Ordinary life:
|
|
|
|
|
|
|
|
WAYS
|
.5
|
|
|
|
.6
|
|
|
Child endowment
|
.5
|
|
|
|
.9
|
|
|
Other ordinary life
(1)
|
6.3
|
|
|
|
8.3
|
|
|
Other
|
1.1
|
|
|
|
1.2
|
|
|
Total
|
100.0
|
%
|
|
|
100.0
|
%
|
|
|
|
Three Months Ended March 31,
|
|
||||||
(In millions)
|
|
2018
|
|
2017
|
|
||||
Yen-denominated:
|
|
|
|
|
|
||||
Fixed maturity securities:
|
|
|
|
|
|
||||
Japan government and agencies
|
|
$
|
3,187
|
|
|
$
|
2,541
|
|
|
Other fixed maturity securities
|
|
412
|
|
|
538
|
|
|
||
Equity securities
|
|
99
|
|
|
149
|
|
|
||
Total yen-denominated
|
|
$
|
3,698
|
|
|
$
|
3,228
|
|
|
|
|
|
|
|
|
||||
U.S. dollar-denominated:
|
|
|
|
|
|
||||
Fixed maturity securities:
|
|
|
|
|
|
||||
Other fixed maturity securities
|
|
$
|
40
|
|
|
$
|
58
|
|
|
Infrastructure debt
|
|
0
|
|
|
30
|
|
|
||
Bank loans
(1)
|
|
180
|
|
|
0
|
|
|
||
Equity securities
|
|
41
|
|
|
7
|
|
|
||
Other investments:
|
|
|
|
|
|
||||
Transitional real estate loans
|
|
1,570
|
|
|
0
|
|
|
||
Commercial mortgage loans
|
|
13
|
|
|
48
|
|
|
||
Middle market loans
|
|
117
|
|
|
97
|
|
|
||
Limited partnerships
|
|
127
|
|
|
0
|
|
|
||
Total dollar-denominated
|
|
$
|
2,088
|
|
|
$
|
240
|
|
|
Total Aflac Japan purchases
|
|
$
|
5,786
|
|
|
$
|
3,468
|
|
|
|
Three Months
|
|
||||||||
|
2018
|
|
|
|
2017
|
|
|
|
||
Total purchases for the period (in millions)
(1)
|
$
|
5,659
|
|
|
|
$
|
3,468
|
|
|
|
New money yield
(1), (2)
|
2.54
|
|
%
|
|
1.21
|
|
%
|
|
||
Return on average invested assets
(3)
|
2.26
|
|
|
|
2.36
|
|
|
|
||
Portfolio book yield, including U.S. dollar-denominated investments, end of period
(1)
|
2.55
|
|
%
|
|
2.57
|
|
%
|
|
|
Three Months Ended
March 31, |
|
||||||
(In millions)
|
2018
|
|
2017
|
|
||||
Net premium income
|
$
|
1,427
|
|
|
$
|
1,390
|
|
|
Net investment income
|
175
|
|
|
178
|
|
|
||
Other income
|
2
|
|
|
1
|
|
|
||
Total adjusted revenues
|
1,604
|
|
|
1,569
|
|
|
||
Benefits and claims
|
697
|
|
|
710
|
|
|
||
Adjusted expenses:
|
|
|
|
|
||||
Amortization of deferred policy acquisition costs
|
146
|
|
|
140
|
|
|
||
Insurance commissions
|
147
|
|
|
145
|
|
|
||
Insurance and other expenses
|
277
|
|
|
264
|
|
|
||
Total adjusted expenses
|
570
|
|
|
549
|
|
|
||
Total benefits and expenses
|
1,267
|
|
|
1,259
|
|
|
||
Pretax adjusted earnings
(1)
|
$
|
337
|
|
|
$
|
310
|
|
|
Percentage change over previous period:
|
|
|
|
|
||||
Net premium income
|
2.7
|
|
%
|
1.7
|
|
%
|
||
Net investment income
|
(1.7
|
)
|
|
2.0
|
|
|
||
Total adjusted revenues
|
2.2
|
|
|
1.7
|
|
|
||
Pretax adjusted earnings
(1)
|
8.7
|
|
|
(6.7
|
)
|
|
|
Three Months Ended
March 31, |
|
|||
Ratios to total revenues:
|
2018
|
|
|
2017
|
|
Benefits and claims
|
43.5
|
%
|
|
45.2
|
%
|
Adjusted expenses:
|
|
|
|
|
|
Amortization of deferred policy acquisition costs
|
9.1
|
|
|
8.9
|
|
Insurance commissions
|
9.2
|
|
|
9.2
|
|
Insurance and other expenses
|
17.3
|
|
|
17.0
|
|
Total adjusted expenses
|
35.6
|
|
|
35.1
|
|
Pretax adjusted earnin
gs
(1)
|
21.0
|
|
|
19.7
|
|
|
Three Months
|
|
||||||||
(In millions)
|
2018
|
|
|
2017
|
|
|
|
|||
New annualized premium sales
|
$
|
335
|
|
|
|
$
|
333
|
|
|
|
Increase (decrease) over prior period
|
.6
|
|
%
|
|
1.7
|
|
%
|
|
|
Three Months Ended
March 31, |
|
||||||
(In millions)
|
2018
|
|
2017
|
|
||||
Fixed maturity securities:
|
|
|
|
|
||||
Other fixed maturity securities
|
$
|
119
|
|
|
$
|
260
|
|
|
Infrastructure debt
|
16
|
|
|
5
|
|
|
||
Equity securities
|
23
|
|
|
2
|
|
|
||
Other investments:
|
|
|
|
|
||||
Transitional real estate loans
|
73
|
|
|
0
|
|
|
||
Middle market loans
|
31
|
|
|
51
|
|
|
||
Limited partnerships
|
23
|
|
|
0
|
|
|
||
Total Aflac U.S. Purchases
|
$
|
285
|
|
|
$
|
318
|
|
|
|
Three Months
|
|
|||||||
|
2018
|
|
|
2017
|
|
||||
Total purchases for period (in millions)
(1)
|
$
|
262
|
|
|
|
$
|
318
|
|
|
New money yield
(1), (2)
|
4.69
|
|
%
|
|
4.33
|
|
%
|
||
Return on average invested assets
(3)
|
5.04
|
|
|
|
4.99
|
|
|
||
Portfolio book yield, end of period
(1)
|
5.52
|
|
%
|
|
5.56
|
|
%
|
|
|
Aflac Japan
|
|
|
Aflac U.S.
|
|
||||||||||||||||
(In millions)
|
March 31,
2018 |
|
December 31,
2017 |
March 31,
2018 |
|
December 31,
2017 |
||||||||||||||||
Available for sale, fixed maturity securities,
at fair value (1) |
|
$
|
74,587
|
|
|
|
|
$
|
69,338
|
|
|
|
$
|
13,081
|
|
|
|
|
$
|
13,606
|
|
|
Held to maturity, fixed maturity securities,
at amortized cost |
|
33,377
|
|
|
|
|
31,430
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||
Equity securities
(1)
|
|
895
|
|
|
|
|
868
|
|
|
|
149
|
|
|
|
|
92
|
|
|
||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Transitional real estate loans
|
|
2,461
|
|
|
|
|
986
|
|
|
|
258
|
|
|
|
|
249
|
|
|
||||
Commercial mortgage loans
|
|
776
|
|
|
|
|
767
|
|
|
|
141
|
|
|
|
|
141
|
|
|
||||
Middle market loans
|
|
622
|
|
|
|
|
527
|
|
|
|
335
|
|
|
|
|
332
|
|
|
||||
Policy loans
|
|
215
|
|
|
|
|
198
|
|
|
|
12
|
|
|
|
|
12
|
|
|
||||
Short-term investments
|
|
0
|
|
|
|
|
57
|
|
|
|
0
|
|
|
|
|
0
|
|
|
||||
Other
|
|
199
|
|
|
|
|
98
|
|
|
|
46
|
|
|
|
|
31
|
|
|
||||
Total other investments
|
|
4,273
|
|
|
|
|
2,633
|
|
|
|
792
|
|
|
|
|
765
|
|
|
||||
Total investments
|
|
113,132
|
|
|
|
|
104,269
|
|
|
|
14,022
|
|
|
|
|
14,463
|
|
|
||||
Cash and cash equivalents
|
|
1,399
|
|
|
|
|
636
|
|
|
|
1,254
|
|
|
|
|
1,011
|
|
|
||||
Total investments and cash
(2)
|
|
$
|
114,531
|
|
|
|
|
$
|
104,905
|
|
|
|
$
|
15,276
|
|
|
|
|
$
|
15,474
|
|
|
|
|
March 31, 2018
|
|
|
|
December 31, 2017
|
|
||||||||||||
|
Amortized
Cost |
|
Fair
Value |
|
Amortized
Cost |
|
Fair
Value |
||||||||||||
AAA
|
|
1.1
|
%
|
|
|
|
1.0
|
%
|
|
|
|
1.0
|
%
|
|
|
|
.9
|
%
|
|
AA
|
|
3.8
|
|
|
|
|
3.8
|
|
|
|
|
3.9
|
|
|
|
|
4.0
|
|
|
A
|
|
67.5
|
|
|
|
|
68.9
|
|
|
|
|
65.8
|
|
|
|
|
66.9
|
|
|
BBB
|
|
22.9
|
|
|
|
|
21.9
|
|
|
|
|
24.0
|
|
|
|
|
23.3
|
|
|
BB or lower
|
|
4.7
|
|
|
|
|
4.4
|
|
|
|
|
5.3
|
|
|
|
|
4.9
|
|
|
Total
|
|
100.0
|
%
|
|
|
|
100.0
|
%
|
|
|
|
100.0
|
%
|
|
|
|
100.0
|
%
|
|
(In millions)
|
Credit
Rating |
|
Amortized
Cost |
|
Fair
Value |
|
Unrealized
Loss |
||||||||||||||
Diamond Offshore Drilling Inc.
|
|
B
|
|
|
|
$
|
144
|
|
|
|
|
$
|
97
|
|
|
|
|
$
|
(47
|
)
|
|
Noble Holdings International Ltd.
|
|
CCC
|
|
|
|
100
|
|
|
|
|
62
|
|
|
|
|
(38
|
)
|
|
|||
AXA
|
|
BBB
|
|
|
|
304
|
|
|
|
|
274
|
|
|
|
|
(30
|
)
|
|
|||
The Sultanate of Oman
|
|
BBB
|
|
|
|
329
|
|
|
|
|
302
|
|
|
|
|
(27
|
)
|
|
|||
Time Warner Cable Inc.
|
|
BBB
|
|
|
|
123
|
|
|
|
|
105
|
|
|
|
|
(18
|
)
|
|
|||
Microsoft Corp.
|
|
AAA
|
|
|
|
234
|
|
|
|
|
217
|
|
|
|
|
(17
|
)
|
|
|||
Baker Hughes Inc.
|
|
A
|
|
|
|
124
|
|
|
|
|
108
|
|
|
|
|
(16
|
)
|
|
|||
Chevron Corp.
|
|
AA
|
|
|
|
181
|
|
|
|
|
166
|
|
|
|
|
(15
|
)
|
|
|||
Weatherford Bermuda
|
|
CCC
|
|
|
|
49
|
|
|
|
|
35
|
|
|
|
|
(14
|
)
|
|
|||
Kraft Heinz Co.
|
|
BBB
|
|
|
|
139
|
|
|
|
|
125
|
|
|
|
|
(14
|
)
|
|
|
March 31, 2018
|
||||||||||||||
(In millions)
|
Par
Value |
|
Amortized
Cost |
|
Fair
Value |
|
Unrealized
Gain (Loss) |
||||||||
Republic of South Africa
|
$
|
471
|
|
|
$
|
471
|
|
|
$
|
500
|
|
|
$
|
29
|
|
Investcorp Capital Limited
|
398
|
|
|
398
|
|
|
413
|
|
|
15
|
|
||||
Navient Corp.
|
312
|
|
|
165
|
|
|
241
|
|
|
76
|
|
||||
KLM Royal Dutch Airlines
|
282
|
|
|
207
|
|
|
246
|
|
|
39
|
|
||||
Republic of Tunisia
|
254
|
|
|
149
|
|
|
182
|
|
|
33
|
|
||||
Barclays Bank PLC
|
188
|
|
|
116
|
|
|
171
|
|
|
55
|
|
||||
Telecom Italia SpA
|
188
|
|
|
188
|
|
|
252
|
|
|
64
|
|
||||
Generalitat de Catalunya
|
151
|
|
|
56
|
|
|
146
|
|
|
90
|
|
||||
Transnet
|
141
|
|
|
141
|
|
|
143
|
|
|
2
|
|
||||
Diamond Offshore Drilling Inc.
|
123
|
|
|
144
|
|
|
97
|
|
|
(47
|
)
|
||||
IKB Deutsche Industriebank AG
|
122
|
|
|
52
|
|
|
111
|
|
|
59
|
|
||||
Alcoa, Inc.
|
100
|
|
|
89
|
|
|
104
|
|
|
15
|
|
||||
Noble Holdings International Ltd.
|
94
|
|
|
100
|
|
|
62
|
|
|
(38
|
)
|
||||
Petrobras International Finance Company
|
84
|
|
|
87
|
|
|
85
|
|
|
(2
|
)
|
||||
EMC Corp.
|
80
|
|
|
82
|
|
|
74
|
|
|
(8
|
)
|
||||
Teva Pharmaceuticals
|
76
|
|
|
76
|
|
|
67
|
|
|
(9
|
)
|
||||
Teck Resources Ltd.
|
70
|
|
|
79
|
|
|
67
|
|
|
(12
|
)
|
||||
Transocean Inc.
|
68
|
|
|
73
|
|
|
60
|
|
|
(13
|
)
|
||||
CF Industries Inc.
|
60
|
|
|
60
|
|
|
58
|
|
|
(2
|
)
|
||||
Nabors Industries Inc.
|
59
|
|
|
57
|
|
|
60
|
|
|
3
|
|
||||
National Gas Co. Trinidad and Tobago
|
52
|
|
|
50
|
|
|
54
|
|
|
4
|
|
||||
Votorantim Overseas Trading IV Ltd.
|
50
|
|
|
49
|
|
|
54
|
|
|
5
|
|
||||
Other Issuers (below $50 million in par value)
|
280
|
|
|
274
|
|
|
258
|
|
|
(16
|
)
|
||||
Subtotal
(1)
|
3,703
|
|
|
3,163
|
|
|
3,505
|
|
|
342
|
|
||||
Senior secured bank loans
|
1,652
|
|
|
1,712
|
|
|
1,654
|
|
|
(58
|
)
|
||||
High yield corporate bonds
|
528
|
|
|
544
|
|
|
527
|
|
|
(17
|
)
|
||||
Middle market loans, net of reserves
(2)
|
970
|
|
|
957
|
|
|
956
|
|
|
(1
|
)
|
||||
Grand Total
|
$
|
6,853
|
|
|
$
|
6,376
|
|
|
$
|
6,642
|
|
|
$
|
266
|
|
(Amortized cost, in millions)
|
March 31,
2018 |
|
December 31,
2017 |
||||||||
Privately issued securities as a percentage of total investment securities
|
|
22.6
|
%
|
|
|
|
23.4
|
%
|
|
||
Privately issued securities held by Aflac Japan
|
|
$
|
23,468
|
|
|
|
|
$
|
22,354
|
|
|
Privately issued securities held by Aflac Japan as a percentage of total
investment securities |
|
20.2
|
%
|
|
|
|
20.8
|
%
|
|
(Amortized cost, in millions)
|
March 31,
2018 |
|
December 31,
2017 |
||||||||
Privately issued reverse-dual currency securities
|
|
$
|
6,030
|
|
|
|
|
$
|
5,669
|
|
|
Publicly issued collateral structured as reverse-dual currency securities
|
|
1,478
|
|
|
|
|
1,390
|
|
|
||
Total reverse-dual currency securities
|
|
$
|
7,508
|
|
|
|
|
$
|
7,059
|
|
|
Reverse-dual currency securities as a percentage of total investment
securities |
|
6.5
|
%
|
|
|
|
6.6
|
%
|
|
|
March 31,
2018
|
|
December 31,
2017
|
|
||||||||||||
(In millions)
|
Amortized
Cost
|
|
Fair
Value
|
|
Amortized
Cost
|
|
Fair
Value
|
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities (excluding bank loans)
(1)
|
$
|
20,329
|
|
|
$
|
20,928
|
|
|
$
|
19,622
|
|
|
$
|
21,863
|
|
|
Fixed maturity securities - bank loans (floating rate)
|
1,930
|
|
|
1,858
|
|
|
1,936
|
|
|
1,865
|
|
|
||||
Equity securities
(1)
|
185
|
|
|
185
|
|
|
147
|
|
|
173
|
|
|
||||
Other investments:
|
|
|
|
|
|
|
|
|
||||||||
Transitional real estate loans (floating rate)
|
2,461
|
|
|
2,470
|
|
|
986
|
|
|
984
|
|
|
||||
Commercial mortgage loans
|
776
|
|
|
751
|
|
|
767
|
|
|
753
|
|
|
||||
Middle market loans (floating rate)
|
622
|
|
|
625
|
|
|
527
|
|
|
530
|
|
|
||||
Alternative investments
|
199
|
|
|
199
|
|
|
97
|
|
|
97
|
|
|
||||
Total U.S. dollar-denominated investments in Aflac Japan
|
$
|
26,502
|
|
|
$
|
27,016
|
|
|
$
|
24,082
|
|
|
$
|
26,265
|
|
|
|
Three Months
|
||
|
2018
|
|
2017
|
FX forward notional at end of period (in billions of dollars)
(2)
|
9.9
|
|
10.7
|
Weighted average original tenor (in months)
(3)
|
30.9
|
|
27.4
|
Weighted average remaining tenor (in months)
(4)
|
23.6
|
|
23.8
|
Annualized amortized hedge costs (in basis points)
(5)
|
225
|
|
184
|
Amortized hedge costs for period (in millions of dollars)
|
(55)
|
|
(52)
|
(In millions)
|
March 31, 2018
|
|
December 31, 2017
|
|
% Change
|
|||||||||||
Aflac Japan
|
|
$
|
6,577
|
|
|
|
|
$
|
6,150
|
|
|
|
|
6.9
|
%
|
(1)
|
Aflac U.S.
|
|
3,356
|
|
|
|
|
3,355
|
|
|
|
|
0.0
|
|
|
||
Total
|
|
$
|
9,933
|
|
|
|
|
$
|
9,505
|
|
|
|
|
4.5
|
%
|
|
(In millions)
|
March 31, 2018
|
|
December 31, 2017
|
|
% Change
|
|||||||||||
Aflac Japan
|
|
$
|
95,351
|
|
|
|
|
$
|
89,132
|
|
|
|
|
7.0
|
%
|
(1)
|
Aflac U.S.
|
|
10,692
|
|
|
|
|
10,625
|
|
|
|
|
.6
|
|
|
||
Other
|
|
160
|
|
|
|
|
138
|
|
|
|
|
15.9
|
|
|
||
Intercompany eliminations
(2)
|
|
(804
|
)
|
|
|
|
(748
|
)
|
|
|
|
7.5
|
|
|
||
Total
|
|
$
|
105,399
|
|
|
|
|
$
|
99,147
|
|
|
|
|
6.3
|
%
|
|
(In millions)
|
2018
|
|
2017
|
|
||||
Dividends declared or paid by Aflac
|
$
|
100
|
|
|
$
|
400
|
|
|
Management fees paid by Aflac
|
96
|
|
|
80
|
|
|
(In millions)
|
2018
|
|
2017
|
|
||||
Operating activities
|
$
|
1,238
|
|
|
$
|
1,757
|
|
|
Investing activities
|
(199
|
)
|
|
(1,527
|
)
|
|
||
Financing activities
|
(473
|
)
|
|
(876
|
)
|
|
||
Exchange effect on cash and cash equivalents
|
23
|
|
|
(8
|
)
|
|
||
Net change in cash and cash equivalents
|
$
|
589
|
|
|
$
|
(654
|
)
|
|
(In millions)
|
2018
|
|
2017
|
|
||||
Aflac Japan
|
$
|
1,062
|
|
|
$
|
1,311
|
|
|
Aflac U.S. and other operations
|
176
|
|
|
446
|
|
|
||
Total
|
$
|
1,238
|
|
|
$
|
1,757
|
|
|
(In millions)
|
2018
|
|
2017
|
|
||||
Aflac Japan
|
$
|
181
|
|
|
$
|
(1,191
|
)
|
|
Aflac U.S. and other operations
|
(380
|
)
|
|
(336
|
)
|
|
||
Total
|
$
|
(199
|
)
|
|
$
|
(1,527
|
)
|
|
(In millions of dollars and thousands of shares)
|
2018
|
|
2017
|
|
||||
Treasury stock purchases
|
$
|
296
|
|
|
$
|
1,220
|
|
|
Number of shares purchased:
|
|
|
|
|
||||
Open market
|
6,640
|
|
|
16,986
|
|
|
||
Other
|
315
|
|
|
288
|
|
|
||
Total shares purchased
|
6,955
|
|
|
17,274
|
|
|
(In millions of dollars and thousands of shares)
|
2018
|
|
2017
|
|
||||
Stock issued from treasury:
|
|
|
|
|
||||
Cash financing
|
$
|
14
|
|
|
$
|
22
|
|
|
Noncash financing
|
15
|
|
|
28
|
|
|
||
Total stock issued from treasury
|
$
|
29
|
|
|
$
|
50
|
|
|
Number of shares issued
|
788
|
|
|
790
|
|
|
(In millions)
|
2018
|
|
2017
|
|
||||
Dividends paid in cash
|
$
|
195
|
|
|
$
|
166
|
|
|
Dividends through issuance of treasury shares
|
8
|
|
|
7
|
|
|
||
Total dividends to shareholders
|
$
|
203
|
|
|
$
|
173
|
|
|
(In millions of dollars and billions of yen)
|
2018
|
|
2017
|
|
||||
Aflac Japan management fees paid to Parent Company
|
$
|
40
|
|
|
$
|
28
|
|
|
Expenses allocated to Aflac Japan (in dollars)
|
8
|
|
|
32
|
|
|
||
Aflac Japan profit remittances to Aflac U.S. (in dollars)
|
312
|
|
|
275
|
|
|
||
Aflac Japan profit remittances to Aflac U.S. (in yen)
|
33.4
|
|
|
31.3
|
|
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period
|
Total
Number of Shares Purchased |
|
Average
Price Paid Per Share |
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans or Programs |
|
Maximum
Number of Shares that May Yet Be Purchased Under the Plans or Programs |
|
|||||
January 1 - January 31
|
2,370,284
|
|
|
$
|
44.31
|
|
|
2,370,284
|
|
|
95,626,488
|
|
|
February 1 - February 28
|
2,349,600
|
|
|
44.70
|
|
|
2,349,600
|
|
|
93,276,888
|
|
|
|
March 1 - March 31
|
1,937,161
|
|
|
44.49
|
|
|
1,920,400
|
|
|
91,356,488
|
|
|
|
Total
|
6,657,045
|
|
(2)
|
$
|
44.50
|
|
|
6,640,284
|
|
|
91,356,488
|
|
(1)
|
Item 6.
|
Exhibits
|
|
-
|
|
Subordinated Indenture, dated as of September 26, 2012, between Aflac Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee - incorporated by reference from Form 8-K dated September 26, 2012, Exhibit 4.1 (File No. 001-07434).
|
|
|
-
|
|
First Supplemental Indenture, dated as of September 26, 2012, between Aflac Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee (including the form of 5.50% Subordinated Debenture due 2052) - incorporated by reference from Form 8-K dated September 26, 2012, Exhibit 4.2 (File No. 001-07434).
|
|
|
-
|
|
Second Supplemental Indenture, dated as of October 23, 2017, between Aflac Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee (including the form of 2.108% Subordinated Debenture due 2047) - incorporated by reference from Form 8-K dated October 23, 2017, Exhibit 4.1 (File No. 001-07434).
|
|
|
-
|
|
Notice of time based restricted stock unit and restricted stock unit agreement under the 2004 Aflac Incorporated Long-Term Incentive Plan, as amended and restated March 14, 2012.
|
|
|
-
|
|
2017 Notice of performance based restricted stock and restricted stock award agreement under the 2004 Aflac Incorporated Long-Term Incentive Plan, as amended and restated March 14, 2012.
|
|
|
-
|
|
Notice of time based restricted stock unit and restricted stock unit agreement under the Aflac Incorporated Long-Term Incentive Plan, as amended and restated February 14, 2017.
|
|
|
-
|
|
2018 Notice of performance based restricted stock and restricted stock award agreement under the Aflac Incorporated Long-Term Incentive Plan, as amended and restated February 14, 2017.
|
|
|
-
|
|
Aflac Incorporated Employment Agreement with Charles D. Lake II, dated January 1, 2018.
|
|
|
-
|
|
Aflac Incorporated Employment Agreement with Audrey Boone Tillman, dated June 11, 2015.
|
|
|
-
|
|
Letter from KPMG LLP regarding unaudited interim financial information.
|
|
|
-
|
|
Certification of CEO dated May 3, 2018, required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934.
|
|
|
-
|
|
Certification of CFO dated May 3, 2018, required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934.
|
|
|
-
|
|
Certification of CEO and CFO dated May 3, 2018, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101.INS
|
-
|
|
XBRL Instance Document.
(1)
|
|
101.SCH
|
-
|
|
XBRL Taxonomy Extension Schema.
|
|
101.CAL
|
-
|
|
XBRL Taxonomy Extension Calculation Linkbase.
|
|
101.DEF
|
-
|
|
XBRL Taxonomy Extension Definition Linkbase.
|
|
101.LAB
|
-
|
|
XBRL Taxonomy Extension Label Linkbase.
|
|
101.PRE
|
-
|
|
XBRL Taxonomy Extension Presentation Linkbase.
|
(1)
|
Includes the following materials contained in this Quarterly Report on Form 10-Q for the period ended March 31, 2018, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Earnings, (ii) Consolidated Statements of Comprehensive Income (Loss), (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Shareholders’ Equity, (v) Consolidated Statements of Cash Flows, (vi) Notes to the Consolidated Financial Statements
|
|||
|
|
|
|
|
*
|
Management contract or compensatory plan or arrangement required to be filed as an exhibit pursuant to Item 6 of this report
|
|
|
Aflac Incorporated
|
|
|
|
May 3, 2018
|
|
/s/
Frederick J. Crawford
|
|
|
(Frederick J. Crawford)
|
|
|
Executive Vice President,
Chief Financial Officer
|
|
|
|
May 3, 2018
|
|
/s/
June Howard
|
|
|
(June Howard)
|
|
|
Senior Vice President, Financial Services; Chief Accounting Officer
|
NOTICE OF GRANT OF TIME BASED
|
AFLAC INCORPORATED
|
RESTRICTED STOCK UNIT AND
|
Worldwide Headquarters
|
RESTRICTED STOCK UNIT AGREEMENT
|
1932 Wynnton Road
|
|
Columbus, Georgia 31999
|
%%FIRST_NAME%-% %%MIDDLE_NAME%-% %%LAST_NAME%-%
|
|
Option Number:
|
%OPTION_NUMBER%-%
|
%%ADDRESS_LINE_1%-%
%%ADDRESS_LINE_2%-%
%%ADDRESS_LINE_3%-%
%%CITY%-%, %%STATE%-% %%ZIPCODE%-%
|
|
Plan:
|
%%EQUITY_PLAN%-%
|
Shares
|
Full Vest
|
%%SHARES_PERIOD1,'999,999,999'%-%
|
%%VEST_DATE_PERIOD1,'MM/DD/YYYY'%-%
|
%%SHARES_PERIOD2,'999,999,999'%-%
|
%%VEST_DATE_PERIOD2,'MM/DD/YYYY'%-%
|
%%SHARES_PERIOD3,'999,999,999'%-%
|
%%VEST_DATE_PERIOD3,'MM/DD/YYYY'%-%
|
/s/ Dan Amos
|
By: Daniel P. Amos
|
Aflac Incorporated
|
A.
|
Award
. The Company hereby grants to the Participant an Award of
|
B.
|
Forfeiture
. Except as otherwise provided in Paragraph C, below, upon termination of the Participant’s employment with the Company and all of its Affiliates, any Stock Units which shall not already have vested pursuant to Paragraph C, below, or as otherwise provided in the Plan, shall be immediately forfeited by the Participant. In the case of a Participant who served as a non-employee sales associate of an Affiliate of the Company immediately before becoming an employee, if such Participant voluntarily terminates employment with the Company or an Affiliate but continues immediately thereafter to perform
bona fide
services for an Affiliate as a sales associate, the Participant shall be treated as continuing employment with the Company or an Affiliate for purposes of this Agreement. If the Committee or its delegate determines, in its sole discretion, that such a Participant is no longer providing
bona fide
services to an Affiliate as a sales associate, the Participant shall be deemed to have terminated employment for purposes of this Agreement on the date as of which such services are determined to have ceased. The Committee may require the Participant to provide such evidence of continuing services as it deems appropriate. The Committee may establish policies and procedures to be followed by the Committee or its delegate in determining whether a Participant is providing
bona fide
services as a sales associate, and such policies (including any amendments or modifications thereto) shall be considered part of this Agreement and shall be binding on the Participant.
|
C.
|
Vesting
. The Stock Units shall vest on one or more calendar dates as set forth in the Notice of Grant; provided that upon the death or disability of the Participant while employed by the Company or an Affiliate, all outstanding Stock Units shall become immediately fully vested. For the purposes of this Paragraph C, “Disability” means a physical or mental condition that qualifies the Grantee for long-term disability benefits under a long-term disability plan maintained by the Company or an Affiliate employing the Grantee.
|
D.
|
Delivery of Shares
. Within 74 days of the calendar vesting date set forth in the Notice of Grant, the Company shall deliver a number of shares equal to the number of vested shares. In the event that any Stock Units vest prior to the applicable calendar vesting date set forth in the Notice of Grant due to the Participant’s disability or voluntary retirement after attaining age 60, the shares subject to such Stock Units shall not be delivered to the Participant until the applicable calendar vesting date. Notwithstanding the foregoing provisions of this Paragraph D, if any Restricted Stock Units become vested upon a Participant’s death, or if the Participant dies after becoming vested in Stock Units due to retirement or disability, shares
|
E.
|
Dividends
. Dividends are paid in the form of shares rather than cash, The number of Stock Units shall be increased by the number of shares that would have been received as a dividend had the Stock Units been outstanding shares. Additional Stock Units credited under the Section shall vest or be forfeited, and shares shall be delivered to Participants, at the same time as the Stock Units to which they relate.
|
F.
|
Miscellaneous
.
|
1.
|
No Rights as a Stockholder
. Prior to delivery of shares pursuant to Paragraph E, the Participant shall have no rights of a stockholder of the Company, including the right to vote such shares or to receive any cash dividends.
|
2.
|
No Additional Rights
. Neither this Agreement nor any of the transactions contemplated hereby shall affect any right of the Participant to continue as an employee of the Company or any Affiliate or otherwise to provide services to the Company or any Affiliate or any of the terms or conditions of any such service.
|
3.
|
Restriction on Transfer
. Except as otherwise provided in the Plan, the Participant may not transfer or assign any of the Participant’s rights with respect to this Award, whether voluntary or involuntary, by operation of law or otherwise. Unless the Committee determines otherwise, if a Participant makes any attempt to transfer or assign the rights with respect to this Award, the Award shall be immediately forfeited by the Participant without consideration at any time.
|
4.
|
Notices
. All notices or other communications hereunder shall be in writing and shall be deemed to have been duly given (a) when delivered personally, (b) by mail, or (c) by electronic communication. The addresses for such notices shall be set out in the Notice of Grant. Either party hereto may change such party’s address for notices by notice duly given pursuant hereto.
|
5.
|
Securities Laws Requirements
. The Company shall not be obligated to transfer any shares to the Participant free of restrictions on transfer if such transfer, in the opinion of counsel for the Company, would violate the Securities Act of 1933, as amended (or any other federal or state statutes having similar requirements as may be in effect at the time transfer otherwise would be made).
|
6.
|
Failure to Enforce Not a Waiver
. The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.
|
7.
|
Incorporation of Plan
. The Plan is hereby incorporated by reference into this Agreement and made a part hereof, and the shares and this Agreement shall be subject to all terms and conditions of the Plan.
|
8.
|
Amendments
. The Committee may amend the terms of this Agreement prospectively or retroactively at any time, but no such amendment shall impair the rights of the Participant hereunder without the Participant’s consent.
|
9.
|
Survival of Terms
. This Agreement shall apply to and bind the Participant and the Company and their respective permitted assignees and transferees, heirs, legatees, executors, administrators and legal successors.
|
10.
|
Authority of the Board
. The Committee shall have full authority to interpret and construe the terms of the Plan and this Agreement. The determination of the Committee as to any such matter of interpretation or construction shall be final, binding and conclusive.
|
11.
|
Representations
. The Participant hereby acknowledges that the Participant has reviewed with the Participant’s own tax advisors the Federal, state, local and foreign tax consequences of the transactions contemplated by this Agreement. The Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Participant understands that the Participant (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by this Agreement.
|
12.
|
Acceptance
. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement and that the Participant has read and understands the terms and provisions thereof, and accepts the shares subject to all the terms and conditions of the Plan and this Agreement. The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under this Agreement.
|
13.
|
Authorization
. The Participant hereby authorizes and directs the Secretary of the Company, or such other person designated by the Company, to take such steps as may be necessary to carry out any of the transactions contemplated by this Agreement.
|
14.
|
Withholding Requirements
. The Company’s obligations under this Agreement shall be subject to all applicable tax and other withholding requirements, and the Company shall, to the extent permitted by law, have the right to deduct any withholding amounts from any payment or transfer of any kind otherwise due to the Participant (including the shares to be delivered upon vesting of Stock Units).
|
15.
|
Certain Defined Terms
. Capitalized terms used but not defined herein shall have the meaning ascribed to them in the Plan.
|
16.
|
Interpretation
. Headings to provisions of this Agreement are intended for convenience of reference only and shall have no effect on the interpretation of this Agreement.
|
17.
|
Severability
. If any provision of this Agreement is held to be invalid or unenforceable, the other provisions of this Agreement shall not be affected but shall be applied as if the invalid or unenforceable provision had not been included in this Agreement.
|
18.
|
Applicable Law
. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Georgia, except to the extent that federal law is controlling.
|
AFLAC INCORPORATED
|
By: Daniel P. Amos
|
Title: Chairman and Chief Executive Officer
|
/s/ Dan Amos
|
By: Daniel P. Amos
|
Aflac Incorporated
|
NOTICE OF GRANT OF TIME BASED
|
AFLAC INCORPORATED
|
RESTRICTED STOCK UNIT AND
|
Worldwide Headquarters
|
RESTRICTED STOCK UNIT AGREEMENT
|
1932 Wynnton Road
|
|
Columbus, Georgia 31999
|
%%FIRST_NAME%-% %%MIDDLE_NAME%-% %%LAST_NAME%-%
|
|
Option Number:
|
%OPTION_NUMBER%-%
|
%%ADDRESS_LINE_1%-%
%%ADDRESS_LINE_2%-%
%%ADDRESS_LINE_3%-%
%%CITY%-%, %%STATE%-% %%ZIPCODE%-%
|
|
Plan:
|
%%EQUITY_PLAN%-%
|
Shares
|
Full Vest
|
%%SHARES_PERIOD1,'999,999,999'%-%
|
%%VEST_DATE_PERIOD1,'MM/DD/YYYY'%-%
|
%%SHARES_PERIOD2,'999,999,999'%-%
|
%%VEST_DATE_PERIOD2,'MM/DD/YYYY'%-%
|
%%SHARES_PERIOD3,'999,999,999'%-%
|
%%VEST_DATE_PERIOD3,'MM/DD/YYYY'%-%
|
/s/ Dan Amos
|
By: Daniel P. Amos
|
Aflac Incorporated
|
A.
|
Award
. The Company hereby grants to the Participant an Award of
|
B.
|
Forfeiture
. Except as otherwise provided in Paragraph C, below, upon termination of the Participant’s employment with the Company and all of its Affiliates, any Stock Units which shall not already have vested pursuant to Paragraph C, below, or as otherwise provided in the Plan, shall be immediately forfeited by the Participant. In the case of a Participant who served as a non-employee sales associate of an Affiliate of the Company immediately before becoming an employee, if such Participant voluntarily terminates employment with the Company or an Affiliate but continues immediately thereafter to perform
bona fide
services for an Affiliate as a sales associate, the Participant shall be treated as continuing employment with the Company or an Affiliate for purposes of this Agreement. If the Committee or its delegate determines, in its sole discretion, that such a Participant is no longer providing
bona fide
services to an Affiliate as a sales associate, the Participant shall be deemed to have terminated employment for purposes of this Agreement on the date as of which such services are determined to have ceased. The Committee may require the Participant to provide such evidence of continuing services as it deems appropriate. The Committee may establish policies and procedures to be followed by the Committee or its delegate in determining whether a Participant is providing
bona fide
services as a sales associate, and such policies (including any amendments or modifications thereto) shall be considered part of this Agreement and shall be binding on the Participant.
|
C.
|
Vesting
. The Stock Units shall vest on one or more calendar dates as set forth in the Notice of Grant; provided that upon the death or disability of the Participant while employed by the Company or an Affiliate, all outstanding Stock Units shall become immediately fully vested. For the purposes of this Paragraph C, “Disability” means a physical or mental condition that qualifies the Grantee for long-term disability benefits under a long-term disability plan maintained by the Company or an Affiliate employing the Grantee.
|
D.
|
Delivery of Shares
. Within 74 days of the calendar vesting date set forth in the Notice of Grant, the Company shall deliver a number of shares equal to the number of vested shares. In the event that any Stock Units vest prior to the applicable calendar vesting date set forth in the Notice of Grant due to the Participant’s disability or voluntary retirement after attaining age 60, the shares subject to such Stock Units shall not be delivered to the Participant until the applicable calendar vesting date. Notwithstanding the foregoing provisions of this Paragraph D, if any Restricted Stock Units become vested upon a Participant’s death, or if the Participant dies after becoming vested in Stock Units due to retirement or disability, shares
|
E.
|
Dividends
. Dividends are paid in the form of shares rather than cash, The number of Stock Units shall be increased by the number of shares that would have been received as a dividend had the Stock Units been outstanding shares. Additional Stock Units credited under the Section shall vest or be forfeited, and shares shall be delivered to Participants, at the same time as the Stock Units to which they relate.
|
F.
|
Miscellaneous
.
|
1.
|
No Rights as a Stockholder
. Prior to delivery of shares pursuant to Paragraph E, the Participant shall have no rights of a stockholder of the Company, including the right to vote such shares or to receive any cash dividends.
|
2.
|
No Additional Rights
. Neither this Agreement nor any of the transactions contemplated hereby shall affect any right of the Participant to continue as an employee of the Company or any Affiliate or otherwise to provide services to the Company or any Affiliate or any of the terms or conditions of any such service.
|
3.
|
Restriction on Transfer
. Except as otherwise provided in the Plan, the Participant may not transfer or assign any of the Participant’s rights with respect to this Award, whether voluntary or involuntary, by operation of law or otherwise. Unless the Committee determines otherwise, if a Participant makes any attempt to transfer or assign the rights with respect to this Award, the Award shall be immediately forfeited by the Participant without consideration at any time.
|
4.
|
Notices
. All notices or other communications hereunder shall be in writing and shall be deemed to have been duly given (a) when delivered personally, (b) by mail, or (c) by electronic communication. The addresses for such notices shall be set out in the Notice of Grant. Either party hereto may change such party’s address for notices by notice duly given pursuant hereto.
|
5.
|
Securities Laws Requirements
. The Company shall not be obligated to transfer any shares to the Participant free of restrictions on transfer if such transfer, in the opinion of counsel for the Company, would violate the Securities Act of 1933, as amended (or any other federal or state statutes having similar requirements as may be in effect at the time transfer otherwise would be made).
|
6.
|
Failure to Enforce Not a Waiver
. The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.
|
7.
|
Incorporation of Plan
. The Plan is hereby incorporated by reference into this Agreement and made a part hereof, and the shares and this Agreement shall be subject to all terms and conditions of the Plan.
|
8.
|
Amendments
. The Committee may amend the terms of this Agreement prospectively or retroactively at any time, but no such amendment shall impair the rights of the Participant hereunder without the Participant’s consent.
|
9.
|
Survival of Terms
. This Agreement shall apply to and bind the Participant and the Company and their respective permitted assignees and transferees, heirs, legatees, executors, administrators and legal successors.
|
10.
|
Authority of the Board
. The Committee shall have full authority to interpret and construe the terms of the Plan and this Agreement. The determination of the Committee as to any such matter of interpretation or construction shall be final, binding and conclusive.
|
11.
|
Representations
. The Participant hereby acknowledges that the Participant has reviewed with the Participant’s own tax advisors the Federal, state, local and foreign tax consequences of the transactions contemplated by this Agreement. The Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Participant understands that the Participant (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by this Agreement.
|
12.
|
Acceptance
. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement and that the Participant has read and understands the terms and provisions thereof, and accepts the shares subject to all the terms and conditions of the Plan and this Agreement. The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under this Agreement.
|
13.
|
Authorization
. The Participant hereby authorizes and directs the Secretary of the Company, or such other person designated by the Company, to take such steps as may be necessary to carry out any of the transactions contemplated by this Agreement.
|
14.
|
Withholding Requirements
. The Company’s obligations under this Agreement shall be subject to all applicable tax and other withholding requirements, and the Company shall, to the extent permitted by law, have the right to deduct any withholding amounts from any payment or transfer of any kind otherwise due to the Participant (including the shares to be delivered upon vesting of Stock Units).
|
15.
|
Certain Defined Terms
. Capitalized terms used but not defined herein shall have the meaning ascribed to them in the Plan.
|
16.
|
Interpretation
. Headings to provisions of this Agreement are intended for convenience of reference only and shall have no effect on the interpretation of this Agreement.
|
17.
|
Severability
. If any provision of this Agreement is held to be invalid or unenforceable, the other provisions of this Agreement shall not be affected but shall be applied as if the invalid or unenforceable provision had not been included in this Agreement.
|
18.
|
Applicable Law
. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Georgia, except to the extent that federal law is controlling.
|
AFLAC INCORPORATED
|
By: Daniel P. Amos
|
Title: Chairman and Chief Executive Officer
|
/s/ Dan Amos
|
By: Daniel P. Amos
|
Aflac Incorporated
|
/s/ DPA
|
|
/s/ CL
|
Initials for Corporation
|
|
Initials of Employee
|
|
|
|
AFLAC INCORPORATED
|
|
|
|
|
|
|
/s/ Charles D. Lake
|
|
|
BY:
|
/s/ Daniel P. Amos
|
CHARLES D. LAKE
|
|
|
|
DANIEL P. AMOS
|
Employee
|
|
|
|
Chairman and Chief Executive Officer
|
|
|
|
|
|
/s/ Andy Conrad
|
|
|
ATTEST:
|
/s/ J. Matthew Loudermilk
|
Witness
|
|
|
|
J. MATTHEW LOUDERMILK
|
|
|
|
|
VP, Corporate Secretary
|
|
|
|
|
|
/s/ DPA
|
|
/s/ ABJ
|
Initials for Corporation
|
|
Initials of Employee
|
|
AFLAC INCORPORATED
|
|
|
|
|
|
|
|
/s/ Audrey Boone Tillman
|
BY:
|
/s/ Daniel P. Amos
|
AUDREY BOONE TILLMAN
|
|
DANIEL P. AMOS
|
Employee
|
|
Chairman and Chief Executive Officer
|
|
|
|
|
|
|
/s/ Susan Storey
|
ATTEST:
|
/s/ J. Matthew Loudermilk
|
Witness
|
|
J. MATTHEW LOUDERMILK
|
|
|
VP, Corporate Secretary
|
/s/ KPMG LLP
|
1.
|
I have reviewed this
quarterly
report on Form
10-Q
of Aflac Incorporated;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
Date:
|
May 3, 2018
|
|
/s/
Daniel P. Amos
|
|
|
|
Daniel P. Amos
|
|
|
|
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this
quarterly
report on Form
10-Q
of Aflac Incorporated;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
Date:
|
May 3, 2018
|
|
/s/ Frederick J. Crawford
|
|
|
|
Frederick J. Crawford
|
|
|
|
Executive Vice President, Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/
Daniel P. Amos
|
||
Name:
|
|
Daniel P. Amos
|
Title:
|
|
Chief Executive Officer
|
Date:
|
|
May 3, 2018
|
/s/
Frederick J. Crawford
|
||
Name:
|
|
Frederick J. Crawford
|
Title:
|
|
Chief Financial Officer
|
Date:
|
|
May 3, 2018
|